EXECUTION VERSION
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
          Registration Rights Agreement, dated as of March 4, 2008, by and among
Westmoreland Coal Company, a Delaware corporation (“Company”), and the
stockholders signatories hereto.
W I T N E S S E T H :
          WHEREAS, this Agreement is being entered into in connection with the
Note Purchase Agreement dated as of March 4, 2008 (the “Note Purchase
Agreement”), between the Company and Tontine Capital Partners, L.P. and certain
of its affiliates (collectively, “Tontine”));
          NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, it is agreed as follows:
          1. Definitions. Unless otherwise defined herein, capitalized terms
used herein and in the recitals above shall have the following meanings:
          “Additional Holders” shall mean (a) any Affiliate of any Holder who
acquires Common Stock or Other Securities and (b) the Permitted Assignees of
Registrable Securities who, from time to time, acquire Registrable Securities
from a Holder or Holders and own Registrable Securities at the relevant time,
agree to be bound by the terms hereof and become Holders for purposes of this
Agreement.
          “Affiliate” of a Person shall mean any Person that directly, or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such other Person. For purposes of this
definition, “control” shall mean the ability of one Person to direct the
management and policies of another Person.
          “Agreement” shall mean this Registration Rights Agreement, including
all amendments, modifications and supplements and any exhibits or schedules to
any of the foregoing, and shall refer to the Agreement as the same may be in
effect at the time such reference becomes operative.
          “Business Day” shall mean any day that is not a Saturday, a Sunday or
a day on which banks are required or permitted to be closed in the State of New
York.
          “Closing Date” shall have the meaning assigned to such term in the
Note Purchase Agreement.
          “Commission” shall mean the Securities and Exchange Commission or any
other federal agency then administering the Securities Act and other federal
securities laws.
          “Common Stock” shall mean the shares of common stock, $2.50 par value
per share, of Company, as adjusted to reflect any merger, consolidation,
recapitalization,

 

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reclassification, split-up, stock dividend, rights offering or reverse stock
split made, declared or effected with respect to the Common Stock.
          “Company” shall have the meaning assigned to such term in the
preamble.
          “Demand Registration” shall have the meaning assigned to such term in
Section 2(b) hereof.
          “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
          “Holder” shall mean (i) any Person who owns Registrable Securities at
the relevant time and is a party to this Agreement or (ii) any Additional
Holder.
          “Majority Holders” shall mean Holders holding at the time, shares of
Registrable Securities representing more than 50% of the then outstanding
Registrable Securities.
          “Note Purchase Agreement” shall have the meaning assigned to such term
in the recitals.
          “Permitted Assignee” shall mean (a) any Affiliate of any Holder who
acquires Registrable Securities from such Holder, or its Affiliates, or (b) any
other Person who acquires any Registrable Securities of any Holder or Holders
who is designated as a Permitted Assignee by such Holder in a written notice to
Company; provided, however, that the rights of any Person designated as a
Permitted Assignee referred to in the foregoing clause (b) shall be limited if,
and to the extent, provided in such notice.
          “Person” shall mean any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
          “Registrable Securities” shall mean the Common Stock of Company owned
by the Holders as of the date hereof or at any time in the future, including
upon conversion of the notes issued pursuant to the Note Purchase Agreement;
and, if as a result of any reclassification, stock dividends or stock splits or
in connection with a combination of shares, recapitalization, merger,
consolidation, sale of all or substantially all of the assets of Company or
other reorganization or other transaction or event, any capital stock, evidence
of indebtedness, warrants, options, rights or other securities (collectively
“Other Securities”) are issued or transferred to a Holder in respect of
Registrable Securities held by the Holder, references herein to Registrable
Securities shall be deemed to include such Other Securities. Shares of Common
Stock and Other Securities that are Registrable Securities shall cease to be
Registrable Securities at such

