Exhibit 10.1

EXECUTIVE TRANSITION AGREEMENT

This EXECUTIVE TRANSITION AGREEMENT is entered into as of the 5th day of April,
2013 (the “Effective Date”), by and between Westmoreland Coal Company, a
Delaware corporation (“Company”) and Keith E. Alessi (“Executive”).

WHEREAS, Executive has been employed by Company as its Chief Executive Officer
(“CEO”); and

WHEREAS, Executive and Company’s independent directors have discussed and desire
to arrange for an orderly, well-defined and amicable retirement of Executive as
CEO of Company, and at the same time to provide incentives for Executive to
remain engaged with and committed to Company and its stockholders.

NOW, THEREFORE, in consideration of these premises, Company and Executive hereby
agree as follows:

ARTICLE 1.

RETIREMENT AND CONTINUED INCENTIVES

1.1 Resignation of Employment.

(a) Executive hereby resigns as CEO of Company as of the Effective Date.

(b) On and after the Effective Date, Executive shall no longer be an employee of
the Company and Executive’s eligibility for medical coverage, retirement plan
participation and other employee benefits under Company’s benefit programs will
be governed by the terms and conditions of such programs to the extent
applicable to former employees.

1.2 Service on Company Board of Directors.

(a) As of the Effective Date and for a period of time ending on the earlier of
the 2015 annual meeting of stockholders and May 31, 2015 (the “Term”), Executive
agrees to remain a member of the Board of Directors of Company (the “Board”),
subject to election by the stockholders of Company, and Executive agrees to
serve as Executive Chairman of the Board, subject to appointment or election.

(b) During the Term, Company agrees to reimburse Executive for reasonable travel
expenses (including commercial airfare, food, lodging and out-of-pocket
expenses) incurred while performing services as a member of or Executive
Chairman of the Board. Reimbursement will be made in accordance with Company’s
procedures, but in no event will any reimbursement be made later than March 15th
of the year following the year in which the expense was incurred.

(c) During the Term, Company agrees to pay Executive for service as Executive
Chairman of the Board an annual retainer of $240,000, payable quarterly. In
addition, Company agrees to grant (by separate documentation) to Executive an
annual equity compensation award consistent with similar awards made to other
members of the Board.

 

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(d) During the Term, Executive agrees to be active in resolution of strategic
issues and opportunities confronting Company, as requested by either the Board
or Company management. Executive agrees to apply his skill and experience to the
performance of his duties and to the business affairs of the Company, and to
serve the Company faithfully, diligently and to the best of his ability.

1.3 Vesting of RSUs.

(a) As of the Effective Date, Executive holds the following restricted stock
unit awards (the “RSU Awards”), granted under the Company’s Amended and Restated
2007 Equity Incentive Plan for Employees and Non-Employee Directors (the “Equity
Incentive Plan”):

 

Grant Date

   RSUs     

Vesting

July 1, 2010

     59,775      

Time based (3 annual, ending July 1, 2013)

April 1, 2011

     30,080      

Performance based (cumulative, ending April 1, 2014)

April 1, 2011

     30,081      

Time based (3 annual, ending April 1, 2014)

June 1, 2012

     71,919      

Time based (3 annual, ending April 1, 2015)

June 1, 2012

     71,918      

Performance based (cumulative, ending April 1, 2015)

(b) The parties hereby agree to waive the provisions specifying that the RSU
Awards are terminated and forfeited upon Executive’s employment termination.
However, the parties agree that the non-vested portion, if any, of such RSU
Awards will be terminated and forfeited if Executive fails to comply with his
obligations as member and Executive Chairman of the Board as described in
Section 1.2 of this Agreement.

(c) To the extent not already provided in the RSU Award agreements, the RSU
Awards will vest on the date of Executive’s death, Disability (as defined in the
RSU Award agreements), or a Change in Control Event (as defined in the Equity
Incentive Plan) and be paid as of the date of vesting consistent with the RSU
Award agreements.

