Document:

Amended and Restated Non-Qualified Pension Plan for Outside Directors

 Exhibit 10.18 
  
 AMENDED AND RESTATED 
 NON-QUALIFIED PENSION PLAN 
 FOR 
 OUTSIDE DIRECTORS 
 OF TIDEWATER INC. 
  

			
	ARTICLE I - INTRODUCTION
	
	ARTICLE II - DEFINITIONS
		
	            2.1	  	Definitions
	
	ARTICLE III - PENSION BENEFITS
		
	            3.1	  	Eligibility
	            3.2	  	Time and Duration of Pension
	            3.3	  	Suspension of Pension Benefits
	            3.4	  	Deferred Compensation Plan
	            3.5	  	Amount of Pension
	            3.6	  	Forfeiture of Benefits
	            3.7	  	Payment of Benefits
	            3.8	  	Death of Participant
	
	ARTICLE IV - NON-ASSIGNABILITY OF INTERESTS
		
	            4.1	  	Non-Assignability of Interests
	
	ARTICLE V - ADMINISTRATION
		
	            5.1	  	No Funding Obligation
	            5.2	  	Applicable Law
	            5.3	  	Administration and Interpretation
	            5.4	  	Amendment
	            5.5	  	Termination
	            5.6	  	Change of Control

  
 Amended through

 May 31, 2001 

 AMENDED AND RESTATED 
 NON-QUALIFIED PENSION PLAN 
 FOR 
 OUTSIDE DIRECTORS 
 OF 
 TIDEWATER INC. 
  

  
 WHEREAS, Tidewater Inc., a Delaware corporation (the “Company”) maintains the Non-Qualified Pension Plan for
Outside Directors of Tidewater Inc. (the “Plan”), the provisions of which are at present expressed in a plan document effective March 22, 1990 and amendment thereto effective October 1, 1999; and 
  
 WHEREAS, the Board of Directors has authorized the restatement of the Plan,
as amended; 
  
 NOW THEREFORE, the Plan is hereby restated to read
in its entirety as follows: 
  
 ARTICLE I 
  
 INTRODUCTION 
  
 This Plan is established by Tidewater Inc. as a non-qualified pension plan
for the exclusive benefit of Outside Directors who are or have been members of the Board of Directors of the Company and who retire from (or otherwise cease to render service for) the Board of Directors of the Company at any time on or after April
1, 1990. 
  
 The Plan shall be maintained according to the terms
of this document, as it may be amended from time to time. The Board of Directors of the Company shall have the sole authority to amend the Plan and to resolve any dispute with respect to the interpretation and administration of the Plan. The Plan
shall be administered and interpreted by the Plan Administrator, as provided in Section 5.3 hereof. 
  
 ARTICLE II 
  
 DEFINITIONS 
  
 2.1 Definitions. When used
in this document, the following words and phrases shall have the meaning assigned to them, unless the context clearly indicates otherwise: 
  

	 	(a)	Affiliated Company means a direct or indirect subsidiary of Tidewater Inc. 

  

	 	(b)	The Company means Tidewater Inc., a Delaware corporation which maintains its principal offices in New Orleans, Louisiana. 

  

	 	(c)	Board of Directors means the Board of Directors of Tidewater Inc. 

  

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	 	(d)	Compensation Committee means the Compensation Committee of the Board of Directors or its delegate. 

  

	 	(e)	Cost of Borrowed Funds means the prime rate (at the time of reference) established by Whitney National Bank or 10% per annum, whichever is lower. 

  

	 	(f)	Death Benefit means the benefit provided by Section 3.8 hereof. 

  

	 	(g)	Emeritus Director means a person who (at the time of reference) is serving as Director Emeritus of the Company. 

  

	 	(h)	Outside Director means a person who (at the time of reference) served or is serving as a director on the Board of Directors and who, at such time, was or is not an employee
of the Company or any Affiliated Company. 

  

	 	(i)	Participant means an Outside Director who has satisfied the eligibility requirements of Section 3.1 hereof. 

  

	 	(j)	Pension means the benefit determined according to Article III hereof. 

  

	 	(k)	Plan means the Non-Qualified Pension Plan for Outside Directors of Tidewater Inc., as set forth in this document and as amended by the Board of Directors from time to time.

  

	 	(l)	Years of Service as a Director means the number of years not including partial years, (at the time of reference) that a Participant served on the Board of Directors, provided
however, that solely those periods of service as a non-employee director (and not periods of service when such director was concurrently employed by the Company or any Affiliated Company) shall be counted for purposes of eligibility and benefit
accrual under the Plan. 

