National will comply with the applicable requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the repurchase of the notes as a result of a change of control triggering event. To the extent that the provisions of any securities laws or regulations conflict with the change of control offer provisions of the notes,
National will comply with those securities laws and regulations and will not be deemed to have breached its obligations under the change of control offer provisions of the notes by virtue of any such conflict.
For purposes of the change of control offer provisions of the notes, the following terms will be applicable:
change of control
means the occurrence of any of the following: (1) the direct or indirect sale, lease,
transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or more series of related transactions, of all or substantially all of Nationals assets and the assets of Nationals subsidiaries, taken as a
whole, to any person, other than National or one of Nationals subsidiaries; (2) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any person becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of Nationals outstanding voting stock or other voting stock into which Nationals voting stock is reclassified, consolidated,
exchanged or changed, measured by voting power rather than number of shares; (3) National consolidates with, or merges with or into, any person, or any person consolidates with, or merges with or into, National, in any such event pursuant to a
transaction in which any of Nationals outstanding voting stock or the voting stock of such other person is converted into or exchanged for cash, securities or other property, other than any such transaction where the shares of Nationals
voting stock outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, a majority of the voting stock of the surviving person or any direct or indirect parent company of the surviving person, measured by
voting power rather than number of shares, immediately after giving effect to such transaction; (4) the first day on which a majority of the members of Nationals Board of Directors are not continuing directors; or (5) the adoption of a plan
relating to Nationals liquidation or dissolution.
The term
person
, as used in this definition, has the meaning given thereto in Section 13(d)(3) of the
Exchange Act.
change of control triggering event
means the occurrence of both a change of control and a rating event.
continuing directors
means, as of any date of determination, any member of Nationals Board of
Directors who (1) was a member of such Board of Directors on the date the notes were issued or (2) was nominated for election, elected or appointed to such Board of Directors with the approval of a majority of the continuing directors who were
members of such Board of Directors at the time of such nomination, election or appointment (either by a specific vote or by approval of Nationals proxy statement in which such member was named as a nominee for election as a director).
Fitch
means Fitch Ratings and its successors.
investment grade rating
means a rating equal to or higher than BBB- (or the equivalent) by Fitch, Baa3 (or
the equivalent) by Moodys and BBB- (or the equivalent) by S&P, and the equivalent investment grade credit rating from any replacement rating agency or rating agencies selected by National.
Moodys
means Moodys Investors Service, Inc. and its successors.
rating agencies
means (1) each of Fitch, Moodys and S&P and (2) if any of Fitch, Moodys or
S&P ceases to rate the notes or fails to make a rating of the notes publicly available for reasons outside of Nationals control, a nationally recognized statistical rating organization within the meaning of Rule
S-15
15c3-1(c)(2)(vi)(F) under the Exchange Act selected by National (as certified by a resolution of Nationals Board of Directors) as a replacement agency for Fitch, Moodys or S&P, or all of them, as the case
may be.
rating event
means the rating on the notes is lowered by at least two of the three rating agencies and the
notes are rated below an investment grade rating by at least two of the three rating agencies, in any case on any day during the period (which period will be extended so long as the rating of the notes is under publicly announced consideration for a
possible downgrade by any of the rating agencies) commencing 60 days prior to the first public notice of the occurrence of a change of control or Nationals intention to effect a change of control and ending 60 days following consummation of
such change of control.
S&P
means Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and its successors.
voting stock
means, with respect to any specified person (as that term is used in Section
13(d)(3) of the Exchange Act) as of any date, the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.
Unless we default in the change of control payment, on and after the change of control payment date, interest will cease to accrue on the notes or portions of the notes tendered for repurchase
pursuant to the change of control offer.
The definition of change of control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of all or substantially all of
Nationals assets and the assets of Nationals subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase substantially all there is no precise established definition of the phrase under
applicable law. Accordingly, the ability of a holder of notes to require National to repurchase its notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of Nationals assets and those of Nationals
subsidiaries taken as a whole to another person or group may be uncertain.
Book-Entry Only Issuance--The Depository Trust Company
DTC will act as the initial securities depository for the notes. The notes will be issued only as fully registered securities registered in the name of Cede & Co., DTCs partnership
nominee, or such other name as may be requested by an authorized representative of DTC. One or more fully registered global note certificates will be issued, representing in the aggregate the total principal amount of the notes, and will be
deposited with the trustee on behalf of DTC.
The following is based upon information furnished by DTC:
DTC is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal
Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934, as amended
(the 1934 Act). DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues and money market instruments from over 100 countries that DTCs participants
(Direct Participants) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and
pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (DTCC). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income
Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks,
trust companies and clearing
S-16
corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (Indirect Participants). DTC has Standard & Poors, a division of The McGraw
Hill Companies, Inc., highest rating: AAA. The DTC rules applicable to its Direct and Indirect Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org. The
contents of such websites do not constitute part of this Prospectus Supplement.
Purchases of notes under the DTC system must be made by or through Direct Participants, which will receive a credit for the notes on DTCs records. The ownership interest of each actual
purchaser of notes (Beneficial Owner) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchases. Beneficial Owners are, however,
expected to receive written confirmations providing details of the transactions, as well as periodic statements of their holdings, from the Direct or Indirect Participants through which the Beneficial Owners purchased notes. Transfers of ownership
interests in the notes are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in notes,
except in the event that use of the book-entry system for the notes is discontinued.
To facilitate subsequent transfers, all notes deposited by Direct Participants with DTC are registered in the name of DTCs partnership nominee, Cede & Co., or such other name as may
be requested by an authorized representative of DTC. The deposit of notes with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any changes in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the notes. DTCs records reflect only the identity of the Direct Participants to whose accounts such notes are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.
Redemption notices shall be sent to DTC. If less than all of the notes are being redeemed, DTCs practice is to determine by lot the amount of interest of each Direct Participant in such
notes to be redeemed.
Although voting with respect to the notes is limited, in those cases where a vote is required, neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to
the notes unless authorized by a Direct Participant in accordance with DTCs procedures. Under its usual procedures, DTC mails an Omnibus Proxy to National as soon as possible after the record date. The Omnibus Proxy assigns Cede &
Co.s consenting or voting rights to those Direct Participants to whose accounts notes are credited on the record date (identified in a listing attached to the Omnibus Proxy).
Payments on the notes will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTCs practice is to credit Direct
Participants accounts upon DTCs receipt of funds and corresponding detail information from National or the trustee on the relevant payment date in accordance with their respective holdings shown on DTCs records. Payments by Direct
or Indirect Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the account of customers registered in street name, and will be the responsibility
of such Direct or Indirect Participant and not of DTC or the Company, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment to Cede & Co. (or such other nominee as may be requested by an authorized
representative of DTC) is the responsibility of the Company, disbursement of such payments to Direct Participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of Direct and Indirect
Participants.
S-17
Except as provided herein, a Beneficial Owner of a global note will not be entitled to receive physical delivery of notes. Accordingly, each Beneficial Owner must rely on the procedures of DTC
to exercise any rights under the notes. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of securities in definitive form. Such laws may impair the ability to transfer beneficial interests in a
global note.
DTC may discontinue providing its services as securities depository with respect to the notes at any time by giving reasonable notice to the Company. Under such circumstances, in the event that
a successor securities depository is not obtained, certificates for the notes will be required to be printed and delivered to the holders of record. Additionally, the Company may decide to discontinue use of the system of book-entry transfers
through DTC (or a successor securities depository) with respect to the notes. The Company understands, however, that under current industry practices, DTC would notify its Direct and Indirect Participants of the Companys decision, but will
only withdraw beneficial interests from a global note at the request of each Direct or Indirect Participant. In that event, certificates for the notes will be printed and delivered to the applicable Direct or Indirect Participant.
The information in this section concerning DTC and DTCs book-entry system has been obtained from sources that National believes to be reliable, but neither National nor any underwriter
takes any responsibility for the accuracy thereof. National has no responsibility for the performance by DTC or its Direct or Indirect Participants of their respective obligations as described herein or under the rules and procedures governing their
respective operations.