(d) Except to the extent amended above, the terms of the RSU Awards are
unamended, remain in effect and remain subject to the terms of the RSU Award
agreements and the Equity Incentive Plan.

ARTICLE 2.

CONFIDENTIALITY

2.1 Executive will not at any time (1) retain or use for the benefit, purposes
or account of Executive or any other person; or (2) disclose, divulge, reveal,
communicate, share, transfer or provide access to any person outside the Company
(other than Company professional advisers who are bound by confidentiality
obligations), any non-public, proprietary or confidential information —
including without limitation trade secrets, know-how, research and development,
software, databases, inventions, processes, formulae, technology, designs and
other intellectual property, information concerning finances, investments,
profits, pricing, costs, products, services, vendors, customers, clients,
partners, investors, personnel, compensation, recruiting, training, advertising,
sales, government and regulatory activities and approvals — concerning the past,
current or future business, activities and operations of Company and/or any
third party that has disclosed or provided any of same to Company on a
confidential basis (“Confidential Information”) without the prior authorization
of Company.

 

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2.2 “Confidential Information” does not include any information that is
(1) generally known to the industry or the public other than as a result of
Executive’s breach of this covenant; (2) made legitimately available to
Executive without a confidentiality restriction by a third party without breach
of any confidentiality obligation of that third party; or (3) required by law to
be disclosed; provided that Executive shall give prompt written notice to the
Company of such requirement, disclose no more information than is so required,
and cooperate with any attempts by the Company to obtain a protective order or
similar treatment.

2.3 Except as required by law or upon the filing of this Agreement with the
Securities and Exchange Commission, Executive shall not disclose to anyone,
other than Executive’s family and legal or financial advisors, the contents of
this Agreement; provided that Executive may disclose to any prospective future
employer or management recruiter the provisions of this Agreement provided they
agree to maintain the confidentiality of such terms.

2.4 Upon termination of this Agreement for any reason, Executive shall (1) cease
and not thereafter commence use of any Confidential Information or intellectual
property (including without limitation, any patent, invention, copyright, trade
secret, trademark, trade name, logo, domain name or other source indicator)
owned or used by the Company, its subsidiaries or affiliates; (2) immediately
destroy, delete, or return to the Company, at the Company’s option, all
originals and copies in any form or medium (including memoranda, books, papers,
plans, computer files, letters and other data) in Executive’s possession or
control (including any of the foregoing stored or located in Executive’s office,
home, laptop or other computer, whether or not Company property) that contain
Confidential Information or otherwise relate to the business of the Company, its
affiliates and subsidiaries, except that Executive may retain only those
portions of any personal notes, notebooks and diaries that do not contain any
Confidential Information; and (3) notify and fully cooperate with the Company
regarding the delivery or destruction of any other Confidential Information of
which Executive is or becomes aware.

ARTICLE 3.

INTELLECTUAL PROPERTY

If Executive has created, invented, designed, developed, contributed to or
improved any works of authorship, inventions, intellectual property, materials,
documents or other work product (including without limitation, research,
reports, software, databases, systems, applications, presentations, textual
works, content, or audiovisual materials) (“Works”), either alone or with third
parties, during Executive’s service with the Company during the Term or
otherwise, then the Executive hereby grants the Company a perpetual,
non-exclusive, royalty-free, worldwide, assignable, sub-licensable license under
all rights and intellectual property rights (including rights under patent,
industrial property, copyright, trademark, trade secret, unfair competition and
related laws) therein for all purposes in connection with the Company’s current
and future business.

 

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ARTICLE 4.