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time as they become eligible for sale pursuant to Rule 144(b)(i)(1) under the
Securities Act.
          “Securities Act” shall mean the Securities Act of 1933, as amended, or
any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
          “Shelf Registration” means a registration effected pursuant to
Section 2(a) hereof.
          “Shelf Registration Statement” means a “shelf” registration statement
of Company relating to a “shelf” offering in accordance with Rule 415 of the
Securities Act, or any similar rule that may be adopted by the Commission,
pursuant to the provisions of Section 2(a) hereof which covers all of the
Registrable Securities held by the Holders, on an appropriate form under the
Securities Act, and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
          2. Required Registration.
               (a) Company shall use its reasonable best efforts to cause a
Shelf Registration Statement to be filed and declared effective by the
Commission as soon as practicable following the earlier of (i) such time as the
Company is eligible to register its securities on Form S-3 and (ii) thirteen
(13) months after the Closing Date. Each Holder as to which any Shelf
Registration is being effected agrees to furnish to Company all information with
respect to such Holder necessary to make any information previously furnished to
Company by such Holder not misleading. Company agrees to use its reasonable best
efforts to keep the Shelf Registration Statement continuously effective for as
long as any Holder holds Registrable Securities. Company further agrees, if
necessary, to promptly supplement or amend the Shelf Registration Statement, if
required by the rules, regulations or instructions applicable to the
registration form used by Company for such Shelf Registration Statement or by
the Securities Act or by any other rules and regulations thereunder for shelf
registrations, and Company agrees to furnish to the Holders of Registrable
Securities copies of any such supplement or amendment promptly after its being
used or filed with the Commission. In addition, after the Commission has
declared a Shelf Registration Statement effective, so long as such Shelf
Registration Statement is effective and until such time as the Shelf
Registration Statement is a registration statement on Form S-3 (or any successor
thereto), (A) the Company shall promptly file with the Commission any amendment
or supplement to the Shelf Registration Statement as required by the Securities
Act and Exchange Act and the policies, rules and regulations of the Commission,
as announced from time to time, in order to keep the Shelf Registration
Statement effective after each filing by the Company with the Commission
pursuant to the Exchange Act, and (B) no Holder may sell any Common Stock
pursuant to the Shelf Registration Statement until the Commission has declared
effective the Shelf Registration Statement, as amended.

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               (b) At any time following the Closing Date when the Shelf
Registration Statement covering all Registrable Securities is not effective and
after receipt of a written request from the Holders of Registrable Securities
requesting that Company effect a registration under the Securities Act covering
at least 10% of the Registrable Securities outstanding as of the Closing Date (a
“Demand Registration”), and specifying the intended method or methods of
disposition thereof, Company shall promptly notify all Holders in writing of the
receipt of such request and each such Holder, in lieu of exercising its rights
under Section 3 may elect (by written notice sent to Company within 10 Business
Days from the date of such Holder’s receipt of the aforementioned Company’s
notice) to have Registrable Securities included in such Demand Registration
thereof pursuant to this Section 2(b). Thereupon Company shall, as expeditiously
as is possible, use its reasonable best efforts to effect the registration under
the Securities Act of all shares of Registrable Securities which Company has
been so requested to register by such Holders for sale, all to the extent
required to permit the disposition (in accordance with the intended method or
methods thereof, as aforesaid) of the Registrable Securities so registered;
provided, however, that Company shall not be required to effect more than two
(2) registrations of any Registrable Securities pursuant to this Section 2,
unless Company shall be eligible at any time to file a registration statement on
Form S-3 (or other comparable short form) under the Securities Act, in which
event there shall be no limit on the number of such registrations pursuant to
this Section 2.
               (c) A registration will not count as a Demand Registration until
it has become effective (unless the requesting Holders withdraw all their
Registrable Securities and Company has performed its obligations hereunder in
all material respects, in which case such demand will count as a Demand
Registration unless the requesting Holders pay all registration expense in
connection with such withdrawn registration); provided, however, that if, after
it has become effective, an offering of Registrable Securities pursuant to a
registration is interfered with by any stop order, injunction or other order or
requirement of the Commission or other governmental agency or court or is
withdrawn because of any development affecting Company, such registration will
be deemed not to have been effected and will not count as a Demand Registration.
               (d) If the managing underwriter of a Demand Registration shall
advise Company in writing that, in its opinion, the distribution of the
Registrable Securities requested to be included in the Demand Registration would
materially and adversely affect the distribution of such Registrable Securities,
then all selling Holders shall reduce the amount of Registrable Securities each
intended to distribute through such offering on a pro-rata basis.
          3. Incidental Registration. If Company at any time proposes to file on
its behalf and/or on behalf of any of its security holders (the “demanding
security holders”) a registration statement under the Securities Act on any form
(other than a registration statement on Form S-4 or S-8 or any successor form
for securities to be offered in a transaction of the type referred to in
Rule 145 under the Securities Act or to employees of Company pursuant to any
employee benefit plan, respectively) for the general registration

