10-K/A 1 c90304e10vkza.htm FORM 10-K/A Form 10-K/A
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Amendment No. 2)
(Mark One)
     
þ   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2008
OR
     
o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from  _____  to  _____ 
Commission File No. 001-11155
WESTMORELAND COAL COMPANY
(Exact name of registrant as specified in its charter)
     
Delaware
(State or other jurisdiction of
incorporation or organization) 		  23-1128670
(I.R.S. Employer Identification No.)
     
2 North Cascade Avenue, 2nd Floor
Colorado Springs, CO
(Address of principal executive offices) 		  80903
(Zip Code)
Registrant’s telephone number, including area code:
(719) 442-2600
Securities registered pursuant to Section 12(b) of the Act:
     
Title of Each Class   Name of Exchange on Which Registered
     
Common Stock, par value $2.50 per share   NYSE Amex
     
Depositary Shares, each representing
one-quarter of a share of Series A Convertible
Exchangeable Preferred Stock		    
     
Preferred Stock Purchase Rights    
Securities registered pursuant to Section 12(g) of the Act:
Series A Convertible Exchangeable Preferred Stock, par value $1.00 per share
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes o          No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes o          No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes þ          No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this 10-K or any amendment to this Form 10-K.
      o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one).
                 
 
  Large accelerated filer   o   Accelerated filer   þ
 
                
 
  Non-accelerated filer   o   Smaller reporting company   o
    (Do not check if a smaller reporting company.)    
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes o          No þ
The aggregate market value of voting common stock held by non-affiliates as of June 30, 2008 was $134,698,392.
There were 9,620,711 shares outstanding of the registrant’s common stock, $2.50 par value per share (the registrant’s only class of common stock), as of March 1, 2009.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement for the 2009 Annual Meeting of Stockholders are incorporated by reference in Part III.
 
 

 

 

 

Explanatory Note
This Amendment No. 2 to the Annual Report of Westmoreland Coal Company (the “Company”) on Form 10-K for the year ended December 31, 2008 (the “Form 10-K”) is being filed in response to certain comments made by the staff of the Securities and Exchange Commission. In response to such comments, we have (i) amended Part II, Item 9A (Controls and Procedures) to include an amended subsection (a) and (ii) filed currently dated certifications of our Chief Executive Officer and Chief Financial Officer as required under the Sarbanes-Oxley Act of 2002. Except as described above, no other change has been made to the Form 10-K, and this Form 10-K/A does not amend, update or change any other Item or the disclosures in the Form 10-K in any way. This Form 10-K/A does not reflect events occurring after the filing of the Form 10-K or modify or update those disclosures, including any exhibits to the Form 10-K affected by subsequent events.

 

 

 

ITEM 9—CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

This item is not applicable.

ITEM 9A—CONTROLS AND PROCEDURES.

(a) Management’s Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and15d-15(f) under the Securities Exchange Act of 1934, as amended. Internal control over financial reporting refers to a process designed by, or under the supervision of, the Chief Executive Officer and Chief Financial Officer and effected by the board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:
  •   pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
 
  •   provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and our board of directors; and
 
  •   provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on our financial statements.
Management evaluated the effectiveness of our internal control over financial reporting as of December 31, 2008, using the framework set forth in the report of the Treadway Commission’s Committee of Sponsoring Organizations or COSO, Internal Control — Integrated Framework. The Public Company Accounting Oversight Board’s Auditing Standard No. 5 defines a material weakness as a control deficiency, or combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In conducting the aforementioned evaluation, we determined that the three material weaknesses in our internal control over financial reporting at December 31, 2007, have been fully remediated.
Based upon management’s evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our internal control over financial reporting, as defined in Rule 13a-15 under the Securities Act of 1934, was effective as of December 31, 2008.

(b) Changes in Internal Control over Financial Reporting

Management has evaluated, with the participation of the Chief Executive Officer and Chief Financial Officer, whether any changes in our internal control over financial reporting that occurred during our last fiscal quarter have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  Based on the evaluation we conducted, management has concluded that no such changes have occurred.

(c) Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders
Westmoreland Coal Company:

We have audited Westmoreland Coal Company’s internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting (Item 9A(a)). Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company has maintained effective internal control over financial reporting as of December 31, 2008, based on the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of the Company as of December 31, 2008 and 2007, and the related consolidated statements of operations, shareholders’ deficit and comprehensive loss, and cash flows for each of the years in the three-year period ended December 31, 2008 and our report dated March 28, 2008 expressed an unqualified opinion on those financial statements.