  
 ARTICLE III 

 
 PENSION BENEFITS 
  
 3.1 Eligibility. A Director shall become a Participant upon (a) having
served as an Outside Director of the Company for five or more years or (b) having attained the age of 65. Additionally, notwithstanding any other provision of the Plan, any Outside Director who is serving immediately prior to a Change of Control who
is not a Participant, but who would have become a Participant had such service continued through the second anniversary of the Change of Control and had it been credited under the Plan for purposes of both the service 

  

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requirements and the age requirements for participation (but not for purposes of determining the duration of the pension), shall become a Participant upon
the occurrence of the Change of Control. 
  
 3.2 Time and
Duration of Pension. A Participant shall be entitled to a pension commencing on the first business day of the calendar quarter next following the Participant’s retirement from, or other cessation of service to, the Board of Directors after
five (or more) years of Service as an Outside Director or after having attained the age of 65. A Participant who was a member of the Board of Directors on May 31, 2001 will receive the annual Pension for a term equal to the Participant’s Years
of Service as a Director. A Participant who joins the Board of Directors after May 31, 2001 will receive the annual Pension for a term equal to the Participant’s Years of Service as a Director, but not to exceed five years. 
  
 3.3 Suspension of Pension Benefits. The payment of Pension benefits
under this Plan shall not be suspended when a Participant is serving as an Emeritus Director of the Company. The payment of Pension benefits under this Plan shall be suspended throughout any period when the Participant is serving as an Outside
Director on the Board of Directors. Subsequent to any such period of benefit suspension for service on the Board of Directors such Participant’s Pension benefit under this Plan shall be recalculated with reference to all service as an Outside
Director, including the directors’ retainer earned and the years of service accrued during such period of benefit suspension, and the Participant’s Pension benefit shall be paid or resumed at the newly calculated higher rate. 

 
 3.4 Deferred Compensation Plan. Nothing in this Plan shall affect
eligibility for or benefits under the Deferred Compensation Plan for Outside Directors of Tidewater Inc. 
  
 3.5 Amount of Pension. A Participant’s Pension, as defined in Section 3.2, shall be an annual amount equal to the annual director’s
retainer (exclusive of meeting fees or committee chairmen’s retainers) which is prevailing at the time the Participant retires from (or otherwise ceases to serve on) the Board of Directors. Notwithstanding the foregoing provisions of this
Section 3.5, if a Participant retires from (or otherwise ceases to serve on) the Board of Directors upon or after the occurrence of a Change of Control (as defined in Section 5.6 hereof), the Participant’s Pension shall be an annual amount
equal to the greater of (i) the annual director’s retainer (exclusive of meeting fees or committee chairmen’s retainers) which is prevailing at the time of such retirement or cessation of service or (ii) the annual director’s retainer
(exclusive of meeting fees or committee chairmen’s retainers) which is prevailing immediately prior to the occurrence of a Change of Control. Further, notwithstanding the provisions of Section 3.3 hereof, in the event of such a retirement or
cessation which follows a period of benefit suspension described in such Section, the rate of the Participant’s Pension shall be determined in accordance with the immediately preceding sentence, while the duration of the Pension shall be
determined in accordance with Section 3.3. 
  

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 3.6 Forfeiture of Benefits. All benefits not yet paid for which an Outside Director would be
otherwise eligible under this Plan shall be forfeited in the event that the Board of Directors determines that any of the following circumstances has occurred: 
  

	 	(a)	The Outside Director has engaged in knowing and willful misconduct in connection with his or her service as a director; or 

  

	 	(b)	The Outside Director, without the consent of the Board of Directors or any Operating Company Board, at any time during or after his or her period of service as an Outside Director,
is employed by, becomes associated with, renders service (as a director or otherwise) to, or owns an interest (other than as a shareholder with a nonsubstantial interest) in, any business which is competitive with, or which controls a business which
is competitive with the Company or any Affiliated Company. 

  
 3.7 Payment of Benefits. Unless an election is made for a lump sum payment under Section 5.6 hereof, the Pension shall be paid as a series of quarterly payments to the Participant. The quarterly payments shall
commence on the date provided in Section 3.2 (or Section 3.3, as the case may be) and shall continue on the first business day of each calendar quarter thereafter for the duration of the Pension as provided in Section 3.2 hereof (or Section 3.3, as
the case may be). It shall be a condition to the payment of the Pension to a Participant that for the duration of the Pension that the Participant remain available for consultation with the Company. 
  
