10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2010

GULFMARK OFFSHORE, INC.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)

001-33607
(Commission file number)

76-0526032
(I.R.S. Employer Identification No.)

10111 Richmond Avenue, Suite 340, Houston, Texas	77042
(Address of principal executive offices)	(Zip Code)

(713) 963-9522
(Registrant’s telephone number, including area code)

      Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

YES ý       NO o

      Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

YES ý      NO o

      Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check One):

Large accelerated filer ý  Accelerated filer o  Non-accelerated filer   o
(Do not check if a smaller reporting company) Smaller reporting company o 

      Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES o       NO ý

      Number of shares of Class A Common Stock, $0.01 par value, outstanding as of October 26, 2010: 26,197,329

(Exhibit Index Located on Page 28)

GulfMark Offshore, Inc.
Index

			Page
			Number
Part I.	Financial Information
	Item 1	Financial Statements		3
		Unaudited Condensed Consolidated Balance Sheets		3
		Unaudited Condensed Consolidated Statements of Operations		4
		Unaudited Condensed Consolidated Statement of Stockholders’ Equity		5
		Unaudited Condensed Consolidated Statements of Cash Flows		6
		Notes to the Unaudited Condensed Consolidated Financial Statements		7
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
	Item 3	Quantitative and Qualitative Disclosures About Market Risk		24
	Item 4	Controls and Procedures		25
Part II.	Other Information
	Item 1A	Risk Factors		25
	Item 6	Exhibits		27
	Signatures			27
	Exhibit Index			28
EX-10.1
EX-10.2
EX-10.3
EX-31.1
EX-31.2
EX-32.1
EX-32.2
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

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PART 1.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

GULFMARK OFFSHORE, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

		September 30,		December 31,
		2010		2009
	(In thousands, except par value amount)
ASSETS
Current assets:
Cash and cash equivalents	$	87,941		$	92,079
Trade accounts receivable, net of allowance for doubtful accounts of $516 in 2010 and $334 in 2009		80,604			76,554
Other accounts receivable		7,590			4,235
Prepaid expenses and other		16,557			12,206
Total current assets		192,692			185,074
Vessels and equipment at cost, net of accumulated depreciation of $268,908 in 2010 and $239,518 in 2009		1,202,595			1,164,067
Construction in progress		3,422			40,349
Goodwill		31,691			129,849
Fair value hedges		-			6,886
Intangibles, net of accumulated amortization of $6,487 in 2010 and $4,325 in 2009		28,111			30,273
Deferred costs and other assets		16,077			9,161
Total assets	$	1,474,588		$	1,565,659
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	33,333		$	33,333
Accounts payable		20,190			19,519
Income taxes payable		4,948			4,815
Accrued personnel costs		22,392			26,312
Accrued interest expense		2,662			5,966
Other accrued liabilities		10,871			7,088
Total current liabilities		94,396			97,033
Long-term debt		311,412			326,361
Long-term income taxes:
Deferred tax liabilities		107,036			112,960
Other income taxes payable		18,606			24,029
Fair value hedges		-			6,886
Cash flow hedges		7,942			6,422
Other liabilities		7,613			4,500
Stockholders’ equity:
Preferred stock, no par value; 2,000 authorized; no shares issued		-			-
Class A Common stock, $0.01 par value; 60,000 shares authorized; 26,215 and 25,906 shares issued and 25,959 and 25,697 shares outstanding, respectively; Class B Common Stock $.01 par value; 60,000 shares authorized; no shares issued		258			255
Additional paid-in capital		367,933			362,022
Retained earnings		521,232			571,213
Accumulated other comprehensive income		38,511			54,005
Treasury stock		(7,202	)		(5,865	)
Deferred compensation expense		6,851			5,838
Total stockholders’ equity		927,583			987,468
Total liabilities and stockholders’ equity	$	1,474,588		$	1,565,659

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GULFMARK OFFSHORE, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2010			2009			2010			2009
	(In thousands except per share amounts)
Revenue	$	94,479		$	90,764		$	271,912		$	304,215
Costs and expenses:
Direct operating expenses		41,729			39,508			127,456			119,122
Drydock expense		7,242			6,398			20,365			11,278
General and administrative expenses		10,236			11,556			33,423			33,661
Depreciation and amortization		14,492			13,533			42,444			39,049
(Gain) loss on sale and involuntary disposal of assets		(5,201	)		4			(5,095	)		(5,497	)
Impairment charge		-			-			97,665			46,247
Total costs and expenses		68,498			70,999			316,258			243,860
Operating income (loss)		25,981			19,765			(44,346	)		60,355
Other income (expense):
Interest expense		(5,807	)		(5,146	)		(15,858	)		(15,229	)
Interest income		597			128			739			264
Foreign currency gain (loss) and other		(603	)		532			158			(884	)
Total other expense		(5,813	)		(4,486	)		(14,961	)		(15,849	)
Income (loss) before income taxes		20,168			15,279			(59,307	)		44,506
Income tax (provision) benefit		(961	)		(2,577	)		9,326			17,340
Net income (loss)	$	19,207		$	12,702		$	(49,981	)	$	61,846
Earnings (loss) per share:
Basic	$	0.75		$	0.50		$	(1.96	)	$	2.46
Diluted	$	0.75		$	0.50		$	(1.96	)	$	2.44
Weighted average shares outstanding:
Basic		25,599			25,235			25,512			25,116
Diluted		25,737			25,485			25,512			25,343

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GULFMARK OFFSHORE, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

For the Nine Months Ended September 30, 2010

									Accumulated									Deferred
			Additional						Other									Compen-		Total
	Common		Paid-In			Retained			Comprehensive									sation		Stockholders’
	Stock		Capital			Earnings			Income/(Loss)			Treasury Stock						Expense		Equity
															Share
												Shares			Value
	(In thousands)
Balance at December 31, 2009	$	255	$	362,022		$	571,213		$	54,005			(209	)	$	(5,865	)	$	5,838	$	987,468
Net loss							(49,981	)													(49,981	)
Issuance of common stock		2		6,051																	6,053
Exercise of stock options		1		1,068																	1,069
Deferred compensation plan				(1,208	)								(47	)		(1,337	)		1,013		(1,532	)
Unrealized loss on cash flow hedges										(1,347	)										(1,347	)
Translation adjustment										(14,147	)										(14,147	)
Balance at September 30, 2010	$	258	$	367,933		$	521,232		$	38,511			(256	)	$	(7,202	)	$	6,851	$	927,583

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GULFMARK OFFSHORE, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine Months Ended
	September 30,
	2010			2009
	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	(49,981	)	$	61,846
Adjustments to reconcile net income (loss) from operations to net cash provided by operating activities:
Depreciation and amortization		42,444			39,049
Gain on sale of assets		(5,095	)		(5,497	)
Impairment charge		97,665			46,247
Amortization of stock based compensation		4,275			5,873
Amortization of deferred financing costs on debt		1,199			528
Provision for doubtful accounts receivable, net of write-offs		174			542
Deferred income tax benefit		(4,363	)		(22,245	)
Foreign currency transaction (gain) loss		(151	)		1,361
Change in operating assets and liabilities:
Accounts receivable		(7,799	)		20,230
Prepaids and other		(2,765	)		(5,760	)
Accounts payable		882			3,110
Accrued liabilities and other		(19,125	)		(6,612	)
Net cash provided by operating activities		57,360			138,672
Cash flows from investing activities:
Purchases of vessels and equipment		(65,452	)		(40,411	)
Proceeds from disposition of vessels and equipment		19,582			8,893
Net cash used in investing activities		(45,870	)		(31,518	)
Cash flows from financing activities:
Proceeds from debt		51,000			-
Repayments of debt		(66,000	)		(18,477	)
Debt refinancing cost		(2,000	)		-
Proceeds from exercise of stock options		1,069			694
Proceeds from issuance of stock		537			588
Net cash used in financing activities		(15,394	)		(17,195	)
Effect of exchange rate changes on cash		(234	)		7,383
Net increase (decrease) in cash and cash equivalents		(4,138	)		97,342
Cash and cash equivalents at beginning of the period		92,079			100,761
Cash and cash equivalents at end of the period	$	87,941		$	198,103
Supplemental cash flow information:
Interest paid, net of interest capitalized	$	15,909		$	18,032
Income taxes paid, net	$	4,001		$	2,595

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GULFMARK OFFSHORE, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS

(1) GENERAL INFORMATION

     The condensed consolidated financial statements of GulfMark Offshore, Inc. and its subsidiaries included herein have been prepared by us without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC. Unless otherwise indicated, references to “we,” “us,” “our” and the “Company” refer collectively to GulfMark Offshore, Inc., its subsidiaries and its predecessors. Certain information relating to our organization and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, has been condensed or omitted in this Form 10-Q pursuant to such rules and regulations. However, we believe that the disclosures herein are adequate to make the information presented not misleading. The consolidated balance sheet as of December 31, 2009, has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. It is recommended that these financial statements be read in conjunction with our consolidated financial statements and notes thereto included in our Form 10-K for the year ended December 31, 2009.

     In the opinion of management, all adjustments, which include reclassification and normal recurring adjustments necessary to present fairly the condensed consolidated financial statements for the periods indicated have been made. All significant intercompany accounts have been eliminated. Certain reclassifications of previously reported information may be made to conform with current year presentation.

     We provide offshore marine support and transportation services primarily to companies involved in the offshore exploration and production of oil and natural gas. Our vessels transport materials, supplies and personnel to offshore facilities, as well as move and position drilling structures. The majority of our operations are conducted in the North Sea, offshore Southeast Asia and the Americas. We also contract vessels into other regions to meet our customers’ requirements.

     Basic Earnings Per Share, or EPS, is computed by dividing net income (loss) by the weighted average number of shares of Class A Common Stock outstanding during the period. Diluted EPS is computed using the treasury stock method for Class A Common Stock equivalents. The details of our EPS calculation are as follows (in thousands, except per share amounts):

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	Three Months Ended								Three Months Ended
	September 30, 2010								September 30, 2009
						Per Share							Per Share
	Income			Shares		Amount			Income		Shares		Amount
Earnings per share, basic	$	19,207			25,599	$	0.75		$	12,702		25,235	$	0.50
Dilutive effect of common stock options and unvested restricted stock		-			138		-			-		250		-
Earnings per share, diluted	$	19,207			25,737	$	0.75		$	12,702		25,485	$	0.50
	Nine Months Ended								Nine Months Ended
	September 30, 2010								September 30, 2009
						Per Share							Per Share
	Income			Shares		Amount			Income		Shares		Amount
Earnings (loss)per share, basic	$	(49,981	)		25,512	$	(1.96	)	$	61,846		25,116	$	2.46
Dilutive effect of common stock options and unvested restricted stock		-			-		-			-		227		(0.02	)
Earnings (loss) per share, diluted	$	(49,981	)		25,512	$	(1.96	)	$	61,846		25,343	$	2.44

(2) COMPREHENSIVE INCOME

     The components of comprehensive income (loss), net of related tax, are as follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2010			2009			2010			2009
	(In thousands)						(In thousands)
Net income (loss)	$	19,207		$	12,702		$	(49,981	)	$	61,846
Comprehensive income:
Unrealized gain (loss) on cash flow hedge		(329	)		(158	)		(1,347	)		1,848
Foreign currency translation		35,147			10,523			(14,147	)		64,434
Total comprehensive income (loss)	$	54,025		$	23,067		$	(65,475	)	$	128,128

     Our accumulated other comprehensive income (loss) item relates primarily to our cumulative foreign currency translation adjustments, and adjustments related to the cash flow hedge.

(3) IMPAIRMENT CHARGE

Goodwill

     At September 30, 2010, our goodwill consists of $31.7 million related to acquisitions in the North Sea region. The determination of impairment of all long-lived assets, goodwill, and intangibles is conducted when indicators of impairment are present and at least annually for goodwill. Impairment testing for goodwill is performed on a reporting segment basis.

     In the second quarter of 2010, we assessed our Americas region goodwill, which totaled $97.7 million prior to June 30, 2010, for impairment. In our assessment, we evaluated the impact

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on the segment’s fair value due to the recent events in the U.S. Gulf of Mexico relating to the April 20, 2010 explosion and fire on a deepwater drilling rig, the resulting oil spill and the U.S. Department of Interior moratorium on deepwater drilling. This moratorium was lifted on October 12, 2010, subject to new standards, requirements and regulations for offshore drilling. The ramifications of the events in the Gulf of Mexico were not considered in our first quarter analysis and disclosure, but were considered to have a material effect in our second quarter analysis.

     Based on the factors discussed above, which were incorporated into our evaluations and testing as prescribed under U.S. GAAP, we determined that an impairment of our Americas region goodwill existed, and accordingly we recorded a $97.7 million impairment charge as of June 30, 2010, reflecting all of our Americas region goodwill. The non-cash charge does not impact our liquidity or debt covenant compliance.

Vessels Under Construction

     In March 2009, we notified a shipyard building three of the vessels in our new build program that they were in default under the construction contract. The default arose as a result of non-performance under the terms of the contract caused by financial difficulties of the shipyard. Construction on these vessels was stopped. We determined that we had a material impairment and recognized a pre-tax charge of $46.2 million in the first quarter of 2009 pertaining to the construction in progress related to this contract. That charge represented the full amount of our investment in these vessels. The shipyard building the three vessels is in Chapter 11 bankruptcy proceedings. We are pursuing our claims and remedies in the bankruptcy proceedings.

(4) FLEET EXPANSION AND RENEWAL PROGRAM

     During 2010, we have taken delivery of three vessels that were under construction at December 31, 2009. As of October 27, 2010, we have one vessel that is being held for sale that is not included in our fleet numbers and have no vessels under construction. In the second quarter of 2010, we sold one of our Americas vessels and recorded a $0.1 million loss. At the end of the third quarter of 2010, we sold one of our North Sea vessels and recorded a $5.2 million gain. The following table illustrates the details of the vessels added and disposed of since December 31, 2009.

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			Year		Length						Month
Vessel	Region	Type (1)	Built		(feet)		BHP (2)		DWT (3)		Delivered/Disposed
Vessel Additions Since December 31, 2009
North Purpose	N. Sea	PSV		2010		284		10,600		4,850	Feb-10
Sea Valiant	SEA	AHTS		2010		230		10,000		2,150	Jun-10
Sea Victor	SEA	AHTS		2010		230		10,000		2,150	Jul-10
Vessel Disposals Since December 31, 2009
Seapower	Americas	SpV		1974		222		7,040		1,205	May-10
North Traveller	N. Sea	LgPSV		1998		221		5,450		3,115	Sep-10

1)	AHTS - Anchor handling, towing and supply vessel
	FSV - Fast supply vessel
	PSV - Platform supply vessel
	Lg PSV - Large platform supply vessel
	SpV - Specialty vessel, including towing and oil response
	SmAHTS - Small anchor handling, towing and supply vessel
2)	BHP - Breakhorse power
3)	DWT - Deadweight tons

     Interest is capitalized in connection with the construction of vessels. During the three-month periods ended September 30, 2010 and 2009, $0.1 million and $0.7 million of interest, respectively, was capitalized. During the nine month periods ended September 30, 2010 and 2009, $1.4 million and $3.1 million, respectively, was capitalized.

