Document:

EX-10.1

Exhibit 10.1

Description of long-term performance incentives under the National Fuel Gas Company Performance
Incentive Program

On December 22, 2008, the Compensation Committee of the Board of Directors of National Fuel Gas
Company (the “Company”) approved long-term performance incentives under the National Fuel Gas
Company Performance Incentive Program (the “Program”) for a performance period of October 1, 2008
to September 30, 2011. The Compensation Committee established levels of performance at which 50%,
100%, 150% and 200% of the target incentive will be payable, as described below. For performance
levels between established levels, a portion of the target incentive will be payable as determined
by mathematical interpolation.

The performance condition for the October 1, 2008 to September 30, 2011 performance period is the
Company’s total return on capital as compared to the same metric for peer companies in the Natural
Gas Distribution and Integrated Natural Gas Companies group as calculated and reported in the
Monthly Utility Reports of AUS, Inc., a leading industry consultant (“AUS”). In determining the
Company’s total return on capital for purposes of this comparison, the Compensation Committee will
adjust the AUS calculation of the Company’s total return on capital so as to include any gains
realized by the Company on the sale of operations that were reported under Generally Accepted
Accounting Principles as discontinued operations.

Payment will be made in accordance with the Program if the Company achieves certain levels of
performance relative to the peer group. For example, if the Company achieves a rank, as a
percentile of the peer group, of 60%, then 100% of the target incentive will be paid. Other
performance levels may result in payments ranging from 0% to 200% of the target incentive.

For the October 1, 2008 to September 30, 2011 performance period, the Compensation Committee
approved the following target incentives for the following named executive officers of the Company:
D. F. Smith, $648,000; R. J. Tanski, $375,000; M. D. Cabell, $240,000; A. M. Cellino, $200,000 and
J. R. Pustulka, $105,000.EX-10.2

Exhibit 10.2

[Date]

[Name]

[Address]

[Address]

Dear [Name]:

     I am pleased to inform you that on [date] the Compensation Committee (“Committee”) of the
Board of Directors of National Fuel Gas Company (the “Company”) granted to you (the “Grantee”) a
stock appreciation right, under the National Fuel Gas Company 1997 Award and Option Plan, as
amended (the “Plan”), in respect of an aggregate of [___] shares of the Company’s Common Stock,
$1.00 par value (the “Common Stock”).

     Your new stock appreciation right is described in the balance of this letter agreement (“Award
Notice”). The Plan and the Committee’s Administrative Rules (“Rules”) govern the operation of the
Plan, as well as the terms and conditions of your stock appreciation right granted under the Plan,
and are incorporated herein by reference.

1. Performance Conditions

     The base price (“Base Price”) of your stock appreciation right is [$___] per share (which is
the Fair Market Value of the Common Stock on the date of grant). Absent a Change in Control of the
Company or Change in Ownership of the Company, the stock appreciation right granted hereby is
exercisable in accordance with the following schedule, subject to the performance conditions set
forth in the schedule:

[remainder of page intentionally left blank]

 

 

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[Date]

	 	 	 	 	 
	 	 	 	 	Incremental
	 	 	 	 	Number of
	 	 	 	 	Shares Subject
	Date	 	 	 	to SAR
	Exercisable	 	Performance Condition	 	Exercisable
	 
	 	 	 	 
	[one year after date
of grant]

	 	For fiscal [year],
with respect to the
Company’s Exploration
and Production
segment, increase
[certain oil and
natural gas]
production by [___%]
over the [prior fiscal
year]
	 	[1/3 of aggregate
number of shares
subject to SAR]
	 
	 	 	 	 
	[two years after date
of grant]

	 	For fiscal [year],
with respect to the
Company’s Exploration
and Production
segment, increase
[certain oil and
natural gas]
production by [___%]
over the [prior fiscal
year]
	 	[1/3 of aggregate
number of shares
subject to SAR]
	 
	 	 	 	 
	[three years after
date of grant]

	 	For fiscal [year],
with respect to the
Company’s Exploration
and Production
segment, increase
[certain oil and
natural gas]
production by [___%]
over the [prior fiscal
year]
	 	[1/3 of aggregate
number of shares
subject to SAR]

     In the event the performance condition for a given fiscal year is not met, the incremental
number of shares associated with such performance condition shall be automatically forfeited.

