Registration No. 333-



               SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C.  20549

                            FORM S-8
                     REGISTRATION STATEMENT
                UNDER THE SECURITIES ACT OF 1933
                --------------------------------

                   Westmoreland Coal Company
                    -------------------------
     (Exact name of registrant as specified in its charter)


            Delaware                              23-1128670
--------------------------------               -----------------
(State or other jurisdiction of                I.R.S. Employer
incorporation or organization)                 Identification No.

               14th Floor, 2 North Cascade Avenue
                Colorado Springs, Colorado 80903
                          719-442-2600
 (Address and Telephone Number of Principal Executive Offices)


                   Westmoreland Coal Company
                              And
                      Affiliated Companies
               Employees' Savings/Retirement Plan
                    (Full title of the plan)


                     Christopher K. Seglem
        President, Chief Executive Officer and Director
               14th Floor, 2 North Cascade Avenue
                Colorado Springs, Colorado 80903
            (Name and address of agent for service)


                          719-442-2600
 (Telephone number, including area code, of agent for service)

                        with a copy to:
  Paul W. Durham, Esquire                Rhonda R. Cohen, Esquire
  Assistant General Counsel              Ballard Spahr Andrews & Ingersoll
  Westmoreland Coal Company              1735 Market Street, 51st Floor  
  14th Floor, 2 North Cascade Avenue     Philadelphia, Pennsylvania
  Colorado Springs, Colorado                           19103-7599
                    80908                (215) 665-8500
  (719) 448-5807

<PAGE>                
                CALCULATION OF REGISTRATION FEE
                --------------------------------

-----------------------------------------------------------------
                           Proposed     Proposed
Title of                   Maximum      Maximum
Securities     Amount      Offering     Aggregate   Amount of
to be          to be       Price Per    Offering    Registration
Registered (1) Registered  Share(2)     Price(2)    Fee
-----------------------------------------------------------------

Common Stock,
par value $2.50
per share(3)

               325,000 shs. $ 1-3/32     $ 355,469  $ 108


Depository Shares,
each representing
a one-quarter share of
Series A Convertible
Exchangeable Preferred
Stock, par value $0.25
per Depository Share

                 7,000 shs. $ 5-5/16     $ 37,188   $ 12

-----------------------------------------------------------------

1)   In addition, pursuant to Rule 416(c) under the Securities
  Act of 1933, this registration statement also covers an
  indeterminate amount of interests to be offered or sold pursuant
  to the employee benefit plan described herein.

2)   Calculated in accordance with Rule 457(c) and (h), on the
  basis of the average of the bid and asked prices of Westmoreland
  Coal Company Common Stock on July 28, 1997, $1-3/32, and on the
  basis of the average of the bid and asked prices of Westmoreland
  Coal Company Depository Shares on July 28, 1997, $5-5/16, as
  reported on the Over-The-Counter Bulletin Board.

3)   Each share of Westmoreland Coal Company Common Stock offered
  hereby will be accompanied by one Preferred Stock Purchase Right.


<PAGE>
                   WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS


                                                            
     This document constitutes part of a Prospectus covering
         securities that have been registered under the
               Securities Act of 1933, as amended.
                                
                                                             
                                
                                
  THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
     UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
      REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
                                                        
                                
           This document is dated as of July 30, 1997.


<Page i>
                    WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS


INTRODUCTION                                                    1

GENERAL PLAN INFORMATION                                        2

HOW THE PLAN WORKS                                              3
          Purpose of Plan                                       3
          The Plan in Brief                                     3
          Who to Contact for More Information                   4

WHO MAY PARTICIPATE IN THE PLAN                                 4

CONTRIBUTIONS TO THE PLAN                                       5
          Employee Contributions                                5
          Employer Contributions                                7
          Valuation and Account Statements                      7
          Types of Accounts                                     7
          Limits on Your Contributions                          7

VESTING                                                         8

INVESTING YOUR ACCOUNT                                          8
          Investment Options                                    8
          Your Investment Responsibilities                      9
          The Plan's Responsibilities                          10
          Investment in Company Stock                          11
          Keeping Track of Your Investments                    12

DISTRIBUTIONS FROM THE PLAN                                    13
          Distributions upon Separation from Service           13
          Distributions Upon Reaching Age 70-1/2               13
          Timing of Distribution                               13
          Form of Distribution                                 14
          Withdrawals of Your Account                          14
          Loans During Employment                              15

TAX TREATMENT OF DISTRIBUTIONS                                 16

<Page ii>
BENEFICIARY DESIGNATION                                        17

AMENDMENT OR TERMINATION OF THE PLAN                           18

PLAN INSURANCE DOES NOT APPLY                                  18

GENERAL PROVISIONS                                             18
          Assignment of Benefits                               18
          Top-heavy Benefits                                   18
          Claim for Benefits                                   18
          Denial of Claim for Benefits                         18

YOUR RIGHTS UNDER ERISA                                        19

AVAILABLE INFORMATION                                          20

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE                21

APPENDIX A - AVAILABLE INVESTMENT OPTIONS                     A-1

APPENDIX B - DESCRIPTION OF COMPANY PREFERRED STOCK,          B-1
     REPRESENTED BY DEPOSITORY SHARES




<Page 1>
                    WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS


                         INTRODUCTION

          This booklet is a summary of your benefits currently
provided under the Westmoreland Coal Company and Affiliated
Companies Employees' Savings/Retirement Plan ("the Plan").
Westmoreland Coal Company (the "Company") and certain
participating affiliated companies adopted the Plan for you and
other employees to help you build financial resources for the
future.  Benefits under the Plan are funded through a trust
established with Mellon Bank and are in addition to those you may
be eligible to receive under the Federal Social Security Program.

          This booklet satisfies two purposes.  First, it
constitutes part of a Prospectus for purposes of the Securities
Act of 1933, as amended (the "Securities Act"), and second, it
serves as a Summary Plan Description under the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
The purpose of the Prospectus is to provide you with information
about the Company, the Company's common stock ("Common Stock"),
and the Company's Series A Convertible Exchangeable Preferred
Stock, four of which are represented by one depository share (the
"Preferred Stock" and "Depositary Shares," respectively).  In
this booklet, Common Stock and Preferred Stock are referred to
together as "Company Stock."  This information is provided so
that you will be able to make an informed decision as to whether
to invest in Company Stock through the Plan.  As of June 30,
1997, 6,965,328 shares of Common Stock, $2.50 Par Value, and
2,300,000 depository shares, each representing one quarter of a
share of the Company's Series A Convertible Exchangeable
Preferred Stock, $0.25 Par Value per depository share, are
outstanding.

          This booklet describes the Plan as it currently
operates.  The Plan is effective September 1, 1987, as amended
through the date of this booklet.  Also, prior versions of the
Plan continue to apply to events that occurred while those
versions were in effect.  For example, participants who
previously retired or terminated employment had their benefits
determined under the Plan that was in effect at the time of their
retirement or termination.  Their benefits are not affected by
later amendments to the Plan or changes in the law.

          Please read this booklet carefully.  The Summary Plan
Description is, as its name suggests, only a summary of the Plan.
The precise rules of the Plan are set forth in the Plan document
and, in case of any inconsistency, the Plan document will govern.
If you wish to see a copy of the actual Plan document, you may do
so by contacting the Plan Administrator.


<Page 2>
                    GENERAL PLAN INFORMATION


1.   Name of Plan: Westmoreland Coal Company and Affiliated
     Companies Employees' Savings/Retirement Plan.

2.   Employer (Plan Sponsor) and IRS Employer Identification
     Number:

          Westmoreland Coal Company
          EIN: 23-1128670
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903

3.   Participating Employers:  The list of participating
     affiliated companies changes from time to time and is
     available upon request from the Plan Administrator.

4.   Plan Number:  001

5.   Type of Plan: Defined Contribution

6.   Type of Administration:  The Plan is trusteed.

7.   Plan Administrator:

          Westmoreland Coal Company Savings/Retirement Plan
           Administrative Committee
          c/o Westmoreland Coal Company
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903
          (719) 448-5822
          Attention:  Cheryl M. Sprague

     The above-named Committee is the Administrator of the Plan
     for purposes of ERISA.  As such, the Committee is
     responsible for preparing certain reports, returns and
     disclosures required by law and is responsible for
     controlling and managing the operation and administration of
     the Plan.  Members of the Committee may be appointed or
     removed at any time by the Company's Board of Directors in
     its sole discretion.  The Committee is also the named
     fiduciary responsible for benefit applications and claims
     review.

8.   Agent for the Service of Legal Process:  None designated.
     Legal process on matters relating to the Plan may be served
     in the name of the Plan on the Plan Administrator or the
     Trustee.

<Page 3>
9.   Plan Trustee:

          Mellon Bank, N.A.
          One Mellon Bank Center
          Defined Contribution Services
          9th Floor
          Pittsburgh, PA  15258-0001

     The Trustee manages and holds the Plan's assets in trust and
     provides recordkeeping services for the Plan.  Pursuant to
     the instructions of the Company, the Trustee invests Plan
     assets, holds cash in deposit accounts, keeps investments in
     nominee or bearer form, pays benefits and expenses of
     administering the Plan, and otherwise acts on behalf of the
     Plan as set forth in a Trust Agreement.

     The Company may contract for additional professional and
     other services to carry out the Plan.  The Plan provides
     that all administration expenses of the Plan and the Trustee
     will be paid by the Company or, at its option,
     proportionally from the funds held pursuant to the Plan.

10.  Investment Manager: The Investment Manager or Advisor for
     each of the investment alternatives is named in the
     description of investment options attached as Appendix A.

11.  Plan Year: September 1 - August 31.  Plan records are
     maintained on this basis.


                       HOW THE PLAN WORKS


PURPOSE OF PLAN

          The purpose of the Plan is to provide for employee
security in retirement and to encourage employees to save on a
regular basis.

THE PLAN IN BRIEF

          The Plan is an individual account defined contribution
plan with a cash or deferred arrangement.  As such, it is
intended to qualify under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the "Internal Revenue Code").  The Plan
is subject to most provisions contained in Titles I, II and III
of ERISA, including provisions governing reporting, disclosure,
participation, vesting and fiduciary responsibility.

          After you are eligible to enroll in the Plan, you may
elect to contribute up to 15% of your pay on a before-tax basis
to the Plan.  The amount of your contribution will be deducted
from each pay check.  The Company will then match a certain
percentage of your salary reduction contributions.  Because your
contributions are made on a pre-tax basis, you defer paying
income taxes on them, on the Company's matching contributions and
also on any earnings on the money in your account until you
actually receive these amounts.

<Page 4>
          All contributions made to the Plan on your behalf are
held in the Plan's Fund and are invested for your benefit.  Your
account under the Plan will reflect the amount that you have
contributed, any amount that has been contributed for you by the
Company, and any investment gains and losses allocable to these
contributions.  Thus, the benefits you ultimately receive from
the Plan will depend on the amount you have contributed and the
investment performance you experience while you have an account
in the Plan.  The Plan will pay you a benefit upon your
retirement, disability or death.

          If you are a "Corona Participant," that is, you were an
employee of the Corona Engineering and Consulting Division of
OESI Power Corporation on September 30, 1995 and became an
employee of the Corona Division of Westmoreland Energy, Inc. on
October 1, 1995, then some special rules, as described later in
this booklet, may apply to you.

WHO TO CONTACT FOR MORE INFORMATION

          The day-to-day operations of the Plan are handled by
the Company's Plan Administrator.  The Plan Administrator is a
committee whose members are appointed from time to time by the
Board of Directors of the Company.  Additional information about
the Plan and the Plan Administrator may be obtained by calling
Cheryl M. Sprague, Director of Human Resources, at
(719) 448-5822.

          Recordkeeping and investment of Plan assets are handled
by Mellon Bank.  Info Line, a telephone computer link arranged
through Mellon Bank, permits you to make choices and receive
information about your account over the telephone.  The Info Line
number is 1-800-407-4015.  Plan participants will have electronic
access to their accounts 24 hours a day.  Dreyfus Retirement
Services Plan Specialists will be available to assist callers
Monday through Friday from 9 A.M. to 8 P.M. (Eastern Time).


                WHO MAY PARTICIPATE IN THE PLAN


          In order to participate in the Plan you must:

          -    have reached age 21

          -    be employed by the Company or a participating
               affiliate of the Company

          -    not be covered by a collective bargaining
               agreement

          -    have worked at least one hour of service since the
               current Plan became effective on September 1, 1987, and

          -    have completed 1,000 hours of service.

<Page 5>
          If you have met all of these eligibility requirements,
you can participate in the Plan on the first day of the month
following the date you complete 1,000 hours of service.  If you
have met these eligibility requirements but you are no longer
employed by the Company or a participating affiliate, or you
become subject to a collective bargaining agreement, you can
become eligible to participate again as soon as you work one hour
of service as an employee of the Company or a participating
affiliate and you are not covered by a collective bargaining
agreement.

          If you are a Corona Participant, your hours of service
with Corona when it was a division of OESI Power Corporation will
be counted towards your hours of service requirement for
participation under the Plan.


                   CONTRIBUTIONS TO THE PLAN


EMPLOYEE CONTRIBUTIONS

          SALARY REDUCTION CONTRIBUTIONS

          You do not automatically participate in the Plan just
because you are eligible.  Instead, you must enroll in the Plan
and choose to reduce a certain percentage of your pay through
payroll deduction.  These contributions to the Plan are called
Salary Reduction Contributions.  If you elect to make Salary
Reduction Contributions, your base pay, up to certain limits
established and adjusted for cost of living by Federal tax law,
will be reduced by the amount you choose.  Then, this amount will
be contributed to your Salary Reduction Contribution account.

          Your Salary Reduction Contributions are taken from your
pay before Federal income taxes are deducted.  Since these taxes
are based on a lower income (your pay minus your before-tax
contributions), your taxes are lower.  Your Salary Reduction
Contributions, however, are subject to Federal Social Security
(FICA) tax and Federal unemployment (FUTA) tax.

          After February 28, 1995, you can elect to have up to 15
percent of your pay withheld from your paycheck and contributed
to the Plan.  (Before this time, you could only contribute up to
10 percent of your pay.)  The amount of your contributions will
ultimately change as your base pay changes.  In order to
determine the amount of your Salary Reduction Contributions and
Matching Contributions, your "pay" is the amount of your base pay
from the Company or a participating affiliate excluding overtime
pay, bonuses, commissions, and any other form of incentive or
special pay and expense reimbursements.  Your pay for these
purposes does include your Salary Reduction Contributions to the
Plan and contributions under any cafeteria plan.  Under Federal
tax law, the maximum amount of your pay that may be included in
determining Salary Reduction Contributions is $160,000 for 1997.
(This number will be adjusted periodically for inflation.)

<Page 6>
          The maximum amount of Salary Reduction Contributions
you can make in any calendar year is limited by the Internal
Revenue Service ("the IRS").  In 1997, the IRS limit is $9,500.
(See "Limits on Your Contributions-Salary Reduction
Contributions" below for more information on the limits
applicable to Salary Reduction Contributions.)

          After February 28, 1995, you may change the percentage
rate you defer on any day, up to once a month.  (Before then, you
could only make changes once a quarter.)  You may also
discontinue your Salary Reduction Contributions at any time, but,
if you want to start deferring again, you must wait until the
first day of the payroll period following the first day of the
next calendar month.  If you wish to change or stop your Salary
Reduction Contributions, either complete an Enrollment and Change
Form from your enrollment kit or call the Info Line at
1-800-407-1015.  Salary Reduction Contribution elections become
effective as soon as administratively possible, but not before
the first payroll period following the payroll period during
which the election is made.