COVENANT NOT TO COMPETE; NONSOLICITATION

Executive agrees that for a five year period of time beginning on the Effective
Date (the “Restricted Period”), he will not, directly or indirectly, in any
capacity: (i) engage in any business or employment or provide any service or
assistance to aid or assist any person or entity in North America that is in
competition with Company; or (ii) solicit, recruit or induce any employee (as
defined below), consultant, independent contractor, vendor, supplier, customer
(as defined below), or agent to (a) terminate or otherwise adversely affect his
or her employment or other business relationship (or prospective employment or
business relationship) with the Company, or (b) work for Executive or any other
person or entity, other than the Company or its affiliates or related entities.
Executive further agrees that he is not and will not become a party to any
agreement, contract, arrangement or understanding, whether of employment or
otherwise, that would in any way restrict or prohibit him from undertaking or
performing his duties in accordance with this Agreement. Executive acknowledges
that the restrictions set forth above are necessary to protect Company’s
Confidential Information, including but not limited to its trade secrets, and
other legitimate business interests. Executive also acknowledges that the
restrictions are based on his executive role with Company, and that the
restrictions are reasonable in duration and scope. As used in this paragraph,
“employee” means any person who is or was, at any time during Executive’s
service to the Company or during the Restricted Period, an employee of the
Company. “Customer,” as used in this Agreement, means any person or entity that
is or was a customer of the Company at any time during the Restricted Period. If
a court of competent jurisdiction declares any provision of this Agreement
invalid, void, voidable, or unenforceable, the court shall reform such
provision(s) to render the provision(s) enforceable, but only to the extent
absolutely necessary to render the provision(s) enforceable and only in view of
the parties’ express desire that the Company be protected to the greatest
possible extent under applicable law from improper competition and the misuse or
disclosure of trade secrets and Confidential Information. To the extent such a
provision (or portion thereof) may not be reformed so as to make it enforceable,
it may be severed and the remaining provisions shall remain fully enforceable.

ARTICLE 5.

INJUNCTIVE RELIEF

Executive acknowledges that the Company would sustain irreparable harm, not
readily susceptible to valuation in monetary damages, if Executive violates any
of his obligations under Article 3 or Article 4 and therefore, agrees that
Company will be entitled to seek (in addition to any other relief or remedies)
an injunction to be issued by any federal or state court of competent
jurisdiction sitting in the state of Colorado, restraining Executive from
committing or continuing any such violation. Executive hereby submits to the
jurisdiction of such courts for the purposes of any actions or proceedings
instituted by Company to obtain such injunctive relief and agrees that process
may be served upon Executive by registered mail, addressed to the last known
address of Executive, or in any manner authorized by law.

 

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ARTICLE 6.

MISCELLANEOUS

6.1 Assignment. Except as provided below, the rights and obligations of the
Company under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of the Company. Executive acknowledges that his
obligations under this Agreement are personal services and, therefore, Executive
may not assign his obligations under this agreement.

6.2 Enforcement. Failure of either party to enforce any of the provisions of the
Agreement shall not constitute a waiver of rights for that or subsequent
breaches.

6.3 Notices. All notices, requests, demands and other communications hereunder
shall be in writing and shall be delivered personally or sent by registered or
certified mail, prepaid and return receipt requested to the other party hereto
at the mailing address as set forth on the signature page of this Agreement.
Either party may change the address to which such communications hereunder shall
be sent by sending notice of such change to the other party as provided in this
Section.

6.4 Headings. Headings used in this Agreement are for convenience of reference
only and shall not be considered in any interpretation of this Agreement.

6.5 Entire Agreement. This Agreement represents the entire and exclusive
statement of the agreement of the parties and shall not be altered, modified or
amended except by written instrument signed by the parties. Any prior agreements
are superseded except to the extent benefits are presently vested by law and
plan terms.

6.6 Governing Law. This Agreement is made and delivered in the State of
Colorado, and will be interpreted and enforced so as to remain in compliance
with Colorado statutes and regulations.

6.7 Arbitration. Any controversy or claim arising out of or relating to this
Agreement or the breach thereof will be settled by nonbinding arbitration
administered by the American Arbitration Association under its Commercial
Arbitration Rules, and judgment on the award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. This Section 6.7 does not
limit the Company’s right to seek injunctive relief as provided in Article 5.

 

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IN WITNESS WHEREOF, the parties hereto have executed the Agreement as of the
5th day of April, 2013.

 

EXECUTIVE     COMPANY

 

   

 

Keith E. Alessi     By:  

 

Date:  

 

    Title:  

 

      Date:  

 

 

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