PROXY STATEMENT
OF WESTMORELAND COAL
Securities and Exchange Commission
Washington D.C. 20549
SCHEDULE 14a INFORMATION
Proxy Statement Pursuant to Sections 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [ ]
Filed by a party other than the Registrant [X]
Check the appropriate box:
[X ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or
Rule 14(a)-12
_________________________________________________________________
_
Westmoreland Coal Company
_________________________________________________________________
_
(Name of Registrant as Specified in Its Charter)
Westmoreland Committee To Enhance Share Value
_________________________________________________________________
_
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X ] No Fee Required.
[ ] Fee computer on table below per Exchange Act Rules
14a-6(i)(l) and 0-11.
(1) Title of each class of securities to which
transaction applies:
_________________________________________________________________
_
(2) Aggregate number of securities to which transaction
applies:
_________________________________________________________________
_
(3) Per Unit price or other underlying value of
transaction computer pursuant to Exchange Act Rule 0-11:
_________________________________________________________________
_
(4) Proposed maximum aggregate value of transaction:
_________________________________________________________________
_
(5) Total fee paid:
_________________________________________________________________
____
[ ] Fee paid previously with preliminary proxy materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form of Schedule and
the
date of its filing.
(1) Amount Previously Paid:
_________________________________________________________________
_
(2) Form, Schedule or Registration Statement No.:
_________________________________________________________________
_
(3) Filing Party:
_________________________________________________________________
_
(4) Date Filed:
_________________________________________________________________
_
1 Set forth the amount on which the filing fee is calculated and
state how it was determined.
- -----------------------------------------------------------------
- -
PLEASE VISIT OUR WEB SITE AT
http://www.freedomforshareholders.com
WESTMORELAND COMMITTEE TO ENHANCE SHARE VALUE
IN OPPOSITION TO THE MANAGEMENT
OF WESTMORELAND COAL COMPANY
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the WESTMORELAND
COMMITTEE TO ENHANCE SHARE VALUE (The "Committee") for use at
the 1999 Special Meeting in lieu of an Annual Meeting of
shareholders of Westmoreland Coal Company (the "Company") for
the
purpose of electing a new board of directors opposed to the
present management of the Company. The Committee is a direct
outgrowth of the experience of three of its members who served
as
members (one of whom served as co-chairman) of the Official
Committee of Equity Security Holders (the "Equity Committee")
while the Company was recently under the jurisdiction of
the Federal Bankruptcy Court. Through that experience, they
became
convinced that the present board of directors and management of
the Company have conducted the affairs of the Company in a
manner
which has led to the drastic reduction in the value of the
Company's stock and that if they remain in office, future
deterioration will occur.
One month out from a near-death experience for owners of
Westmoreland Coal Company, Westmoreland management celebrated
with
a round of bonuses -- $2.6 million in cash and outright grants
of
95,000 shares of common stock and 95,000 options for additional
shares.
Westmoreland management has dragged us through a protracted two-
year, high-risk tactical bankruptcy that nearly lost our
company,
incurred nearly $10 million in expenses, and plunged the value
of
our shares to record lows. Management has not purchased equity
or
invested in the future of our company. It has spent 30 percent
of
its tenure under the protection of courts. Its operational track-
record is poor. Its plans for our company are self-serving and
risky.
Westmoreland management is unabashedly asking that we who own
the
company affirm its brazen self-confidence and salaried future by
rewarding it with votes and trust.
[IN PAPER MATERIAL, THE FOLLOWING TABLE OF THE COMPANY'S
STOCK PRICES APPEARS IN GRAPHIC FORM]
The following chart of Common Stock prices demonstrates what
present management has done to share values. (Information taken
from Compuserve.)
<TABLE>
<CAPTION>
WESTMORELAND COAL COMPANY
COM
Cusip: 96087810 Exchange: O Ticker:
WMCL
Month-End Months Months Months
Month-End
Date Volume High/Ask Low/Bid
Close/Avg
- --------- ---------- ---------- ---------- ----------
<S> <C> <C> <C>
<C>
3/29/91 363,800 20 1/4 18 1/2 19 1/4
#
4/30/91 550,200 20 1/2 17 1/2 19 1/2
5/31/91 250,100 21 1/4 19 1/4 20 1/2
6/28/91 140,400 20 3/4 18 1/2 19 1/2
7/31/91 181,900 19 3/4 18 1/2 19 1/2