(5) INCOME TAXES

     We consider earnings of certain foreign subsidiaries to be permanently reinvested, and as such, we have not provided for any U.S. federal or state income taxes on those earnings. Also, many of our foreign subsidiaries are subject to foreign tax systems that provide significant tax incentives to qualified shipping activities. These incentives result in statutory tax rates in those foreign jurisdictions that are very low. Because of the significant difference in statutory rates among the various taxing jurisdictions in which we operate, relatively small changes in pre-tax profitability among those various jurisdictions can cause considerable variability in the overall effective tax rate.

     As previously disclosed, in February 2010 the Norwegian Supreme Court ruled unconstitutional the 2007 legislation to begin taxing previously untaxed pre-2007 tonnage tax profits. This decision was a change in tax law and, accordingly, we recorded a $15.0 million tax benefit, including a cash refund of approximately $3.0 million, in our tax provision for the quarter ended March 31, 2010 to reflect the elimination of this previously recorded income tax liability. As part of Norway’s revised 2010 budget process, on June 25, 2010, new tax legislation regarding pre-2007 tonnage tax profits was signed into law. Accordingly, in the second quarter of 2010 we recorded a $4.9 million tax expense.

     Our income tax provision for the first nine months of 2010 was a benefit of $9.3 million, which includes the two special items noted above, and for the quarter ended September 30, 2010 was an expense of $1.0 million. Before the two special items, our tax provision for the first nine months of 2010 was an expense of $0.8 million. There were no special items in our tax provision for the third quarter of 2010. Our low effective income tax rate for 2010 is the result of lower profitability in the higher tax rate jurisdictions in which we operate.

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(6) COMMITMENTS & CONTINGENCIES

     We have contingent liabilities and future claims for which we have made estimates of the amount of the eventual cost to liquidate such liabilities or claims. These may involve threatened or actual litigation where damages have not been specifically quantified, but we have made an assessment of our exposure and recorded a provision in our accounts for the expected loss. Other claims or liabilities, including those related to taxes in foreign jurisdictions or the industry-wide, multi-employer, defined benefit pension fund, Merchant Officers Pension Fund in the U.K., may be estimated based on our experience or estimated liabilities in these matters and, where appropriate, the advice of outside counsel or other outside experts. Upon the ultimate resolution of the uncertainties surrounding our estimates of contingent liabilities and future claims, our future reported financial results would be impacted by the difference between our estimates and the actual amounts paid to settle them. Our contingent liabilities are based on the most recent information available to us regarding the nature of the exposure. In the recent past, our estimates for contingent liabilities have been sufficient to cover the actual amount of our exposure.

(7) DERIVATIVE FINANCIAL INSTRUMENTS

     Derivative instruments are accounted for at fair value. The accounting for changes in the fair value of a derivative depends on the intended use and designation of the derivative instrument. For a derivative instrument designated as a fair value hedge, the gain or loss on the derivative is recognized in earnings in the period of change in fair value together with the offsetting gain or loss on the hedged item. For a derivative instrument designated as a cash flow hedge, the effective portion of the derivative’s gain or loss is initially reported as a component of Other Comprehensive Income (“OCI”) and is subsequently recognized in earnings when the hedged exposure affects earnings. The ineffective portion of the gain or loss is recognized in earnings. Gains and losses from changes in fair values of derivatives that are not designated as hedges for accounting purposes are recognized in earnings.

     Using derivative instruments means assuming counterparty credit risk. Counterparty credit risk relates to the loss we could incur if a counterparty were to default on a derivative contract. We deal with investment grade counterparties and monitor the overall credit risk and exposure to individual counterparties. We do not anticipate nonperformance by any counterparties. The amount of counterparty credit exposure is the unrealized gains, if any, on such derivative contracts. We do not require, nor do we post, collateral or security on such contracts.

Hedging Strategy

     We are exposed to certain risks relating to our ongoing business operations. As a result, we enter into derivative transactions to manage certain of these exposures that arise in the normal course of business. The primary risks managed by using derivative instruments are foreign currency exchange rate and interest rate risks. Fluctuations in these rates and prices can affect our operating results and financial condition. We manage the exposure to these market risks through operating and financing activities and through the use of derivative financial instruments. We do not enter into derivative financial instruments for trading or speculative purposes.

     We have periodically entered into forward foreign currency contracts that are designated as fair value hedges and are highly effective, as the terms of the forward contracts are the same as the purchase commitments under the related contract. Any gains or losses resulting from

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changes in fair value are recognized in earnings with an offsetting adjustment to income for changes in the fair value of the hedged item such that there was no net impact in the consolidated statements of operations. As of September 30, 2010, we have no open contracts.

     We entered into an interest rate swap with the objective of reducing our exposure to interest rate risk for $100.0 million of our $200.0 million Facility Agreement variable-rate debt. At September 30, 2010, our interest rate derivative instruments have an outstanding notional amount of $100.0 million and have been designated as cash flow hedges. The critical terms of this swap, including reset dates and floating rate indices, match those of our underlying variable-rate debt and no ineffectiveness has been recorded.

Early Hedge Settlement

     During December 2009, we cash settled certain interest rate swaps prior to their scheduled settlement dates. As a result of these transactions, we paid $6.4 million in cash, which represented the fair value of these swaps at the date of settlement. Unrecognized losses of $2.3 million are recorded as of September 30, 2010 in accumulated OCI related to these interest rate swaps. This balance will be amortized into interest expense through December 31, 2012 based on forecasted payments as of the settlement date.

     The following table quantifies the fair values, on a gross basis, of all our derivative contracts and identifies the balance sheet location as of September 30, 2010 and December 31, 2009 (dollars in thousands):

	Asset Derivatives						Liability Derivatives
	September 30, 2010			December 31, 2009			September 30, 2010			December 31, 2009
Derivatives designed as hedging	Balance Sheet			Balance Sheet			Balance Sheet			Balance Sheet
instruments	Location	Fair Value		Location	Fair Value		Location	Fair Value		Location	Fair Value
Foreign exchange contract	Fair Value Hedges	$	-	Fair Value Hedges	$	6,886	Fair Value Hedges	$	-	Fair Value Hedges	$	6,886
Interest rate swaps			-			-	Cash flow hedges		7,942	Cash flow hedges		6,422
		$	-		$	6,886		$	7,942		$	13,308

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     The following tables quantify the amount of gain or loss recognized during the three and nine months ended September 30, and identify the consolidated statements of operations location:

	Location of Gain or Loss	Amount of Gain or Loss
Derivatives in fair value	Recognized in Income on	Recognized in Income on
hedging relationships	Derivative	Derivative
		2010		2009
		(in thousands)
Foreign exchange contracts	See note.	$	-	$	-

							Location of Gain or (Loss)	Amount of Gain or (Loss)
	Amount of Gain or (Loss)						Reclassified from	Reclassified from
Derivatives in cash flow	Recognized in OCI on						Accumulated OCI into	Accumulated OCI into
hedging relationships	Derivative						Income	Income
	Three Months Ended September 30,							Three Months Ended September 30,
	2010			2009				2010			2009
	(in thousands)							(in thousands)
Interest rate swaps	$	(1,299	)	$	(158	)	Interest expense	$	(652	)	$	(1,013	)
	Nine Months Ended September 30,							Nine Months Ended September 30,
	2010			2009				2010			2009
	(in thousands)							(in thousands)
Interest rate swaps	$	(4,501	)	$	1,848		Interest expense	$	(1,969	)	$	(3,043	)

(8) FAIR VALUE MEASUREMENTS

     Each asset and liability required to be carried at fair value is classified under one of the following criteria:

Level 1: Quoted market prices in active markets for identical assets or liabilities
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data
Level 3: Unobservable inputs that are not corroborated by market data

Financial Instruments

     At December 31, 2009, we maintained fair value hedges associated with firm contractual commitments for future vessel payments denominated in a foreign currency. These forward contracts were designated as fair value hedges and were highly effective, as the terms of the forward contracts were the same as the purchase commitment under the new build contract. We recognized the fair value of our derivative assets as a Level 2 valuation. We determined the fair value of our financial instrument position based on the forward contract price and the foreign currency exchange rate as of December 31, 2009. We took delivery of the new build vessel associated with the contracts in the first quarter of 2010 and settled the contracts. At September 30, 2010, we did not have any open fair value hedges.

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     On December 17, 2009, we entered into a $200.0 million facility agreement. Concurrently, we entered into an interest rate swap related to approximately $100.0 million of the Facility Agreement indebtedness that has fixed the interest rate at 4.145%. The interest rate swap is accounted for as cash flow hedge. We report changes in the fair value of the cash flow hedge in accumulated OCI. The consolidated balance sheet contains the cash flow hedge within other long-term liabilities, reflecting the fair value of the interest rate swap which was $7.9 million at September 30, 2010. We expect to reclassify $3.3 million of deferred loss on the current interest rate swap to interest expense during the next 12 months. We recognize the fair value of our derivative swaps as a Level 2 valuation. We determined the fair value of our interest rate swap based on the contractual fixed rate in the swap agreement and the forward curve of three month LIBOR supplied by the bank as of September 30, 2010.

     The following table presents information about our assets (liabilities) measured at fair value on a recurring basis as of September 30, 2010, and indicates the fair value hierarchy we utilized to determine such fair value (in millions).

	Level 1		Level 2			Level 3		Total
Cash Flow Hedges	$	-	$	(7.9	)	$	-	$	(7.9	)

(9) OPERATING SEGMENT INFORMATION

     We operate three segments: the North Sea, Southeast Asia and the Americas, each of which is considered a reportable segment under FASB ASC 280, Segment Reporting. Our management evaluates segment performance primarily based on operating income. Cash and debt are managed centrally. Because the regions do not manage those items, the gains and losses on foreign currency remeasurements associated with these items are excluded from operating income. Our management considers segment operating income to be a good indicator of each segment’s operating performance from its continuing operations, as it represents the results of the ownership interest in operations without regard to financing methods or capital structures. Each operating segment’s operating income (loss) is summarized in the following table and detailed discussions below.

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Operating Income (Loss) by Operating Segment

				Southeast
	North Sea			Asia			Americas			Other			Total
							(In thousands)
Quarter Ended September 30, 2010
Revenue	$	38,340		$	17,867		$	38,272		$	-		$	94,479
Direct operating expenses		19,105			3,204			19,420			-			41,729
Drydock expense		3,614			488			3,140			-			7,242
General and administrative expenses		2,485			633			1,533			5,585			10,236
Depreciation and amortization expense		4,704			2,463			7,016			309			14,492
(Gain) loss on sale of assets		(5,246	)		-			45			-			(5,201	)
Operating income (loss)	$	13,678		$	11,079		$	7,118		$	(5,894	)	$	25,981
Quarter Ended September 30, 2009
Revenue	$	40,722		$	19,114		$	30,928		$	-		$	90,764
Direct operating expenses		19,150			2,469			17,889			-			39,508
Drydock expense		2,833			1,040			2,525			-			6,398
General and administrative expenses		2,822			520			2,296			5,918			11,556
Depreciation and amortization expense		4,336			1,879			7,097			221			13,533
(Gain) loss on sale of assets		3			-			1			-			4
Operating income (loss)	$	11,578		$	13,206		$	1,120		$	(6,139	)	$	19,765
				Southeast
	North Sea			Asia			Americas			Other			Total
							(In thousands)
Nine Months Ended September 30, 2010
Revenue	$	110,832		$	50,535		$	110,545		$	-		$	271,912
Direct operating expenses		58,570			7,914			60,972			-			127,456
Drydock expense		7,133			4,071			9,161			-			20,365
General and administrative expenses		8,006			1,995			6,080			17,342			33,423
Depreciation and amortization expense		13,988			6,464			21,228			764			42,444
(Gain) loss on sale of assets		(5,246	)		-			154			(3	)		(5,095	)
Impairment charge		-			-			97,665			-			97,665
Operating income (loss)	$	28,381		$	30,091		$	(84,715	)	$	(18,103	)	$	(44,346	)
Nine Months Ended September 30, 2009
Revenue	$	130,957		$	56,300		$	116,958		$	-		$	304,215
Direct operating expenses		55,985			6,535			56,602			-			119,122
Drydock expense		5,150			2,089			4,039			-			11,278
General and administrative expenses		7,777			1,931			6,599			17,354			33,661
Depreciation and amortization expense		12,557			5,141			20,745			606			39,049
(Gain) loss on sale of assets		(4,055	)		(1,438	)		(4	)		-			(5,497	)
Impairment charge		-			-			46,247			-			46,247
Operating income (loss)	$	53,543		$	42,042		$	(17,270	)	$	(17,960	)	$	60,355

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     We provide offshore marine support and transportation services primarily to companies involved in the offshore exploration and production of oil and natural gas. Our vessels transport drilling materials, supplies and personnel to offshore facilities, as well as move and position drilling structures. The North Sea, offshore Southeast Asia, offshore West Africa, offshore Middle East, offshore Brazil and the Gulf of Mexico are each major markets that employ a large number of vessels. Vessel usage is also significant in other international markets, including offshore India, offshore Australia, offshore Trinidad, the Persian Gulf and the Mediterranean Sea. The industry is relatively fragmented, with more than 20 major participants and numerous small regional competitors. We currently operate a fleet of 89 offshore support vessels in the following regions: 38 vessels in the North Sea, 15 vessels offshore Southeast Asia and 36 vessels in the Americas. We have one vessel held for sale, which is not included in our fleet numbers. Our owned fleet is one of the world’s youngest, largest and most geographically balanced, high specification offshore support vessel fleets and our owned vessels (excluding specialty vessels) have an average age of approximately seven years.

     Our results of operations are directly impacted by the level of activity in worldwide offshore oil and natural gas exploration, development and production. This activity is in turn influenced by trends in oil and natural gas prices. Oil and natural gas prices are affected by a host of geopolitical, regulatory and economic forces, including the fundamental principles of supply and demand. Over the last few years commodity prices were at record highs, resulting in oil and natural gas companies increasing exploration and development activities. However, as a result of the world economic crisis, commodity prices declined and we experienced a reduction in the level of activity. Although oil prices have recovered, natural gas prices remain lower and continue to affect our activity levels.

     On April 20, 2010, an explosion and fire on a deepwater U.S. Gulf of Mexico drilling rig occurred that resulted in a U.S. Department of Interior moratorium on deepwater drilling on the outer continental shelf. This moratorium was lifted on October 12, 2010, subject to new standards, requirements and regulations for offshore drilling. The ramifications of these events had a material impact on our outlook for the U.S. Gulf of Mexico operations and was a key factor in the determination of our second quarter 2010 goodwill impairment.

