Document:

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                                                                   Exhibit 10.3

                            EQUITABLE RESOURCES, INC.

                           DEFERRED COMPENSATION PLAN

                  AMENDED AND RESTATED EFFECTIVE MARCH 1, 2001

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                            EQUITABLE RESOURCES, INC.
                           DEFERRED COMPENSATION PLAN

                                Table of Contents
<TABLE>
<S>                                                                                      <C>
ARTICLE I..................................................................................5

   1.1   STATEMENT OF PURPOSE..............................................................5

ARTICLE II.................................................................................6

DEFINITIONS................................................................................6

   2.1   ACCOUNT...........................................................................6
   2.2   BASE SALARY.......................................................................6
   2.3   BENEFICIARY.......................................................................6
   2.4   BOARD.............................................................................6
   2.5   BONUS.............................................................................6
   2.6   CHANGE IN CONTROL.................................................................6
   2.7   CODE..............................................................................7
   2.8   COMMITTEE.........................................................................7
   2.9   COMPANY...........................................................................7
   2.10  COMPENSATION......................................................................7
   2.11  CREDITED SERVICE..................................................................7
   2.12  DEFERRAL ACCOUNT..................................................................7
   2.13  DEFERRAL AMOUNT...................................................................8
   2.14  DEFERRAL BENEFIT..................................................................8
   2.15  DEFERRAL ELECTION.................................................................8
   2.16  DISABILITY........................................................................8
   2.17  EARLY RETIREMENT..................................................................8
   2.18  ELIGIBLE EMPLOYEE.................................................................8
   2.19  ELECTIVE DEFERRAL AMOUNT..........................................................8
   2.20  EMPLOYER..........................................................................8
   2.21  HARDSHIP WITHDRAWAL...............................................................8
   2.22  INVESTMENT RETURN RATE............................................................8
   2.23  MATCHING ACCOUNT..................................................................9
   2.24  MATCHING AMOUNT...................................................................9
   2.25  OTHER INCOME......................................................................9
   2.26  PARTICIPANT.......................................................................9
   2.27  PARTICIPATION AGREEMENT...........................................................9
   2.28  PLAN..............................................................................9
   2.29  PLAN YEAR.........................................................................9
   2.30  REGULAR DEFERRAL AMOUNT...........................................................9
   2.31  REGULAR MATCHING AMOUNT..........................................................10
   2.32  REQUIRED DEFERRAL AMOUNT.........................................................10
   2.33  RETIREMENT.......................................................................10
   2.34  SELECTED AFFILIATE...............................................................10
   2.35  SPECIAL BONUS DEFERRAL AMOUNT....................................................10
   2.36  SPECIAL BONUS MATCHING AMOUNT....................................................10
   2.37  VALUATION DATE...................................................................10

ARTICLE III...............................................................................11

ELIGIBILITY AND PARTICIPATION.............................................................11

   3.1   ELIGIBILITY......................................................................11
   3.2   PARTICIPATION....................................................................11
   3.3   CHANGE IN PARTICIPATION STATUS...................................................11
   3.4   INELIGIBLE PARTICIPANT...........................................................11
</TABLE>

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<TABLE>
<S>                                                                                      <C>
ARTICLE IV................................................................................13

DEFERRAL OF COMPENSATION..................................................................13

   4.1   DEFERRAL AMOUNTS.................................................................13
   4.2   MATCHING AMOUNTS.................................................................13
   4.3   CREDITING OF DEFERRAL AMOUNTS AND MATCHING AMOUNTS...............................14

ARTICLE V.................................................................................15

BENEFIT ACCOUNTS..........................................................................15

   5.1   VALUATION OF ACCOUNT.............................................................15
   5.2   CREDITING OF INVESTMENT RETURN...................................................15
   5.3   STATEMENT OF ACCOUNTS............................................................15
   5.4   VESTING OF AMOUNTS...............................................................15
   5.5   INVESTMENT OF REGULAR, ELECTIVE AND REQUIRED DEFERRAL AMOUNTS....................16
   5.6   INVESTMENT OF SPECIAL BONUS DEFERRAL AMOUNTS AND MATCHING AMOUNTS................17

ARTICLE VI................................................................................18

PAYMENT OF BENEFITS.......................................................................18

   6.1   PAYMENT OF DEFERRAL BENEFITS.....................................................18
   6.2   PAYMENT OF DEFERRAL BENEFIT UPON TERMINATION.....................................18
   6.3   PAYMENTS TO BENEFICIARIES UPON DEATH OF PARTICIPANT..............................18
   6.4   HARDSHIP WITHDRAWAL..............................................................18
   6.5   FORM OF PAYMENT..................................................................19
   6.6   COMMENCEMENT OF PAYMENTS.........................................................19
   6.7   SMALL BENEFIT....................................................................19

ARTICLE VII...............................................................................20

BENEFICIARY DESIGNATION...................................................................20

   7.1   BENEFICIARY DESIGNATION..........................................................20
   7.2   CHANGE OF BENEFICIARY DESIGNATION................................................20
   7.3   NO DESIGNATION...................................................................20
   7.4   EFFECT OF PAYMENT................................................................20

ARTICLE VIII..............................................................................21

ADMINISTRATION............................................................................21

   8.1   COMMITTEE........................................................................21
   8.2   INVESTMENTS......................................................................21
   8.3   AGENTS...........................................................................21
   8.4   BINDING EFFECT OF DECISIONS......................................................21
   8.5   INDEMNIFICATION OF COMMITTEE.....................................................21

ARTICLE IX................................................................................22

AMENDMENT AND TERMINATION OF PLAN.........................................................22

   9.1   AMENDMENT........................................................................22
   9.2   TERMINATION......................................................................22

ARTICLE X.................................................................................23

MISCELLANEOUS.............................................................................23

   10.1  FUNDING..........................................................................23
   10.2  NONASSIGNABILITY.................................................................23
   10.3  LEGAL FEES AND EXPENSES..........................................................23
</TABLE>

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<TABLE>
<S>                                                                                       <C>
   10.4  CAPTIONS.........................................................................24
   10.5  GOVERNING LAW....................................................................24
   10.6  SUCCESSORS.......................................................................24
   10.7  RIGHT TO CONTINUED SERVICE.......................................................24

EXHIBIT A.................................................................................25

EXHIBIT B.................................................................................26

EXHIBIT C.................................................................................27
</TABLE>

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                                    ARTICLE I

         1.1 STATEMENT OF PURPOSE

         This is the Equitable Resources, Inc. Deferred Compensation Plan (the
"Plan") made in the form of this Plan and in related agreements between the
Employer and certain management or highly compensated employees. The purpose of
the Plan is to provide management and highly compensated employees of the
Employer with the option to defer the receipt of portions of their compensation
payable for services rendered to the Employer. It is intended that the Plan will
assist in attracting and retaining qualified individuals to serve as officers
and managers of the Employer.

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                                   ARTICLE II

                                   DEFINITIONS

         When used in this Plan and initially capitalized, the following words
and phrases shall have the meanings indicated:

         2.1 ACCOUNT.

         "Account" means the sum of a Participant' s Deferral Account and
Matching Account.

         2.2 BASE SALARY.

                  "Base Salary" means a Participant's base earnings paid by the
Employer to a Participant without regard to any increases or decreases in base
earnings as a result of an election to defer base earnings under this Plan or
(ii) an election between benefits or cash provided under a Plan of an Employer
maintained pursuant to Section 125 or 401(k) of the Code, and as limited in
Exhibit B attached hereto.

         2.3 BENEFICIARY.

         "Beneficiary" means the person or persons designated or deemed to be
designated by the Participant pursuant to Article VII to receive benefits
payable under the Plan in the event of the Participant's death.

         2.4 BOARD.

         "Board" means the Board of Directors of the Company.

         2.5 BONUS.

         "Bonus" means a Participant's bonus or sales commission paid by the
Employer to a Participant under the plans listed in Exhibit B attached hereto
and to the degree limited in Exhibit B, as applicable, without regard to any
decreases as a result of an election to defer all or any portion of a bonus
under this Plan or (ii) an election between benefits or cash provided under a
plan of the Employer maintained pursuant to Section 401(k) of the Code.

         2.6 CHANGE IN CONTROL.

         "Change in Control" means any of the following events:

                  (a) The sale or other disposition by the Company of all or
substantially all of its assets to a single purchaser or to a group of
purchasers, other than to a corporation with respect to which, following such
sale or disposition, more than eighty percent (80%) 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 the
Board of Directors is then owned beneficially, directly or indirectly, by all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the outstanding Company common stock and the combined
voting power of the then outstanding voting securities immediately prior to such
sale or disposition in substantially the same proportion as their ownership of
the outstanding Company common stock and voting power immediately prior to such
sale or disposition.