8/30/91 262,700 22 18 20 3/4
9/30/91 225,300 21 3/4 19 1/4 21
10/31/91 206,200 22 3/4 19 19 1/2
11/29/91 116,600 20 1/2 16 1/2 16 1/2
12/31/91 303,300 21 16 1/2 20 1/4
1/31/92 326,200 21 1/4 16 1/2 17
2/28/92 202,300 18 1/2 15 1/2 16
3/31/92 168,800 17 1/2 16 17 1/2
4/30/92 420,300 18 1/4 16 1/2 17 1/2
5/29/92 164,000 17 1/2 15 3/4 16 1/2
6/30/92 173,600 17 11 3/4 11 3/4
7/31/92 449,200 13 11 1/8 12 5/8
8/31/92 125,000 13 11 3/4 12
9/30/92 174,200 13 1/8 11 7/8 12 1/4
10/30/92 133,800 13 10 5/8 12 1/8
11/30/92 123,100 12 1/8 11 1/8 11 1/8
12/31/92 270,400 11 5/8 10 1/8 11 1/8
1/29/93 318,800 11 1/4 9 1/2 10
2/26/93 336,200 10 3/8 8 1/8 9
3/31/93 204,500 10 3/8 8 1/2 9 3/4
4/30/93 175,200 10 1/2 9 9 1/8
5/31/93 119,700 10 8 1/2 8 5/8 #
6/30/93 845,900 9 1/8 5 3/4 6 1/4
7/30/93 1,123,900 7 3/4 5 5/8 5 7/8
8/31/93 385,300 7 3/8 5 3/8 6 3/4
9/30/93 415,100 7 1/8 5 3/4 6 1/8
10/29/93 582,600 7 1/4 5 5/8 6 3/4
11/30/93 592,700 7 3/8 6 1/4 6 1/2
12/31/93 949,800 6 1/2 5 5 1/4
1/31/94 777,500 5 1/2 4 1/4 5
2/28/94 355,000 5 7/8 4 7/8 5 1/8
3/31/94 325,500 5 3/8 4 5/8 4 3/4
4/29/94 240,000 5 4 3/8 4 1/2
5/31/94 147,100 5 4 1/2 5
6/30/94 148,700 5 1/4 4 5/8 5
7/29/94 554,400 6 4 3/8 5 3/4
8/31/94 385,100 6 3/8 5 5 1/8
9/30/94 137,200 5 1/2 4 5/8 4 15/16
10/31/94 508,400 6 1/2 5 6 1/8
11/30/94 676,700 6 3/4 3 3/4 5 1/4
12/30/94 469,700 7 1/8 4 3/4 6 3/4
1/31/95 107,900 6 3/4 5 3/4 6 1/2
2/28/95 169,200 6 5/8 5 1/4 5 3/8
3/31/95 186,600 5 5/8 4 1/2 4 3/4
4/28/95 258,700 5 1/4 4 3/8 4 3/8
5/31/95 204,300 5 3/8 4 3/8 4 3/4
6/30/95 90,100 5 4 1/4 4 1/4
7/31/95 221,600 4 1/2 3 1/8 4 1/8
8/31/95 282,000 4 1/2 3 5/8 3 3/4
9/29/95 1,034,600 4 2 1/2 3 5/8
10/31/95 365,200 3 3/4 3 1/8 3 1/2
11/30/95 241,200 3 5/8 2 1/2 2 1/2
12/29/95 510,900 3 1/4 2 1/2 2 5/8
1/31/96 259,300 3 1/8 2 1/2 2 5/8
2/29/96 236,500 3 3/8 2 5/8 3 1/4
3/29/96 197,700 3 5/8 2 5/8 2 3/4
4/30/96 132,600 3 1/4 2 5/8 2 7/8
5/31/96 342,600 4 1/4 2 5/8 4
6/28/96 136,000 4 1/4 3 1/8 3 1/2
7/31/96 79,600 3 3/4 2 5/8 3
8/30/96 66,200 3 1/4 2 3/4 3 1/4
9/30/96 96,600 3 1/4 2 3/4 2 3/4
10/31/96 164,300 3 3/8 2 5/8 2 7/8
11/29/96 160,500 3 2 1/4 2 1/2
12/31/96 961,500 2 5/8 1/8 1/2
1/31/97 600,000 1/2 1/2 1/2 #
2/28/97 0 1 3/8 5/8 15/16
3/31/97 1,000 1 1/4 17/32 37/64
4/30/97 0 31/32 17/32 59/64
5/30/97 0 1 3/16 3/4 7/8
6/30/97 0 1 1/16 25/32 1
7/31/97 0 1 1/4 15/16 1 3/32
8/29/97 0 1 31/32 1 1 27/32
9/30/97 38,100 2 5/16 1 11/16 2 7/32
10/31/97 0 2 9/16 1 3/4 1 7/8
11/28/97 0 2 1/16 1 1/8 1 11/32
12/31/97 0 1 1/2 1 1/16 1 5/16
1/30/98 0 2 3/16 1 9/16 2 1/16
2/27/98 0 2 1/8 1 1/4 1 15/32
3/31/98 0 1 15/16 1 3/8 1 25/32
4/30/98 0 2 1 1/2 1 27/32
5/29/98 0 1 27/32 1 3/8 1 15/32
6/30/98 0 1 9/16 1/8 27/64
7/31/98 0 2 35/64 3/8 2 29/64
8/31/98 0 2 3/4 1 5/8 1 11/16
9/30/98 0 1 7/8 1 7/16 1 47/64
10/30/98 0 2 3/16 1 1/2 2 1/32
11/30/98 0 2 3/8 2 2 15/64
12/31/98 0 4 9/16 2 3/16 3 7/8
1/29/99 0 4 9/16 3 13/16 4 1/2
2/26/99 0 4 9/16 3 5/8 3 11/16
3/24/99* 0 4 15/16 3 5/8 4 5/8
* indicates a partial period
# indicates 'last' is from an earlier date in the period
</TABLE>
Now is the time to end the reign of Westmoreland management.
The Westmoreland Committee to Enhance Share Value ("the
Committee") believes that Westmoreland management has a track
record of disregard for the best interests of its owners and
neither the financial incentive nor operational ability
necessary
to reverse its pattern of causing losses for shareholders.
Enough
is enough. Let's move them out and move on.
YOUR FELLOW SHAREHOLDERS ON THE COMMITTEE NEED YOUR VOTES TO
ELECT
OUR ALTERNATIVE SLATE OF DIRECTORS AND ENDORSE OUR PROPOSED
APPROACH FOR RESTORING MARKET CONFIDENCE AND THE VALUE OF OUR
COLLECTIVE SHARE EQUITY IN WESTMORELAND COAL COMPANY.
The Committee's goal is to maximize value for common and
preferred
shareholders by restoring Westmoreland to its nearly 150-year
prominence as a coal producing and marketing enterprise. We
propose retaining independent energy experts to assess
Westmoreland's assets to identify every possible opportunity for
maximizing share value in current and projected market
conditions.
Already, we are building on the analysis produced by independent
analysts Putnam, Hayes & Bartlett, Inc., who worked as financial
advisors to your Equity Committee during Westmoreland's
bankruptcy
proceedings. We have also retained the expert advice of
Bodington
& Company -- a prominent management and financial consulting
firm
serving the electric power industry -- with a record of more
than
90 clients and 250 engagements.
Our preliminary work makes one thing clear: now is the time to
sell Westmoreland's Independent Power Projects (IPPs). As a
first
order of business, the Committee proposes using Bodington &
Company to develop a strategy for obtaining maximum revenues
possible for Westmoreland's remaining IPP assets and retaining
an
investment firm to sell the facilities by the end of 1999.
