demand for substantial performance is delivered to the Executive by the Board whichspecifically identifies the manner in which the Executive has not substantially performed theExecutive’s duties, or          (ii) the willful engaging by the Executive in illegal conduct or gross misconduct which ismaterially and demonstrably injurious to the Parent or the Company.     No act, or failure to act, on the part of the Executive shall be considered “willful” unlessit is done, or omitted to be done, by the Executive in bad faith or without reasonable belief thatthe Executive’s action or omission was in the best interests of the Parent or the Company. Anyact, or failure to act, based upon authority given pursuant to a resolution duly adopted by theBoard or upon the instructions of the Chief Executive Officer or of a more senior officer of theCompany or based upon the advice of counsel for the Parent (which may be the General Counsel orother counsel employed by the Parent or its subsidiaries) shall be conclusively presumed to bedone, or omitted to be done, by the Executive in good faith and in the best interests of the Parentor the Company. The cessation of employment of the Executive shall not be deemed to be for Causeunless and until there shall have been delivered to the Executive a copy of a resolution dulyadopted by the affirmative vote of not less than three-quarters of the entire membership of theBoard at a meeting of the Board called and held for such purpose (after reasonable notice isprovided to the Executive, and the Executive is given an opportunity, together with counsel, to beheard before the Board), finding that, in the good faith opinion of the Board, the Executive isguilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particularsthereof in detail.     (h) “Change of Control” shall be deemed to have occurred if any event set forth in any one ofthe following paragraphs shall have occurred:          (i) any Person is or becomes the Beneficial Owner, directly or indirectly, of twenty percent(20%) or more of either (A) the then outstanding common shares of the Parent (the “OutstandingParent Common Shares”) or (B) the combined voting power of the then outstanding voting securitiesof the Parent entitled to vote generally in the election of directors (the “Outstanding ParentVoting Securities”), excluding any Person who becomes such a Beneficial Owner in connection with atransaction that complies with clauses (A), (B) and (C) of paragraph (iii) below;          (ii) individuals, who, as of the date hereof, constitute the Board (the “Incumbent Board”)cease for any reason to constitute at least two-thirds (2/3) of the Board; provided, however, thatany individual becoming a director subsequent to the date hereof whose election, or nomination forelection by the Parent’s shareholders, was approved by a vote of at least two-thirds (2/3) of theIncumbent Board shall be considered as though such individual was a member of the Incumbent Board,but excluding, for this purpose, any such individual whose initial assumption of office occurs as aresult of an actual or threatened election contest with respect to the election or removal ofdirectors or any other actual or threatened solicitation of proxies or consents by or on behalf ofa Person other than the Board; or          (iii) the consummation of a reorganization, merger, amalgamation, consolidation, scheme ofarrangement, exchange offer or similar transaction of the Parent or any of its subsidiaries or thesale, transfer or other disposition of all or substantially all of the Parent’s Assets (any ofwhich a “Corporate Transaction”), unless, following such Corporate Transaction or series of relatedCorporate Transactions, as the case may be, (A) all of the individuals and entities (which, forpurposes of this Agreement, shall include, without limitation, any corporation, partnership,association, joint-stock company, limited liability company, trust, unincorporated organization orother business entity) who were the beneficial owners, respectively, of the Outstanding ParentCommon Shares and Outstanding Parent Voting Securities immediately prior to such CorporateTransaction beneficially own, directly or indirectly, more than sixty-six and two-thirds percent(66-2/3%) of, respectively, the then outstanding
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common shares and the combined voting power of the then outstanding voting securities entitledto vote generally in the election of directors (or other governing body), as the case may be, ofthe entity resulting from such Corporate Transaction (including, without limitation, an entitywhich as a result of such transaction owns the Parent or all or substantially all of the Parent’sAssets either directly or through one (1) or more subsidiaries or entities) in substantially thesame proportions as their ownership, immediately prior to such Corporate Transaction, of theOutstanding Parent Common Shares and the Outstanding Parent Voting Securities, as the case may be,(B) no Person (excluding any entity resulting from such Corporate Transaction or any employeebenefit plan (or related trust) of the Parent or such entity resulting from such CorporateTransaction) beneficially owns, directly or indirectly, twenty percent (20%) or more of,respectively, the then outstanding shares of common stock of the entity resulting from suchCorporate Transaction or the combined voting power of the then outstanding voting securities ofsuch entity except to the extent that such ownership existed prior to the Corporate Transaction and(C) at least two-thirds (2/3) of the members of the board of directors (or other governing body) ofthe entity resulting from such Corporate Transaction were members of the Incumbent Board at thetime of the approval of such Corporate Transaction; or          (iv) Approval or adoption by the Board of Directors or the shareholders of the Parent of aplan or proposal which could result directly or indirectly in the liquidation, transfer, sale orother disposal of all or substantially all of the Parent’s Assets or the dissolution of the Parent.     (i) “Disability” shall mean the absence of the Executive from performance of the Executive’sduties with the Parent on a substantial basis for one hundred twenty (120) calendar days as aresult of incapacity due to mental or physical illness.     (j) “Employment Agreement” shall mean the Executive’s employment agreement with the Parent, asit may be amended from time to time.     (k) “Employment Period” shall have the meaning specified in the Employment Agreement.     (l) “Entity” shall mean means any corporation, partnership, association, joint-stock company,limited liability company, trust, unincorporated organization or other business entity.     (m) “ERP” shall mean the Weatherford International Ltd. Nonqualified Executive RetirementPlan, as it may be amended from time to time.     (n) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time totime.     (o) “Good Reason” shall mean the occurrence of any of the following:          (i) the assignment to the Executive of any position, authority, duties or responsibilitiesthat are not materially consistent with the Executive’s position (including status, offices andtitles), authority, duties or responsibilities as contemplated by Section 3(a) of the EmploymentAgreement, or any other action by the Parent or the Company which results in a diminution in suchposition, authority, duties or responsibilities, excluding for this purpose any not taken in badfaith and which is remedied by the Parent or the Company after receipt of notice thereof given bythe Executive;          (ii) any failure by the Parent or the Company to comply with any of the provisions of thisAgreement or the Employment Agreement (including, without limitation, its obligations under Section3(a) of the Employment Agreement), other than any failure not occurring in bad faith and which isremedied by the Parent or the Company after receipt of notice thereof given by the Executive;
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          (iii) any failure by the Parent or the Company to continue to provide the Executive withbenefits currently enjoyed by the Executive under any of the Parent’s and the Company’scompensation, bonus, retirement, pension, savings, life insurance, medical, health and accident, ordisability plans, or the taking of any other action by the Parent or the Company which woulddirectly or indirectly reduce any of such benefits or deprive the Executive of any fringe benefitsor perquisites currently enjoyed by the Executive;          (iv) the Parent’s or the Company’s requiring the Executive to be based at any office orlocation other than as provided in Section 3(a)(i) of the Employment Agreement or the Parent’s orthe Company’s requiring the Executive to travel on business to a substantially greater extent thanrequired immediately prior to the date hereof;          (v) any purported termination by the Parent or the Company of the Executive’s employment(including, without limitation, any secondment of the Executive without the Executive’s priorexpress agreement in writing);          (vi) any failure by the Parent to comply with and satisfy Section 10(b) of the EmploymentAgreement; or          (vii) in connection with, as a result of or following a Change of Control, the giving ofnotice to the Executive that the Employment Period shall not be extended.     In the event of a Change of Control or other Corporate Transaction in which the Parent’scommon shares may cease to be publicly traded, following the Change of Control or the consummationof such other Corporate Transaction, “Good Reason” shall be deemed to exist upon the occurrence ofany of the events listed in clauses (i) through (vii) above and also in the event Executive isassigned to any position (including status, offices, titles and reporting requirements), authority,duties or responsibilities that are (A) not at or with the publicly-traded ultimate parent companyof the successor to the Parent or the corporation or other entity surviving or resulting from suchCorporate Transaction or (B) inconsistent with the Executive’s position (including status, offices,titles and reporting requirements), authority, duties or responsibilities as contemplated bySection 3(a) of the Employment Agreement.     For purposes of this Agreement, any good faith determination of “Good Reason” made by theExecutive shall be conclusive.     (p) “IRS” shall mean the Internal Revenue Service.     (q) “Parent” shall mean Weatherford International Ltd. or any successor to WeatherfordInternational Ltd., including but not limited to any Entity into which Weatherford InternationalLtd. is merged, consolidated or amalgamated, or any Entity otherwise resulting from a CorporateTransaction.     (r) “Parent’s Assets” shall mean the assets (of any kind) owned by the Parent, including,without limitation, the securities of the Parent’s Subsidiaries and any of the assets owned by theParent’s Subsidiaries.     (s) “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modifiedand used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) theParent or any of its subsidiaries, (ii) a trustee or other fiduciary holding securities under anemployee benefit plan of the Parent or any of its Affiliates, (iii) an underwriter temporarilyholding securities pursuant to an offering by the Parent of such securities, or (iv) a corporationor other entity owned,
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directly or indirectly, by the shareholders of the Parent in the same proportions as theirownership of common shares of the Parent.     (t) “Section 409A” shall mean section 409A of the Internal Revenue Code of 1986, as amendedand the final Department of Treasury regulations issued thereunder.     (u) “Separation From Service” shall have the meaning ascribed to such term in Section 409A.     (v) “Specified Employee” shall have the meaning ascribed to such term in Section 409A.     (w) “SRP” shall mean the Weatherford International, Inc. Supplemental Retirement Plan, as itmay be amended from time to time.     (x) “Subsidiary” shall mean any majority-owned subsidiary of the Parent or any majority-ownedsubsidiary thereof, or any other Entity in which the Parent owns, directly or indirectly, asignificant financial interest provided that the Chief Executive Officer of the Parent designatessuch Entity to be a Subsidiary for the purposes of this Agreement.     (y) “Term of the Agreement” shall mean the period commencing on February 9, 2009 and ending onDecember 31, 2009.2. Termination of Employment.     (a) Death or Disability. The Executive’s employment shall terminate automatically upon theExecutive’s death during the Employment Period. If the Parent determines in good faith that theDisability of the Executive has occurred during the Employment Period, it may provide the Executivewith written notice in accordance with the Employment Agreement of its intention to terminate theExecutive’s employment. In such event, the Executive’s employment with the Parent shall terminateeffective thirty (30) days after receipt of such notice by the Executive (the “Disability EffectiveDate”), provided that within the thirty (30)-day period after such receipt, the Executive shall nothave returned to full-time performance of the Executive’s duties. In addition, if a physicianselected by the Executive determines that the Disability of the Executive has occurred, theExecutive (or his representative) may provide the Company with written notice in accordance withthe Employment Agreement of the Executive’s intention to terminate his employment. In such event,the Disability Effective Date shall be thirty (30) days after receipt of such notice by theCompany.     (b) Cause. The Parent may terminate the Executive’s employment during the Employment Periodfor Cause.     (c) Good Reason. The Executive’s employment may be terminated by the Executive at any timeduring the Employment Period for Good Reason.     (d) Notice of Termination. Any termination during the Employment Period shall be communicatedby Notice of Termination to the other party hereto given in accordance with Section 11(b) of thisAgreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which(i) indicates the specific termination provision in this Agreement or the Employment Agreementrelied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts andcircumstances claimed to provide a basis for termination of the Executive’s employment under theprovision so indicated and (iii) if the Date of Termination (as defined below) is other than thedate of receipt of such notice, specifies the termination date (which date, in the case of a noticeby the Company, shall be not more than
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30 days after the giving of such notice). The failure by the Executive or the Company to setforth in the Notice of Termination any fact or circumstance which contributes to a showing of GoodReason or Cause shall not waive any right of the Executive or the Company, respectively, fromasserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.     (e) Date of Termination. “Date of Termination” shall mean:          (i) if the Executive’s employment is terminated by the Company for Cause, or by the Executivefor Good Reason, the date of receipt of the Notice of Termination or any later date specifiedtherein, as the case may be;          (ii) if the Executive’s employment is terminated by the Company or the Parent other than forCause, the Date of Termination shall be the date on which the Executive receives notice of suchtermination; and          (iii) if the Executive’s employment is terminated by reason of death or Disability, the Dateof Termination shall be the date of death of the Executive or the Disability Effective Date, as thecase may be.3. Obligations of the Company Upon Termination.     (a) Death, Disability, Good Reason or Other than For Cause. If, during the Employment Periodand prior to the expiration of the Term of the Agreement, the Executive’s employment is terminatedby reason of the Executive’s death or Disability, by the Parent or the Company for any reason otherthan for Cause or by the Executive for Good Reason:          (i) The Company shall pay to the Executive (or Executive’s heirs, beneficiaries orrepresentatives as applicable), at the times specified in clause (x), the following amounts:               (A) an amount equal to the Executive’s Annual Base Salary through the Date of Termination forperiods following his Separation From Service to the extent not theretofore paid;               (B) an amount equal to the product of (x) the higher of (I) the highest Annual Bonus Amountfor the preceding five (5) calendar years and (II) the Annual Bonus Amount that would be payable inrespect of the current fiscal year (and annualized for any fiscal year consisting of less thantwelve (12) months) (such higher amount being referred to as the “Highest Annual Bonus”) and (y) afraction, the numerator of which is the number of days in the current fiscal year through the Dateof Termination, and the denominator of which is three hundred sixty-five (365);               (C) an amount equal to two times the sum of (i) the highest Annual Base Salary received by theExecutive in the last five (5) years ended prior to the Termination Date and (ii) the HighestAnnual Bonus;               (D) an amount equal to two times the sum of (i) the total of the employer basic and matchingcontributions credited to the Executive under the Company’s 401(k) Savings Plan (the “401(k) Plan”)during the twelve (12)-month period immediately preceding the month of the Executive’s Date ofTermination, and (ii) the amount that would have been credited and contributed to the Executive andhis accounts under all other deferred compensation plans (excluding the ERP and the SRP) using theamounts specified in clauses (i) and (ii) of Section 3(a)(i)(C), such total amount to be grossed upso that the amount the Executive actually receives after payment of any federal or state taxespayable thereon equals the amount first described above; and
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               (E) the total value of all fringe benefits received by the Executive on an annualized basismultiplied by two (2).          (ii) For a period of two (2) years from the Executive’s Date of Termination, or such longerperiod as may be provided by the terms of the appropriate plan, program, practice or policy, theCompany shall continue benefits to the Executive and the Executive’s family equal to those whichwould have been provided to them in accordance with the plans, programs, practices and policiesdescribed in Section 3(b)(iv) of the Employment Agreement if the Executive’s employment had notbeen terminated; provided, however, that with respect to any of such plans, programs, practices orpolicies requiring an employee contribution, the Executive (or Executive’s heirs or beneficiariesas applicable) shall continue to pay the monthly employee contribution for same, and providedfurther, that if the Executive becomes re-employed by another employer and is eligible to receivemedical or other welfare benefits under another employer provided plan, the medical and otherwelfare benefits described herein shall be secondary to those provided under such other plan duringsuch applicable period of eligibility. If any of the dental, accident, health insurance or otherbenefits specified in this Section 