Attached files
file | filename |
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EX-10.1 - EXHIBIT10.1 - MASSEY ENERGY CO | exhibi101.htm |
EX-10.4 - EXHIBIT10.4 - MASSEY ENERGY CO | exhibit104.htm |
EX-10.2 - EXHIBIT10.2 - MASSEY ENERGY CO | exhibit102.htm |
EX-10.3 - EXHIBIT10.3 - MASSEY ENERGY CO | exhibit103.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): January 6, 2010 (December 30,
2009)
MASSEY
ENERGY COMPANY
(Exact
Name of Registrant as Specified in Charter)
Delaware
(State
or Other Jurisdiction
of
Incorporation)
|
1-7775
(Commission
File Number)
|
95-0740960
(IRS
Employer
Identification
No.)
|
4
North 4th
Street, Richmond, Virginia 23219
(Address
of Principal Executive Offices) (Zip Code)
(804)
788-1800
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
5.02.
Departure of Directors or Certain Officers; Election of Directors; Appointment
of Certain Officers; Compensatory Arrangements of Certain Officers.
Letter
Agreement with Don L. Blankenship
On December 30, 2009, Massey Energy
Company (the “Registrant”) entered into a letter agreement with Don L.
Blankenship regarding his continued employment as Chairman and Chief Executive
Officer of the Registrant through December 31, 2011 (the “Letter
Agreement”).
The material terms and conditions of
the Letter Agreement which relate to Mr. Blankenship’s employment by the
Registrant for fiscal years 2010 and 2011 are as follows: (i) a base salary of
$83,333 per month; (ii) a target cash incentive bonus award for fiscal year 2010
of $1,500,000 and a target cash incentive bonus award for fiscal year 2011 of
$1,500,000, each based on the achievement of certain performance objectives set
by the Compensation Committee for fiscal years 2010 and 2011, respectively;
(iii) restricted stock and restricted unit awards of 12,700 shares of restricted
stock and 7,300 restricted stock units for each of fiscal years 2010 and 2011,
granted pursuant to the Massey Energy Company 2006 Stock and Incentive
Compensation Plan (the “2006 Plan”); (iv) two performance-based restricted unit
awards for fiscal year 2010, one for a total of 81,500 restricted units
(assuming the achievement of Level 1 targeted performance for all the
performance objectives) and one for a total of 32,250 units (assuming the
achievement of Level 2 targeted performance for all the performance objectives)
in 2010 and two performance-based restricted unit awards for fiscal year 2011,
the number of units which shall be determined by the Compensation Committee on
its award date in 2011, which shall vest, in whole or in part, based on the
achievement of certain performance objectives set by the Compensation Committee
for fiscal years 2010 and 2011, respectively; (v) two performance-based cash
incentive awards for fiscal year 2010, one for a total of 32,250 units (assuming
the achievement of Level 3 targeted performance for all the performance
objectives) and one for a total of 334,000 units (assuming the achievement of
Level 4 targeted performance for all the performance objectives) and two
performance-based cash incentive awards for fiscal year 2011, the number of
units which shall be determined by the Compensation Committee on its award date
in 2011, which shall be earned, in whole or in part, based on the achievement of
certain performance objectives set by the Compensation Committee for fiscal
years 2010 and 2011, respectively, which for fiscal year 2010 shall be equal to
the number of earned units times the closing market price of the Registrant’s
common stock on the New York Stock Exchange on the last trading day of 2010, and
for fiscal year 2011 shall be equal to the number of earned units times the
closing market price of the Registrant’s common stock on the New York Stock
Exchange on the last trading day of 2011; (vi) a performance-based restricted
stock award, pursuant to the 2006 Plan, for each of fiscal years 2010 and 2011
(based on the achievement of certain performance objectives set by the
Compensation Committee), one for a target number of 71,076 restricted shares in
2010 and one for a target number of restricted shares which shall be determined
by the Compensation Committee on its award date in 2011; and (vii) the premium
payments during 2010 and 2011, if any, on split dollar life insurance policies
owned by the Registrant with death benefit endorsements payable to Mr.