                  (b) The acquisition in one or more transactions by any person
or group, directly or indirectly, of beneficial ownership of twenty percent
(20%) or more of the

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outstanding shares of Company common stock or the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in
the election of the Board; provided, however, that any acquisition by (x) the
Company or any of its subsidiaries, or any employee benefit plan (or related
trust) sponsored or maintained by the Company or any of its subsidiaries or (y)
any person that is eligible, pursuant to Rule 13d-1(b) under the Exchange Act
(as such rule is in effect as of November 1, 1995) to file a statement on
Schedule 13G with respect to its beneficial ownership of Company common stock
and other voting securities whether or not such person shall have filed a
statement on Schedule 13G, unless such person shall have filed a statement on
Schedule 13D with respect to beneficial ownership of fifteen percent (15%) or
more of the Company's voting securities, shall not constitute a Change of
Control;

                  (c) The Company's termination of its business and liquidation
of its assets;

                  (d) The reorganization, merger or consolidation of the Company
into or with another person or entity, by which reorganization, merger or
consolidation the persons who hold one hundred percent (100%) of the voting
securities of the Company prior to such reorganization, merger or consolidation
receive or continue to hold less than sixty percent (60%) of the outstanding
voting shares of the new or continuing corporation; or

                  (e) If, during any two-year period, less than a majority of
the members of the Board are persons who were either (i) nominated or
recommended for election by at least two-thirds vote of the persons who were
members of the Board or nominated by the Board at the beginning of the period,
or (ii) elected by at least two-thirds vote of the persons who were members of
the Board at the beginning of the period.

         2.7 CODE.

         "Code" means the Internal Revenue Code of 1986, as amended.

         2.8 COMMITTEE.

         "Committee " has the meaning set forth in Section 8.1.

         2.9 COMPANY.

         "Company" means Equitable Resources, Inc. and any successor thereto.

         2.10 COMPENSATION.

         "Compensation" means the Base Salary and Bonus payable with respect to
an Eligible Employee for each Plan Year.

         2.11 CREDITED SERVICE.

         "Credited Service" means the sum of all periods of a Participant's
employment by the Company or a Selected Affiliate for which service credit is
given under the Equitable Resources Pension Plan, as then in effect.

         2.12 DEFERRAL ACCOUNT.

         "Deferral Account" means the account maintained on the books of the
Employer for the purpose of accounting for the amount of Compensation and Other
Income that each Participant elects or is required to defer under the Plan and
for the amount of investment return credited thereto for each Participant
pursuant to Article V.

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         2.13 DEFERRAL AMOUNT.

         "Deferral Amount" means the Regular Deferral Amounts, Special Bonus
Deferral Amounts, Elective Deferral Amounts and Required Deferral Amounts
deferred by a Participant under Section 4.1.

         2.14 DEFERRAL BENEFIT.

         "Deferral Benefit" means the benefit payable to a Participant or his or
her Beneficiary pursuant to Article VI.

         2.15 DEFERRAL ELECTION.

         "Deferral Election" means the written election made by a Participant to
defer Compensation or Other Income pursuant to Article IV. "Regular Deferral
Election" shall mean the written election made by a Participant to defer
Compensation pursuant to Section 4.1(a). "Special Bonus Deferral Election" shall
mean the written election made by a Participant to defer Bonus pursuant to
Section 4.1(b) or 4.2(b). "Other Income Deferral Election" shall mean the
written election made by a Participant to defer Other Income pursuant to Section
4.1(c).

         2.16 DISABILITY.

         "Disability" means a Participant's Disability as defined under the
Company's Long Term Disability Plan or its successors.

         2.17 EARLY RETIREMENT.

         "Early Retirement" will be granted by the Committee at its sole
discretion.

         2.18 ELIGIBLE EMPLOYEE.

         "Eligible Employee" means a highly compensated or management employee
of the Employer who is designated by the Committee, by name or group or
description, in accordance with Section 3.1, as eligible to participate in the
Plan.

         2.19 ELECTIVE DEFERRAL AMOUNT.

         "Elective Deferral Amount" means the amount of Other Income deferred by
a Participant under Section 4.1(c).

         2.20 EMPLOYER.

         "Employer" means, with respect to a Participant, the Company or the
Selected Affiliate which pays such Participant's Compensation.

         2.21 HARDSHIP WITHDRAWAL.

         "Hardship Withdrawal" has the meaning set forth in Section 6.4

         2.22 INVESTMENT RETURN RATE.

         "Investment Return Rate" means:

                  (a) In the case of an investment named in Exhibit C of a fixed
income nature, the interest deemed to be credited as determined in accordance
with the procedures applicable to

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the same investment option provided under the Equitable Resources, Inc. Employee
Savings Plan, originally adopted September 1, 1985, as amended ("EQUITABLE
401(k) PLAN");

                  (b) In the case of an investment named in Exhibit C of an
equity investment nature, the increase or decrease in deemed value and dividends
deemed to be credited as determined in accordance with the procedures applicable
to the same investment option provided under the Equitable 401(k) Plan; or

                  (c) In the case of the Equitable Resources Common Stock Fund,
the increase or decrease in the deemed value, and the reinvestment in the
Equitable Resources Common Stock Fund of any dividends deemed to be credited, as
determined in accordance with the procedures applicable to investments in the
Equitable Resources Common Stock Fund under the Equitable 401(k) Plan.

         2.23 MATCHING ACCOUNT.

         "Matching Account" means the account maintained on the books of the
Employer for the purpose of accounting for the Matching Amount and for the
amount of investment return credited thereto for each Participant pursuant to
Article V.

         2.24 MATCHING AMOUNT.

         "Matching Amount" means the Regular Matching Amounts and Special Bonus
Matching Amounts credited to a Participant's Matching Account under Section 4.2.

         2.25 OTHER INCOME.

         "Other Income" means cash awards, excluding Compensation, paid by the
Employer to a Participant and awards of restricted stock to a Participant.

         2.26 PARTICIPANT.

         "Participant" means any Eligible Employee who elects to participate by
filing a Participation Agreement or who is automatically enrolled with respect
to a Minimum Bonus Deferral Amount as provided in Section 3.2.

         2.27 PARTICIPATION AGREEMENT.

         "Participation Agreement" means the agreement filed by a Participant,
in the form prescribed by the Committee, pursuant to Section 3.2.

         2.28 PLAN.

         "Plan" means the Equitable Resources, Inc. Deferred Compensation Plan,
as amended from time to time.

         2.29 PLAN YEAR.

         "Plan Year" means a twelve-month period commencing January 1 and ending
the following December 31.

         2.30 REGULAR DEFERRAL AMOUNT.

         "Regular Deferral Amount" means the amount of Compensation deferred by
a Participant under Section 4.1(a).

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         2.31 REGULAR MATCHING AMOUNT.

         "Regular Matching Amount" means the amount credited to a Participant's
Company Matching Account under Section 4.2(a).

         2.32 REQUIRED DEFERRAL AMOUNT.

         "Required Deferral Amount" means the amount, other than Compensation,
automatically credited to a Participant's Deferral Account pursuant to the terms
of a special benefit or bonus plan (other than a plan listed on Exhibit B).

         2.33 RETIREMENT.

         "Retirement" means the termination of a Participant who has reached age
65.

         2.34 SELECTED AFFILIATE.

         "Selected Affiliate" means (1) any company in an unbroken chain of
companies beginning with the Company if each of the companies other than the
last company in the chain owns or controls, directly or indirectly, stock
possessing not less than 50 percent of the total combined voting power of all
classes of stock in one of the other companies, or (2) any partnership or joint
venture in which one or more of such companies is a partner or venturer, each of
which shall be selected by the Committee.

         2.35 SPECIAL BONUS DEFERRAL AMOUNT.

         "Special Bonus Deferral Amount" means the sum of the Minimum Bonus
Deferral Amounts and the Discretionary Bonus Deferral Amounts deferred by
certain direct and indirect reports to the Chief Executive Officer of the
Company ("CEO") described in Section 4.1(b). "MINIMUM BONUS DEFERRAL AMOUNT"
shall refer to the 20% and 10%, as applicable, Bonus deferrals described in
Section 4.1(b) which must be made by such direct and indirect reports to the
CEO. "DISCRETIONARY BONUS DEFERRAL AMOUNTS" shall refer to any additional Bonus
deferrals made by such direct and indirect reports to the CEO in excess of the
Minimum Bonus Deferral Amount. "EQUIVALENT MINIMUM BONUS DEFERRAL AMOUNT" shall
refer to any Bonus deferral equivalent to the Minimum Bonus Deferral Amount made
by such direct and indirect reports to the CEO who is authorized but not
obligated to defer such amount as described in Sections 4.1(b) and 4.2(b).