CERTAIN U.S. FEDERAL TAX CONSIDERATIONS FOR U.S. HOLDERS
The following discussion summarizes certain material U.S. federal income tax consequences to U.S. Holders (as defined below) of the purchase, ownership and disposition of the notes. It is
included herein for general information only and does not address all tax considerations that may be relevant to investors in the notes in light of their personal investment circumstances or that may be relevant to certain types of investors subject
to special treatment under U.S. income tax laws (for example, financial institutions, tax-exempt organizations, insurance companies, real estate investment trusts, regulated investment companies, persons that are broker-dealers, traders in
securities who elect the mark-to-market method of accounting for their securities, U.S. Holders (as defined below) that have a functional currency other than the U.S. dollar, foreign persons and entities, corporations that accumulate earnings to
avoid U.S. federal income tax, investors in partnerships or other pass-through entities
or persons holding the Notes as part of a straddle, hedge,
conversion transaction or other integrated transaction). The discussion set forth below is limited to U.S. Holders (as defined below) who purchase the notes for cash at the initial issue price (i.e., the first price to the
public, excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers, at which a substantial amount of the notes is sold for money) and who hold the notes as capital
assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the Code).
In addition, this discussion does not address the tax consequences to non-U.S. persons, or the effect of federal alternative minimum tax, gift or estate tax laws, or any state, local or foreign
tax laws. Persons considering the purchase, ownership or disposition of the notes should consult their own tax advisors concerning the U.S. federal income tax consequences in light of their particular situations as well as any consequences arising
under the laws of any other taxing jurisdiction. Furthermore, the discussion below is based upon provisions of the Code, the legislative history thereof, U.S. Treasury regulations promulgated thereunder and administrative rulings and judicial
decisions in effect as of the date hereof. Such authorities may be repealed, revoked or modified (including changes in effective dates, and possibly with retroactive effect) so as to result in U.S. federal income tax consequences different from
those discussed below.
For purposes of the following discussion, the term U.S. Holder means a beneficial owner of a note that is for U.S. federal income tax purposes:
S-18
-
an individual citizen or resident of the United States;
-
a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state
thereof or the District of Columbia;
-
an estate, the income of which is subject to U.S. federal income tax regardless of source; or
-
a trust, if (a) a court within the United States is able to exercise primary supervision over administration of the trust and one or more United States persons have authority
to control all substantial decisions of the trust or (b) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a domestic
trust.
If a partnership or an entity treated as a partnership for U.S. federal income tax purposes owns any of the notes, the tax treatment of a partner or an equity interest owner of such other
entity will generally depend upon the status of the person and the activities of the partnership or other entity treated as a partnership. Partnerships and other entities treated as partnerships for U.S. federal income tax purposes, and partners or
other equity interest owners in such entities, should consult their own tax advisors.
Payments of Interest
Subject to the discussion below under Additional Payments, payments of stated interest on the notes generally will be taxable to a U.S. Holder as ordinary interest income at the
time such payments are received or accrued in accordance with the U.S. Holder's method of accounting for U.S. federal income tax purposes.
Additional Payments
In certain circumstances (see Description of the Notes Optional Redemption and Description of the Notes Change of Control Offer), National may be obligated
to pay amounts in excess of stated interest or principal on the notes. The obligation to make such payments may implicate the provisions of U.S. Treasury regulations relating to contingent payment debt instruments. If the notes were
deemed to be contingent payment debt instruments, a U.S. Holder might be required to accrue income on the holder's notes in excess of stated interest, and to treat as ordinary income, rather than capital gain, any income realized on the taxable
disposition of a note before the resolution of the contingencies. According to current U.S. Treasury regulations, the possibility that any such payments in excess of stated interest or principal will be made will not cause the notes to be treated as
contingent payment debt instruments if, as of the date the notes were issued, there is only a remote chance that such payments will be made, the amount of such payments is incidental or certain other exceptions apply. National believes that the
potential or actual payment of these amounts will not cause the notes to be treated as contingent payment debt instruments. National's determination is binding on a U.S. Holder unless such holder discloses its contrary position in the manner
required by applicable U.S. Treasury regulations. National's determination is not, however, binding on the Internal Revenue Service (the IRS), and if the IRS were to challenge this determination, the tax consequences to a holder could
differ materially and adversely from those discussed herein. The remainder of this discussion assumes that the notes will not be treated as contingent payment debt instruments. Purchasers of notes are advised to consult their own advisors regarding
the possible application of the contingent payment debt instrument rules to the notes.
Sale, Redemption or Other Taxable Disposition of Notes
Upon the sale, redemption or other taxable disposition of a note, a U.S. Holder generally will recognize gain or loss equal to the difference between (1) the amount realized on such disposition
and (2) such holder's adjusted tax basis in the note. A holder's adjusted tax basis in the note generally will equal the amount paid for the note less any principal payments received by such holder. Gain or loss recognized by a
S-19
U.S. Holder in respect of the disposition generally will be capital gain or loss, and will be long-term capital gain or loss if the U.S. Holder has held the note for more than one year at the time of such disposition. A
U.S. Holder that is not a corporation may be entitled to preferential treatment for net long-term capital gains. The ability of a U.S. Holder to offset capital losses against ordinary income is limited. Notwithstanding the foregoing, any amounts
realized in connection with any sale, redemption or other taxable disposition with respect to accrued interest not previously includible in income will be treated as ordinary interest income.
Information Reporting and Backup Withholding
Payments of interest made by National on, or the proceeds of the sale or other disposition of, the notes will be subject to information reporting to the IRS unless the U.S. Holder is an exempt
recipient (such as a corporation) and may be subject to U.S. federal backup withholding, currently at a rate of 28%, if the recipient of the payment fails to supply an accurate taxpayer identification number or otherwise fails to comply with
applicable U.S. information reporting or certification requirements. Backup withholding does not represent an additional income tax. Any amount withheld under the backup withholding rules is allowable as a credit against the holders U.S.
federal income tax and may entitle the U.S. Holder to a refund, provided that the required information is timely furnished to the IRS.
THIS DISCUSSION OF U.S. FEDERAL INCOME TAX CONSIDERATIONS IS NOT INTENDED, AND SHOULD NOT BE CONSTRUED, TO BE TAX OR OTHER LEGAL ADVICE TO ANY PARTICULAR INVESTOR IN OR HOLDERS OF NOTES.
PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORS CONCERNING THE APPLICATION OF THE U.S. FEDERAL TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES ARISING UNDER THE LAWS OF ANY STATE, LOCAL OR FOREIGN TAXING
JURISDICTION AND THE POTENTIAL EFFECT OF CHANGES IN APPLICABLE TAX LAW.
S-20
UNDERWRITING
Subject to the terms and conditions set forth in the underwriting agreement dated the date of this prospectus supplement between National and the underwriters, for whom Banc of America
Securities LLC and J.P. Morgan Securities Inc. are acting as representatives, National has agreed to sell to the underwriters, and each of the underwriters has severally agreed to purchase from National the principal amount of the notes offered
hereby set forth opposite its name below:
|
|
Principal Amount
|
Underwriter
|
|
of Notes
|
|
Banc of America Securities LLC
|
|
$
|
84,375,000
|
|
J.P. Morgan Securities Inc
|
|
|
84,375,000
|
|
HSBC Securities (USA) Inc
|
|
|
21,250,000
|
|
Mitsubishi UFJ Securities (USA), Inc
|
|
|
21,250,000
|
|
PNC Capital Markets LLC
|
|
|
21,250,000
|
|
BNY Mellon Capital Markets, LLC
|
|
|
12,500,000
|
|
RBS Securities Inc
|
|
|
5,000,000
|
|
Total
|
|
$
|
250,000,000
|
|
The underwriting agreement provides that the obligations of the underwriters to pay for and accept delivery of the notes are subject to, among other things, the approval of certain legal
matters by their counsel and certain other conditions. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. The underwriters are obligated to take and pay for all the notes
if any are taken.
National and the underwriters have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act of 1933, or to contribute to payments National or
the underwriters may be required to make in respect of those liabilities.
Commissions and Discounts
Notes sold by the underwriters to the public will initially be offered at the public offering price set forth on the cover of this prospectus supplement, and to dealers at that price less a
concession not in excess of 0.40% of the principal amount of the notes. The underwriters may allow, and the dealers may reallow, a discount not in excess of 0.25% of the principal amount of the notes to other dealers. If all the notes are not sold
at the public offering price, the underwriters may change the public offering price and the other selling terms.