 3.8 Death of Participant. If a Participant dies prior to payment of
all of the Participant’s Pension, a Death Benefit shall be paid to the beneficiaries designated by him (or, if no designation is made, then to his estate). The amount of the Death Benefit shall be the remaining Pension benefit that would have
been paid to the Participant had he lived, discounted by the Company’s then prevailing Cost of Borrowed Funds on the date of the Participant’s death. Any beneficiary designation, or change in the beneficiary designation shall be made in
writing by completing and furnishing to the Plan Administrator a Beneficiary Designation form in the form attached hereto as Exhibit I. The last Beneficiary Designation Form received by the Plan Administrator shall be controlling over any
testamentary or purported disposition by the participant, provided that no designation, or change of designation thereof shall be effective unless received by the Plan Administrator prior the death of the Participant. 
  
 ARTICLE IV 
  
 NON-ASSIGNABILITY OF INTERESTS 
  
 4.1 Non-Assignability of Interests. The interests herein and the right to receive benefits hereunder may not be
anticipated, alienated, sold, transferred, assigned, pledged, encumbered, or 

  

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subjected to any charge or legal process, and if any attempt is made to do so, or a Participant becomes bankrupt, the interests under the Plan of the person
affected may be terminated by the Board of Directors, which, in its sole discretion, may cause the same to be held or applied for the benefit of one or more of the dependents of such person or make any other disposition of such interests as it deems
appropriate. 
  
 ARTICLE V 
  
 ADMINISTRATION 
  
 5.1 No Funding Obligation. The obligation of the Company to pay any
benefits under this Plan shall be unfunded and unsecured and any payments under this Plan shall be made from the Company’s general assets. 
  
 5.2 Applicable Law. This Plan shall be construed and enforced in accordance with the laws of the State of Louisiana. 
  
 5.3 Administration and Interpretation. The Company’s Director of
Employee Relations (the “Plan Administrator”) shall have the authority and responsibility to administer and interpret this Plan. Benefits due and owing to an Outside Director under the Plan shall be paid when due without any requirement
that a claim for benefits be filed. However, Outside Directors who have not received the benefits to which they feel entitled may file a written claim with the Plan Administrator, who shall act on the claim within thirty days. The Plan
Administrator’s action on any such claim may be appealed by the claimant to the Company’s Board of Directors. Notwithstanding the immediately preceding sentence, no amendment of the Plan made upon or after the occurrence of a Change of
Control shall affect detrimentally the rights or benefit under the Plan of any Participant (including any Outside Director who becomes a Participant upon a Change of Control and including any Participant who has retired from (or otherwise ceased to
serve on) the Board of Directors). 
  
 5.4 Amendment. The
Board of Directors may from time to time amend this Plan or any provision herein. 
  
 5.5 Termination. The Company has established this Plan with the intention and expectation that the Plan will continue in force. However, the Company reserves the right to terminate the Plan at any time for any
reason. 
  
 5.6 Change of Control. 
  
 (a) Distribution following a Change of Control.
Notwithstanding any other provision of the Plan, a Participant may elect at any time prior to a Change of Control, in a form and manner reasonably satisfactory to the Company, to receive upon the Participant’s retirement from, or other
cessation of service to, the Board of Directors following or simultaneous with a Change of Control, the present value of any Pension accrued by a Participant (including any Outside Director who becomes a 

  

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Participant upon a Change of Control and including any Participant who has retired from (or otherwise ceased to serve on) the Board of Directors) under the
Plan, but not yet paid, shall be distributed to the Participant immediately in a lump sum, calculated by using the Company’s then prevailing Cost of Borrowed Funds for the discount rate. 
  
 (b) Definition of Change of Control. As used in this
Section 5.6, ‘Change of Control’ shall mean: 
  
 (i) the acquisition by any ‘Person’ (as defined in Section 5.6(c) hereof) of ‘Beneficial Ownership’ (as defined in Section 5.6(c) hereof) of 30% or more of the outstanding Shares of the Company’s Common Stock, $0.10
par value per share (the ‘Common Stock’) or 30% or more of the combined voting power of the Company’s then outstanding securities; provided, however, that for purposes of this subsection 5.6(b)(i), the following shall not constitute a
Change of Control: 
  
 (A) any acquisition
(other than a ‘Business Combination’ (as defined in Section 5.6(b)(iii) hereof) which constitutes a Change of Control under Section 5.6(b)(iii) hereof) of Common Stock directly from the Company, 
  
 (B) any acquisition of Common Stock by the Company or its
subsidiaries, 
  
 (C) any acquisition of Common
Stock by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or 
  