     The operations of our fleet may be subject to seasonal factors. Operations in the North Sea are often at their highest levels from April to August, and at their lowest levels from November to February. Operations in our other areas, although involving some seasonal factors, tend to remain more consistent throughout the year. We have historically, to the extent possible, accomplished the majority of our drydocks, which are maintenance and repairs designed to ensure compliance with applicable regulations and maintaining certifications for our vessels with various international classification societies, during these seasonal decreases in demand in order to minimize downtime during our traditionally peak demand periods. When a vessel is drydocked, we incur not only the drydocking cost but also the loss of revenue from the vessel during the drydock period. The demands of the market, the expiration of existing contracts, the start of new contracts and the availability allowed by our customers influence the timing of drydocks throughout the year. During the first nine months of 2010, we completed 525 drydock days, compared to 377 drydock days completed in the same period last year.

     We provide management services to other vessel owners for a fee, which is included in revenue. Charter revenues and vessel expenses of these managed vessels are not included in our

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operating results. These vessels are excluded for purposes of calculating fleet rates per day worked and utilization in the applicable periods.

     Our operating costs are primarily a function of fleet configuration. The most significant direct operating costs are wages paid to vessel crews, maintenance and repairs, and marine insurance. Generally, fluctuations in vessel utilization have little effect on direct operating costs in the short term. As a result, direct operating costs as a percentage of revenues may vary substantially due to changes in day rates and utilization.

     In addition to direct operating costs, we incur fixed charges related to the depreciation of our fleet and costs for routine drydock inspections.

Critical Accounting Policies

     There have been no changes to the critical accounting policies used in our reporting of results of operations and financial position. For a discussion of our critical accounting policies see Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K for the year ended December 31, 2009.

Goodwill

     At September 30, 2010, our goodwill consists of $31.7 million related to acquisitions in the North Sea region. The determination of impairment of all long-lived assets, goodwill, and intangibles is conducted when indicators of impairment are present and at least annually for goodwill. Impairment testing for goodwill is performed on a reporting segment basis.

     In the second quarter of 2010, we assessed our Americas region goodwill for impairment. In our assessment, we evaluated the impact on the segment’s fair value due to the recent events in the U.S. Gulf of Mexico relating to the April 20, 2010 explosion and fire on a deepwater drilling rig, the resulting oil spill and the U.S. Department of Interior moratorium on deepwater drilling. This moratorium was lifted on October 12, 2010, subject to new standards, requirements and regulations for offshore drilling. The ramifications of the events in the Gulf of Mexico were not considered in our first quarter analysis and disclosure, but were considered to have a material effect in our second quarter analysis.

     Based on the factors discussed above, which were incorporated into our evaluations and testing as prescribed under U.S. GAAP, we determined that an impairment of our Americas region goodwill existed, and accordingly we recorded a $97.7 million impairment charge as of June 30, 2010, reflecting all of our Americas region goodwill. The non-cash charge does not impact our liquidity or debt covenant compliance.

Results of Operations

     The table below sets forth, by region, the average day rates and utilization for our vessels and the average number of vessels owned or chartered during the periods indicated. This fleet generates substantially all of our revenues and operating profit. We use the information that follows to evaluate the performance of our business.

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	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2010			2009			2010			2009
Revenues by Region (000’s) (a):
North Sea Based Fleet (c)	$	38,340		$	40,722		$	110,832		$	130,957
Southeast Asia Based Fleet		17,867			19,114			50,535			56,300
Americas Based Fleet		38,272			30,928			110,545			116,958
Rates Per Day Worked (a) (b):
North Sea Based Fleet (c)	$	17,637		$	20,171		$	16,965		$	20,820
Southeast Asia Based Fleet		16,841			21,180			17,190			21,033
Americas Based Fleet		15,830			16,894			14,165			16,605
Overall Utilization (a) (b):
North Sea Based Fleet		91.6	%		90.5	%		93.5	%		89.3	%
Southeast Asia Based Fleet		85.2	%		85.8	%		87.0	%		88.9	%
Americas Based Fleet		76.0	%		57.3	%		82.5	%		76.2	%
Average Owned/Chartered Vessels (a) (d):
North Sea Based Fleet (c)		25.7			24.0			25.1			25.0
Southeast Asia Based Fleet		13.9			11.7			12.7			11.3
Americas Based Fleet		35.0			35.8			35.4			34.6
Total		74.6			71.5			73.2			70.9

(a)	Includes all owned or bareboat chartered vessels.
(b)	Rate per day worked is defined as total charter revenues divided by number of days worked. Utilization rate is defined as the total days worked divided by total days of availability in the period.
(c)	Revenues for vessels in the North Sea based fleet are primarily earned in Pound Sterling (GBP), Norwegian Kroner (NOK) and Euros, and have been converted to U.S. Dollars (US$) at the average exchange rate for the period. The average equivalent exchange rate per one US$ for the periods indicated is as shown in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Currency Fluctuations and Inflation” on page 22.
(d)	Average number of vessels is calculated based on the aggregate number of vessel days available during each period divided by the number of calendar days in such period. Includes owned and bareboat vessels only, and is adjusted for vessel additions and dispositions occurring during each period.

Comparison of the Three Months Ended September 30, 2010 with the Three Months Ended September 30, 2009

     For the quarter ended September 30, 2010, we had net income of $19.2 million, or $0.75 per diluted share, on revenues of $94.5 million. For the same period in 2009, net income was $12.7 million, or $0.50 per diluted share on revenues of $90.8 million.

     Our revenues for the quarter ended September 30, 2010, increased $3.7 million, or 4.1%, compared to the third quarter of 2009. The increase in revenue was due mainly to higher capacity and utilization offset by lower day rates. Revenue increased by $2.5 million as overall capacity increased primarily as a result of the addition of two new builds in the North Sea and the full quarter effect associated with the addition of a new build in Southeast Asia in 2009. In addition, overall utilization increased from 73.1% in the third quarter of 2009 to 83.1% in the current year

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quarter positively affecting revenue by $6.2 million. These increases were offset by the combination of the currency effect and the decrease in overall day rates from $19,077 in the third quarter of 2009 to $16,710 in the current year quarter, which decreased revenue by $5.0 million.

     Operating income increased by $6.2 million compared to the third quarter of 2009 due primarily to the increase in revenue and the gain on sale of a vessel, offset by the increase in direct operating costs due to the new vessel additions, and higher drydock expenses incurred on four Gulf of Mexico vessels prior to relocating to Brazil.

North Sea

     Revenues in the North Sea region decreased by $2.4 million, or 5.8%, to $38.3 million in the third quarter of 2010. The combination of the strengthening of the U.S. Dollar and the decrease in day rates from $20,171 in the third quarter of 2009 to $17,637 in the current year quarter, contributed $4.4 million to the decrease in revenue. Although utilization increased from 90.5% in the 2009 third quarter to 91.6% in the current year quarter, the overall mix of lower day rates and utilization effect resulted in a decrease in revenue of $0.6 million. This was offset by increased capacity from the addition of two new build vessels in late 2009 and early 2010, contributing $2.6 million to revenue compared to the prior year quarter. Operating income increased $2.1 million from the prior year quarter due mainly to a $5.2 million gain on sale of a vessel at the end of the third quarter, current year offset by higher drydock expense of $0.8 million.

Southeast Asia

     Revenues for our Southeast Asia based fleet decreased by $1.2 million to $17.9 million in the third quarter of 2010. The combination of currency effects and the decrease in day rates from $21,180 in the third quarter of 2009 to $16,841 in the current year quarter contributed $3.8 million to the decrease in revenue. Utilization decreased slightly from 85.8% in the third quarter of 2009 to 85.2% in the current year quarter due mainly to the new vessel additions that are currently idle; however, revenue increased by $1.6 million as a result of the overall positive mix of day rates and utilization. The increased capacity associated with the full quarter effect of the addition of a new build vessel during the third quarter of 2009 also increased revenue by $1.0 million. Operating income was $11.1 million in the third quarter of 2010 compared to $13.2 million in the same 2009 quarter. The decrease is due mainly to the decrease in revenue; in addition, operating costs increased by $0.7 million and depreciation increased $0.6 million, primarily as a result of two new build vessels added in 2010. Drydock costs decreased $0.6 million due to fewer drydock days.

Americas

     The Americas region revenues increased by $7.3 million, or 23.7%, to $38.3 million in the third quarter of 2010. Utilization increased from 57.3% in the third quarter of 2009 to 76.0% in the current year quarter; however, day rates decreased from $16,894 in the third quarter of 2009 to $15,830 in the current year quarter. The mix of higher utilization with higher day rate vessels increased revenue by $8.3 million. This was offset somewhat by the sale of a vessel earlier in 2009, which decreased capacity by $1.0 million. Operating income was $7.1 million in the third quarter of 2010 compared to $1.1 million in the third quarter of 2009, an increase of $6.0 million. The increase is due mainly to the increase in revenue offset by increased operating and drydock expenses incurred on four Gulf of Mexico vessels prior to relocating to Brazil.

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Other

     Other expenses in the third quarter of 2010 increased by $1.3 million compared to the prior year quarter resulting primarily from the increase in foreign currency losses and an increase in interest expense due to lower capitalized interest.

Tax Provision

     Our tax provision for the third quarter of 2010 was $1.0 million, compared to $2.6 million in the third quarter of 2009. The decrease resulted primarily from a lower effective tax rate in the third quarter of 2010 based on the domestic tax impact of lower dividends recognized from our foreign subsidiaries and reduced profits from our operations in higher tax jurisdictions.

Comparison of the Nine Months Ended September 30, 2010 with the Nine Months Ended September 30, 2009

     For the nine months ended September 30, 2010, we had a net loss of $50.0 million, or $1.96 per diluted share, on revenues of $271.9 million. During the same period in 2009, net income was $61.8 million, or $2.44 per diluted share, on revenues of $304.2 million. The 2010 net loss included a $97.7 million goodwill impairment charge and the 2009 income was impacted by a $46.2 million impairment charge related to a non-performance default on a construction contract.

     Year-to-date revenues decreased 10.6% or $32.3 million year over year. Day rates decreased from $18,961 in the nine months ended September 30, 2009, to $15,719 in the same period of 2010. The combination of day rates and currency exchange rates resulted in a $46.2 million decrease in revenue. Revenue was positively affected by the addition of one new build vessel delivered in 2010 and the full nine month effect of six new build vessels delivered during 2009. Two additional new vessels were added to the fleet in 2010, but have not yet been chartered. The new build additions were offset by the sale of one vessel in the second quarter of 2010 and one in the third quarter of 2010. These capacity changes resulted in a net increase in revenue of $12.8 million. Revenue also benefited $1.1 million as utilization increased from 82.9% in the nine month period of 2009 to 87.0% in the same period of 2010.

     Operating income, excluding the impairment charges of $97.7 million in 2010 and $46.2 million in 2009, was $53.3 million in 2010 and $106.6 million in 2009. The decrease is primarily related to the decrease in revenue coupled with increased direct operating cost, drydock and depreciation expense resulting primarily from the new vessel additions.

North Sea

     North Sea revenue decreased $20.1 million in 2010 compared to 2009. The effect of the strengthening of the U.S. Dollar and the decrease in day rates from $20,820 in 2009 to $16,965 in 2010 contributed $24.2 million to the decrease in revenue. Capacity increased revenue by $4.7 million due primarily to the addition of two new build vessels in the first quarter of 2010. Overall utilization increased from 89.3% in 2009 to 93.5% in the current year, but revenue decreased $0.6 million as the utilization mix of vessels and with lower day rates was negative. Operating income decreased by $25.2 million compared to 2009, resulting primarily from the decrease in revenue coupled with the increase in operating, drydock and depreciation expenses from the new vessel additions.

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Southeast Asia

     Revenue for our Southeast Asia based fleet decreased by $5.8 million in the first nine months of 2010 compared to the same 2009 period. Day rates decreased from $21,033 in 2009 to $17,190 in 2010, which negatively impacted revenue by $11.2 million. Capacity had a positive impact of $7.3 million on revenue as a result of the full period effect of two new build vessels added in 2009. In addition, two new build vessels were added to the fleet in mid-2010, but have not yet been chartered. Overall utilization decreased from 88.9% to 87.0%, representing $1.9 million in lower revenue. Operating income decreased from $42.0 million in 2009 to $30.1 million in 2010 due to the decrease in revenues and an increase in operating cost resulting from the new vessel additions, and higher drydock expenses.

Americas

     Our Americas region revenue decreased $6.4 million, from $117.0 million in 2009 to $110.5 million in 2010. Day rates decreased from $16,605 in 2009 to $14,165 in 2010, which negatively impacted revenue by $10.8 million. Capacity had a positive impact of $0.8 million on revenue as a result of the full period effect of three new build vessels added in 2009, offset by the sale of a vessel in 2010. Overall utilization increased from 76.2% to 82.5%, resulting in $3.6 million of higher revenue. Excluding the impairment charges in both years, operating income decreased $16.0 million from 2009 resulting from lower revenues and higher operating and drydock expenses. We experienced 84 more drydock days in the first nine months of 2010 than in the same period of 2009, due in part to the work performed on four Gulf of Mexico vessels prior to relocating to Brazil.

Other

     In the nine months ended September 30, 2010, other expense totaled $15.0 million, a decrease of $0.9 million from 2009. The decrease was due primarily to a net gain in foreign currency.

Tax Provision

     Our tax provision for the nine months ended September 30, 2010, was a benefit of $9.3 million compared to a benefit of $17.3 million in the same period in 2009. The difference is principally due to the lower amounts of previously mentioned special or discrete tax items in 2010 compared to 2009. The remainder of the difference relates primarily to the domestic tax impact of lower dividends in 2010 from our foreign subsidiaries.

Liquidity, Capital Resources and Financial Condition

     Our ongoing liquidity requirements are generally associated with our need to service debt, fund working capital, acquire or improve equipment and make other investments. Since inception, we have been active in the acquisition of additional vessels through both the resale market and new construction. Bank financing, equity capital and internally generated funds have historically provided funding for these activities. Internally generated funds are directly related to fleet activity and vessel day rates, which are generally dependent on the demand for our vessels which is ultimately determined by the supply and demand of crude oil and natural gas.

     Net working capital at September 30, 2010, was $98.3 million. Cash on hand at September 30, 2010, totaled $87.9 million. Net cash provided by operating activities was $18.0

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million for the three months ended September 30, 2010, cash provided by investing activities for the same three months was $16.4 million, and cash provided by financing activities was $1.8 million. Total debt at September 30, 2010 was $344.7 million, and debt net of cash on hand was $256.8 million. At September 30, 2010, we had $10.0 million drawn under our $175.0 million revolving credit facility.

     We anticipate that our current level of cash on hand, cash flows from operations and availability under our credit facility will be adequate to repay our debts due and will provide sufficient resources to finance our operating requirements. However, our ability to fund working capital, capital expenditures and debt service in excess of cash on hand will be dependent on the success of our operations. To the extent that existing sources are insufficient to meet those cash requirements, we would seek other debt or equity financing; however, we can give no assurances that such debt or equity financing would be available on acceptable terms.