Nationals expenses in connection with the offer and sale of the notes, other than the underwriting discount, are estimated to be $600,000.
New Issue of Securities
The notes are a new issue of securities with no established trading market. National does not intend to apply for listing of the notes on any national securities exchange or for quotation of
the notes on any automated dealer quotation system. National has been advised by the underwriters that the underwriters intend to make a market in the notes but are not obligated to do so and may discontinue market-making at any time without notice.
National cannot assure the liquidity of the trading market for the notes or that an active public market for the notes will develop. If an active trading market for the notes does not develop, the market price and liquidity of the notes may be
adversely affected.
S-21
Price Stabilization and Short Positions
In connection with the offering, the underwriters may purchase and sell notes in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover
positions created by short sales. Short sales involve the sale by the underwriters of a greater number of notes than the underwriters are required to purchase in the offering. Stabilizing transactions consist of certain bids or purchases to peg, fix
or maintain the price of the notes.
These activities by the underwriters may stabilize, maintain or otherwise affect the market price of the notes. As a result, the price of the notes may be higher than the price that otherwise
might exist in the open market. If these activities are commenced, they may be discontinued by the underwriters at any time without notice. These transactions may be effected in the over-the-counter market or otherwise.
Neither National nor the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the
notes. In addition, neither National nor the underwriters make any representation that the underwriters will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice.
The underwriters have in the past engaged, and the underwriters and their respective affiliates expect in the future to engage, in transactions with, and have provided, and may in the future
provide, various financial advisory, commercial banking and investment banking services for, National and Nationals affiliates, for which they have in the past received, and will in the future receive, customary fees. The Bank of New York
Mellon, an affiliate of BNY Mellon Capital Markets, LLC, is the trustee under the indenture.
S-22
EXPERTS
The financial statements and financial statement schedule incorporated in the accompanying prospectus by reference to Nationals Current Report on Form 8-K dated March 17, 2009 and
managements assessment of the effectiveness of internal control over financial reporting (which is included in Managements Report on Internal Control over Financial Reporting) incorporated in the accompanying prospectus by reference to
Nationals Annual Report on Form 10-K for the year ended September 30, 2008 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm
as experts in auditing and accounting.
The information incorporated in this prospectus supplement and the accompanying prospectus by reference to Nationals Annual Report on Form 10-K for the year ended September 30, 2008,
relating to the oil and gas reserves of Seneca Resources Corporation, has been so incorporated in reliance on the audit report of Netherland, Sewell & Associates, Inc., an independent petroleum engineering firm, given on the authority of said
firm as experts in petroleum engineering.
LEGAL MATTERS
The validity of the notes and certain other matters will be passed upon for us by Dewey & LeBoeuf LLP, New York, New York and for the underwriters by Pillsbury Winthrop Shaw Pittman LLP,
New York, New York. However, all matters of New Jersey law, including the incorporation of National, will be passed upon only by Lowenstein Sandler PC, Roseland, New Jersey.
S-23
PROSPECTUS
National Fuel Gas Company
DEBT SECURITIES
COMMON STOCK
STOCK PURCHASE CONTRACTS
and
STOCK PURCHASE UNITS
National Fuel Gas Company may periodically sell any or all of the following securities to the public:
National
Fuel Gas Company will provide specific terms of its securities, including their
offering prices, in supplements to this prospectus. The supplements may also
add, update or change information contained in this prospectus. You should read
this prospectus and any supplements carefully before you invest.
National Fuel Gas Companys common stock is listed on the New York Stock Exchange and trades under the symbol NFG.
Investing
in the securities involves risks. See Risk Factors on page 2 for
information on certain risks related to the purchase of securities.
National
Fuel Gas Company may offer these securities directly or through underwriters,
agents or dealers. The supplements to this prospectus will describe the terms
of any particular plan of distribution, including any underwriting arrangements.
The Plan of Distribution section on page 18 of this prospectus also
provides more information on this topic.
National
Fuel Gas Companys principal executive offices are located at 6363 Main
St., Williamsville, New York 14221 and its telephone number is (716) 857-7000.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus
is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is March 17, 2009.
No person is authorized to give any information or to make any representations other than those contained or incorporated by reference in this prospectus or the accompanying prospectus supplement and, if given or made, such
information or representations must not be relied upon as having been authorized. This prospectus and the accompanying prospectus supplement do not constitute an offer to sell or the solicitation of an offer to buy any securities other than the
securities described in this prospectus and the accompanying prospectus supplement or an offer to sell or the solicitation of an offer to buy such securities in any circumstance in which such offer or solicitation is unlawful. Neither the delivery
of this prospectus or the accompanying prospectus supplement, nor any sale made under this prospectus or the accompanying prospectus supplement shall, under any circumstances, create any implication that there has been no change in the affairs of
National Fuel Gas Company since the date of this prospectus or the accompanying prospectus supplement or that the information contained or incorporated by reference in this prospectus or the accompanying prospectus supplement is correct as of any
time subsequent to the date of such information.
TABLE
OF CONTENTS
|
P
AGE
|
A
BOUT THIS
P
ROSPECTUS
|
2
|
R
ISK
F
ACTORS
|
2
|
N
ATIONAL
F
UEL
G
AS
C
OMPANY
|
3
|
W
HERE
Y
OU
C
AN
F
IND
M
ORE
I
NFORMATION
|
4
|
I
NCORPORATION BY
R
EFERENCE
|
4
|
R
ATIO OF
E
ARNINGS TO
F
IXED
C
HARGES
|
5
|
U
SE OF
P
ROCEEDS
|
5
|
D
ESCRIPTION OF
D
EBT
S
ECURITIES
|
6
|
D
ESCRIPTION OF
C
OMMON
S
TOCK
|
14
|
D
ESCRIPTION OF
S
TOCK
P
URCHASE
C
ONTRACTS AND
S
TOCK
P
URCHASE
U
NITS
|
17
|
P
LAN OF
D
ISTRIBUTION
|
18
|
E
XPERTS
|
19
|
L
EGAL
O
PINIONS
|
19
|
A
BOUT THIS
P
ROSPECTUS
This prospectus is part of a registration statement that National Fuel Gas Company (National) has filed with the Securities and Exchange Commission (the SEC) using a
shelf registration process. Under this shelf registration process, National may sell the securities or combinations of the securities described in this prospectus in one or more offerings. This prospectus provides you with a general
description of the securities that National may offer. Each time National sells securities, National will provide a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may also
add, update or change information contained in this prospectus. You should read both this prospectus and any prospectus supplement together with additional information described under the heading Where You Can Find More Information.
For more detailed information about the securities, you can read the exhibits to the registration statement. Those exhibits have been either filed with the registration statement or
incorporated by reference to earlier SEC filings listed in the registration statement.
References in this prospectus and the prospectus supplement to National are to National Fuel Gas Company, National Fuel Gas Company and its subsidiaries or National Fuel Gas
Companys subsidiaries as appropriate in the context of the disclosure.
R
ISK
F
ACTORS
In considering whether or not to purchase securities of National, you should carefully consider the risks described under Risk Factors in the prospectus supplement and in the
documents National incorporates by reference in this prospectus and the prospectus supplement, as well as the other information included or incorporated by reference in this prospectus and the prospectus supplement.
2
N
ATIONAL
F
UEL
G
AS
C
OMPANY
National, incorporated in 1902, is a holding company organized under the laws of New Jersey. National is engaged in the business of owning and holding securities issued by its
subsidiaries.
National and its subsidiaries comprise a diversified energy company consisting of four reportable business segments:
-
the Utility segment, which sells natural gas and provides natural gas transportation services through a local distribution system located in western New York and northwestern
Pennsylvania;
-
the Pipeline and Storage segment, which provides interstate natural gas transportation and storage services;
-
the Exploration and Production segment, which is engaged in the exploration for, and the development and purchase of, natural gas and oil reserves in California, the
Appalachian region of the United States, Wyoming and the Gulf Coast region of Texas, Louisiana and Alabama; and
-
the Energy Marketing segment, which markets natural gas to industrial, wholesale, commercial, public authority and residential customers primarily in western and central New
York and northwestern Pennsylvania.