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of securities, it will give written notice to all Holders at least 20 days
before the initial filing with the Commission of such registration statement,
which notice shall set forth the intended method of disposition of the
securities proposed to be registered by Company. The notice shall offer to
include in such filing the aggregate number of shares of Registrable Securities
as such Holders may request.
          Each Holder desiring to have Registrable Securities registered under
this Section 3 shall advise Company in writing within ten (10) Business Days
after the date of receipt of such offer from Company, setting forth the amount
of such Registrable Securities for which registration is requested. Company
shall thereupon include in such filing the number of shares of Registrable
Securities for which registration is so requested, subject to the next sentence,
and shall use its reasonable best efforts to effect registration under the
Securities Act of such shares. If the managing underwriter of a proposed public
offering shall advise Company in writing that, in its opinion, the distribution
of the Registrable Securities requested to be included in the registration
concurrently with the securities being registered by Company or such demanding
security holder would materially and adversely affect the distribution of such
securities by Company or such demanding security holder, then all selling
security holders (including the demanding security holder who initially
requested such registration) shall reduce the amount of securities each intended
to distribute through such offering on a pro-rata basis. Except as otherwise
provided in Section 5, all expenses of such registration shall be borne by
Company.
          4. Registration Procedures. If Company is required by the provisions
of Section 2 or 3 to use its reasonable best efforts to effect the registration
of any of its securities under the Securities Act, Company will, as
expeditiously as possible:
               (a) prepare and file with the Commission a registration statement
with respect to such securities and use its reasonable best efforts to cause
such registration statement to become and remain effective for a period of time
required for the disposition of such securities by the holders thereof, but not
to exceed one hundred eighty (180) days (other than the Shelf Registration
Statement which shall be kept effective for such period as provided in
Section 2(a));
               (b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and
to comply with the provisions of the Securities Act with respect to the sale or
other disposition of all securities covered by such registration statement until
the earlier of such time as all of such securities have been disposed of in a
public offering or the expiration of one hundred eighty (180) days (other than
the Shelf Registration Statement which shall be kept effective for such period
as provided in Section 2(a));
               (c) furnish to such selling security holders such number of
copies of a summary prospectus or other prospectus, including a preliminary
prospectus, in