Blankenship, his estate or designated beneficiaries, totaling
$4,000,000. In accordance with the 2006 Plan from which the foregoing
equity- and performance-based awards are made, the aggregate maximum amount
payable as “incentive awards” under the 2006 Plan (which consists of the cash
incentive bonus awards in item (ii) above and the performance-based cash
incentive awards in item (v) above) shall not exceed $10,000,000 for any fiscal
year. In addition, the Compensation Committee shall have the right, in its sole
discretion, to reduce the actual award payout for any cash incentive bonus award
in item (ii) above and any performance-based restricted stock award in item (vi)
above by up to and including 5% of the maximum award payout provided that such
discretion shall only be exercised based on the Compensation Committee’s review
and its judgment as to whether Mr. Blankenship has satisfactorily proposed,
updated as appropriate, and implemented a successorship plan for all executive
ranks. The Compensation Committee retains the discretion to cause the Registrant
to pay or provide for additional or other compensation for extraordinary
performance regardless of the outcome on any performance-based pay contained in
the Letter Agreement provided such extraordinary performance relates to
performance which is not based on the performance criteria or goals contained in
the Letter Agreement.
Notwithstanding the base salary
amount set forth in the Letter Agreement, in conjunction with and in support of
the Registrant’s cost reduction initiatives, Mr. Blankenship will continue to
take a ten percent reduction in his monthly base compensation. Other
compensation to which Mr. Blankenship is entitled by contract will remain
unchanged, and payments under any employment and/or change of control agreement
which are salary-based will continue to be based on Mr. Blankenship’s unreduced
base salary amount as set forth in the Letter Agreement.
In the event that
Mr. Blankenship’s employment with the Registrant terminates during the
period commencing January 1, 2010 through December 30, 2011 for any
reason other than for Cause (as such term is defined in that certain Change in
Control Agreement dated December 21, 2005, as amended and restated
effective January 1, 2009, between the Registrant and Mr. Blankenship (the
“Change in Control Agreement”)) under circumstances where such cessation of
employment is not covered by the Change in Control Agreement, then the
Registrant shall pay to Mr. Blankenship, or if Mr. Blankenship is
deceased, to his estate, the sum of $5,000,000, unless Mr. Blankenship
elects to terminate his employment voluntarily during the period commencing
January 1, 2010 through December 30, 2011 other than for any reason
which would constitute “a Constructive Termination Associated With a Change in
Control” (as defined, and determined pursuant to the procedure set forth in the
Change in Control Agreement, under circumstances where such Constructive
Termination is not covered by the Change in Control Agreement).
In the event that Mr. Blankenship’s
employment with the Registrant terminates on or before December 30, 2010 and he is entitled to
payments and benefits under the Change in Control Agreement, then the Registrant
shall pay to Mr. Blankenship, or if Mr. Blankenship is deceased, to his estate,
the sum of $2,000,000 on the date of termination. In the event the
Executive ceases to be employed on or after January 1, 2011 through December 31,
2011 and is entitled to payments and benefits under the Change in Control
Agreement, then the Registrant shall pay to Mr. Blankenship, or if Mr.
Blankenship is deceased, to his estate, the sum of $2,000,000 on the date of
termination. Either of these payments shall be in addition to any
payments and benefits to which Mr. Blankenship is entitled under the Change in
Control Agreement, but shall be subject to any payment limitations under the
Change in Control Agreement.
In the event that
Mr. Blankenship’s employment with the Registrant terminates during the
period commencing January 1, 2010 through December 30, 2011 for any
reason, all of Mr. Blankenship’s rights with respect to the awards covering the
2010 fiscal year in items (ii), (iv), (v) and (vi) above, shall terminate and
all rights thereunder shall cease and payment of life insurance premiums as set
forth in item (vii) above shall cease. In the event that Mr.
