Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Chief Operating Officer Appointment
The Board of Directors (the "Board") of National Fuel Gas Company (the
"Company") has elected Ronald C. Kraemer Chief Operating Officer of the Company,
effective March 1, 2021. Mr. Kraemer, age 64, has served as President of
National Fuel Gas Supply Corporation ("Supply") since July 2019 and President of
Empire Pipeline, Inc. ("Empire") since August 2008. Mr. Kraemer will continue to
serve as President of Supply and Empire. In connection with Mr. Kraemer's
election as Chief Operating Officer of the Company, the Compensation Committee
of the Board (the "Compensation Committee") increased his annual salary to
$698,000, effective March 1, 2021.
Performance Shares with Relative Total Return on Capital Performance Goal
On December 10, 2020, the Compensation Committee of the Company made the
following grants of performance shares with a performance goal related to
relative total return on capital ("ROC Performance Shares") to the named
executive officers of the Company: D. P. Bauer, 29,557; K. M. Camiolo, 3,229; D.
L. DeCarolis, 7,274; J. P. McGinnis, 14,497; and J. R. Pustulka, 29,098. The
grants were made under the Company's 2010 Equity Compensation Plan (the "2010
Plan"). A brief description of the principal terms and conditions of the ROC
Performance Shares is provided below.
The number of ROC Performance Shares awarded to a named executive officer is
referred to as the officer's "ROC Target Opportunity." The performance cycle for
the ROC Performance Shares is October 1, 2020 through September 30, 2023. Each
ROC Performance Share will make the officer eligible to receive, no later than
March 15, 2024 but in any event as soon as practicable after the Compensation
Committee determines the extent to which the performance goal has been achieved,
up to two shares of common stock of the Company (or the equivalent value in
cash, as determined by the Committee), provided that the ROC Performance Shares
will not vest and will be forfeited to the extent the performance goal is not
achieved. No dividend equivalents will be provided in respect of the ROC
Performance Shares.
The performance goal for the October 1, 2020 to September 30, 2023 performance
cycle is the Company's total return on capital relative to the total return on
capital of other companies in a group selected by the Compensation Committee
(the "Report Group"). The Report Group consists of the following companies:
Atmos Energy Corporation
Cabot Oil & Gas Corporation
CNX Resources Corporation
EQT Corporation
Equitrans Midstream Corp.
MDU Resources Group, Inc.
National Fuel Gas Company
New Jersey Resources Corporation
Range Resources Corporation
SM Energy Company
Southwest Gas Holdings, Inc.
Southwestern Energy Company
Spire, Inc.
UGI Corporation
--------------------------------------------------------------------------------
Total return on capital for a given company means the average of the company's
returns on capital for each twelve month period corresponding to each of the
Company's fiscal years during the performance cycle, based on data reported for
the company in the Bloomberg database at the time of analysis (or, if the
Bloomberg database ceases to be available, such alternative publication or
service as the Compensation Committee shall designate).
The number of ROC Performance Shares that will vest and be paid will depend upon
the Company's performance relative to the Report Group, and not upon the
absolute level of return achieved by the Company. The Compensation Committee
established five percentile rankings that will determine the number of ROC
Performance Shares to vest and be paid: (i) less than 45th, (ii) 45th, (iii)
60th, (iv) 75th, and (v) 100th. These percentile rankings will result in vesting
and payment of a percentage of the ROC Target Opportunity, as follows: (i) 0%,
(ii) 50%, (iii) 100%, (iv) 150%, and (v) 200%, respectively. For example, if the
Company's performance were to place it at the 60th percentile of the Report
Group, then 100% of the ROC Target Opportunity would vest and be paid. For
performance between two established performance levels, the percentage of ROC
Performance Shares to vest and be paid will be determined by mathematical
interpolation. Notwithstanding the above, if the Company's total return on
capital is negative, then the percentage of the ROC Target Opportunity to be
paid will be capped at 100%. ROC Performance Shares that do not vest will be
automatically forfeited when the Compensation Committee makes its determination
as to the extent to which the performance goal has been achieved, but no later
than March 15, 2024.
Performance Shares with Relative Total Shareholder Return Performance Goal
On December 10, 2020, the Compensation Committee of the Company made the
following grants of performance shares with a performance goal related to
relative total shareholder return ("TSR Performance Shares") to the named
executive officers of the Company: D. P. Bauer, 29,557; K. M. Camiolo, 3,229; D.