3(a)(ii) are taxable to the Executive and are not exempt fromSection 409A, the following provisions shall apply to the reimbursement or provision of suchbenefits. The Executive shall be eligible for reimbursement for covered welfare expenses, or forthe provision of such benefits on an in-kind basis, during the period commencing on Executive’sDate of Termination and ending on the third anniversary of such date. The amount of such welfarebenefit expenses eligible for reimbursement or the in-kind benefits provided under this Section3(a)(ii), during the Executive’s taxable year will not affect the expenses eligible forreimbursement, or the benefits to be provided, in any other taxable year (with the exception ofapplicable lifetime maximums applicable to medical expenses or medical benefits described inSection 105(b) of the Code). The Executive’s right to reimbursement or direct provision ofbenefits under this Section 3(a)(ii) is not subject to liquidation or exchange for another benefit.To the extent that the benefits provided to the Executive pursuant to this Section 3(a)(ii) aretaxable to the Executive and are not otherwise exempt from Section 409A, any reimbursement amountsto which the Executive would otherwise be entitled under this Section 3(a)(ii) during the first sixmonths following the date of the Executive’s Separation From Service shall be accumulated and paidto the Executive on the date that is six months following the date of his Separation From Service.All reimbursements by the Company under this Section 3(a)(ii) shall be paid no later than theearlier of (i) the time periods described above and (ii) the last day of the Executive’s taxableyear following the taxable year in which the expense was incurred.          (iii) All benefits and amounts under the Company’s deferred compensation plan and all otherbenefit plans (except as specifically provided for in Section 4(b) below), not already vested shallbecome immediately one hundred percent (100%) vested as of the Date of Termination. All options toacquire common shares of the Parent, all restricted common shares of the Parent, and all shareappreciation rights the value of which is determined by reference to or based upon the value ofcommon shares of the Parent, held by the Executive under any plan of the Company or its affiliatedcompanies shall become immediately vested, exercisable and nonforfeitable. The effect, if any, ofa Change of Control on any other equity incentives and other awards the value of which isdetermined by reference to or based upon the value of common shares of the Parent shall bedetermined in accordance with the terms of the applicable award agreement.          (iv) The Company shall, at its sole expense as incurred, provide the Executive with reasonableoutplacement services from a provider selected by the Executive in his sole discretion. TheCompany shall directly pay the provider the fees for such outplacement services. The period duringwhich such outplacement services shall be provided to the Executive at the expense of the Companyshall not extend beyond the last day of the second taxable year of the Executive following thetaxable year of the Executive during which he incurs a Separation From Service.
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          (v) At the time specified in clause (x) below, ownership of all country club memberships,luncheon clubs and other memberships which the Company was providing for the Executive’s or hisfamily’s use prior to the time that the Notice of Termination is given shall be transferred andassigned to the Executive at no cost to the Executive (other than ordinary income taxes owed), thecost of transfer, if any, to be borne by the Company.          (vi) At the time specified in clause (x) below, the Company shall pay the Executive a lump sumin cash equal to the Executive’s annual car allowance multiplied by two (2).          (vii) To the extent not already paid or provided, the Company shall timely pay or provide tothe Executive any other amounts or benefits required to be paid or provided or which the Executiveis eligible to receive under any plan, program, policy or practice or contract or agreement of theCompany and its affiliated companies (collectively, the “Other Benefits”).          (viii) If the Executive’s employment is terminated by reason of the Executive’s death, theOther Benefits (as defined in this Section) shall also include, without limitation, and theExecutive’s estate and/or beneficiaries shall be entitled to receive, benefits at least equal tothe most favorable benefits provided by the Company and its affiliated companies to the estates andbeneficiaries of the executive officers of the Company and such affiliated companies under suchplans, programs, practices and policies relating to death benefits, if any, in effect on the datehereof or, if more favorable, those in effect on the date of the Executive’s death.          (ix) If the Executive’s employment is terminated by reason of the Executive’s Disability, theOther Benefits (as defined in this Section) shall also include, without limitation, and theExecutive shall be entitled after the Disability Effective Date to receive, disability and otherbenefits at least equal to the most favorable benefits generally provided by the Company and itsaffiliated companies to the Executive’s disabled peer executive officers and/or their families inaccordance with such plans, programs, practices and policies relating to disability, if any, ineffect generally on the date hereof or, if more favorable, those in effect at the time of theDisability.          (x) The Company shall pay or provide to the Executive the amounts or benefits specified inSections 3(a)(i)(A), 3(a)(i)(B), 3(a)(i)(C), 3(a)(i)(D) and 3(a)(i)(E), and Sections 3(a)(v) and3(a)(vi) 30 days following the date of the Executive’s Separation From Service if he is not aSpecified Employee on the date of his Separation From Service or on the date that is six monthsfollowing the date of his Separation From Service if he is a Specified Employee.          (xi) If the Executive is a Specified Employee, on the date that is six months following theExecutive’s Separation From Service, the Company shall pay to the Executive, in addition to theamounts reflected in clause (x), an amount equal to the interest that would be earned on theamounts specified in Sections 3(a)(i)(A), 3(a)(i)(B), 3(a)(i)(C), 3(a)(i)(D) and 3(a)(i)(E) and, tothe extent subject to a mandatory six-month delay in payment, all amounts payable under the ERP andthe SRP, for the period commencing on the date of the Executive’s Separation From Service until thedate of payment of such amounts, calculated using an interest rate of five percent per annum (the“Interest Amount”).          (xii) Notwithstanding any other provision of this Agreement to the contrary, the amount of thepayment under each of Sections 3(a)(i)(B), 3(a)(i)(C), 3(a)(i)(D) and 3(a)(i)(E) shall not exceedthe amount that would have been paid to the Executive had his Date of Termination occurred onDecember 31, 2008.     (b) Cause. If the Executive’s employment is terminated for Cause during the Employment Periodand prior to the expiration of the Term of the Agreement, this Agreement shall terminate without