 (D) any acquisition of Common Stock by any corporation pursuant to a Business Combination which does not constitute a Change of Control
under Section 5.6(b)(iii) hereof; or 
  
 (ii)
individuals who, as of the effective date of this amendment to the Plan, constitute the Board (the ‘Incumbent Board’) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a
director subsequent to the effective date of this amendment to the Plan whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board
shall be considered a member of the Incumbent Board, unless such individual’s initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other than the Incumbent Board; or 
  

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 (iii) consummation of a reorganization, merger or consolidation (including a merger or
consolidation of the Company or any direct or indirect subsidiary of the Company), or sale or other disposition of all or substantially all of the assets of the Company (a ‘Business Combination’), in each case, unless, immediately
following such Business Combination, 
  
 (A) the
individuals and entities who were the Beneficial Owners of the Company’s outstanding Common Stock and the Company’s voting securities entitled to vote generally in the election of directors immediately prior to such Business Combination
have direct or indirect Beneficial Ownership, respectively, of more than 50% of the then outstanding shares of common stock, and more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the
election of directors, of the Post-Transaction Corporation (as defined in Section 5.6(c) hereof), and 
  
 (B) except to the extent that such ownership existed prior to the Business Combination, no Person (excluding the Post-Transaction
Corporation and any employee benefit plan or related trust of either the Company, the Post-Transaction Corporation or any subsidiary of either corporation) Beneficially Owns, directly or indirectly, 30% or more of the then outstanding shares of
common stock of the corporation resulting from such Business Combination or 30% or more of the combined voting power of the then outstanding voting securities of such corporation, and 
  
 (C) at least a majority of the members of the board of directors of the Post-Transaction Corporation were
members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or 
  
 (iv) approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

  
 (c) Other Definitions. As used in
Section 5.6(b) hereof, the following words or terms shall have the meanings indicated: 
  
 (i) Affiliate: ‘Affiliate’ (and variants thereof) shall mean a Person that controls, or is controlled by, or is under common
control with, another specified Person, either directly or indirectly. 
  
 (ii) Beneficial Owner: ‘Beneficial Owner’ (and variants thereof), with respect to a security, shall mean a Person who, directly or indirectly (through any contract, understanding, relationship or otherwise),
has or shares 

  

 -7- 

 
(i) the power to vote, or direct the voting of, the security, and/or (ii) the power to dispose of, or to direct the disposition of, the security. 

 
 (iii) Person: ‘Person’ shall mean a natural
person or company, and shall also mean the group or syndicate created when two or more Persons act as a syndicate or other group (including, without limitation, a partnership or limited partnership) for the purpose of acquiring, holding, or
disposing of a security, except that ‘Person’ shall not include an underwriter temporarily holding a security pursuant to an offering of the security. 
  
 (iv) Post-Transaction Corporation: Unless a Change of Control includes a Business Combination (as defined in
Section 5.6(b)(iii) hereof), ‘Post-Transaction Corporation’ shall mean the Company after the Change of Control. If a Change of Control includes a Business Combination, ‘Post-Transaction Corporation’ shall mean the corporation
resulting from the Business Combination unless, as a result of such Business Combination, an ultimate parent corporation controls the Company or all or substantially all of the Company’s assets either directly or indirectly, in which case,
‘Post-Transaction Corporation’ shall mean such ultimate parent corporation. 
  
 Executed effective the 31st day of May, 2001. 
  

			
	Tidewater Inc.
		
	By:	 	 /s/ Cliffe F. Laborde

	 	 	 Cliffe F. Laborde

	 	 	 Executive Vice President,

	 	 	 Secretary and General Counsel

  
 Attest: 
  

			
	By:	 	 /s/ Michael L. Goldblatt

	 	 	Michael L. Goldblatt
	 	 	Assistant Secretary

  

 -8-Amended and Restated Management Annual Incentive Plan

 Exhibit 10.19 
  
 SUMMARY PROVISIONS 
 OF THE 
 AMENDED AND RESTATED 
 TIDEWATER INC. 
 MANAGEMENT ANNUAL INCENTIVE PLAN 
 (MAIP) 
  
 WHEREAS, Tidewater,
Inc., a Delaware corporation (the “Company”), desires to amend the Tidewater Inc. Management Annual Incentive Plan (the “MAIP”) for fiscal year 2005 to allow payment of bonus awards at the time that the Company publicly releases
its annual earnings. 
  