L. DeCarolis, 7,274; J. P. McGinnis, 14,497; and J. R. Pustulka, 29,098. The
grants were made under the 2010 Plan. A brief description of the principal terms
and conditions of the TSR Performance Shares is provided below.
The number of TSR Performance Shares awarded to a named executive officer is
referred to as the officer's "TSR Target Opportunity." The performance cycle for
the TSR Performance Shares is October 1, 2020 through September 30, 2023. Each
TSR Performance Share will make the officer eligible to receive, no later than
March 15, 2024 but in any event as soon as practicable after the Compensation
Committee determines the extent to which the performance goal has been achieved,
up to two shares of common stock of the Company (or the equivalent value in
cash, as determined by the Committee), provided that the TSR Performance Shares
will not vest and will be forfeited to the extent the performance goal is not
achieved. No dividend equivalents will be provided in respect of the TSR
Performance Shares.
The performance goal for the October 1, 2020 to September 30, 2023 performance
cycle is the Company's three-year total shareholder return relative to the
three-year total shareholder return of the other companies in the Report Group.
Three-year total shareholder return for a given company will be based on the
data reported for that company (with the starting and ending stock prices over
the performance cycle calculated as the average closing stock price for the
prior calendar month and with dividends reinvested in that company's securities
at each ex-dividend date) in the Bloomberg database at the time of analysis (or,
if the Bloomberg database ceases to be available, such alternative publication
or service as the Compensation Committee shall designate).
--------------------------------------------------------------------------------
The number of TSR Performance Shares that will vest and be paid will depend upon
the Company's performance relative to the Report Group, and not upon the
absolute level of return achieved by the Company. The Compensation Committee
established five percentile rankings that will determine the number of TSR
Performance Shares to vest and be paid: (i) 30th or below, (ii) 40th, (iii)
50th, (iv) 70th, and (v) 90th or above. These percentile rankings will result in
vesting and payment of a percentage of the TSR Target Opportunity, as follows:
(i) 0%, (ii) 50%, (iii) 100%, (iv) 150%, and (v) 200%, respectively. For
example, if the Company's performance were to place it at the 50th percentile of
the Report Group, then 100% of the TSR Target Opportunity would vest and be
paid. For performance between two established performance levels, the percentage
of TSR Performance Shares to vest and be paid will be determined by mathematical
interpolation. Notwithstanding the above, if the Company's three-year total
shareholder return is negative, then the percentage of the TSR Target
Opportunity to be paid will be capped at 100%. TSR Performance Shares that do
not vest will be automatically forfeited when the Compensation Committee makes
its determination as to the extent to which the performance goal has been
achieved, but no later than March 15, 2024.
Restricted Stock Units
On December 10, 2020, the Compensation Committee of the Company made the
following grants of restricted stock units ("RSUs") to the following named
executive officers of the Company: D. P. Bauer, 29,566; K. M. Camiolo, 3,230; D.
L. DeCarolis, 7,276; and J. P. McGinnis, 14,501. The grants were made under the
2010 Plan. A brief description of the principal terms and conditions of the RSUs
is provided below.
An RSU is a right to receive one share of common stock of the Company (or the
equivalent value in cash or in a combination of shares and cash, as determined
by the Committee) at the end of a specified period of time (the "restricted
period"). Except as otherwise specified in the 2010 Plan or determined by the
Compensation Committee, the restricted period will lapse, and the RSUs will
vest, in three annual installments, commencing on December 10, 2021. If an
officer retires prior to a vesting date, the portion of the officer's RSU grant
associated with that vesting date and with all subsequent vesting dates will be
automatically forfeited. No dividend equivalents will be provided in respect of
the RSUs.
Annual At Risk Compensation Incentive Plan
On December 10, 2020, the Compensation Committee adopted specific written
performance goals for fiscal year 2021 under the 2012 Annual At Risk
. . .
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
On December 11, 2020, the Board of the Company amended the Company's By-Laws,
effective as of that date, to allow for a virtual Annual Meeting of
Stockholders.
--------------------------------------------------------------------------------
The foregoing description of the amendments to the By-Laws does not purport to
be complete and is qualified in its entirety by reference to the amended
By-Laws, a copy of which has been filed as an exhibit hereto and is expressly
incorporated by reference herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit 3.1 By-Laws of National Fuel Gas Company, as amended December 11,
2020
Exhibit 99 Press release furnished regarding management changes
Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses
NATIONAL FUEL GAS COMPANY 