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conformity with the requirements of the Securities Act, and such other
documents, as such selling security holders may reasonably request;
               (d) use its reasonable best efforts to register or qualify the
securities covered by such registration statement under such other securities or
blue sky laws of such jurisdictions within the United States as each holder of
such securities shall request (provided, however, that Company shall not be
obligated to qualify as a foreign corporation to do business under the laws of
any jurisdiction in which it is not then qualified or to file any general
consent to service of process), and do such other reasonable acts and things as
may be required of it to enable such holder to consummate the disposition in
such jurisdiction of the securities covered by such registration statement;
               (e) promptly notify each Holder whose Registrable Securities are
intended to be covered by such registration statement and each underwriter and,
if requested by any such Person, confirm such notice in writing (i) when a
prospectus or any prospectus supplement or post-effective amendment has been
filed and, with respect to a registration statement or any post-effective
amendment, when the same has become effective, (ii) of the issuance by any state
securities or other regulatory authority of any order suspending the
qualification or exemption from qualification of any of the Registrable
Securities under state securities or “blue sky” laws or the initiation of any
proceedings for that purpose, (iii) any request by the Commission for the
amending or supplementing of such registration statement or prospectus or for
additional information; and (iv) of the happening of any event which makes any
statement made in a registration statement or related prospectus untrue or which
requires the making of any changes in such registration statement, prospectus or
documents so that they will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and, as promptly as reasonably
practicable thereafter, prepare and file with the Commission and furnish a
supplement or amendment to such prospectus so that, as thereafter deliverable to
the purchasers of such Registrable Securities, such prospectus will not contain
any untrue statement of a material fact or omit a material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and the time period during which such registration
statement is required to remain effective shall be extended for the time period
during which such prospectus is so suspended;
               (f) furnish, at the request of any Holder requesting registration
of Registrable Securities pursuant to Section 2, on the date that such shares of
Registrable Securities are delivered to the underwriters for sale pursuant to
such registration or, if such Registrable Securities are not being sold through
underwriters, on the date that the registration statement with respect to such
shares of Registrable Securities becomes effective, (1) an opinion, dated such
date, of the independent counsel representing Company for the purposes of such
registration, addressed to the underwriters, if any, and if such Registrable
Securities are not being sold through underwriters, then to the Holders making
such request, in customary form and covering matters of the type customarily
covered in such legal opinions; and (2) a comfort letter dated such date, from
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independent certified public accountants of Company, addressed to the
underwriters, if any, and if such Registrable Securities are not being sold
through underwriters, then to the Holder making such request and, if such
accountants refuse to deliver such letter to such Holder, then to Company, in a
customary form and covering matters of the type customarily covered by such
comfort letters and as the underwriters or such Holder shall reasonably request.
Such opinion of counsel shall additionally cover such other legal matters with
respect to the registration in respect of which such opinion is being given as
such Holders may reasonably request. Such letter from the independent certified
public accountants shall additionally cover such other financial matters
(including information as to the period ending not more than five (5) Business
Days prior to the date of such letter) with respect to the registration in
respect of which such letter is being given as the Holders of a majority of the
Registrable Securities being so registered may reasonably request;
               (g) enter into customary agreements (including an underwriting
agreement in customary form) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of such Registrable
Securities; and
               (h) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, but not later than
18 months after the effective date of the registration statement, an earnings
statement covering the period of at least twelve (12) months beginning with the
first full month of the Company’s fiscal quarter commencing after the effective
date of such registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act.
          It shall be a condition precedent to the obligation of Company to take
any action pursuant to this Agreement in respect of the securities which are to
be registered at the request of any Holder that such Holder shall furnish to
Company such information regarding the securities held by such Holder and the
intended method of disposition thereof as Company shall reasonably request and
as shall be required in connection with the action taken by Company.
          Each Holder agrees that, upon receipt of any notice from Company of
the happening of any event of the kind described in Section 4(e)(iv), such
Holder shall immediately discontinue such Holder’s disposition of Registrable
Securities pursuant to the registration statement relating to such Registrable
Securities until such Holder’s receipt of the copies of the supplemented or
amended prospectus contemplated by Section 4(e)(iv).
          5. Expenses. All expenses incurred in complying with this Agreement,
including, without limitation, all registration and filing fees (including all
expenses incident to filing with any stock exchange), printing expenses, fees
and disbursements of counsel for Company, the reasonable fees and reasonable
expenses of one counsel for the selling security holders (selected by those
holding a majority of the shares being registered), expenses of any special
audits incident to or required by any such registration

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and expenses of complying with the securities or blue sky laws of any
jurisdiction pursuant to Section 4(d), shall be paid by Company, except that:
               (a) all such expenses in connection with any amendment or
supplement to the registration statement or prospectus filed more than one
hundred eighty (180) days after the effective date of such registration
statement because any Holder has not effected the disposition of the securities
requested to be registered shall be paid by such Holder, other than with respect
to the Shelf Registration; and
               (b) Company shall not be liable for any fees, discounts or
commissions to any underwriter or any fees or disbursements of counsel for any
underwriter in respect of the securities sold by such Holder.
          6. Indemnification and Contribution.
               (a) In the event of any registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, Company shall
indemnify and hold harmless to the fullest extent permitted by law the Holder of
such Registrable Securities, such Holder’s directors and officers, and each
other person (including each underwriter) who participated in the offering of
such Registrable Securities and each other person, if any, who controls such
Holder or such participating person within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
such Holder or any such director or officer or participating person or
controlling person may become subject under the Securities Act or any other
statute or at common law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon (i) any alleged
untrue statement of any material fact contained, on the effective date thereof,
in any registration statement under which such securities were registered under
the Securities Act, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereto, or (ii) any alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse such Holder or such
director, officer or participating person or controlling person for any legal or
any other expenses reasonably incurred by such Holder or such director, officer
or participating person or controlling person in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that Company shall not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon any
actual or alleged untrue statement or actual or alleged omission made in such
registration statement, preliminary prospectus, prospectus or amendment or
supplement in reliance upon and in conformity with written information furnished
to Company by such Holder specifically for use therein or (in the case of any
registration pursuant to Section 2) so furnished for such purposes by any
underwriter. Such indemnity shall remain in full force and effect regardless of
any investigation made by or on behalf of such Holder or such director, officer
or participating person or controlling person, and shall survive the transfer of
such securities by such Holder.

