Blankenship gets $12 million retirement package

December 7, 2010 by Ken Ward Jr.

Massey Energy late today detailed its severance package for retiring CEO Don Blankenship. The deal is outlined in this document filed with the U.S. Securities and Exchange Commission.

On first glance, the deal appears to include:

— $12 million, in two payments — one of $2 million this Dec. 31 and another of $10 million on July 1, 2011.

— Health-care coverage for two years.

— This clause regarding secretarial help and office space:

… Secretarial assistance in the form of a single secretary, who will be available to perform reasonable administrative and clerical tasks (but will not be permitted to perform any services related to any business or activities that are competitive with the Company or its subsidiaries or affiliates) and continued use of Mr. Blankenship’s office and standard office equipment at Lauren Land Company during the Consulting Period (as defined below), and, in the Company’s sole discretion, during the three subsequent calendar years.

— Blankenship will continue to consult for Massey for two years, and will not compete with Massey nor hire away Massey employees for that same period of time. He will be paid a $5,000 per month retainer as a consultant.

11 Responses to “Blankenship gets $12 million retirement package”

  1. Vnxq809 says:

    WOW!……Heckuva severance package – even for a publicly traded coal company……

    BTW – Has anyone seen the new edition of Rolling Stone w/ the expose on Blankenship titled “The Dark Lord of Coal Country”…..

    It is scathing…..

    Vnxq809

  2. Amanda says:

    Some suggestions of how Massey could spend that money instead:
    http://su.pr/1tbWpP

  3. Montanus says:

    I love it that Massey made him sign the same kind of regular old noncompete agreement that most of us working stiffs get stuck with all the time. It’s interesting to note that he got some pretty good terms in there, such as permission to work for another coal company as long as it has less than 5 million tons of annual production. Clearly that actually includes a lot of small coal companies all over east KY and WV, so maybe it’s an indication that he’s going to try to shack up with some smaller operators but not quit the coal business altogether…? we shall see. Or maybe he’ll try to buy the Tiller or Freedom Mines and operate those on his own…

  4. rhmooney3 says:

    http://www.reuters.com/article/idUSN07807432010120
    (Excerpt)
    He will also receive additional cash from the company in lieu of his bonus and other incentive payments that he was due for 2010, the company said, but did not disclose a sum for these payments.

    Blankenship will also provide consulting services to Massey for two years for a $5,000 monthly retainer. He will receive health care for that period as well.

  5. rhmooney3 says:

    This sounds like lifetime employment to me.

    December 7, 2010
    http://abcnews.go.com/Blotter/golden-parachute-don-blankenship-massey-energy/story?id=12333677

    (Excerpts)

    angry shareholders who have been agitating for the coal executive’s ouster aren’t sure whether to celebrate or lament.

    That’s because corporate filings are revealing the staggering cost of his departure — a golden parachute that will provide Blankenship with $2.7 million upon retirement, a free house for life, millions more in deferred compensation, and a “salary continuation retirement benefit” of $18,241-a-month that will continue for 10 years after his departure at the end of the year.

    “The fact of the matter is, the company absolutely needs him to leave. You want to say, anything’s worth it because the company has no future with him,” said Per W. Olstad, a lawyer with CtW Investment Group, a shareholder group that has pushed for Blankenship to step down. “But it’s an egregious payout. It’s way beyond what he’s earned. Given how destructive his mismanagement has been, he simply does not deserve it.”

    The full breadth of Blankenship’s retirement package is still not known, but the web site Footnoted.com laid out some of the terms in an item posted this morning, including what it says is a $5.7 million pension, generous stock options, and $27.2 million from a deferred-compensation account, “a combination of pay he set aside and interest Massey has promised to pay him on those sums.” The web site also noted that the free housing Blankenship has enjoyed during his tenure as CEO will continue into his retirement, as will the company’s agreement to handle any income taxes he would owe for getting use of the house.

  6. Monty says:

    And as Don was quoted in that Rolling Stone article, he’s going to die with more money than he needs. It appears that he has made very, very sure of that. But then, to Don, it has always been all about the money before anything else.

  7. Mari-Lynn says:

    As was quoted in Rolling Stone, I feel confident that Don will indeed die with more money than he needs. We all do, Mr Blankenship. All that we have is our reputation and our honor. And the memory of what we have done.

  8. Vnxq809 says:

    Thanx for the link, Ken….I did indeed miss it…..I took the time to scan my print copy to email to all my fellow “industry hacks” as most of them I’m sure don’t subscribe!

    Appreciate the link – much cleaner…

    Vnxq809

  9. Monty says:

    On reading the one link rhmooney3 provided, I think we need to upgrade the color of Don’s parachute from gold to platinum. This really does beg the question – is he Really leaving? Or is this just kind of an extended vacation until all the hubbub about Upper Big Branch dies down and the Republicans take over completely in two more years and can get all the regulators to stop trying to regulate?

  10. rhmooney3 says:

    Monty, well said.

    There is no doubt at all that Don Blankenship will continue to be involved with the coal industry.

    As for Massey Energy, he is being casted off but there is still a strong line keeping him attached.

    Also, I would expect that Massey wants to move forward quickly so its next steps should be very soon.

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