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further obligations to the Executive, other than the obligation to pay to the Executive (x)his Annual Base Salary through the Date of Termination for periods following his Separation FromService on the date that is 30 days following the date of the Employee’s Separation From Service ifhe is not a Specified Employee or on the date that is six months following the date of hisSeparation From Service if he is a Specified Employee, and (y) Other Benefits, to the extenttheretofore unpaid.     (c) Termination by Executive Other Than for Good Reason. If the Executive voluntarilyterminates his employment during the Employment Period and prior to the expiration of the Term ofthe Agreement for any reason other than for Good Reason, the Executive’s employment shall terminatewithout further obligations to the Executive, other than (x) the obligation to pay to the Executivehis Annual Base Salary through the Date of Termination for periods following his Separation FromService, (y) Other Benefits and (z) the rights provided in Section 4. The Company shall pay to theExecutive the amount specified in clause (x) on the date that is 30 days following the date of theEmployee’s Separation From Service if he is not a Specified Employee or on the date that is sixmonths following the date of his Separation From Service if he is a Specified Employee.4. Other Rights.     (a) Except as provided herein, nothing in this Agreement shall prevent or limit theExecutive’s continuing or future participation in any plan, program, policy or practice provided bythe Company or any of its affiliated companies and for which the Executive may qualify, nor shallanything herein limit or otherwise affect such rights as the Executive may have under any plan,contract or agreement with the Company or any of its affiliated companies. Except as otherwiseexpressly provided herein, amounts which are vested benefits, which vest according to the terms ofthis Agreement or which the Executive is otherwise entitled to receive under any plan, policy,practice or program of or any contract or agreement with the Company or any of its affiliatedcompanies prior to, at or subsequent to the Date of Termination shall be payable in accordance withsuch plan, policy, practice, program, contract or agreement. If any severance payments arerequired to be paid to the Executive in conjunction with severance of employment under federal,state or local law, the severance payments paid to the Executive under this Agreement will bedeemed to be in satisfaction of any such statutorily required benefit obligations to the extentthat doing so would not result in an acceleration of payment of nonqualified deferred compensationthat is prohibited under Section 409A.     (b) Solely with respect to the ERP and the SRP, if the Executive’s employment is terminatedfor any reason whatsoever, with or without Cause, and no Change of Control has occurred or ispending, any ERP or SRP benefits payable shall only be those that are payable, if any, under theterms of the ERP or SRP as of the Date of Termination.5. Full Settlement.     (a) No Rights of Offset. The Company’s obligation to make the payments provided for in thisAgreement and otherwise to perform its obligations hereunder shall not be affected by any set-off,counterclaim, recoupment, defense or other claim, right or action which the Company may haveagainst the Executive or others.     (b) No Mitigation Required. The Company agrees that, if the Executive’s employment with theCompany terminates, the Executive is not required to seek other employment or to attempt in any wayto reduce any amounts payable to the Executive by the Company pursuant to this Agreement. Further,except as specified in Section 3(a)(ii), the amount of any payment or benefit provided for in thisAgreement shall not be reduced by any compensation earned by the Executive as the result of
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employment by another employer, by retirement benefits, by offset against any amount claimedto be owed by the Executive to the Company, or otherwise.     (c) Legal Fees. The Company agrees to pay promptly as incurred, to the full extent permittedby law, all legal fees and expenses which the Executive may reasonably incur as a result of anycontest (regardless of the outcome thereof) by the Company or the Executive of the validity orenforceability of, or liability under, any provision of this Agreement or the Employment Agreementor any guarantee of performance thereto (including as a result of any contest by the Executiveabout the amount of any payment pursuant to this Agreement or the Employment Agreement). The legalfees or expenses that are subject to reimbursement pursuant to this Section 5(c) shall not belimited as a result of when the fees or expenses are incurred. The amount of legal fees orexpenses that is eligible for reimbursement pursuant to this Section 5(c) during a given taxableyear of the Executive shall not affect the amount of expenses eligible for reimbursement in anyother taxable year of the Executive. The right to reimbursement pursuant to this Section 5(c) isnot subject to liquidation or exchange for another benefit. Any amount to which the Executive isentitled to reimbursement under this Section 5(c) during the first six months following the date ofthe Executive’s Separation From Service shall be accumulated and paid to the Executive on the datethat is six months following the date of his Separation From Service. All reimbursements by theCompany under this Section 5(c) shall be paid no later than the earlier of (i) the time periodsdescribed above and (ii) the last day of the Executive’s taxable year next following the taxableyear in which the expense was incurred.6. Certain Additional Payments by the Company.     (a) Anything in this Agreement to the contrary notwithstanding, if it shall be determined thatany payment or distribution by the Parent, the Company or any of their affiliated companies to orfor the benefit of the Executive (whether paid or payable or distributed or distributable pursuantto the terms of this Agreement, any other plan, agreement or contract or otherwise, but determinedwithout regard to any additional payments required under this Section 6) (a “Payment”) would besubject to any additional tax or excise tax imposed by sections 409A, 457A or 4999 of the Code (andany successor provisions or sections to sections 409A, 457A and 4999) or any interest or penaltiesare incurred by the Executive with respect to such excise tax (such excise tax, together with anysuch interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), thenthe Executive shall be entitled to promptly receive from the Company an additional payment (a“Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes (includingany interest or penalties imposed with respect to such taxes), including without limitation, anyincome taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposedupon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to theExcise Tax imposed upon the Payments. Any Gross Up Payment shall be made by the Company at least10 days prior to the date that the Executive is required to remit to the relevant taxing authorityany federal, state and local taxes imposed upon the Executive, including the amount of additionaltaxes imposed upon the Executive due to the Company’s payment of the initial taxes on such amounts.Notwithstanding any provision of this Agreement to the contrary, any amounts to which theExecutive would otherwise be entitled under this Section 6(a) during the first six months followingthe date of the Executive’s Separation From Service shall be accumulated and paid to the Executiveon the date that is six months following the date of his Separation From Service. Allreimbursements by the Company under this Section 6(a) be paid no later than the earlier of (i) thetime periods described above and (ii) the last day of the Executive’s taxable year next followingthe taxable year in which the expense was incurred.     (b) Subject to the provisions of Section 6(c), all determinations required to be made underthis Section 6, including whether and when a Gross-Up Payment is required and the amount of suchGross-Up Payment and the assumptions to be utilized in arriving at such determination shall be madeby
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PricewaterhouseCoopers or, as provided below, such other certified public accounting firm asmay be designated by the Executive (the “Accounting Firm”) which shall provide detailed supportingcalculations both to the Company and the Executive within fifteen (15) business days after thereceipt of notice from the Executive that there has been a Payment, or such earlier time as isrequested by the Company. In the event that the Accounting Firm is serving as accountant orauditor for the individual, entity or group effecting the Change of Control, the Executive shallappoint another nationally recognized accounting firm to make the determinations required hereunder(which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees andexpenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, asdetermined pursuant to this Section 6, shall be paid by the Company to the Executive within five(5) days after the receipt of the Accounting Firm’s determination. Any determination by theAccounting Firm, absent manifest error, shall be binding upon the Company and the Executive,subject to the last sentence of Section 6(a), and in no event later than the payment deadlinespecified in Section 6(a). As a result of the uncertainty in the application of section 4999 ofthe Code at the time of the initial determination by the Accounting Firm hereunder, it is possiblethat Gross-Up Payments which will not have been made by the Company should have been made(“Underpayment”), consistent with the calculations required to be made hereunder. In the eventthat the Company exhausts its remedies pursuant to Section 6(c) and the Executive thereafter isrequired to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of theUnderpayment that has occurred and any such Underpayment shall be promptly paid by the Company toor for the benefit of the Executive, subject to the last sentence of Section 6(a), and in no eventlater than the payment deadline specified in Section 6(a).     (c) The Executive shall notify the Company in writing of any claim by the IRS that, ifsuccessful, would require the payment by the Company of the Gross-Up Payment (or an additionalGross-Up Payment) in the event the IRS seeks higher payment. Such notification shall be given assoon as practicable, but no later than ten business days after the Executive is informed in writingof such claim, and shall apprise the Company of the nature of such claim and the date on which suchclaim is requested to be paid. The Executive shall not pay such claim prior to the expiration ofthe thirty (30)-day period following the date on which he gives such notice to the Company (or suchshorter period ending on the date that any payment of taxes with respect to such claim is due). Ifthe Company notifies the Executive in writing prior to the expiration of such period that itdesires to contest such claim, the Executive shall:          (i) give the Company any information reasonably requested by the Company relating to suchclaim,          (ii) take such action in connection with contesting such claim as the Company shall reasonablyrequest in writing from time to time, including without limitation, accepting legal representationwith respect to such claim by an attorney reasonably selected by the Company,          (iii) cooperate with the Company in good faith in order to effectively contest such claim, and          (iv) permit the Company to participate in any proceedings relating to such claims; provided,however, that the Company shall bear and pay directly all costs and expenses (including additionalinterest and penalties) incurred at any time during the period that ends ten years following thelifetime of the Executive in connection with such proceedings and shall indemnify and hold theExecutive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest andpenalties with respect thereto) imposed as a result of such representation and payment of costs andexpenses. Without limitation on the foregoing provisions of this Section 6(c), the Company shallcontrol all proceedings taken in connection with such contest and, at its sole option, may pursueor forego any and all administrative appeals, proceedings, hearings and conferences with the taxingauthority in respect of such