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               (b) Each Holder, by acceptance hereof, agrees to indemnify and
hold harmless to the fullest extent permitted by law Company, its directors and
officers and each other person, if any, who controls Company within the meaning
of the Securities Act against any losses, claims, damages or liabilities, joint
or several, to which Company or any such director or officer or any such person
may become subject under the Securities Act or any other statute or at common
law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon information provided in writing
to Company by such Holder specifically for use in the following documents and
contained, on the effective date thereof, in any registration statement under
which securities were registered under the Securities Act at the request of such
Holder, any preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereto. Notwithstanding the provisions of this
paragraph (b) or paragraph (d) below, no Holder shall be required to indemnify
any person pursuant to this Section 6 or to contribute pursuant to paragraph (d)
below in an amount in excess of the amount of the aggregate net proceeds
received by such Holder in connection with any such registration under the
Securities Act.
               (c) Any Person entitled to indemnification hereunder will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure to give
such notice shall not limit the rights of such Person, except to the extent the
indemnifying party is actually prejudiced thereby) and (ii) unless in such
indemnified party’s reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party; provided, however, that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such Person unless
(A) the indemnifying party has agreed to pay such fees or expenses or (B) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such Person. If such defense is not
assumed by the indemnifying party as permitted hereunder, the indemnifying party
will not be subject to any liability for any settlement made by the indemnified
party without its consent (but such consent will not be unreasonably withheld or
delayed). If such defense is assumed by the indemnifying party pursuant to the
provisions hereof, such indemnifying party shall not settle or otherwise
compromise the applicable claim unless (i) such settlement or compromise
contains a full and unconditional release of the indemnified party or (ii) the
indemnified party otherwise consents in writing, which consent shall not be
unreasonably withheld or delayed. An indemnifying party who is not entitled to,
or elects not to, assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party, a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim, in which event the indemnifying party shall be obligated to pay the
reasonable fees and disbursements of such additional counsel or counsels.

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               (d) If the indemnification provided for in this Section 6 from
the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such indemnifying party or
indemnified parties, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include any legal or other
fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding.
          The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro-rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation.
          7. Certain Limitations on Registration Rights. Notwithstanding the
other provisions of this Agreement:
               (a) Company shall not be obligated to register the Registrable
Securities of any Holder if, in the opinion of counsel to Company reasonably
satisfactory to the Holder and its counsel (or, if the Holder has engaged an
investment banking firm, to such investment banking firm and its counsel), the
sale or other disposition of such Holder’s Registrable Securities, in the manner
proposed by such Holder (or by such investment banking firm), may be effected
without registering such Registrable Securities under the Securities Act.
               (b) Company shall not be obligated to register the Registrable
Securities of any Holder pursuant to Section 2 if Company has had a registration
statement, under which such Holder had a right to have its Registrable
Securities included pursuant to Section 2 or 3, declared effective within six
(6) months prior to the date of the request pursuant to Section 2; provided,
however, that if any Holder elected to have shares of its Registrable Securities
included under such registration statement but some or all of such shares were
excluded pursuant to the penultimate sentence of Section 3, then such six
(6) month period shall be reduced to three (3) months.

