TIDEWATER INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended March 31, 2010, 2009, and 2008  The company has previously reported in its periodic filings that it was in discussions with Sonangol, the  national oil company of Angola, regarding a Sonangol proposal to increase its control over Sonatide Marine  Services Ltd., an Angolan joint venture between Sonangol and a Tidewater subsidiary. The company  currently has an indirect 49% ownership interest in Sonatide. The company also previously reported that it  had reached agreement with Sonangol on certain amendments to the joint venture agreement that would  increase Sonangol’s control over the operations of Sonatide. Thereafter, Sonangol and the company  continued to have dialogue regarding additional changes proposed by Sonangol to Sonatide’s practices and  procedures that, if adopted, would further Sonangol’s control over Sonatide’s day-to-day operations,  including treasury functions. In December, 2009, Sonangol notified Tidewater that the existing joint venture  agreement, which was scheduled to expire on July 31, 2010 unless renewed, would not be renewed by  Sonangol, although Sonangol advised that it was willing to discuss a new joint venture agreement. The  company is in constructive discussions with Sonangol regarding the terms of a new joint venture  arrangement although no assurances can be given that these discussions will be successfully concluded or  whether such terms will be advantageous to the company. In addition, over the course of the last several  months Sonangol has been willing to extend the term of the Sonatide joint venture to fulfill several new or  renewed charterparty agreements with customers for a substantial portion of the current fleet in Angola that  extend beyond July 31, 2010. Failing to further extend the existing Sonatide joint venture or reach a new  joint venture agreement with Sonangol could impair the company's ability to continue to effectively compete  for business in Angola in the future. More Tidewater vessels are deployed in Angola than in any of  Tidewater’s other countries of operation, and a significant portion of revenues derived from the company’s  largest customer, Chevron, are derived through the company’s operations in Angola.  operations or cash flows. It is possible that if agreement is not reached, the DOJ may bring enforcement  action against the company. Various legal proceedings and claims are outstanding which arose in the ordinary course of business. In  the opinion of management, the amount of ultimate liability, if any, with respect to these actions will not have  a material adverse effect on the company’s financial position, results of operations, or cash flows.  The company has been made a defendant in several lawsuits in various areas of the world where its marine  vessel operations are conducted, including a class action styled suit in California, alleging certain labor and  wage and hour law violations claimed by certain current and former employees. During the first quarter of  fiscal 2008, the company provided $3.0 million for a court-approved settlement of the California wage issue  during fiscal 2008, which was inclusive of interest and attorney fees. Plaintiffs to the class action suit had  until January 2008 to submit a notice of claim. The majority of plaintiffs responded to the settlement and the  matter closed in March 2008 when full and final settlements were paid. No additional accruals were needed  for this matter. The company measures on a recurring basis and records at fair value investments held by participants in a  supplemental executive retirement plan, a deferred supplemental savings plan and a multinational savings  plan. These investments are valued based on quoted market prices (Level 1) and significant observable  inputs (Level 2) and were carried at $27.3 million and $19.7 million at March 31, 2010 and 2009,  respectively. The company’s primary financial instruments consist of cash and cash equivalents, trade receivables and  trade payables whose book values are considered to be representative of their respective fair values. The  Other Financial Instruments  Assets and Liabilities Measured at Fair Value on a Recurring Basis  (11) FAIR VALUE MEASUREMENTS  Legal Proceedings  Sonatide F-38