 NOW, THEREFORE, pursuant to the power
provided to the Compensation Committee of the Board of Directors under Article X of the MAIP, Article VII of the MAIP is hereby amended to read as set forth herein and, as so amended, the MAIP is hereby restated in its entirety as follows:

  

	I.	PLAN OBJECTIVE 

  
 The primary objective of the Management Annual Incentive Plan (MAIP) is to assist in achieving specific business and financial goals conducive to the
organization’s success which the Company believes can best be accomplished by providing cash incentives to key Tidewater employees. 
  
 The MAIP helps prioritize and focus efforts on the accomplishment of financial goals and other corporate objectives established each year through the
annual planning and budgeting process. This is achieved by linking a significant element of annual compensation to the accomplishments of selected goals. At target performance levels, the MAIP provides incentive compensation opportunities which, in
conjunction with base salary, will yield competitive total compensation levels. 
  

	II.	BASIC PLAN CONCEPT 

  
 The plan concept focuses primarily on the performance of Tidewater overall. The MAIP is comprised of two divisions which will enable the Company to better
measure performance results of eligible participants by specific areas of responsibility. The two divisions are as follows: 
  

	 	•	 	Administrative 

  

	 	•	 	Marine 

  
 Overall corporate performance is considered each year along with certain divisional and individual performance measures specific to each division’s operations and functions. Regardless of corporate performance,
however, the Compensation Committee of the Board of Directors may at its discretion 

 
establish a funding pool of up to 50% of the target awards for all participants in order to allow awards for outstanding individual contributions even if the
Company does not achieve threshold performance on plan performance measures within a year. 
  

	III.	ELIGIBILITY CRITERIA 

  
 Eligibility for participation in the MAIP will be limited to officers and certain key employees that directly impact the Company’s financial
performance and who do not participate in another Company bonus plan. The specific positions eligible to participate in the plan will be reviewed and determined annually by Tidewater’s Chief Executive Officer and the Compensation Committee of
the Board of Directors. 
  

	IV.	AWARD OPPORTUNITIES 

  
 Prior to the beginning of each fiscal year, Tidewater will specify target incentive awards for each eligible position. Prior to the beginning of each
fiscal year, Tidewater will determine the total pool target, threshold and maximum incentive award amounts. These amounts are determined from each eligible participant’s base salary times the target percent associated with the
participant’s position within the Company. The actual target percent is determined based upon the employee’s relevant position within the Company and the measurable amount of direct influence on the Company’s financial performance.
Base target percents by position are as follows: 
  

						
	 	  	Base
Target %

	 	 	 
	 A.         Administrative
	  	 	 	 	 
			
	 Executive Vice President
	  	95	%	 	 
	 Executive Vice President, CFO & Treasurer
	  	95	%	 	 
	 Vice President & Principal Accounting Officer
	  	70	%	 	 
	 Corporate Controller
	  	50	%	 	 
	 Director - Corporate Taxation
	  	30	%	 	 
			
	 B.         Marine
	  	 	 	 	 
			
	 Senior Vice President
	  	80	%	 	 
	 Vice President – Operational Areas
	  	70	%	 	 
	 Regional Manager
	  	62.5	%	 	 
	 Area Manager (A)
	  	55	%	 	 
	 Director - Health, Safety, and Environmental Management
	  	55	%	 	 
	 Vice President – International Sales
	  	55	%	 	 
	 Vice President – Technical Services and Engineering
	  	55	%	 	 
	 Area Manager (B)
	  	45	%	 	 
	 Regional Finance Director (BF)
	  	40	%	 	 
	 Vice President – Domestic Sales
	  	45	%	 	 
	 Area Manager (C)
	  	35	%	 	 
	 Regional Finance Director (CF)
	  	30	%	 	 
	 Manager – Domestic Sales
	  	27.5	%	 	 
	 Manager – International Sales
	  	27.5	%	 	 

  

 2 

	V.	PERFORMANCE MEASURES AND STANDARDS 

  
 Prior to the start of each fiscal year, specific corporate and divisional measures and standards will be established. In addition, the appropriate
weighing to each measurement will also be established. 
  
 PERFORMANCE MEASURES 
  

	 	A.	Except as provided in Section II of this MAIP, before any individual incentive amount can be awarded, the Company must first achieve minimum (threshold) performance in at least one
of two Company performance measures. For fiscal year 2005, Company performance measures are: 

  

	 	1.	Adjusted Net Income vs. Budget –Under this test, net income as compared with budgeted net income, adjusted for selected charges/credits of an unusual nature which would not be
subject to normal budgeting procedures, is used. The net income test is a measurement test comparing actual results against budgeted results for the year. 