         2.36 SPECIAL BONUS MATCHING AMOUNT.

         "Special Bonus Matching Amount" means the amount credited to a
Participant's Matching Account under Section 4.2(b).

         2.37 VALUATION DATE.

         "Valuation Date" means a date on which the amount of a Participant's
Account is valued as provided in Article V. The Valuation Date shall be the last
day of each calendar quarter and any other date determined by the Committee.

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                                   ARTICLE III

                          ELIGIBILITY AND PARTICIPATION

         3.1 ELIGIBILITY.

         Eligibility to participate in the Plan is limited to Eligible
Employees. From time to time, and subject to Section 3.4, the Committee shall
prepare, and attach to the Plan as Exhibit A, a complete list of the Eligible
Employees, by individual name or by reference to an identifiable group of
persons or by descriptions of the components of compensation of an individual
which would qualify individuals who are eligible to participate, and all of whom
shall be a select group of management or highly compensated employees.

         3.2 PARTICIPATION.

         (a) Regular Deferrals. Except as otherwise provided in (b),
participation in the Plan shall be limited to Eligible Employees who elect to
participate in the Plan by filing a Participation Agreement with the Committee.
An Eligible Employee shall commence participation in the Plan upon the first day
of the Plan Year following the receipt of his or her Participation Agreement by
the Committee or within 30 days of becoming a Participant if such date occurs
after the commencement of the Plan Year.

         (b) Minimum Bonus Deferral Amounts. Notwithstanding (a), an Eligible
Employee who is required to defer a Minimum Bonus Deferral Amount or a Required
Deferral Amount into the Plan under Section 4.1(b) or 4.1(d) shall automatically
become a Participant in the Plan regardless of whether the Participant files a
Participation Agreement.

         3.3 CHANGE IN PARTICIPATION STATUS.

         (a) Regular Deferral and Elective Deferral Amounts. Except as otherwise
required in Section 3.2(b) and as otherwise provided in Sections 3.3(b) and (c)
below, a Participant may elect to terminate his or her participation in the Plan
at any time by filing a written notice thereof with the Committee. A termination
of participation with respect to Regular Deferral and/or Elective Deferral
Amounts will become effective as of the beginning of the next Plan Year
following receipt of the termination election by the Committee and in accordance
with the Committee's prevailing administrative procedures.

         (b) Special Bonus Deferral Amounts. A termination of participation with
respect to Discretionary Bonus Deferral Amounts will become effective as of the
start of the next Bonus measurement period. A Participant shall not be permitted
to terminate the deferral of Minimum Bonus Deferral Amounts.

         (c) Required Deferral Amounts. A Participant shall only be permitted to
terminate the deferral of Required Deferral Amounts in accordance with the
provisions of the governing employee benefit or bonus plan under which the
payment was made.

         (d) Amounts credited to such Participant's Account with respect to
periods prior to the effective date of a termination described in (a), (b) or
(c) shall continue to be payable pursuant to, receive investment credit on, and
otherwise be governed by, the terms of the Plan.

         3.4 INELIGIBLE PARTICIPANT

         Notwithstanding any other provisions of this Plan to the contrary, if
the Committee determines that any Participant may not qualify as a "management
or highly compensated employee" within the meaning of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or regulations thereunder,
the Committee may determine, in its

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sole discretion, that such Participant shall cease to be eligible to participate
in this Plan. Upon such determination, the Employer shall distribute (in cash
and/or in kind, as applicable) to the Participant an amount equal to the vested
amount credited to his Account as soon as administratively practicable. Upon
such payment, no benefit shall thereafter be payable under this Plan either to
the Participant or any Beneficiary, and all of the Participant' s elections as
to the time and manner of payment of his Account will be deemed to be canceled.

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                                   ARTICLE IV

                            DEFERRAL OF COMPENSATION

         4.1 DEFERRAL AMOUNTS.

         (a) Regular Deferral Amount. Subject to paragraph (b), below, with
respect to each Plan Year, a Participant may elect to defer a specified
percentage of his or her Compensation as provided in Exhibit B. Subject to
paragraph (b) below, a Participant may change the percentage of his or her
Compensation to be deferred by filing a new Regular Deferral Election with the
Committee. Any permitted changes in such deferral election shall be effective as
of the first day of the Plan Year immediately following the Plan Year in which
such Deferral Election is filed with the Committee and shall continue in effect
for future years.

         (b) Special Bonus Deferral Amount. Notwithstanding paragraph (a),above,
pursuant to the terms of the applicable Bonus plan, a Participant who reports
directly to the Company's Chief Executive Officer may be required to defer at
least twenty percent (20%) of his or her Bonus and a Participant who reports
directly to an executive who reports directly to the Company's Chief Executive
Officer may be required to defer at least ten percent (10%) of his or her Bonus,
into the Plan (the "Minimum Bonus Deferral Amount"). If the Bonus plan
applicable to a Participant waives the required Minimum Bonus Deferral when
stock ownership guidelines are met, and the Participant has met the applicable
guidelines, then he is eligible to defer an Equivalent Minimum Bonus Deferral
Amount hereunder. Notwithstanding anything herein to the contrary, a Participant
required to defer a Minimum Bonus Deferral Amount shall not be permitted to
elect to make a change in a Special Bonus Deferral Election below the Minimum
Bonus Deferral Amount.

         (c) Elective Deferral Amount. A Participant may elect to defer a
specified percentage or designated item of Other Income to the extent such
income is attributable to services performed by the Participant after the
election becomes effective, and, with respect to Other Income granted in the
form of restricted property or other property subject to any vesting criteria,
prior to the lapse of the restrictions thereon and during a period when such
lapse of restrictions or vesting is substantially uncertain to occur. A
Participant may change the percentage or designated items of his or her Other
Income to be deferred by filing a new Other Income Deferral Election with the
Committee. Any such change in deferral election shall be effective as of the
first day of the Plan Year immediately following the Plan Year in which such
Deferral Election is filed with the Committee or, if later in the case of a
deferral of restricted property, the Plan Year immediately following the last
year in which such restrictions are scheduled to lapse

         (d) Required Deferral Amount. A Participant may be entitled to receive
an award, other than Compensation, under a special benefit or bonus plan (other
than a plan listed on Exhibit B), the terms of which require deferral of some or
all of the award into his or her Deferral Account . Notwithstanding anything
herein to the contrary, a Participant required to defer a Required Deferral
Amount shall not be permitted to elect to make a change in the deferral election
except as otherwise permitted by the terms of the special benefit or bonus plan.

         4.2 MATCHING AMOUNTS.

         (a) Regular Matching Amount. Subject to paragraph (b), below, if the
Committee authorizes a Regular Matching Amount with respect to, and preceding,
any Plan Year(s), the Employer shall provide Regular Matching Amounts under this
Plan with respect to each Participant who is eligible to be allocated matching
contributions under the Savings Plan. The total Regular Matching Amounts under
this Plan on behalf of a Participant for each Plan Year shall not exceed the
difference between the matching percentage of the Compensation deferred by a
Participant under this Plan pursuant to the Participant's Regular Deferral
Election

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and of the Participant's pre-tax elective deferrals for the Plan Year under the
Savings Plan, less (ii) the Employer matching contributions allocated to the
Participant under the Savings Plan for such Plan Year.

         (b) Special Bonus Matching Amount. Notwithstanding paragraph (a),
above, a Participant (i) who is either required to defer a Minimum Bonus
Deferral Amount under Section 4.1(b), or who is eligible and elects to defer an
amount equivalent to the applicable Minimum Bonus Deferral Amount ("Equivalent
Minimum Bonus Deferral Amount") and (ii)who elects to defer a Discretionary
Bonus Deferral Amount shall be credited with a Special Bonus Matching Amount
equal to twenty-five one hundredths (.25) of one (1) share of the Common Stock
of the Company for every one (1) share of the Common Stock of the Company deemed
to be purchased under the Plan pursuant to Section 5.6 with the Discretionary
Bonus Deferral Amount. There shall be no limit on a Participant's Special Bonus
Matching Amount. Only Participants subject to the requirement to defer a Minimum
Bonus Deferral Amount or who are authorized hereunder to defer an Equivalent
Minimum Bonus Deferral Amount shall be eligible to defer a Discretionary Bonus
Deferral Amount.