The Committee's Plan
The following are the five principal elements of the Committee's
plan:
* Enhance shareholders' value through the sale of all IPPs.
The Committee proposes selling Westmoreland's remaining IPPs by
the end of 1999. Net proceeds after payment of a lump sum
settlement to the combined UMWA Funds would be dispersed to
common
and preferred shareholders. Because of the previous success of
the
Equity Committee in working cooperatively with the UMWA Funds,
the
Committee believes it can reach an agreement for the
unencumbered
sale of the IPPs. Independent studies show that a fortuitous
window of opportunity exists for selling Westmoreland's IPP
assets. The current and temporary market environment of under-
capacity in the electricity sector has escalated IPP market
valuations beyond anyone's wildest expectations.
* Enhance shareholders' value through expansion of surface
mining operations. Based on the analysis and advice of our
independent consultant, Putnam, Hayes & Bartlett, the Committee
proposes substantially increasing production and marketing of
Westmoreland's coal assets and negotiating lower rail
transportation rates. There is tremendous growing demand for low
sulfur coal abundantly available in the Powder River Basin.
While
management is only mining less than 7 million tons of coal, the
Westmoreland mine near Hardin, Montana, has proven reserves in
excess 600 million tons. An analysis prepared by RDI in 1994,
for
Westmoreland management projected a demand growth of 30 percent
between 1995 and 2000 in the Northern Powder River Basin, with
29
percent growth projected during the same period for the Southern
portion of the Basin.
* Enhance shareholders' value by closing executive
headquarters. The Committee estimates that excessive corporate
overhead costs could be reduced by several million dollars per
year by reducing the number of Westmoreland's salaried
executives
in Colorado Springs, relinquishing the headquarters space, and
managing the company through its subsidiaries. There are no
Westmoreland operations in or near the resort area of Colorado
Springs, CO.
* Enhance shareholders' value through possible resumption of
Appalachian mining. If independent analysis proves the financial
merits to be sound, the Committee proposes investigating the
feasibility of restoring relations with the UMWA, badly damaged
by
management, and reaching a management-labor agreement to enable
resumption of profitable coal mining operations on Westmoreland
properties that currently lay fallow in the Eastern United
States.
* Enhance shareholders' value with a talented Board capable
of
implementing our plan. The Committee has recruited a proposed
Board of Directors who have a wealth of individual and combined
expertise in the operational skills and judgment necessary to
rapidly maximize the value of Westmoreland's assets and
shareholders' equity. As evidenced by their resumes, our team
has
a proven track record in turning around companies in crisis.
Their
skills and experience include asset valuation, mergers,
acquisitions, consolidations, sales, marketing, management, and
labor relations _ as well as extensive experience in the energy
power sector.
The Westmoreland Committee to Enhance Share Value
The Committee is an outgrowth of the Official Committee of
Equity
Security Holders (the "Equity Committee") that was selected and
appointed, June, 29, 1998, by the office of the United States
Trustee in the Westmoreland bankruptcy case to protect the
rights
and interests of common and preferred shareholders. In
accordance
with the terms of the bankruptcy settlement contained in the
Master Agreement, the Equity Committee was dissolved February 4,
1999.
As part of its slate of proposed directors, the Committee is
nominating three Westmoreland shareholders who served on the
Equity Committee: Frank Williams, who served as Co-Chair, Nelson
Obus, and Bentley Offutt. These and all members of the Equity
Committee served on behalf of shareholders' rights and interests
without compensation during their 7-month tenure.
During the course of bankruptcy proceedings, Westmoreland
management proposed a reorganization plan giving the UMWA Health
and Retirement Funds (the "Funds") an equity position in the
company and reallocating the balance of the stock between
existing
common and preferred shareholders. The Funds proposed a
reorganization plan that would have transferred all the equity
in
a new corporation to the Funds. The Equity Committee filed a
third
alternative plan to convert the Chapter 11 proceedings to a
Chapter 7 liquidation, which would have satisfied obligations to
the Funds and creditors, with ample funds remaining for
distribution to common and preferred shareholders. Management
subsequently filed a motion to dismiss, resulting in the Master
Agreement -- a negotiated three-party consensual settlement
among
management, the Funds, and the Equity Committee.
Westmoreland Management's Plan
When you hear about management's plan for the future of
Westmoreland Coal Company, ask yourself two questions: (1)
what's
in it for them; and (2) what's in it for us, as owners. Then
take
a look at management's purchased-equity interests and their
operational track record.
According to shareholders, including members of the Committee,
who
have talked with Westmoreland management since the dismissal of
the bankruptcy case, management views the future of our company
as
one involving growth through acquisition. They intend to get
there
the only way they can: by leveraging our IPPs. They need the
income streams from our IPPs to pursue their risky and unsound
strategies to diversify into areas where they have no
operational
experience. So, can we trust their judgment if they tell us that
now is not the prudent time to sell our IPPs _ when the market
resoundingly tells us otherwise?
Westmoreland Management's Track Record
Management of our company has neither the performance track
record
nor the equity incentives necessary to accomplish the task of
maximizing value for common and preferred shareholders.