          VOLUNTARY CONTRIBUTIONS

          These are after-tax contributions you may have made
prior to June 1, 1984 under the Plan that was then in effect.
You are no longer permitted to make these after-tax contributions
to the Plan.  The after-tax contributions you made before
June 1, 1984 will continue to be held under the Plan.

          ROLLOVER CONTRIBUTIONS

          If you had an account under a former employer's
qualified retirement plan or if you transferred a distribution
from such a plan to an individual retirement account (IRA), you
may be able to transfer or "roll over" these funds into this
Plan, if you comply with certain rules established for rollovers.
Amounts rolled over to this Plan will be placed in a separate
account in your name, known as your Rollover account.

          The tax laws that apply to rollovers are complex.  If
you have money in a former employer's plan or in a rollover IRA
and you wish to arrange for a rollover of these amounts into the
Plan, please see your Plan Administrator.

<Page 7>
EMPLOYER CONTRIBUTIONS

          MATCHING CONTRIBUTIONS

          If you make Salary Reduction Contributions in a
particular Plan Year, the Company will match 50% for each dollar
you contribute, up to the first 5% you contribute from your pay.
For example, if your monthly paycheck is $2,000 and you
contribute 5% of your pay before taxes ($100), the Company would
add $50 to your account for that month.  This Matching
Contribution will be added to your account on the date of your
paycheck.  Note that under Federal tax law, the maximum amount of
your pay that may be included in determining Matching
Contributions is $160,000 for 1997.  (This number will be
adjusted periodically for inflation.)

          If you are a Corona Participant, effective
October 1, 1995, the Company will match one dollar for each
dollar you contribute from your pay as a Salary Reduction
Contribution, up to the first 7% you contribute from your pay.

VALUATION AND ACCOUNT STATEMENTS

          Generally, the value of your account will be determined
each business day according to the fair market value of the
investment option you have chosen.  You will receive quarterly
statements from Mellon Bank showing your account balance and
transactions during that quarter.  You may obtain your account
balance at any time by calling the Info Line.

TYPES OF ACCOUNTS

          You will have your own account within the Plan's Fund.
Within your account are several sub-accounts, one for each type
of investment election you make and one for each type of
contribution made to your account, such as Salary Reduction
Contributions, Matching Contributions and Rollover funds.  Each
sub-account also contains the appropriate adjustments for
withdrawals, distributions, earnings, losses and expenses.

LIMITS ON YOUR CONTRIBUTIONS

          Federal tax law imposes certain limitations on the
amount of contributions that may be made to the Plan:

          SALARY REDUCTION CONTRIBUTIONS

          The maximum amount of Salary Reduction Contributions
you may make to the Plan in any calendar year is limited by the
IRS.  In 1997, the limit is $9,500.  The IRS may adjust this
limit in the future.  To comply with this limit, the Company may
either prospectively restrict your election or return to you any
extra amounts contributed, together with any earnings on those
amounts, on or before the April 15th following the end of the
calendar year.

<Page 8>
          If you are considered a highly paid employee (as
defined by IRS regulations), other limitations may apply to you
as well.  Federal law requires that the Plan be tested annually
to ensure that the percentage of compensation contributed by
highly paid employees, on average, does not exceed the percentage
of compensation contributed by other employees by more than a
permitted amount.  If the test cannot be passed, or if this
limitation is or may be exceeded, highly paid employees may have
their contributions reduced or suspended during the year (or, in
some cases, prior employee contributions may have to be returned
to highly paid employees).  If you are affected by this
restriction, you will be notified.

          MATCHING CONTRIBUTIONS

          A similar test may limit the Company's matching
contributions for highly paid employees.  If the limit is
exceeded by any highly paid employee, the excess matching
contributions together with earnings will be distributed to the
highly paid employee after the end of the year.  If you are
affected by this restriction, you will be notified.

          TOTAL ANNUAL CONTRIBUTION

          In addition, there is a limit on the total amount
(i.e., Salary Reduction Contributions and Matching Contributions)
you can add to your account in any Plan Year.  Generally
speaking, this limit is $30,000 or 25% of your pay for the year,
whichever is less.  Again, the maximum amount of pay that can be
taken into account for this purpose in 1997 is $160,000 (as
indexed for inflation).  If you are affected by these
restrictions, you will be notified. Your contributions may be
limited to prevent this total annual contribution limit from
being exceeded.


                            VESTING


          At all times you will be 100% vested in your entire
account under the Plan.  This means that you have earned a
nonforfeitable right to receive 100% of your account from the
Plan in the future, regardless of when you stop working for the
Company.


                     INVESTING YOUR ACCOUNT


INVESTMENT OPTIONS

          Under the Plan, you decide how your account will be
invested, except for certain amounts that have already been
automatically invested in Company Stock before 1994 (see
"Investment in Company Stock" below).  The investment options
currently available are described in Appendix A to this booklet.

<Page 9>
          There are transaction fees or expenses charged to you
or your account when you purchase or sell the investments offered
under the Plan.  These fees are described in Appendix A to this
booklet  For information about the administrative and management
fees incurred by the investment funds, see the Prospectus or
Product Description for the respective fund.

YOUR INVESTMENT RESPONSIBILITIES

          Each investment option has different investment
objectives, different expected rates of return, and different
risks.  See Appendix A for a description of the investment
options currently available under the Plan.  More information
about the investment options may be found in the fund
Prospectuses or Product Descriptions and other related materials
contained in your enrollment kit and available from the Plan
Administrator or in the Prospectuses or Product Descriptions
available from Dreyfus Retirement Services.  To receive
additional information relating to an investment in Company
Stock, you should read the section in this booklet called
"Investment in Company Stock" and you may also contact
Westmoreland Coal Company directly at the address and phone
number provided in Item 7 of the General Information section of
this booklet.  You should be sure to read all of the information
describing the funds before making any investment decisions.  NO
INVESTMENT CAN GUARANTEE A CERTAIN RATE OF RETURN.  NO INVESTMENT
CAN BE GUARANTEED AGAINST LOSS.

          When you make an investment choice, your investment
election will remain in place until you change it.  Your election
applies to your contributions as well as any earnings on them.
On and after March 1, 1995, you generally may transfer funds
among the investment options (or change how new contributions
will be invested) on any day of any calendar month, as long as
you make only one election in any month, subject to the
restrictions on the Company Stock discussed in the section in
this booklet called "Resale of Company Stock Acquired from the
Plan."  (Note that before March 1, 1995, investment selection
could only be made once each Plan quarter.)  You may call the
Info Line to make investment selections and changes.  Most
investment selections become effective on the same or next day
that you request the change.  You may inquire about the effective
date of your particular selections when you call the Info Line.

THE PLAN'S RESPONSIBILITIES

          The Plan is intended to comply with the requirements of
section 404(c) of ERISA.  This means that the Plan permits
participants to direct the investment of their accounts.  As long
as the Plan complies with the requirements of section 404(c), you
have the responsibility to decide how your accounts are invested
and the parties that otherwise would be responsible for making
investment decisions (the "fiduciaries" of the Plan) will not be
liable for any losses that result directly from investment
instructions that you make.  Mellon Bank will not take any action
regarding the investment of your account without specific
instructions from you.

<Page 10>
          To comply with section 404(c), the Plan must permit
participants to choose from a broad range of investment
alternatives and must provide participants with certain
information about the investment alternatives and the operation
of the Plan.  In addition to the information included in this
booklet and the accompanying Appendix that describes the
investment options available under the Plan, you may request the
following information:

          -    A description of the annual operating expenses of
               each investment fund, and the aggregate amount of such
               expenses expressed as a percentage of average net
               assets of the investment fund.

          -    Copies of any prospectuses, financial statements
               and reports and any other materials relating to the
               investment funds to the extent such information is
               provided to the Plan.

          -    A list of assets comprising the portfolio of each
               investment fund that constitute Plan assets within the
               meaning of ERISA and the value of each such asset.

          -    Information concerning the value of shares or
               units in each investment fund, as well as the past and
               current investment performance of such investment fund,
               determined, net of expenses, on a reasonable and
               consistent basis.

          -    Information concerning the value of shares or
               units in investment funds held in your account.

          You will be able to receive most of this information
from Dreyfus Retirement Services by calling the Info Line or by
writing to Dreyfus Retirement Services at 144 Glenn Curtiss
Boulevard, Uniondale, NY  11556-0144.

          The Administrative Committee of the Westmoreland Coal
Company is the named fiduciary responsible for providing the
information described above for all investment alternatives
available under the Plan, so if you do not receive information
you need from Dreyfus Retirement Services, you should contact the
Company at the address or phone number provided in Item 7 of the
General Information section of this booklet.

<Page 11>
INVESTMENT IN COMPANY STOCK

          AUTOMATIC INVESTMENT IN COMPANY STOCK

          All Salary Reduction Contributions and Rollover
Contributions made before March 1, 1990, Matching Contributions
made before December 1, 1993 and Voluntary Contributions made
before June 1, 1984 were automatically invested in Company Stock.
These contributions may not be transferred into other investment
options until you reach age 55, unless between June 1, 1990 and
September 1, 1994 you elected, no more than once a Plan Year, to
transfer up to 20% of the value of these pre-1990 Salary
Reduction Contributions, pre-1990 Rollover Contributions and
Voluntary Contributions to other investment options.  After you
reach age 55, you may transfer a portion of your remaining
pre-1990 Salary Reduction Contributions, pre-1990 Rollover
Contributions, Voluntary Contributions and pre-1994 Matching
Contributions to other investment options once a Plan Year.  Here
is a schedule that shows what percentage of these shares you can
transfer per Plan Year depending on your age:


                                    ...then you may transfer
                                    up to this percentage of
       If you are this age...       the shares described above
        ---------------------       --------------------------

             55                                40%
             56                                60%
             57                                80%
             58 or older                      100%

Additionally, you may choose to have the entire amount of
Matching Contributions made to your account before
December 1, 1993 and invested in Company Stock invested in either
Common Stock or Preferred Stock, but you are prohibited from
later changing this election until you reach age 55.

          OPTIONAL INVESTMENT IN COMPANY STOCK

          The rest of your account, that is, Salary Reduction
Contributions and Rollover Contributions made on and after
March 1, 1990 and Matching Contributions made on and after
December 1, 1993, can be invested in any investment option you
select, including Company Stock, and you may change your
investment mix up to once a month on any day of the month.

          Descriptions of Common Stock and Preferred Stock are
included in Appendix A of this booklet.  Preferred Stock is
described further in Appendix B.

          PURCHASE OF COMPANY STOCK

          If you invest in Company Stock, the Trustee will
purchase the Company Stock on the over-the-counter market at
prevailing market prices as soon as practicable.

<Page 12>
          Procedures have been established by the Company to
ensure that your decisions to purchase, hold and sell Company
Stock remain confidential.  Your investment instructions are sent
to the Plan's recordkeeper who communicates these instructions to
the Trustee.  Your decision to invest in Company Stock is
communicated only to the people who must know the information to
properly administer the Plan.  The person responsible for
monitoring these confidentiality procedures and other procedures
which ensure that your voting decisions with respect to the
shares of the Company Stock held in your account remain
confidential is:

          Westmoreland Coal Company Savings/Retirement Plan
           Administrative Committee
          c/o Westmoreland Coal Company
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903
          (719) 448-5822
          Attention:  Cheryl M. Sprague

          VOTING OF COMPANY STOCK

          If you invest in Company Stock, the stock certificates
will be issued in the Trustee's name and held by the Trustee, but
you will have the power to direct the Trustee how to vote your
shares.  You will be notified from time to time that a vote is
scheduled and how you can instruct the Trustee how to vote your
shares.  The Company will not know how you voted and your voting
decision will be kept confidential.  If you do not direct the
Trustee, the Trustee will vote your stock at its discretion.  In
addition, you will be able to give confidential instructions to
the Trustee in the case of tender offers affecting the shares of
Company Stock held in your account.

          RESALE OF COMPANY STOCK ACQUIRED FROM THE PLAN

          The Plan imposes no limitation or restriction on
resales of Company Stock acquired in a distribution from the
Plan.  In addition, shares of Company Stock that have been
registered under the Securities Act may generally be resold by
participants who have received them in a distribution of Company
Stock from the Plan.  However, participants who may be deemed to
be "affiliates" of Westmoreland Coal Company may resell shares of
Company Stock received in a distribution only pursuant to an
effective registration statement specifically relating to such
resales, pursuant to Rule 144 under the Securities Act or in a
transaction otherwise exempt from registration under the
Securities Act.

KEEPING TRACK OF YOUR INVESTMENTS

          You may obtain more information about your investments
under the Plan by calling the Info Line at any time.

<Page 13>
                  DISTRIBUTIONS FROM THE PLAN


          With the exception of certain withdrawals and loans
(described on pages 14-16), benefits under the Plan are
ordinarily paid ONLY upon retirement, disability, other permanent
separation from service or death.  Funds are not otherwise
available to you.

DISTRIBUTIONS UPON SEPARATION FROM SERVICE

          RETIREMENT

          If you retire at or after reaching age 65, you are
entitled to receive your entire account balance.

          DEATH

          If you die before the entire interest in your account
is paid out to you, the remaining interest will be paid to your
beneficiary as soon as practicable following your death.

          TOTAL DISABILITY

          If you become totally disabled, your account will be
paid out to you.  As of September 1, 1995, you are considered
totally disabled if you are receiving benefits under a long term
disability program sponsored by the Company or a participating
affiliate and if your disability is expected to be indefinite,
rendering you unable to return to work.  If you became totally
disabled before September 1, 1995 you had to remain totally
disabled for six consecutive months before your account could be
distributed to you.  If you became totally disabled on or after
September 1, 1995 there is no longer a six month waiting period.

          OTHER SEPARATION FROM SERVICE

          If you leave for any other reason, you are entitled to
receive the entire interest in your account.

DISTRIBUTIONS UPON REACHING AGE 70-1/2

          If you reach age 70-1/2 and your benefits have not yet
begun to be paid, you will start receiving a benefit on the
April 1 after the calendar year in which you reach age 70-1/2,
even if you have not retired or otherwise separated from service
at this time.

TIMING OF DISTRIBUTION

          If you have $3,500 or less in your account or you have
reached age 65, you will automatically receive your benefits on
the soonest practicable date after your account has been valued
after your separation from service.

<Page 14>
          If you have ever had more than $3,500 in your account
or you have not reached age 65, you will receive your benefits on
the soonest practicable date after your account has been valued
after your separation from service or, at a later date you
choose, but not later than the time you reach age 65.

FORM OF DISTRIBUTION

          If your interest in your account does not exceed
$3,500, your interest will be paid to you or your beneficiaries
in a single lump sum.

          In all other cases, you or your beneficiaries may
choose to receive your interest in a single lump sum or in the
form of an annuity providing for payments for a term of 5, 10 or
15 years, but no longer than your life expectancy at the time
your benefits begin.  If you do not choose a form of benefit,
your benefit will be paid in a single lump sum.

          If your account contains Company Stock, you may elect
to receive your distribution in cash or in stock, unless you have
fewer than ten shares, in which case the distribution will be
made in cash.

          You will be provided with the appropriate forms to make
these elections prior to the time of distribution.