Currency Fluctuations and Inflation

     The majority of our operations are international; therefore we are exposed to currency fluctuations and exchange rate risks. Charters for vessels in the North Sea fleet are primarily denominated in Pound Sterling (GBP) with a portion denominated in Norwegian Kroner (NOK) and Euros. In most cases and when possible our operating costs are denominated in the same currency as charter hire in order to reduce the risk of currency fluctuations. For the periods indicated, the average equivalent exchange rates per one U.S. Dollar (US$) were:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2010		2009		2010		2009
	1 US$=				1 US$=
GBP		0.645		0.609		0.652		0.648
NOK		6.156		6.106		6.074		6.468
Euro		0.774		0.699		0.760		0.732

     Reflected in the accompanying balance sheet as of September 30, 2010, is $42.4 million in accumulated other comprehensive income that fluctuates based on differences in foreign currency exchange rates as of each balance sheet date. Also included in accumulated other comprehensive income is a loss of $3.9 million related to the cash flow hedges. Changes in other comprehensive income are primarily non-cash items that are attributable to investments in vessels and dollar based capitalization between our parent company and our foreign subsidiaries.

     After evaluating the U.S. Dollar debt, we have determined that it is in our best interest not to use any financial instruments to hedge the exposure of our revenue and costs of operations to currency fluctuations under present conditions. Our decision is based on a number of factors, including among others:

• the cost of using hedging instruments in relation to the risks of currency fluctuations,

• the propensity for adjustments in currency denominated vessel day rates over time to compensate for changes in the purchasing power of the currency as measured in U.S. Dollars,

• the level of U.S. Dollar denominated borrowings available to us, and

• the conditions in our U.S. Dollar generating regional markets.

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     One or more of these factors may change; in response, we may choose to use financial instruments to hedge risks of currency fluctuations with regards to our revenue and costs of operations. We periodically enter into forward currency contracts to specifically hedge the foreign currency exposure related to firm contractual commitments in the form of future vessel payments. These hedging relationships were formally documented at inception and the contracts have been and continue to be highly effective. As a result, by design, there is an exact offset between the gain or loss exposure in the related underlying contractual commitment. At December 31, 2009, we had forward currency contracts on two vessels under construction. As of February 2010, we had taken delivery of the new build vessels and had terminated the associated foreign currency contracts.

     We also have an interest rate swap agreement for a portion of the Facility Agreement that has fixed the interest rate at 4.145% on $100.0 million of the Facility. The interest rate swap is accounted for as a cash flow hedge. We report changes in the fair value of the cash flow hedges in accumulated other comprehensive income. The consolidated balance sheet also contains “cash flow hedges,” in the liability section reflecting the fair value of the interest rate swaps, which was $7.9 million at September 30, 2010. For the nine months ended September 30, 2010 a loss of $2.0 million has been reclassified from other comprehensive income to interest expense. We expect to reclassify $3.3 million of deferred loss on the interest rate swaps to interest expense during the next 12 months, based on current interest rates.

     To date, general inflationary trends have not had a material effect on our operating revenues or expenses.

Off-Balance Sheet Arrangements

     We have evaluated our off-balance sheet arrangements, and have concluded that we do not have any material relationships with unconsolidated entities or financial partnerships that have been established for the purpose of facilitating off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulations S-K). Based on this evaluation we believe that no disclosures relating to off-balance sheet arrangements are required.

Forward-Looking Statements

     This Form 10-Q contains certain forward-looking statements and other statements that are not historical facts concerning, among other things, market conditions, the demand for marine and transportation support services and future capital expenditures. These statements are subject to certain risks, uncertainties and assumptions, including, without limitation:

• operational risk,

• catastrophic or adverse sea or weather conditions,

• dependence on the oil and gas industry,

• volatility in oil and natural gas prices,

• delay or cost overruns on construction projects or insolvency of the shipbuilders,

• lack of shipyard or equipment availability,

• ongoing capital expenditure requirements,

• uncertainties surrounding environmental and governmental laws and regulations,

• uncertainties and risks relating to or caused by the April 2010 explosion and fire on a deepwater U.S. Gulf of Mexico drilling rig, the resulting losses and the effects of regulations associated with the lifting of the moratorium on deepwater drilling,

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• risks relating to compliance with the Jones Act,

• risks relating to leverage,

• risks of foreign operations,

• risk of war, sabotage, piracy or terrorism,

• assumptions concerning competition,

• risks of currency fluctuations, and

• other matters.

     These statements are based on certain assumptions and analyses made by us in light of our experience and perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Such statements are subject to risks and uncertainties, including the risk factors discussed above and those discussed in our Form 10-K for the year ended December 31, 2009, filed with the SEC, general economic and business conditions, the business opportunities that may be presented to and pursued by us, changes in law or regulations and other factors, many of which are beyond our control.

     We cannot assure you that we have accurately identified and properly weighed all of the factors that affect market conditions and demand for our vessels, that the information on which we have relied is accurate or complete, that our analysis of the market and demand for our vessels is correct, or that the strategy based on that analysis will be successful.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Sensitivity

     Our financial instruments that are potentially sensitive to changes in interest rates include our 7.75% Senior Notes. As of September 30, 2010, the fair value of these notes, based on quoted market prices, was approximately $163.4 million compared to a carrying amount of $159.7 million.

Exchange Rate Sensitivity

     We operate in a number of international areas and are involved in transactions denominated in currencies other than U.S. Dollars, which exposes us to foreign currency exchange risk. At various times we may utilize forward exchange contracts, local currency borrowings and the payment structure of customer contracts to selectively hedge exposure to exchange rate fluctuations in connection with monetary assets, liabilities and cash flows denominated in certain foreign currency. We do not hold or issue forward exchange contracts or other derivative financial instruments for speculative purposes.

     Other information required under Part I, Item 3 is set forth in Management’s Discussion and Analysis of Financial Condition and Results of Operations and is incorporated herein.

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ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

     Based on their evaluation of our disclosure controls and procedures as of the end of the period covered by this report, our Chief Executive Officer and Chief Financial Officer have concluded that the disclosure controls and procedures are effective for the period covered by the report, ensuring that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

(b) Evaluation of internal controls and procedures.

     As of December 31, 2009, our management determined that our internal controls over financial reporting were effective. Our assessment of the effectiveness of our internal controls over financial reporting as of December 31, 2009, has been audited by UHY LLP, an independent public accounting firm, as stated in our Form 10-K for the year ended December 31, 2009 filed with the SEC.

     There were no changes in our internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS

     The following risk factor changed since the Company previously disclosed the risk factor in Item 1A in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010, filed with the Securities and Exchange Commission on July 29, 2010.

Recent Events in the U.S. Gulf of Mexico Have Adversely Impacted and Are Likely to Continue to Adversely Impact Our Operations and Financial Condition.

     On April 20, 2010, an explosion and fire on a deepwater U.S. Gulf of Mexico drilling rig resulted in 11 deaths, multiple personal injuries, significant property damage and the release of hydrocarbons that resulted in significant pollution and contamination. In May 2010, the U.S. Department of Interior issued a memorandum imposing a temporary moratorium on deepwater drilling on the outer continental shelf. This moratorium was lifted on October 12, 2010, subject, however, to new standards, requirements and regulations that must be complied with before drilling can commence. Additionally, the President has appointed a commission that is studying the causes of the catastrophe for the purpose of recommending to the President what legislative or regulatory measures should be taken in order to minimize the possibility of a recurrence of a disastrous oil spill.

     The catastrophe and moratorium have significantly and adversely disrupted oil and gas exploration and development activities in the U.S. Gulf of Mexico. It remains uncertain what impact the incident may have on the regulation of offshore oil and gas exploration and development activity, the cost or availability of insurance coverage to cover the risks of such operations, or what actions may be taken by our customers, governmental agencies, or other industry participants in response to the incident. In addition, we cannot predict whether any

25

possible changes in regulations would affect only deepwater drilling or all operations in the U.S. Gulf of Mexico or would also affect drilling and operations in other regions around the world in which we operate. At this time, various bills are being considered by Congress which, if enacted, could either significantly increase the costs of conducting oil and gas drilling and exploration activities in the U.S. Gulf of Mexico, or potentially drive a substantial portion of drilling and operation activity out of the U.S. Gulf of Mexico. There is uncertainty as to whether Congress will repeal the $75.0 million limitation for non-reclamation liability under the Oil Pollution Act of 1990 and revise penalties for pollution liabilities, broaden liability under the Jones Act and Death on the High Seas Act, and restrict certain rights to limit liability of a vessel owner under the Limitations of Liability Act of 1851. Significant changes in these laws could have a material adverse effect on our business.

     The disruption in oil and gas exploration activities from the moratorium had a material adverse impact on our U.S. Gulf of Mexico drilling support operations in the second and third quarters of 2010; even with the lifting of the moratorium, we expect further adverse impact to continue through the fourth quarter of 2010 and into 2011. Announced and anticipated changes in laws and regulations regarding offshore oil and gas exploration and development activities, the cost or availability of insurance, and decisions by customers, governmental agencies, or other industry participants could further reduce demand for our services or increase our costs of operations. This could further increase the adverse impact on our financial condition and operating results, but we cannot reasonably or reliably estimate to what extent such changes will occur, when they will occur, or how severely they will impact us.

     We currently have a portion of our U.S. fleet involved in the clean-up efforts in the Gulf of Mexico, and these vessels continue to be released into a more restricted and more competitive market in the U.S. Gulf of Mexico. We may attempt to relocate these vessels to other locations in the Americas if more profitable opportunities arise outside the U.S. Gulf of Mexico; however, no assurance can be given that our vessels can be relocated outside the U.S. Gulf of Mexico, or can relocate more profitably than in the U.S. Gulf of Mexico. As a result of the incident in the U.S. Gulf of Mexico and the subsequent issues regarding drilling in the region, our competitors could redeploy their vessels into other regions in which we operate, which would increase the competition in that area, potentially resulting in lowered profit margins. In addition, our customers may seek to renegotiate the terms of their contracts or avoid their obligations under the contracts, both of which could adversely affect our business, financial condition and results of operations.

     On July 14, 2010, we were named as one of several vessel owner/operator defendants, among other defendants, in litigation pertaining to firefighting and other vessel activities associated with the April catastrophe. On October 12, 2010, we were dismissed from this litigation. Although we have no knowledge of any other litigation or claims against us relating to the recent events in the U.S. Gulf of Mexico, no assurance can be given that we will not be involved in other litigation or claims in the future or that they will not have a material adverse effect on our financial condition or results of operation.

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ITEM 6. EXHIBITS

Exhibits

     See Exhibit Index for list of Exhibits filed herewith.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	GulfMark Offshore, Inc.
	(Registrant)
By:	/s/ Quintin V. Kneen
	Quintin V. Kneen
	Executive Vice President & Chief Financial Officer

Date: October 27, 2010

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INDEX TO EXHIBITS

		Filed Herewith or
		Incorporated by Reference
		from the
Exhibits	Description	Following Documents
3.1	Certificate of Incorporation, as amended	Exhibit 3.1 to our current report on Form 8-K filed on February 24, 2010
3.2	Bylaws, as amended	Exhibit 3.2 to our current report on Form 8-K filed on February 24, 2010
4.1	Description of GulfMark Offshore, Inc. Common Stock	Exhibit 4.1 to our current report on Form 8-K filed on February 24, 2010
4.2	Form of U.S. Citizen Stock Certificates	Exhibit 4.2 to our current report on Form 8-K filed on February 24, 2010
4.3	Form of Non-U.S. Citizen Stock Certificates	Exhibit 4.3 to our current report on Form 8-K filed on February 24, 2010
4.4	Indenture, dated as of July 21, 2004, between GulfMark Offshore, Inc., as the Company, and U.S. Bank National Association, as Trustee, including a form of the Company’s 7.75% Senior Notes due 2014	Exhibit 4.4 to our quarterly report on Form 10-Q for the quarter ended September 30, 2004
4.5	First Supplemental Indenture, dated as of February 24, 2010, between GulfMark Offshore, Inc. (f/k/a New GulfMark Offshore, Inc.), as the Company and U.S. Bank Association, as Trustee, for the Company’s 7.75% Senior Notes due 2014	Exhibit 10.1 to our current report on Form 8-K filed on February 24, 2010
4.6	Form of Debt Securities Indenture (Including Form of Note for Debt Securities)	Exhibit 4.7 to our Post-Effective Amendment No. 2/A to our Registration Statement on Form S-3 filed on May 14, 2010.
4.7	See Exhibit No. 3.1 for provisions of the Certificate of Incorporation and Exhibit 3.2 for provisions of the Bylaws defining the rights of the holders of Common Stock	Exhibits 3.1 and 3.2 to our current report on Form 8-K filed on February 24, 2010
10.1	Executive Nonqualified Excess Plan Document	Filed herewith
10.2	Executive Nonqualified Excess Plan Adoption Agreement, amended effective January 1, 2010	Filed herewith
10.3	Form of the Executive Nonqualified Excess Plan and Nonqualified Plan Participation Agreement	Filed herewith
31.1	Section 302 Certification for B.A. Streeter	Filed herewith

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31.2	Section 302 Certification for Q.V. Kneen	Filed herewith
32.1	Section 906 Certification furnished for B.A. Streeter	Filed herewith
32.2	Section 906 Certification furnished for Q. V. Kneen	Filed herewith
101	The following materials from GulfMark Offshore, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010, formatted in XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Stockholders’ Equity (iv) Condensed Consolidated Statement of Cash Flows and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.	Filed herewith

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EX-10.1

Exhibit 10.1

THE EXECUTIVE NONQUALIFIED EXCESS PLAN
PLAN DOCUMENT

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THE EXECUTIVE NONQUALIFIED EXCESS PLAN

     Section 1. Purpose:

     By execution of the Adoption Agreement, the Employer has adopted the Plan set forth herein, and in the Adoption Agreement, to provide a means by which certain management Employees or Independent Contractors of the Employer may elect to defer receipt of current Compensation from the Employer in order to provide retirement and other benefits on behalf of such Employees or Independent Contractors of the Employer, as selected in the Adoption Agreement. The Plan is intended to be a nonqualified deferred compensation plan that complies with the provisions of Section 409A of the Internal Revenue Code (the “Code”). The Plan is also intended to be an unfunded plan maintained primarily for the purpose of providing deferred compensation benefits for a select group of management or highly compensated employees under Sections 201(2), 301(a)(3) and 401(a)(l) of the Employee Retirement Income Security Act of 1974 (“ERISA”) and independent contractors. Notwithstanding any other provision of this Plan, this Plan shall be interpreted, operated and administered in a manner consistent with these intentions.

     Section 2. Definitions:

     As used in the Plan, including this Section 2, references to one gender shall include the other, unless otherwise indicated by the context:

     2.1 “Active Participant” means, with respect to any day or date, a Participant who is in Service on such day or date; provided, that a Participant shall cease to be an Active Participant (i) immediately upon a determination by the Committee that the Participant has ceased to be an Employee or Independent Contractor, or (ii) at the end

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of the Plan Year that the Committee determines the Participant no longer meets the eligibility requirements of the Plan.

     2.2 “Adoption Agreement” means the written agreement pursuant to which the Employer adopts the Plan. The Adoption Agreement is a part of the Plan as applied to the Employer.

     2.3 “Beneficiary” means the person, persons, entity or entities designated or determined pursuant to the provisions of Section 13 of the Plan.