         (c) Neither Minimum Bonus Deferral Amounts, Equivalent Minimum Bonus
Deferral Amounts, Elective Deferral Amounts nor Required Deferral Amounts shall
be credited with any matching contributions under the Plan.

         4.3 CREDITING OF DEFERRAL AMOUNTS AND MATCHING AMOUNTS.

         Participant's Deferral Amounts shall be credited by the Employer to the
Participant's Deferral Account periodically, the frequency of which will be
determined by the Committee. To the extent that the Employer is required to
withhold any taxes or other amounts from a Participant's Deferral Amounts
pursuant to any state, federal or local law, such amounts shall be withheld only
from the Participant's income other than the Deferral Amounts . The Matching
Amounts under the Plan for each Participant shall be credited by the Employer to
the Participant's Matching Account periodically, the frequency of which will be
determined by the Committee.

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                                    ARTICLE V

                                BENEFIT ACCOUNTS

         5.1 VALUATION OF ACCOUNT.

         As of each Valuation Date, a Participant's Account shall consist of the
balance of the Participant's Account as of the immediately preceding Valuation
Date, plus the Participant's Deferral Amounts and Matching Amounts credited
pursuant to Sections 4.1 and 4.2 since the immediately preceding Valuation Date,
plus or minus investment gain or loss credited as of such Valuation Date
pursuant to Section 5.2, minus the aggregate amount of distributions, if any,
made from such Account since the immediately preceding Valuation Date.

         5.2 CREDITING OF INVESTMENT RETURN.

         As of each Valuation Date, each Participant's Deferral Account and
Matching Account shall be increased or decreased by the amount of investment
gain or loss earned since the immediately preceding Valuation Date. Investment
return shall be credited at the Investment Return Rate as of such Valuation Date
based on the balance of the Participant's Deferral Account and Matching Account,
respectively, since the immediately preceding Valuation Date, but after such
Accounts have been adjusted for any contributions or distributions to be
credited or deducted for such period. Investment return for the period prior to
the first Valuation Date applicable to a Deferral Account or a Matching Account
shall be deemed earned ratably over such period. Until a Participant or his or
her Beneficiary receives his or her entire Account, the unpaid balance thereof
shall earn an investment return as provided in this Section 5.2.

         5.3 STATEMENT OF ACCOUNTS.

         The Committee shall provide to each Participant, within 30 days after
the close of each calendar quarter, a statement setting forth the balance of
such Participant's Account as of the last day of the preceding calendar quarter
and showing all adjustments made thereto during such calendar quarter.

         5.4 VESTING OF AMOUNTS.

         Except as provided in Sections 10.1 and 10.2, a Participant shall be
100% vested in the amounts credited to his or her Account in the event of a
Change in Control. Prior to a Change in Control, amounts credited to a
Participant's Deferral Account or Matching Account shall vest in accordance with
the following paragraphs of this Section 5.4.

                  (a) Regular Deferral Amounts. A Participant shall be 100%
vested in the Regular Deferral Amounts credited to his or her Deferral Account
at all times.

                  (b) Special Bonus Deferral Amounts. The Minimum Bonus Deferral
Amount or the Equivalent Minimum Bonus Deferral Amount credited to a
Participant's Deferral Account with respect to each Plan Year shall vest in
increments of fifty percent (50, with the first 50% vesting upon the completion
of the first year of Credited Service following the Plan Year to which the
Deferral Amount relates and the remaining 50% vesting upon the completion of the
second year of Credited Service following such Plan Year. Any nonvested portion
of a Participant's Minimum Bonus Deferral Amount or Equivalent Minimum Bonus
Deferral Amount shall be forfeited if the Participant voluntarily resigns from
the Company. A Participant shall be 100% vested in the Discretionary Bonus
Deferral Amounts credited to his or her Deferral Account at all times. Nonvested
portions of a Participant's Minimum Bonus Deferral Amount or Equivalent Minimum
Bonus Deferral Amount shall be paid to the Participant if the Participant is
involuntarily terminated by the Company for any reason other than cause or to
his beneficiary if Participant dies while employed.

                                      -15-
<PAGE>   16

                  (c) Elective Deferral Amounts. A Participant shall be 100%
vested in the Elective Deferral Amounts credited to his or her Deferral Account
at all times.

                  (d) Required Deferral Amounts. Required Deferral Amounts shall
vest in accordance with the provisions of the special benefit or bonus plan
under which the award is deferred into the Plan.

                  (e) Regular Matching Amounts. A Participant's Regular Matching
Amounts shall vest in accordance with the vesting schedule for Company
Contributions under the Equitable 401(k) Plan.

                  (f) Special Bonus Matching Amounts. The Special Bonus Matching
Amounts credited to a Participant's Matching Account with respect to each Plan
Year shall vest in increments of thirty-three and one-third percent (33.3%);
with the first 33.3% vesting upon the completion of the first year of Credited
Service following the Plan Year to which the Special Bonus Matching Amount
relates and the two remaining portions vesting upon the completion of the second
and third years, respectively, of Credited Service following the Plan Year to
which the Special Bonus Matching Amount relates. Any nonvested portion of a
Participant's Special Bonus Matching Amount shall be forfeited if the
Participant terminates employment with the Company for any reason.

                  (g) Application of Forfeitures. Forfeitures under the Plan
shall be for the benefit of the Company and shall not be credited to other
Participants.

         5.5 INVESTMENT OF REGULAR, ELECTIVE AND REQUIRED DEFERRAL AMOUNTS.

         A Participant may direct that the portion of his or her Deferral
Account attributable to Regular and Elective Deferral Amounts under Sections
4.1(a) and 4.1 (c) be deemed to be invested in one or more of the investment
options listed in Exhibit C, in increments of whole percents (1%) or whole
dollars ($1.00) of the value of his or her Regular Deferral and Elective
Deferral Amount (a "New Money Election"). A Participant also may direct that
Regular and Elective Deferral Amounts previously credited to his or her Deferral
Account and deemed to be invested in one or more of the investment options
listed in Exhibit C, be transferred, in increments of whole percents (1%) or
whole dollars ($1.00) of the value of his or her Regular and Elective Deferral
Amount between and among the then available investment options listed in Exhibit
C (a "Reallocation Election"); provided that a Participant may not reallocate
Regular and Elective Deferral Amounts previously credited to his or her Deferral
Account and deemed to be invested in the Equitable Resources Common Stock Fund.
A New Money Election or a Reallocation Election must be filed with the Committee
in accordance with uniform rules established by the Committee. A Reallocation
Election shall not change a Participant's existing New Money election. A
Participant may direct investment of his or her Required Deferral Amounts under
Section 4.1(d) in the same manner as Regular and Elective Deferral Amounts,
unless otherwise provided under the terms of the special benefit or bonus plan
under which the award was made.

         The effective date of any New Money Election or Reallocation Election
shall be the Valuation Date on which such election is received by the Committee
in accordance with uniform rules established by the Committee. The Company is
not required to follow any deemed investment election of any Participant and
reserves the right to refuse to honor any Participant direction related to
investments or withdrawals, including transfers among investment options, where
necessary or desirable to assure compliance with applicable law including U.S.
and other securities laws. However, the Company does not assume any
responsibility for compliance by officers or others with any such laws, and any
failure by the Company to delay or dishonor any such direction shall not be
deemed to increase the Company's legal exposure to the Participant or third
parties.

                                      -16-
<PAGE>   17

         The election of deemed investments among the options provided above
shall be the sole responsibility of each Participant. The Company, the
Employers, their employees and Committee members are not authorized to make any
recommendation to any Participant with respect to such election. Each
Participant assumes all risk connected with any adjustment to the value of his
Deferral Account. Neither the Committee, the Company, nor the Employers in any
way guarantees against loss or depreciation.

         5.6 INVESTMENT OF SPECIAL BONUS DEFERRAL AMOUNTS AND MATCHING AMOUNTS.

         Notwithstanding anything in Section 5.5 to the contrary, a
Participant's Special Bonus Deferral Amounts under Section 4.1(b) and all
amounts credited to a Participant's Matching Account under Section 4.2 shall be
deemed to be invested in the Equitable Resources Common Stock Fund. A
Participant shall have no right to direct the investment of his Special Bonus
Deferral Amounts and the amounts to be credited to his Matching Account.

                                      -17-
<PAGE>   18

                                   ARTICLE VI

                               PAYMENT OF BENEFITS

         6.1 PAYMENT OF DEFERRAL BENEFITS.

         Except as otherwise provided in Sections 6.2, 6.3, 6.4 or 6.7 , the
Employer shall pay to the Participant or his Beneficiary a Deferral Benefit
equal to the balance of his or her vested Account determined pursuant to Article
V, less any amounts previously distributed, based on his written Deferral
Election, in such form as provided in Section 6.5.