WITHDRAWALS OF YOUR ACCOUNT

          VOLUNTARY CONTRIBUTION AND ROLLOVER ACCOUNTS

          You may withdraw, once a Plan Year, any amount from
your Voluntary Contribution account or your Rollover account.

          SALARY REDUCTION CONTRIBUTION ACCOUNT - WITHDRAWAL FOR
          FINANCIAL NECESSITY

          You may withdraw, up to once a Plan Year, any amount
from your Salary Reduction Contribution account if you show the
Plan Administrator that you have an immediate and heavy financial
need and demonstrate that this money is needed to satisfy that
need.  A need will be considered immediate and heavy if it arises
from:

          -    expenses for medical care for you, your spouse or
               your dependents,

          -    the purchase by you of a new principal residence
               (not mortgage payments),

          -    payment of tuition and related educational fees
               for the next year of post-secondary education for you,
               your spouse, children or dependents, or

          -    payments needed to prevent your eviction or
               foreclosure from your principal residence.

<Page 15>
          You cannot withdraw more than you need to meet your
hardship (including whatever is needed to satisfy the tax on the
withdrawal) and you must have obtained money from all other
permissible distributions and non-taxable loans, if any, under
this or other plans maintained by your employer.

          If you make a hardship withdrawal, you may not make any
Salary Reduction Contributions to your account for the next 12
months.  Further, in the following calendar year when you are
able to make Salary Reduction Contributions again, you will be
limited in how much you may contribute.

          AGE 59-1/2 WITHDRAWALS

          When you reach age 59-1/2, you may withdraw up to the
total amount in your account, less any amounts already withdrawn.

          TAXES ON WITHDRAWALS

          All distributions, including withdrawals (except
withdrawals of after-tax contributions) are subject to Federal
income tax in the year you receive the payment.  (See "Tax
Treatment of Distributions," below, for more information.)

LOANS DURING EMPLOYMENT

          You may borrow from your account only if you are an
active employee participating in the Plan.  You may apply for a
loan from the Plan once a calendar year, but you can never have
more than one outstanding loan at a time.  To apply for a loan,
contact the Plan Administrator for loan application forms.
Beginning March 1, 1990, the minimum loan amount is $1,000.
(Before March 1, 1990, the minimum loan amount was $500.)  You
may borrow up to 50% of the total value of your account as long
as that amount is no more than $50,000, but you cannot borrow
more than you have personally contributed to your account.  In
addition, you are limited in the total amount you can borrow from
this and other plans sponsored by the Company and affiliated
companies.

          If you take out a loan, you must pay interest on the
loan.  Beginning February 28, 1995, the interest rate is the
prime rate plus 1%, fixed as of the date of your loan
application.  This rate will remain the same for the entire
period of the loan.  (Before February 28, 1995, the rate was
equal to the fixed rate the Trustee charged for unsecured loans.)

          Generally, you have five years to repay your loan,
unless you use it to acquire your principal residence, in which
case your repayment term may be as long as 15 years.  You repay
the loan in installments through automatic payroll deductions.
You will authorize these deductions when you request your loan.
Each payment you make of principal and interest will be credited
to your account.  You may pay off the outstanding balance of your
loan at any time in a lump sum with no penalty by notifying
Mellon Bank.  If you do this, however, you may not apply for
another loan for the next 12 months.

<Page 16>
          Certain events, such as death, separation from service,
certain reductions in salary, failures to pay, or attempts to revoke a
payroll deduction authorization for repayment will accelerate the
loan so that the principal and interest become payable in full
immediately.  If you fail to pay in the time specified, the
outstanding balance of the loan plus accrued interest will be
deducted from your account and you will be subject to Federal
income tax on it.


                 TAX TREATMENT OF DISTRIBUTIONS


          The Plan is intended to qualify for certain favorable
tax treatment (that is, it is intended to be a "qualified" plan
under Section 401(a) of the Internal Revenue Code).  Taxes
generally are not due on any contributions when they are made.

          Your benefits from the Plan, including withdrawals
during employment, generally are subject to tax when distributed.
The distribution is generally subject to Federal income tax at
ordinary income tax rates; however, any after-tax contributions
are exempt from tax when distributed.  You should be aware of the
following additional rules:

          -    ROLLOVER TO OTHER PLANS.  You have the right to
               instruct the Plan Administrator to transfer all or a
               portion of a lump sum payment from the Plan (but not
               less than $500) directly to either an IRA (individual
               retirement account or individual retirement annuity) or
               to another employer's plan that accepts rollovers.  (If
               you receive a benefit payment because you are age
               70-1/2 or older, part of the payment may not be
               eligible for rollover, in which case the Plan
               Administrator will let you know.)  If you choose a
               direct rollover, no Federal income tax will be withheld
               on the amount you roll over and you will not pay tax in
               the current year on the amount you roll over.

               If, instead, you choose to receive the payment,
               the Plan Administrator is required by law to withhold
               20% of the payment as Federal income tax withholding to
               be credited toward the amount of tax you owe for the
               year. The payment will be taxed in the current year,
               unless you roll over the payment to an IRA or another
               employer's qualified plan that accepts rollovers within
               60 days of receiving the payment.  The amount rolled
               over will not be taxed until you take it out of the IRA
               or the other employer's plan.  If you want to roll over
               the full amount of the payment, you must find other
               money to replace the 20% that was withheld; otherwise
               you will have to pay tax in the current year on the
               amount that was withheld.

               Prior to distributing funds to you from the Plan,
               the Plan Administrator will provide you with a notice
               generally explaining your rollover options, as well as
               the withholding requirements and possible tax
               consequences of your election.

          -    10% PENALTY TAX MAY APPLY.  If you receive a
               taxable distribution or withdrawal from the Plan before
               you reach age 59-1/2, you will be required to pay an
               additional 10% Federal tax unless you meet one of the
               limited exceptions to this rule.  You should consult a
               tax advisor about the tax consequences of any
               particular withdrawal or distribution to determine if
               the 10% penalty tax will apply.

               The laws that govern the tax treatment of
               contributions to and benefit payments from retirement
               plans are quite complex.  YOU SHOULD CONSULT WITH YOUR
               PERSONAL TAX ADVISOR ABOUT YOUR OWN PARTICULAR
               SITUATION AND HOW THESE RULES APPLY TO A SPECIFIC
               PAYOUT TO YOU.


                    BENEFICIARY DESIGNATION


          You may choose a beneficiary or beneficiaries to
receive your interest in your account after your death.  However,
if you are married, you must designate your spouse as your
beneficiary, unless your spouse properly consents to a different
beneficiary on the form provided for this purpose.  You may
change your beneficiary designation at any time so long as you
properly notify the Plan Administrator.


              AMENDMENT OR TERMINATION OF THE PLAN


          Although the Company intends for this Plan to be
permanent, each participating company has the right to terminate
its participation in the Plan at any time.  In addition, the
Company may terminate or amend the Plan at any time by action of
the Company's Board of Directors or its delegate.

          If the Plan is completely discontinued, the total
amounts then in your accounts will be fully vested and held for
distribution to you in accordance with the benefit provisions of
the Plan or in such other manner as the Company may determine.


                 PLAN INSURANCE DOES NOT APPLY


          The Plan is not covered by the Federal insurance
program of the Pension Benefit Guaranty Corporation (PBGC).  The
PBGC only guarantees pensions for defined benefit plans which
fund for a specific monthly benefit upon retirement.  Because the
Plan is a defined contribution plan with benefits based on an
account and not a specific monthly benefit, the Plan is not
insurable.

<Page 18>
                       GENERAL PROVISIONS


ASSIGNMENT OF BENEFITS

          Your account balance belongs to you and may not be
sold, assigned, transferred or pledged to another person under
most circumstances.  However, if you become a party to a divorce
property settlement or a court order, or if you become liable for
support or alimony payments, the Plan may be legally required to
pay all or a portion of your benefit to your spouse, ex-spouse,
children or other dependents in compliance with a qualified
domestic relations order.

TOP-HEAVY BENEFITS

          Federal law provides that in the event that the Plan is
shown to benefit certain "key employees" disproportionately, the
Plan may be declared "top-heavy" and become subject to special
rules.  If the Plan is declared "top-heavy," you will receive
information concerning the new rules that would apply to the
Plan.  It is extremely unlikely that the Plan will become
top-heavy.

CLAIM FOR BENEFITS

          After an event that entitles you to benefits has
occurred, you may apply for your Plan benefits by filing a
request with the Plan Administrator.

DENIAL OF CLAIM FOR BENEFITS

          If the Plan Administrator denies, in whole or in part,
your claim for benefits, the Plan Administrator will notify you
within 90 days of the specific reasons for the denial and how you
may perfect your claim or how you can appeal the denial.  In
special circumstances the Plan Administrator may extend the
response period for up to an additional 90 days, in which event
it will notify you in writing of the extension, and the reasons
for it.

          You or your representative have 60 days from receipt of
a notice of claim denial to petition the Plan Administrator in
writing for a full and fair review of the denial.  You or your
representative will be able to review pertinent documents and to
submit issues and comments in writing to the Plan Administrator.
The Plan Administrator will review the denial and will tell you
its decision and reasons for it in writing within 60 days of
receipt of the petition; provided, however, that in special
circumstances the Plan Administrator may extend the response
period for up to an additional 60 days, in which event it will
notify you in writing of the extension.  This is the only way to
contest a decision denying benefits under the Plan.


<Page 19>
                    YOUR RIGHTS UNDER ERISA


          As a participant in the Plan, you are entitled to
certain rights and protections under ERISA.  ERISA provides that
all Plan participants shall be entitled to:

          -    Examine, without charge, all Plan documents,
               including insurance contracts and copies of all
               documents filed by the Plan with U.S. Department of
               Labor, such as detailed annual reports and Plan
               descriptions.  The documents may be examined at the
               Plan Administrator's office.

          -    Obtain copies of all Plan documents and other Plan
               information upon written request to the Plan
               Administrator, who may make a reasonable charge for the
               copies.

          -    Receive a summary of the Plan's annual financial
               report.  The Plan Administrator is required by law to
               furnish each participant with a copy of this summary
               annual report.

          -    Obtain a statement of your account balance.  You
               must request such a statement in writing, and not more
               than once a year.  This service is free of charge.

          In addition to creating rights for Plan participants,
ERISA imposes duties upon the people, called "fiduciaries," who
are responsible for the operation of the employee benefit plan.
They have a duty to operate the Plan prudently and in the
interest of Plan participants and beneficiaries.  The Company may
not fire you or otherwise discriminate against you in any way to
prevent you from obtaining a benefit or exercising your rights
under ERISA.  If your claim for a benefit is denied in whole or
in part, you must receive a written explanation of the reason for
the denial.  You have the right to have your claim reviewed and
reconsidered.

          Under ERISA, there are steps you can take to enforce
the above rights.  For instance, you may file suit in a Federal
court if you request materials from the Plan and do not receive
them within 30 days.  The court may require the Plan
Administrator to provide the materials and pay you up to $100 a
day until you receive them (unless the materials were not sent
because of reasons beyond the Plan Administrator's control).  If
your claim for benefits is denied in whole or in part, or
ignored, you may file suit in a state or Federal court.  If you
believe Plan fiduciaries have misused the Plan's money, or have
discriminated against you for asserting your rights, you may seek
assistance from the U.S. Department of Labor, or file suit in a
Federal court. If you are successful, the court may order the
person you have sued to pay court costs and legal fees.  If you
lose, the court may order you to pay (for example, if it finds
your claim to be frivolous).

<Page 20>
          If you have any questions about the Plan, you should
contact the Plan Administrator.  If you have any questions about
this statement or about your rights under ERISA, you should
contact the nearest Area Office of the U.S. Labor Management
Services Administration, Department of Labor.


                     AVAILABLE INFORMATION


          The Company is subject to the informational
requirements of the Securities Exchange Act of 1934 (the
"Exchange Act") and, in accordance therewith, files reports,
proxy statements and other information with the Securities and
Exchange Commission (the "Commission").  Such reports, proxy
statements and other information filed by the Company with the
Commission can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street N.W.,
Washington, D.C. 20549, and at its Regional Offices:  7 World
Trade Center, New York, New York 10048; and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661.  Copies can also be
obtained upon payment of prescribed rates from the Public
Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 or from the Commission's World Wide Web
site at http:\\www.sec.gov.

          The Company has filed with the Commission a
Registration Statement on Form S-8 (together with all amendments
and exhibits thereto, the "Registration Statement") under the
Securities Act covering the registration of the securities that
may be offered under the Plan.  The foregoing description does
not contain all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission.

          The Company will furnish, without charge, to each
eligible participant in the Plan a copy of its most recent 10-K
and, if available, annual report to shareholders and will also
deliver to each person holding an interest in the Plan, who does
not otherwise receive such materials as a shareholder of the
Company, copies of all reports, proxy statements and other
communications distributed to the shareholders of the Company
generally.  The Company also will provide, without charge, to
each person to whom a copy of this booklet is delivered, on the
written or oral request of any such person, a copy of any or all
of the documents which have been or may be incorporated by
reference in Item 3 of Part II of the Registration Statement,
which items are incorporated by reference into this booklet,
other than exhibits to such documents.  Requests for such copies
should be directed to Westmoreland Coal Company, Corporate
Secretary, 14th Floor, 2 North Cascade Avenue, Colorado Springs,
Colorado 80903, (719) 442-2600.

          Except where otherwise indicted herein, this booklet
speaks as of its date, and neither the delivery of this booklet
nor any sales hereunder shall under any circumstances create any
implication that there has been no change in the affairs of the
Company since that date or that the information contained herein
is correct as of any time subsequent to that date.  No person has
been authorized to give any information or to make any
representations, other than as contained in this booklet and in
other documents relating to the Plan delivered to eligible
employees in connection with the offer described in this booklet
and if given or made such information or representations must not
be relied upon.  This booklet does not constitute an offer of any
securities other than those to which it relates, or an offer of
those to which it relates in any state to any person to whom it
is unlawful to make such offer in such state.

<Page 21>
        INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE


          The following documents filed by the Company with the
Commission pursuant to the Exchange Act are incorporated herein
by reference:

ITEM 3.   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.

          The following documents filed with the Securities and
Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") by Westmoreland Coal
Company (the "Company") (File No. 0-752) are incorporated herein
by reference:

                    (i)  the Company's Annual Report on Form 10-K
                         for the fiscal year ended December 31, 1996;
   
                   (ii)  the description of the Company's Common
                         Stock contained in its Registration Statement on
                         Form 8-A, filed May 22, 1992 and

                  (iii)  the description of the Company's
                         Depository Shares contained in its Registration
                         Statement on Form 8-A, filed June 23, 1992.


          Each document filed by the Company after the date
hereof pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold
or which deregisters all securities remaining unsold, shall be
deemed to be incorporated by reference in this Registration
Statement and shall be part hereof from the date of filing of
such document.