     2.4 “Board” means the Board of Directors of the Company, if the Company is a corporation. If the Company is not a corporation, “Board” shall mean the Company.

     2.5 “Change in Control Event” means an event described in Section 409A(a)(2)(A)(v) of the Code (or any successor provision thereto) and the regulations thereunder.

     2.6 “Committee” means the persons or entity designated in the Adoption Agreement to administer the Plan. If the Committee designated in the Adoption Agreement is unable to serve, the Employer shall satisfy the duties of the Committee provided for in Section 9.

     2.7 “Company” means the company designated in the Adoption Agreement as such.

     2.8 “Compensation” shall have the meaning designated in the Adoption Agreement.

     2.9 “Crediting Date” means the date designated in the Adoption Agreement for crediting the amount of any Participant Deferral Credits or Employer Credits to the Deferred Compensation Account of a Participant.

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     2.10 “Deferred Compensation Account” means the account maintained with respect to each Participant under the Plan. The Deferred Compensation Account shall be credited with Participant Deferral Credits and Employer Credits, credited or debited for deemed investment gains or losses, and adjusted for payments in accordance with the rules and elections in effect under Section 8. The Deferred Compensation Account of a Participant shall include any In-Service or Education Account of the Participant, if applicable.

     2.11 “Disabled” means Disabled within the meaning of Section 409A of the Code and the regulations thereunder. Generally, this means that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering Employees of the Employer.

     2.12 “Education Account” is an In-Service Account which will be used by the Participant for educational purposes.

     2.13 “Effective Date” shall be the date designated in the Adoption Agreement.

     2.14 “Employee” means an individual in the Service of the Employer if the relationship between the individual and the Employer is the legal relationship of employer and employee. An individual shall cease to be an Employee upon the Employee’s separation from Service.

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     2.15 “Employer” means the Company, as identified in the Adoption Agreement, and any Participating Employer which adopts this Plan. An Employer may be a corporation, a limited liability company, a partnership or sole proprietorship.

     2.16 “Employer Credits” means the amounts credited to the Participant’s Deferred Compensation Account by the Employer pursuant to the provisions of Section 4.2.

     2.17 “Grandfathered Amounts” means, if applicable, the amounts that were deferred under the Plan and were earned and vested within the meaning of Section 409A of the Code and regulations thereunder as of December 31, 2004. Grandfathered Amounts shall be subject to the terms designated in the Adoption Agreement.

     2.18 “Independent Contractor” means an individual in the Service of the Employer if the relationship between the individual and the Employer is not the legal relationship of employer and employee. An individual shall cease to be an Independent Contractor upon the termination of the Independent Contractor’s Service. An Independent Contractor shall include a director of the Employer who is not an Employee.

     2.19 “In-Service Account” means a separate account to be kept for each Participant that has elected to take in-service distributions as described in Section 5.4. The In-Service Account shall be adjusted in the same manner and at the same time as the Deferred Compensation Account under Section 8 and in accordance with the rules and elections in effect under Section 8.

     2.20 “Normal Retirement Age” of a Participant means the age designated in the Adoption Agreement.

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     2.21 “Participant” means with respect to any Plan Year an Employee or Independent Contractor who has been designated by the Committee as a Participant and who has entered the Plan or who has a Deferred Compensation Account under the Plan; provided that if the Participant is an Employee, the individual must be a highly compensated or management employee of the Employer within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

     2.22 “Participant Deferral Credits” means the amounts credited to the Participant’s Deferred Compensation Account by the Employer pursuant to the provisions of Section 4.1.

     2.23 “Participating Employer” means any trade or business (whether or not incorporated) which adopts this Plan with the consent of the Company identified in the Adoption Agreement.

     2.24 “Participation Agreement” means a written agreement entered into between a Participant and the Employer pursuant to the provisions of Section 4.1

     2.25 “Performance-Based Compensation” means compensation where the amount of, or entitlement to, the compensation is contingent on the satisfaction of preestablished organizational or individual performance criteria relating to a performance period of at least twelve months. Organizational or individual performance criteria are considered preestablished if established in writing within 90 days after the commencement of the period of service to which the criteria relates, provided that the outcome is substantially uncertain at the time the criteria are established. Performance- based compensation may include payments based upon subjective performance criteria as

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provided in regulations and administrative guidance promulgated under Section 409A of the Code.

     2.26 “Plan” means The Executive Nonqualified Excess Plan, as herein set out and as set out in the Adoption Agreement, or as duly amended. The name of the Plan as applied to the Employer shall be designated in the Adoption Agreement.

     2.27 “Plan-Approved Domestic Relations Order” shall mean a judgment, decree, or order (including the approval of a settlement agreement) which is:

     2.27.1 Issued pursuant to a State’s domestic relations law;

     2.27.2 Relates to the provision of child support, alimony payments or marital property rights to a Spouse, former Spouse, child or other dependent of the Participant;

     2.27.3 Creates or recognizes the right of a Spouse, former Spouse, child or other dependent of the Participant to receive all or a portion of the Participant’s benefits under the Plan;

     2.27.4 Requires payment to such person of their interest in the Participant’s benefits in a lump sum payment at a specific time; and

     2.27.5 Meets such other requirements established by the Committee.

     2.28 “Plan Year” means the twelve-month period ending on the last day of the month designated in the Adoption Agreement; provided that the initial Plan Year may have fewer than twelve months.

     2.29 “Qualifying Distribution Event” means (i) the Separation from Service of the Participant, (ii) the date the Participant becomes Disabled, (iii) the death of the Participant, (iv) the time specified by the Participant for an In-Service or Education Distribution, (v) a Change in Control Event, or (vi) an Unforeseeable Emergency, each to the extent provided in Section 5.

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     2.30 “Seniority Date” shall have the meaning designated in the Adoption Agreement.

     2.31 “Separation from Service” or “Separates from Service” means a “separation from service” within the meaning of Section 409A of the Code.

     2.32 “Service” means employment by the Employer as an Employee. For purposes of the Plan, the employment relationship is treated as continuing intact while the Employee is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the Employee’s right to reemployment is provided either by statute or contract. If the Participant is an Independent Contractor, “Service” shall mean the period during which the contractual relationship exists between the Employer and the Participant. The contractual relationship is not terminated if the Participant anticipates a renewal of the contract or becomes an Employee.

     2.33 “Service Bonus” means any bonus paid to a Participant by the Employer which is not Performance-Based Compensation.

     2.34 “Specified Employee” means an employee who meets the requirements for key employee treatment under Section 416(i)(l)(A)(i), (ii) or (iii) of the Code (applied in accordance with the regulations thereunder and without regard to Section 416(i)(5) of the Code) at any time during the twelve month period ending on December 31 of each year (the “identification date”). Unless binding corporate action is taken to establish different rules for determining Specified Employees for all plans of the Company and its controlled group members that are subject to Section 409A of the Code, the foregoing rules and the other default rules under the regulations of Section 409A of the Code shall

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apply. If the person is a key employee as of any identification date, the person is treated as a Specified Employee for the twelve-month period beginning on the first day of the fourth month following the identification date.

     2.35 “Spouse” or ‘‘Surviving Spouse” means, except as otherwise provided in the Plan, a person who is the legally married spouse or surviving spouse of a Participant.

     2.36 “Unforeseeable Emergency” means an “unforeseeable emergency” within the meaning of Section 409A of the Code.

     2.37 “Years of Service” means each Plan Year of Service completed by the Participant. For vesting purposes, Years of Service shall be calculated from the date designated in the Adoption Agreement and Service shall be based on service with the Company and all Participating Employers.

     Section 3. Participation:

     The Committee in its discretion shall designate each Employee or Independent Contractor who is eligible to participate in the Plan. A Participant who separates from Service with the Employer and who later returns to Service will not be an Active Participant under the Plan except upon satisfaction of such terms and conditions as the Committee shall establish upon the Participant’s return to Service, whether or not the Participant shall have a balance remaining in the Deferred Compensation Account under the Plan on the date of the return to Service.

     Section 4. Credits to Deferred Compensation Account:

     4.1 Participant Deferral Credits. To the extent provided in the Adoption Agreement, each Active Participant may elect, by entering into a Participation Agreement with the Employer, to defer the receipt of Compensation from the Employer by a dollar

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amount or percentage specified in the Participation Agreement. The amount of Compensation the Participant elects to defer, the Participant Deferral Credit, shall be credited by the Employer to the Deferred Compensation Account maintained for the Participant pursuant to Section 8. The following special provisions shall apply with respect to the Participant Deferral Credits of a Participant:

     4.1.1 The Employer shall credit to the Participant’s Deferred Compensation Account on each Crediting Date an amount equal to the total Participant Deferral Credit for the period ending on such Crediting Date.

     4.1.2 An election pursuant to this Section 4.1 shall be made by the Participant by executing and delivering a Participation Agreement to the Committee. Except as otherwise provided in this Section 4.1, the Participation Agreement shall become effective with respect to such Participant as of the first day of January following the date such Participation Agreement is received by the Committee. A Participant’s election may be changed at any time prior to the last permissible date for making the election as permitted in this Section 4.1, and shall thereafter be irrevocable. The election of a Participant shall continue in effect for subsequent years until modified by the Participant as permitted in this Section 4.1.

     4.1.3 A Participant may execute and deliver a Participation Agreement to the Committee within 30 days after the date the Participant first becomes eligible to participate in the Plan to be effective as of the first payroll period next following the date the Participation Agreement is fully executed by the Participant. Whether a Participant is treated as newly eligible for participation under this Section shall be determined in accordance with Section 409A of the Code and the regulations thereunder, including (i) rules that treat all elective deferral account balance plans as one plan, and (ii) rules that treat a previously eligible employee as newly eligible if his benefits had been previously distributed or if he has been ineligible for 24 months. For Compensation that is earned based upon a specified performance period (for example, an annual bonus), where a deferral election is made under this Section but after the beginning of the performance period, the election will only apply to the portion of the Compensation equal to the total amount of the Compensation for the service period multiplied by the ratio of the number of days remaining in the performance period after the election over the total number of days in the performance period.

     4.1.4 A Participant may unilaterally modify a Participation Agreement (either to terminate, increase or decrease the portion of his future Compensation which is subject to deferral within the percentage limits set forth in Section 4.1 of the Adoption Agreement) by providing a written modification of the Participation Agreement to the Committee. The modification shall become effective as of the first day of January following the date such written modification is received by the Committee.

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     4.1.5 If the Participant performed services continuously from the later of the beginning of the performance period or the date upon which the performance criteria are established through the date upon which the Participant makes an initial deferral election, a Participation Agreement relating to the deferral of Performance-Based Compensation may be executed and delivered to the Committee no later than the date which is 6 months prior to the end of the performance period, provided that in no event may an election to defer Performance-Based Compensation be made after such Compensation has become readily ascertainable.

     4.1.6 If the Employer has a fiscal year other than the calendar year, Compensation relating to Service in the fiscal year of the Employer (such as a bonus based on the fiscal year of the Employer), of which no amount is paid or payable during the fiscal year, may be deferred at the Participant’s election if the election to defer is made not later than the close of the Employer’s fiscal year next preceding the first fiscal year in which the Participant performs any services for which such Compensation is payable.

     4.1.7 Compensation payable after the last day of the Participant’s taxable year solely for services provided during the final payroll period containing the last day of the Participant’s taxable year (i.e., December 31) is treated for purposes of this Section 4.1 as Compensation for services performed in the subsequent taxable year.

     4.1.8 The Committee may from time to time establish policies or rules consistent with the requirements of Section 409A of the Code to govern the manner in which Participant Deferral Credits may be made.

     4.1.9 If a Participant becomes Disabled, or applies for and is eligible for a distribution on account of an Unforeseeable Emergency during a Plan Year or as required due to a hardship distribution under Section 1.401(k)-1(d)(3) of the Code, his deferral election for such Plan Year shall be cancelled.

     4.2 Employer Credits. If designated by the Employer in the Adoption Agreement, the Employer shall cause the Committee to credit to the Deferred Compensation Account of each Active Participant an Employer Credit as determined in accordance with the Adoption Agreement. A Participant must make distribution elections with respect to any Employer Credits credited to his Deferred Compensation Account by the deadline that would apply under Section 4.1 for distribution elections with respect to Participant Deferral Credits credited at the same time, on a Participation

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Agreement that is timely executed and delivered to the Committee pursuant to Section 4.1.

     4.3 Deferred Compensation Account. All Participant Deferral Credits and Employer Credits shall be credited to the Deferred Compensation Account of the Participant as provided in Section 8.

     Section 5. Qualifying Distribution Events:

     5.1 Separation from Service. If the Participant Separates from Service with the Employer, the vested balance in the Deferred Compensation Account shall be paid to the Participant by the Employer as provided in Section 7. Notwithstanding the foregoing, no distribution shall be made earlier than six months after the date of Separation from Service (or, if earlier, the date of death) with respect to a Participant who as of the date of Separation from Service is a Specified Employee of a corporation the stock in which is traded on an established securities market or otherwise. Any payments to which such Specified Employee would be entitled during the first six months following the date of Separation from Service shall be accumulated and paid on the first day of the seventh month following the date of Separation from Service.

     5.2 Disability. If the Employer designates in the Adoption Agreement that distributions are permitted under the Plan when a Participant becomes Disabled, and the Participant becomes Disabled while in Service, the vested balance in the Deferred Compensation Account shall be paid to the Participant by the Employer as provided in Section 7.

     5.3 Death. If the Participant dies while in Service, the Employer shall pay a benefit to the Participant’s Beneficiary in the amount designated in the Adoption

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Agreement. Payment of such benefit shall be made by the Employer as provided in Section 7.

     5.4 In-Service or Education Distributions. If the Employer designates in the Adoption Agreement that in-service or education distributions are permitted under the Plan, a Participant may designate in the Participation Agreement to have a specified amount credited to the Participant’s In-Service or Education Account for in-service or education distributions at the date specified by the Participant. In no event may an in- service or education distribution of an amount be made before the date that is two years after the first day of the year in which such amount was credited to the In-Service or Education Account. Notwithstanding the foregoing, if a Participant incurs a Qualifying Distribution Event prior to the date on which the entire balance in the In-Service or Education Account has been distributed, then the balance in the In-Service or Education Account on the date of the Qualifying Distribution Event shall be paid as provided under Section 7.1 for payments on such Qualifying Distribution Event.

     5.5 Change in Control Event. If the Employer designates in the Adoption Agreement that distributions are permitted under the Plan upon the occurrence of a Change in Control Event, the Participant may designate in the Participation Agreement to have the vested balance in the Deferred Compensation Account paid to the Participant upon a Change in Control Event by the Employer as provided in Section 7.