  
 Note: The Company’s adjusted net income must be at least 50% of the budgeted net income, in order for the
minimum (threshold) award to be paid. 
  
 For fiscal year
2005, this performance measurement will carry a weight of 66.67%. 
  
 In order to have the incentive pay program not inhibit good management/business decisions, certain adjustments to net income should be made in determining if the net income test has been met. Such adjustments should
be objectively determinable to avoid the appearance of impropriety. Accordingly, the following items as reported in the corporation’s consolidated statement of earnings should be added to or subtracted from net income as reported in order to
determine net income for purposes of the incentive pay plan: 
  
 Cumulative effect of accounting changes; 
  

 3 

 Extraordinary items; 
 Discontinued operations; and 
 Unusual or infrequently occurring items (less the amount of related income taxes) as that term is used in Accounting Principles Board Opinion No. 30. 
  

NOTE: For purposes of calculating achievement of this performance measure, budgeted net income shall be divided by the average number of common
shares outstanding for the year as contemplated by the budget. Likewise, the amount of Adjusted Net Income shall be divided by the average number of common shares outstanding during the year. For purposes of making both of these Earnings Per Share
calculations, common stock equivalents shall not be considered in determining the average number of common shares outstanding. 
  

	 	2.	Return of Total Capital (ROTC) – Under this performance measurement, the Company must attain at least the 40th percentile when compared to the Peer Group (see Exhibit 1) on Return of Total Capital (ROTC). ROTC is defined as: 

  
 Earnings Before Interest Expenses, Taxes, 
 Depreciation and Amortization
(EBITDA)                     
 Average Shareholders Equity + Average Long-Term Debt 
 (including current maturities of Long-Term Debt) 
  
 NOTE: Average shareholders’ equity and average long-term debt
shall be determined by summing the respective totals as of the end of each interim quarterly reporting period during the fiscal year as shown on the Company’s consolidated balance sheet and dividing such sums by the number of interim reporting
periods. 
  
 The standard for the ROTC performance measure will
be established by considering Tidewater’s performance against the Peer Group of companies (see Exhibit 2). When determining peer group performance ranking, pro-rating is not permitted below the 40th percentile. 
  
 For fiscal year 2005, this performance measurement will carry a weight of 33.33%. 
  
 STANDARDS FOR EACH DIVISION 
  

	 	A.	 Although overall Company performance determines the maximum funding of the pool, each participant, within each division, will have specific standards established
for the accomplishment of certain 

  

 4 

 
Company and individual performance measures. These criteria will be established annually, prior to the beginning of each fiscal year, and will be used
to determine the amount of the incentive award that each participant will be eligible to receive. The amount of bonus actually awarded to the participant depends upon his (her) achievement of the Company and individual performance
criteria. For Fiscal Year 2005, the performance measures for each division are as follows: 
  

	 	1.	Administrative 

  

	 	a.	Return on Total Capital – As defined above, this measurement will carry a weight of 25% of the individual’s total award. 

  

	 	b.	Adjusted Net Income –As defined above, this measurement will carry a weight of 25% of the individual’s total award. 

  

	 	c.	Individual Performance – This measurement is determined on a subjective basis and will carry a weight of 25% of the individual’s total award.

  

	 	d.	Safety Performance – This measurement is determined by achievement of the Company’s overall established safety performance goals for the fiscal year. The safety
performance measurement will carry a weight of 25% of the individual’s total award. 

  

	 	2.	Marine 

  

	 	a.	Safety Measurement – This measurement will be considered in four parts. 

  

	 	1.	First, each area will be given a specific goal to achieve during the fiscal year with respect to safety performance as it relates to Total Recordable Incident Rates. Each area will
be graded on how well it performs toward achieving the assigned goals. Total Recordable Incident Rate will be defined as follows: 

  
 Loss Time Accidents 
  

			
	Plus	  	Recordable incidents
		
	Multiplied by	  	200,000 (manhours)
		
	Divided by	  	Total manhour exposure
		
	Equals	  	Total Recordable Incident Rate per 200,000 manhours of exposure

  

 5 

 Attached as Exhibit 3, are the Safety Total Recordable Incident Rate goals for Fiscal 2005. 

 

	 	2.	The second component of this measurement is related to property damage. For fiscal 2005, property damage performance will be measured by applying a subjective review of overall
property damage results for the fiscal year. Only property damage above the $100,000 per occurrence deductible will be included for measurement purposes. Property damage claims will be adjusted to include only Hull (excluding machinery), Marine
Liability and Pollution claims. In other words, preventable property damage claims. This type of information will form the basic parameters that will be reviewed and considered for fiscal 2005 results. 