         6.2 PAYMENT OF DEFERRAL BENEFIT UPON TERMINATION.

         Upon the termination of service of the Participant as an employee of
the Employer and all Selected Affiliates for reasons other than death,
Disability, Early Retirement or Retirement, the Employer shall pay to the
Participant a Deferral Benefit in a lump sum equal to the balance of his or her
vested Account determined pursuant to Article V, less any amounts previously
distributed, as soon as administratively practicable following such termination.

         6.3 PAYMENTS TO BENEFICIARIES UPON DEATH OF PARTICIPANT.

         In the event of the Participant's death after commencement of
installment payments but prior to his or her receipt of all elected annual
installments, his or her Beneficiary will receive the remaining annual
installments at such times as such installments would have become distributable
to the Participant. In the event of the Participant's death prior to
commencement of installment payments due under the Plan, the first installment
payment to the Beneficiary, shall be made on the last business day of March in
the calendar year following the calendar year during which the Participant's
death occurs and shall be paid in the same form of payment as would have been
applicable to the Participant had the Participant survived.

         6.4 HARDSHIP WITHDRAWAL.

         In the event that the Committee, upon the written request of a
Participant, determines, in its sole discretion, that the Participant has
suffered an unforeseeable financial emergency, the Company shall pay to the
Participant, as soon as practicable following such determination, an amount
necessary to meet the emergency (the "Hardship Withdrawal"), but not exceeding
the aggregate balance of such Participant's vested Deferral Account as of the
date of such payment. For purposes of this Section 6.4, an "unforeseeable
financial emergency" is an unanticipated emergency caused by an event that is
beyond the control of the Participant or Beneficiary and that would result in
severe financial hardship to the Participant or Beneficiary if an early hardship
withdrawal were not permitted. The Participant or Beneficiary shall provide to
the Committee such evidence as the Committee may require to demonstrate that
such emergency exists and financial hardship would occur if the withdrawal were
not permitted.. The amount of a Hardship Withdrawal may not exceed the amount
the Committee reasonably determines to be necessary to meet such emergency needs
(including taxes incurred by reason of a taxable distribution). For purposes of
the Plan, a hardship shall be considered to constitute an immediate and
unforeseen financial hardship if the Participant or Beneficiary has an
unexpected need for cash to pay for expenses incurred by him or her or a member
of his or her immediate family (spouse and/or natural or adopted children) such
as illness, casualty loss or death. Cash needs arising from foreseeable events,
such as the purchase or building of a house or education expenses will not by
themselves be considered to be the result of an unforeseeable financial
emergency. The amount of the Deferral Benefit otherwise payable under the Plan
to such Participant shall be adjusted to reflect the early payment of the
Hardship Withdrawal.

                                      -18-
<PAGE>   19

         6.5 FORM OF PAYMENT.

         The Deferral Benefit payable pursuant to Section 6.1 shall be paid in
one of the following forms, as elected by the Participant in his or her Deferral
Election on file with respect to the particular year to which the Deferral
Benefit relates:

                  (a) Annual payments of a fixed amount which shall amortize the
vested Account balance as of the payment commencement date over a period of
five, ten or fifteen years (together, in the case of each annual payment, with
interest thereon credited after the payment commencement date pursuant to
Section 5.2).

                  (b) A lump sum.

         In the event a Participant fails to make a distribution election, his
or her vested Account balance shall be distributed in a lump sum.
Notwithstanding the foregoing, that portion of a Participant's Account
attributable to Special Bonus Deferral Amounts and all Matching Amounts shall be
paid in Common Stock of the Company, with any fractional shares paid in cash in
a lump sum.

         The Participant's Deferral Election with respect to a particular year
shall, when made, specify the year or years of payment of the Deferral Amount
provided that the payment may not commence earlier than the year following the
Plan Year to which the Deferral Election relates.

         6.6 COMMENCEMENT OF PAYMENTS.

         Commencement of payments under Section 6.1 of the Plan shall begin
within 60 days following (i) receipt of written notice by the Committee of an
event which entitles a Participant (or a Beneficiary) to payments under the Plan
or (ii) the beginning of the particular year elected by the Participant in a
Deferral Election to which the benefits payable relate.

         6.7 SMALL BENEFIT.

         In the event the Committee determines that the balance of a
Participant's vested Account is less than $5,000 at the time of commencement of
payments, or the portion of the balance of the Participant's vested Account
payable to any Beneficiary is less than $5,000 at the time of commencement of
payments, the Committee may inform the Employer and the Employer, in its
discretion, may choose to pay the benefit in the form of a lump sum payment,
notwithstanding any provision of the Plan or a Participant election to the
contrary. Such lump sum payment shall be equal to the balance of the
Participant's vested Account or the portion thereof payable to a Beneficiary.

                                      -19-
<PAGE>   20

                                   ARTICLE VII

                             BENEFICIARY DESIGNATION

         7.1 BENEFICIARY DESIGNATION.

         Each Participant shall have the sole right, at any time, to designate
any person or persons as his Beneficiary to whom payment under the Plan shall be
made in the event of his or her death prior to complete distribution to the
Participant of his or her Account. Any Beneficiary designation shall be made in
a written instrument provided by the Committee. All Beneficiary designations
must be filed with the Committee and shall be effective only when received in
writing by the Committee. In the event that a Beneficiary form has not been
filed, the Beneficiary to whom payment has been designated under the Savings
Plan shall be used.

         7.2 CHANGE OF BENEFICIARY DESIGNATION.

         Any Beneficiary designation may be changed by a Participant by the
filing of a new Beneficiary designation, which will cancel all Beneficiary
designations previously filed but which will not be effective and supersede all
prior designations until it is received and acknowledged by the Committee or its
delegate. The designation of a Beneficiary may be made or changed at any time
without the consent of any person.

         7.3 NO DESIGNATION.

         If a Participant fails to designate a Beneficiary as provided above, or
if all designated Beneficiaries predecease the Participant, then the
Participant's designated Beneficiary shall be deemed to be the Participant's
estate.

         7.4 EFFECT OF PAYMENT.

         Payment to a Participant's Beneficiary (or, upon the death of a primary
Beneficiary, to the contingent Beneficiary or, if none, to the Participant's
estate) shall completely discharge the Employer's obligations under the Plan.

                                      -20-
<PAGE>   21
                                  ARTICLE VIII

                                 ADMINISTRATION

         8.1 COMMITTEE.

         The administrative committee for the Plan (the "Committee") shall be
the Benefits Administration Committee of the Company. The Committee shall have
(i) complete discretion to supervise the administration and operation of the
Plan, (ii) complete discretion to adopt rules and procedures governing the Plan
from time to time, and (iii) sole authority to give interpretive rulings with
respect to the Plan.

         8.2 INVESTMENTS.

         The Benefits Investment Committee of the Company shall have the sole
discretion to choose the investment options available under the Plan and to
change or eliminate such investment options, from time to time, as it deems
appropriate.

         8.3 AGENTS.

         The Committee may appoint an individual, who may be an employee of the
Company, to be the Committee's agent with respect to the day-to-day
administration of the Plan. In addition, the Committee may, from time to time,
employ other agents and delegate to them such administrative duties as it sees
fit, and may from time to time consult with counsel who may be counsel to the
Company.

         8.4 BINDING EFFECT OF DECISIONS.

         Any decision or action of the Committee with respect to any question
arising out of or in connection with the administration, interpretation and
application of the Plan shall be final and binding upon all persons having any
interest in the Plan.

         8.5 INDEMNIFICATION OF COMMITTEE.

         The Company shall indemnify and hold harmless the members of the
Committee and the Benefits Investment Committee and their duly appointed agents
under Section 8.3 against any and all claims, loss, damage, expense or liability
arising from any action or failure to act with respect to the Plan, except in
the case of gross negligence or willful misconduct by any such member or agent
of the Committee or Benefits Investment Committee.

                                      -21-
<PAGE>   22

                                   ARTICLE IX

                        AMENDMENT AND TERMINATION OF PLAN

         9.1 AMENDMENT.

         The Company, on behalf of itself and of each Selected Affiliate may at
any time amend, suspend or reinstate any or all of the provisions of the Plan,
except that no such amendment, suspension or reinstatement may adversely affect
any Participant's Account, as it existed as of the day before the effective date
of such amendment, suspension or reinstatement, without such Participant's prior
written consent. Written notice of any amendment or other action with respect to
the Plan shall be given to each Participant.