     5.6 Unforeseeable Emergency. If the Employer designates in the Adoption Agreement that distributions are permitted under the Plan upon the occurrence of an Unforeseeable Emergency event, a distribution from the Deferred Compensation Account

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may be made to a Participant in the event of an Unforeseeable Emergency, subject to the following provisions:

     5.6.1 A Participant may, at any time prior to his Separation from Service for any reason, make application to the Committee to receive a distribution in a lump sum of all or a portion of the vested balance in the Deferred Compensation Account (determined as of the date the distribution, if any, is made under this Section 5.6) because of an Unforeseeable Emergency. A distribution because of an Unforeseeable Emergency shall not exceed the amount required to satisfy the Unforeseeable Emergency plus amounts necessary to pay taxes reasonably anticipated as a result of such distribution, after taking into account the extent to which the Unforeseeable Emergency may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship) or by stopping current deferrals under the Plan pursuant to Section 4.1.9.

     5.6.2 The Participant’s request for a distribution on account of Unforeseeable Emergency must be made in writing to the Committee. The request must specify the nature of the financial hardship, the total amount requested to be distributed from the Deferred Compensation Account, and the total amount of the actual expense incurred or to be incurred on account of the Unforeseeable Emergency.

     5.6.3 If a distribution under this Section 5.6 is approved by the Committee, such distribution will be made as soon as practicable following the date it is approved. The processing of the request shall be completed as soon as practicable from the date on which the Committee receives the properly completed written request for a distribution on account of an Unforeseeable Emergency. If a Participant’s Separation from Service occurs after a request is approved in accordance with this Section 5.6.3, but prior to distribution of the full amount approved, the approval of the request shall be automatically null and void and the benefits which the Participant is entitled to receive under the Plan shall be distributed in accordance with the applicable distribution provisions of the Plan.

     5.6.4 The Committee may from time to time adopt additional policies or rules consistent with the requirements of Section 409A of the Code to govern the manner in which such distributions may be made so that the Plan may be conveniently administered.

     Section 6. Vesting:

     A Participant shall be fully vested in the portion of his Deferred Compensation Account attributable to Participant Deferral Credits, and all income, gains and losses attributable thereto. A Participant shall become fully vested in the portion of his Deferred

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Compensation Account attributable to Employer Credits, and income, gains and losses attributable thereto, in accordance with the vesting schedule and provisions designated by the Employer in the Adoption Agreement. If a Participant’s Deferred Compensation Account is not fully vested upon Separation from Service, the portion of the Deferred Compensation Account that is not fully vested shall thereupon be forfeited.

     Section 7. Distribution Rules:

     7.1 Payment Options. The Employer shall designate in the Adoption Agreement the payment options which may be elected by the Participant (lump sum, annual installments, or a combination of both). Different payment options may be made available for each Qualifying Distribution Event, and different payment options may be available for different types of Separations from Service, all as designated in the Adoption Agreement. The Participant shall elect in the Participation Agreement the method under which the vested balance in the Deferred Compensation Account will be distributed from among the designated payment options. The Participant may at such time elect a different method of payment for each Qualifying Distribution Event as specified in the Adoption Agreement. If the Participant is permitted by the Employer in the Adoption Agreement to elect different payment options and does not make a valid election, the vested balance in the Deferred Compensation Account will be distributed as a lump sum.

     Notwithstanding the foregoing, if certain Qualifying Distribution Events occur prior to the date on which the vested balance of a Participant’s Deferred Compensation Account is completely paid pursuant to this Section 7.1 following the occurrence of certain initial Qualifying Distribution Events, the following rules apply:

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     7.1.1 If the initial Qualifying Distribution Event is a Separation from Service or Disability, and the Participant subsequently dies, the remaining unpaid vested balance of a Participant’s Deferred Compensation Account shall be paid as a lump sum.

     7.1.2 If the initial Qualifying Distribution Event is a Change in Control Event, and any subsequent Qualifying Distribution Event occurs (except an In-Service or Education Distribution described in Section 2.29(iv)), the remaining unpaid vested balance of a Participant’s Deferred Compensation Account shall be paid as provided under Section 7.1 for payments on such subsequent Qualifying Distribution Event.

     7.2 Timing of Payments. Payment shall be made in the manner elected by the Participant and shall commence as soon as practicable after (but no later than 60 days after) the distribution date elected for the Qualifying Distribution Event. In the event the Participant fails to make a valid election of the payment method, the distribution will be made in a single lump sum payment as soon as practicable after (but no later than 60 days after) the Qualifying Distribution Event. A payment may be further delayed to the extent permitted in accordance with regulations and guidance under Section 409A of the Code.

     7.3 Installment Payments. If the Participant elects to receive installment payments upon a Qualifying Distribution Event, the payment of each annual installment shall be made on the anniversary of the date of the first installment payment, and the amount of the annual installment shall be adjusted on such anniversary for credits or debits to the Participant’s account pursuant to Section 8 of the Plan. Such adjustment shall be made by dividing the balance in the Deferred Compensation Account on such date by the number of annual installments remaining to be paid hereunder; provided that the last annual installment due under the Plan shall be the entire amount credited to the Participant’s account on the date of payment.

     7.4 De Minimis Amounts. Notwithstanding any payment election made by the Participant, if the Employer designates a pre-determined de minimis amount in the

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Adoption Agreement, the vested balance in the Deferred Compensation Account of the Participant will be distributed in a single lump sum payment if at the time of a permitted Qualifying Distribution Event the vested balance does not exceed such pre-determined de minimis amount; provided, however, that such distribution will be made only where the Qualifying Distribution Event is a Separation from Service, death, Disability (if applicable) or Change in Control Event (if applicable). Such payment shall be made on or before the later of (i) December 31 of the calendar year in which the Qualifying Distribution Event occurs, or (ii) the date that is 2-1/2 months after the Qualifying Distribution Event occurs. In addition, the Employer may distribute a Participant’s vested balance at any time if the balance does not exceed the limit in Section 402(g)(1)(B) of the Code and results in the termination of the Participant’s entire interest in the Plan as provided under Section 409A of the Code.

     7.5 Subsequent Elections. With the consent of the Committee, a Participant may delay or change the method of payment of the Deferred Compensation Account subject to the following requirements:

     7.5.1 The new election may not take effect until at least 12 months after the date on which the new election is made.

     7.5.2 If the new election relates to a payment for a Qualifying Distribution Event other than the death of the Participant, the Participant becoming Disabled, or an Unforeseeable Emergency, the new election must provide for the deferral of the payment for a period of at least five years from the date such payment would otherwise have been made.

     7.5.3 If the new election relates to a payment from the In-Service or Education Account, the new election must be made at least 12 months prior to the date of the first scheduled payment from such account.

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For purposes of this Section 7.5 and Section 7.6, a payment is each separately identified amount to which the Participant is entitled under the Plan; provided, that entitlement to a series of installment payments is treated as the entitlement to a single payment.

     7.6 Acceleration Prohibited. The acceleration of the time or schedule of any payment due under the Plan is prohibited except as expressly provided in regulations and administrative guidance promulgated under Section 409A of the Code (such as accelerations for domestic relations orders and employment taxes). It is not an acceleration of the time or schedule of payment if the Employer waives or accelerates the vesting requirements applicable to a benefit under the Plan.

     Section 8. Accounts; Deemed Investment; Adjustments to Account:

     8.1 Accounts. The Committee shall establish a book reserve account, entitled the “Deferred Compensation Account,” on behalf of each Participant. The Committee shall also establish an In-Service or Education Account as a part of the Deferred Compensation Account of each Participant, if applicable. The amount credited to the Deferred Compensation Account shall be adjusted pursuant to the provisions of Section 8.3.

     8.2 Deemed Investments. The Deferred Compensation Account of a Participant shall be credited with an investment return determined as if the account were invested in one or more investment funds made available by the Committee. The Participant shall elect the investment funds in which his Deferred Compensation Account shall be deemed to be invested. Such election shall be made in the manner prescribed by the Committee and shall take effect upon the entry of the Participant into the Plan. The investment election of the Participant shall remain in effect until a new election is made

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by the Participant. In the event the Participant fails for any reason to make an effective election of the investment return to be credited to his account, the investment return shall be determined by the Committee.

     8.3 Adjustments to Deferred Compensation Account. With respect to each Participant who has a Deferred Compensation Account under the Plan, the amount credited to such account shall be adjusted by the following debits and credits, at the times and in the order stated:

     8.3.1 The Deferred Compensation Account shall be debited each business day with the total amount of any payments made from such account since the last preceding business day to him or for his benefit. Unless otherwise specified by the Employer, each deemed investment fund will be debited pro-rata based on the value of the investment funds as of the end of the preceding business day.

     8.3.2 The Deferred Compensation Account shall be credited on each Crediting Date with the total amount of any Participant Deferral Credits and Employer Credits to such account since the last preceding Crediting Date.

     8.3.3 The Deferred Compensation Account shall be credited or debited on each day securities are traded on a national stock exchange with the amount of deemed investment gain or loss resulting from the performance of the investment funds elected by the Participant in accordance with Section 8.2. The amount of such deemed investment gain or loss shall be determined by the Committee and such determination shall be final and conclusive upon all concerned.

     Section 9. Administration by Committee:

     9.1 Membership of Committee. If the Committee consists of individuals appointed by the Board, they will serve at the pleasure of the Board. Any member of the Committee may resign, and his successor, if any, shall be appointed by the Board.

     9.2 General Administration. The Committee shall be responsible for the operation and administration of the Plan and for carrying out its provisions. The Committee shall have the full authority and discretion to make, amend, interpret, and enforce all appropriate rules and regulations for the administration of this Plan and decide

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or resolve any and all questions, including interpretations of this Plan, as may arise in connection with this Plan. Any such action taken by the Committee shall be final and conclusive on any party. To the extent the Committee has been granted discretionary authority under the Plan, the Committee’s prior exercise of such authority shall not obligate it to exercise its authority in a like fashion thereafter. The Committee shall be entitled to rely conclusively upon all tables, valuations, certificates, opinions and reports furnished by any actuary, accountant, controller, counsel or other person employed or engaged by the Employer with respect to the Plan. The Committee may, from time to time, employ agents and delegate to such agents, including employees of the Employer, such administrative or other duties as it sees fit.

     9.3 Indemnification. To the extent not covered by insurance, the Employer shall indemnify the Committee, each employee, officer, director, and agent of the Employer, and all persons formerly serving in such capacities, against any and all liabilities or expenses, including all legal fees relating thereto, arising in connection with the exercise of their duties and responsibilities with respect to the Plan, provided however that the Employer shall not indemnify any person for liabilities or expenses due to that person’s own gross negligence or willful misconduct

     Section 10. Contractual Liability, Trust:

     10.1 Contractual Liability. Unless otherwise elected in the Adoption Agreement, the Company shall be obligated to make all payments hereunder. This obligation shall constitute a contractual liability of the Company to the Participants, and such payments shall be made from the general funds of the Company. The Company shall not be required to establish or maintain any special or separate fund, or otherwise to

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segregate assets to assure that such payments shall be made, and the Participants shall not have any interest in any particular assets of the Company by reason of its obligations hereunder. To the extent that any person acquires a right to receive payment from the Company, such right shall be no greater than the right of an unsecured creditor of the Company.

     10.2 Trust. The Employer may establish a trust to assist it in meeting its obligations under the Plan. Any such trust shall conform to the requirements of a grantor trust under Revenue Procedures 92-64 and 92-65 and at all times during the continuance of the trust the principal and income of the trust shall be subject to claims of general creditors of the Employer under federal and state law. The establishment of such a trust would not be intended to cause Participants to realize current income on amounts contributed thereto, and the trust would be so interpreted and administered.

     Section 11. Allocation of Responsibilities:

     The persons responsible for the Plan and the duties and responsibilities allocated to each are as follows:

     11.1 Board.

(i)	To amend the Plan;
(ii)	To appoint and remove members of the Committee; and
(iii)	To terminate the Plan as permitted in Section 14.
11.2	Committee.
(i)	To designate Participants;
(ii)	To interpret the provisions of the Plan and to determine the rights of the Participants under the Plan, except to the extent otherwise provided in Section 16 relating to claims procedure;
(iii)	To administer the Plan in accordance with its terms, except to the extent powers to administer the Plan are specifically delegated to another person or persons as provided in the Plan;

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(iv)	To account for the amount credited to the Deferred Compensation Account of a Participant;
(v)	To direct the Employer in the payment of benefits;
(vi)	To file such reports as may be required with the United States Department of Labor, the Internal Revenue Service and any other government agency to which reports may be required to be submitted from time to time; and
(vii)	To administer the claims procedure to the extent provided in Section 16.

     Section 12. Benefits Not Assignable; Facility of Payments:

     12.1 Benefits Not Assignable. No portion of any benefit credited or paid under the Plan with respect to any Participant shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge, and any attempt so to anticipate, alienate, sell, transfer, assign, pledge, encumber or charge the same shall be void, nor shall any portion of such benefit be in any manner payable to any assignee, receiver or any one trustee, or be liable for his debts, contracts, liabilities, engagements or torts. Notwithstanding the foregoing, in the event that all or any portion of the benefit of a Participant is transferred to the former Spouse of the Participant incident to a divorce, the Committee shall maintain such amount for the benefit of the former Spouse until distributed in the manner required by an order of any court having jurisdiction over the divorce, and the former Spouse shall be entitled to the same rights as the Participant with respect to such benefit.

     12.2 Plan-Approved Domestic Relations Orders. The Committee shall establish procedures for determining whether an order directed to the Plan is a Plan- Approved Domestic Relations Order. If the Committee determines that an order is a Plan-Approved Domestic Relations Order, the Committee shall cause the payment of

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amounts pursuant to or segregate a separate account as provided by (and to prevent any payment or act which might be inconsistent with) the Plan-Approved Domestic Relations Order.

     12.3 Payments to Minors and Others. If any individual entitled to receive a payment under the Plan shall be physically, mentally or legally incapable of receiving or acknowledging receipt of such payment, the Committee, upon the receipt of satisfactory evidence of his incapacity and satisfactory evidence that another person or institution is maintaining him and that no guardian or committee has been appointed for him, may cause any payment otherwise payable to him to be made to such person or institution so maintaining him. Payment to such person or institution shall be in full satisfaction of all claims by or through the Participant to the extent of the amount thereof.

     Section 13. Beneficiary:

     The Participant’s beneficiary shall be the person, persons, entity or entities designated by the Participant on the beneficiary designation form provided by and filed with the Committee or its designee. If the Participant does not designate a beneficiary, the beneficiary shall be his Surviving Spouse. If the Participant does not designate a beneficiary and has no Surviving Spouse, the beneficiary shall be the Participant’s estate. The designation of a beneficiary may be changed or revoked only by filing a new beneficiary designation form with the Committee or its designee. If a beneficiary (the “primary beneficiary”) is receiving or is entitled to receive payments under the Plan and dies before receiving all of the payments due him, the balance to which he is entitled shall be paid to the contingent beneficiary, if any, named in the Participant’s current beneficiary designation form. If there is no contingent beneficiary, the balance shall be

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paid to the estate of the primary beneficiary. Any beneficiary may disclaim all or any part of any benefit to which such beneficiary shall be entitled hereunder by filing a written disclaimer with the Committee before payment of such benefit is to be made. Such a disclaimer shall be made in a form satisfactory to the Committee and shall be irrevocable when filed. Any benefit disclaimed shall be payable from the Plan in the same manner as if the beneficiary who filed the disclaimer had predeceased the Participant.