  

	 	3.	The third component of this measurement is related to pollution incidents. For fiscal 2005, any pollution incident must be reported to the Insurance and Claims Department. The
number and severity of pollution incidents will be measured by applying a subjective review of overall pollution incidents for the fiscal year. The Safety Director will provide quarterly updates on the reported incidents. 

 

	 	4.	Fourth, each area is evaluated on its own overall safety performance, taking into consideration such things as number of deaths and/or disabilities within an area, Lost Time
Accidents, incident ratios, nature of accidents, preventable accidents etc. Non-job related deaths will not count as an LTA. 

  
 Note: Within this weighing (1, 2, 3 & 4 above), personnel safety will comprise 60%, property damage 10%, pollution incidents 5%, and overall safety
performance 25%. 
  
 Notwithstanding the above, no allocation
under this measurement is provided unless the Company achieves its overall established safety performance goals for the fiscal year. The safety measurement will carry a weight of 33.33% of the individual’s total award. 
  

 6 

 (Note: How well each area demonstrates its commitment to Tidewater’s safety program overall will
be part of the individual performance measurement.) 
  

	 	b.	Pre-tax Earnings Test – Under this test, pre-tax earnings, as defined, as compared with a budgeted pre-tax earnings goal, will be used to determine a component of the
individual’s incentive pay. The pre-tax earnings test will be an operating area specific test, adjusted for an allocation of corporate and marine overhead (as defined), and carry a weight of 33.33% of the individual’s total award.
This test will not be considered achieved if the operating area does not provide a positive actual pre-tax earnings amount, even though the area may meet its budgeted pre-tax earnings goal. Pre-tax earnings for this purpose will be defined as
follows: 

  
 Area Revenues from all operating
activities as reported in the corporation’s consolidated income statement. 
  

			
	Minus	    	Area Operating Costs and Expenses, as reported in the corporation’s consolidated income statement.
		
	Minus	    	Area General and Administrative Expenses as reported in the corporation’s consolidated income statement.
		
	Plus/Minus	    	Area Other Income/Expenses, including gains/losses on asset sales, other income, equity in joint venture earnings, minority interests in less than 100% owned consolidated subsidiaries,
interest income, depreciation and amortization expense and foreign exchange gains/losses as reported in the corporations consolidated income statement.
		
	Minus	    	Area Capitalized Repair and Maintenance Costs.
		
	Minus	    	An allocation, based upon the insured value of vessels in the Area versus the total insured value of the company’s marine fleet, of corporate overhead expenses (G&A costs,
depreciation expense and other expenses), marine overhead costs (G&A costs, depreciation expense, inventory adjustment and other

  

 7 

			
	 	    	expenses), costs of vessels withdrawn from service and held for sale, net cost of Pental Insurance and interest and debt cost as these items are reported in the corporation’s
consolidated income statement.
		
	Equals	    	Pre-tax earnings, as defined.

  
 In order to have the
incentive pay program not inhibit good management/business decisions, certain adjustments to pre-tax earnings should be made in determining if the net income test has been met. Such adjustments should be objectively determinable to avoid the
appearance of impropriety. Accordingly, the following items as reported in the corporation’s consolidated statement of earnings should be added to or subtracted from net income as reported in order to determine net income for purposes of the
incentive pay plan: 
  
 Cumulative effect of accounting changes;

 Extraordinary items; 
 Discounted operations; and 
 Unusual or infrequently occurring items (less the amount of related income taxes) as that term is used
in Accounting Principles Board Opinion No. 30. 
  
 The Pre-tax
Earnings Test component will be replaced with a more relevant test for those participants identified below who do not have direct operating area responsibilities. 
  
 Director—Health, Safety, and Environmental Management 
 Manager—Domestic Sales 
 Manager—International Sales 
 Manager—Special Vessel Services 
 President/ General Manager – Quality Shipyards 
 Vice President – Domestic Sales 
 Vice President—International Sales 
 Vice-President—Technical Services & Engineering 
  
 These tests will encompass up to five objective criteria that have been approved by the immediate supervisor specific for that fiscal year. (See Exhibit
4). 
  

	 	c.	Individual Performance – Individual performance is determined annually and is based upon a subjective evaluation by the participant’s manager(s) and encompasses the
overall performance of the individual for the fiscal year. 

  

 8 

 Individual performance will also include an evaluation of each area’s commitment to
Tidewater’s safety program overall. This measurement will carry a weight of 33.34% of the individual’s total award. 
  
