PEABODY ENERGY CORPORATION

                EQUITY INCENTIVE PLAN FOR NON-EMPLOYEE DIRECTORS



                           RESTRICTED STOCK AGREEMENT



         THIS AGREEMENT (the "Agreement"), dated as of _________, 20__ is made

between PEABODY ENERGY CORPORATION, a Delaware corporation (the "Company") and

the undersigned director of the Company (the "Participant").



         WHEREAS, the Company wishes to award the Participant shares of its $.01

par value common stock ("Stock") with certain restrictions;



         WHEREAS, the Company wishes to carry out the Peabody Energy Corporation

Equity Incentive Plan for Non-Employee Directors (the "Plan"), the terms of

which are hereby incorporated by reference and made a part of this Agreement;

and



         WHEREAS, the Board (as hereinafter defined), appointed to administer

the Plan, has determined that it would be to the advantage and best interest of

the Company and its stockholders to grant shares of Stock with certain

restrictions provided herein to the Participant as an incentive for increased

efforts during the Participant's term as a director of the Company.



         NOW, THEREFORE, in consideration of the mutual covenants herein

contained and other good and valuable consideration, receipt of which is hereby

acknowledged, the parties do hereby agree as follows:



         1.       Terms of Award. The following words and phrases used in the

Agreement shall have the meanings set forth in this paragraph 1:



         (a)      The "Participant" is __________



         (b)      The "Grant Date" is __________, 20__



         (c)      The "Restricted Period" is the period beginning on the Grant

                  Date and ending on the third anniversary of the Grant Date.



         (d)      The number of shares of "Restricted Stock" awarded under this

                  Agreement shall be _________ shares. Shares of "Restricted

                  Stock" are shares of Stock granted under this Agreement and

                  are subject to the terms of this Agreement and the Plan.



Other words and phrases used in the Agreement are defined in the Plan or

elsewhere in the Agreement. Except where the context clearly implies or

indicates the contrary, a word, term or phrase used in the Plan is similarly

used in the Agreement.



                                       1

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         2.       Dividends and Voting Rights. The Participant shall be entitled

to receive any dividends paid with respect to shares of Restricted Stock that

become payable during the Restricted Period; provided, however, that no

dividends shall be payable with respect to record dates occurring prior to the

Grant Date, or with respect to record dates occurring on or after the date, if

any, on which the Participant has forfeited the shares of Restricted Stock. The

Participant shall be entitled to vote the shares of Restricted Stock during the

Restricted Period to the same extent as would have been applicable to the

Participant if the Participant was then vested in the shares; provided, however,

that the Participant shall not be entitled to vote the shares with respect to

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