     Section 14. Amendment and Termination of Plan:

     The Company may amend any provision of the Plan or terminate the Plan at any time; provided, that in no event shall such amendment or termination reduce the balance in any Participant’s Deferred Compensation Account as of the date of such amendment or termination, nor shall any such amendment affect the terms of the Plan relating to the payment of such Deferred Compensation Account. Notwithstanding the foregoing, the following special provisions shall apply:

     14.1 Termination in the Discretion of the Employer. Except as otherwise provided in Sections 14.2, the Company in its discretion may terminate the Plan and distribute benefits to Participants subject to the following requirements and any others specified under Section 409A of the Code:

     14.1.1 All arrangements sponsored by the Employer that would be aggregated with the Plan under Section 1.409A-l(c) of the Treasury Regulations are terminated.

     14.1.2 No payments other than payments that would be payable under the terms of the Plan if the termination had not occurred are made within 12 months of the termination date.

     14.1.3 All benefits under the Plan are paid within 24 months of the termination date.

     14.1.4 The Employer does not adopt a new arrangement that would be aggregated with the Plan under Section 1.409A-1(c) of the Treasury Regulations providing for the

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deferral of compensation at any time within 3 years following the date of termination of the Plan.

     14.1.5 The termination does not occur proximate to a downturn in the financial health of the Employer.

     14.2 Termination Upon Change in Control Event. If the Company terminates the Plan within thirty days preceding or twelve months following a Change in Control Event, the Deferred Compensation Account of each Participant shall become fully vested and payable to the Participant in a lump sum within twelve months following the date of termination, subject to the requirements of Section 409A of the Code.

     Section 15. Communication to Participants:

     The Employer shall make a copy of the Plan available for inspection by Participants and their beneficiaries during reasonable hours at the principal office of the Employer.

     Section 16. Claims Procedure:

     The following claims procedure shall apply with respect to the Plan:

     16.1 Filing of a Claim for Benefits. If a Participant or Beneficiary (the “claimant”) believes that he is entitled to benefits under the Plan which are not being paid to him or which are not being accrued for his benefit, he shall file a written claim therefore with the Committee.

     16.2 Notification to Claimant of Decision. Within 90 days after receipt of a claim by the Committee (or within 180 days if special circumstances require an extension of time), the Committee shall notify the claimant of the decision with regard to the claim. In the event of such special circumstances requiring an extension of time, there shall be furnished to the claimant prior to expiration of the initial 90-day period written notice of

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the extension, which notice shall set forth the special circumstances and the date by which the decision shall be furnished. If such claim shall be wholly or partially denied, notice thereof shall be in writing and worded in a manner calculated to be understood by the claimant, and shall set forth: (i) the specific reason or reasons for the denial; (ii) specific reference to pertinent provisions of the Plan on which the denial is based; (iii) a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and (iv) an explanation of the procedure for review of the denial and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under ERISA following an adverse benefit determination on review. Notwithstanding the foregoing, if the claim relates to a disability determination, the Committee shall notify the claimant of the decision within 45 days (which may be extended for an additional 30 days if required by special circumstances).

     16.3 Procedure for Review. Within 60 days following receipt by the claimant of notice denying his claim, in whole or in part, or, if such notice shall not be given, within 60 days following the latest date on which such notice could have been timely given, the claimant may appeal denial of the claim by filing a written application for review with the Committee. Following such request for review, the Committee shall fully and fairly review the decision denying the claim. Prior to the decision of the Committee, the claimant shall be given an opportunity to review pertinent documents and to submit issues and comments in writing.

     16.4 Decision on Review. The decision on review of a claim denied in whole or in part by the Committee shall be made in the following manner:

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     16.4.1 Within 60 days following receipt by the Committee of the request for review (or within 120 days if special circumstances require an extension of time), the Committee shall notify the claimant in writing of its decision with regard to the claim. In the event of such special circumstances requiring an extension of time, written notice of the extension shall be furnished to the claimant prior to the commencement of the extension. Notwithstanding the foregoing, if the claim relates to a disability determination, the Committee shall notify the claimant of the decision within 45 days (which may be extended for an additional 45 days if required by special circumstances).

     16.4.2 With respect to a claim that is denied in whole or in part, the decision on review shall set forth specific reasons for the decision, shall be written in a manner calculated to be understood by the claimant, and shall set forth:

(i)	the specific reason or reasons for the adverse determination;
(ii)	specific reference to pertinent Plan provisions on which the adverse determination is based;
(iii)	a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits; and
(iv)	a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain the information about such procedures, as well as a statement of the claimant’s right to bring an action under ERISA section 502(a).

     16.4.3 The decision of the Committee shall be final and conclusive.

     16.5 Action by Authorized Representative of Claimant. All actions set forth in this Section 16 to be taken by the claimant may likewise be taken by a representative of the claimant duly authorized by him to act in his behalf on such matters. The Committee may require such evidence as either may reasonably deem necessary or advisable of the authority to act of any such representative.

     Section 17. Miscellaneous Provisions:

     17.1 Set off. Notwithstanding any other provision of this Plan, the Employer may reduce the amount of any payment otherwise payable to or on behalf of a Participant

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hereunder (net of any required withholdings) at the time payment is due by the amount of any loan, cash advance, extension of credit or other obligation of the Participant to the Employer that is then due and payable, and the Participant shall be deemed to have consented to such reduction. In addition, the Employer may at any time offset a Participant’s Deferral Compensation Account by an amount up to $5,000 to collect any such amount in accordance with the requirements of Section 409A of the Code.

     17.2 Notices. Each Participant who is not in Service and each Beneficiary shall be responsible for furnishing the Committee or its designee with his current address for the mailing of notices and benefit payments. Any notice required or permitted to be given to such Participant or Beneficiary shall be deemed given if directed to such address and mailed by regular United States mail, first class, postage prepaid. If any check mailed to such address is returned as undeliverable to the addressee, mailing of checks will be suspended until the Participant or Beneficiary furnishes the proper address. This provision shall not be construed as requiring the mailing of any notice or notification otherwise permitted to be given by posting or by other publication.

     17.3 Lost Distributees. A benefit shall be deemed forfeited if the Committee is unable to locate the Participant or Beneficiary to whom payment is due on or before the fifth anniversary of the date payment is to be made or commence; provided, that the deemed investment rate of return pursuant to Section 8.2 shall cease to be applied to the Participant’s account following the first anniversary of such date; provided further, however, that such benefit shall be reinstated if a valid claim is made by or on behalf of the Participant or Beneficiary for all or part of the forfeited benefit.

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     17.4 Reliance on Data. The Employer and the Committee shall have the right to rely on any data provided by the Participant or by any Beneficiary. Representations of such data shall be binding upon any party seeking to claim a benefit through a Participant, and the Employer and the Committee shall have no obligation to inquire into the accuracy of any representation made at any time by a Participant or Beneficiary.

     17.5 Receipt and Release for Payments. Subject to the provisions of Section 17.1, any payment made from the Plan to or with respect to any Participant or Beneficiary, or pursuant to a disclaimer by a Beneficiary, shall, to the extent thereof, be in full satisfaction of all claims hereunder against the Plan and the Employer with respect to the Plan. The recipient of any payment from the Plan may be required by the Committee, as a condition precedent to such payment, to execute a receipt and release with respect thereto in such form as shall be acceptable to the Committee.

     17.6 Headings. The headings and subheadings of the Plan have been inserted for convenience of reference and are to be ignored in any construction of the provisions hereof.

     17.7 Continuation of Employment. The establishment of the Plan shall not be construed as conferring any legal or other rights upon any Employee or any persons for continuation of employment, nor shall it interfere with the right of the Employer to discharge any Employee or to deal with him without regard to the effect thereof under the Plan.

     17.8 Merger or Consolidation; Assumption of Plan. No Employer shall consolidate or merge into or with another corporation or entity, or transfer all or substantially all of its assets to another corporation, partnership, trust or other entity (a

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“Successor Entity”) unless such Successor Entity shall assume the rights, obligations and liabilities of the Employer under the Plan and upon such assumption, the Successor Entity shall become obligated to perform the terms and conditions of the Plan. Nothing herein shall prohibit the assumption of the obligations and liabilities of the Employer under the Plan by any Successor Entity.

     17.9 Construction. The Employer shall designate in the Adoption Agreement the state according to whose laws the provisions of the Plan shall be construed and enforced, except to the extent that such laws are superseded by ERISA and the applicable requirements of the Code.

     17.10 Taxes. The Employer or other payor may withhold a benefit payment under the Plan or a Participant’s wages, or the Employer may reduce a Participant’s Account balance, in order to meet any federal, state, or local or employment tax withholding obligations with respect to Plan benefits, as permitted under Section 409A of the Code. The Employer or other payor shall report Plan payments and other Plan-related information to the appropriate governmental agencies as required under applicable laws.

     Section 18. Transition Rules:

This Section 18 does not apply to plans newly established on or after January 1, 2009.

     18.1 2005 Election Termination. Notwithstanding Section 4.1.4, at any time during 2005, a Participant may terminate a Participation Agreement, or modify a Participation Agreement to reduce the amount of Compensation subject to the deferral election, so long as the Compensation subject to the terminated or modified Participation Agreement is includible in the income of the Participant in 2005 or, if later, in the taxable year in which the amounts are earned and vested.

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     18.2 2005 Deferral Election. The requirements of Section 4.1.2 relating to the timing of the Participation Agreement shall not apply to any deferral elections made on or before March 15, 2005, provided that (a) the amounts to which the deferral election relate have not been paid or become payable at the time of the election, (b) the Plan was in existence on or before December 31, 2004, (c) the election to defer compensation is made in accordance with the terms of the Plan as in effect on December 31, 2005 (other than a requirement to make a deferral election after March 15, 2005), and (d) the Plan is otherwise operated in accordance with the requirements of Section 409A of the Code.

     18.3 2005 Termination of Participation; Distribution. Notwithstanding anything in this Plan to the contrary, at any time during 2005, a Participant may terminate his or her participation in the Plan and receive a distribution of his Deferred Compensation Account balance on account of that termination, so long as the full amount of such distribution is includible in the Participant’s income in 2005 or, if later, in the taxable year of the Participant in which the amount is earned and vested.

     18.4 Payment Elections. Notwithstanding the provisions of Sections 7.1 or 7.5 of the Plan, a Participant may elect on or before December 31, 2008, the time or form of payment of amounts subject to Section 409A of the Code provided that such election applies only to amounts that would not otherwise be payable in the year of the election and does not cause an amount to paid in the year of the election that would not otherwise be payable in such year.

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EX-10.2

Exhibit 10.2

NOTE: Execution of this Adoption Agreement creates a legal liability of the Employer with significant tax consequences to the Employer and Participants. The Employer should obtain legal and tax advice from its professional advisors before adopting the Plan. Principal Life Insurance Company disclaims all liability for the legal and tax consequences which result from the elections made by the Employer in this Adoption Agreement.

Principal Life Insurance Company, Raleigh, NC 27612
A member of the Principal Financial Group^®

THE EXECUTIVE NONQUALIFIED “EXCESS” PLAN

ADOPTION AGREEMENT

          THIS AGREEMENT is the adoption by GM Offshore, Inc. (the “Company”) of the Executive Nonqualified Excess Plan (“Plan”).

W I T N E S S E T H:

          WHEREAS, the Company desires to adopt the Plan as an unfunded, nonqualified deferred compensation plan; and

          WHEREAS, the provisions of the Plan are intended to comply with the requirements of Section 409A of the Code and the regulations thereunder and shall apply to amounts subject to section 409A; and

          WHEREAS, the Company has been advised by Principal Life Insurance Company to obtain legal and tax advice from its professional advisors before adopting the Plan,

          NOW, THEREFORE, the Company hereby adopts the Plan in accordance with the terms and conditions set forth in this Adoption Agreement:

ARTICLE I

          Terms used in this Adoption Agreement shall have the same meaning as in the Plan, unless some other meaning is expressly herein set forth. The Employer hereby represents and warrants that the Plan has been adopted by the Employer upon proper authorization and the Employer hereby elects to adopt the Plan for the benefit of its Participants as referred to in the Plan. By the execution of this Adoption Agreement, the Employer hereby agrees to be bound by the terms of the Plan.

ARTICLE II

The Employer hereby makes the following designations or elections for the purpose of the Plan:

2.6 Committee: The duties of the Committee set forth in the Plan shall be satisfied by:

o    (a)	Company
þ    (b)	The administrative committee appointed by the Board to serve at the pleasure of the Board.
o    (c)	Board.
o    (d)	Other (specify):                                             .

DD 2320-3

2.8 Compensation: The “Compensation” of a Participant shall mean all of a Participant’s:

þ    (a)	Base salary.
þ    (b)	Service Bonus.
þ    (c)	Performance-Based Compensation earned in a period of 12 months or more.
o    (d)	Commissions.
o    (e)	Compensation received as an Independent Contractor reportable on Form 1099.
þ    (f)	Other: Director’s Fees.

2.9 Crediting Date: The Deferred Compensation Account of a Participant shall be credited with the amount of any Participant Deferral to such account at the time designated below:

o    (a)	The last business day of each Plan Year.
o    (b)	The last business day of each calendar quarter during the Plan Year.
o    (c)	The last business day of each month during the Plan Year.
þ    (d)	The last business day of each payroll period during the Plan Year.
o    (e)	Each pay day as reported by the Employer.
o    (f)	Any business day on which Participant Deferrals are received by the Provider.
o    (g)	Other:

2.13 Effective Date:

o    (a)	This is a newly-established Plan, and the Effective Date of the Plan is                    .
þ    (b)	This is an amendment and restatement of a plan named Nonqualified Excess Plan of GM Offshore, Inc. with an effective date of April 1, 2001. The Effective Date of this amended and restated Plan is January 1, 2005 and has been further amended effective January 1, 2010. This is amendment number 3.

o    (i)	All amounts in Deferred Compensation Accounts shall be subject to the provisions of this amended and restated Plan.
þ    (ii)	Any Grandfathered Amounts shall be subject to the Plan rules in effect on October 3, 2004.

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2.20 Normal Retirement Age: The Normal Retirement Age of a Participant shall be:

þ    (a)	Age 65.
o    (b)	The later of age     or the     anniversary of the participation commencement date. The participation commencement date is the first day of the first Plan Year in which the Participant commenced participation in the Plan.
þ    (c)	Other: Early Retirement: Completion of 5 Years of Service and atttainment of age 55.

