Filed Pursuant to Rule 424(b)(3) and (c)
Registration Statement No. 33-36868
Prospectus Supplement dated September 15, 1996
CUSTOMER STOCK PURCHASE PLAN of
NATIONAL FUEL GAS COMPANY
Supplement to Prospectus dated
May 20, 1991
The following supplements the "Description of Common Stock" on pages 10 and
11 of the Prospectus.
SUMMARY OF RIGHTS TO PURCHASE COMMON STOCK
On June 13, 1996, the Board of Directors of National Fuel Gas Company (the
"Company") declared a dividend distribution of one Right for each
outstanding share of Common Stock, $1.00 par value, of the Company (the
"Common Stock") to stockholders of record at the close of business on July
31, 1996 (the "Record Date"). The Rights are to be issued pursuant to a
shareholder rights plan which was approved by the Board of Directors on
March 19, 1996. Each Right entitles the registered holder to purchase from
the Company one-half of one share of Common Stock at a price of $130 per
share (the "Purchase Price"), being $65.00 per half share, subject to
adjustment. The description and terms of the Rights are set forth in a
Rights Agreement dated June 12, 1996 (the "Rights Agreement") between the
Company and Marine Midland Bank, as Rights Agent (the "Rights Agent").
Distribution Date; Transfer of Rights. Until the earlier to occur of (i)
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ten days following the date (the "Shares Acquisition Date") of the public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of Common Stock or other voting securities ("Voting
Stock") that have 10% or more of the voting power of the outstanding shares
of Voting Stock or (ii) ten days following the commencement or announcement
of an intention to make a tender offer or exchange offer, the consummation
of which would result in such person acquiring, or obtaining the right to
acquire, beneficial ownership of Voting Stock having 10% or more of the
voting power of the outstanding shares of Voting Stock (the earlier of such
dates being called the "Distribution Date"), the Rights will be evidenced,
with respect to any of the Company's Common Stock certificates outstanding
as of the Record Date, by such Common Stock certificate. The Rights
Agreement provides that, until the Distribution Date, the Rights will be
transferred with and only with the Company's Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after the Record Date upon transfer or new
issuance of the Company's Common Stock will contain a notation
incorporating the Rights Agreement by reference. Until the Distribution
Date (or earlier redemption or expiration of the Rights), the surrender for
transfer of any of the Company's Common Stock certificates outstanding as
of the Record Date will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate. As soon
as practicable following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders of
record of the Company's Common Stock as of the close of business on the
Distribution Date and such separate Right Certificates alone will evidence
the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire at the close of Business on July 31, 2006, unless earlier
redeemed or exchanged by the Company as described below.
Exercise of Rights for Common Stock of the Company. At any time
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following the Distribution Date, each holder of a Right will have the right
to receive, upon exercise, Common Stock (or, in certain circumstances,
cash, property or other securities of the Company) having a value equal to
two times the Purchase Price of the Right then in effect. Notwithstanding
any of the foregoing, all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned by any
Acquiring Person will be null and void.
Exercise of Rights for Shares of the Acquiring Company. In the event that,
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at any time following the Shares Acquisition Date, (i) the Company is
acquired in a merger or other business combination transaction, or (ii) 50%
or more of the Company's assets or earning power are sold or transferred,
each holder of a Right (except those Rights held by an Acquiring Person
which have become void) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the Purchase Price of the Right then in effect.
Adjustments to Purchase Price. The Purchase Price payable, and the number
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of shares of Common Stock (or other securities, as the case may be)
issuable upon exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of the Common Stock, (ii) upon
the grant to holders of the Common Stock of certain rights or warrants to
subscribe for or purchase shares of the Common Stock or convertible
securities at less than the then current market price of the Common Stock
or (iii) upon the distribution to holders of the Common Stock of evidences
of indebtedness or assets (excluding regular periodic cash dividends or
dividends payable in the Common Stock) or of subscription rights or
warrants (other than those referred to above). Prior to the Distribution
Date, the Board of Directors of the Company may make such equitable
adjustments as it deems appropriate under the circumstances in lieu of any
adjustment otherwise required by the foregoing.
With certain exceptions, no adjustment in the Purchase Price will be
required until the earlier of (i) three years from the date of the event
giving rise to such adjustment or (ii) the time at which cumulative
adjustments require an adjustment of at least 1% in such Purchase Price.
No fractional shares of Common Stock will be issued and, in lieu thereof,
an adjustment in cash will be made based on the market price of the Common
Stock on the last trading date prior to the date of exercise.
Redemption and Exchange of Rights. At any time prior to 5:00 P.M. Buffalo,
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New York time on the tenth day following the Shares Acquisition Date, the
Company may redeem the Rights in whole, but not in part, at a price of $.01
per Right (the "Redemption Price"), payable in cash or stock. Under
certain circumstances set forth in the Rights Agreement, the decision to
redeem shall require the concurrence of a majority of the Independent
Directors. Immediately upon the action of the Board of Directors of the
Company electing to redeem the Rights with, if required, the concurrence of
the Independent Directors, the Company shall make announcement thereof, and
upon such action, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive the Redemption
Price.
At any time after the occurrence of the event set forth under the heading
"Exercise of Rights for Common Stock of the Company" above, the Board of
Directors may exchange the Rights (other than Rights owned by an Acquiring
Person, which have become void), in whole or in part, at an exchange ratio
of one share of Common Stock, and/or other securities, cash or other assets
deemed to have the same value as one share of Common Stock, per Right,
subject to adjustment.
Until a Right is exercised or exchanged for Common Stock, the Rights
themselves will not give the holder thereof any rights as a stockholder of
the Company such as the right to vote or to receive dividends. While the
distribution of the Rights will not be taxable to stockholders or to the
Company, stockholders may, depending upon the circumstances, recognize
taxable income in the event that the Rights become exercisable for Common
Stock or other consideration of the Company or for the stock of the
Acquiring Person as set forth above, or are exchanged as provided in the
preceding paragraph.
Amendments to Terms of the Rights. Any of the provisions of the Rights
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Agreement may be amended by the Board of Directors of the Company without
the consent of the holders of the Rights prior to the Distribution Date.
Thereafter, the provisions of the Rights Agreement may be amended by the
Board of Directors in order to cure any ambiguity, defect or inconsistency,
or to make changes which do not adversely affect the interests of holders
of Rights (excluding the interest of any Acquiring Person); provided,
however, that no supplement or amendment may be made on or after the
Distribution Date which changes those provisions relating to the principal
economic terms of the Rights. The Board of Directors may also, with the
concurrence of a majority of the Independent Directors, extend the
redemption period for up to an additional 20 days.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the
Company without conditioning the offer on the Rights being redeemed or a
substantial number of Rights being acquired. The Rights should not
interfere with any merger or other business combination approved by the
Board of Directors of the Company.
The term "Independent Directors" means any member of the Board of Directors
of the Company who was a member of the Board prior to the date of the
Rights Agreement, and any person who is subsequently elected to the Board
if such person is recommended or approved by a majority of the Independent
Directors but shall not include an Acquiring Person or any representative
thereof.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A
dated June 13, 1996. A copy of the Rights Agreement is available free of
charge from the Company. This summary description of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by this reference.