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claim and may, at its sole option, either direct the Executive to pay the tax claimed and suefor a refund or contest the claim in any permissible manner, and the Executive agrees to prosecutesuch contest to determination before any administrative tribunal, in a court of initialjurisdiction and in one or more appellate courts, as the Company shall determine; provided,however, that if the Company directs the Executive to pay such claim and sue for a refund, theCompany shall advance the amount of such payment to the Executive, on an interest-free basis andshall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax orincome tax (including interest or penalties with respect thereto) imposed with respect to suchadvance or with respect to any imputed income with respect to such advance; and further providedthat any extension of the statute of limitations relating to payment of taxes for the taxable yearof the Executive with respect to which such contested amount is claimed to be due is limited solelyto such contested amount. The Company shall not direct the Executive to pay such a claim and suefor a refund if, due to the prohibitions of section 402 of the Sarbanes-Oxley Act of 2002, theCompany may not advance to the Executive the amount necessary to pay such claim. All such costsand expenses shall be made by the Company at least 10 days prior to the date that the Executive isrequired to pay or incur such costs and expenses. The costs and expenses that are subject to bepaid by the Company pursuant to this Section 6(c) shall not be limited as a result of when thecosts or expenses are incurred. The amounts of costs or expenses that are eligible for paymentpursuant to this Section 6(c)(iv) during a given taxable year of the Executive shall not affect theamount of costs or expenses eligible for payment in any other taxable year of the Executive. Theright to payment of costs and expenses pursuant to this Section 6(c)(iv) is not subject toliquidation or exchange for another benefit. Notwithstanding any provision of this Agreement tothe contrary, any amounts to which the Executive would otherwise be entitled under this Section6(c)(iv) during the first six months following the date of the Employee’s Separation From Serviceshall be accumulated and paid to the Executive on the date that is six months following the date ofhis Separation From Service. All reimbursements by the Company under this Section 6(c)(iv) shallbe paid no later than the earlier of (i) the time periods described above and (ii) the last day ofthe Executive’s taxable year next following the taxable year in which the expense was incurred.     (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant toSection 6(c), the Executive becomes entitled to receive any refund with respect to such claim, theExecutive shall (subject to the Company’s complying with the requirements of Section 6(c)) promptlypay to the Company the amount of such refund (together with any interest paid or credited thereonafter taxes applicable thereto). If, after the receipt by the Executive of an amount advanced bythe Company pursuant to Section 6(c), a determination is made that the Executive shall not beentitled to any refund with respect to such claim and the Company does not notify the Executive inwriting of its intent to contest such denial of refund prior to the expiration of thirty (30) daysafter such determination, then such advance shall not be required to be repaid.     (e) Any provision in this Agreement or any other plan or agreement to the contrarynotwithstanding, if the Company is required to pay a Gross-Up Payment pursuant to the provisions ofthis Agreement and pursuant to the provisions of another plan or agreement, then the Company shallpay the total of the amounts determined pursuant to this Agreement and the provisions of such otherplan or agreement.7. Confidential Information. The Executive shall hold in a fiduciary capacity for thebenefit of the Company all secret or confidential information, knowledge or data relating to theCompany or any of its affiliated companies, and their respective businesses, which shall have beenobtained by the Executive during the Executive’s employment by the Company or any of its affiliatedcompanies, provided that it shall not apply to information which is or shall become publicknowledge (other than by acts by the Executive or representatives of the Executive in violation ofthis Agreement), information that is developed by the Executive independently of such information,or knowledge or data or information that
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is disclosed to the Executive by a third party under no obligation of confidentiality to theCompany. After termination of the Executive’s employment with the Company, the Executive shallnot, without the prior written consent of the Company or as may otherwise be required by law orlegal process, communicate or divulge any such information, knowledge or data to anyone other thanthe Company and those designated by it. In no event shall an asserted violation of the provisionof this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable tothe Executive under this Agreement.8. Disputed Payments And Failures To Pay. If the Company fails to make a payment underthis Agreement in whole or in part as of the payment date specified in this Agreement, eitherintentionally or unintentionally, other than with the consent of the Employee, the Company shallowe the Employee interest on the delayed payment at the applicable Federal rate provided for insection 7872(f)(2)(A) of the Code if the Employee (i) accepts the portion (if any) of the paymentthat the Company is willing to make (unless such acceptance will result in a relinquishment of theclaim to all or part of the remaining amount) and (ii) makes prompt and reasonable good faithefforts to collect the remaining portion of the payment. Any such interest payments shall becomedue and payable effective as of the applicable payment date(s) specified in Section 3 with respectto the delinquent payment(s) due under Section 3.9. Funding. The Executive