Blankenship’s employment with the Registrant terminates during the period
commencing January 1, 2011 through December 30, 2011 for any reason, all of
Mr. Blankenship’s rights with respect to the following awards covering the 2011
fiscal year in items (ii), (iv), (v) and (vi) above, shall terminate and all
rights thereunder shall cease and payment of life insurance premiums as set
forth in item (vii) above shall cease.
The amount of performance-based
compensation that Mr. Blankenship earns during fiscal year 2010 (assuming he is
employed by the Registrant from January 1, 2010 through December 30, 2010) under
items (ii), (iv), (v) and (vi) above is capped at $11,000,000 less the product
obtained by multiplying 6,668 by the closing market price of the Registrant’s
common stock on the New York Stock Exchange on December 30, 2010 (the “2010
Cap”). The order in which Mr. Blankenship’s earned compensation for
2010 will be applied to the cap for 2010 is as follows: (a) the target cash
incentive bonus award earned by Mr. Blankenship during 2010, (b) the Level 1
performance restricted unit award earned by Mr. Blankenship during 2010,
(c) the Level 2 performance restricted unit award earned by Mr. Blankenship
during 2010, (d) the Level 3 performance cash award earned by Mr.
Blankenship during 2010, (e) the Level 4 performance cash award earned by Mr.
Blankenship during 2010, and (f) the value of the performance restricted
stock award earned by Mr. Blankenship during 2010 based on the closing market
price of the Registrant’s common stock on the New York Stock Exchange on the
date of payment for federal income tax purposes. Each of items
(b)-(e) above will be based on the closing market price of the Registrant’s
common stock on the New York Stock Exchange on the last trading day of 2010. Any
compensation that would have otherwise been payable to Mr. Blankenship but for
the 2010 Cap will not be considered earned and will not be paid.
The amount of performance-based
compensation that Mr. Blankenship earns during fiscal year 2011 (assuming he is
employed by the Registrant from January 1, 2011 through December 30, 2011) under
items (ii), (iv), (v) and (vi) above is capped at $11,000,000 less the product
obtained by multiplying 13,334 by the closing market price of the Registrant’s
common stock on the New York Stock Exchange on December 30, 2011 (the “2011
Cap”). The order in which the Mr. Blankenship’s earned compensation
for 2011 will applied to the cap for 2011 is as follows: (1) the cash
incentive bonus award earned by Mr. Blankenship during 2011, (2) the Level
1 performance restricted unit award earned by Mr. Blankenship during 2011, (3)
the Level 2 performance restricted unit award earned by Mr. Blankenship during
2011, (4) the Level 3 performance cash award earned by Mr. Blankenship
during 2011, (5) the Level 4 performance cash award earned by Mr. Blankenship
during 2011, and (6) the value of the 2011 performance restricted stock
award earned by Mr. Blankenship during 2011 based on the closing market price of
the Registrant’s common stock on the New York Stock Exchange on the date of
payment for federal income tax purposes. Each of items (2)-(5) above
will be based on the closing market price of the Registrant’s common stock on
the New York Stock Exchange on the last trading day of 2010. Any
compensation that would have otherwise been payable to Mr. Blankenship but for
the 2011 Cap will not be considered earned and will not be paid.
In addition to the specific forms of
remuneration discussed above, Mr. Blankenship will continue to participate
in the employment benefit plans and arrangements provided by the Registrant to
its other employees and be entitled to receive perquisites provided to him in
keeping with past practice, including, but not limited to, use of the
Registrant’s airplanes.
The Letter Agreement may be extended by
mutual agreement between Mr. Blankenship and the Registrant for an additional
two years.
A copy of the Letter Agreement is
attached hereto as Exhibit 10.1 and incorporated herein by
reference.
