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## TIDEWATER INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended March 31, 2010, 2009, and 2008 

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: 

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With limited exceptions, the company is no longer subject to tax audits by state, local or foreign taxing authorities for years prior to 2002. The company has ongoing examinations by various state and foreign tax authorities and does not believe that the results of these examinations will have a material adverse effect on the company’s financial position or results of operations. 

The company receives a tax benefit that is generated by certain employee stock benefit plan transactions. This benefit is recorded directly to additional paid-in-capital and does not reduce the company’s effective income tax rate. The tax benefit for the years ended March 31, 2010, 2009 and 2008 totaled approximately $0.1 million, $1.7 million and $5.8 million, respectively. 

## (4) LONG-TERM DEBT 

## Senior Notes 

At March 31, 2010 and 2009, the company had $300.0 million outstanding of senior unsecured notes that were issued in July 2003. The multiple series of notes were originally issued with maturities ranging from seven years to 12 years and had a weighted average remaining life of 2.85 years as of March 31, 2010. These notes can be retired in whole or in part prior to maturity for a redemption price equal to the principal amount of the notes redeemed plus a make-whole premium. The weighted average interest rate on the notes is 4.35%. The terms of the notes provide for a maximum ratio of consolidated debt to total capitalization of 55%. The fair value of this debt at March 31, 2010 and 2009 was estimated to be $314.8 million and $289.4 million, respectively. The first note matures July 2010 in the amount of $25.0 million. 

The following table summarizes long-term debt outstanding at March 31, 2010 and 2009: 

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## Revolving Credit Agreement 

In July 2009, the company executed an amended and restated revolving credit agreement increasing its borrowing capacity to $450.0 million and extending its maturity to July 2012. Borrowings under the amended revolving credit facility bear interest at the company’s option at the greater of (i) prime or the federal funds rate plus 2.0 to 3.0%, or (ii) Eurodollar rates plus margins ranging from 3.0 to 4.0%, based on the company’s consolidated funded debt to total capitalization ratio. Commitment fees on the unused portion of this facility are in the range of 0.50 to 0.75% based on the company’s funded debt to total capitalization ratio. The amended facility provides for a maximum ratio of consolidated debt to consolidated total 