KPMG LLP

Denver, Colorado
March 13, 2009

(d) Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Annual Report, management performed, with the participation of the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), an evaluation of the effectiveness of the company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Based upon that evaluation, the CEO and the CFO concluded that, as of December 31, 2008, our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified by the SEC, and that such information is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

ITEM 9B—OTHER INFORMATION.

None.

 

 

 

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
         
  WESTMORELAND COAL COMPANY
 		  
Date: September 17, 2009  /s/ Keith E. Alessi    
  Name:   Keith E. Alessi   
  Title:   Chief Executive Officer and President
(A Duly Authorized Officer) 		  
 

 

 

 

EXHIBIT INDEX
                             
        Incorporated by Reference    
Exhibit           File               Filed
Number   Exhibit Description   Form   Number   Exhibit   Filing Date   Herewith
3.1
  Restated Certificate of Incorporation   S-1   333-117709     3.1     7/28/2004    
3.2
  Certificate of Correction to the Restated Certificate of Incorporation   8-K   001-11155     3.1     10/21/2004    
3.3
  Certificate of Amendment to the Restated Certificate of Incorporation   8-K   001-11155     3.1     9/07/2007    
3.4
  Certificate of Amendment to the Restated Certificate of Incorporation   8-K   001-11155     3.2     9/07/2007    
3.5
  Amended and Restated Bylaws   8-K   001-11155     3.1     4/11/2008    
4.1
  Certificate of Designation of Series A Convertible Exchangeable Preferred Stock   10-K   001-11155     3 (a)   3/15/1993    
4.2
  Indenture between Westmoreland Coal Company (“WCC”) and Fidelity Bank National Association relating to the Exchange Debentures   S-1   333-117709     4.2     7/28/2004    
4.3
  Form of Exchange Debenture   S-1   333-117709     4.3     7/28/2004    
4.4
  Deposit Agreement among WCC, First Chicago Trust Company of New York and the Holders   S-1   333-117709     4.4     7/28/2004    
4.5
  Common Stock certificate   S-2   33-1950     4 (c)   12/04/1985    
4.6
  Preferred Stock certificate   S-2   33-47872     4.6     5/13/1992    
4.7
  Form of Depository Receipt   S-1   333-117709     4.5     7/28/2004    
4.8
  Amended and Restated Rights Agreement, dated February 7, 2003, between WCC and EquiServe Trust Company, N.A.   8-K   001-11155     4.1     02/07/2003    
4.9
  First Amendment to Amended and Restated Rights Agreement dated May 2, 2007, between WCC and Computershare Trust Company   8-A   001-11155     (l )   05/04/2007    
4.10
  Second Amendment to Amended and Restated Rights Agreement dated March 4, 2008, between WCC and Computershare Trust Company   8-A   001-11155     (l )   03/06/2008    
4.11
  Warrant dated August 20, 2007, in favor of SOF Investments, L.P.   10-K   001-11155     4.11     03/31/2008    
Other debt instruments are omitted in accordance with Item 601(b)(4)(iii)(A) of Regulation S-K. Copies of such agreements will be furnished to the Securities and Exchange Commission upon request.
10.1*
  1995 Long-Term Incentive
Stock Plan 		  Sch. 14A   001-11155   App. 3   04/28/1995    
10.2*
  2000 Nonemployee Directors’ Stock Incentive Plan   10-K   001-11155     10 (j)   03/05/2001    
10.3*
  First Amendment to 2000 Nonemployee Directors’ Stock Incentive Plan   10-Q   001-11155     10.2     08/14/2003    
10.4*
  2000 Long-Term Incentive
Stock Plan 		  Sch. 14A   001-11155   Annex A   04/20/2000    
10.5*
  Amended and Restated 2000 Performance Unit Plan   10-K   001-11155     10.5     03/13/2009    
10.6*
  2002 Long-Term Incentive
Stock Plan 		  Sch. 14A   001-11155   Annex A   04/23/2002    

 

 

 