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               (c) Company shall have the right to delay the filing or
effectiveness of a registration statement required pursuant to Section 2 hereof
during one or more periods aggregating not more than ninety (90) days in any
twelve (12) month period in the event that (i) Company would, in accordance with
the advice of its counsel, be required to disclose in the prospectus information
not otherwise then required by law to be publicly disclosed and (ii) in the
judgment of Company’s board of directors, there is a reasonable likelihood that
such disclosure, or any other action to be taken in connection with the
prospectus, would materially and adversely affect any existing or prospective
material business situation, transaction or negotiation or otherwise materially
and adversely affect Company.
               (d) In the event that, in the judgment of Company, it is
advisable to suspend use of a prospectus included in a registration statement
filed pursuant to this Agreement, due to pending material developments or other
events that have not yet been publicly disclosed and as to which (i) Company
would, in accordance with the advice of its counsel, be required to disclose in
the prospectus information not otherwise then required by law to be publicly
disclosed and (ii) in the judgment of Company’s board of directors, there is a
reasonable likelihood that such disclosure would materially and adversely affect
any existing or prospective material business situation, transaction or
negotiation or otherwise materially and adversely affect Company, then Company
shall notify all Holders to such effect, and, upon receipt of such notice, each
such Holder shall immediately discontinue any sales of Registrable Securities
pursuant to such registration statement until such Holder has received copies of
a supplemented or amended prospectus or until such Holder is advised in writing
by Company that the then current prospectus may be used and has received copies
of any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such prospectus. Notwithstanding anything to the
contrary herein, Company shall not exercise its rights under this Section 7(d)
to suspend sales of Registrable Securities for a period or periods aggregating
more than ninety (90) days in any twelve (12) month period.
               (e) If an employee of Tontine or an employee of an Affiliate of
Tontine (other than Company) serves as a member of, or observer to, Company’s
board of directors, Tontine and its Affiliates shall not be permitted to sell
any Registrable Securities during such periods that Company has sent written
notice to Tontine and written or electronic notice to Company’s Affiliates and
directors prohibiting them from selling securities of Company due to material
non-public information being available to such parties. Any registration
statement in effect during any such “blackout” period which was filed pursuant
to Section 2 hereof shall be extended for such number of days as Tontine and its
Affiliates are not permitted to sell Registrable Securities pursuant to this
Section 7(e).
               (f) If at any time the Commission takes the position that some or
all of the Registrable Securities may not be included in a registration
statement because (i) the inclusion of such Registrable Securities violates the
provisions of Rule 415 under the Securities Act as a result of the number of
shares included in such registration statement, (ii) the Registrable Securities
cannot be sold as an “at the market offering,”

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and/or (iii) the Registrable Securities may not be sold on a delayed or
continuous basis under Rule 415, the Company shall (A) remove from the
registration statement such portion of the Registrable Securities and/or
(B) agree to such restrictions and limitations on the registration and resale of
the Registrable Securities as the Commission may require to assure the Company’s
compliance with the requirements of Rule 415.
          8. Selection of Managing Underwriters. The managing underwriter or
underwriters for any offering of Registrable Securities to be registered
pursuant to Section 2 shall be selected by the Holders of a majority of the
Registrable Securities being so registered and shall be reasonably acceptable to
Company.
          9. Interpretive Matters. Unless otherwise expressly provided or the
context otherwise requires, for purposes of this Agreement the following rules
of interpretation apply:
               (a) When calculating the period of time before which, within
which or following which any act is to be done or step taken pursuant to this
Agreement, the date that is the reference date in calculating such period is
excluded. If the last day of such period is a non-Business Day, the period in
question ends on the next succeeding Business Day.
               (b) Any reference in this Agreement to gender includes all
genders, and words imparting the singular number also include the plural and
vice versa.
               (c) All references in this Agreement to any “Article,” or
“Section,” are to the corresponding Article or Section of this Agreement.
               (d) The words “herein,” “hereinafter,” “hereof,” and “hereunder”
refer to this Agreement as a whole and not merely to a subdivision in which such
words appear unless the context otherwise requires.
               (e) The word “including” or any variation thereof means
“including, but not limited to,” and does not limit any general statement that
it follows to the specific or similar items or matters immediately following it.
          10. Miscellaneous.
               (a) No Inconsistent Agreements. Company will not hereafter enter
into any agreement with respect to its securities which is inconsistent with the
rights granted to the Holders in this Agreement.
               (b) Remedies. Each Holder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. Company
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Agreement and
hereby agrees to waive the defense in any

