This excerpt taken from the WFT DEF 14A filed Jan 15, 2009.
Preferential Subscription Rights and Advance Subscription Rights
Under the Swiss Code, the prior approval of a general meeting of shareholders is required to authorize, for later issuance, the issuance of registered shares, or rights to subscribe for, or convert into, registered shares (which rights may be connected to debt instruments or other obligations). In addition, the existing shareholders will generally have preferential subscription rights in relation to such registered shares for authorized share capital and conditional share capital or advance subscription rights in relation to such rights for conditional share capital in proportion to the respective par values of their holdings.
If the general meeting of shareholders has approved the creation of authorized capital, it may thereby delegate the decision whether to withdraw or limit the preferential subscription rights for cause to the board of directors. Weatherford-Switzerlands articles of association provide for this delegation with respect to Weatherford-Switzerlands authorized share capital in the circumstances described below under Authorized Share Capital. Furthermore, the advance subscription rights and preferential subscription rights of shareholders shall be excluded in connection with the issuance of any shares or rights with respect to Weatherford-Switzerlands conditional share capital in the circumstances described below under Conditional Share Capital.
Authorized Share Capital. The board of directors is authorized to withdraw or limit the preferential subscription rights with respect to the issuance of registered shares from the authorized capital for cause, in particular if:
Conditional Share Capital. In connection with the issuance of bonds, notes, warrants or other financial instruments or contractual obligations convertible into or exercisable or exchangeable for Weatherford-Switzerland registered shares, the advance subscription rights and the preferential subscription rights of shareholders are excluded with respect to registered shares issued from Weatherford-Switzerlands conditional share capital and to the relevant bond, note or other right issued by the company.