<Page A-1>
                          APPENDIX A TO
            SUMMARY PLAN DESCRIPTION AND PROSPECTUS
                     DATED JULY     , 1997

                  AVAILABLE INVESTMENT OPTIONS

     This Appendix provides additional information regarding each
of the investment options available under the Plan.  These
investment options consist of Company Stock and the following
investment funds available through Dreyfus Retirement Services:

          *      Dreyfus New Leaders Fund, Inc.
          *      Dreyfus International Growth Fund
          *      Dreyfus Cash Management
          *      Dreyfus Short-Intermediate Government Fund
          *      Dreyfus S&P 500 Index Fund
          *      Dreyfus Disciplined Stock Fund
          *      Capital Preservation Fund

     The following are investment profiles for each of the
Dreyfus Retirement Services investment funds, followed by
information regarding the Company Stock.  Such profiles are based
on information provided by Dreyfus Retirement Services.
Additional information, including financial data, investment
policies, management, distribution, and service fees and expenses
with respect to each of these funds is contained in the
Prospectus or Product Description for the fund, a copy of which
can be obtained through Dreyfus Retirement Services.  As with any
mutual fund, there is no assurance that the fund will achieve its
stated objective.

<Page A-2>
                             DREYFUS
                       Retirement Services

                 DREYFUS NEW LEADERS FUND, INC.

FUND DESCRIPTION
The Fund's goal is to maximize capital appreciation.

INVESTMENT STRATEGY
The  Fund  seeks  out companies that Dreyfus  believes  have  the
potential for significant growth. The Fund is particularly  alert
to  companies  which  it considers to be new  leaders,  that  is,
emerging   smaller-sized   companies   (typically   with   market
capitalizations  of  less  than  $750,000),  both  domestic   and
foreign, which the Fund's management believes to be characterized
by new or innovative products, services or processes which should
enhance  prospects for growth in future earnings. The  Fund  will
also   invest   in   special   situations   such   as   corporate
restructurings.  During normal market conditions  the  Fund  will
invest  aggressively in domestic and foreign common  stocks.  For
defensive   purposes  the  Fund  can  invest  in   money   market
instruments. The Fund may also invest up to 25% of its assets  in
foreign securities.

INVESTOR PROFILE
Dreyfus New Leaders Fund may be appropriate for investors seeking
long-term capital growth who are looking to supplement an overall
investment program with a more aggressive equity investment.

INVESTMENT RISKS
The  Fund invests principally in common stocks. Stock prices move
up  and down in response to the performance of their issuers  and
general economic and market factors. The prices of stocks move in
different degrees, based on varying impact of these factors  over
time,   which  affects  the  relative  volatility  of   a   fund.
Investments  in smaller-sized companies tend to be more  volatile
than  investments in larger-sized companies, which can cause  the
fund's  share price also to be more volatile. The Fund  can  also
invest  in  foreign  securities, which involve  additional  risks
including   political   and  economic   climates   and   currency
fluctuations,   and   use  sophisticated  investment   techniques
including  investments in derivative instruments. When  you  sell
your shares of the Fund, they may be worth more or less than what
you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

Management fees      .75%
Other Expenses       .46%

Total Portfolio Operating Expenses 1.21%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment  assuming ( 1 ) a 5% annual return and (2)  redemption
at the end of each period.

    One year       $  12
    Three years    $  38
    Five years     $  66
    Ten years      $ 147

<Page A-3>
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and returns may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to    shareholders.   Please   consult   your   Human   Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends and capital gains are generally declared and paid
annually. All distributions to retirement accounts will be
automatically reinvested in addition' al Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR PLAN.
IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING ALL OR A
PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS INVESTMENT OPTION,
PLEASE CONTACT YOUR HUMAN RESOURCES REPRESENTATIVE.

Premier Mutual Fund Services, Distributor
@) 1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation

<Page A-4>
DREYFUS NEW LEADERS FUND, INC.
MANAGED BY THE DREYFUS CORPORATION

                                 SMALLER CAPITALIZATION COMPANIES

BENCHMARK    Russell 2000 Index with dividends reinvested.*

STRATEGY     The  Fund invests primarily in common  stocks
             of  domestic  and  foreign  issuers  typically  with
             market  capitalizations below $1.5 billion  at  time
             of   purchase.    There   are  approximately   5,000
             companies  available  for  consideration   in   this
             market  capitalization range.  The Fund  may  invest
             up  to  25%  of  the  value of  its  assets  in  the
             securities  of  foreign  companies  which  are   not
             publicly  traded in the United States and  the  debt
             securities  of foreign governments.  Investments  in
             foreign  securities involve additional  risks.   For
             defensive  purposes, the Fund may invest  in  short-
             term  money market instruments and cash.  The Fund's
             share  price  and investment return  fluctuate  such
             that  an investor's shares may be worth more or less
             than  original cost upon redemption.  The Fund seeks
             to  identify  and  invest in smaller  capitalization
             companies  falling  into  one  of  three  investment
             designations as described below.

PROCESS      In  order to identify opportunities from
             a  5,000 company universe, Dreyfus employs a  sector
             manager  approach  in its equity  research  process.
             The  process  is  driven  by  fundamental  research.
             Cash  flow  analysis is the initial step  including:
             outlining  an  issuer's long-term financial  posture
             as  the  central  fiduciary interest  of  management
             towards   shareholders;  establishing   management's
             true  evaluation of returns available from producing
             assets;  and exploring capital requirements critical
             for future growth.

             Dreyfus managers will typically assign one of  three
             investment   designations.   Primary   emphasis   is
             placed  on  growth  companies  defined  by  dominant
             market  position, sustained record  of  achievement,
             and  strong financial condition.  Expectation  of  a
             high growth rate should be matched by high rates  of
             return on invested capital.

             Relative   sector  attractiveness  is   the   second
             approach to stock selection and may comprise  20-30%
             of  the  portfolio.   Dreyfus attempts  to  identify
             prospective  economic or political change  that  may
             have  a  uniformly beneficial effect  on  an  entire
             industry.   Finally,  special  situations   may   be
             identified,  including  those  companies  active  in
             acquisition, divestiture, share repurchase or  other
             processes  which  develop corporate  focus.   A  key
             element  is evaluation of the corporation's  balance
             sheet  and  the  expected return on assets,  coupled
             with   management's  firm  resolve  to  aim   toward
             growth, not simple survival.

             Stocks  in the portfolio may be sold if the original
             investment      designation     (growth,      sector
             attractiveness, special situation)  breaks  down  or
             fails  to materialize.  Margin deterioration at  any
             level   is   frequently  the  early   indicator   of
             corporate  stress.   The balance  inherent  in  this
             structure can result in an all-weather, rather  than
             simply   aggressive,  approach  to   small   company
             investing.

<Page A-5>
MGMT. & DIST.  FEES   The  Fund  is a no-load mutual  fund.   The
             management  fee  is payable monthly  at  the  annual
             rate  of  0.75  of  1% of the value  of  the  Fund's
             average  daily  net assets.  The Fund bears  certain
             costs   for   services  provided   to   shareholders
             pursuant  to  a  Shareholder  Services  Plan  at  an
             annual  rate  of  0.25 of 1% of  the  value  of  the
             Fund's  average daily net assets.  A  1%  redemption
             fee  will  be  charged and retained by the  Fund  on
             certain  shares  redeemed or  exchanged  within  the
             first  six  months of issuance and will be  deducted
             from  redemption proceeds. The redemption  fee  will
             not   be  charged  for  redemption  of  Fund  shares
             through  omnibus  accounts  for  various  retirement
             plans,   as  well  as  certain  other  accounts   as
             described in the Fund's prospectus.
             
             *Benchmark used for comparative purposes only.
             
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation

<Page A-6>
                 DREYFUS NEW LEADERS FUND, INC.


PIE CHARTS DEPICTING SECTOR ALLOCATION VERSUS BENCHMARK AS OF MARCH 31, 1997

Tech/Cap Goods         21%              Tech/Cap Goods         18%
Consumer                8%              Consumer               18%
Mat'ls & Process       13%              Mat'ls & Process       11%
Energy                  4%              Energy                  5%
Credit Sens            27%              Credit Sens            33%
Healthcare             14%              Healthcare             10%
Other                   9%              Transport               4%
Cash                    4%              Other                   1%
                                                                
                      100%                                    100%
 DREYFUS NEW LEADERS FUND                  RUSSELL 2000 INDEX
             


TEN LARGEST                 OTHER                     PORTFOLIO
  HOLDINGS               INFORMATION               CHARACTERISTICS+
   AS OF                    AS OF               AS OF MARCH 31, 1997
FEBRUARY 28,            MARCH 31, 1997
    1997

Global       1.7%      Assets ($Mill)  693.6                 Fund   Russ 2000
Industries           
                                                 Price/                   
Executive    1.6%      Managment Fee    0.75%    Earnings    17.5      21.4
Risk                                             Ratio                  
                                                                  
Everest      1.6%      Total Expense    1.12%    Price/Book   3.1       2.3
Reinsurance            Ratio                     Ratio
Holdings        
                                                          
Varian       1.5%      Port. Turnover  102.22%   Med Mkt      1,045     340
Associates             Rate*                     Cap ($Mil)
                                                                               
Thiokol      1.5%      Net Asset       37.98     5-Yr Earnings 19.9    11.6
                       Value ($)                 Growth (%)
                                                                               
Consolidated 1.5%                                Dividend       0.7     1.6
Stores                                           Yield (%)++
                                                                  
Finova Group 1.4%                                Equity         0.99   1.00
                                                 Beta
                                                                  
Universal    1.4%      Primary         Since     Return Beta    0.92   1.00
Health                 Portfolio Mgrs. 
Services          
                                                                  
Crompton &   1.4%      Paul Kandel      1996     5 yr Std       10.6   11.0
Knowles                                          Dev (%)
                                                                  
Mentor       1.4%      Hilary Woods     1996     Number of       104   1911
                                                 Holdings
**As of last fiscal year end (12/31/96)

+Sources: FactSet & Frank Russell Co.
++Wtd. avg. dividend yield of equities in portfolio.



BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS
ENDED MARCH 31, 1997
          New Leaders   Russell
            (w/divs)   2000(w/divs)*

                -6.77%   -5.17%      
One Year         4.13%    5.11%      
Three Years     13.32%   12.70%      
Five Years      12.07%   12.78%      
Ten Years       11.40%    9.42%    
   Fund Inception January 29, 1985
                  

<Page A-7>
Calendar Year Performance+

       Dreyfus     Russell
         New         2000
       Leaders      Index*
        Fund       
                           
  1996  17.31%      16.50%
  1995  29.80%      28.44%
  1994  -0.15%      -1.82%
  1993  17.07%      18.91%
  1992   9.43%      18.41%
  1991  45.39%      46.05%
  1990 -11.86%     -19.51%
  1989  31.29%      16.24%
  1988  23.35%      24.89%
  1987  -5.12%      -8.77%
                                                      
+Reflects total return each year.
                          
Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may be worth more or less than original cost upon redemption.   A
1%  redemption fee will be charged and retained by  the  Fund  on
shares  redeemed  or  exchanged within the first  six  months  of
purchase.   Portfolio composition is subject  to  change  at  any
time.
*Source:  Frank  Russell  Company.  The  Russell  2000  Index  is
unmanaged; the performance results represent total return and the
reinvestment of dividends and other earnings.
This  material  must  be  preceded or accompanied  by  a  current
Prospectus  which  contains additional information  on  fees  and
expenses.  Please read the Prospectus carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109

<Page A-8>
                             DREYFUS
                       Retirement Services
                                
                      DREYFUS INTERNATIONAL
                           GROWTH FUND

FUND DESCRIPTION
The  Fund's  goal  is  to  provide you  with  capital  growth  by
investing primarily in foreign equity securities.

INVESTMENT STRATEGY
Under  normal market conditions at least 65% of the Fund's assets
will  be  invested in equity securities of foreign  issuers.  The
Fund  may  also invest in high grade debt securities  of  foreign
issuers  that management believes offer opportunities for capital
growth. While there are no geographic limits, the Fund will  seek
to  invest  its  assets in at least three foreign countries.  For
defensive   purposes  the  Fund  may  invest  in   money   market
securities.

INVESTOR PROFILE
The  Fund  may be appropriate for long-term investors  who  would
like to take advantage of international growth opportunities  and
are  willing  to  assume greater risks involved in  international
investing. An investment in the Fund should be as a supplement to
an overall investment program.

INVESTMENT RISKS
The Fund invests principally in common stocks of foreign issuers.
Generally  stock  prices  move up and down  in  response  to  the
performance  of  their issuers and general  economic  and  market
factors. The prices of stocks move in different degrees, based on
the  varying impact of these factors over time, which affects the
relative  volatility  of  a  fund.  Foreign  securities   involve
additional risks, including being subject to potentially volatile
political  and  economic climates and currency fluctuations.  The
Fund   can  use  sophisticated  investment  techniques  including
investments  in  derivative instruments. As a result  the  Fund's
portfolio  may  be  more  volatile than a portfolio  invested  in
domestic  equity  securities. When you sell your  shares  of  the
Fund, they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

    Management Fees                      .75%
    12b-1 Fees                           .51%
    Other Expenses                       .78%
    Total Portfolio Operating Expenses  2.04%

Example:  You  would  pay the following expenses  on  a  $1  ,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

                              Class R shares
    One year                   $ 21
    Three years                $ 64
    Five years                 $110
    Ten years                  $237

<Page A-9>
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Portfolio's  actual  performance
will vary and may be greater or less than 5 %.

INVESTMENT ADVISER
The  Dreyfus Corporation serves as the Fund's investment adviser.
The  Fund  portfolio  manager  is  Ronald  Chapman,  Director  of
International Equity for The Dreyfus Corporation.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends, and capital gains, if any, are declared and paid
annually. All distributions to retirement accounts will be
automatically reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING ALL OR
   A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS INVESTMENT
   OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES REPRESENTATIVE.

Premier Mutual Fund Services, Inc., Distributor
Copyright-1996 Dreyfus Retirement Services. a division of Dreyfus Service
Corporation, Broker/Dealer

<Page A-10>
DREYFUS INTERNATIONAL GROWTH FUND
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK         Morgan Stanley Capital International
                  Europe, Australia, Far East (EAFE)(Registered Trademark)
                  Index  with net dividends reinvested.*

STRATEGY          The  Fund invests primarily in equity
                  securities   of   foreign  issuers,   including
                  common   stocks,  convertible  securities   and
                  preferred stocks.  The Fund also may invest  in
                  debt   securities  of  foreign   issuers   that
                  management  believes  offer  opportunities  for
                  capital growth.

                  The  Fund's goal is to provide capital  growth.
                  There  can  be  no  assurance that  the  Fund's
                  investment  objective will  be  achieved.   The
                  Fund's  investment  in foreign  securities,  as
                  well   as   its   use  of  certain   investment
                  techniques,  involve additional  risks.   These
                  risks  are  described more fully in the  Fund's
                  Prospectus.    The  Fund's  share   price   and
                  investment   return  fluctuate  and   are   not
                  guaranteed.

PROCESS           At  least  65% of the  value  of
                  the    Fund's   total   assets   (except   when
                  maintaining  a  temporary  defensive  position)
                  will  be  invested  in  equity  securities   of
                  foreign  (non U.S.) issuers located  throughout
                  the  world.  The equity securities in which the
                  Fund   may  invest  include  those  of  issuers
                  located  in  emerging  markets,  which  present
                  additional   risks.    Under   normal    market
                  conditions  it  is expected that  substantially
                  all  of  the Fund's assets will be invested  in
                  securities  of  foreign issuers.   While  there
                  are  no  prescribed limits on geographic  asset
                  distribution  outside the  United  States,  the
                  Fund  ordinarily will seek to invest its assets
                  in no fewer than three foreign countries.
     
                  The Fund also may invest in debt securities  of
                  foreign   issuers  that  management   believes,
                  based   on  market  conditions,  the  financial
                  condition  of  the  issuer,  general   economic
                  conditions  and  other relevant factors,  offer
                  opportunities for capital growth.