shall have no right, title, or interest whatsoever in or to anyassets of the Company or any investments which the Company may make to aid it in meeting itsobligations under this Agreement. The Executive’s right to receive payments under this Agreementshall be no greater than the right of an unsecured general creditor of the Company. Immediatelyprior to a Change in Control, the Company shall create an irrevocable grantor trust (the “RabbiTrust”) which shall be subject to the claims of creditors of the Company. In the event that theExecutive is a Specified Employee at the time he incurs a Separation From Service or at the timethe Company determines that it is reasonably likely that the Executive will incur a Separation FromService in connection with a Change in Control, then immediately upon the Executive’s SeparationFrom Service or, if earlier, the date on which the Company makes a determination that the Executiveis reasonably likely to incur a Separation From Services in connection with a Change in Control,the Company shall transfer to the Rabbi Trust cash sufficient (on an undiscounted basis) to pay thecash amounts specified in Sections 3(a)(i)(A), 3(a)(i)(B), 3(a)(i)(C), 3(a)(i)(D) and 3(a)(i)(E),the estimated amount of the Gross-Up Payment to be made under Section 6 and the Interest Amount.The cash amounts specified in Sections 3(a)(i)(A), 3(a)(i)(B), 3(a)(i)(C), 3(a)(i)(D) and3(a)(i)(E), the Gross-Up Payment and the Interest Amount shall be paid from the Rabbi Trust on thedates specified in Sections 3 and 6 herein, provided that the Company shall remain liable to payany all amounts which for any reason are not paid from the Rabbi Trust. The trustee of the RabbiTrust shall be a bank or trust company selected by the Company and approved by the Executive (inhis sole discretion) prior to the Change in Control.10. Successors.     (a) This Agreement is personal to the Executive and shall not be assignable by the Executiveotherwise than by will or the laws of descent and distribution. This Agreement shall inure to thebenefit of and be enforceable by the Executive’s personal or legal representatives, executors,administrators, successors, heirs, distributees, devisees and legatees.     (b) This Agreement shall inure to the benefit of and be binding upon the Company and itssuccessors and assigns.     (c) In addition to any obligations imposed by law upon any successor to the Company, theCompany will require any successor (whether direct or indirect, by purchase, merger, consolidation,amalgamation, scheme of arrangement, exchange offer, operation of law or otherwise (including anypurchase, merger, amalgamation, Corporate Transaction or other transaction involving the Parent,
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Company or any subsidiary or Affiliate of the Company), to all or substantially all of theCompany’s or Parent’s business and/or the Parent’s Assets or the Company’s assets to expresslyassume and agree to perform this Agreement in the same manner and to the same extent that theCompany would be required to perform it if no such succession had taken place. Failure of theCompany to obtain such assumption and agreement prior to the effectiveness of any such successionshall be a breach of this Agreement and shall entitle the Executive to compensation from theCompany in the same amount and on the same terms as the Executive would be entitled to hereunder ifthe Executive were to terminate the Executive’s employment for Good Reason after a Change ofControl, except that, for purposes of implementing the foregoing, the date on which any suchsuccession becomes effective shall be deemed the Date of Termination. As used in this Agreement,“Company” shall mean the Company as hereinbefore defined and any successor to its business and/orassets as provided above.11. Miscellaneous.     (a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATEOF TEXAS, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS. The captions of this Agreement arenot part of the provisions hereof and shall have no force or effect. This Agreement may not beamended or modified otherwise than by a written agreement executed by the parties hereto or theirrespective successors and legal representatives.     (b) All notices and other communications hereunder shall be in writing and shall be given byhand delivery to the other party or by registered or certified mail, return receipt requested,postage prepaid, addressed as follows:   If to the Executive: James M. Hudgins  515 Post Oak Boulevard  Houston, Texas 77027   If to the Company: Weatherford International, Inc.  515 Post Oak Boulevard  Houston, Texas 77027  Attention: General Counselor to such other address as either party shall have furnished to the other in writing in accordanceherewith. Notices and communications shall be effective when actually received by the addressee.     (c) The invalidity or unenforceability of any provision of this Agreement shall not affect thevalidity or enforceability of any other provision of this Agreement.     (d) The Company may withhold from any amounts payable under this Agreement such Federal,state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law orregulation.     (e) The Executive’s or the Company’s failure to insist upon strict compliance with anyprovision of this Agreement or the failure to assert any right to the Executive or the Company mayhave hereunder, including without limitation, the right of the Executive to terminate employmentfor Good Reason shall not be deemed to be a waiver of such provision or right or any otherprovision or right of this Agreement.
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     (f) This Agreement constitutes the entire agreement and understanding between the partiesrelating to the subject matter hereof and supersedes all prior agreements between the partiesrelating to the subject matter hereof, including, without limitation, the Prior Agreements.     (g) Notwithstanding any other provision of this Agreement, no benefits or payments hereundershall be provided or paid following December 31, 2010.
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     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to theauthorization from its Board of Directors, the Company has caused these presents to be executed inits name and on its behalf, all as of the day and year first above written.                                                      /s/ JAMES M. HUDGINS   James M. Hudgins      WEATHERFORD INTERNATIONAL, INC.