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action for specific performance that a remedy at law would be adequate. In any
action or proceeding brought to enforce any provision of this Agreement or where
any provision hereof is validly asserted as a defense, the successful party
shall be entitled to recover reasonable attorneys’ fees in addition to any other
available remedy.
               (c) Amendments and Waivers. Except as otherwise provided herein,
the provisions of this Agreement may not be amended, modified or supplemented,
and waivers or consents to departure from the provisions hereof may not be given
unless Company has obtained the written consent of the Majority Holders.
               (d) Notice Generally. All notices, demands, communications and
deliveries required or permitted by this Agreement shall be made in writing
signed by the party making the same, shall specify the Section of this Agreement
pursuant to which it is given or being made and shall be deemed given or made
(i) on the date delivered if delivered by telecopy or in person, (ii) on the
third (3rd) Business Day after it is mailed if mailed by registered or certified
mail (return receipt requested) (with postage and other fees prepaid) or
(iii) on the day after it is delivered, prepaid, to an overnight express
delivery service that confirms to the sender delivery on such day, as follows:
               (i) If to any Holder, at its last known address appearing on the
books of Company maintained for such purpose.

     (ii)   If to Company, at:         Westmoreland Coal Company
 2 North Cascade Avenue, 14th Floor
Colorado Springs, Colorado 80903
Attention: General Counsel
Telecopy No.: (719) 448-8097         With a copy to:         WilmerHale
 1875 Pennsylvania Avenue NW
Washington, DC 20006
Attention: Michael J. Levitin
Telecopy No.: (202) 663-6363

or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration, delivery or other communication hereunder shall
be deemed to have been duly given or served on the date on which personally
delivered, with receipt acknowledged, telecopied and confirmed by telecopy
answerback or three Business Days after the same shall have been deposited in
the United States mail.

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               (e) Rule 144. So long as Company is subject to the reporting
requirements under the Exchange Act, it shall comply with such requirements so
as to permit sales of Registrable Securities by the holders thereof pursuant to
Rule 144 under the Securities Act.
               (f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties hereto including any person to whom Registrable Securities are
transferred and becomes an Additional Holder in accordance with this Agreement.
               (g) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
               (h) Governing Law; Jurisdiction; Jury Waiver. This Agreement
shall be governed by, construed and enforced in accordance with the laws of the
State of New York without giving effect to the conflict of laws provisions
thereof. Each of the parties hereby submits to personal jurisdiction and waives
any objection as to venue in the County of New York, State of New York. Service
of process on the parties in any action arising out of or relating to this
Agreement shall be effective if mailed to the parties in accordance with
Section 10(d) hereof. The parties hereto waive all right to trial by jury in any
action or proceeding to enforce or defend any rights hereunder.
               (i) Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
               (j) Entire Agreement. This Agreement represents the complete
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to the subject
matter hereof.
               (k) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts (including by
facsimile), each of which when so executed shall be deemed to be an original and
all of which taken together shall constitute one and the same agreement.
               (l) Termination. Company’s obligations under this Agreement shall
cease with respect to any Person when such Person ceases to be a Holder.
Notwithstanding the foregoing, Company’s obligations under Section 5 and
Section 6 shall survive in accordance with their terms.

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          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.

            WESTMORELAND COAL COMPANY
      By:   /s/ Keith E. Alessi         Name:   Keith E. Alessi        Title:  
Chief Executive Officer and President   

Signature Page to Registration Rights Agreement

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              TONTINE CAPITAL PARTNERS, L.P.
      By:   TONTINE CAPITAL MANAGEMENT, L.L.C.,         its general partner     
                By:   /s/ Jeffrey L. Gendell           Name:   Jeffrey L.
Gendell          Title:   Managing Member            TONTINE PARTNERS, L.P.
      By:   TONTINE MANAGEMENT, L.L.C.,         its general partner             
    By:   /s/ Jeffrey L. Gendell           Name:   Jeffrey L. Gendell         
Title:   Managing Member            TONTINE OVERSEAS ASSOCIATES, L.L.C.,
as investment manager to Tontine Overseas Fund, Ltd. and
certain separately managed accounts
      By:   /s/ Jeffrey L. Gendell         Name:   Jeffrey L. Gendell       
Title:   Managing Member            TONTINE CAPITAL MANAGEMENT, L.L.C.
      By:   /s/ Jeffrey L. Gendell         Name:   Jeffrey L. Gendell       
Title:   Managing Member              /s/ Jeffrey L. Gendell       Jeffrey L.
Gendell, as an individual           

Signature Page to Registration Rights Agreement

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