     In the event of a Change in Control of the Company or Change in Ownership of the Company, this
stock appreciation right shall become exercisable in accordance with the Plan, or its successor.
Once such right has become exercisable, this stock appreciation right may be exercised in whole at
any time and in part from time to time until the date of termination of the Grantee’s rights
hereunder; provided, that in no event shall this stock appreciation right be exercisable in whole
or in part after [ten years and one day after date of grant].

2. Restriction on Exercise

     Notwithstanding any other provision hereof, this stock appreciation right shall not be
exercised if at such time such exercise or the delivery of certificates representing shares of
Common Stock purchased pursuant hereto shall constitute a violation of any rule of the Company, any
provision of any applicable Federal or State statute, rule or regulation, or any rule or regulation
of any securities exchange on which the Common Stock may be listed.

3. Exercise

     This stock appreciation right may be exercised with respect to all or any part of the shares
of Common Stock then subject to such exercise in accordance with Section 1 pursuant to whatever
procedures may be adopted from time to time by the Company. Upon the exercise of this stock
appreciation right, in whole or in part, the Grantee shall be entitled to receive from the
Company a number of shares of Stock equal in value to the excess of the Fair Market Value (on the
date of exercise) of one share of Stock over the Base Price, multiplied by the number of shares in
respect

 

 

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of which the stock appreciation right is being exercised (the “Payout”). The number of
shares to be issued shall be calculated on the basis of the Fair Market Value of the shares on the
date of exercise, with any fractional share being payable in cash based on the Fair Market Value on
the date of exercise.

4. Termination of Employment

     In the event your employment with the Company or its Subsidiaries terminates, then, depending
upon the circumstances of the termination, this stock appreciation right may become exercisable
prior to the dates set forth in Section 1, may remain exercisable after your termination date, or
may be terminated, as set forth in the Plan and the Rules.

5. Adjustments in Common Stock

     In the event of a Common Stock dividend, Common Stock split, merger, consolidation,
reorganization, recapitalization or other change in the corporate structure, appropriate
adjustments shall be made by the Board or the Compensation Committee of the Board in the number of
shares, class or classes of securities and the base price per share applicable in respect to the
stock appreciation rights subject to this Agreement. The Board or the Compensation Committee
shall, in its discretion, determine the manner in which any adjustment pursuant to the immediately
preceding sentence shall be effected, with the purpose and intent of avoiding any diminution or
infringement of the Grantee’s rights hereunder by reason of any of the events referenced in such
sentence.

6. Non-Transferability of Stock Appreciation Right

     The Grantee has no right to assign or transfer this stock appreciation right, except by will,
by the laws of descent and distribution, or as otherwise permitted in the Plan or the Rules.
During the lifetime of the Grantee this stock appreciation right may be exercised only by him or
her (unless otherwise determined by the Board or the Committee).

7. Authority of Committee 

     The Committee has the authority to interpret the Plan and all stock appreciation rights
granted thereunder, to establish rules and regulations relating to the Plan and to make all other
determinations it believes necessary or advisable for the administration of the Plan. The scope of
the Committee’s authority is more fully described in the Plan. All determinations and actions of
the Committee are final, conclusive and binding on you.

8. Miscellaneous

     (a) This stock appreciation right (i) shall be binding upon and inure to the benefit of
the Company (and its successors and assigns) and you (and your heirs, legal representatives
and estate), and (ii) shall be governed by the laws of the State of New York, and any
applicable laws of the United States. No contract or right of employment shall be implied
by this stock appreciation right.