Amended
and Restated Incentive Award Agreements
On
December 31, 2009, John C. Adkins, Senior Vice President and Chief
Operating Officer, Michael K. Snelling, Vice President of Surface Operations,
and Eric B. Tolbert, Vice President and Chief Financial Officer, each an
executive officer who was named in the Registrant’s 2009 Proxy Statement (the
“Named Executive Officers”), entered into an amended and restated Cash Incentive
Award Agreement (Based on Cumulative Earnings Before Taxes) (the “Incentive
Award Agreement”) made pursuant to the Massey Energy Company 2006 Stock and
Incentive Compensation Plan (the “2006 Plan”) as approved by the Compensation
Committee of the Registrant. The material change to the Incentive Award
Agreement replaces the cash payment that otherwise would be paid out pursuant to
the terms of the Incentive Award Agreement in the event of a covered termination
following a change in control based upon a target amount, with a lump sum cash
payment. A copy of the amended and restated form of Incentive Award Agreement is
attached hereto as Exhibit 10.2 and incorporated herein by
reference.
Employment
Agreement Amendments
On
December 31, 2009, Baxter F. Phillips, Jr., President and a Named Executive
Officer of the Registrant, entered into an amendment to his employment agreement
with the Registrant as approved by the Compensation Committee. The
material change to Mr. Phillips' employment agreement replaces the cash payments
calculated based on base pay and an annual bonus target that would be paid upon
a covered termination before or after a change in control, with a lump sum cash
payment. A copy of the amendment to Mr. Phillips' employment agreement
is attached hereto as Exhibit 10.3 and is incorporated herein by
reference.
On December 31, 2009, John C. Adkins, Senior Vice President and Chief
Operating Officer and a Named Executive Officer of the Registrant, entered
into an amendment to his employment agreement with the Registrant as approved by
the Compensation Committee. The material change to Mr. Adkins' employment
agreement replaces the cash payments calculated based on base pay and an annual
bonus target that would be paid upon a covered termination before a change in
control, with a lump sum cash payment. A copy of the amendment to Mr. Adkins'
employment agreement is attached hereto as Exhibit 10.4 and is incorporated
herein by reference.
Effective
January 1, 2010, the annual salary of Michael K. Snelling, Vice President of
Surface Operations, one of the Registrant’s Named Executive Officers, was
increased to $316,000 as authorized by the Compensation Committee.
Exhibit
No.
|
Description
|
|
10.1
|
Letter
Agreement, dated December 30, 2009, between Massey Energy Company and Don
L. Blankenship
|
|
10.2
|
Form of
Cash Incentive Award Agreement (Based on Earning Before Taxes) under the
Massey Energy Company 2006 Stock and Incentive Compensation
Plan
|
|
10.3
|
Amendment
to Employment and Change in Control Agreement between Massey Energy
Company and Baxter F. Phillips, Jr. (effective January 1,
2010)
|
|
10.4
|
Amendment
to Retention and Employment Agreement between Massey Energy Company and
John C. Adkins (effective January 1,
2010)
|
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
MASSEY
ENERGY COMPANY
Date:
January 6,
2010 By: /s/ Richard R.
Grinnan
Name: Richard
R. Grinnan
Title: Vice
President and Corporate Secretary
Exhibit
Index
Exhibit
No.
|
Description
|
|
10.1
|
Letter
Agreement, dated December 30, 2009, between Massey Energy Company and Don
L. Blankenship
|
|
10.2
|
Form of
Cash Incentive Award Agreement (Based on Earning Before Taxes) under the
Massey Energy Company 2006 Stock and Incentive Compensation
Plan
|
|
10.3
|
Amendment
to Employment and Change in Control Agreement between Massey Energy
Company and Baxter F. Phillips, Jr. (effective January 1,
2010)
|
|
10.4
|
Amendment
to Retention and Employment Agreement between Massey Energy Company and
John C. Adkins (effective January 1,
2010)
|