EX-10.1



 Exhibit 10.1 

PENN VIRGINIA CORPORATION 

AMENDED AND RESTATED ANNUAL INCENTIVE CASH BONUS AND 

LONG-TERM EQUITY COMPENSATION GUIDELINES 
  

	1.	Purpose of the Guidelines. 

 The purpose of the Guidelines is to provide annual and
long-term incentive frameworks that are performance driven and focused on corporate and individual quantitative and qualitative objectives that are critical to the Company’s success. 

 

	2.	Definitions. 

 The following terms used herein shall have the following meanings: 

(a) “Board” means the Board of Directors of the Company. 

(b) “BOE” means barrel of oil equivalent. 

(c) “Budget” means the Company’s annual budget for the applicable Plan Year, as approved by the Board. 

(d) “Cash Bonus Award” means an incentive cash bonus award granted to a Participant pursuant to the Guidelines that is paid
in a lump sum cash payment. 
 (e) “Cash Bonus Percentages” shall mean those cash bonus award percentages described on
Exhibit A under the heading “Cash Bonus Percentages – Executive Officers – Percent of Base Salary.” 
 (f)
“Cash Bonus Pool” means that amount of cash actually available for Cash Bonus Awards in any given Plan Year, as determined in accordance with Section 3 of the Guidelines. 

(g) “Cash Bonus Pool Target” means, with respect to any given Plan Year, the total amount of cash that would be payable as
Cash Bonus Awards with respect to such Plan Year to all Participants if each Participant received his or her Target Cash Bonus. 
 (h)
“Cash Costs per BOE” means, with respect to any given Plan Year, (x) the sum of the Company’s cash lease operating, gathering, processing and transportation expenses, production and ad valorem taxes and general and
administrative expenses during such Plan Year as set forth in the Financial Statements divided by (y) the Company’s total Production during such Plan Year measured in BOE. 

(i) “CEO” means the Company’s Chief Executive Officer. 

(j) “Committee” means the Compensation and Benefits Committee of the Board. 

(k) “Company” means Penn Virginia Corporation and its subsidiaries. 







 (l) “Company Performance Measures” means, with respect to Plan Year 2014,
Leverage Ratio, Production, Reserves, Drilling F&D costs per BOE and Cash Costs per BOE. The Committee shall, by resolution, determine the Company Performance Measures for each Plan Year after 2014. 

(m) “Credit Agreement” means the Company’s Credit Agreement dated September 28, 2012, as amended, restated or
replaced. 
 (n) “Drilling F&D Costs per BOE” means (x) the sum of the Company’s drilling and completion
capital costs related to all wells completed or identified as dry holes during such Plan Year, including any capital costs incurred in any previous Plan Year related to the drilling of, or otherwise in connection with, such wells, divided by
(y) the Company’s proved reserves developed as a result of such wells measured in BOE by the Company’s independent third party engineering firm. 

(o) “EBITDAX” shall have the meaning assigned to such term in the Company’s Credit Agreement. 

(p) “Employee Stock Incentive Plan” means the Company’s 2013 Amended and Restated Long-Term Incentive Plan, as
amended, restated or replaced. 
 (q) “Executive Officer” means the Company’s CEO, Chief Financial Officer, Chief
Operating Officer and Chief Administrative Officer and any other officers which the Committee may, by resolution, identify as an Executive Officer. 

(r) “Financial Statements” means the Company’s audited financial statements as of and for the year ended
December 31st of the applicable Plan Year. 
 (s) “Guidelines”
means these Amended and Restated Annual Incentive Cash Bonus and Long-Term Equity Compensation Guidelines. 
 (t) “Individual
Performance Measures” means those objective and subjective corporate and individual measures that (i) the CEO considers in recommending to the Committee, and that the Committee uses to determine, the Cash Bonus Award and Long-Term
Equity Compensation Award of each Executive Officer other than the CEO, (ii) the Committee considers in determining the Cash Bonus Award and Long-Term Equity Compensation Award of the CEO and (iii) the CEO considers in approving Cash Bonus
Awards and Long-Term Equity Compensation Awards of Participants other than the Executive Officers. 
 (u) “Leverage Ratio”
means the ratio of Total Debt as of the end of a Plan Year to EBITDAX for such Plan Year. 
 (v) “Long-Term Equity Compensation
Award” means an incentive equity award determined to be granted to a Participant pursuant to the Guidelines that is denominated in a dollar amount and that is paid out in the form of an award under the Employee Stock Incentive Plan. 

