National Oilwell Varco 2012 Annual Report Download - page 86

Index to Financial Statements
Revolving Credit Facility
The Company has a $2 billion, five-year revolving credit facility which expires April 30, 2013. At December 31, 2011 there were no borrowings against the credit facility, and
there were $862 million in outstanding letters of credit issued under the credit facility, resulting in $1,138 million of funds available under this revolving credit facility.
Interest under this multicurrency facility is based upon LIBOR, NIBOR or EURIBOR plus 0.26% subject to a ratings-based grid, or the prime rate. The credit facility contains
a financial covenant regarding maximum debt to capitalization and the Company was in compliance at December 31, 2011.
The Company also had $1,863 million of additional outstanding letters of credit at December 31, 2011, primarily in Norway, that are under various bilateral committed letter
of credit facilities. Other letters of credit are issued as bid bonds and performance bonds.
10. Employee Benefit Plans
We have benefit plans covering substantially all of our employees. Defined-contribution benefit plans cover most of the U.S. and Canadian employees, and benefits are based
on years of service, a percentage of current earnings and matching of employee contributions. Employees in our Norwegian operations can elect to participate in a
defined-contribution plan in lieu of a local defined benefit plan. For the years ended December 31, 2011, 2010 and 2009, expenses for defined-contribution plans were
$54 million, $41 million, and $39 million, respectively, and all funding is current.
Certain retired or terminated employees of predecessor or acquired companies participate in a defined benefit plan in the United States. None of the participants in this plan
are eligible to accrue benefits. In addition, 1,053 U.S. retirees and spouses participate in defined benefit health care plans of predecessor or acquired companies that provide
postretirement medical and life insurance benefits. Active employees are ineligible to participate in any of these defined benefit plans. Our subsidiaries in the United Kingdom
and Norway also have defined benefit pension plans covering virtually all of their employees.
As a result of the Ameron acquisition in October of 2011, the Company acquired a qualified, defined benefit, noncontributory pension plan for certain U.S. employees as well
as the obligation to provide defined retirement benefits to eligible employees in the Netherlands. The U.S. plan at December 31, 2011 was closed to new participants not
covered by a collective bargaining agreement and ceased all benefit accruals under the plan with respect to employees that are not covered by a collective bargaining
agreement. In addition, 232 U.S. employees covered by a collective bargaining agreement participate in defined benefit health care plans that provide postretirement medical
benefits.
Net periodic benefit cost for our defined benefit plans aggregated $14 million, $10 million and $12 million for the years ended December 31, 2011, 2010 and 2009,
respectively.
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