Nationals other businesses are engaged in the marketing of timber, the operation of sawmills and the processing of timber, in the purchase, sale and transportation of landfill gas, and in
the development or operation of mid-range independent power production facilities and landfill gas electric generation facilities.
Nationals principal executive offices are located at 6363 Main Street, Williamsville, New York 14221 and its telephone number is (716) 857-7000.
3
W
HERE
Y
OU
C
AN
F
IND
M
ORE
I
NFORMATION
National files annual, quarterly and other reports, proxy statements and other information with the SEC. These SEC filings are available to the public over the Internet at the SECs
website at http://www.sec.gov. You may also read and copy any of these SEC filings at the SECs Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public
Reference Room. Information about National is also available on Nationals website, www.natfuel.com. Other than any SEC filings incorporated by reference in this prospectus, the information available on Nationals website is not part of
this prospectus or any prospectus supplement thereto.
I
NCORPORATION BY
R
EFERENCE
National discloses important information to you by referring you to documents that it has filed with the SEC that are incorporated by reference in this prospectus. The information
incorporated by reference is an important part of this prospectus. Information that National files in the future with the SEC will automatically update and supersede the information included in this prospectus and will also automatically update and
supersede any information previously incorporated by reference. National incorporates by reference the documents listed below and any future filings it makes with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 (the Exchange Act), excluding information deemed furnished and not filed, until this offering is terminated:
-
Annual Report on Form 10-K for the year ended September 30, 2008 (filing date of November 26, 2008);
-
Amended Annual Report on Form 10-K/A for the year ended September 30, 2008 (filing date of January 6, 2009);
-
Quarterly Report on Form 10-Q for the quarter ended December 31, 2008 (filing date of February 6, 2009); and
-
Current Reports on Form 8-K filed with the SEC on December 4, 2008, December 29, 2008, January 2, 2009, January 20, 2009 (to the extent filed under Item 8.01 thereof) and
March 17, 2009.
You may request a copy of these filings, at no cost, by writing or calling Paula M. Ciprich, Secretary, National Fuel Gas Company, 6363 Main Street, Williamsville, New York 14221; telephone number (716) 857-7548.
4
R
ATIO OF
E
ARNINGS TO
F
IXED
C
HARGES
The following table shows the ratio of Nationals earnings to fixed charges for the periods indicated:
Three Months
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Ended
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December 31, 2008
1
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Fiscal Years Ended September 30,
|
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2008
|
|
2007
|
|
2006
|
|
2005
|
|
2004
|
|
6.68
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|
5.31
|
|
4.64
|
|
3.66
|
|
3.50
|
For the purpose of calculating the ratio of earnings to fixed charges, Fixed Charges represent the sum of interest expense, excluding any amounts recorded in interest expense as
allowance for borrowed funds used in construction or amortization of loss on reacquired debt, and an estimate of the interest within rental expense. Earnings represents the amount resulting from adding the following items: pretax income
from continuing operations before adjustment for income or loss from equity investees (unconsolidated subsidiaries), fixed charges (as defined in the previous sentence), and distributed income of equity investees (unconsolidated subsidiaries).
1
Nationals earnings were insufficient to cover fixed charges by $75.3 million for the three months ended December 31, 2008.
U
SE OF
P
ROCEEDS
Except as may otherwise be set forth in an applicable prospectus supplement, the proceeds from the sale of these securities may be used to reduce short-term indebtedness, to redeem or discharge
indebtedness, to finance a portion of Nationals capital expenditures, for corporate development purposes, including, without limitation, acquisitions made by or on behalf of National or its subsidiaries, and for other general corporate
purposes.
5
D
ESCRIPTION OF
D
EBT
S
ECURITIES
General
The following description sets forth certain general terms and provisions of Nationals unsecured debt securities, consisting of debentures and medium-term notes, that National may offer
by this prospectus. National will describe the particular terms of the debt securities, and provisions that vary from those described below, in one or more prospectus supplements.
The debt securities will be Nationals direct unsecured general obligations. The debt securities will be senior debt securities. National may issue the debt securities from time to time in
one or more series, under an indenture, dated as of October 1, 1999, between National and The Bank of New York Mellon (formerly The Bank of New York), as trustee (the Trustee). This indenture, as it may be amended and supplemented from
time to time, is referred to in this prospectus as the Indenture.
The following descriptions of the debt securities and the Indenture are summaries and are qualified by reference to the Indenture. This summary does not contain a complete description of the
debt securities. You should read this summary together with the Indenture and the officers certificates or other documents establishing the debt securities for a complete understanding of the provisions that may be important to you. References
to certain sections of the Indenture are included in parentheses. Whenever particular provisions or defined terms in the Indenture are referred to under this Description of Debt Securities, such provisions or defined terms are
incorporated by reference herein. The Indenture is qualified under the Trust Indenture Act of 1939. You should refer to the Trust Indenture Act of 1939 for provisions that apply to the debt securities.
The debt securities will rank equally with all of Nationals other senior, unsecured and unsubordinated debt.
Because National is a holding company that conducts all of its operations through subsidiaries, holders of debt securities will generally have a position junior to claims of creditors
(including trade creditors of and holders of indebtedness issued by any such subsidiary) and preferred stockholders of the subsidiaries of National. No subsidiary currently has outstanding shares of preferred stock.
The prospectus supplement relating to any series of debt securities being offered will include specific terms relating to that offering. These terms will include any of the following terms that
apply to that series:
-
the title of the debt securities;
-
the total principal amount of the debt securities;
-
the date or dates on which the principal of the debt securities will be payable and how it will be paid;
-
the rate or rates at which the debt securities will bear interest, or how such rate or rates will be determined;
-
the date or dates from which interest on the debt securities will accrue, the interest payment dates on which interest will be paid, and the record dates for interest
payments;
-
any right to extend the interest payment periods for the debt securities and the duration of the extension;
-
the percentage, if less than 100%, of the principal amount of the debt securities that will be payable if the maturity of the debt securities is accelerated;
-
any date or dates on which, and the price or prices at which, the debt securities may be redeemed at the option of National and any restrictions on such
redemptions;
-
any sinking fund or other provisions or options held by holders of debt securities that would obligate National to repurchase or otherwise redeem the debt
securities;
6
-
any changes or additions to the events of default under the Indenture or changes or additions to the covenants under the Indenture;
-
if the debt securities will be issued in denominations other than $1,000;
-
if payments on the debt securities may be made in a currency or currencies other than United States dollars;
-
any convertible feature or options regarding the debt securities;
-
any rights or duties of another person to assume the obligations of National with respect to the debt securities;
-
any collateral, security, assurance or guarantee for the debt securities; and
-
any other terms of the debt securities not inconsistent with the terms of the Indenture.
(See Section 301.)
The Indenture does not limit the principal amount of debt securities that may be issued. The Indenture allows debt securities to be issued up to the principal amount that may be authorized by
National. Unless otherwise specified in the prospectus supplement, any limit upon the aggregate principal amount of the debt securities of any series may be increased without the consent of any holders and additional debt securities of such series
may be authenticated and delivered up to the limit on the aggregate principal amount authorized with respect to such series as so increased. Accordingly, the debt securities of any series may be increased on the same terms and conditions, except for
the issue price and the issue date, and with the same CUSIP numbers as the debt securities of such series initially offered.
Debt securities may be sold at a discount below their principal amount. United States federal income tax considerations applicable to debt securities sold at an original issue discount may be
described in the prospectus supplement. In addition, certain United States federal income tax or other considerations applicable to any debt securities which are denominated or payable in a currency or currency unit other than United States dollars
may be described in the prospectus supplement.
Except as may otherwise be described in a prospectus supplement, the covenants contained in the Indenture will not afford holders of debt securities protection in the event of a highly
leveraged or similar transaction involving National or in the event of a change in control.
Payment And Paying Agents
Except as may be provided in the prospectus supplement, interest, if any, on each debt security payable on each interest payment date will be paid to the person in whose name such debt security
is registered as of the close of business on the regular record date for the interest payment date. However, interest payable at maturity will be paid to the person to whom the principal is paid. If there has been a default in the payment of
interest on any debt security, the defaulted interest may be paid to the holder of such debt security as of the close of business on a date to be fixed by the Trustee, which will be between 10 and 15 days prior to the date proposed by National for
payment of such defaulted interest or in any other manner permitted by any securities exchange on which such debt security may be listed, if the Trustee finds it practicable. (See Section 307.)