* Earlier this year, senior management awarded itself $2.6
million in cash bonuses and grants of 95,000 shares of common
stock and 95,000 options for additional shares. The stock award
violates the spirit, if not the letter, of the Master Agreement
that resulted in the dismissal of the bankruptcy case;
* During the 7-year tenure of management, our share prices
plummeted to record lows;
* During five years of its 7-year tenure, management made no
dividend payments to preferred shareholders;
* Senior management has not purchased an equity stake in the
future of our company;
* The one acquisition launched by current management, in the
extremely promising and profitable area of industrial gas
turbines
(the Corona acquisition), was a complete disaster _ a loss of
several million dollars due to management's operational
incompetence in assimilating the acquisition;
* The current management had nothing to do with acquiring
our
most profitable asset: the IPPs;
* Current management's 7-year tenure has been plagued by
costly, acrimonious relations with unions;
* Thirty percent of the 7-year tenure of salaried management
has been under the protection of bankruptcy courts:
* Westmoreland's most recent bankruptcy, lasting a
protracted
two years, is the second bankruptcy spear-headed by management
over their 7-year tenure;
* The latest episode in bankruptcy cost us nearly $10
million
in litigation-related expenses;
* In a series of ill-chosen litigation tactics, designed to
improve its position with regards to obligations owed to UMWA
Funds, management nearly lost our company in its entirety to the
UMWA;
* At trial before the bankruptcy Court, management was not
sufficiently competent to persuade the court to accept the
testimony of its most important witness who would have spoken to
the merits of managed care in maintaining quality of care for
workers, while reducing our operational costs;
* All would have been lost for us as shareholders, but for a
timely decision in another case (Sunnyside) which fortuitously
intervened as precedent in our case _ pure luck;
* As evidenced by its consensual agreement (Master
Agreement)
permitting the dismissal of its bankruptcy case, management
gained
nothing for shareholders. All of the provisions in the Agreement
that favor shareholders _ the tender offer, no anti-shareholder
rights actions, freeze on acquisitions, etc. _ were only agreed
to
by management at the insistence of the Equity Committee.
Enough is Enough -- Vote for Change
The Election of Directors
About Your Vote
Holders of Common Stock have one vote for each share with
respect
to all matters to be considered at the Special Meeting, except
that they will have no vote on the election of the two directors
who are nominated to serve as representatives of the holders of
the Preferred Stock (each such share of Preferred Stock being
evidenced by four Depository Shares). Holders of Depository
Shares have one vote for each Depository Share on all matters to
be considered.
The Company's By-laws, filed as an Exhibit to the annual report
for the Fiscal Year Ended December 31, 1998, on Form 10K/A,
provide that there shall be six directors. However, due to the
Company's failure to pay six quarterly dividend payments on
Preferred Stock, two directors will be elected solely by the
holders of Depository Shares, voting as a separate class. The
remaining directors will be elected by both the Common Stock
holders and Depository Shareholders, voting as a single class.
If
the Committee succeeds in electing its nominees, it intends that
the directors will amend the By-laws to provide for seven,
rather
than six, directors. Consequently, it has nominated the seven
persons named below.
No shareholder is permitted to cumulate votes at the meeting or
by
proxy. Directors will be elected by an affirmative vote of a
plurality of the shares present in person or by proxy and
entitled
to vote on the nominees. The two nominees for the Preferred
Stock
directorships who receive the most votes of the Depository
Shareholders will be elected and the At-large nominees who
receive
the most votes of both the Common Stockholders and the
Depository
Shareholders combined will be elected.
The Committee is presenting the nominees in the form of two
proposals: Proposal Number 1 is that the Committee's two
Preferred Stock Nominees be elected as Directors to serve as
representatives of the Preferred Stockholders; Proposal Number 2
is that the five persons named below as At-large Nominees be
elected to serve as the remaining Directors.
If you own Depository Shares you will find enclosed a BLUE proxy
containing means to vote FOR or WITHHOLD authority to vote for
Proposals 1 and 2. If you own only Common Stock, you will find
a
BLUE proxy containing means for you to vote FOR or withhold
authority to vote for Proposal Number 2.
THE COMMITTEE URGES YOU TO VOTE FOR THE PROPOSALS.
The Committee's Nominees
Information about the Committee's nominees follows. Each nominee
has consented to being named as such.
As Preferred Stockholder Nominees
Guy O. Dove, III, age 61, is a Personal Investor, Washington, DC
(since 1989). He also serves as Chairman of Pinnacle Oil Company
(exploration and production of natural gas and oil), assets
mainly
in Oklahoma (since 1972). Previously, Mr. Dove was Partner and
Chief Investment Officer, The Clarendon Group, London, England,
where he was responsible for all facets of investment management
of a $3 billion reinsurance group. Prior positions included:
First
Vice President, Schroder Capital Management, Inc., Washington,
DC,
and Bond Manager responsible for the National Fixed Income
Department, having more than $100MM in funds under management;
Vice President, Equitable Trust Company, Baltimore, MD, and
Senior
Bond Manager in the Pension Fund Department responsible for
fixed
income portfolios, managing more than $400 MM in funds; and
Financial Consultant, Federal Energy Administration, Washington,
DC. Projects with FEA included evaluating financial problems
relating to the electric utility industry and the impact of
financial markets of various policy options. Trinity College _
BA.
William J. Sim, age 54, is Group Vice President _ Generation of
Potomac Electric Power Company (Pepco), Washington DC (since
1997). At Pepco, Mr. Sim has full profit and loss responsibility
for all of generation activities. In addition, he manages all
aspects of the Generation Business Unit, including fuels
procurement (coal, oil, and gas), operations and maintenance of
generating plants, the Central Engineering and Maintenance
Organization, the Business Planning, and the Power Marketing
Business. Mr. Sim is leading the divestiture team to sell
6000MWs
of power plants as part of an industry restructuring and
stranded
cost settlement. He developed the Power Marketing Group and
developed risk management strategies that saved customers in
excess of $30 million in 1998. Additional accomplishments have
included: negotiated a multi-skilling agreement and reduction in
force with Local 1900 IBEW; moved planned and unplanned
maintenance from plants to a central organization, concentrating
plant personnel on manufacturing electricity; and reduced fuel
cost 10 to 20 percent at plants by modifying plants to burn
different fuels and negotiating new agreements with railroads on
delivery. Mr. Sim serves as a Member, Board of Directors,
Williams
Industries, Falls Church, VA. Previously, he was Group Vice
President _ Power Supply and Delivery, Pepco (1994 to 1997),
where
he managed all aspects of generation, transmission, and
distribution operations including: generating plants, overhead
and
underground systems, substations, the Consolidated Control
Center,
and the Environment Group. While there, he assisted in
negotiating
the merger of Pepco and BGE and developed synergies. In
addition,
he worked as Vice President _ Operations and Construction, Pepco
(1991 to1994) where he managed operation, maintenance, and
construction of Generating, Transmission, Distribution, and
Substations facilities and the Consolidated Control Center. Mr.
