Exhibit 10.7(d)

 

CABOT OIL & GAS CORPORATION

HYBRID PERFORMANCE SHARE AWARD AGREEMENT

 

This Hybrid Performance Share Award Agreement (the “Agreement”), made and
entered into by and between Cabot Oil & Gas Corporation (the “Company”) with its
principal office at 840 Gessner Road, Suite 1400, Houston, Texas  77024 and [
Participant Name ], (the “Employee”), is dated as of  [ February 16, 2012 ].

 

This Agreement is expressly subject to the terms and provisions of the Company’s
2004 Incentive Plan (the “Plan”). In the event there is a conflict between the
terms of the Plan and this Agreement, the terms of the Plan shall control. All
undefined capitalized terms used herein that are not otherwise defined shall
have the meanings assigned to them in the Plan.

 

1.                                      Award.  As an additional incentive and
inducement to the Employee to remain in the employment of the Company, and to
devote his or her best efforts to the business and affairs of the Company, the
Company hereby awards to the Employee a Hybrid Performance Share Award of [
number of shares granted ] shares of Cabot Oil & Gas Corporation Common Stock,
par value $.10 per share, (the “Hybrid Performance Shares”) upon the terms and
conditions hereinafter set forth.  The date of such grant is [ February 16, 2012
] (“Date of Grant”).

 

2.                                      Terms of Award.  Subject to the terms
and provisions of this Agreement, the restrictions on the Hybrid Performance
Shares shall lapse (i) with respect to 33 1/3% of the total number of shares, as
of the first anniversary of the Date of Grant; and (ii) with respect to an
additional 33 1/3% of the total number of shares as of the second anniversary of
the Date of Grant; and (iii) with respect to the remaining 33 1/3% of the total
number of shares as of the third anniversary of the Date of Grant (each such
date a “Date of Lapse of Restrictions”), provided that with respect to each 33
1/3% portion, such restrictions shall lapse only if the Company shall have $100
million or more of operating cash flow in the fiscal year immediately preceding
such vesting date and only when the Committee has made a determination that such
result was achieved, as provided below in Section 3.  If the Company does not
have $100 million or more of operating cash flow in the fiscal year immediately
preceding a vesting date, the 33 1/3% of the Hybrid Performance Shares that
would have vested on such date will be forfeited.

 

3.                                      Certification.  No later than the
fifteenth business day following each Date of Lapse of Restrictions, the
Committee shall determine, in writing, the extent to which the performance
criteria have been met and the amount to be distributed with respect to the
Hybrid Performance Shares as provided in Section 2 hereof and the Company shall
issue to the Employee the appropriate number of shares of Common Stock.  The
Committee has sole and absolute authority and discretion to determine the amount
to be distributed with respect to the Hybrid Performance Shares.  The
determination of the Committee shall be binding and conclusive on the Employee. 
Notwithstanding anything in this Agreement to the contrary, the Employee shall
not be entitled to any Common Stock with respect to the Hybrid Performance
Shares unless and until the Committee determines and certifies the extent to
which the performance criteria have been met.

 

4.                                      Termination of Employment.  Except as
otherwise provided in this Section 4, Section 5 or Section 6, in the event the
Employee’s employment is terminated prior to the Date

 

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of Lapse of Restrictions, all then-unvested Hybrid Performance Shares shall
immediately be forfeited by the Employee.  In the case of the termination of
employment by reason of death, disability, or retirement, (under an approved
retirement plan) all Hybrid Performance Shares shall, to the extent not
previously vested, continue to vest on the original schedule with the level of
payout, if at all, dependent on performance in accordance with this Agreement. 
Notwithstanding the foregoing and in the case of a retirement, an Employee must
be an employee of the Company on September 30th of the year the award is granted
in order to continue vesting in the award.  Further, a Participant must be an
active employee of the Company at the time the Compensation Committee of the
Board of Directors certifies the results of the Hybrid Performance Shares for
employment termination other than death, disability or retirement.  In the case
of the termination of employment for any other reason, the Compensation
Committee may, in its sole discretion, accelerate the vesting of some or all
unvested Hybrid Performance Shares, upon such terms as the Compensation
Committee deems advisable.