Unless otherwise specified in the prospectus supplement, principal of, and premium, if any, and interest, if any, on the debt securities at maturity will be payable upon presentation of the
debt securities at the corporate trust office of the Trustee, in The City of New York, as paying agent. National may change the place of payment on the debt securities, may appoint one or more additional paying agents (including National) and may
remove any paying agent, all at the discretion of National. (See Section 602.)
Registration And Transfer
Unless otherwise specified in a prospectus supplement, the transfer of debt securities may be registered, and debt securities may be exchanged for other debt securities of the same series or
tranche, of authorized denominations and with the same terms and principal amount, at the corporate trust office of the Trustee in The City of New York. National may change the place for registration of transfer and exchange of the debt securities
and may designate additional places for such registration and exchange. Unless
7
otherwise provided in the prospectus supplement, no service charge will be made for any transfer or exchange of the debt securities. However, National may require payment to cover any tax or other governmental charge that
may be imposed. National will not be required to execute or to provide for the registration of transfer of, or the exchange of, (a) any debt security during a period of 15 days prior to giving any notice of redemption or (b) any debt security
selected for redemption except the unredeemed portion of any debt security being redeemed in part. (See Section 305.)
Satisfaction And Discharge
National will be discharged from its obligations on the debt securities of a particular series, or any portion of the principal amount of the debt securities of such series, if it irrevocably
deposits with the Trustee sufficient cash or government securities to pay the principal, or portion of principal, interest, any premium and any other sums when due on the debt securities of such series at their maturity, stated maturity date, or
redemption. (See Section 701.)
The Indenture will be deemed satisfied and discharged when no debt securities remain outstanding and when National has paid all other sums payable by National under the Indenture. (See Section
702.)
All moneys National pays to the Trustee or any paying agent on debt securities which remain unclaimed at the end of two years after payments have become due will be paid to or upon the order of
National. Thereafter, the holder of such debt security may look only to National for payment thereof. (See Section 603.)
Limitation On Liens On Subsidiary Capital Stock
The Indenture provides that, except as otherwise specified with respect to a particular series of debt securities, National will not pledge, mortgage, hypothecate or grant a security interest
in, or permit any pledge, mortgage, security interest or other lien upon, any capital stock of any of its majority-owned subsidiaries, which capital stock National now or hereafter directly owns, to secure any Indebtedness, as defined below, without
also securing the outstanding debt securities (so long as the other Indebtedness shall be so secured) equally and ratably, with or, at Nationals option, prior to, the other Indebtedness and any other Indebtedness similarly entitled to be so
secured.
This limitation does not apply to, or prevent the creation or existence of:
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(1)
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any pledge, mortgage, security interest, lien or encumbrance upon any such capital stock created at the time National acquires that capital stock or within 270 days after that time to secure the purchase
price for that capital stock so acquired;
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(2)
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any pledge, mortgage, security interest, lien or encumbrance upon any such capital stock existing at the time National acquires that capital stock, whether or not National assumes the secured obligations;
or
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(3)
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any extension, renewal, replacement or refunding of any pledge, mortgage, security interest, lien or encumbrance permitted by (1) and (2) above, or of any Indebtedness secured thereby; provided,
that,
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(a)
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the principal amount of Indebtedness so secured immediately after the extension, renewal, replacement or refunding may not exceed the principal amount of Indebtedness so secured immediately before the
extension, renewal, replacement or refunding; and
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(b)
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the extension, renewal, replacement or refunding of such pledge, mortgage, security interest, lien or encumbrance is limited to no more than the same proportion of all shares of capital stock as were covered
by the pledge, mortgage, security interest, lien or encumbrance that was extended, renewed, refunded or replaced; or
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(4)
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any judgment, levy, execution, attachment or other similar lien arising in connection with court proceedings, provided that:
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(a)
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the execution or enforcement of the lien is effectively stayed within 30 days after entry of the corresponding judgment, or the corresponding judgment has been discharged within such 30 day period, and the
claims secured thereby are being contested in good faith by appropriate proceedings timely commenced and diligently prosecuted; or
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8
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(b)
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the payment of the lien is covered in full by insurance and the insurance company has not denied or contested coverage thereof; or
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(c)
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so long as the lien is adequately bonded, any appropriate legal proceedings that may have been duly initiated for the review of the corresponding judgment, decree or order shall not have been fully
terminated or the period within which these proceedings may be initiated shall not have expired.
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Any pledge, mortgage, security interest, lien or encumbrance on any shares of the capital stock of any of the majority-owned subsidiaries of National, which shares of capital stock National now
or hereafter directly owns, to secure any Indebtedness other than as described in (1) through (4) above, is referred to in this prospectus as a Restricted Lien. This limitation on liens does not apply to the extent that National creates
any Restricted Liens to secure Indebtedness that, together with all other Indebtedness of National secured by Restricted Liens, does not at the time exceed 5% of Nationals Consolidated Capitalization. (See Section 608.)
For this purpose, Consolidated Capitalization means the sum of:
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(1)
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Consolidated Common Shareholders Equity;
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(2)
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Consolidated Indebtedness, exclusive of any that is due and payable within one year of the date the sum is determined; and, without duplication
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(3)
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any preference or preferred stock of National or any Consolidated Subsidiary, as defined below, which is subject to mandatory redemption or sinking fund provisions.
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The term Consolidated Common Shareholders Equity, as used above, means the total assets of National and its Consolidated Subsidiaries that would, in accordance with generally
accepted accounting principles in the United States, be classified on a balance sheet as assets, less: (a) all liabilities of National and its Consolidated Subsidiaries that would, in accordance with generally accepted accounting principles in the
United States, be classified on a balance sheet as liabilities; (b) minority interests owned by third parties in Consolidated Subsidiaries of National; and (c) preference or preferred stock of National and its Consolidated Subsidiaries only to the
extent any such preference or preferred stock is subject to mandatory redemption or sinking fund provisions.
The term Consolidated Indebtedness, as used above, means total indebtedness as shown on the consolidated balance sheet of National and its Consolidated Subsidiaries.
The term Consolidated Subsidiary, as used above, means at any date any majority-owned subsidiary the financial statements of which under generally accepted accounting principles in
the United States would be consolidated with those of National in its consolidated financial statements as of such date.
For purposes of the limitation described in the first paragraph under this heading, Indebtedness means:
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(1)
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all indebtedness created or assumed by National for the repayment of money borrowed;
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(2)
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all indebtedness for money borrowed secured by a lien upon capital stock owned by National and upon which indebtedness for money borrowed National customarily pays interest, although National has not assumed
or become liable for the payment of such indebtedness for money borrowed; and
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(3)
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all indebtedness of others for money borrowed which is guaranteed as to payment of principal by National or in effect guaranteed by National through a contingent agreement to purchase such indebtedness for
money borrowed, but excluding from this definition any other contingent obligation of National in respect of indebtedness for money borrowed or other obligations incurred by others.
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The foregoing limitation does not limit in any manner the ability of: (1) National to place liens on any of its assets other than the capital stock of directly held, majority-owned
subsidiaries; (2) National to cause the transfer of its assets or those of its subsidiaries, including the capital stock covered by the foregoing restrictions; or (3) any of the direct or indirect subsidiaries of National to place liens on any of
their assets.
9
In addition, the Indenture provides that if debentures issued by National under the indenture dated as of October 15, 1974, as supplemented (1974 Indenture), between National and The Bank of
New York Mellon, as trustee, in an aggregate principal amount in excess of 5% of Nationals Consolidated Capitalization become secured pursuant to the provisions of the 1974 Indenture, National will secure any outstanding debt securities
equally and ratably with those debentures. If National secures the outstanding debt securities, as provided in the prior sentence, then if and for so long as the aggregate principal amount of the debentures secured pursuant to the 1974 Indenture at
any time decreases and as a result constitutes 5% or less of Nationals Consolidated Capitalization, the outstanding debt securities will no longer be secured. (See Section 608.)
As of December 31, 2008, the Consolidated Capitalization of National was approximately $2,593,467,000.