         9.2 TERMINATION.

         The Company, on behalf of itself and of each Selected Affiliate, in its
sole discretion, may terminate this Plan at any time and for any reason
whatsoever unless otherwise provided by the special benefit or bonus plan
governing a particular account. Upon termination of the Plan, Participants shall
be 100% vested in all amounts credited to their Accounts. On and after Plan
termination, the Committee shall take those actions necessary to administer any
Accounts existing prior to the effective date of such termination; provided,
however, that a termination of the Plan shall not adversely affect the value of
a Participant's Account, the crediting of investment return under Section 5.2 or
the timing or method of distribution of a Participant' s Account except as
otherwise provided in the Plan, without the Participant's prior written consent.

                                      -22-
<PAGE>   23

                                    ARTICLE X

                                  MISCELLANEOUS

         10.1 FUNDING.

         Participants, their Beneficiaries, and their heirs, successors and
assigns, shall have no secured interest or claim in any property or assets of
the Employer or the Company. The Employer's and the Company's obligation under
the Plan shall be merely that of an unfunded and unsecured promise of the
Employer or the Company to pay money in the future. To the extent that any
Participant or Beneficiary or other person acquires a right to receive payments
under the Plan, such right shall be no greater than the right, and each
Participant and Beneficiary shall at all times have the status, of a general
unsecured creditor of the Company or any Employer. Notwithstanding the
foregoing, in the event of a Change in Control, the Company shall create an
irrevocable trust, subject to the claim of creditors, or before such time the
Company may create such an irrevocable or revocable trust, to hold funds to be
used in payment of the obligations of Employers under the Plan if such trust
will not cause the Plan to be considered a funded deferred compensation plan
under ERISA or the Code. In the event of a Change in Control or prior thereto,
the Employers shall fund such trust in an amount equal to not less than the
total value of the Participants' Accounts under the Plan as of the Valuation
Date immediately preceding the Change in Control, provided that any funds
contained therein shall remain liable for the claims of the respective
Employer's general creditors.

         10.2 NONASSIGNABILITY.

         No right or interest under the Plan of a Participant or his or her
Beneficiary (or any person claiming through or under any of them) shall be
assignable or transferable in any manner or be subject to alienation,
anticipation, sale, pledge, encumbrance or other legal process or in any manner
be liable for or subject to the debts or liabilities of any such Participant or
Beneficiary. If any Participant or Beneficiary shall attempt to or shall
transfer, assign, alienate, anticipate, sell, pledge or otherwise encumber his
or her benefits hereunder or any part thereof, or if by reason of his or her
bankruptcy or other event happening at any time such benefits would devolve upon
anyone else or would not be enjoyed by him or her, then the Committee, in its
discretion, may terminate his or her interest in any such benefit (including the
Deferral Account) to the extent the Committee considers necessary or advisable
to prevent or limit the effects of such occurrence. Termination shall be
effected by filing a written "termination declaration" with the Clerk of the
Company and making reasonable efforts to deliver a copy to the Participant or
Beneficiary whose interest is adversely affected (the "Terminated Participant").

         As long as the Terminated Participant is alive, any benefits affected
by the termination shall be retained by the Employer and, in the Committee's
sole and absolute judgment, may be paid to or expended for the benefit of the
Terminated Participant, his or her spouse, his or her children or any other
person or persons in fact dependent upon him or her in such a manner and at such
times as the Committee shall deem proper. Upon the death of the Terminated
Participant, all benefits withheld from him or her and not paid to others in
accordance with the preceding sentence shall be disposed of according to the
provisions of the Plan that would apply if he or she died prior to the time that
all benefits to which he or she was entitled were paid to him or her.

         10.3 LEGAL FEES AND EXPENSES.

         It is the intent of the Company and each Selected Affiliate that no
Eligible Employee or former Eligible Employee be required to incur the expenses
associated with the enforcement of his or her rights under this Plan by
litigation or other legal action because the cost and expense thereof would
substantially detract from the benefits intended to be extended to an Eligible
Employee hereunder. Accordingly, if after a Change in Control it should appear
that

                                      -23-
<PAGE>   24

the Employer has failed to comply with any of its obligations under this Plan or
in the event that the Employer or any other person takes any action to declare
this Plan void or unenforceable, or institutes any litigation designed to deny,
or to recover from, the Eligible Employee the benefits intended to be provided
to such Eligible Employee hereunder, the Employer irrevocably authorizes such
Eligible Employee from time to time to retain counsel of his or her choice, at
the expense of the Employer as hereafter provided, to represent such Eligible
Employee in connection with the initiation or defense of any litigation or other
legal action, whether by or against the Employer or any director, officer,
stockholder or other person affiliated with the Employer in any jurisdiction.
Notwithstanding any existing or prior attorney-client relationship between the
Employer and such counsel, the Employer irrevocably consents to such Eligible
Employee's entering into an attorney-client relationship with such counsel, and
in that connection the Employer and such Eligible Employee agree that a
confidential relationship shall exist between such Eligible Employee and such
counsel, The Employer shall pay and be solely responsible for any and all
attorneys' and related fees and expenses incurred by such Eligible Employee as a
result of the Employer's failure to perform under this Plan or any provision
thereof; or as a result of the Employer or any person contesting the validity or
enforceability of this Plan or any provision thereof. Notwithstanding the
foregoing, nothing herein shall require the Company to pay any attorney or
related fees and expenses or to consent to an Employee's use of counsel retained
by the Company prior to the occurrence of a Change in Control.

         10.4 CAPTIONS.

         The captions contained herein are for convenience only and shall not
control or affect the meaning or construction hereof.

         10.5 GOVERNING LAW.

         The provisions of the Plan shall be construed and interpreted according
to the laws of the Commonwealth of Pennsylvania without regard to its conflicts
of laws provisions.

         10.6 SUCCESSORS.

         The provisions of the Plan shall bind and inure to the benefit of the
Company, its Selected Affiliates, and their respective successors and assigns.
The term successors as used herein shall include any corporate or other business
entity which shall, whether by merger, consolidation, purchase or otherwise,
acquire all or substantially all of the business and assets of the Company or a
Selected Affiliate and successors of any such Company or other business entity.

         10.7 RIGHT TO CONTINUED SERVICE.

         Nothing contained herein shall be construed to confer upon any Eligible
Employee the right to continue to serve as an Eligible Employee of the Employer
or in any other capacity.

                                      -24-
<PAGE>   25

                                    EXHIBIT A

RE:      SECTION 3.1 - DESCRIPTION OF ELIGIBLE EMPLOYEES

THE COMMITTEE HAS DETERMINED THAT THE FOLLOWING NAMED INDIVIDUALS OR GROUPS OF
PERSONS OR DESCRIPTIONS OF THE COMPONENTS OF COMPENSATION OF AN INDIVIDUAL WHICH
WOULD QUALIFY INDIVIDUALS WHICH ARE ELIGIBLE TO PARTICIPATE IN THE PLAN AS
ELIGIBLE EMPLOYEES:

            Employees classified in Company salary grade 18 and above

                                      -25-
<PAGE>   26

                                    EXHIBIT B

RE:      SECTION 4.1 - AMOUNT OF DEFERRAL

AS OF THE DATE ABOVE, AND EFFECTIVE UNTIL THIS EXHIBIT IS MODIFIED BY THE
COMMITTEE, THE TABLE BELOW INDICATES THE TYPES OF COMPENSATION WHICH ARE
ELIGIBLE FOR INCOME DEFERRAL AT THE ASSIGNED PERCENTAGES AS NOTED:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------

   TYPE OF COMPENSATION               MAXIMUM PERCENTAGE                     OTHER LIMITATIONS
                                      THAT CAN BE DEFERRED
----------------------------------------------------------------------------------------------------------
<S>                                   <C>                             <C>

Base Salary                        N/A                                Any amount over IRS limit

----------------------------------------------------------------------------------------------------------

Bonus under annual Short-Term      100%                               In increments of 1% or the entire
Incentive Plans                                                       amount of the Bonus awarded in
                                                                      excess of a stated dollar amount.
----------------------------------------------------------------------------------------------------------
</TABLE>

                                      -26-
<PAGE>   27

                                    EXHIBIT C

RE:  SECTION 2.21 - INVESTMENT RETURN RATE

The following are the investment options that are used in determining the
Investment Return Rate under the Plan.