 

5.                                      Confidential Information and
Non-Competition.  In consideration of (i) the Company disclosing and providing
access to Confidential Information, as more fully described in
Section 5(a) below, (ii) the grant by the Company of the Hybrid Performance
Shares to provide an economic incentive to Employee to use Employee’s best
efforts during his/her employment with the Company to advance the business and
goodwill of the Company and in order to protect the Company’s interests in its
Confidential Information and goodwill after the date hereof, and (iii) other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Employee, intending to be legally bound, hereby agrees as
follows:

 

(a)                                 Employee hereby covenants and agrees that at
all times during his or her employment with the Company and for a period of
twenty-nine (29) months after a termination of the Employee’s employment by
reason of retirement as provided in Section 4, he or she will not, without the
prior written consent of the Company’s chief legal officer, either directly or
indirectly, for himself/herself or on behalf of or in conjunction with any other
person, company, partnership, corporation or other entity, engage in any
activities prohibited in the following subsections (1) through (3) of this
Section 5(a):

 

(1)                                 Employee shall not assist or directly or
indirectly provide services, whether as a partner, employee, consultant,
officer, director, manager, agent, associate, investor, or otherwise, to any
person or entity which is at the time of such assistance or provision a
“Competitor” of the Company.  For purposes of this Section 5, the term
“Competitor” means any person or entity that is engaged in the exploration and
production of oil, gas or other hydrocarbons, the transportation thereof, any
other midstream activities or the provision of oilfield services in any state or
county/parish thereof in which the Company conducts business and/or has
established business plans to conduct business activities within the twelve
month period preceding Employee’s termination.

 

(2)                                 In order to assist Employee with his or her
duties, the Company shall continue to provide the Employee with access to
confidential and proprietary information and other confidential information
which is either information not

 

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known by actual or potential competitors, customers and third parties of the
Company or is proprietary information of the Company (“Confidential
Information”).  Such Confidential Information shall include all non-public
information the Employee acquired as a result of his or her positions with the
Company that might be of any value to a competitor of the Company.  Examples of
such Confidential Information include, without limitation, non-public
information about the Company’s customers, suppliers, and potential acquisition
targets; its business operations, structure and methods of operation; its
services and pricing; its processes, machines and inventions; it research and
know-how; its business planning and strategies; information maintained in its
computer systems; devices, processes, compilations of information and records;
and future business plans.  Employee agrees that such Confidential Information
remains confidential even if committed to the Employee’s memory.  Employee
agrees not to use, divulge, or furnish or make accessible to any third party,
company, corporation or other organization (including but not limited to
customers, competitors, or governmental agencies), without the Company’s prior
written consent, any Confidential Information of the Company, except as
necessary in performing his or her duties on behalf of the Company during his or
her employment with the Company.  The Employee’s obligations under this
Section will not apply to the extent that (i) the disclosure of Confidential
Information is required by applicable law; provided that, prior to disclosing
such Confidential Information, to the fullest extent practicable Employee must
notify the Company thereof, which notice will include the basis upon which
Employee believes the information is required to be disclosed, or
(ii) information otherwise determined to be Confidential Information is or
becomes generally available to the public or to persons generally knowledgeable
in the Company’s industry without violation of this Agreement by Employee.

 

(3)                                 Employee agrees that whenever the Employee’s
employment with the Company ends for any reason, (i) all documents containing or
referring to the Company’s Confidential Information as may be in the Employee’s
possession, or over which the Employee may have control, and all other property
of the Company provided to Employee by the Company during the course of
Employee’s employment with the Company will be returned to the Company
immediately, with no request being required; and (ii) all Company computer and
computer-related equipment and software, and all Company property, files,
records, documents, drawings, specifications, lists, equipment and similar items
relating to the business of the Company, whether prepared by the Employee or
otherwise, coming into the Employee’s possession or control during the course of
his or her employment shall remain the exclusive property of the Company, and
shall be delivered by the Employee to the Company immediately, with no request
being required.

 

(b)                                 Employee specifically recognizes and affirms
that each of the covenants contained in Section 5(a)(1) through (3) of this
Agreement is a material and important term of this Agreement which has induced
the Company to provide for the award of Hybrid Performance Shares granted
hereunder, the disclosure of the Confidential

 

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Information referenced herein, and the other promises made by the Company
herein, and the Employee further agrees that in the event that he or she retires
and thereafter (A) the Company determines that Employee has breached any term of
Section 5(a) (1) through (3) or (B) all or any part of Section 5(a) is held or
found invalid or unenforceable for any reason whatsoever by a court of competent
jurisdiction in any action between the Employee and the Company, in addition to
any other remedies at law or in equity the Company may have available to it, the
Employee shall lose the right to receive Hybrid Performance Shares and any
unvested Hybrid Performance Shares shall be deemed forfeited effective as of the
date (A) the Company determines that Employee has breached any term of
Section 5(a) or (B) all or any part of Section 5(a) is held or found invalid or
unenforceable for any reason whatsoever by a court of competent jurisdiction in
an action between the Employee and the Company.