  
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 (w) “Participant” means any employee of the Company who was employed by the
Company on December 31st of the Plan Year with respect to whom a Cash Bonus Award or Long-Term Equity Compensation Award is paid. 

(x) “Performance Level Percentages” means, with regard to Plan Year 2014, the performance level percentages set forth on
Exhibit B under the heading “Performance Level Percentages.” The Committee shall, by resolution, determine Performance Level Percentages for each Plan Year after 2014. 

(y) “Plan Year” means the Company’s fiscal year. 

(z) “Production” means the Company’s net production for the applicable Plan Year as set forth in the Financial
Statements. 
 (aa) “Reserves” means the Company’s proved reserves on December 31st of the applicable Plan Year as set forth in the official report prepared by the Company’s independent petroleum engineers for such Plan Year. 

(bb) “Target Cash Bonus” means, with respect to any Participant, the product of (x) such Participant’s base salary
on December 31st of the Plan Year with respect to which a Cash Bonus Award is being considered times (y) such Participant’s Target Cash Bonus Percentage times (z) a fraction,
the numerator of which is the number of days that the Participant was employed by the Company during such Plan Year and the denominator of which is 365. 

(cc) “Target Cash Bonus Percentage” means, with respect to Executive Officers, those percentages described on Exhibit A
under the heading “Cash Bonus Percentages – Executive Officers – Percent of Base Salary – Target” and, with respect to Participants other than Executive Officers, the target percentages for such Participants determined as
described on Exhibit A. 
 (dd) “Target Equity Incentive Percentage” means, with respect to Executive Officers, those
percentages described on Exhibit A under the heading “Equity Incentive Percentages – Executive Officers – Target Percent of Base Salary” and, with respect to Participants other than Executive Officers, the target percentages for
such Participants determined as described on Exhibit A. 
 (ee) “Total Debt” has the meaning assigned to such term in the
Credit Agreement. 
 (ff) “Weighting Factor” means the weighting percentage assigned to each Company Performance Measure as
described on Exhibit B under the heading “Quantitative Performance Measures and Weighting Factors – Weighting Factors.” 
  

	3.	Calculation of Cash Bonus Pool. 

 The amount of the Cash Bonus Pool available to pay Cash
Bonus Awards with respect to each Plan Year shall be that amount equal to the product of (x) the Cash Bonus Pool Target times (y) the sum of the products of (A) the Performance Level Percentage attained for each Company Performance
Measure times (B) the Weighting Factor for such Company Performance Measure. 

  
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The Committee shall have the discretion to increase or decrease the Cash Bonus Pool by 15%. The Committee shall have the discretion to delete, add or change any Performance Measure or the
Weighting Factor of any Performance Measure at any time or from time to time for any Plan Year. 
  

	4.	Determination of Cash Bonus Awards and Long-Term Equity Compensation Awards. 

 (a)
Individual Performance Measures. Prior to March 1st of each Plan Year: 

(i) The CEO shall recommend to the Committee Individual Performance Measures for each Executive Officer other than the CEO; 

(ii) The Committee shall approve Individual Performance Measures for each Executive Officer, including the CEO, and the CEO shall advise each
other Executive Officer of his or her Individual Performance Measures; and 
 (iii) Each Executive Officer other than the CEO shall
recommend to the CEO Individual Performance Measures for each Participant who reports directly to such Executive Officer, the CEO shall approve Individual Performance Measures for such Participants and each Executive Officer shall advise such
Participant of his or her Individual Performance Measures. 
 Individual Performance Measures for Participants other than the Executive Officers and the
Participants reporting directly to the Executive Officers shall be determined by the CEO or the other Executive Officers if and as they deem necessary. Individual Performance Measures may be weighted to indicate relative importance. The Committee
may delete, add or change any Individual Performance Measure or the relative importance of any Individual Performance Measure applicable to any Executive Officer at any time or from time to time for any Plan Year, and the CEO may take the same such
actions with respect to the Individual Performance Measures of any other Participant. 
 (b) Cash Bonus Awards. Prior to March 1st of each Plan Year: 
 (i) The CEO shall recommend to the Committee a Cash Bonus Award for
each Executive Officer with respect to the immediately preceding Plan Year, which recommendation shall be based on (A) the size of the Cash Bonus Pool available, (B) such Executive Officer’s Threshold, Target and Stretch Cash Bonus
Percentages as described on Exhibit A, (C) whether such Executive Officer met, exceeded or did not meet his or her Individual Performance Measures set for such immediately preceding Plan Year, (D) peer comparison data and
(E) such other appropriate criteria as the CEO shall determine; 
 (ii) The Committee shall set the Cash Bonus Award for each Executive
Officer, including the CEO, using the same criteria described in subsection (b)(i); and 
 (iii) After receiving recommendations from the
other Executive Officers, as appropriate, the CEO shall approve all Cash Bonus Awards to be paid to Participants other than the Executive Officers and shall advise the Committee of the total amount of such Cash Bonus Awards. 

