January 27, 2004

Mr.Steven Overly1215ChallengerAustin,Texas 78734

DearSteve:

Weare pleased to confirm our offer of employment to you as Vice President,General Counsel and Secretary of NUI Corporation ("NUI"). The purposeof this letter is to set forth our understanding of the terms of youremployment.
    - Your start date will be     February 1, 2004.
    - Your annual base salary     will be $250,000, payable in accordance with NUI's payroll practices. 
    - In the event of a Sale     of NUI (as hereinafter defined), NUI will pay to you an amount equal to     $250,000 provided that you have been continuously employed by NUI through     the date of such Sale of NUI (except as otherwise provided in paragraph 6     hereof). Such amount shall be paid to you in a lump-sum, in cash, promptly     following such Sale of NUI. For purposes of this letter agreement,     "Sale of NUI" means any transaction or series of related     transactions approved by the Board pursuant to which an unaffiliated third     party (or a group of unaffiliated third parties acting together) acquires     (a) common shares of NUI constituting a majority of the issued and     outstanding common shares of NUI (whether by merger, consolidation, sale     or transfer of NUI's outstanding interests or otherwise) or (b) all or     substantially all of NUI's consolidated assets.
    - As an NUI employee, you     will be eligible to participate in the employee benefit plans and programs     made available from time to time for NUI's other senior executive     officers;  provided, however,  that (a) you will not be eligible to     participate in any bonus or incentive compensation (including, without     limitation, any stock-based compensation) or severance plan, program or     policy of NUI, and (b) you will have the option not to participate in     NUI's employee medical, dental, vision and life insurance plans;  provided,     further, however,  that the cost that would otherwise be borne by NUI     to cover you and your dependents under any such plans in which you elect     not to participate shall be paid to you on a monthly basis in cash.     Without limiting the foregoing, while you are employed by NUI, NUI will     provide you with a personal computer and use of an automobile for use in     the performance of your duties on behalf of NUI, in each case, in     accordance with NUI's policies. During your employment with NUI, you will     be entitled to four weeks' paid vacation per year in accordance with NUI's     vacation policies. During your employment while you maintain a permanent     residence in Austin, Texas, NUI will pay or reimburse (A) reasonable     rental expenses incurred for temporary residential accommodations,     selected by NUI, for you in New Jersey, and (B) coach airfare incurred by     you for one round-trip per week between the New York/New Jersey     metropolitan area and Austin, Texas. Any such payments or reimbursements     shall be grossed up, if necessary, to cover any federal, state or other     taxes due with respect to such payments or reimbursements. 
    - NUI will indemnify you     for any liability you incur arising from your actions within the scope and     course of your employment with NUI or service as a director of NUI in     accordance with NUI's Amended and Restated Certificate of     Incorporation.  During your     employment with NUI and while potential liability exists thereafter, NUI     will maintain a directors' and officers' liability insurance policy     covering you in the same amount and to the same extent as NUI covers its     other officers and directors.
    - Your employment with     NUI is for no fixed term, and either you or NUI may terminate your     employment at any time for any reason or no reason upon at least one     hundred eighty days prior written notice to the other party; provided,     however, that no such notice shall be required upon termination of your     employment by NUI for Cause (as hereinafter defined). If NUI terminates     your employment prior to a Sale of NUI without Cause, and not because of     your death or incapacity due to physical or mental illness (as determined     in the good faith judgment of the Board), and a Sale of NUI occurs within     twelve months following such termination, you will be entitled to receive     the payment set forth in paragraph 3 here of promptly following such Sale     of NUI. Except as otherwise provided in this paragraph 6, you will not be     entitled to any severance, termination pay, salary continuation or similar     compensation or benefits upon or after termination of your employment with     NUI. "Cause" is defined as: (a) the commission of an act of     fraud, embezzlement, theft or dishonesty against NUI or any of its     subsidiaries or affiliates; (b) the willful engaging by you in conduct     which is demonstrably and materially injurious to NUI or its subsidiaries     or affiliates, monetarily or otherwise; (c) conviction of (or plea of  nolo     contendere  to) any crime involving moral turpitude or which subjects,     or if generally known would subject, NUI or any subsidiary or affiliate     thereof to public ridicule or embarrassment; or (d) the gross neglect or     willful failure to perform your duties and responsibilities hereunder or     to comply with the policies and procedures of NUI in all material respects,     if such neglect or failure is not cured within thirty days after written     notice thereof.
    - This letter agreement,     together with the agreements described in the last paragraph hereof,     constitutes the entire agreement between you and NUI with respect to the     subject matter hereof, supersedes any prior agreements and undertakings,     both written and oral, and may not be modified or amended in any way     except in writing by you and NUI. The validity, interpretation,     construction and performance of this letter agreement shall be governed by     the substantive laws of the State of New Jersey.   Any dispute or controversy arising under or in connection     with this letter agreement shall be settled exclusively by arbitration in the     State of New Jersey in accordance with the rules of the American     Arbitration Association then in effect, and judgment may be entered on the     arbitrator's award in any court of competent jurisdiction. All amounts     payable hereunder shall be subject to the withholding of all applicable     taxes and deductions required by any applicable law.

Pleaseunderstand that the terms and conditions of your employment by NUI are governedby standard company policies. Among other things, this means that uponcommencing employment with NUI, if requested by NUI, you agree to enter intocustomary confidential information, nonsolicitation, inventions and similaragreements. If you agree with the terms outlined in this letter agreement,please acknowledge the same by signing this letter agreement and the enclosedduplicate original hereof and returning such signed duplicate original copy inthe envelope provided.

Sincerely,NUI CORPORATION

By:  /S/ BERNARD S. LEEName: Bernard S. LeeTitle:    Chairman, Compensation Committee

Acceptedand Agreed to as of this 27 day of January 2004:

/S/  STEVENOVERLY