Consolidation, Merger, And Sale Of Assets
Under the terms of the Indenture, National may not consolidate with or merge into any other entity or convey, transfer or lease its properties and assets substantially as an entirety to any
entity, unless:
-
the surviving or successor entity is organized and validly existing under the laws of any domestic jurisdiction and it expressly assumes Nationals obligations on all
debt securities and under the Indenture;
-
immediately after giving effect to the transaction, no event of default and no event which, after notice or lapse of time or both, would become an event of default shall have
occurred and be continuing; and
-
National shall have delivered to the Trustee an officers certificate and an opinion of counsel as to compliance with the foregoing.
The terms of the Indenture do not restrict National in a merger in which National is the surviving entity. (See Section 1101.)
Events Of Default
Event of default when used in the Indenture with respect to any series of debt securities, means any of the following:
-
failure to pay interest, if any, on any debt security of the applicable series for 30 days after it is due;
-
failure to pay the principal of or premium, if any, on any debt security of the applicable series when due (whether at maturity or upon earlier redemption);
-
failure to perform any other covenant in the Indenture, other than a covenant that does not relate to that series of debt securities, that continues for 90 days after
National receives written notice from the Trustee, or National and the Trustee receive a written notice from the holders of at least 33% in principal amount of the debt securities of such series; however, the Trustee or the Trustee and the holders of such principal amount of debt securities of this series can agree to an extension of the 90 day period and such an agreement to extend will be
automatically deemed to occur if National is diligently pursuing action to correct the default;
-
certain events in bankruptcy, insolvency or reorganization of National; or
-
any other event of default included in any supplemental indenture or officers certificate for a specific series of debt securities.
(See Section 801).
The Trustee may withhold notice to the holders of debt securities of any default, except default in the payment of principal, premium or interest, if it considers such withholding of notice to
be in the interests of the holders. An event of default for a particular series of debt securities does not necessarily constitute an event of default for any other series of debt securities issued under the Indenture.
10
Remedies
Acceleration of Maturity
If an event of default with respect to fewer than all the series of debt securities occurs and continues, either the Trustee or the holders of at least 33% in principal amount of the debt
securities of such series may declare the entire principal amount of all the debt securities of such series, together with accrued interest, to be due and payable immediately. However, if the event of default is applicable to all outstanding debt
securities under the Indenture, only the Trustee or holders of at least 33% in principal amount of all outstanding debt securities of all series, voting as one class, and not the holders of any one series, may make such a declaration of
acceleration.
At any time after a declaration of acceleration with respect to the debt securities of any series has been made and before a judgment or decree for payment of the money due has been obtained,
the event of default giving rise to such declaration of acceleration will be considered waived, and such declaration and its consequences will be considered rescinded and annulled, if:
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National has paid or deposited with the Trustee a sum sufficient to pay:
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-
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all overdue interest, if any, on all debt securities of the series;
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-
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the principal of and premium, if any, on any debt securities of the series which have otherwise become due and interest, if any, that is currently due;
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-
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interest, if any, on overdue interest; and
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-
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all amounts due to the Trustee under the Indenture; and
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any other event of default with respect to the debt securities of that series shall have been cured or waived as provided in the Indenture.
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There is no automatic acceleration, even in the event of bankruptcy, insolvency or reorganization of National. (See Section 802.)
Right to Direct Proceedings
Other than its duties in case of an event of default, the Trustee is not obligated to exercise any of its rights or powers under the Indenture at the request, order or direction of any of the
holders, unless the holders offer the Trustee a reasonable indemnity. (See Section 903.) If they provide a reasonable indemnity, the holders of a majority in principal amount of any series of debt securities will have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any power conferred upon the Trustee. However, if the event of default relates to more than one series, only the holders of a majority in aggregate
principal amount of all affected series will have the right to give this direction. (See Section 812). The Trustee is not obligated to comply with directions that conflict with law or other provisions of the Indenture.
Limitation on Right to Institute Proceedings
No holder of debt securities of any series will have any right to institute any proceeding under the Indenture, or to exercise any remedy under the Indenture, unless:
-
the holder has previously given to the Trustee written notice of a continuing event of default;
-
the holders of a majority in aggregate principal amount of the outstanding debt securities of all series in respect of which an event of default shall have occurred and be
continuing have made a written request to the Trustee, and have offered reasonable indemnity to the Trustee to institute proceedings; and
11
(See Section 807.)
No Impairment of Right to Receive Payment
However, such limitations do not apply to a suit by a holder of a debt security for payment of the principal of or premium, if any, or interest, if any, on such debt security on or after the
applicable due date. (See Section 808.)
Annual Notice to Trustee
National will provide to the Trustee an annual statement by an appropriate officer as to Nationals compliance with all conditions and covenants under the Indenture. (See Section 606.)
Modification and Waiver
National and the Trustee may enter into one or more supplemental indentures without the consent of any holder of debt securities for any of the following purposes:
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to evidence the assumption by any permitted successor of the covenants of National in the Indenture and in the debt securities;
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to add additional covenants of National or to surrender any right or power of National under the Indenture;
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to add additional events of default;
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to change, eliminate, or add any provision to the Indenture; provided, however, if the change, elimination, or addition will adversely affect the interests of the holders of debt securities of any series in
any material respect, such change, elimination, or addition will become effective only:
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-
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when the consent of the holders of debt securities of such series has been obtained in accordance with the Indenture; or
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-
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when no debt securities of the affected series remain outstanding under the Indenture;
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to provide collateral security for all but not part of the debt securities;
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to establish the form or terms of debt securities of any other series as permitted by the Indenture;
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to provide for the authentication and delivery of bearer securities and coupons attached thereto;
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to evidence and provide for the acceptance of appointment of a successor trustee;
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to provide for the procedures required for use of a noncertificated system of registration for the debt securities of all or any series;
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to change any place where principal, premium, if any, and interest shall be payable, debt securities may be surrendered for registration of transfer or exchange and notices to National may be served;
or
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12
(See Section 1201.)
The holders of at least a majority in aggregate principal amount of the debt securities of all series then outstanding may waive compliance by National with certain restrictive provisions of
the Indenture. (See Section 607.) The holders of not less than a majority in principal amount of the outstanding debt securities of any series may waive any past default under the Indenture with respect to that series, except a default in the
payment of principal, premium, if any, or interest and certain covenants and provisions of the Indenture that cannot be modified or be amended without the consent of the holder of each outstanding debt security of the series affected. (See Section
813.)
If the Trust Indenture Act of 1939 is amended after the date of the Indenture in such a way as to require changes to the Indenture, the Indenture will be deemed to be amended so as to conform
to such amendment of the Trust Indenture Act of 1939. National and the Trustee may, without the consent of any holders, enter into one or more supplemental indentures to evidence such an amendment. (See Section 1201.)
The consent of the holders of a majority in aggregate principal amount of the debt securities of all series then outstanding is required for all other modifications to the Indenture. However,
if less than all of the series of debt securities outstanding are directly affected by a proposed supplemental indenture, then the consent only of the holders of a majority in aggregate principal amount of all series that are directly affected will
be required. No such amendment or modification may:
-
change the stated maturity of the principal of, or any installment of principal of or interest on, any debt security, or reduce the principal amount of any debt security or
its rate of interest or change the method of calculating such interest rate or reduce any premium payable upon redemption, or change the currency in which payments are made, or impair the right to institute suit for the enforcement of any payment on or after the stated maturity of any debt security, without the consent of the holder;
-
reduce the percentage in principal amount of the outstanding debt securities of any series which consent is required for any supplemental indenture or any waiver of
compliance with a provision of the Indenture or any default thereunder and its consequences, or reduce the requirements for quorum or voting, without the consent of all the holders of the series; or
-
modify certain of the provisions of the Indenture relating to supplemental indentures, waivers of certain covenants and waivers of past defaults with respect to the debt
securities of any series, without the consent of the holder of each outstanding debt security affected thereby.
A supplemental indenture which changes the Indenture solely for the benefit of one or more particular series of debt securities, or modifies the rights of the holders of debt securities of one
or more series, will not affect the rights under the Indenture of the holders of the debt securities of any other series. (See Section 1202.)
The Indenture provides that debt securities owned by National or anyone else required to make payment on the debt securities shall be disregarded and considered not to be outstanding in
determining whether the required holders have given a request or consent. (See Section 101.)