 

(c)                                  The Employee and the Company agree that the
restrictions set forth in Section 5(a) are reasonable, including the geographic
area, duration as to time, and scope of activities restrained.  The Employee
further agrees that if any covenant contained in Section 5(a) is found by a
court of competent jurisdiction to contain limitations as to time, geographical
area, or scope of activity that are not reasonable and impose a greater
restraint than is necessary to protect the goodwill or other business interest
of the Company, then the court shall reform the covenant to the extent necessary
to cause the limitations contained in the covenant as to time, geographical
area, and scope of activity to be restrained to be reasonable and to impose a
restraint that is not greater than necessary to protect the goodwill and other
business interests of the Company and to enforce the covenants as reformed.

 

(d)                                 The covenants on the part of Employee in
this Section 5 are considered independent of any other agreement, and the fact
that the Employee has a claim against the Company, whether predicated upon this
Agreement or otherwise, is not a defense to enforcement of this Section 5.

 

6.                                      Change in Control.  In the event of a
Change in Control (as herein defined), any restriction periods and restrictions
imposed on the Hybrid Performance Shares subject to this Agreement shall lapse,
and on the fifteenth business day after the occurrence of a Change in Control
(as herein defined), the stock certificates representing the Hybrid Performance
Shares not previously delivered, without any restrictions or legend thereon,
shall be delivered to the Employee.

 

“Change in Control” shall mean:

 

(I)                                   The acquisition by any individual, entity
or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 35% or more of either (1) the then outstanding shares of common
stock of the Company (the “Outstanding Company Common Stock”) or (2) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”); provided, however, that for purposes of this

 

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subsection (I), the following acquisitions shall not constitute a Change of
Control: (i) any acquisition directly from the Company, (ii) any acquisition by
the Company, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any entity controlled by the
Company or (iv) any acquisition by any entity pursuant to a transaction which
complies with clauses (1), (2) and (3) of subsection (III) of this definition;
or

 

(II)                              Individuals who, as of the date hereof,
constitute the Board (the “Incumbent Board”) cease for any reason to constitute
at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

 

(III)                         Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a “Business Combination”), in each case, unless,
following such Business Combination, (1) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the entity resulting from such Business Combination (including,
without limitation, an entity that as a result of such transaction owns the
Company or all or substantially all of the Company’s assets either directly or
through one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the case may
be, (2) no Person (excluding any entity resulting from such Business Combination
or any employee benefit plan (or related trust) of the Company or such entity
resulting from such Business Combination) beneficially owns, directly or
indirectly, 35% or more of, respectively, the then outstanding shares of common
equity of the entity resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of such entity except to
the extent that such ownership existed prior to the Business Combination and
(3) at least a majority of the members of the board of directors of the
corporation, or the similar managing body of a non-corporate entity, resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or

 

(IV)                          Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company, other than a liquidation or
dissolution in connection with a transaction to which subsection (III) applies.

 

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Notwithstanding the foregoing, none of the events described in subsections
(I) through (IV) above shall constitute a Change in Control unless such event
also meets the requirements of Section 409A(a)(2)(A)(v) of the Internal Revenue
Code of 1986, as amended (the “Code”) and the related regulations and guidance.

 

7.                                      Employment.  This Agreement is not an
employment agreement. Nothing contained herein shall be construed as creating
any employment relationship other than one at will.

 

8.                                      Assignment.  This Agreement shall inure
to the benefit of and be binding upon the heirs, legatees, distributees,
executors and administrators of the Employee and the successors and assigns of
the Company.  In no event shall Hybrid Performance Shares granted hereunder be
voluntarily or involuntarily sold, pledged, assigned or transferred by the
Employee other than by will or the laws of descent and distribution or pursuant
to a qualified domestic relations order.

 

9.                                      Governing Law.  This Agreement shall be
governed by the laws of the State of Delaware, without giving effect to conflict
of law rules or principles.  Any action or proceeding seeking to enforce any
provision of or based on any right arising out of this Agreement may be brought
against the Employee or the Company only in the courts of the State of Delaware
or, if it has or can acquire jurisdiction, in the United States District Court
for the District of Delaware, and the Employee and the Company consent to the
jurisdiction of such courts (and of the appropriate appellate courts) in any
action or proceeding and waives any objection to venue laid herein.