MGMT. & ADMIN. FEES     The management fee is payable monthly  at
                  the  annual rate of 0.75 of 1% of the value  of
                  the  Fund's average daily net assets. The  Fund
                  pays    for    advertising,    marketing    and
                  distributing  its shares at an annual  rate  of
                  0.50  of  1% of the value of the Fund's average
                  daily  net  assets  under a  distribution  plan
                  adopted  pursuant  to  Rule  12b-1  under   the
                  Investment Company Act of 1940.  The Fund  also
                  pays  for the provision of certain services  to
                  its shareholders at the annual rate of 0.25  of
                  1%  of  the  value of the Fund's average  daily
                  net assets under a Shareholder Services Plan.

                  *Benchmark used for comparative purposes  only.
                  EAFE (Registed Trademark) is the property of Morgan
                  Stanley &  Co., Incorporated.
                  
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation

<Page A-11>
                DREYFUS INTERNATIONAL GROWTH FUND
                                
PIE CHARTS DEPICTING COUNTRY ALLOCATION VERSUS BENCHMARK AS OF
MARCH 31, 1997

DREYFUS                             MSCI EAFE(Registered Trademark) 
INTERNATIONAL                       INDEX
GROWTH FUND

      Japan             27%                   Japan           29%
      UK                 8%                   UK              20%
      Germany            9%                   Germany          9%
      France             7%                   France           8%
      Oth Europe        23%                   Switzerland      6%
      Malaysia           6%                   Oth Europe      17%
      Other             12%                   Hong Kong        4%
      Hong Kong          3%                   Other            7%
      Sht Term Sec       5%                                      
                                                            100%
                      100%                                      

 Ten Largest Holdings                      Other Information
   as of February 28, 1997                as of March 31, 1997

British Sky Broadcasting    2.2%                                

Parmalat Finanziaria        1.9%         Assets ($Mill)        84.2

Tele Brasileiras, ADR       1.8%         Management Fee#      0.75%

Deutsche Bank               1.7%         Total Expense Ratio  2.07%

Nintendo                    1.7%         Net Asset Value ($)  15.13

Banque Nationale De Paris   1.6%                             

Cultor Oy                   1.6%                          

Vodafone Group PLC          1.6%         Primary Portfolio Manager     Since

Goudsmit Nv                 1.5%         Ronald Chapman                Mar-96

Kfc Holdings Berhad         1.4%                       
 
                                                     # Annualized

BAR GRAPH DEPICTING PERFORMANCE FOR
PERIODS ENDED MARCH 31, 1997
                 Dreyfus        EAFE (Registered Trademark)
                 International  Index*
                 Growth         

1Q 97             1.88%          -1.57%
One Year          4.44%           1.45%
Three Years       2.58%           6.53%
Since Inception   7.33%           8.25%
                                  
                                                                    
Av. Annual Return Since Incept.            8.25%
                                  
Fund Inception June 29, 1993
                                  
                
<Page A-12>                  
Calendar Year Performance

          Dreyfus        MSCI
       International    EAFE(Registered Trademark)
        Growth Fund     Index*
                           
                             
  1996         8.49%     6.05%
  1995         0.70%    11.21%
  1994        -5.44%     7.84%
                           
                           
Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may  be  worth  more or less than original cost upon  redemption.
Performance figures reflect the absorption of certain expenses by
The Dreyfus Corporation; had such expenses not been absorbed, the
Fund's  performance would have been lower.  Portfolio composition
is subject to change at any time.
*Source: Morgan Stanley Capital International.  The EAFE (Registered
Trademark) Index, which   is   an   unmanaged  index  of  non-U.S.
equity   market performance,   is   the  property  of  Morgan   Stanley
&   Co. Incorporated;  the  performance  results  shown  represent  total
return  and reflect the reinvestment of net dividends  and  other
earnings.

This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109

<Page A-13>
                             DREYFUS
                       Retirement Services

                     DREYFUS CASH MANAGEMENT

FUND DESCRIPTION
The  Fund's goal is to provide investors with as high a level  of
current  income as is consistent with the preservation of capital
and the maintenance of liquidity.

INVESTMENT STRATEGY
The Fund invests in short-term money market obligations including
securities  issued  or guaranteed by the U.S. Government  or  its
agencies  or  instrumentalities. During normal market conditions,
the  Fund  will  invest  at  least 25%  of  its  assets  in  bank
obligations.  The Fund is managed to keep its share price  stable
at $1.00.

INVESTOR PROFILE
Dreyfus  Cash  Management is appropriate  for  investors  seeking
current income plus stability of principal.

INVESTMENT RISKS
The  Fund  is  managed to maintain a stable  $1.00  share  price.
However,  a  money market fund investment is neither insured  nor
guaranteed by the FDIC or the U.S. Government, and there  can  be
no guarantee that the $1.00 share price will be maintained. In an
effort  to  maintain a stable share price, the  Fund  invests  in
high-quality,  short-term  paper with  remaining  maturities  not
exceeding 13 months, and maintains an average portfolio  maturity
of  90  days  or  less. Sharp interest rate  changes  and  credit
concerns  related to portfolio securities, among  other  factors,
will impact the Fund's ability to maintain its share price.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                                          Class A shares
    Management Fees                            .20%
    Total Portfolio Operating Expenses         .20%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

                         Class A shares
    One year               $    2
    Three years            $    6
    Five years             $   11
    Ten years              $   26

These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and may be greater or less than 5%.

<Page A-14>
INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment adviser.

BUYING AND SELLING SHARES THROUGH YOUR 401(K) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends are generally declared daily and paid monthly.  Capital
gains,  if  any,  generally are declared and paid  annually.  All
distributions   to  retirement  accounts  will  be  automatically
reinvested in additional Fund Share.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal.

Premier Mutual Fund Services, Distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation

<Page A-15>
DREYFUS CASH MANAGEMENT
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK    Lipper  Institutional  Money  Market  Funds
             Average.*

STRATEGY     The  Fund  invests in short-term money  market
             obligations,   including   securities   issued    or
             guaranteed  by the U.S. Government or  its  agencies
             or  instrumentalities, certificates of deposit, time
             deposits,  bankers' acceptances and other short-term
             obligations  issued  by  domestic  banks  or  London
             branches  of  domestic banks, repurchase agreements,
             and  high-grade  commercial paper and  other  short-
             term corporate obligations.

             The  Fund's  objective is to provide investors  with
             as  high  a level of current income as is consistent
             with   the   preservation   of   capital   and   the
             maintenance  of  liquidity.   The  Fund   seeks   to
             maintain  a net asset value of $1.00 per  share  for
             purchases   and  redemptions.   The   Fund's   yield
             fluctuates  and there can be no assurance  that  the
             Fund  will  be able to maintain a stable  net  asset
             value of $1.00 per share.

             The  Fund  will  maintain a dollar-weighted  average
             portfolio  maturity  of 90 days  or  less,  purchase
             only  instruments having remaining maturities of  13
             months  or  less  and  invest only  in  U.S.  dollar
             denominated  securities  determined  in   accordance
             with   procedures  established  by  the   Board   of
             Trustees  to present minimal credit risks and  which
             are  rated  in one of two highest rating  categories
             for  debt  obligations  by at least  two  nationally
             recognized statistical rating organizations (or  one
             rating  organization if the instrument was rated  by
             only  one such organization) or, if unrated, are  of
             comparable   quality.   Moreover,  the   Fund   will
             purchase  only instruments so rated in  the  highest
             rating   category  or,  if  unrated,  of  comparable
             quality  as determined in accordance with procedures
             established  by  the  Board  of  Trustees.    During
             normal  market conditions, the Fund will  invest  at
             least 25% of its assets in bank obligations.

BACKGROUND   Dreyfus  Cash Management is an open-end, diversified
             money  market mutual fund.  It commenced  operations
             in  1985.   On  January  6,  1994,  the  Fund  began
             offering two classes of shares, namely Class  A  and
             Class  B  shares.  On November 20,  1996,  the  Fund
             commenced offering two additional classes of  shares
             designated  as Administrative Shares and Participant
             shares  and the renamed Class A and Class  B  shares
             as   Institutional   Shares  and  Investor   shares,
             respectively.

             The  Fund  is designed for institutional  investors,
             particularly banks, acting for themselves  or  in  a
             fiduciary,  advisory, agency, custodial  or  similar
             capacity.    Fund  shares  may  not   be   purchased
             directly  by individuals, although institutions  may
             purchase   shares   for   accounts   maintained   by
             individuals.

MGMT. & DIST.  FEES     The management fee is payable monthly  at
             the annual  rate  of  0.20 of 1% of  the  value  of  the
             Fund's  average  daily  net assets.   Administrative
             Shares, Investor Shares and Participant Shares  bear
             certain  costs for distribution and service  at  the
             annual  rate of 0.10 of 1%, 0.25 of 1%  and  .40  of
             1%,  respectively, of the value of the average daily
             net  assets attributable to such class in accordance
             with  a service plan adopted pursuant to Rule  12b-1
             under  the  Investment  Company  Act  of  1940,   as
             amended.    No  Rule  12b-1  costs  are   borne   by
             Institutional    Shares.    Total    expenses    for
             Institutional    Shares,   Administrative    Shares,
             Investor  Shares and Participant Shares  are  capped
             at 20, 30, 45 and 60 basis points, respectively.

<Page A-16>
             *Benchmark used for comparative purposes only.
             
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
            

<Page A-17>
                     DREYFUS CASH MANAGEMENT
                                
PIE CHART DEPICTING SECTOR
ALLOCATION AS OF
FEBRUARY 28, 1997

Corp Notes          6%
CD's               13%
Comm Paper         57%
US Gov't Agen      10%
ST Bank Notes       4%
Repo's             10%
Other               0%
                      
                  100%
Dreyfus Cash Management
                                
                            
General  Information
as of March 31, 1997
                                                     Institutional    Investor
                                                     Shares           Shares
                                   
Average Maturity      60 days        Assets ($Mil)      2,345.7         535.4
(2/28/97)
        
Number of Issues        87           Management Fee       0.20%         0.20%
(2/28/97)
                                     Total Expense Ratio  0.20%         0.45%
                         
                                     7-Day Yield          5.29%         5.05%
                         
Portfolio Manager      Since

P. Larkin               1991                         

+Unless The Dreyfus Corporation gives the Fund's investors at
least 90 days' notice to the contrary, The Dreyfus Corporation,
and not the Fund, will be liable for all expenses of the Fund
other than the following expenses, which will be borne by the
Fund:  (i) the management fee payable by the Fund to The Dreyfus
Corporation monthly at the annual rate of .20 of 1% of the value
of the Fund's average daily net assets; and (ii) as to
Administrative Shares, Investor Shares and Participant Shares
only, payments made at the annual rate of .10 of 1%, .25 of 1%,
 .40 of 1%, respectively, of the value of the average daily net
assets attributable to such class, pursuant to a service plan
adopted in accordance with Rule 12b-1 under the Investment
Company Act of 1940,

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED
MARCH 31, 1997 - INSTITUTIONAL SHARES

          Dreyfus Cash Mgmt  Lipper Inst'l
           (Institutional    Fd Avg**
               Shares)       
                      
1Q 97                 1.30%               1.24%
One Year              5.38%               5.12%
Three Years           5.35%               5.11%
Five Years            4.54%               4.33%
Ten Years             6.06%               5.86%
As of 3/31/97, total return for Investor Shares
for  1Q 1997  was 1.24%;  average annual  total
return  for  one  year  was  5.11%  and   since
inception on January 10, 1994 was 4.94%.
Fund Inception March 11, 1985
                                               
<Page A-18>
As of 3/31/97, total return for Investor Shares for 1Q 1997  was
1.24%;  average annual total return for one year was 5.11% and
since inception on January 10, 1994 was 4.94%.

Calendar Year Performance++
         Dreyfus        Lipper Inst'l
           Cash            MM Fund
        Management        Average**
       (Institutional           
          Shares)
                                       
  1996       5.42%          5.16%
  1995       6.01%          5.75%
  1994       4.08%          4.00%
  1993       3.17%          2.93%
  1992       3.80%          3.29%
  1991       6.22%          5.67%
  1990       8.38%          7.77%
  1989       9.51%          8.83%
  1988       7.67%          7.01%
  1987       6.67%          6.12%
                      
 ++Reflects total return each year.

An  investment  in the Fund is neither insured nor guaranteed  by
the  U.S. Government and there can be no assurance that the  Fund
will  be  able to maintain a stable net asset value of $1.00  per
share.   Past  performance  is no guarantee  of  future  results.
Yield fluctuates.  Portfolio composition is subject to change.
**Source:    Lipper  Analytical  Services,  Inc.   Reflects   the
reinvestment of income.
This  must  be  preceded  or accompanied by  the  Fund's  current
Prospectus  which  contains  additional  information   on   fees,
distribution  &  other  expenses.   Please  read  the  Prospectus
carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109

                            
<Page A-18>
                             DREYFUS
                       Retirement Services

                   DREYFUS SHORT, INTERMEDIATE
                         GOVERNMENT FUND

FUND DESCRIPTION
The Fund's goal is to provide you with as high a level of current
income  as is consistent with the preservation of capital through
investments in government securities.

INVESTMENT STRATEGY
The Fund will invest primarily in securities issued or guaranteed
by  the U.S. Government or its agencies or instrumentalities  and
repurchase  agreements  in respect of such.  The  Fund  will  not
purchase any securities with remaining maturities over three  and
half years. Short to intermediate term securities are designed to
provide  generally higher income than a government  money  market
fund  and less volatility in share price than a comparable higher
yielding longer-term bond fund. Neither the market value  of  the
Fund's portfolio securities nor the value of the Fund shares  are
guaranteed or insured by the U.S. Government.

INVESTOR PROFILE
Dreyfus Short-Intermediate Government Fund may be appropriate for
investors  seeking  high current income plus  the  credit  safety
provided by investments in U.S. Government securities.

INVESTMENT RISKS
The Fund invests in bonds. Bond prices are generally affected  by
changes  in  interest rates and/or supply and demand  conditions.
Because  the  Fund  is  a U.S. Government  bond  fund,  portfolio
securities are of the highest credit quality. The prices of bonds
move  in different degrees, based on the varying impact of  these
factors  over  time, which affects the relative volatility  of  a
fund.  The  Fund can also use sophisticated investment techniques
which  involve increased risk. When you sell your shares  of  the
Fund, they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                         Class R shares

     Management fees        .50%
     Other Expenses         .25%

     Total Portfolio Operating Expenses       .75%

<Page A-20>
Example:  You  would  pay the following expenses  on  a  $1  ,000
investment  assuming ( I ) a 5% annual return and (2)  redemption
at the end of each period


                         Class R shares
     One year               $  8
     Three year             $ 24
     Five year              $ 42
     Ten year               $ 93

These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and returns may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation is the Fund's investment manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to    shareholders.   Please   consult   your   Human   Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends are declared and paid monthly. Capital gains,  if  any,
are  declared and paid annually. All distributions to  retirement
accounts  will  be  automatically reinvested in  additional  Fund
shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual fund shares are not deposits or obligations of, or
guaranteed or endorsed by, any bank and are not federally insured
by the FDIC, the Federal Reserve Board or any other agency. All
mutual fund shares involve certain investment risks, including
the possible loss of principal.

