Exhibit 10.5

Execution Copy

2008 STIC Plan

The following sets forth the performance conditions and measures as approved by
the Compensation Committee on February 19, 2008 for the 2008 annual bonus awards
authorized under the CONSOL Energy Inc. Equity Incentive Plan: test

 

Eligibility    All Section 16 Officers (using the opportunity percentages as
approved by the Compensation Committee on January 23, 2008, and with respect to
Brett Harvey, as approved by the Compensation Committee on January 23, 2008 and
ratified by the independent members of the Board on February 19, 2008)
Performance Period    January 1, 2008 through December 31, 2008

Performance

Measures/Conditions

(for Maximum

Funding)

  

Subject to Compensation Committee’s exercise of negative discretion, the Maximum
Annual Award shall be earned if any one or more of the performance goals are
achieved:1

 

(i) Total Shareholder Return relative to the peer companies2 equals or is
greater than the 50th percentile as compared to peers for fiscal year 2008.

 

(ii) Annual EBITDA (i.e., earnings before deducting net interest expense
(interest expense less interest income), income taxes and depreciation,
depletion and amortization)3 for fiscal year 2008 equals or exceeds 50% of the
Compensation Committee-approved target EBITDA for 2008.

 

(iii) Annual Net Income2 for fiscal year 2008 equals or exceeds 50% of the
Compensation Committee-approved target Net Income for 2008.

 

The maximum funding for any individual will be:

 

  

Base Salary

(as of

December 31,

2008)

   ×   

Opportunity

Percentage

   ×    200%    =    Maximum Annual Award*    Note: Irrespective of the above
formula, the maximum annual award amount shall not exceed $2,000,000 for any
officer for fiscal year 2008.

 

1

Each as approved by (and in accordance with the procedures established by) the
Committee on February 19, 2008 and March 25, 2008 and on file with the
Compensation Committee, for the performance period of January 1, 2008 to
December 31, 2010.

2

See Attachment A for list of companies.

3

The Committee shall make adjustments to the EBITDA and Net Income calculations
for the following items: (i) the effect of changes in accounting principles;
(ii) expenses associated with reorganizations and/or restructuring programs,
including, but not limited to, reductions in force (pursuant to FASB 146) and
early retirement incentives; and (iii) impairment of intangible or intangible
assets pursuant to FAS 144.

 

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Negative Discretion    The Compensation Committee will exercise its negative
discretion to determine the actual annual cash bonus paid to each officer under
the following formula and guidelines:    Base Salary    ×   

Opportunity

Percentage

   ×   

Annual Incentive

Compensation Award Factor (“Award Factor”)

   =    Annual Award    The Compensation Committee will determine the Award
Factor of each officer as follows:     

Target

       

Weight

       

Performance Rating
Range

             CONSOL Performance Factor (Board-approved corporate P.O. Net
income)        1/2    ×    70 – 200%    +       Individual Objectives        1/2
   ×    70 – 200%    =    Award Factor4    Notwithstanding the foregoing, no
awards shall be paid in the event CONSOL does not achieve a minimum net income
threshold approved by the Compensation Committee for fiscal year 2008.

After the end of the Performance Period, the Committee shall certify in writing
the extent to which the applicable Performance Condition and any other material
terms of the awards have been achieved. For purposes of this provision, and for
so long as the Internal Revenue Code of 1986 permits, the approved minutes of
the Committee meeting in which the certification is made may be treated as
written certification.

Subject to the terms and conditions of the Plan, awards earned by a participant
will be paid the calendar year immediately following the end of the Performance
Period on a date determined in the Committee’s discretion, but in no event later
than March 15th of such calendar year.

IN WITNESS WHEREOF, the undersigned hereby certifies on the day and year
indicated below that the foregoing performance conditions and measures were
approved by the Compensation Committee of the Board of Directors on February 19,
2008.

 

Dated: March 28, 2008  

/s/ John Whitmire

  John Whitmire, Chairman, on behalf of the   Board of Directors Dated: March
28, 2008  

/s/ William Powell

  William Powell, Chairman, on behalf of the   Compensation Committee

 

4

In exercising its negative discretion, the Committee may make adjustments to
calculations for extraordinary, unusual, infrequent, unanticipated or
non-recurring items, and may take into account aggregate limits on compensation
payouts for all awards to the employees of the Company (e.g., not to exceed
$57.3 million for fiscal year 2008).

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Attachment A

Total Shareholder Return Peer Companies*

 

Alliance Resource Partners, L.P.    International Coal Group Inc. Alpha Natural
Resources, Inc.    James River Coal Company Anadarko Petroleum Corporation   
Massey Energy Company Apache Corporation    Newfield Exploration Company Arch
Coal Inc.    Nexen Inc. Cabot Oil & Gas Corporation    Noble Energy Inc. Callon
Petroleum Co/DE    Peabody Energy Corporation Chesapeake Energy Corporation   
Penn Virginia Corporation Cimarex Energy Co.    Pioneer Natural Resources
Company Comstock Resources Inc.    Rio Tinto Group (GBR) –ADR Denbury Resources
Inc.    St. Mary Land & Explor Company Devon Energy Corporation    Stone Energy
Corporation Encana Corporation    Ultra Petroleum Corporation EOG Resources,
Inc.    Westmoreland Coal Company Foundation Coal Holdings Inc.   

 

* The Houston Exploration Co. and the Pogo Producing Company used to be in the
Shareholder Return Peer Group, but they are no longer in existence, and
accordingly, are no longer in this group.