Exhibit 10.3
Armstrong Energy, Inc.
Retention Bonus Agreement
Personal and Confidential
June 9, 2017

Re: Retention Bonus

J. Hord Armstrong, III
748 Cella Road
Saint Louis, MO 63124

Dear Hord:

On behalf of Armstrong Energy, Inc. (the “Company”), I am pleased to offer you
the opportunity to receive a retention bonus, if you agree to the terms and
conditions contained in this Retention Bonus Agreement (this “Agreement”), which
shall be effective as of the date of your signature below (the “Effective
Date”).

1.    Retention Bonus. Subject to the terms and conditions set forth herein, you
will receive a payment in the amount of $150,000 (the “Retention Bonus”),
subject to the Company’s receipt of your countersignature on this Agreement. The
amount of the Retention Bonus will reduce, by an equal amount, any severance
payment the participant is entitled to receive in their employment agreement
with the Company during the period commencing on the Effective Date and ending
on the Retention Date (as defined herein). Nothing herein shall affect any
contractual severance payment that first becomes due and payable to participant
subsequent to the Retention Date.

Notwithstanding the foregoing, in the event (a) you voluntarily terminate your
employment with the Company without Good Reason (as defined below), (b) the
Company terminates your employment for Cause (as defined below), or (c) the
Compensation Committee of the Board of Directors of the Company determines that
you have failed to attempt in good faith to perform your duties after receiving
notice from the Company (provided that the Compensation Committee of the Board
of Directors of the Company will undertake a periodic review of your performance
in good faith for purposes of this section (c)) (as applicable, a “Bad Act
Event”), in each case, before the twelve-month anniversary of the Effective Date
(with such anniversary date, the “Retention Date”), you will be required to
repay to the Company, within ten days of such event, an amount equal to the
product of the Pro Ration Factor and the After-Tax Value of the Retention Bonus.
The Pro Ration Factor will be: (i) 100% in the event of a Bad Act Event within
three months after the Effective Date, (ii) 75% in the event of a Bad Act Event
after three and before six months after the Effective Date, (iii) 50% in the
event of a Bad Act Event after six and before nine months after the Effective

--------------------------------------------------------------------------------

Date, (iv) 25% in the event of a Bad Act Event after nine and before 12 months
after the Effective Date, and (v) 0% after the first anniversary of the
Effective Date. The “After-Tax Value of the Retention Bonus” is equal to the
Retention Bonus, reduced by all taxes and other mandatory withholdings the
Company is required to, and does, withhold therefrom. For the avoidance of
doubt, if the Company terminates your employment without Cause, you will not be
required to repay to the Company any portion of the Retention Bonus.

For purposes of this Agreement:

(a) if you have an employment agreement with the Company, “Cause” has the
meaning set forth in your employment agreement; or

(b) if you do not have an employment agreement with the Company, “Cause,” means
your (i) material breach of your duties and responsibilities, which is not
remedied promptly after the Company gives you written notice specifying such
breach, (ii) commission of a felony, (iii) commission of theft, fraud, a
material breach of trust or any material act of dishonesty involving the Company
or its subsidiaries, or (iv) significant violation of the code of conduct of the
Company or its subsidiaries or of any statutory or common law duty of loyalty to
the Company or its subsidiaries.

For purposes of this Agreement:
 
(a) if you have an employment agreement with the Company, “Good Reason” has the
meaning set forth in your employment agreement; or

(b) if you do not have an employment agreement with the Company, “Good Reason”
means any of the following, in each case, without your consent: (i) a change in
your title or any material diminution of your responsibilities or authority or
the assignment of any duties inconsistent with your position, in each case,
compared to what was in effect as of the Effective Date, (ii) a reduction of
your annual base salary and/or target annual bonus as in effect on the Effective
Date or as the same may be increased from time to time, (iii) a relocation of
your principal office location more than fifty miles from the Company’s offices
at which you are based as of the Effective Date (except for required travel on
the Company’s business to an extent substantially consistent with your business
travel obligations as of the Effective Date), or (iv) any material breach by the
Company or its affiliates of any other material written agreement with you that
remains uncured for ten days after you give written notice of such breach to the
Company. Your right to terminate your employment for Good Reason will not be
affected by your incapacity due to physical or mental illness. The occurrence of
an event that would otherwise constitute Good Reason will cease to be an event
constituting Good Reason, if you do not timely provide notice to the Company
within ninety days of the date on which you first become aware of the occurrence
of that event. The Company shall have fifteen days following receipt of your
written notice in which to correct in all material respects the circumstances
constituting Good Reason, and you must terminate employment within sixty days
following expiration of the Company’s fifteen-day cure period. Otherwise, any
claim of such circumstances constituting “Good Reason” shall be deemed
irrevocably waived by you.

2

--------------------------------------------------------------------------------

2.    Withholding Taxes. The Company may withhold from any and all amounts
payable to you hereunder such federal, state and local taxes as the Company
determines in its sole discretion may be required to be withheld pursuant to any
applicable law or regulation.

3.    No Right to Continued Employment. Nothing in this Agreement will confer
upon you any right to continued employment with the Company (or its subsidiaries
or their respective successors) or to interfere in any way with the right of the
Company (or its subsidiaries or their respective successors) to terminate your
employment at any time.
4.    Other Benefits. The Retention Bonus is a special payment to you and will
not be taken into account in computing the amount of salary or compensation for
purposes of determining any bonus, incentive, pension, retirement, death or
other benefit under any other bonus, incentive, pension, retirement, insurance
or other employee benefit plan of the Company, unless such plan or agreement
expressly provides otherwise.

5.    No Assignments; Successors. This Agreement is personal to each of the
parties hereto. Except as provided in this paragraph, no party may assign or
delegate any right or obligation hereunder without first obtaining the written
consent of the other party hereto. The Company may assign this Agreement to any
successor to all or substantially all of the business and/or assets of the
Company; provided that the Company will require such successor to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place.

6.    Governing Law. This Agreement will be governed by, and construed under and
in accordance with, the internal laws of the State of Missouri, without
reference to rules relating to conflicts of laws.

7.    Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which together shall
constitute one and the same instrument.

8.    Entire Agreement; Amendment. This Agreement constitutes the entire
agreement between you and the Company with respect to the Retention Bonus and
supersedes any and all prior agreements or understandings between you and the
Company with respect to the Retention Bonus, whether written or oral. This
Agreement may be amended or modified only by a written instrument executed by
you and the Company.

9.    Section 409A Compliance. Although the Company does not guarantee the tax
treatment of the Retention Bonus, the intent of the parties is that the
Retention Bonus be exempt from the requirements of Section 409A of the Internal
Revenue Code and the regulations and guidance promulgated thereunder, and
accordingly, to the maximum extent permitted, this Agreement shall be
interpreted in a manner consistent therewith.

[no more text on this page]

3

--------------------------------------------------------------------------------

This Agreement is intended to be a binding obligation on you and the Company. If
this Agreement accurately reflects your understanding as to the terms and
conditions of the Retention Bonus, please sign and date one copy of this
Agreement no later than June 16, 2017 and return the same to me for the
Company’s records. You should make a copy of the executed Retention Bonus
Agreement for your records.

Very truly yours,
Armstrong Energy, Inc.

    
    

The above terms and conditions accurately reflect our understanding regarding
the terms and conditions of the Retention Bonus, and I hereby confirm my
agreement to the same.

/s/ J. Hord Armstrong, III Dated: June 12, 2017
Signature

J. Hord Armstrong, III             Executive Chairman    
Print Name             Print Title
                            

4