2.23 Participating Employer(s): As of the Effective Date, the following Participating Employer(s) are parties to the Plan:

Name of Employer	Address	Telephone No.	EIN
GM Offshore, Inc.	10111 Richmond Avenue, Suite 340 Houton, TX 77006	(713) 963-9522 ext. 71396	76-0557179

2.26	Plan: The name of the Plan is Nonqualified Excess Plan of GM Offshore, Inc..
2.28	Plan Year: The Plan Year shall end each year on the last day of the month of December.
2.30	Seniority Date: The date on which a Participant has:

o    (a)	Attained age     .
o    (b)	Completed       Years of Service from First Date of Service.
þ    (c)	Attained age 55 and completed 5 Years of Service from First Date of Service.
o    (d)	Attained an age as elected by the Participant.
o    (e)	Not applicable — distribution elections for Separation from Service are not based on Seniority Date

4.1 Participant Deferral Credits: Subject to the limitations in Section 4.1 of the Plan, a Participant may elect to have his Compensation (as selected in Section 2.8 of this Adoption Agreement) deferred within the annual limits below by the following percentage or amount as designated in writing to the Committee:

þ    (a)     Base salary:

minimum deferral: 1%

maximum deferral: $_____ or 50%

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þ    (b)     Service Bonus:

minimum deferral: 10%

maximum deferral: $_____ or 100%

þ    (c)     Performance-Based Compensation:

minimum deferral: 10%

maximum deferral: $_____ or 100%

o    (d)     Commissions:

minimum deferral: _____%

maximum deferral: $_____ or _____%

o    (e)     Form 1099 Compensation:

minimum deferral: _____%

maximum deferral: $_____ or _____%

þ    (f)     Other: Director’s Fees:

minimum deferral: 5%

maximum deferral: $_____ or 100%

o    (g)     Participant deferrals not allowed.

4.2 Employer Credits: Employer Credits will be made in the following manner:

þ    (a)     Employer Discretionary Credits: The Employer may make discretionary credits to the Deferred Compensation Account of each Active Participant in an amount determined as follows:

o    (i)	An amount determined each Plan Year by the Employer.
þ    (ii)	Other: 100% of the first 71/2% of the Participant’s Compensation which is elected as a Salary Deferral Credit.

þ    (b)     Other Employer Credits: The Employer may make other credits to the Deferred Compensation Account of each Active Participant in an amount determined as follows:

þ    (i)	An amount determined each Plan Year by the Employer.
o    (ii)	Other:                    .

o    (c)     Employer Credits not allowed.

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5.2 Disability of a Participant:

þ    (a)	Participants may elect upon initial enrollment to have accounts distributed upon becoming Disabled.
o    (b)	Participants may not elect to have accounts distributed upon becoming Disabled.

5.3 Death of a Participant: If the Participant dies while in Service, the Employer shall pay a benefit to the Beneficiary in an amount equal to the vested balance in the Deferred Compensation Account of the Participant determined as of the date payments to the Beneficiary commence, plus:

o    (a)	An amount to be determined by the Committee.
o    (b)	Other:                    .
þ    (c)	No additional benefits.

5.4 In-Service or Education Distributions: In-Service and Education Accounts are permitted under the Plan:

þ    (a)     In-Service Accounts are allowed with respect to:

o  Participant Deferral Credits only.

o  Employer Credits only.

þ  Participant Deferral and Employer Credits.

In-service distributions may be made in the following manner:

þ  Single lump sum payment.

þ  Annual installments over a term certain not to exceed 5 years.

Education Accounts are allowed with respect to:

o  Participant Deferral Credits only.

o  Employer Credits only.

þ  Participant Deferral and Employer Credits.

Education Accounts distributions may be made in the following manner:

o  Single lump sum payment.

þ  Annual installments over a term certain not to exceed 6 years.

If applicable, amounts not vested at the time payments due under this Section cease will be: See Exhibit B

o  Forfeited.

þ  Distributed at Separation from Service if vested at that time.

o    (b)     No In-Service or Education Distributions permitted.

5.5 Change in Control Event:

þ    (a)	Participants may elect upon initial enrollment to have accounts distributed upon a Change in Control Event.
o    (b)	Participants may not elect to have accounts distributed upon a Change in Control Event.

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5.6	Unforeseeable Emergency Event:
	þ	(a)	Participants may apply to have accounts distributed upon an Unforeseeable Emergency event.
	o	(b)	Participants may not apply to have accounts distributed upon a Unforeseeable Emergency event.
6.	Vesting: An Active Participant shall be fully vested in the Employer Credits made to the Deferred Compensation Account upon the first to occur of the following events:
	þ	(a)	Normal Retirement Age.
	þ	(b)	Death.
	þ	(c)	Disability.
	þ	(d)	Change in Control Event.
	o	(e)	Other:                     .
	þ	(f)	Satisfaction of the vesting requirement as specified below:
		þ	Employer Discretionary Credits:
			o	(i)	Immediate 100% vesting.
			o	(ii)	100% vesting after ___ Years of Service.
			o	(iii)	100% vesting at age ___.

þ	(iv)	Number of Years		Vested
		of Service		Percentage
		Less than	1		0	%
			1		20	%
			2		40	%
			3		60	%
			4		80	%
			5		100	%
			6		___	%
			7		___	%
			8		___	%
			9		___	%
			10 or more		___	%

For this purpose, Years of Service of a Participant shall be calculated from the date designated below:
þ	(1	)	First Day of Service.
o	(2	)	Effective Date of Plan Participation.

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	o	(3	)	Each Crediting Date. Under this option (3), each Employer Credit shall vest based on the Years of Service of a Participant from the Crediting Date on which each Employer Discretionary Credit is made to his or her Deferred Compensation Account.
þ	Other Employer Credits:
	o	(i)		Immediate 100% vesting.
	o	(ii)		100% vesting after ___Years of Service.
	o	(iii)		100% vesting at age ___.

þ	(iv)	Number of Years		Vested
		of Service		Percentage
		Less than	1		0	%
			1		20	%
			2		40	%
			3		60	%
			4		80	%
			5		100	%
			6		___	%
			7		___	%
			8		___	%
			9		___	%
			10 or more		___	%

For this purpose, Years of Service of a Participant shall be calculated from the date designated below:
þ	(1	)	First Day of Service.
o	(2	)	Effective Date of Plan Participation.
o	(3	)	Each Crediting Date. Under this option (3), each Employer Credit shall vest based on the Years of Service of a Participant from the Crediting Date on which each Employer Discretionary Credit is made to his or her Deferred Compensation Account.

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7.1	Payment Options: Any benefit payable under the Plan upon a permitted Qualifying Distribution Event may be made to the Participant or his Beneficiary (as applicable) in any of the following payment forms, as selected by the Participant in the Participation Agreement:
	(a)	Separation from Service prior to Seniority Date, or Separation from Service if Seniority Date is Not Applicable
		þ	(i)	A lump sum.
		o	(ii)	Annual installments over a term certain as elected by the Participant not to exceed __ years.
		o	(iii)	Other:                     .
	(b)	Separation from Service on or After Seniority Date, If Applicable
		þ	(i)	A lump sum.
		þ	(ii)	Annual installments over a term certain as elected by the Participant not to exceed 10 years.
		o	(iii)	Other:                     .
	(c)	Separation from Service Upon a Change in Control Event
		þ	(i)	A lump sum.
		þ	(ii)	Annual installments over a term certain as elected by the Participant not to exceed 10 years.
		o	(iii)	Other:                     .
	(d)	Death
		þ	(i)	A lump sum.
		þ	(ii)	Annual installments over a term certain as elected by the Participant not to exceed 10 years.
		o	(iii)	Other:                     .
	(e)	Disability
		þ	(i)	A lump sum.
		þ	(ii)	Annual installments over a term certain as elected by the Participant not to exceed 10 years.
		o	(iii)	Other:                     .
		If applicable, amounts not vested at the time payments due under this Section cease will be:
		o	Forfeited

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o Distributed at Separation from Service if vested at that time

(f) Change in Control Event

þ	(i)	A lump sum.
o	(ii)	Annual installments over a term certain as elected by the Participant not to exceed years.
o	(iii)	Other:                                          .
o	(iv)	Not applicable.

If applicable, amounts not vested at the time payments due under this Section cease will be:

o Forfeited

o Distributed at Separation from Service if vested at that time

7.4 De Minimis Amounts.

o	(a)	Notwithstanding any payment election made by the Participant, the vested balance in the Deferred Compensation Account of the Participant will be distributed in a single lump sum payment at the time designated under the Plan if at the time of a permitted Qualifying Distribution Event that is either a Separation from Service, death, Disability (if applicable) or Change in Control Event (if applicable) the vested balance does not exceed $ . In addition, the Employer may distribute a Participant’s vested balance at any time if the balance does not exceed the limit in Section 402(g)(1)(B) of the Code and results in the termination of the Participant’s entire interest in the Plan
þ	(b)	There shall be no pre-determined de minimis amount under the Plan; however, the Employer may distribute a Participant’s vested balance at any time if the balance does not exceed the limit in Section 402(g)(1)(B) of the Code and results in the termination of the Participant’s entire interest in the Plan.

10.1 Contractual Liability: Liability for payments under the Plan shall be the responsibility of the:

þ	(a)	Company.
o	(b)	Employer or Participating Employer who employed the Participant when amounts were deferred.

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14.	Amendment and Termination of Plan: Notwithstanding any provision in this Adoption Agreement or the Plan to the contrary, Section 7.1of the Plan shall be amended to read as provided in attached Exhibit A.
	Section 5.1 of the Plan shall be amended as provided in Exhibit B.

o There are no amendments to the Plan.

17.9	Construction: The provisions of the Plan shall be construed and enforced according to the laws of the State of Texas, except to the extent that such laws are superseded by ERISA and the applicable provisions of the Code.
	IN WITNESS WHEREOF, this Agreement has been executed as of the day and year stated below.

GM Offshore, Inc.

Name of Employer

By: /s/ Quintin V. Kneen Authorized Person

Date:                                         

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EXHIBIT A

Section 7.1 Payment Options. The portion which is invested in Gulfmark common stock is to be paid out in Gulfmark stock.

EXHIBIT B

Section 5.4 In-Service or Education Distributions — Effective January 1, 2010 this Section 5.4 is amended to read as follows:

If applicable, amounts not vested at the time payments due under this Section cease will be:
o	Forfeited.
þ	Distributed at Separation from Service if vested at that time.

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EX-10.3

Exhibit 10.3

Form 1 The Nonqualified Plan Participation Agreement Step 1 Participant Information and Acceptance of the PlanNonqualified Plan Participation Agreement This Nonqualified Plan Participation Agreement (Agreement) is entered into by and between GM Offshore, Inc., having its principal place of business at 10111 Richmond Avenue, Suite 340, Houston, TX 77042 (hereinafter the Employer) and First Name M.I. Last NameSocial Security Number Date of Birth (hereinafter the Participant) The Employer has previously adopted Nonqualified Excess Plan of GM Offshore, Inc. (hereinafter the Plan) primarily for the purpose of providing deferred compensation benefits for a select group of management or highly compensated participants. The Participant, in recognition of his/her valuable service to the Employer, has been selected by the Committee as an eligible participant in the Plan. In consideration of the mutual covenants and conditions contained herein, and for such good and valuable consideration, the receipt and adequacy of which is hereby admitted and acknowledged, the parties hereto agree as follows:

Step 2 Deferral Election ?I elect to receive Employer Credits but do not elect to defer any additional compensation. OR Please complete the appropriate boxes below Percentage from each Paycheck or Payroll No Deferral (check the box) Deferral of Base Salary: (Minimum 1% / Maximum 50% ) % Deferral of Service Bonus: (Minimum 10% / Maximum 100% ) % Deferral of Performance-Based Compensation: (Minimum 10% / Maximum 100% ) % Deferral of Director’s Fees: (Minimum 5% / Maximum 100% ) % Participant Name (Please Print)

Step 3 Account Set Up Select one of the two options below to set up the account: If no selection is made, the entire account will be allocated as specified below ? Allocate both OR ? Allocate 100% Participant Deferrals andof the Employer Credits to the Employer Credits as specifiedRetirement Account and below. Please check your plan’sParticipant Deferrals as vesting requirements beforespecified below. selecting this option. Retirement Account% In-Service Account(s) (Distribution date must be at least 2 years after the account is established) Choose either lump sum payment or number of years to receive annual payments: (Maximum 5 years) New Account: % / / to be paid as: ? Lump sum ? Annual installments for years (Date payout begins) Existing Account: % / / to be paid as: ? Lump sum ? Annual installments for years (Date payout begins) Education Account(s) (Distribution date must be at least 2 years after the account is established) Choose number of years to receive annual payments: (Maximum 6 years) % / / years (Name of Student) (Date payout begins) % / / years (Name of Student) (Date payout begins) % / / years (Name of Student) (Date payout begins) % / / years (Name of Student) (Date payout begins) 100% * * If incomplete, allocation will default to 100% Retirement Account. ** If your allocation is directed to an In-Service or Education Account scheduled for distribution in a calendar year in which contributions are made, that portion of your allocation will default to the Retirement Account.

Step 4 – Acknowledgement of Plan Provisions Acknowledgements: The Participant hereby acknowledges the following: The obligation of the Employer to make payments under the Plan and the Agreement is a contractual liability of the Employer to the Participant. Such payments shall be made from the general funds of the Employer, and the Employer shall not be required to establish or maintain any special or separate fund, or otherwise to segregate assets to make the payment. The Participant shall not have any interest in any particular assets of the Employer by reason of the Employer’s obligation under the Plan and this Agreement. To the extent that the Participant or any other person acquires a right to receive payments under the Plan and this Agreement, such rights shall be no greater than the right of an unsecured creditor of the Employer. This Agreement shall continue in effect, unless modified or revoked in writing, until the earlier of the date on which the Participant terminates his or her services to the Employer or the date on which the Participant ceases to be an active participant in the Plan. Deferrals and Employer Credits shall be credited according to the allocation and distribution election in effect at the time the deferral is credited to the Deferred Compensation Account. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, This Agreement has been executed by and on behalf of the parties hereto as of the date first written below. Signature of Participant Participant Name (Please Print) Date Committee Approval Signature of Committee (Individual Authorized to Act on Behalf of Committee) Title of Individual Authorized to Act on Behalf of Committee            Participant’s Plan Participation Date Participant’s Date of Hire / / / /

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Bruce A. Streeter, certify that:

1.    I have reviewed this quarterly report on Form 10-Q for the quarterly period ended September 30, 2010 of GulfMark Offshore, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:	/s/ Bruce A. Streeter
	Bruce A. Streeter
	President and Chief Executive Officer

Date: October 27, 2010

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Quintin V. Kneen, certify that:

1.    I have reviewed this quarterly report on Form 10-Q for the quarterly period ended September 30, 2010 of GulfMark Offshore, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By:	/s/ Quintin V. Kneen
	Quintin V. Kneen
	Executive Vice President and Chief Financial Officer

Date: October 27, 2010

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

      In connection with the Quarterly Report of GulfMark Offshore, Inc. (the “Company”) on Form 10-Q for the quarterly period ended September 30, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Bruce A. Streeter, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)   The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Bruce A. Streeter
	Bruce A. Streeter
	President and Chief Executive Officer

Date: October 27, 2010

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

      In connection with the Quarterly Report of GulfMark Offshore, Inc. (the “Company”) on Form 10-Q for the quarterly period ended September 30, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Quintin V. Kneen, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)   The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Quintin V. Kneen
	Quintin V. Kneen
	Executive Vice President and Chief Financial Officer

Date: October 27, 2010