Premier Mutual Fund Services, distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation


<Page A-21>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK      Merrill  Lynch  Governments, U.S.  Treasury,
               Short-Term (1-2.99 Years) Index.*

STRATEGY       The  Fund  invests in securities  issued  or
               guaranteed by the U.S. Government or its  agencies
               or  instrumentalities and repurchase agreements in
               respect of such securities.  These include:   U.S.
               Treasury Bills, Treasury Notes and Treasury Bonds;
               Government  National  Mortgage  Association  pass-
               through  certificates,  and  obligations  of   the
               Federal Home Loan Banks, Federal National Mortgage
               Association    and    Student    Loan    Marketing
               Association.   The maximum remaining  maturity  of
               any  instrument  held in the  portfolio  will  not
               exceed 3-1/2 years.

               The Fund's objective is to provide as high a level
               of  current  income  as  is  consistent  with  the
               preservation   of  capital.  The  value   of   the
               portfolio  securities held by the Fund  will  vary
               inversely to changes in prevailing interest rates.
               Neither  the market value of the Fund's  portfolio
               securities  nor the Fund's shares are  insured  or
               guaranteed  by  the U.S. Government.   The  Fund's
               share price, yield and investment return fluctuate
               and are not guaranteed.

MGMT. FEES     Dreyfus Short-Intermediate Government Fund is
               a  no-load  mutual  fund.  The management  fee  is
               payable monthly at the annual rate of 0.50  of  1%
               of  the  value  of  the Fund's average  daily  net
               assets.  Pursuant to a Shareholder Services  Plan,
               the  Fund  bears  expenses for  providing  certain
               services to the shareholders at an annual rate  of
               0.25% of 1% of the value of the average daily  net
               assets of the Fund.

               *Benchmark used for comparative purposes only.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation


<Page A-22>
           DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND

PIE CHARTS DEPICTING SECTOR ALLOCATION AND MATURITY BREAKDOWN AS
OF FEBRUARY 28, 1997

      US Treas Notes     75%               < 1 Year        4%
      US Gov & Agencies  25%               1-5 Years      96%
      US Treas Strips     0%                                
      Short Term Instr    0%                                 
                                                          
                        100%                             100%
  Dreyfus Short-Intermediate       Dreyfus Short-Intermediate
             Government Fund                  Government Fund


General Information
as of March 31, 1997
                                                 
Average Maturity         2.63 Years    Management Fee+        0.50%
(2/28/97)
       
Duration (2/28/97)       2.36 Years    Total Expense Ratio+   0.75%

Number of Issues            22         Net Asset Value ($)    10.71
(2/28/97)     
                                       Assets ($Mill)         542.5
                        
Portfolio Manager          Since                      

G. Thunelius                1994

+The Dreyfus Corporation has undertaken, until November 30, 1997
that if in any fiscal year the aggregate expenses (excluding
taxes and certain other expenses) of the Fund exceed 0.75 of 1%
of the value of the Fund's average daily net assets for the
fiscal year, the Fund may deduct from the payment to be made to
Dreyfus under the Management Agreement, or Dreyfus will bear such
excess expense.

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED MARCH 31, 1997

               Dreyfus      Merrill Lynch
             Short-         Governments, U.S.
             Intermediate   Treasury, Short
             Gov't Fund     Term (1-2.99 Years)
                            Index*
                 -0.07%               0.66%
One Year          4.07%               5.32%
Three Yrs         5.45%               5.83%
Five Yrs          6.15%               5.70%
Since Inception   7.17%                    


<Page A-23>
Calendar Year Performance**

        Dreyfus             Merrill Lynch
         Short-              Governments,
     Intermediate            US Treasury, 
       Government             Short Term
          Fund             (1-2.99 Years)
                                Index*
                                            
  1996      3.96%               4.98%
  1995     12.61%              11.00%
  1994     -0.75%               0.57%
  1993      7.33%               5.41%
  1992      7.02%               6.30%
  1991     13.50%              11.68%
  1990     10.04%               9.72%
  1989     11.29%              10.87%
  1988      5.64%               6.22%

Past  performance  is no guarantee of future results;  net  asset
value,   yield  and  investment  return  fluctuate  so  that   an
investor's  shares may be worth more or less than  original  cost
upon redemption.  Portfolio composition is subject to change.

*Source: Bloomberg Financial Markets.   The Index is an unmanaged
performance benchmark for Treasury securities with maturities  of
1-2.99  years.   Unlike the Fund, the index does  not  take  into
account   charges,  fees  and  other  expenses.    Reflects   the
reinvestment of income dividends and, where  applicable,  capital
gains distributions.

**The Fund's performance reflects the absorption of certain  Fund
expenses by The Dreyfus Corporation. Had these expenses not  been
absorbed, the Fund's total and average annual total returns would
have been lower.
This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
<Page A-24>
                             DREYFUS
                       Retirement Services
                                
                   DREYFUS S&P 500 INDEX FUND

FUND DESCRIPTION
The  Fund  seeks  to  replicate the overall  performance  of  the
Standard  & Poor's 500 Composite Stock Price Index (the "S&P  500
Index"  or the "index") primer fly through investments in  equity
securities which compose the Index. The S&P 500 Index is composed
of  500  stocks,  most  of which trade  on  the  New  York  Stock
Exchange,  and represents about 75% of the market  value  of  all
U.S. common stocks.

INVESTMENT STRATEGY
The Fund seeks to be fully invested in the common stocks included
in  the S&P 500 Index; at least 80% of the Fund's assets will  be
so invested. To maintain liquidity, the Fund may invest 5% of its
assets  in Short-Term securities. Each stock composing the  Index
is  weighted by its market capitalization relative to  the  total
market value of the Index, and the Fund's port folio seeks to  be
constructed in the same manner.

INVESTOR PROFILE
The  Dreyfus S&P 500 Index Fund may be appropriate for  investors
seeking  a  simplified and diversified approach to  stock  market
investing through investment in a stock index fund.

INVESTMENT RISKS
The  Fund  invests  principally in common  stocks  composing  the
Index.  Stock  prices  move  up  and  down  in  response  to  the
performance  of  their issuers and general  economic  and  market
factors. The prices of stocks move in different degrees, based on
the  varying impact of these factors over time, which affects the
relative  volatility  of a fund. The Fund can  use  sophisticated
investment   techniques  including  investments   in   derivative
instruments. The Fund's performance will be directly impacted  by
the  performance  of  the  Index.  Because  a  large  number   of
securities  compose  the  Index,  the  Fund  will  have   greater
difficulty replicating the performance of the Index to the extent
that  its assets are not sufficient to appropriately construct  a
representative portfolio. When you sell your shares of the  Fund,
they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

     Management Fee                 .30%
     Other Expenses                 .25%
     Total Fund Operating Expenses  .55%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

     One year                 $ 6
     Three years              $18
     Five years               $31
     Ten years                $69

<Page A-25>
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and may be greater or less than 5%.

INVESTMENT ADVISER
The  Dreyfus  Corporation serves as the  Fund's  manager.  Mellon
Equity Associates serves as the Fund's index manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends and capital gains, if any, generally are declared and
paid annually. All distributions to retirement accounts will be
automatically reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal,

Premier Mutual Fund Services, Distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation


<Page A-26>
DREYFUS INSTITUTIONAL S&P 500 STOCK INDEX FUND*

BENCHMARK      Standard & Poor's 500 Composite Stock  Price
               Index with dividends reinvested.

STRATEGY       The  Fund's  objective is to  replicate  the
               total   return  of  the  Standard  &  Poor's   500
               Composite  Stock Price Index ("S&P 500  Index"  or
               "Index")  primarily through investments in  equity
               securities.   There can be no assurance  that  the
               Fund's objective will be achieved.

PROCESS        The  Fund  is  not  managed  according   to
               traditional   methods   of   "active"   investment
               management, which involves the buying and  selling
               of  securities based upon economic, financial  and
               market analysis and investment judgment.  Instead,
               the Fund utilizes a "passive" investment approach,
               attempting to duplicate the investment performance
               of   the   S&P   500  Index  through   statistical
               procedures.

               The S&P 500 Index is composed of 500 common stocks
               that are selected by Standard & Poor's Corporation
               to  capture best the price performance of a  large
               cross-section  of the U.S. publicly  traded  stock
               market.   The 500 securities, most of which  trade
               on   the   New  York  Stock  Exchange,   represent
               approximately 75% of the market value of all  U.S.
               common stocks.  Each stock in the S&P 500 Index is
               weighted  by its market capitalization.  That  is,
               each  security  is  weighted by its  total  market
               value  relative to the total market value  of  all
               the  securities  in the S&P 500 Index.   Component
               stocks  included in the S&P 500 Index  are  chosen
               with  the aim of achieving a distribution  at  the
               index   level   representative  of   the   various
               components  of the U.S. economy and  therefore  do
               not   represent   the   500   largest   companies.
               Aggregate  market value and trading  activity  are
               also considered in the selection process.

               As the Fund's assets increase, the Fund expects to
               invest  in all 500 stocks in the S&P 500 Index  in
               proportion  to  their  weighting  in  the   Index,
               including Mellon Bank Corporation stock.   To  the
               extent  that the size of the Fund does not  permit
               it  to invest in all 500 stocks in the Index,  the
               Fund  will  purchase  a representative  sample  of
               stock  from each industry sector included  in  the
               Index  in  proportion to that industry's weighting
               in  the Index.  To the extent that the Fund  seeks
               to replicate the S&P 500 Index using such sampling
               techniques, a close correlation between the Fund's
               performance  and the performance of the  Index  is
               anticipated  in  both rising and falling  markets.
               The Fund attempts to achieve a correlation between
               the performance of its investments and that of the
               Index  of  at  least  0.95,  before  deduction  of
               expenses.   A correlation of 1.00 would  represent
               perfect   correlation  between  Fund   and   Index
               performance.    It   is   anticipated   that   the
               correlation of the Fund's performance to  that  of
               the  Index will increase as the size of  the  Fund
               increases.    The   Fund's  ability   to   achieve
               significant  correlation between  Fund  and  Index
               performance   may  be  affected  by   changes   in
               securities markets, changes in the composition  of
               the   Index  and  the  timing  of  purchases   and
               redemptions   of   Fund  shares.    Under   normal
               circumstances, the Fund invests at  least  95%  of
               its  assets in the common stocks included  in  the
               Index.

               "S&P 500" is a trademark of McGraw Hill, Inc.  and
               has  been  licensed  for use.   The  Fund  is  not
               sponsored, sold, endorsed or promoted by S&P,  and
               S&P   makes   no   representation  regarding   the
               advisability of investing in the Fund.

<Page A-27>
MGMT. & DIST. FEES   The Fund's management fee is computed  daily
               and  paid monthly at the annual rate of  0.20%  of
               the  Fund's average daily net assets less  certain
               expenses.   Effective  September  15,  1995,   the
               Fund's  management fee was reduced from  0.40%  to
               0.20%,   the   Fund's  name  changed  to   Dreyfus
               Institutional  S&P 500 Stock Index  Fund  and  the
               Fund's  separate   share class  designations  were
               eliminated  and  the Fund became  a  single  class
               fund.   Currently, the Fund's minimum initial  and
               subsequent investment requirements are $25,000 and
               $1,000,  respectively.  Please see the  Prospectus
               for further details.
          
               *  A  separate  portfolio  of  The  Dreyfus/Laurel
               Funds, Inc.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
               

<Page A-28>
         DREYFUS INSTITUTIONAL S&P 500 STOCK INDEX FUND
                                
PIE CHART DEPICTING SECTOR ALLOCATION AS OF MARCH 31, 1997
Health Care            10%
Energy                 10%
Utilities               9%
Interest Sens          15%
Consumer Staples       14%
Consumer Cyc/Disc      12%
Capital Spending       23%
Basic Industry          5%
Other                   2%
Cash                    0%
                          
                      100%

PIE CHART DEPICTING ASSET ALLOCATION AS OF MARCH 31, 1997

Common Stock           98%
Equit. Cash             2%
                          
                      100%

   Ten Largest Holdings                      Other Information
   as of March 31, 1997                    as of March 31, 1997

General             2.8%                          
 Electric

Coca-               2.4%                 Assets ($Mill)       500.0
 Cola                 

Exxon               2.3%                 Management Fee       0.20%
 
Intel               2.0%                 Total Expense Ratio  0.20%

Microsoft           1.9%                 Net Asset Value     $16.32
                                         Per Share
Merck & Co.         1.8%                            

Philip Morris       1.6%                            

Royal Dutch         1.6%                 Portfolio Manager    Since
 Petroleum

Procter & Gamble    1.4%                 Steve Falci         Inception

IBM                 1.2%                          
* Effective September 15, 1995, the Fund's separate share class
designations were eliminated and the Fund became a single class
fund.


BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED MARCH 31, 1997

                                 Dreyfus        
                              Institutional        S&P
                              S&P 500 Stock        500
                                  Index         (w/divs)**

1Q 97                               2.58%          2.68%
One Year                           19.49%         19.82%
Three Years                        21.78%         22.30%
Since Inception                    17.96%         18.30%
                                                        
Av. Annual Return Since Incept.                   18.30%
                   
Fund Inception September 30, 1993

<Page A-29>
Calendar Year Performance+

     Dreyfus Institutional           S&P
       S&P 500 Stock                 500
        Index Fund                 Index**
                     
                             
1996        22.76%                  22.96%
1995        36.82%                  37.58%
1994         0.83%                   1.32%
                             
+Reflects total return.

Past  performance is no guarantee of future results; share  price
and  investment return fluctuate so that an investor's shares may
be  worth  more  or  less  than  original cost  upon  redemption.
Effective  September  15,  1995, the Fund's  management  fee  was
reduced from .40% to .20% of the Fund's average daily net assets;
and  the Fund's separate share class designations were eliminated
and  the  Fund  became  a  single class  fund.   Since  inception
performance results reflect the performance of the Fund's  former
Class R shares (which were not subject to a Rule 12b-1 fee)  from
inception  on September 30, 1993 through September 14,  1995  and
the  performance of the Fund's single class of shares thereafter.
Portfolio composition is subject to change at anytime.
**  Source: Lipper Analytical Services, Inc.  The S&P 500  is  an
unmanaged index of stock market performance; performance  results
represent  total return and reflect the reinvestment of dividends
and other earnings.
This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109

<Page A-30>
                             DREYFUS
                       Retirement Services

                 DREYFUS DISCIPLINED STOCK FUND

FUND DESCRIPTION
The Dreyfus Disciplined Stock Fund seeks investment returns that
are consistently higher than the Standard & Poor's 500 Composite
Stock  Price Index (" S&P 500 Index"), by investing in a broadly
diver'  sifted  list of equity securities. The Fund  is  not  an
index fund.

INVESTMENT STRATEGY
Individual  security selection is the foundation of  the  Fund's
investment  approach.  The  Fund  will  use  sophisticated  risk
control  techniques  in  selecting  securities.  Consistency  of
returns  which  exceed the S&P 500 and stability of  the  Fund's
asset  value  relative to the S&P 500 are primary goals  of  the
investment  process.  Valuation  models  are  used  to  form   a
computerized ranking system which will select common stocks that
appear  to  be  over  or  undervalued.  The  system  will   then
categorize individual securities within each industry  according
to relative attractiveness. Fundamental analysis then determines
the most attractive of the top-rated securities and those issues
that should be sold. Under normal circumstances, at least 65% of
the  Fund's  total assets will be invested in equity securities.
For  defensive purposes the Fund can invest up to  20%  in  high
quality money market secu' rities.