-------------------------------------------------------------------------------
             Account Name                                   Ticker Symbol
-------------------------------------------------------------------------------
Equitable Resources Common Stock Fund                            EQT
-------------------------------------------------------------------------------
Putnam International Growth Fund                                POVSX
-------------------------------------------------------------------------------
Putnam OTC & Emerging Growth Fund                               POEGX
-------------------------------------------------------------------------------
Putnam Voyager Fund                                             PVOYX
-------------------------------------------------------------------------------
Putnam Vista Fund                                               PVISX
-------------------------------------------------------------------------------
The George Putnam Fund of Boston                                PGEOX
-------------------------------------------------------------------------------
The Putnam Fund for Growth and Income                           PGRWX
-------------------------------------------------------------------------------
Putnam Income Fund                                              PINCX
-------------------------------------------------------------------------------
PIMCO Total Return Fund                                         PTRAX
-------------------------------------------------------------------------------
Putnam Asset Allocation: Growth                                 PAEAX
-------------------------------------------------------------------------------
Putnam Asset Allocation: Balanced                               PABAX
-------------------------------------------------------------------------------
Putnam Asset Allocation: Conservative                           PACAX
-------------------------------------------------------------------------------

                                      -27-<PAGE>   1

                                                                    Exhibit 10.4

                            EQUITABLE RESOURCES, INC.

                 PRODUCTION LONG-TERM PERFORMANCE INCENTIVE PLAN

         EQUITABLE RESOURCES, INC. (the "Company") hereby establishes the
Equitable Resources, Inc. Production Long-Term Performance Incentive Plan (the
"Plan") for the benefit of certain executives of the Company effective as of the
18th day of January, 2001.

         WHEREAS, the Company maintains certain incentive award plans, including
the Equitable Resources, Inc. 1999 Long-Term Incentive Plan, pursuant to which
stock-based incentive awards are granted to selected executive employees; and

         WHEREAS, in order to further align the interests of the persons
primarily responsible for the success of the Company with the interests of the
shareholders, the Company desires to provide additional long term incentive
benefits through the Plan.

         NOW THEREFORE, the Company hereby provides for additional incentive
benefits for certain executive employees of the Company on the following terms
and conditions:

         Section 1. Eligibility. The Chief Executive Officer of the Company (the
"CEO") shall, in his sole discretion, select the executive employees of the
Production segment of the Company who shall be eligible to participate in the
Plan. The employees selected by the CEO will become participants in the Plan
(the "Participants") only upon approval by the Compensation Committee of the
Board of Directors of the Company (the "Compensation Committee").

         Section 2. Incentive Awards. Each Participant shall be awarded a number
of Company common stock units (collectively, the units are referred to herein as
the "Award") subject to the conditions provided herein, and as determined by the
Compensation Committee. The Award shall be granted to the Participant upon the
approval by the Compensation Committee on the date of the Award (the "Award
Date"), provided that the Award shall be held in escrow by the Company until
such time as the terms, conditions and restrictions applicable to the Award are
satisfied.

         Section 3. Performance Condition of the Award.

                  (a) The Award shall become payable only if:

                           (i)      The average After-Tax Margin per Unit
                                    Produced, calculated in accordance with
                                    Section 4(a), equals or exceeds the target
                                    amount set forth in Exhibit A during any
                                    consecutive six month period prior to the
                                    date specified in Section 4(b), and

                           (ii)     The After-Tax Margin per Unit Produced in
                                    each of the last three months of such six
                                    month period exceeds the target amount set
                                    forth in Exhibit A (collectively, the
                                    "Performance Condition").

                  (b) In the event of achievement of the Performance Condition,
subject to the terms of the Plan, a Participant shall be entitled to receive an
amount of cash equal to the value of the Award on the date the Performance
Condition is achieved. For this purpose, the value of each unit within an Award
shall be equal to the closing price of the Company's common stock on the NYSE
for the day on which the value of the Award is to be determined.

<PAGE>   2

         Section 4. Calculation of the Performance Measure and Forfeiture.

                  (a) The Company's Vice President and Controller for the
Production Group ("VP-Controller") shall submit on a quarterly basis, after-tax
margin per unit produced ("After-Tax Margin per Unit Produced") to the Company's
Chief Financial Officer ("CFO"), calculated as Revenue per unit minus Expenses
per unit, derived as set forth in Exhibit A. The VP-Controller will have
responsibility for calculating the After-Tax Margin per Unit Produced, subject
to the CFO's approval of both the methodology and calculation. The average
After-Tax Margin per Unit Produced for any six month period shall be equal to
the sum of the After-Tax Margin per Unit Produced for each of the months in the
period, divided by six.

                  (b) A Participant's Award shall be forfeited if the
Performance Condition is not satisfied on or before January 1, 2004.

                  (c) A Participant's Award shall be forfeited if, prior to the
satisfaction of the Performance Condition, the Participant's employment with the
Company is terminated voluntarily or involuntarily for any reason; provided,
however, that a Participant's Award shall not be forfeited if, at any time
within 24 months following a Change in Control of the Company (as defined in the
Company's Deferred Compensation Plan), the Company terminates the Participant's
employment for reasons other than for Cause (as defined in Section 11) or,
during the same period, Participant terminates employment with the Company for
Good Reason (as defined in Section 10).

         Section 5. Dividends and Adjustments. If a dividend or other
distribution shall be declared upon the Company's common stock payable in shares
of the common stock, the number of units expressed in terms of shares of the
common stock shall be adjusted by adding thereto the number of shares of the
common stock which would have been distributable thereon if such units had been
outstanding (as shares of common stock) on the date fixed for determining the
shareholders entitled to receive such stock dividend or distribution. Additional
units so distributed with respect to any units held in escrow or in the
Company's possession shall also be held by the Company in escrow or in its
possession and shall be subject to the same restrictions as are applicable to
the units on which they were distributed. If the outstanding shares of the
Company's common stock shall be changed into or exchangeable for a different
number or kind of shares of stock or other securities of the Company or another
corporation, or cash or other property, whether through reorganization,
reclassification, recapitalization, stock split-up, combination of shares,
merger or consolidation, then there shall be substituted for each unit expressed
in terms of shares of the common stock, the number and kind of replacement
units, expressed in shares of stock or other securities or cash or other
property into which each outstanding share of the common stock shall be so
changed or for which each such share shall be exchangeable. Upon such event, the
value of the units constituting the Award shall equal the closing price of such
common stock on the principal market on which such common stock is traded and
the Award shall continue to be subject to the terms of the Plan. Unless
otherwise determined by the Committee in its discretion, any such replacement
units, into or for which the units held in escrow or in the Company's possession
shall be changed or exchangeable in any such transaction shall also be held by
the Company in escrow or in its possession and shall be subject to the same
restrictions as are applicable to the units in respect of which such replacement
units were issued or distributed.

         Section 6. Distribution. Upon notification from the Company of
participation in the Plan, each Participant must make a written election as to
the time and form in which his or her Award will be paid as provided in this
Section 6. This election must be made on or before February 1, 2001, for those
individuals who are Participants on the effective date of the Plan, or not more
than thirty (30) days after the date of becoming a Participant, in the case of
other individuals.

                                        2
<PAGE>   3

                  (a) A Participant may elect to have the payment of his or her
Award deferred and paid in such form as provided in accordance with the
Company's Deferred Compensation Plan; provided, however, that no payment shall
be made pursuant to the Award prior to achievement of the Performance Condition.
The Participant's election as to when payment of the Award will commence shall
be irrevocable.

                  (b) If a Participant has elected to receive payment of his or
her Award, or any portion thereof, at a time later than the date when the
Performance Condition is achieved, then the units comprising the Award, to the
extent unpaid, shall be credited to and maintained in accordance with the terms
of the Company's Deferred Compensation Plan as then in effect. Participant shall
be subject to the terms of that plan, as then in effect, with respect to such
deferred amount and the allocation of deferred amounts.

                  (c) Notwithstanding any election by a Participant to receive
the payment of his or her Award at a specified date on which he or she is still
employed by the Company, the Award shall be paid to the Participant in such case
only to the extent that the deductibility of such payment to the Company is not
limited by reason of Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Code"). In the event that the payment of all or a part of the
Award exceeds the Code Section 162(m) limit, the amount in excess of the limit
shall be considered a required deferral and be credited to the Company's
Deferred Compensation Plan as described in Section 6(b) and payment shall
automatically be deferred to the next subsequent year in which it can be paid to
the Participant without exceeding the Code Section 162(m) limit.

                  (d) Subject to Section 6(c), a Participant's Award under this
Plan shall be paid to the Participant within sixty (60) days following
determination by the Company of achievement of the Performance Condition or, if
deferred, upon the date or dates specified in the Company's Deferred
Compensation Plan. The Participant shall receive payment for all Awards in cash
and shall have no right to receive any distribution of Company stock.

                  (e) In the event of the Participant's death, any vested
payments otherwise due to the Participant shall be paid to the Participant's
beneficiary, as listed on the most recent election form which is delivered to
the Company, upon the date or dates specified in the Company's Deferred
Compensation Plan.