  
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 All Cash Bonus Awards, if any, shall be paid by not later than March 15th of each Plan Year with respect to the immediately preceding Plan Year and, subject to the Committee’s discretion to increase the Cash Bonus Pool by 15%, shall not, in the aggregate, exceed the
Cash Bonus Pool. 
 (c) Long-Term Equity Compensation Awards. Prior to
March 1st of each Plan Year: 
 (i) The CEO shall recommend to the Committee a
Long-Term Equity Compensation Award for each Executive Officer with respect to the immediately preceding Plan Year, which recommendation shall be based on (A) such Executive Officer’s Target Equity Incentive Percentage, (B) whether
such Executive Officer met, exceeded or did not meet his or her Individual Performance Measures set for such immediately preceding Plan Year, (C) the relative importance to the success of the Company’s execution of its strategic objectives
of retaining and incentivizing the Executive Officer beyond the current Plan Year, (D) peer comparison data and (E) such other appropriate criteria as the CEO shall determine; 

(ii) The Committee shall set the Long-Term Equity Compensation Award for each Executive Officer, including the CEO, using the same criteria
described in subsection (c)(i); and 
 (iii) After receiving recommendations from the other Executive Officers, as appropriate, the CEO
shall approve the Long-Term Equity Compensation Award to be considered by the Committee to be paid to each Participant other than Executive Officers and shall advise the Committee of the amounts of such awards. All Long-Term Equity Compensation
Awards shall be paid out in the form of an award approved by the Committee under the Employee Stock Incentive Plan. 
  

	5.	Interpretation; Amendments. 

 The Committee shall have the power to interpret the
Guidelines and to make and amend rules for putting it into effect and administering it. To the extent applicable, grants under the Guidelines shall be structured either to be exempt from or to comply with the requirements of section 409A of the
Code. The provisions of the Guidelines shall be interpreted and applied insofar as possible to carry out such intent. The Guidelines may be amended at any time or from time to time by the Board or the Committee. 

 

	6.	Governing Law. 

 The validity, construction and effect of the Guidelines and any rules or
regulations relating to the Guidelines shall be determined in accordance with the laws of the Commonwealth of Pennsylvania without regard to its conflict of laws principles. 
  

	7.	Effective Date and Term of Guidelines. 

 The Guidelines became effective on
February 23, 2011 and shall remain in effect until terminated by the Board. The Guidelines were last amended February 12, 2014. 

  
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 EXHIBIT A 

CASH BONUS PERCENTAGES 
 Executive
Officers 
  

											
	 	  	Percent of Base Salary	 
	 Officer
	  	Threshold	  	Target	 	  	Stretch	 
	 CEO
	  	0 – 50	  	 	100	  	  	 	200	  
	 COO
	  	0 – 50	  	 	90	  	  	 	180	  
	 CAO/GC
	  	0 – 40	  	 	80	  	  	 	160	  
	 CFO
	  	0 – 40	  	 	80	  	  	 	160	  
	 Sr. VP
	  	0 – 40	  	 	80	  	  	 	160	  

 Other Employees 

Prior to March 1st of each Plan Year, the CEO shall approve and advise the Committee of the Target
Cash Bonus Percentages for each Participant other than the Executive Officers. Such percentages shall be subject to increase or decrease in the event of a promotion or demotion. 

EQUITY INCENTIVE PERCENTAGES 

Executive Officers 
  

			
	 Officer
	  	Target Percent of Base Salary
	 CEO
	  	300 – 600
	 COO
	  	200 – 400
	 CAO/GC
	  	200 – 400
	 CFO
	  	200 – 400
	 Sr. VP
	  	200 – 400

 Other Employees 

Prior to March 1st of each Plan Year, the CEO shall approve and advise the Committee of the Target
Equity Incentive Percentages for each Participant other than the Executive Officers. Such percentages shall be subject to increase or decrease in the event of a promotion or demotion. 