INVESTOR PROFILE
This  Fund  may  be appropriate for investors seeking  long-term
growth  from  a portfolio composed of common stocks selected  by
the use of sophisticated quantitative analysis and techniques.

INVESTMENT RISKS
The Fund invests principally in stocks. Stock prices move up and
down in response to the performance of their issuers and general
economic  and  market  factors. The prices  of  stocks  move  in
different degrees, based on the varying impact of these  factors
over time, which affects the relative volatility of a fund.  The
Fund's  investment process uses a disciplined  control  of  fund
risk  and  a  rigorous security selection. Risk  is  managed  by
controlling potential size, growth rate, financial condition and
earnings variability. The structure of the Fund is controlled so
that characteristics such as economic sector, industry exposure,
growth,  size, volatility and quality are maintained similar  to
those of the S&P 500 at all times. When you sell your shares  of
the  Fund, they may be worth more or less than what you paid for
them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                  Class R shares
   Management fees        .90%
       12b- 1 Fees        None
    Other Expenses        .00%
Total Portfolio Operating Expenses .90%

<Page A-31>
Example:  You  would  pay the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption at
the end of each period.

                     Class R shares
          One year        $  9
          Three year      $ 29
          Five year       $ 50
          Ten year        $111

These  amounts should not be considered representative of future
expenses  and actual expenses may be greater or less than  those
indicated.  Moreover,  the Portfolio's actual  performance  will
vary and may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment adviser.
The Fund is managed by Burt Mullins, portfolio manager of Dreyfus
and a vice president for Mellon Bank, N.A., Dreyfus' parent
company.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS

Dividends,  if  any,  are  declared and paid  quarterly.  Capital
gains,  if  any,  generally are declared and paid  annually.  All
distributions   to  retirement  accounts  will  be  automatically
reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal.

The Fund is a separate Portfolio of The Dreyfus/Laurel Funds, Inc.

Premier Mutual Fund Services, Distributor
Copyright-1995  Dreyfus Retirement Services, a division of Dreyfus Service
Corporation


<Page A-32>
DREYFUS DISCIPLINED STOCK FUND*

BENCHMARK      Standard & Poor's 500 Composite Stock  Price
               Index.**

STRATEGY       The Fund seeks investment returns (including
               capital   appreciation  and  income)  consistently
               superior  to  the Standard & Poor's 500  Composite
               Stock  Price Index ("S&P 500 Index") by  investing
               in a broadly diversified list of equity securities
               generated   by  the  application  of  quantitative
               security selection and risk management techniques.
               There can be no assurance that the Fund will  meet
               its  stated  investment objective.   Under  normal
               market  conditions, at least  65%  of  the  Fund's
               total   assets   will   be  invested   in   equity
               securities.   A  certain percentage  of  assets  -
               typically less than 20% - may be placed  in  high-
               quality  money  market  securities  for  liquidity
               purposes.   The Fund's share price and  investment
               return  fluctuate  such that an investor's  shares
               may  be worth more or less than original cost upon
               redemption.

PROCESS        Individual   security  selection   is   the
               foundation  of  the  Fund's  investment  approach.
               Consistency  of returns which exceed the  S&P  500
               Index  and  stability of the  Fund's  asset  value
               relative to the S&P 500 Index are primary goals of
               the investment process.  More than 1,600 stocks of
               well-established   companies   are   analyzed   by
               computer, using up to 15 sophisticated statistical
               models.   The  result  is a  measurement  of  each
               stock's  attractiveness  based  on  many  factors,
               including  earnings  momentum, relative  valuation
               and dividend discount calculations, price to book,
               price to earnings and return on equity ratios.

               Next,    senior   investment   analysts   assemble
               information  on  individual  securities  collected
               from   a   variety   of   sources.    Using   both
               quantitative   and  fundamental  techniques,   the
               managers refine the relative ranking of stocks.

               This   investment  process  utilizes   disciplined
               management of fund risk and a process of  rigorous
               security  selection.   Risk  is  managed  in  that
               portfolio characteristics such as economic sector,
               industry  exposure, growth, size,  volatility  and
               quality are maintained similar to those of the S&P
               500 Index at all times.  Common stocks held in the
               Fund,  most  but  not all of which pay  dividends,
               typically  include  a  broad range  of  investment
               characteristics.  The Fund is not  an  index  fund
               and  its investments are not limited to securities
               of issuers in the S&P 500 Index.

MGMT. & DIST. FEES   The Fund's management fee is computed  daily
               and  paid  monthly at the annual rate of 0.90%  of
               the  Fund's average daily net assets less  certain
               expenses.   In order to compensate the  Investment
               Manager  for  paying virtually all of  the  Fund's
               expenses, the Fund's management fee is higher than
               the   management  fee  paid  by  most   investment
               companies.  Please see the Prospectus for complete
               details.  The Fund currently offers two classes of
               shares.  Effective July 15, 1996, the Fund's Class
               R  shares  were redesignated as Retail shares  and
               are  offered to any investor.  Also effective July
               15,   1996,   the  Fund's  Investor  shares   were
               redesignated  as  Institutional  shares  and   are
               offered  only  to  clients  of  banks,  securities
               brokers    or   dealers   and   other    financial
               institutions  that  have entered  into  a  Selling
               Agreement with the Fund's distributor and  omnibus
               accounts  held by institutions that  provide  sub-
               accounting  or  recordkeeping  services  to  their
               clients.      Existing     Institutional     class
               shareholders    may    continue    to     purchase
               Institutional shares whether or not they otherwise
               would   be   eligible  to  do  so.    The   Fund's
               Institutional shares currently are  subject  to  a
               Distribution Plan adopted pursuant to  Rule  12b-1
               under  the  Investment Company Act of  1940.   The
               Plan  allows the Fund to spend annually  0.25%  of
               its  average  daily  net  assets  attributable  to
               Institutional shares.  Please refer to the  Fund's
               Prospectus which contains more information on  the
               Fund's share classes.

               <Page A-33>
               *  A  separate  portfolio  of  The  Dreyfus/Laurel
                  Funds, Inc.
               ** Benchmark used for comparative purposes only.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation

               
<Page A-34>
                 DREYFUS DISCIPLINED STOCK FUND
                                
PIE CHARTS DEPICTING SECTOR ALLOCATION VERSUS BENCHMARK AS OF
MARCH 31, 1997

Fund                              Index     Health Care         9%
        Health Care        10%              Energy             10%
        Energy             10%              Utilities           9%
        Utilities           9%              Interest Sens      15%
        Interest Sens      15%              Consumer           12%
                                            Cyclical
        Consumer           12%              Consumer           14%
        Cyclical                            Staples
        Consumer           13%              Capital            23%
        Staples                             Spending
        Capital            23%              Basic Industry      5%
        Spending
        Basic               5%              Other               3%
        Industry
        Other               3%                                  0%
        Cash                0%                                       
                          100%                                100%
Dreyfus Disciplined Stock Fund              S&P 500 Index


Ten Largest Holdings                 Other Information
as of March 31, 1997                as of March 31, 1997

General Electric     2.8%                                    Retail
                                                             Shares* 
Intel                2.5%                

Coca-Cola            2.5%           Assets ($Bill)            1.015
        
Exxon Corp.          2.3%           Total Expense Ratio       0.90%

Microsoft            2.2%           Port. Turnover Rate+     64.47%
                          
Merck & Co.          2.1%           Net Asset Value ($)       26.57
                  
Phillip Morris Cos.  1.5%                        

Bell South Corp.     1.4%           Primary Portfolio Mgr     Since

IBM                  1.4%           Bert Mullins            Inception
        
Proctor & Gamble     1.4%                        
 
* Effective July 15, 1996, the Fund's Class R shares were redesignated as
  Retail shares.
+ As of 10/31/96.

              Dreyfus        S&P 500
             Disciplined    (w/divs)*
             Stock
             (Retail)
1Q 97                 0.64%      2.68%
One Year             18.80%     19.82%
Three Yrs            20.78%     22.30%
Five Yrs             16.23%     16.42%
Since Inception      16.42%     16.46%
                                      
                                      
Av. Annual Return Since Incept.             16.46%

Fund Inception December 31, 1987

<Page A-35>
Calendar Year Performance

       Dreyfus               S&P
      Disciplined            500
      Stock Fund           Index*
       (Retail                  
       Shares)
                          
1996     24.88%            22.96%
1995     36.86%            37.58%
1994     -1.04%             1.32%
1993     11.83%            10.06%
1992      7.58%             7.61%
1991     33.64%            30.40%
1990      0.23%            -3.11%
1989     34.33%            31.63%
1988     10.72%            16.56%
                          

Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may  be  worth  more or less than original cost upon  redemption.
Effective  July  15,  1996,  the  Fund's  Class  R  shares   were
redesignated  as Retail shares and are offered to  any  investor.
These performance figures relate to Retail shares only; the  Fund
also  offers Institutional shares. Institutional shares, but  not
Retail shares, are subject to a 0.25% Rule 12b-1 plan.  Portfolio
composition is subject to change at any time.
*Source:  Lipper Analytical Services, Inc.  The  S&P  500  is  an
unmanaged index of stock market performance.  Performance results
represent total return and reflect reinvestment of dividends.
This  must  be  preceded or accompanied by a  current  Prospectus
which contains additional information on fees, expenses and share
classes.   Please read the Prospectus carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109

<Page A-36>
                             DREYFUS
                       Retirement Services
                                
                    CAPITAL PRESERVATION FUND

FUND DESCRIPTION
The  Capital  Preservation Fund is a collective  investment  fund
that  seeks  high current income and stability of  principal.  It
invests  primarily in Guaranteed Investment Contracts (GICs)  and
similar  instruments  including  alternative  GICs  and  separate
account GICs.

Guaranteed  Investment Contracts are popular investment  vehicles
for  retirement  plans. GICs are contracts  issued  by  insurance
companies  that  guarantee stated rates  of  return  on  invested
assets  for  the  life  of  these contracts  and  the  return  of
principal at maturity.

INVESTMENT STRATEGY
The  Fund  will  invest  primarily in GICs  that  are  issued  by
insurance  companies meeting certain credit  criteria  and  other
similar  instruments  including  alternative  GICs  and  separate
account GICs. In addition, the Fund may also invest in repurchase
agreements,   private   placements,  certificates   of   deposit,
commercial paper, shares of registered investment companies, bank
investment contracts and corporate investment contracts.

INVESTOR PROFILE
This  Fund  may  be  appropriate for investors looking  for  high
current income with stability of principal.

INVESTMENT RISKS
There  can  be  no  assurance  that the  Fund  will  achieve  its
investment  objective  of high current income  and  stability  of
principal.  While  LaSalle  National Trust,  N.A.  will  seek  to
maintain  the  stability of the value of units  in  the  Fund  at
approximately one dollar ($1.00) per unit, neither the  value  of
the Fund's portfolio nor an investment in the Fund is insured  or
guaranteed and there can be no assurance that the value of  units
in  the Fund will not fluctuate. The Fund risks possible loss  of
principal  if  an issuer is unable to pay on or before  maturity.
Units  in  the  Fund  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, LaSalle National Trust, N.A.,  or  any
other  bank,  credit  union or insurance  company,  and  are  not
insured by the Federal Deposit Insurance Corporation, the Federal
Reserve Board, or any other agency.

ANNUAL FEE
LaSalle National Trust, N.A. charges each employee benefit  trust
participating  in  the Capital Preservation Fund  an  annual  fee
which covers LaSalle National Trust, N.A.'s fee for managing  the
Fund   and   The  Dreyfus  Trust  Company's  fee  for  performing
sub-accounting  and administrative services with respect  to  the
Fund.  The annual fee is generally 0.50 of 1% of each trust's  or
plan's  average daily net assets invested in the Fund. The annual
fee is accrued daily and paid on a monthly basis.

TRUSTEE AND PORTFOLIO MANAGER
LaSalle National Trust, N.A., based in Chicago, Illinois, is  the
Fund's  portfolio  manager. LaSalle National  Trust,  N.A.  is  a
subsidiary of ABN/AMRO Bank, N.V. While The Dreyfus Trust Company
performs certain sub-accounting and administrative services  with
respect to the Fund, LaSalle National Trust, N.A., as trustee and
portfolio  manager, is solely responsible for the management  and
investment performance of the Fund's portfolio.

<Page A-37>
BUYING AND SELLING UNITS THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment options available under your plan. Please consult with
your  Human Resources Representative for specific information  on
these and other related matters, including withdrawals from  your
plan.

DISTRIBUTIONS
Income distributed from the Fund will be applied to the purchase
of additional units in the Fund.

           THIS MATERIAL CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
  PLAN. IF YOU WOULD LIKE A COMPLETE PRODUCT DESCRIPTION BEFORE
  ALLOCATING ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO
   THIS INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Copyright-1996 The Dreyfus Trust Company. Trustee

<Page A-38>
CAPITAL PRESERVATION FUND (CPF)
MANAGED BY LASALLE NATIONAL TRUST, N.A.

STRATEGY       The Fund is a collective investment fund for
               employee   benefit  trusts  and  plans   investing
               primarily in guaranteed investment contracts, bank
               investment  contracts, money  market  instruments,
               separate   account  structures   and   alternative
               investment contracts.  The investment objective of
               the  Fund  is  stability  of  principal  and  high
               current income.

               All   GICs   purchased  will  be  from   insurance
               companies  which,  at the time  of  issuance,  are
               rated  at  least A by the A.M. Best Company,  Inc.
               In  addition, they will carry at least  a  minimum
               Townsend  &  Schupp rating of A-.   All  companies
               rated  by  Standard  &  Poor's,  at  the  time  of
               purchase,  must  carry  a AA-  rating.   All  U.S.
               Treasury and Agency obligations are considered  to
               be AAA equivalents.  All other investments will be
               from  an  approved  list  of  bank  and  corporate
               issuers.

               The  maximum average maturity of the fund will  be
               three years.  No GIC/BIC will be purchased with  a
               maturity  over  5 years.  Any alternative  GIC/BIC
               purchased will have an average life limited  to  6
               years.  In addition, the fund generally will  hold
               approximately  5% in money market instruments  and
               at least 20% of the fund's investments will mature
               in less than one year.

               The  portfolio  is  managed  by  LaSalle  National
               Trust, N.A.,  a pioneer in the development of  GIC
               funds.   In seeking its dual goals of high current
               income   and  principal  stability,  the   Capital
               Preservation   Fund's   management    follows    a
               conservative  investment  approach.    Safety   of
               principal is the primary concern.

               LaSalle  National  Trust,  N.A.  will  attempt  to
               maintain  the stability of the value of  units  in
               the  Fund  at approximately one dollar ($1.00  per
               unit).  However, the value of the Fund's portfolio
               is  not  guaranteed and there can be no  assurance
               that  the  value  of units in the  Fund  will  not
               fluctuate.

PROCESS        All   issuers  must  meet  minimum   credit
               standards  from several private and public  rating
               services.   While  high current income  and  price
               stability    are    important   concerns,    other
               considerations include:

               Diversification: The     portfolio     is
                                diversified  among  multiple  GIC
                                issuers,  which can  help  reduce
                                risk.