Sim also served previously as President and COO _ American
Energy
Division of Potomac Capital Investment Corporation, American
Energy &American Recovery Corporation, a division of Potomac
Capital Investment Corporation (PCI), the non-regulated
subsidiary
of Pepco. In that position, he managed operations involved in
the
ownership, design, construction, and operations of energy
facilities, including: solar, hydro, waste-to-energy, co-
generation projects, and waste recycling. He also developed and
implemented plans for Pepco to enter independent power
businesses
through PCI, including market analysis and staffing, and
negotiated joint ventures with German, French, and Italian
companies to obtain exclusive rights to technologies. Loyola
College _ MBA. University of Glasgow, Scotland _ BSc, Civil
Engineering. University of Michigan _ Public Utility Executive
Program. Mr. Sim owns 100 Depository Shares.
As At-Large Nominees
Robert F. Fowler, age 55, is the Managing Member of Robert
Fowler
& Associates, LLC (management consulting company, specializing
in
divestitures and mergers, serving as owner-representative),
Atlanta, GA (since 1977). Currently, Mr. Fowler is serving as
temporary CFO for the Boomershine Auto Group (a $250 million
annual revenue, multi-dealership), with operations in Atlanta,
GA,
where he is winding down all facets of the corporation and
selling
off its assets. He is past Chairman of the Board of Signal Point
Systems (a full service telecom contractor) and a past Member of
the Board of EMCUS, Inc. (union industrial electrical contractor
holding company). Previously, Mr. Fowler worked as Senior
Consultant, FMI Corporation (management consulting company that
is
a leading advisor in corporate divestitures and mergers),
Raleigh,
NC, and Corporate Planner _ Holding Company, NationsBank,
Charlotte, NC. His role with NationsBank included developing a
five-year earnings forecasting model that became the foundation
for the birth of NationsBank. Wharton _ MBA _ International
Business and Finance. Virginia Military Institute _ BS _ Civil
Engineering and Mathematics. Mr. Fowler owns 100 shares of
Common
Stock.
Nelson Obus, age 52, is President of Wynnefield Capital, LLC (a
private partnership with assets over $150 million, specializing
in
undervalued publicly-traded small companies), New York, NY
(since
1992). Mr. Obus served as a Member of the Westmoreland Official
Committee of Equity Security Holders (June 1998 to February
1999.
Previously, he was Research Director for Schaffer Capital
Management and earlier was with Lazard Freres Brothers, LLC
(institutional equity sales) as Director of Research,
Institutional Salesman, and Research Analyst (in succession).
Prior to his positions on Wall Street, Mr. Obus worked for more
than a decade in natural resources management with the
Massachusetts Audubon Society, the Appalachian Mountain Club,
and
the Department of Environmental Management of the Commonwealth
of
Massachusetts. New York University _ BA. Brandeis University _
MA,
ABD _ political science.
R. Bentley Offutt, age 60, is Founder and President of Offutt
Securities, Inc., a member of the NASD (institutional research
brokerage firm which specializes in value investing and focuses
its coverage on companies with a market capitalization between
$60
million to $1 billion), Baltimore, MD (since 1987). Previously,
he
was Director, Institutional Research and Marketing, Legg Mason.
Mr. Offutt served as a Member of the Westmoreland Official
Committee of Equity Security Holders (June 1998 to February
1999).
In addition, he is a Member of the Board, Williams Industries,
Inc., Falls Church, VA (since 1994). Previously, he was Vice
Chairman, Franklin Square Hospital, Maryland. George Washington
University _ MBA. Lehigh University _ BA.
Matthew S. Sakurada, age 47, is President of EmPower Resources,
Inc. (management consulting and investment company), Sanford, NC
(since 1996). Clients have included Westmoreland Energy,
Westmoreland LG&E Partners, and Energy Power (London, England).
For Westmoreland Energy, Mr. Sakurada was engaged in strategic
planning; for Westmoreland LG&E, he represented the partnership
in
a successful suit against VA Power regarding payment of forced
outage days. For Energy Power, Mr. Sakurada created a successful
$1 billion proposal for British Petroleum refinery. Previously,
he
was President, Vice President and General Manager, and Vice
President _ Project Development (in succession), Westmoreland
Energy, Inc., Charlottesville, VA (1988 to 1996). There, he led
corporate and project development and was responsible for site
selection, fuel procurement, permitting, financing,
construction,
coal marketing, and operation of eight power-generating
facilities
owned in partnership with other leading companies. Prior to
holding those positions, he was Manager of Material, Engineering
and Human Resources, Engineering Manager, and Civil Engineer (in
succession), Colorado Westmoreland, Inc., Paonia, CO. There, Mr.
Sakurada was responsible for the material management,
engineering,
and human resources departments. In addition, he worked as
Engineer --Structural Mechanics, Engineer _ Structural Division,
and Structural Designer (in succession), Stone & Webster
Engineering Corp., Boston, MA, and Denver, CO, where he
engineered
and designed coal-fired, hydro-electric, nuclear, and natural
gas
powered generation facilities. James Madison University _ MBA.
University of Colorado at Denver _ Master of Engineering.
Colorado
State University _ BS _ Civil Engineering. Mr. Sakurada owns
110
shares of Common Stock.
Frank E. Williams, Jr., age 64, is Founder, Chairman, and CEO of
Williams & Beasley Co. (steel erection), Dallas, TX (since
1996).
He is also Chairman of Williams Enterprises of Georgia, Inc.
(steel fabrication and erection of structural steel and
miscellaneous iron _ not affiliated with previous company
listed)
and its five subsidiaries, Atlanta, GA (since 1967). He served
as
Co-Chairman of the Westmoreland Official Committee of Equity
Security Holders (June 1998 to February 1999). Previously, he
was
President, CEO, and Chairman, of Williams Industries, Inc.