                             
        Incorporated by Reference    
Exhibit           File               Filed
Number   Exhibit Description   Form   Number   Exhibit   Filing Date   Herewith
10.7*
  Amended and Restated 2007 Equity Incentive Plan for Employees and Non-Employee Directors (“2007 EIP”)   10-K   001-11155     10.7     03/13/2009    
10.8*
  Form of Incentive Stock Option Agreement under the 2007 EIP   10-Q   001-11155     10.1     05/09/2008    
10.9*
  Form of Nonstatutory Stock Option Agreement for directors under the 2007 EIP   10-Q   001-11155     10.2     05/09/2008    
10.10*
  Form of Nonstatutory Stock Option Agreement for persons other than directors under the 2007 EIP   10-Q   001-11155     10.3     05/09/2008    
10.11*
  Form of Restricted Stock Agreement for directors with time-based vesting under the 2007 EIP   10-K   001-11155     10.11     03/13/2009    
10.12*
  Form of Restricted Stock Agreement for directors under the 2007 EIP   10-K   001-11155     10.12     03/13/2009    
10.13*
  Form of Restricted Stock Agreement for employees under the 2007 EIP   10-K   001-11155     10.13     03/13/2009    
10.14*
  Severance Policy dated January 1, 2009   10-K   001-11155     10.14     03/13/2009    
10.15
  Amended Coal Mining Lease between Westmoreland Resources, Inc. (“WRI”) and Crow Tribe dated November 26, 1974, as amended in 1982   10-Q   0-752     10 (a)   05/15/1992    
10.16
  Amendment to Amended Coal Mining Lease between the Crow Tribe and WRI dated December 2, 1994   10-K   001-11155     10.16     03/13/2009    
10.17
  Exploration and Option to Lease Agreement between the Crow Tribe and WRI dated February 13, 2004 (Confidential materials omitted and filed separately with the SEC. Confidential treatment requested.)   10-K/A   001-11155     10.17     05/08/2009    
10.18
  Master Agreement dated January 4, 1999, between WCC, WRI, Westmoreland Energy, Inc., Westmoreland Terminal Company, and Westmoreland Coal Sales Company, the UMWA 1992 Benefit Plan and its Trustees, the UMWA Combined Benefit Fund and its Trustees, the UMWA 1974 Pension Trust and its Trustees, the United Mine Workers of America, and the Official Committee of Equity Security Holders   8-K   001-11155     99.2     02/04/1999    
10.19
  Amended and Restated Coal Supply Agreement dated August 24, 1998, among The Montana Power Company, et al and Western Energy Company   10-Q/A   001-11155     10.1     07/25/2007    
10.20
  Coal Transportation Agreement dated July 10, 1981, among the Montana Power Company, et al and Western Energy Company   10-Q/A   001-11155     10.2     07/25/2007    

 

 

 

                             
        Incorporated by Reference    
Exhibit           File               Filed
Number   Exhibit Description   Form   Number   Exhibit   Filing Date   Herewith
10.21
  Amendment No. 1 to the Coal Transportation Agreement dated September 14, 1987, among The Montana Power Company, et al and Western Energy Company   10-Q/A   001-11155     10.3     07/25/2007    
10.22
  Amendment No. 2 to the Coal Transportation Agreement dated August 24, 1998, among The Montana Power Company, et al and Western Energy Company   10-Q/A   001-11155     10.4     07/25/2007    
10.23
  Third Amendment and Restatement of the Power Purchase and Operating Agreement between Westmoreland-LG&E Partners and Virginia Electric and Power Company for ROVA I   10-Q   001-11155     10.2     11/06/2006    
10.24
  Second Amendment and Restatement of the Power Purchase and Operating Agreement between Westmoreland-LG&E Partners and Virginia Electric and Power Company for ROVA II   10-Q   001-11155     10.3     11/06/2006    
10.25
  Amended and Restated Lignite Supply Agreement dated September 28, 2007, between NRG Texas Power LLC and Texas Westmoreland Coal Co.   10-Q   001-11155     10.1     03/17/2008    
10.26
  First Amendment to Amended and Restated Lignite Supply Agreement dated June 26, 2008, between Texas Westmoreland Coal Co. and NRG Texas Power LLC   8-K   001-11155     10.9     06/26/2008    
10.27
  Guaranty Agreement dated September 28, 2007, by WCC for the benefit of NRG Texas Power LLC   10-K   001-11155     10.43     03/31/2008    
10.28
  Business Loan Agreement dated October 29, 2007, between WRI and First Interstate Bank   8-K   001-11155     10.1     11/02/2007    
10.29
  Amendment to Business Loan Agreement and Commercial Security Agreement dated October 16, 2008, between First Interstate Bank and WRI   8-K   001-11155     10.5     10/21/2008    
10.30
  Amendment No. 2 to Business Loan Agreement dated November 20, 2008, between First Interstate Bank, WCC and WRI   8-K   001-11155     10.1     11/24/2008    
10.31
  Change in Terms Agreement dated November 20, 2008, between WRI and First Interstate Bank   8-K   001-11155     10.2     11/24/2008    
10.32
  Second Amended and Restated Loan Agreement, dated February 11, 2008, among Westmoreland Partners and Prudential   10-K   001-11155     10.45     03/31/2008    
10.33
  Second Amended and Restated Assignment and Security Agreement, dated February 11, 2008, between Westmoreland Partners and Prudential   10-K   001-11155     10.46     03/31/2008    