National may fix in advance a record date to determine the required number of holders entitled to give any request, demand, authorization, direction, notice, consent, waiver or other such act
of the holders, but National shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other act of the holders may be given before or after such record date, but
only the holders of record at the close of business on that record date will be considered holders for the purposes of determining whether holders of the required percentage of the outstanding debt securities have authorized or agreed or consented
to such request, demand, authorization, direction, notice, consent, waiver or other act of the holders. For that purpose, the outstanding debt securities shall be computed as of the record date. Any request, demand, authorization, direction, notice,
consent, election, waiver or other act of a holder shall bind every future holder of the same debt securities and the holder of every debt security issued upon the registration of transfer of or in exchange of such debt securities. A transferee will
be bound by acts of the
13
Trustee or National taken in reliance thereon, whether or not notation of such action is made upon such debt security. (See Section 104.)
Resignation Of The Trustee
The Trustee may resign at any time by giving written notice to National or may be removed at any time by act of the holders of a majority in principal amount of all series of debt securities
then outstanding delivered to the Trustee and National. No resignation or removal of the Trustee and no appointment of a successor trustee will be effective until the acceptance of appointment by a successor trustee. So long as no event of default
or event which, after notice or lapse of time, or both, would become an event of default has occurred and is continuing and except with respect to a Trustee appointed by act of the holders, if National has delivered to the Trustee a resolution of
its Board of Directors appointing a successor trustee and such successor has accepted such appointment in accordance with the terms of the Indenture, the Trustee will be deemed to have resigned and the successor will be deemed to have been appointed
as trustee in accordance with the Indenture. (See Section 910.)
Notices
Notices to holders of debt securities will be given by mail to the addresses of such holders as they may appear in the security register therefor. (See Section 106.)
Title
National, the Trustee, and any agent of National or the Trustee, may treat the person in whose name debt securities are registered as the absolute owner thereof, whether or not such debt
securities may be overdue, for the purpose of making payments and for all other purposes irrespective of notice to the contrary. (See Section 308.)
Governing Law
The Indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York. (See Section 112.)
Regarding The Trustee
The Trustee will be The Bank of New York Mellon. In addition to acting as Trustee, The Bank of New York Mellon acts, and may act, as trustee under various indentures and trusts of National and
its affiliates.
D
ESCRIPTION OF
C
OMMON
S
TOCK
The following description of Nationals common stock is a summary and is qualified by reference to the terms and provisions of Nationals Restated Certificate of Incorporation, as
amended (Restated Certificate of Incorporation), its By-Laws, and the Amended and Restated Rights Agreement, dated as of December 4, 2008, between National and The Bank of New York Mellon, as rights agent (Rights Agreement), which are filed as
exhibits to the registration statement to which this prospectus relates and incorporated herein by reference. Reference is also made to the indenture dated as of October 15, 1974, as supplemented (1974 Indenture), between National Fuel and The Bank
of New York Mellon, as trustee. (The 1974 Indenture includes a limitation on the payment of dividends, as described below under Dividend Rights. The Companys other indenture, dated as of October 1, 1999, between National and The
Bank of New York Mellon, contains no such limitation.)
No shares of preferred stock of National are currently outstanding. However, the Board of Directors of National has the ability to issue one or more series of preferred stock from time to time.
The actual effect of the preferred stock upon the rights of the holders of Nationals common stock will not be known until Nationals Board of Directors determines the respective rights of the holders of one or more series of preferred
stock. Such effects, however, might include: (a) restrictions on dividends on Nationals common stock if dividends on the preferred stock are in arrears; (b) dilution of the voting power of Nationals common stock; (c) restrictions on the
rights of the holders of Nationals common stock to share in Nationals assets upon liquidation due to satisfaction of any liquidation preference granted to the preferred stock; and (d) dilution of rights of holders of Nationals
common stock to share in Nationals assets upon liquidation if the preferred stock is participating with respect to distributions upon such liquidation.
14
Dividend Rights
The holders of common stock are entitled to receive dividends as declared by the Board of Directors, out of funds legally available for the purpose and subject to a limitation in the 1974
Indenture. The 1974 Indenture prohibits the payment of cash dividends on, and the purchase or redemption of, common stock if the cumulative dividends on and amounts paid for purchase or redemption of common or preferred stock since December 31, 1967
exceed or would exceed consolidated net income available for dividends for that same period plus $10 million plus any additional amount authorized or approved, upon application of National, by the SEC. The amount available for the declaration
and payment of dividends on Nationals common stock pursuant to this restriction will be described in the applicable prospectus supplement.
The Board of Directors ability to declare dividends on common stock may also be limited by the rights and preferences of certain series of preferred stock, which may be issued from time
to time, and by the terms of instruments defining the rights of holders of outstanding indebtedness of National.
Voting Rights And Classification Of The Board Of Directors
The holders of common stock are entitled to one vote per share. The affirmative vote of the majority of the votes cast by the holders of the common stock is required for the merger or
consolidation of National or for the sale of substantially all of its assets. The Board of Directors is divided into three classes, each with, as nearly as possible, an equal number of directors.
Liquidation Rights
Upon any dissolution, liquidation or winding up of National, the holders of common stock are entitled to receive pro rata all of Nationals assets and funds remaining after payment of or
provision for creditors and subject to the rights and preferences of each series of preferred stock.
Preemptive Rights
Holders of common stock and any series of preferred stock that may be issued have no preemptive right to purchase or subscribe for any shares of capital stock of National.
Common Stock Purchase Rights
The holders of the common stock, including the common stock sold pursuant to this prospectus, have one right for each of their shares. Each right, which will initially be evidenced by the
common stock certificates representing the outstanding shares of common stock of National, entitles the holder to purchase one-half of one share of common stock at a purchase price of $75.00 per half share, being $150.00 per full share,
subject to adjustment (Purchase Price).
The rights become exercisable upon the occurrence of a distribution date. Subject to redemption or exchange of the rights, at any time following a distribution date, each holder of a right will
be entitled to receive, upon exercise of the right, common stock of National (or, under certain circumstances, other securities or assets of National) having a value equal to two times the amount paid to exercise the right. However, the rights are
subject to redemption or exchange by National prior to their exercise as described below.
A distribution date would occur upon the earlier of:
-
ten days after the public announcement that a person or group has acquired, or obtained the right to acquire, beneficial ownership of Nationals common stock or other
voting stock having 10% or more of the aggregate voting power of Nationals common stock and other voting stock, except in circumstances described below; and
-
ten business days after the commencement or announcement by a person or group of an intention to make a tender or exchange offer that would result in that person acquiring,
or obtaining the right to acquire, beneficial ownership of Nationals common stock or other voting stock having 10% or more of the total voting power of Nationals common stock and other voting stock.
15
Beneficial ownership of Nationals common stock includes, among other things, certain derivative or synthetic arrangements having characteristics of a long position in Nationals
common stock. In addition, the phrase "then outstanding," when used with reference to a persons beneficial ownership of securities of National, means the number of securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding which such person would be deemed to own beneficially under the Rights Agreement.
A distribution date would not occur where the acquisition described in the first bullet point above results from a reduction in the number of Nationals shares of voting stock outstanding
due to the repurchase of shares by National, unless and until the acquiring person or group, after becoming aware of its 10% stake, acquires any additional shares of Nationals then outstanding voting stock. Similarly, a distribution date would
not occur if Nationals Board of Directors determines that the person or group that acquired the 10% stake did so inadvertently and without any intention of changing or influencing control of National, and if that person or group, after being
advised of the Board of Directors determination, reduces its stake below 10% within a period of time set by the Board of Directors.
In certain situations after a person or group has acquired beneficial ownership of 10% or more of the total voting power of Nationals stock as described above, each holder of a right will
be entitled to receive, upon exercise of the right, common stock of the acquiring company having a value equal to two times the amount paid to exercise the right. These situations would arise if National is acquired in a merger or other business
combination or if 50% or more of Nationals assets or earning power are sold or transferred.
