Exhibit
10.32
November
13, 2007
Mr.
Don L. Blankenship
24406
U.S. Route 119
Belfry,
KY 41514
Dear
Don:
This
letter will summarize our agreement regarding your continued
employment as Chairman, Chief Executive Officer and President
of Massey Energy Company, through December 31,
2009. Your current employment agreement will expire
December 31, 2007. I am very pleased that you
will continue your leadership of Massey and look forward to
the productive years ahead.
The
specifics of your compensation package are included on
Appendix A to this letter. In addition, you
generally will continue to participate in the employee benefit
plans and arrangements (e.g., the Massey Energy Retirement
Plan, the Coal Company Salary Deferral and Profit Sharing
Plan, the welfare benefit programs and the nonqualified or
supplemental benefit programs) and be entitled to receive the
perquisites provided to you in keeping with past practice,
including, but not limited to, use of the Company’s
airplanes.
If
you have any questions regarding the terms and conditions of
your employment or the proposed compensation package included
on Appendix A, please do not hesitate to call
me. If the offer details are acceptable, please
acknowledge by signing and dating one copy of this letter and
return it to me.
Sincerely,
/s/
Bobby R. Inman
Admiral
Bobby R. Inman
Chairman,
Compensation Committee
Massey
Energy Company
Acknowledged
and agreed:
/s/ Don L. Blankenship
________
11/13/07
Don
L.
Blankenship Date
APPENDIX A
TO LETTER AGREEMENT
THIS
APPENDIX A is part of a letter agreement dated November
13, 2007 by and between MASSEY ENERGY COMPANY, a Delaware
corporation (“Massey”), and DON L. BLANKENSHIP
(the “Executive”), and relates to the
Executive’s employment by Massey for calendar years 2008
and 2009 subject to extension as set forth in Section 7
below.
SECTION
1.
Compensation
.
1.1.
Base Monthly
Salary – $83,333.
1.2.
Cash
Incentive Bonus
Awards – A target cash incentive bonus award for
fiscal year 2008 of $900,000 (the “2008 Cash Incentive
Bonus Award”) and a target cash incentive bonus award
for fiscal year 2009 of $900,000 (the “2009 Cash
Incentive Bonus Award”), each granted pursuant to the
Massey Energy Company 2006 Stock and Incentive Compensation
Plan, as such plan may be amended from time to time (the
“2006 Plan”) based on the achievement of certain
performance objectives for fiscal year 2008 (for the 2008
Cash Incentive Bonus Award) and for fiscal year 2009 (for the
2009 Cash Incentive Bonus Award) using qualifying performance
criteria contained in the 2006 Plan. The target 2008 Cash
Incentive Bonus Award was granted and performance objectives
set by the Compensation Committee of the Board of Directors
on November 13, 2007. The target 2009 Cash Incentive Bonus
Award shall be granted and the performance objectives set by
the Compensation Committee of the Board of Directors of
Massey prior to the commencement of fiscal year 2009. There
shall be a threshold level of performance for each
performance objective below which no payment shall occur, a
target level of performance, and a maximum level of
performance, the value of which can be up to two and a half
times the target amount, above which no additional payment
will occur. The achievement of Cash Incentive Bonus Awards
for purposes of this Section 1.2 shall be confirmed by the
Chief Financial Officer and the Compensation Committee and
may be adjusted at the sole discretion of the Compensation
Committee in a manner consistent with the performance-based
compensation rules of Section 162(m) of the Internal Revenue
Code, as amended (the “IRC”), and as permitted by
the 2006 Plan. The 2008 Cash Incentive Bonus Award, if
payable, shall be paid on February 28, 2009 and the 2009 Cash
Incentive Bonus Award, if payable, shall be paid on February
28, 2010.
1.3.
Long Term
Incentive Awards – The Executive shall
participate in the Company’s 2008 Long Term Incentive
Program which covers fiscal years 2008 through 2010 and the
Company’s 2009 Long Term Incentive Program which covers
fiscal years 2009 through 2011. The Executive’s long
term incentive awards granted pursuant to each of the 2008
Long Term Incentive Program (the “2008 Long Term
Incentive Awards”) and the 2009 Long Term Incentive
Program (the “2009 Long Term Incentive Awards”)
shall include the following four components: (i) a $300,000
target cash incentive award granted pursuant to the 2006 Plan
based on the achievement of a certain performance objective
using qualifying performance criteria contained in the 2006
Plan (with a threshold level of performance below which no
payment shall occur, a target level of performance, and a
maximum level of performance, the value of which can be up to
two times the target amount, above which no additional
payment will occur); (ii) 50,000 non-qualified stock options
granted under the 2006 Plan with service-based vesting; (iii)
12,700 shares of restricted stock granted pursuant to the
2006 Plan with service-based vesting; and (iv) 7,300
restricted units granted pursuant to the 2006 Plan with
service-based vesting. The Executive’s 2008 Long Term
Incentive Awards and the 2009 Long Term Incentive Awards will
be subject to all the terms, conditions, and performance and
service-based vesting requirements made to participants in
Massey’s 2008 Long Term Incentive Program and 2009 Long
Term Incentive Program, respectively, with the following
exception regarding the non-qualified stock options, such
options must be exercised by the Executive in the first
twenty days exercise is permissible for the Executive
pursuant to Massey’s trading window policy and
applicable securities laws following their vesting, otherwise
they will be automatically forfeited.