(construction services), Falls Church, VA (1961 to 1995).
Previously, he also served as a Director and Chairman of the
Board, Capital Bank NA, Washington, DC. Georgia Institute of
Technology _ Bachelor of Civil Engineering.
The Westmoreland Committee to Enhance Share Value
The Committee is an outgrowth of the Official Committee of
Equity
Security Holders (the "Equity Committee") that was formed on
June
29, 1998, when the Office of the United States Trustee granted
certain shareholders' request to appoint a committee to
represent
the interests of common and preferred shareholders. Following
the
dismissal of the bankruptcy case, the Equity Committee was
dissolved February 4, 1999. In early March 1999, three of the
former members of the Equity Committee, Frank E. Williams, Jr.,
Nelson Obus, and R. Bentley Offutt joined with a fourth
shareholder, Guy O. Dove III, to form the Westmoreland Committee
to Enhance Share Value. More detailed information about each of
these persons is set forth below.
1).....Frank E. Williams, Jr., 2789 Hartland Road, Falls Church,
Virginia 22043. His principal occupation is Chairman of the
Board
of Williams Enterprises of Georgia, whose principal business is
steel construction and whose address is 1285 Hawthorne Ave.,
P.O.
Box 756, Smyrna, Georgia 30081. Mr. Williams beneficially owns,
directly and indirectly, 211,000 shares of Common Stock and
38,000
Depository Shares. Under Securities and Exchange Commission
rules,
the 38,000 Depository Shares are considered to constitute
beneficial ownership of 64,893 shares of Common Stock into which
they are convertible ("Equivalent Shares"), giving Mr. Williams
a
total beneficial ownership of 275,893 shares of Common Stock.
Mr.
Williams owns no shares of stock of record which he does not
also
beneficially own. Certain of the shares set forth as being
beneficially owned by Mr. Williams are owned by his wife,
father,
a family charitable foundation, and a family trust. No
associates
of Mr. Williams, other than the members of the Committee and the
family members, own any of the Company's securities. All of
these
shares have been purchased during the past two years as follows:
<TABLE>
Date Number of Shares Type of
Security
<S> <C> <C>
April 28, 1997 20,000 Common
April 30, 1997 5,000 Common
May 1, 1997 10,000 Common
February 19, 1998 5,000 Common
April 2, 1998 12,000 Common
April 28, 1998 5,000 Common
April 29, 1998 16,000 Common
June 12, 1998 135,000 Common
July 27, 1998 4,000 Depository
October 1, 1998 34,000 Depository
</TABLE>
On September 3, 1998, Mr. Williams sold 15,000 shares of Common
Stock.
Mr. Williams has sold no shares in the past two years, but
intends to tender his Depository Shares to the Company.
2) R. Bentley Offutt, Offutt Securities, Inc., 11350
McCormick
Road, Executive Plaza III, Suite 901, Hunt Valley, Maryland
21030.
His principal occupation is President of Offutt Securities,
Inc.,
a member firm of the National Association of Securities Dealers
(NASD), acting primarily as an institutional research brokerage
firm specializing in companies with market capitalization
between
$60 million to $1 billion. Mr. Offutt beneficially owns199,400
shares of Common Stock and no Depository Shares. Of these,
40,000
shares were purchased on November 10, 1997; the remainder had
been
purchased more than two years ago. Of thisCommon Stock, 149,400
shares are owned by his wife, with whom Mr. Offutt shares
voting
and dispositive power, and 50,000 shares are owned by Offutt
securities. Mr. Offutt owns no Westmoreland securities of record
which he does not also beneficially own. No associates of Mr.
Offutt, other than the members of the Committee and his wife,
own
any of the Company's securities.
3) Nelson Obus, One Penn Plaza, Suite 4720, New York, New
York
10119. Mr. Obus' principal occupation is managing investments as
President of Wynnefield Capital Management, LLC, of that
address.
Wynnefield Capital Management, LLC is a private limited
liability
company organized under the laws of New York. Mr. Obus is the
indirect owner of 693,900 shares of Common Stock and 51,100
Depository Shares, through the following entities: Wynnefield
Partners Small Cap Value L.P. I, a Delaware limited partnership
("Partnership I") _ 229,947 shares of Common Stock and 20,400
Depository Shares; Wynnefield Partners Small Cap Value L.P., a
Delaware limited partnership ("Partnership")-332,253 shares of
Common Stock and 17,000 Depository Shares; Wynnefield Small Cap
Offshore Fund Ltd., a partnership organized under the laws of
the
Cayman Islands ("Offshore Fund") _ 131,700 shares of Common
Stock
and 13,700 Depository Shares. Wynnefield Capital Management, LLC
is the general partner of Partnership and Partnership I, and
Wynnefield Capital, Inc., a Delaware corporation is the general
partner of Offshore Fund. Mr. Obus, Joshua H. Landes and Robert
Melnick are the members of the Wynnefield Capital Management,
LLC,
and Messrs. Obus and Landes are the stockholders, directors and
officers of Wynnefield Capital, Inc. All of these persons and
entities share the address set forth above. Mr. Obus is not the
record owner of any Westmoreland securities of which he is not
also a beneficial owner. During the past two years, the
partnerships have had the following transactions in Westmoreland
securities:
Partnership I - Purchased 17,345 Common on April 11, 1997
Purchased 64,500 Common on March 9, 1998
Purchased 20,400 Depository Shares on
September 2, 1998
Sold 19,000 Common on September 2, 1998
Partnership - Purchased 32,655 Common on April 1, 1997
Purchased 13,100 Depository Shares on
September 2, 1998
Purchased 3,900 Depository Shares on
September 3, 1998
Sold 15,000 Common on September 2, 1998
Offshore Fund- Purchased 131,700 Common on April 11, 1997
Purchased 4,700 Depository Shares on
June 1, 1998
Purchased 9,000 Depository Shares on
September 4, 1998
Sold 8,300 Common on September 2, 1998
Mr. Obus intends to tender his Depository Shares to the Company.