At any time prior to the end of business on the tenth day following the announcement that a person or group has acquired, or obtained the right to acquire, beneficial ownership of 10% or more
of the total voting power of National (except in the circumstances described above in which a distribution date would not occur), National may redeem the rights in whole, but not in part, at a price of $.005 per right, payable in shares of
common stock, other securities, cash or other assets. A decision to redeem the rights requires the vote of 75% of Nationals full Board of Directors. Also, at any time following the announcement that a person or group has acquired, or obtained
the right to acquire, beneficial ownership of 10% or more of the total voting power of National, 75% of Nationals full Board of Directors may vote to exchange the rights, in whole or in part, at an exchange rate of one share of common stock
per right, subject to certain adjustments. Notwithstanding the foregoing, the Board of Directors may not effect an exchange after a person or group has acquired, or obtained the right to acquire, beneficial ownership of 50% or more of the common
stock then outstanding.
After a distribution date, rights that are owned by an acquiring person will be null and void. Upon exercise of the rights, National may need additional regulatory approvals to satisfy the
requirements of the Rights Agreement. The rights will expire on July 31, 2018, unless they are exchanged or redeemed earlier than that date.
The rights have anti-takeover effects because they will cause substantial dilution of the common stock if a person attempts to acquire National on terms not approved by the Board of Directors.
Business Combinations
Nationals Restated Certificate of Incorporation provides that certain conditions must be met before the consummation of any merger or other business combination by National or any of its
subsidiaries with any stockholder who is directly or indirectly the beneficial owner of 5% or more of Nationals outstanding common stock (substantial stockholder) or with an affiliate of any substantial stockholder. The term substantial
stockholder does not include National, any of its subsidiaries, or any trustee holding common stock of National for the benefit of the employees of National or any of its subsidiaries pursuant to one or more employee benefit plans or arrangements.
The conditions, which are in addition to those otherwise required by law, prescribe the minimum amount per share that must be paid to holders of common stock and the form of consideration paid, and require that the holders of common stock be
furnished certain information about the business combination prior to voting on it. A business combination, as defined in the Restated Certificate of Incorporation, generally means any of the following transactions:
-
a merger, consolidation or share exchange;
-
a sale, lease, exchange or other disposition of any assets in exchange for property having a fair market value of more than $10 million, if determined to be a business
combination by certain directors of National in accordance with provisions of the Restated Certificate of Incorporation;
16
-
the issuance or transfer of securities in exchange for property having a fair market value of more than $10 million, if determined to be a business combination by certain
directors of National in accordance with provisions of the Restated Certificate of Incorporation;
-
the adoption of a plan of liquidation or dissolution of National; or
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any reclassification of securities, recapitalization or reorganization that has the effect of increasing the proportionate share of the outstanding shares of any class of
securities of National that is owned by any substantial stockholder or by any affiliate of a substantial stockholder.
The approval of at least three-fourths of the entire Board of Directors or, in the event that the Board of Directors consists of directors elected by the holders of preferred stock, the
approval of a majority of the entire Board, is required to amend or repeal the classified board or business combination provisions contained in the Restated Certificate of Incorporation.
Listing
The common stock is, and will be, listed on the New York Stock Exchange.
Transfer Agent And Registrar
The transfer agent and registrar for the common stock is BNY Mellon Shareowner Services.
D
ESCRIPTION OF
S
TOCK
P
URCHASE
C
ONTRACTS AND
S
TOCK
P
URCHASE
U
NITS
National may issue stock purchase contracts, including contracts that obligate holders to purchase from National, and National to sell to these holders, a specified number of shares of common
stock at a future date or dates. The consideration per share of common stock may be fixed at the time the stock purchase contracts are issued or may be determined by reference to a specific formula set forth in the stock purchase contracts. The
stock purchase contracts may be issued separately or as a part of stock purchase units consisting of (a) a stock purchase contract under which the holder, upon settlement, will purchase an indeterminate number of shares of common stock and (b) a
beneficial interest in debt securities, trust preferred securities, preferred stock or debt obligations from either National or third parties, including U.S. Treasury securities purchased with the proceeds from the sale of the stock purchase units.
Each beneficial interest will be pledged to secure the obligation of such holder to purchase such shares of common stock under the stock purchase contracts. The stock purchase contracts may require National to make periodic payments to the holders
of some or all of the stock purchase units or vice versa, and such payments may be unsecured or prefunded on some basis. The stock purchase contracts may require holders to secure their obligations under these stock purchase contracts in a specified
manner.
A prospectus supplement will describe the terms of any stock purchase contracts or stock purchase units being offered. The description in the prospectus supplement will not necessarily be
complete, and reference will be made to the stock purchase contracts. Some of the important United States federal income tax considerations applicable to the stock purchase units and stock purchase contracts will be discussed in the related
prospectus supplement.
17
P
LAN OF
D
ISTRIBUTION
National may periodically sell its securities in one or more of the following ways:
-
to underwriters or dealers for resale to the public or to institutional investors;
-
directly to the public or institutional investors; or
-
through agents to the public or to institutional investors.
The prospectus supplement will state the terms of the offering of the securities, including:
-
the name or names of any underwriters, dealers or agents;
-
the purchase price of such securities and the proceeds to be received by National;
-
any underwriting discounts, commissions or agency fees and other items constituting underwriters or agents compensation;
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any initial public offering price;
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any discounts or concessions allowed or reallowed or paid to dealers; and
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any securities exchanges on which the securities may be listed.
If National uses underwriters in the sale, the underwriters will acquire the securities for their own account and may resell them in one or more transactions, including:
Unless otherwise stated in a prospectus supplement, the obligations of the underwriters to purchase any securities will be conditioned on customary closing conditions and the underwriters will
be obligated to purchase all of such series of securities, if any are purchased.
If National uses dealers in the sale, the dealers will acquire the securities as principals and may resell them to the public at varying prices to be determined by the dealers at the time of
resale.
Unless otherwise stated in a prospectus supplement, any agent selling securities on Nationals behalf will be acting on a best efforts basis for the period of its appointment.
This prospectus may be delivered by underwriters and dealers in connection with short sales undertaken to hedge exposures under commitments to acquire the securities described in this
prospectus that may be issued on a delayed or contingent basis.
Underwriters, agents and dealers may be entitled under agreements entered into with National to indemnification by National against certain civil liabilities, including liabilities under the
Securities Act of 1933, or to contribution with respect to payments that the underwriters, agents or dealers may be required to make. Underwriters, agents and dealers may be customers of, engage in transactions with, or perform services for National
and its affiliates in the ordinary course of business.
Any securities offered by this prospectus, other than Nationals common stock, will be a new issue of securities and will have no established trading market. Nationals common stock
is listed on the New York Stock Exchange, and any shares of Nationals common stock sold will also be listed on the New York Stock Exchange, upon official notice of issuance. Any underwriters to whom securities are sold by National for public
offering and sale may make a market in the securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. Any of these securities, other than Nationals common stock, may or
may not be listed on a national securities exchange. National gives no assurance as to the liquidity of or the existence of any trading market for any of these securities, other than Nationals common stock.
18
E
XPERTS
The financial statements and financial statement schedule incorporated in this prospectus by reference to Nationals Current Report on Form 8-K dated March 17, 2009 and managements
assessment of the effectiveness of internal control over financial reporting (which is included in Managements Report on Internal Control over Financial Reporting) incorporated in this prospectus by reference to the Annual Report on Form 10-K
of National for the year ended September 30, 2008 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and
accounting.
The information incorporated in this prospectus by reference to Nationals Annual Report on Form 10-K for the year ended September 30, 2008, relating to the oil and gas reserves of Seneca
Resources Corporation, has been so incorporated in reliance on the audit report of Netherland, Sewell & Associates, Inc., an independent petroleum engineering firm, given on the authority of said firm as experts in petroleum engineering.
L
EGAL
O
PINIONS
The validity of the securities offered by this prospectus will be passed upon for National by Dewey & LeBoeuf LLP, New York, New York, and for the underwriters, dealers, or agents by
Pillsbury Winthrop Shaw Pittman LLP, New York, New York. However, all matters of New Jersey law, including the incorporation of National, will be passed upon by Lowenstein Sandler PC, Roseland, New Jersey.
19
$250,000,000
National Fuel Gas Company
8.75% Notes due 2019
PROSPECTUS SUPPLEMENT
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April 1, 2009
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Joint Book-Running Managers
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Banc of America Securities LLC
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J.P. Morgan
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Co-Managers
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HSBC
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Mitsubishi UFJ Securities
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PNC Capital Markets LLC
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BNY Mellon Capital Markets, LLC
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RBS
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