 

 

 

                             
        Incorporated by Reference    
Exhibit           File               Filed
Number   Exhibit Description   Form   Number   Exhibit   Filing Date   Herewith
10.34
  Third Amended and Restated General Partner Security and Limited Guaranty Agreement, dated Feb. 11, 2008, among Westmoreland-Roanoke Valley, L.P., Westmoreland-North Carolina Power, LLC and Prudential   10-K   001-11155     10.47     03/31/2008    
10.35
  Senior Secured Convertible Note Purchase Agreement dated March 4, 2008 among WCC and various Tontine entities   8-K   001-11155     10.1     03/06/2008    
10.36
  Registration Rights Agreement dated March 4, 2008, among WCC and various Tontine entities   8-K   001-11155     10.2     03/06/2008    
10.37
  Guaranty dated March 4, 2008, from WRI in favor of Tontine Partners, LP and Tontine Capital Partners, LP   8-K   001-11155     10.3     03/06/2008    
10.38
  Security Agreement dated March 4, 2008, between WRI and Tontine Capital Associates, LP   8-K   001-11155     10.4     03/06/2008    
10.39
  Pledge Agreement dated March 4, 2008, among WCC, WRI and Tontine Capital Associates, LP   8-K   001-11155     10.5     03/06/2008    
10.40
  Note Purchase Agreement dated June 26, 2008 among Westmoreland Mining LLC (“WML”), various of its subsidiaries and institutional investors   8-K   001-11155     10.1     06/26/2008    
10.41
  Continuing Agreement of Guaranty and Suretyship dated June 26, 2008 from various WML subsidiaries for the benefit of the noteholders   8-K   001-11155     10.2     06/26/2008    
10.42
  Security Agreement dated June 26, 2008 among WML, various WML subsidiaries and U.S. Bank NA   8-K   001-11155     10.3     06/26/2008    
10.43
  Pledge Agreement dated June 26, 2008 among WCC, WML and U.S. Bank NA, for the benefit of the noteholders   8-K   001-11155     10.4     06/26/2008    
10.44
  Amended and Restated Credit Agreement dated June 26, 2008 among WML, various WML subsidiaries and PNC Bank, NA   8-K   001-11155     10.5     06/26/2008    
10.45
  Amended and Restated Continuing Agreement of Guaranty and Suretyship dated June 26, 2008 from various WML subsidiaries in favor of PNC Bank, NA   8-K   001-11155     10.6     06/26/2008    
10.46
  Amended and Restated Security Agreement dated June 26, 2008 among WML, various WML subsidiaries, and U.S. Bank NA   8-K   001-11155     10.7     06/26/2008    
10.47
  Amended and Restated Pledge Agreement dated June 26, 2008 among WCC, WML and U.S. Bank NA   8-K   001-11155     10.8     06/26/2008    

 

 

 

                             
        Incorporated by Reference    
Exhibit           File               Filed
Number   Exhibit Description   Form   Number   Exhibit   Filing Date   Herewith
10.48
  Membership Interest Purchase Agreement among WRI, WRI Partners, Inc., Absaloka Coal, LLC and Feedstock Investments IV, LLC dated October 16, 2008   8-K   001-11155     10.1     10/21/2008    
10.49
  Form of Fixed Payment Note   8-K   001-11155     10.3     10/21/2008    
10.50
  Form of Contingent Payment Note   8-K   001-11155     10.4     10/21/2008    
10.51
  Crow Tribal Lands Coal Lease between the Crow Tribe and WRI dated February 13, 2004   10-K/A   001-11155     10.51     05/08/2009    
21.1
  Subsidiaries of WCC   10-K   001-11155     21.1     03/13/2009    
23.1
  Consent of KPMG LLP   10-K   001-11155     23.1     03/13/2009    
23.2
  Consent of KPMG LLP   10-K   001-11155     23.2     03/13/2009    
31.1
  Certification of Chief Executive Officer pursuant to Rule 13a-14(a)                       X
31.2
  Certification of Chief Financial Officer pursuant to Rule 13a-14(a)                       X
32
  Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350   10-K   001-11155     32     03/13/2009