4) Guy O. Dove, III, 10 Jay Street, Middleburg, Virginia 20118.
Mr. Dove's occupation is Personal Investor and Chairman of the
Board of Directors of Pinnacle Oil Company of the same address,
with assets mainly in Oklahoma. Mr. Dove is the beneficial owner
of 198,000 shares of Common Stock and 30,000 Depository Shares,
giving Mr. Dove a total beneficial ownership of 242,154
Equivalent
Shares of Common Stock. He owns no Westmoreland securities of
record which he does not beneficially own. 10,000 Depository
Shares set forth above are owned by his adult children, whom
Mr.
Dove advises as to voting and dispositive powers. 184,000 shares
of Common Stock and 15,000 Depository Shares are owned directly
by
him, and 14,000 shares of Common Stock and 5,000 Depository
Shares
are owned by Pinnacle. Neither Mr. Dove nor Pinnacle has sold
any
Westmoreland stock during the past two years. Mr. Dove
purchased
35,000 shares of Common Stock on October 28, 1998, 3,000 on
November 11, 1998, 1,000 on November 12, 1998, 40,000 on
December
21, 1998 and 5,000 on January 13, 1999. On November 13, 1998,
he
purchased 2,000 Depository Shares. Other than the associates
set
forth above, no associates of Mr. Dove own any Westmoreland
securities.
The Committee as a group directly and indirectly owns 1,302,800
shares of Common Stock and 119,100 Depository Shares, or
1,506,187
Equivalent Shares of Common Stock. No member of the Committee or
any of their associates has any arrangement or understanding
with
any person with respect to future employment with the Company
nor
with respect to any future transactions to which the Company or
any of its affiliates will be a party, except, of course, as the
members of the Committee itself intend to implement its plans as
outlined in this proxy statement. Other than their entering into
the Master Agreement, as members of the Equity Committee, no
member of the Committee is, or was within the past year, a party
to any contract, arrangements or understandings with any person
with respect to any securities of the Company, including, but
not
limited to, joint ventures, loan or option arrangements, puts or
calls, guarantees against loss or guarantees of profit, division
of losses or profits, or the giving or withholding of proxies.
The Solicitation
This proxy statement is first being given or sent to
shareholders
on or about April __, 1999. Any shareholder who executes and
delivers a proxy for use at the Special Meeting has the right to
revoke it any time by filing with the Committee at 2789 Hartland
Road, Falls Church, Virginia 22043, or with the Secretary of the
Company at its principal offices, an instrument revoking it or a
duly executed proxy bearing a later date, or by appearing in
person and voting at the annual meeting. The principal executive
offices of the Company are located at 2 North Cascade Avenue,
14th
Floor, Colorado Springs, Colorado 80903, and its phone number is
(719) 442-2600.
The Company has set the time and date of the Special Meeting in
lieu of the Annual Meeting as ____ , May 11, 1999. The meeting
will be held at _____________. The record date for the Common
Stock is March 23, 1999, and for the Depository Shares the
record
date is April 12, 1999. Only shareholders of record, as
applicable, on those respective dates will entitled to vote at
the special meeting.
The Company's annual report on Form 10-K for the Fiscal Year
Ended
December 31, 1998, discloses that on February 1, 1999, there
were
6,965,328 shares of Common Stock and 2,300,000 Depository Shares
outstanding. The Company has, however, made a tender offer for
1,052,631 Depository Shares, so it is likely that the number of
outstanding Depository Shares will be significantly reduced by
the
record date.
Solicitation Expenses
The Committee has retained D. F. King & Co., Inc. to assist in
the
solicitation of proxies and for related services. The Committee
has agreed to pay that organization a fee estimated at $25,000,
and to reimburse it for reasonable out-of-pocket expenses.
Approximately 20 persons will be used by D.F. King in its
solicitation efforts. In addition to the use of mails, proxies
may
be solicited by the Committee and the director nominees by
telephone, telegram, and personal solicitation, for which no
additional compensation will be paid to those persons engaged in
such solicitation. Banks, brokerage houses and other custodians,
nominees and fiduciaries will be requested to forward
solicitation
material to the beneficial owners of the Common Stock and
Preferred Stock that such institutions hold of record. The
Committee will reimburse such institutions for their reasonable
out-of-pocket expenses.
The expense of preparing and mailing this Proxy Statement and
any
other soliciting material and the total expenditures relating to
the solicitation of proxies (including, without limitation,
costs,
if any, related to advertising, printing, fees of attorneys,
financial advisors, solicitors, consultants, public relations,
transportation, and litigation) will be borne by the Committee,
with a portion of the money provided by the UMWA Health and
Retirement Funds.
The Committee estimates that its total expenditures relating to
the solicitation of proxies will be approximately $200,000.
Total
cash expenditures to-date relating to this solicitation have
been
approximately $10,000. It is the Committee's position that its
actions with respect to the solicitation of proxies will enhance
the value of the Company for the benefit of its stockholders.
While the Committee presently intends to seek reimbursement from
the Company for its reasonable expenses in connection with this
solicitation, the Committee does not expect to submit such
matter
to a vote of security holders, unless required by law.
How to Contact Us
WE ARE RECRUITING YOUR SUPPORT. To offer your support or learn
how
you can help, please contact us:
Frank Williams (703) 641-4612 (703) 641-9082 (fax)
Nelson Obus (212) 760-0134 (212) 760-0824 (fax)
[email protected]
Bentley Offutt (410) 584-9600 (410) 584-7044 (fax)
[email protected]
Guy Dove (540) 687-6351 (540) 687-6714 (fax)
Robert Fowler (770) 618-7284 (770) 618-7142 (fax)
Matthew Sakurada (919) 776-9985 (919) 776-9985 (fax)
[email protected]
William Sim (202) 872-2211 (202) 331-6181 (fax)
[email protected]
FOR ADDITIONAL INFORMATION, PLEASE VISIT OUR WEBSITE AT : FOR
ADDITIONAL INFORMATION, PLEASE VISIT OUR WEBSITE AT :
http://www.freedomforshareholders.com
The website will publish the Bodington & Company analysis for
obtaining maximum revenues possible from the sale of
Westmoreland's IPPs. In addition, the website will include our
SEC
Schedule 13D and proxy filings, concerned shareholders' letters,
and indications of further support for our cause to remove
Westmoreland management.