 Included as part of the individual performance measure may be an area specific test. This test may be optional by area and would consist of zero to two
specific criteria relevant to a given area. Each participant will be advised of any specific test for that fiscal year. Some examples would be the percent improvement in receivables over a period of time, delinquent receivables collected, revenue
enhancement achieved over a period of time, utilization, or other such criteria as deemed appropriate. When an area specific test is utilized, the particular measurement will be weighted as part of the individual performance weight. 
  

	VI.	AWARD CALCULATIONS 

  

	 	A.	Development of Incentive Funding Pool 

  
 The actual amount of the incentive pool to be awarded depends upon the attainment of specified corporate performance measures as set forth in Section V-A.
Each corporate measurement will operate independently of one another in creating the funding pool for annual incentive awards. Thus, the Company could achieve above threshold on one performance measure and below threshold on another performance
measure and still have funds available in the annual incentive pool. 
  
 Exhibit 2, attached, provides a matrix example of how the size of the incentive funding pool would be calculated at different levels of corporate performance. 
  
 The Matrix also shows: 
  

	 	•	 	The percentage of aggregate target incentives paid for all plan participants; and 

  

	 	•	 	The total amount of money allocated to the incentive funding pool for fiscal 2005. 

  

	 	•	 	The greater emphasis for fiscal year 2005 is placed upon the Adjusted net Income performance measures. As such, the payouts under that measurement are more than twice that of the
ROTC component. 

  

 9 

	 	B.	Individual Awards. 

  
 The incentive funding pool is allocated to individual plan participants by the performance measures set forth in Section V-B. 
  
 Each division will also be looked at independently of one another;
therefore, it is possible for a Division to receive individual awards for meeting performance criteria and not the other if it does not reach its performance criteria. However, the overall corporate performance measures must be positive before
consideration of any incentive awards. 
  
 The size of each
divisional incentive pool is based upon the number of eligible participants in each division. For example, if the Company meets target goals, each participant’s annual base salary is multiplied by the participant’s target percent amount.
All target amounts are then added together to produce the total pool for that division. Each divisional pool would be adjusted based upon the actual results of the overall corporate performance measurements. 
  

	VII.	AWARD PAYMENTS 

  
 Awards will be payable in cash, as soon as administratively possible following the time that the Company’s earnings for the fiscal year are released
to the public. 
  

	VIII.	TRANSFERS 

  
 In the event that a participant transfers from one position to another during the course of the year, his/her award for the year will be calculated on a pro-rata basis according to the proportion of time spent in each
position during the year. 
  

	IX.	RETIREMENTS AND TERMINATIONS 

  
 To receive an award under the MAIP, the participant must be actively employed on the last day of the performance cycle. At the discretion of the Chief
Executive Officer and with the approval of the Compensation Committee of the Board of Directors, a participant who separates from service prior to the end of the performance cycle may be granted an award. The amount of the award, if any, will be
based in part upon the length of time employed during the performance cycle. 
  

	X	PLAN ADMINISTRATION, MODIFICATION, AND ADJUSTMENT 

  
 The MAIP will be administered by Tidewater’s Chief Executive Officer, who may delegate certain elements of program administration to the Chief
Financial Officer and the Director of Employee Benefits. Actual performance goals, standards, and award determinations will be approved by the Compensation Committee of the Board of Directors. 
  

 10 

 Exhibit 1 
  
 TIDEWATER INC. 
  
 Peer Group List 
 For Return on Total Capital Performance Objective 
 Fiscal Year 2005 
  
 The following list of companies represents the Industry Peer Group for the fiscal year. 
  
 COMPANY NAME 
  
 BJ Services 
 Baker Hughes 
 Cal Dive International 
 Cooper Cameron 
 Diamond Offshore Drilling Inc. 
 ENSCO
International 
 Global Industries Ltd. 
 GlobalSantaFe Corporation 
 Gulfmark Offshore Inc. 
 Haliburton Company 
 Helmerich & Payne 
 Input/Output Inc. 
 Nabors Industries 
 Noble Corporation 
 Parker Drilling 

Rowan Companies 
 Schlumberger Ltd.

 Seacor Smit Inc. 
 Smith
International Inc. 
 TETRA Technologies 
 Tidewater Inc. 
 Transocean Sedco Forex 
 Trico Marine Services Inc. 
 Weatherford International 
  
 The above Peer Group list will be updated at the beginning of each fiscal
year. The effect of mergers and acquisitions within the peer group for purposes of excluding any given company in the year will also be considered. 
  

 11

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