 

10.                               Taxes.  Employee agrees that as a condition to
the award of the Hybrid Performance Shares hereby, that Employee shall pay to
the Company at the time or times requested by the Company, an amount of cash or
shares of Common Stock equal to the amount the Company is required by any
governmental authority to withhold for tax purposes with respect to any payment
of earned Hybrid Performance Shares, unless the Employee makes other prior
arrangements for such withholding as may be approved by the Company.

 

11.                               Shareholder Status.  The Employee shall have
no rights of a shareholder with respect to the shares of Common Stock
potentially deliverable pursuant to this Agreement unless and until such time as
the ownership of such shares of Common Stock has been transferred to the
Employee.

 

12.                               Controlling Agreement.  This Agreement shall
supersede and control over any other agreement between the Company and the
Employee, whether entered previously or entered subsequent to the date hereof,
related to Hybrid Performance Shares awarded hereunder.

 

13.                               Recapitalization.  In the event of any merger,
reorganization, consolidation, recapitalization, stock split, separation,
liquidation, stock dividend, split-up, share combination, or other change in the
corporate structure of the Company affecting the Hybrid Performance Shares, the
number of Hybrid Performance Shares subject to this Agreement shall be equitably
adjusted by the Compensation Committee to prevent dilution or enlargement of
rights.

 

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14.                               Miscellaneous.

 

(a)  This Agreement shall not confer upon the Employee any right to continuation
of employment by the Company; nor shall this Agreement interfere in any way with
the Company’s right to terminate his or her employment at any time.

 

(b)  With the approval of the Board of Directors, the Compensation Committee may
terminate, amend or modify the Plan; provided, however, that no such
termination, amendment or modification of the Plan may in any material way
adversely affect the Employee’s rights under this Agreement.

 

(c)  This Agreement shall be subject to all applicable laws, rules and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.

 

15.                               Section 409A Compliance.

 

The following provisions shall apply to this Agreement, notwithstanding any
provision to the contrary:

 

(a)         This Agreement is intended to comply with Section 409A of the Code
and ambiguous provisions, if any, shall be construed in a manner that is
compliant with or exempt from the application of Section 409A.

 

(b)         This Agreement shall not be amended in a manner that would cause the
Agreement or any amounts payable under the Agreement to fail to comply with the
requirements of Section 409A, to the extent applicable, and, further, the
provisions of any purported amendment that may reasonably be expected to result
in such non-compliance shall be of no force or effect with respect to the
Agreement.

 

(c)          The Company shall neither cause nor permit any payment, benefit or
consideration to be substituted for a benefit that is payable under this
Agreement if such action would result in the failure of any amount that is
subject to Section 409A to comply with the applicable requirements of
Section 409A.

 

(d)         The Company shall neither cause nor permit any adjustments to any
equity interest to be made in a manner that would result in the equity
interest’s becoming subject to Section 409A unless, after such adjustment, the
equity interest is in compliance with the requirements of Section 409A to the
extent applicable.

 

(e)          For purposes of Section 409A, each payment under this Agreement
shall be deemed to be a separate payment.

 

(f)           Notwithstanding any provision of this Plan to the contrary, if the
Employee is a “specified employee” within the meaning of Section 409A as of the
date of the termination of the Employee’s employment, then any amounts or
benefits which

 

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(i)                                     are payable under this Agreement upon
the upon the Employee’s “separation from service” within the meaning of
Section 409A,

 

(ii)                                  are subject to the provisions of
Section 409A,

 

(iii)                               are not otherwise excluded under
Section 409A, and

 

(iv)                              would otherwise be payable during the first
six-month period following such separation from service

 

shall be paid on the fifteenth business day next following the earlier of
(i) the expiration of six months from the date of the termination of the
Employee’s employment or (ii) the date of the Employee’s death.

 

IN WITNESS WHEREOF, the parties hereto cause this Agreement to be executed as of
the date hereof.

 

 

 

Company:

 

 

 

CABOT OIL & GAS CORPORATION

 

 

 

 

 

/s/   Scott C. Schroeder

 

By:

Scott C. Schroeder

 

Title:

Vice President, Chief Financial Officer

 

 

& Treasurer

 

 

 

 

 

 

 

Employee:

 

 

 

 

 

 

 

 

 

[ Participant Name ]

 

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