JOIN US.
About Your Vote
Carefully review this proxy statement. YOUR PROXY IS IMPORTANT.
IF YOU ARE UNABLE TO ATTEND THE SPECIAL MEETING, YOUR PROXY IS
THE
ONLY MEANS AVAILABLE FOR YOU TO VOTE. No matter how many or how
few shares you own, please vote FOR the Committee's nominees for
director by promptly signing, marking, and dating the enclosed
BLUE proxy.
If you own shares of the Company, but your stock certificate is
held for you by a brokerage firm, bank, or other institution, it
is very likely that the stock certificate is actually in the
name
of such institution. If so, only that institution can execute a
BLUE proxy and vote your shares of stock. The institution
holding
your shares for you is required to forward proxy materials to
you
and solicit your instructions with respect to the granting of
proxies.
IT CANNOT VOTE YOUR SHARES UNLESS IT RECEIVES YOUR SPECIFIC
INSTRUCTIONS.
Appendix _ Preliminary Form of Proxy for Depository Shares
(A Blue Card)
- -----------------------------------------------------------------
- -
NON-MANAGEMENT PROXY
SOLICITED BY THE COMMITTEE TO ENHANCE SHARE VALUE
WESTMORELAND COAL COMPANY
DEPOSITORY SHARES
SPECIAL MEETING IN LIEU OF
ANNUAL MEETING OF SHAREHOLDERS
MAY 11, 1999
The undersigned hereby appoints Frank E. Williams, Jr., Nelson
Obus and Bentley Offutt (the "Proxy Committee"), and each of
them,
with the power of substitution, proxies for the undersigned and
authorizes them to represent and vote all of the shares of stock
of the Company which the undersigned may be entitled to vote at
the Special Meeting of Shareholders to be held on May 11, 1999
(the "Meeting"), and at any adjournment thereof, as indicated on
the reverse side of this card with respect to Proposals 1 and 2
and with discretionary authority as to any other matters that
may
properly come before the Meeting, in accordance with and as
described in the Proxy Statement for the Meeting.
PROXIES WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS GIVEN,
THIS
PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2, AND ON ANY OTHER
MATTERS WHICH MAY COME BEFORE THE MEETING AT THE DISCRETION OF
THE
PROXY COMMITTEE.
IMPORTANT: TO BE SIGNED AND DATED ON THE REVERSE SIDE
- -----------------------------------------------------------------
- -
(Reverse of Proxy) Please check appropriate box
Proposal 1. AUTHORITY TO VOTE FOR [ ] WITHHOLD AUTHORITY TO
VOTE FOR [ ]
Westmoreland Committee to Enhance Share Value Nominees as
Preferred Stock (Depository Share) Directors
Guy O. Dove, III William J. Sim
If you wish to withhold authority to vote for one of the above,
you may do so by circling his name.
PROPOSAL 2. AUTHORITY TO VOTE FOR [ ] WITHHOLD AUTHORITY TO
VOTE FOR [ ]
Westmoreland Committee to Enhance Share Value Nominees as
At-large
Directors
Frank E. Williams, Jr. Nelson Obus R. Bentley Offutt
Matthew S.Sakurada Robert A. Fowler
If you wish to withhold authority to vote for one of the above,
you may do so by circling his name.
Signature(s) _______________________________ Date _______________
Signature(s) _______________________________ Date _______________
PLEASE SIGN THIS PROXY EXACTLY AS NAME(S) APPEAR ABOVE.
Preliminary Form of Proxy for Common Stock
(A Blue Card)
- -----------------------------------------------------------------
- -
- -----------------------------------------------------------------
- -
NON-MANAGEMENT PROXY
SOLICITED BY THE COMMITTEE TO ENHANCE SHARE VALUE
WESTMORELAND COAL COMPANY
DEPOSITORY SHARES
SPECIAL MEETING IN LIEU OF
ANNUAL MEETING OF SHAREHOLDERS
MAY 11, 1999
The undersigned hereby appoints Frank E. Williams, Jr., Nelson
Obus and Bentley Offutt (the "Proxy Committee"), and each of
them,
with the power of substitution, proxies for the undersigned and
authorizes them to represent and vote all of the shares of stock
of the Company which the undersigned may be entitled to vote at
the Special Meeting of Shareholders to be held on May 11, 1999
(the "Meeting"), and at any adjournment thereof, as indicated on
the reverse side of this card with respect to Proposal 2 and
with
discretionary authority as to any other matters that may
properly
come before the Meeting, in accordance with and as described in
the Proxy Statement for the Meeting.
PROXIES WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS GIVEN,
THIS
PROXY WILL BE VOTED FOR PROPOSAL 2, AND ON ANY OTHER MATTERS
WHICH
MAY COME BEFORE THE MEETING AT THE DISCRETION OF THE PROXY
COMMITTEE.
IMPORTANT: TO BE SIGNED AND DATED ON THE REVERSE SIDE
- -----------------------------------------------------------------
- -
(Reverse of Proxy) Please check appropriate box
PROPOSAL 2. AUTHORITY TO VOTE FOR [ ] WITHHOLD AUTHORITY TO
VOTE FOR [ ]
Westmoreland Committee to Enhance Share Value Nominees as
At-large
Directors Frank E. Williams, Jr. Nelson Obus
R. Bentley Offutt Matthew S.Sakurada Robert A. Fowler
If you wish to withhold authority to vote for one of the above,
you may do so by circling his name.
Signature(s) _______________________________ Date _______________
Signature(s) _______________________________ Date _______________
PLEASE SIGN THIS PROXY EXACTLY AS NAME(S) APPEAR ABOVE.