     (b) This stock appreciation right may be unilaterally amended or modified by the
Committee, as permitted by the Plan or the Rules, to the extent it deems appropriate, but
may not be amended or modified without your consent if such amendment or

 

 

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modification is
adverse to you. Except as otherwise provided in the preceding sentence, this stock
appreciation right may not be amended or modified, nor may any term or condition, or breach
of any term or condition, be waived, except in writing signed by the person or persons
sought to be bound by such amendment, modification or waiver. Any waiver of any term or
condition or breach thereof shall not be a waiver of any other term or condition, or of the
same term or condition for the future, or of any subsequent breach.

     (c) If this stock appreciation right is assumed or a new stock appreciation right is
substituted therefor in any corporate reorganization (including, but not limited to, any
transaction of the type referred to in Section 424(a) of the Internal Revenue Code of 1986,
as amended), employment by such assuming or substituting company or by a parent company or a
subsidiary thereof shall be considered for all purposes of this stock appreciation right to
be employment by the Company.

     (d) In consideration of the Grantee’s privilege to participate in the Plan, the Grantee
agrees (i) not to disclose any trade secrets of, or other confidential/restricted
information of the Company to any unauthorized party, (ii) not to make any unauthorized use
of such trade secrets or confidential or restricted information during his or her employment
with the Company or its Subsidiaries or after such employment is terminated, and (iii) not
to solicit any then current employees of the Company or any other subsidiaries of the
Company to join the Grantee at his or her new place of employment after his or her
employment with the Company or its Subsidiaries is terminated.

     (e) This Award Notice, together with the Plan and the Rules, constitutes the entire
agreement between the parties with respect to the subject matter hereof. You hereby
acknowledge that you have been provided with a copy of the Plan and the Rules, and
understand the terms and conditions of these documents and of this Award Notice. In the
event of any conflict between this Award Notice and the terms of the Plan and the Rules, the
Plan and the Rules will govern and control.

     (f) In the event of the invalidity of any part or provision of this agreement, such
invalidity shall not affect the enforceability of any other part or provision hereof.

9. Tax Withholding

     The Grantee agrees that upon exercise of the stock appreciation right evidenced hereby, in
whole or in part, any and all applicable income, employment or other tax withholding shall be
satisfied at the minimum required level using shares of Common Stock otherwise deliverable upon
exercise of such stock appreciation right. The number of shares to be withheld shall be determined
by the Company in accordance with the policies and procedures in effect from time to time under the
Plan applicable with respect to stock withholding.

10. Securities Law Requirements

     The Company shall not be required to issue shares upon the exercise of this stock appreciation
right unless and until (a) such shares have been duly listed upon each stock exchange
on which the Company’s Stock is then registered and (b) a registration statement under the
Securities Act of 1933 with respect to such shares is then effective. The Board may require the
Grantee to furnish to the Company, prior to the issuance of any shares of Common Stock in

 

 

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connection with the exercise of this stock appreciation right, an agreement, in such form as the
Board may from time to time deem appropriate, in which the Grantee represents that the shares
acquired by him upon such exercise are being acquired for investment and not with a view to the
sale or distribution thereof.

11. Stock Appreciation Right Subject to Plan and Rules

     This stock appreciation right shall be subject to all the terms and provisions of the Plan and
the Rules and the Grantee shall abide by and be bound by such terms and provisions and all rules,
regulations and determinations of the Board or the Committee now or hereafter made in connection
with the administration of the Plan. Capitalized terms not otherwise defined herein shall have the
meanings set forth for such terms in the Plan or the Rules.

12. American Jobs Creation Act

     In addition to amendments permitted by Section 8(b) above, amendments to this Agreement may be
made by the Company, without the Grantee’s consent, in order to ensure compliance with the American
Jobs Creation Act of 2004. And, further, amendments may be made to the Plan to ensure such
compliance, which amendments may impact this Agreement.

     If the foregoing is acceptable to you, kindly acknowledge your acceptance by signing both
originals of this letter and returning one to [Secretary of the Company].

	 	 	 	 	 
	 	Very truly yours,

NATIONAL FUEL GAS COMPANY

 	 
	 	By:  	 	 
	 	 	     [Name] 	 
	 	 	     [Title] 	 
	 

AGREED TO AND ACCEPTED

this ___day of                     , ___

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Grantee

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