         Section 7. Nature of Plan. The Plan constitutes a mere promise by the
Company to make benefit payments in the future. The Company's obligations under
the Plan shall be unfunded and unsecured promises to pay. The Company shall not
be obligated under any circumstance to fund its financial obligations under the
Plan. The Company may, in its discretion, set aside funds in a trust or other
vehicle, subject to the claims of its creditors, in order to assist it in
meeting its obligations under the Plan, if such arrangement will not cause the
Plan to be considered a funded deferred compensation plan. To the extent that
any Participant or beneficiary or other person acquires a right to receive
payments under the Plan, such right shall be no greater than the right, and each
Participant and beneficiary shall at all times have the status, of a general
unsecured creditor of the Company.

         Section 8. Nonassignment. A Participant shall have no right to sell,
exchange, transfer, pledge, assign or otherwise alienate or hypothecate
(collectively, "Transfer") an Award in any manner, including any Transfer for
cash, stock or any other benefit, and any attempt to do so shall be void.

         Section 9. Change in Control. Upon a Change in Control, as then defined
in the Company's Deferred Compensation Plan, the value of all of the outstanding
Awards granted to Participants pursuant to the Plan on the date of the Change in
Control, assuming that (i) the Performance Condition for all such Awards is
achieved as of the date of the Change in Control,

                                       3
<PAGE>   4

and (ii) all Awards are payable as of the date of the Change in Control, based
upon the closing price of the Company's common stock on the NYSE on that day,
shall be credited to the Company's Deferred Compensation Plan solely for
purposes of determining the amount of funding required of any trust created
pursuant to the terms of such plan; provided, however, that no payment shall be
made pursuant to any Award under this Plan, the Company's Deferred Compensation
Plan or any trust created thereunder, prior to achievement of the Performance
Condition.

         Section 10. Good Reason for Termination. Solely for purposes of the
forfeiture provision of Section 4(c), a Participant shall have terminated
employment with the Company for "Good Reason" if any one of the following occurs
following a Change in Control:

                  (a) The removal of the Participant from the position he or she
held immediately prior to the Change in Control (other than by reason of death,
disability or for Cause);

                  (b) The assignment to the Participant of any duties materially
and adversely inconsistent with those performed by the Participant immediately
prior to the Change in Control or a substantial alteration in the nature or
status of the Participant's responsibilities, either of which renders the
Participant's position to be of less dignity, responsibility or scope;

                  (c) A reduction by the Company in the Participant's level of
overall compensation (including annual incentive opportunity at target award
levels) as in effect on the effective date of this Plan or as the same may be
increased from time to time, except for proportional across-the-board reductions
similarly affecting all executives of the Company and all executives of any
person in control of the Company; provided, however, that the exception for
across-the-board reductions shall not apply in the event the Participant's
annual base salary is reduced by an amount equal to ten percent or more of the
Participant's annual base salary, as of the end of the calendar year immediately
preceding the year in which the Change in Control occurs, without the
Participant's consent;

                  (d) The failure to grant the Participant an annual salary
increase necessary to maintain such salary as reasonably comparable to the
salaries of senior executives holding positions equivalent to the Participant's
in the industry in which the Company's then principal business activity is
conducted;

                  (e) The Company requiring the Participant to be based anywhere
other than the Company's principal executive offices in the city in which the
Participant is principally located immediately prior to the Change in Control,
except for required travel on the Company's business to an extent substantially
consistent with the Participant's business travel obligations immediately prior
to the Change in Control; or

                  (f) Any material reduction by the Company of the benefits
enjoyed by the Participant under any of the Company's pension, retirement,
profit sharing, savings, life insurance, medical, health and accident,
disability or other employee benefit plans, programs or arrangements; the taking
of any action by the Company which would directly or indirectly materially
reduce any of such benefits or deprive the Participant of any material fringe
benefits or perquisites; or the failure by the Company to provide the
Participant with the number of paid vacation days to which he is entitled on the
basis of years of service with the Company in accordance with the Company's
normal vacation policy, provided that this paragraph (f) shall not apply to any
proportional across-the-board reduction or action similarly affecting all
executives of the Company and all executives of any person in control of the
Company.

                                       4
<PAGE>   5
         Section 11. Termination of Participant for Cause. Solely for purposes
of the forfeiture provision of Section 4(c), a Participant shall have a
termination of employment from the Company for "Cause" upon:

                  (a) The willful and continued failure by the Participant to
substantially perform his duties with the Company (other than (i) any such
failure resulting from the Participant's disability, or (ii) any such actual or
anticipated failure resulting from the Participant's termination of his
employment for Good Reason), after a written demand for substantial performance
is delivered to the Participant by the CEO of the Company which specifically
identifies the manner in which the CEO believes that the Participant has not
substantially performed his duties and which failure has not been cured within
thirty days after such written demand; or

                  (b) The willful and continued engaging by the Participant in
conduct which is demonstrably and materially injurious to the Company,
monetarily or otherwise.

         For purposes of this Section 11, no act, or failure to act on the
Participant's part shall be considered "willful" unless done, or omitted to be
done, by the Participant in bad faith and without reasonable belief that such
action or omission was in the best interest of the Company. Notwithstanding the
foregoing, the Participant shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to him a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board of Directors at a meeting of the Board of
Directors called and held for that purpose (after reasonable notice to the
Participant and an opportunity for the Participant, together with his counsel,
to be heard before the Board of Directors) finding that in the good faith
opinion of the Board of Directors the Participant is guilty of the conduct set
forth above and specifying the particulars thereof in detail.

         Section 12. Successors. The obligation of the Company under the Plan
shall be binding upon the successors and assigns of the Company.

         Section 13. Dispute Resolution. The Participant may make a claim to the
Compensation Committee with regard to a payment of benefits provided herein. If
the Compensation Committee receives a claim in writing, the Compensation
Committee must advise the Participant of its decision on the claim in writing in
a reasonable period of time after receipt of the claim, not to exceed 120 days.
The notice shall set forth the following information:

                  (a)      The specific basis for its decision;

                  (b)      Specific reference to pertinent Plan provisions on
                           which the decision is based;

                  (c)      A description of any additional material or
                           information necessary for the Participant to perfect
                           a claim and an explanation of why such material or
                           information is necessary; and

                  (d)      An explanation of the Plan's claim review procedure.

If the Participant does not receive a notice of decision within 120 days after
receipt of the claim, the claim will be deemed to have been denied. The
Participant may request a review of a decision (or deemed denial) by filing with
the Compensation Committee a written request for such review. The request must
be filed within 60 days after the notice of decision is received, or within 60
days after the denial is deemed to have occurred. The Participant may review
pertinent documents and submit issues and comments in writing within the same
60-day period. If a

                                       5
<PAGE>   6

request for review is filed, such review shall be made by the Compensation
Committee within 120 days after receipt of such request. Upon completion of the
review, the Participant shall be given written notice of the decision resulting
from such review, which notice shall include specific reasons for the decision
and specific references to the pertinent Plan provisions on which the decision
is based.

         In the event that the Participant continues to disagree with the
decision of the Compensation Committee, the Participant may seek to resolve the
dispute by referring the matter to an impartial arbitrator who shall be selected
from a list of names provided by the Federal Mediation and Conciliation Service
in Washington DC, provided that the costs for such proceeding shall be borne by
the party determined by the arbitrator.

         Section 14. Impact on Benefit Plans. Payments made under this Plan will
not be considered as earnings for purposes of the Company's Deferred
Compensation Plan.

         Section 15. No Contract of Employment. Neither the Plan nor any Award
shall be construed as a contract of employment for the Participant during the
term of this Plan or as a limitation on the right of the Company to discharge
any Participant with or without Cause.

         Section 16. Applicable Law. This Plan shall be governed by and
construed under the laws of the Commonwealth of Pennsylvania without regard to
its conflict of law provisions.

         Section 17. Severability. In the event that any one or more of the
provisions of this Plan shall be held to be invalid, illegal or unenforceable,
the validity, legality or enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.

         Section 18. Headings. The descriptive headings of the Sections of this
Plan are inserted for convenience of reference only and shall not constitute a
part of this Plan.

         Section 19. Amendment and Termination. This Plan may be amended by the
Company, in its sole discretion at any time by a written action authorized by
the Compensation Committee, except that no amendment shall adversely affect a
Participant's rights to an Award after the Award Date and no amendment may be
made following a Change in Control, as defined in the Company's Deferred
Compensation Plan. This Plan shall terminate upon the earlier of the
satisfaction of the Performance Condition or January 1, 2004.

                                       6

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