  
 A-1 








 EXHIBIT B 

2014 QUANTITATIVE PERFORMANCE MEASURES AND WEIGHTING FACTORS 
  

											
	 Performance Measure
	  	Weighting
Factor	 	 	 Level of Attainment*
	  	Performance Level
Percentages	 
				
	 Production
	  	 	25	% 	 	111% of Budget	  	 	200	% 
		  				 	110% of Budget	  	 	185	% 
		  				 	109% of Budget	  	 	175	% 
		  				 	108% of Budget	  	 	170	% 
		  				 	107% of Budget	  	 	160	% 
		  				 	106% of Budget	  	 	145	% 
		  				 	105% of Budget	  	 	140	% 
		  				 	104% of Budget	  	 	135	% 
		  				 	103% of Budget	  	 	130	% 
		  				 	102% of Budget	  	 	115	% 
		  				 	99% – 101% of Budget	  	 	100	% 
		  				 	98% of Budget	  	 	95	% 
		  				 	97% of Budget	  	 	90	% 
		  				 	96% of Budget	  	 	85	% 
		  				 	95% of Budget	  	 	80	% 
		  				 	94% of Budget	  	 	75	% 
		  				 	93% of Budget	  	 	70	% 
		  				 	92% of Budget	  	 	55	% 
		  				 	90% – 91% of Budget	  	 	50	% 
				
	 Drilling F&D Costs per BOE
	  	 	25	% 	 	85% of Budget	  	 	200	% 
		  				 	86% of Budget	  	 	190	% 
	 Cash Costs Per BOE
	  	 	25	% 	 	87% of Budget	  	 	180	% 
		  				 	88% of Budget	  	 	175	% 
		  				 	89% of Budget	  	 	170	% 
	  				 	90% of Budget	  	 	165	% 
		  				 	91% of Budget	  	 	160	% 
		  				 	92% of Budget	  	 	155	% 
		  				 	93% of Budget	  	 	150	% 
		  				 	94% of Budget	  	 	142.5	% 
		  				 	95% of Budget	  	 	135	% 
		  				 	96% of Budget	  	 	125	% 
		  				 	97% of Budget	  	 	117.5	% 
		  				 	98% of Budget	  	 	110	% 
		  				 	99% – 101% of Budget	  	 	100	% 
		  				 	102% of Budget	  	 	97.5	% 
		  				 	103% of Budget	  	 	95	% 
		  				 	104% of Budget	  	 	90	% 
		  				 	105% – 106% of Budget	  	 	87.5	% 
		  				 	107% of Budget	  	 	85	% 
		  				 	108% of Budget	  	 	80	% 
		  				 	109% – 110% of Budget	  	 	77.5	% 
		  				 	111% of Budget	  	 	75	% 
		  				 	112% – 113% of Budget	  	 	70	% 
		  				 	114% of Budget	  	 	65	% 
		  				 	115% of Budget	  	 	57.5	% 
		  				 	116% of Budget	  	 	55	% 
		  				 	117% – 119% of Budget	  	 	50	% 


  
 B-1 









											
	 Leverage Ratio
	  	 	25	% 	 	80% of Budget	  	 	200	% 
		  				 	81% of Budget	  	 	185	% 
		  				 	82% of Budget	  	 	180	% 
		  				 	83% of Budget	  	 	175	% 
		  				 	84% of Budget	  	 	170	% 
		  				 	85% of Budget	  	 	165	% 
		  				 	86% – 87% of Budget	  	 	155	% 
		  				 	88% of Budget	  	 	150	% 
		  				 	89% of Budget	  	 	145	% 
		  				 	90% of Budget	  	 	140	% 
		  				 	91% of Budget	  	 	135	% 
		  				 	92% of Budget	  	 	130	% 
		  				 	93% – 94% of Budget	  	 	125	% 
		  				 	95% of Budget	  	 	120	% 
		  				 	96% of Budget	  	 	102.5	% 
		  				 	97% – 103% of Budget	  	 	100	% 
		  				 	104% of Budget	  	 	97.5	% 
		  				 	105% of Budget	  	 	95	% 
		  				 	106% – 107% of Budget	  	 	90	% 
		  				 	108% of Budget	  	 	85	% 
		  				 	109% of Budget	  	 	80	% 
		  				 	110% – 111% of Budget	  	 	75	% 
		  				 	112% of Budget	  	 	70	% 
		  				 	113% of Budget	  	 	65	% 
		  				 	114% – 115% of Budget	  	 	60	% 
		  				 	116% – 117% of Budget	  	 	55	% 
		  				 	118% – 120% of Budget	  	 	50	% 

  

	*	Levels of attainment falling between percentages will be rounded up (0.5 and over) or down (under 0.5), as appropriate 


  
 B-2