1.4.
Performance-Based
Restricted Unit Awards – Two performance-based
restricted unit awards, granted prior to the commencement of
fiscal year 2008, pursuant to the 2006 Plan, which shall vest
based on the achievement of certain performance objectives for
fiscal year 2008 using qualifying performance criteria
contained in the 2006 Plan (the “2008 Performance
Restricted Unit Awards”) and two performance-based
restricted unit awards, granted prior to the commencement of
fiscal year 2009, pursuant to the 2006 Plan, which shall vest
based on the achievement of certain performance objectives for
fiscal year 2009 using qualifying performance criteria
contained in the 2006 Plan (the “2009 Performance
Restricted Unit Awards”). The 2008 Performance
Restricted
Unit
Awards were granted and the performance objectives were set by
the Compensation Committee on November 13, 2007 and the 2009
Performance Restricted Unit Awards shall be granted and the
performance objectives shall be set by the Compensation
Committee prior to the commencement of fiscal year 2009. Each
particular performance objective shall consist of two levels
of targeted performance, a threshold level (“Level
1”) and an enhanced level (“Level 2”),
which, for purposes of this Section 1.4, if achieved, shall be
confirmed by the Chief Financial Officer and the Compensation
Committee and which may be adjusted at the sole discretion of
the Compensation Committee in a manner consistent with the
performance-based compensation rules of Section 162(m) of the
IRC, and as permitted by the 2006 Plan. The Level 1
Performance Restricted Unit Award shall be for a total of
120,000 restricted units, comprised of a certain number of
restricted units attributed to each particular performance
objective, and the Level 2 Performance Restricted Unit Award
shall be for a total of 70,000 restricted units, comprised of
a certain number of restricted units attributed to each
particular performance objective. If Level 1 targeted
performance for a given performance objective is confirmed as
set forth above, the Executive shall vest in that portion of
the Level 1 Performance Restricted Unit Award that has been
allocated to the achievement of the targeted performance for
such performance objective and that portion of the Level 1
Performance Restricted Unit Award that has vested shall be
paid on February 28 of the year following the completion of
the fiscal year of performance to which it relates, based on
the closing market price of Massey common stock on the New
York Stock Exchange on the last trading day of the fiscal year
of performance to which it relates. If Level 1 targeted
performance for a given performance objective is not confirmed
as set forth above that portion of the Level 1 Performance
Restricted Unit Award that has been allocated to the
achievement of the targeted performance for such performance
objective shall be forfeited. If Level 2 targeted performance
for a given performance objective is confirmed as set forth
above, the Executive shall vest in that portion of the Level 2
Performance Restricted Unit Award that has been allocated to
the achievement of the targeted performance for such
performance objective and that portion of the Level 2
Performance Restricted Unit Award that has vested shall be
paid on February 28 of the year following the completion of
the fiscal year of performance to which it relates, based on
the closing market price of Massey common stock on the New
York Stock Exchange on the last trading day of the fiscal year
of performance to which it relates. If the targeted
performance for a given performance objective is confirmed, as
set forth above, to have fallen between Level 1 and Level 2
targeted performance for such performance objective, the
Executive shall vest in that portion of the Level 2
Performance Restricted Unit Award that is equal to the number
of restricted units allocated to Level 2 targeted performance
for such performance objective times a fraction, the numerator
of which is that amount of performance achieved over and above
Level 1 targeted performance for such performance objective
and the denominator of which is the difference between Level 2
targeted performance for such performance objective and Level
1 targeted performance for such performance objective. For
example, if the number of restricted units allocated to Level
2 targeted performance for a certain performance objective was
30,000 and only one-third of Level 2 targeted performance for
such performance objective was achieved, then the Executive
would vest in 10,000 restricted units. That portion of the
Level 2 Performance Restricted Unit Award that vests shall be
paid on February 28 of the year following completion of the
fiscal year of performance to which it relates and shall be
based on the closing market price of Massey common stock on
the New York Stock Exchange