               Liquidity:       Benefit payments and  other
                                distributions  (e.g.   exchanges)
                                generally  can  be  made  without
                                long     delays    and    without
                                penalties   such   as   surrender
                                charges.
<Page A-39>
ANNUAL FEE     LaSalle National Trust, N.A. charges each employee
               benefit  trust participating in the CPF an  annual
               fee  which  covers LaSalle National Trust,  N.A.'s
               fee  for  managing the CPF and The  Dreyfus  Trust
               Company's  fee  for performing sub-accounting  and
               administrative services with respect to  the  CPF.
               The  annual  fee is generally 0.50 of 1%  of  each
               trust's   or  plan's  average  daily  net   assets
               invested  in the CPF.  The annual fee  is  accrued
               daily and paid on a monthly basis.

                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation

<Page A-40>
                    CAPITAL PRESERVATION FUND

   Ten Largest Holdings
   as of April 3, 1997
                                   
CDC Invest Man Corp Alternative                 11.2%

Nat'l Westminster Bank Alternative               9.4%

General Reinsurance Alternative                  8.4%

Gov't Money Mkt Instr.                           8.4%

JP Morgan Alternative                            8.0%
 
Rabobank Alternative                             7.8%
  
Peoples Security Life Alternative                7.2%
 
Pacific Mutual Alternative                       6.5%

John Hancock Actively Managed Alternative        5.2%

Commonwealth Life Alternative                    5.0%

Capital Preservation Fund


Pie Chart Depicting Maturity
Breakdown as of April 3, 1997
                     
< 1 Year          20%
1 - 2 Years       15%
2 - 3 Years       23%
3 - 4 Years       10%
4 - 6 Years       32%
                     
                 100%


Portfolio Characteristics
as of April 3, 1997
                                               
Weighted Avg Maturity               2 years,  10 months

Number of Issuers                         19

Assets ($Bill)                           2.04


<Page A-41>
BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS
ENDED MARCH 31, 1997
              Capital
            Preservation
                Fund
1Q 97           1.54%     
One Year        6.38%     
Three Years     6.33%     
Five Years      6.36%     
Ten Years       7.50%     


Calendar Year Performance
                            
Capital Preservation Fund
                            
  1996            6.38%        
  1995            6.38%        
  1994            6.11%        
  1993            6.12%     
  1992            7.10%     
  1991            8.38%     
  1990            8.87%     
  1989            8.90%     
  1988            8.77%     
  1987            8.56%     
                               
Past   performance  is  no  guarantee  of  future  results.    An
investment  in the CPF is neither insured nor guaranteed  by  the
U.S.   Government.   Units  in  the  CPF  are  not  deposits   or
obligations  of,  or guaranteed or endorsed by, LaSalle  National
Trust,  N.A. or any other bank, and are not Federally insured  by
the  Federal  Deposit Insurance Corporation, the Federal  Reserve
Board,  or any other agency.  While LaSalle National Trust,  N.A.
will  attempt to maintain the stability of the value of units  in
the  CPF at approximately one dollar per unit, the value  of  the
CPF's  portfolio is not guaranteed and there can be no  assurance
that the value of units in the CPF will not fluctuate.  The CPF's
performance  shown  here  does  not  reflect  The  Dreyfus  Trust
Company's  fee  for  providing subaccounting  and  administrative
services for the CPF.
                                                                 
Please see the current Product Description for more complete
information.

<Page A-42>
                          COMPANY STOCK

     The following information regarding the Company Stock
investment option has been provided by the Company.

     ON DECEMBER 23, 1996, WESTMORELAND COAL COMPANY AND FOUR
SUBSIDIARIES, WESTMORELAND RESOURCES, INC., WESTMORELAND COAL
SALES COMPANY, WESTMORELAND ENERGY, INC., AND WESTMORELAND
TERMINAL COMPANY (THE "DEBTOR CORPORATIONS"), FILED VOLUNTARY
PETITIONS FOR REORGANIZATION UNDER CHAPTER 11 OF THE UNITED
STATES BANKRUPTCY CODE IN THE UNITED STATES BANKRUPTCY COURT FOR
THE DISTRICT OF COLORADO.  AT THE DATE OF THIS PROSPECTUS, THE
DEBTOR CORPORATIONS ARE IN POSSESSION OF THEIR RESPECTIVE
PROPERTIES AND ASSETS AND ARE OPERATING AS DEBTORS IN POSSESSION
PURSUANT TO PROVISIONS OF THE BANKRUPTCY CODE.  NO ASSURANCE CAN
BE GIVEN THAT THE DEBTOR CORPORATIONS WILL BE SUCCESSFUL IN
REORGANIZING THEIR AFFAIRS WITHIN THE CHAPTER 11 BANKRUPTCY
PROCEEDINGS.  REGARDLESS OF WHETHER THE DEBTOR CORPORATIONS ARE
SUCCESSFUL IN THIS EFFORT, THE RIGHTS AND BENEFITS ATTACHED TO
THE COMPANY'S COMMON STOCK AND PREFERRED STOCK ARE SUBJECT TO
MODIFICATION BY THE BANKRUPTCY COURT, AND THESE MODIFICATIONS CAN
SIGNIFICANTLY REDUCE OR ELIMINATE THE VALUE OF THESE SECURITIES.

     Contributions to the Company Stock fund will be used to
purchase Company Stock at prevailing market prices. Company Stock
was traded on the New York Stock Exchange ("NYSE") through
December 23, 1996 under the symbols "WCX" for the Common Stock
and "WCXPRA" for the Depositary Shares.  Prices shown below for
this period are the high and low sales prices on the NYSE.  From
December 24, 1996 through February 6, 1997, there was not an
established public trading market for the Company Stock.  Since
February 7, 1997, the Company Stock has been traded over-the-
counter under the symbols "WMCLQ" for the Common Stock and
"WMCCQ" for the Depositary Shares and reported on the Over-The-
Counter Bulletin Board. Prices shown below for the latter period
are the range of high and low bid quotations as reported by the
National Quotation Bureau.  The bid quotations are inter-dealer
bid prices without allowance for mark-ups, mark-downs or
commissions and may not necessarily reflect actual transactions.

                    Common Stock        Depository Shares
                                                       Quarterly
                    High      Low        High     Low  Dividend
1994
First Quarter       5 7/8   4 1/4       20      15 1/4   .53125
Second Quarter      5 1/4   4 3/8       16 1/4  13 1/2    -
Third Quarter       6 3/8   4 3/8       18 3/4  15 1/4    -
Fourth Quarter      7 1/8   3 3/4       17 7/8  14        -

1995
First Quarter       6 5/8   4 1/2       19      14 1/4   .53125
Second Quarter      5 3/8   4 1/4       14 3/4  12       .53125
Third Quarter       4 1/2   2 1/2       13 1/2  9         -
Fourth Quarter      3 5/8   2 1/2       10 1/4  6         -

<Page A-43>
1996

First Quarter       3 5/8   2 1/2       7 7/8    6        -
Second Quarter      4 1/4   2 3/4       12 7/8   7 1/2    -
Third Quarter       2 1/2   2 3/4       9 7/8    8 3/4    -
Fourth Quarter      3 3/8   1           10       6 3/8    -
    (through December 23)

1997

First Quarter       7/8     1/2         5 3/4    2         -
    (after February 6)
Second Quarter      15/16   17/32       5 1/2    5         -
Third Quarter       1       15/16       5 1/4    5 1/8     -
 (through July 28)

On July 28, 1997, the closing bid price for the Company's Common
Stock was $1 and the closing bid price for the Company's
Depository Shares was $ 5-1/8.  As with other stocks, the value
of the Company Stock can fluctuate and your investment can
increase or decrease in value depending upon the market
performance of Company Stock.

DIVIDENDS

The Company has not paid cash dividends on its Common Stock since
the fourth quarter of 1992. Future payments of cash dividends, if
any, will be determined by the Board of Directors based upon
circumstances then existing, including, without limitation,
contractual restrictions and the financial condition, capital
requirements, cash flow, profitability and business outlook of
the Company.  Common Stock dividends may not be declared until
the Preferred Stock dividends that are in arrears are made
current.

Preferred Stock dividends at the annual rate of $2.125 per
Depositary Share were paid quarterly from the third quarter of
1992 through the first quarter of 1994.  The declaration and
payment of Preferred Stock dividends was suspended in the second
quarter of 1994 in connection with extension agreements of the
Company's principal lenders.  Upon the expiration of these
extension agreements, the Company paid a quarterly dividend on
April 1, 1995 and July 1, 1995. Pursuant to the requirements of
Delaware law, the Preferred Stock dividend was suspended in the
third quarter of 1995 as a result of recognition of losses and
the subsequent shareholders' deficit. As of the date of this
Prospectus, there are ten quarterly dividends in arrears
(dividend payment dates  July 1, 1994, October 1, 1994, January
1, 1995, October 1, 1995,  January 1, 1996, April 1, 1996, July
1, 1996, October 1, 1996, January 1, 1997 and April 1, 1997 and
July 1, 1997) in the total amount of $13,441,000 in the aggregate
($5.84375 per Depositary Share).

There are statutory restrictions limiting the payment of
Preferred Stock dividends under Delaware law, the state in which
the Company is incorporated.  Under Delaware law, the Company is
permitted to pay Preferred Stock dividends only: (1) out of
surplus, surplus being the amount of shareholders' equity in
excess of the par value of the Company's two classes of stock; or
(2) in the event there is no surplus, out of net profits for the
fiscal year in which a Preferred Stock dividend is declared
(and/or out of net profits from the preceding fiscal year), but
only to the extent that shareholders' equity exceeds the par
value of the Preferred Stock ($575,000).

<Page A-44>
As a result of the filing by the Company of a voluntary petition
for reorganization under Chapter 11 of the United States
Bankruptcy Code, the Company is prohibited from paying dividends,
either on the Common Stock or the Preferred Stock.

                                        July 30, 1997


                           *    *    *


     This document constitutes part of a prospectus covering
         securities that have been registered under the
                     Securities Act of 1933.

<Page B-1>
                          APPENDIX B TO
            SUMMARY PLAN DESCRIPTION AND PROSPECTUS
                      DATED JULY 30, 1997


               DESCRIPTION OF THE PREFERRED STOCK

  The  statements  under this caption relating to  the  Preferred
Stock  are  summaries and do not purport  to  be  complete.  Such
summaries make use of certain terms defined in the Certificate of
Designation for  the Series A Convertible Exchangeable  Preferred
Stock  (the  "Certificate of Designation") and are  qualified  in
their  entirety  by  express  reference  to  the  Certificate  of
Designation, a copy of which is incorporated by reference as   an
exhibit to the Registration Statement of which this Prospectus is
a  part. Summaries herein of certain  provisions of the Company's
Certificate  of  Incorporation, as amended (the  "Certificate  of
Incorporation"), do not purport to be complete  and  are  subject
and  qualified in their entirety by reference  to all  provisions
of  the Certificate of Incorporation. As used under this caption,
the  term "Company"  refers only to Westmoreland Coal Company and
not to its subsidiaries.

GENERAL

  The  authorized capital stock of the Company includes 5,000,000
shares  of preferred stock, par  value $1.00 per share, of  which
575,000  shares, represented by 2,300,000 Depositary Shares,  are
currently outstanding.

RANKING

  The  Preferred Stock ranks prior to the Company's Common Stock.
Without the requisite vote of  holders of the Preferred Stock  as
described  below  under  "Limitations," no  class  or  series  of
capital  stock  can be created ranking pari passu with or  senior
to  the  Preferred  Stock as to dividend  rights  or  liquidation
preference.

DIVIDEND RIGHTS

   The  holders of the Preferred Stock are entitled  to  receive,
when, as and if  declared by the Company's Board of Directors out
of  funds of the Company legally available therefor  (and subject
to  the  limitation  described  in  the  last  sentence  of  this
paragraph), cumulative cash dividends  at the rate of 8-1/2%  per
annum  per  share (equivalent to $2.125 per annum per  Depositary
Share),   payable  quarterly on April 1, July 1,  October  1  and
January  1 in each year. Such dividends shall be cumulative  from
the  date  of original issuance. The Company will pay each   such
dividend to the holders of record of the Preferred Stock as  they
appear on its stock register on the  record date, which shall not
be more than 30 days nor less than 10 days preceding the dividend
payment  date.  If  a holder converts shares of  Preferred  Stock
after the close of business on the record date for a dividend and
before  the  opening  of business on the payment  date  for  such
dividend,  the holder will be required to pay to the  Company  at
the  time  of  such conversion the amount of such dividend.   See
"Conversion" below.

<Page B-2>
  THE COMPANY HAS NOT PAID DIVIDENDS ON THE PREFERRED STOCK SINCE
JULY  1,  1995  AND  AT  THE DATE OF THIS  PROSPECTUS  IS  ELEVEN
QUARTERLY DIVIDENDS IN ARREARS (INCLUDING UNPAID DIVIDENDS  PRIOR
TO  JULY 1, 1997).  SEE "APPENDIX A, AVAILABLE INVESTMENT OPTIONS
- COMPANY STOCK DIVIDENDS."

  If  dividends  are not paid in full, or declared  in  full  and
sums  set apart for the payment thereof, upon the Preferred Stock
and any other preferred stock ranking on a parity as to dividends
with  the  Preferred  Stock,  all  dividends  declared  upon  the
Preferred Stock and any other preferred stock ranking on a parity
as  to dividends will be paid or declared pro rata so that in all
cases  the amount of dividends paid or declared per share on  the
Preferred Stock and such other preferred stock will bear to  each
other  the  same  ratio  that accumulated  dividends  per  share,
including  dividends  accrued or  in  arrears,  if  any,  on  the
Preferred  Stock  and such other preferred  stock  bear  to  each
other. Except as provided in the preceding sentence, unless  full
cumulative  dividends on the Preferred Stock have  been  paid  or
declared  in full and sums set aside for the payment thereof,  no
dividends  (other than dividends in Common Stock or other  shares
of  the  Company's capital stock ranking junior to the  Preferred
Stock as to dividends) may be paid or declared and set aside  for
the  payment or other distribution made upon the Common Stock or,
except  as  provided  above, on any other capital  stock  of  the
Company ranking junior to or on a parity with the Preferred Stock
as  to  dividends, nor may any Common Stock or any other  capital
stock  ranking junior to or on a parity with the Preferred  Stock
as  to dividends be redeemed, purchased or otherwise acquired for
any  consideration  (or any payment made to or  available  for  a
sinking  fund for the redemption of any shares of such stock)  by
the  Company  or  any  subsidiary  of  the  Company  (except   by
conversion  into  or exchange for capital stock  of  the  Company
ranking junior to the Preferred Stock as to dividends).

  Dividends  payable on the Preferred Stock for any  period  less
than  a  full quarterly dividend period will be computed  on  the
basis  of  a 360-day year of twelve 30-day months and the  actual
number of days elapsed in the period for which payable.

CONVERSION RIGHTS

  Holders   of   the  Preferred  Stock  will  have   the   right,
exercisable at any time and from time to time, except in the case
of Preferred Stock called for redemption or to be exchanged for 8-
1/4%  Convertible Subordinated Debentures due June 15, 2002  (the
"Exchange  Debentures"), to convert all  or  any  such  Preferred
Stock into shares of the Common Stock at the conversion price  of
$14.64  per  share of Common Stock (equivalent  to  a  conversion
ratio of 1.708 shares of Common Stock for each Depositary Share),
subject  to  adjustment as described below. In the  case  of  the
Preferred  Stock  called for redemption or to  be  exchanged  for
Exchange  Debentures, conversion rights will expire at the  close
of  business on the business day immediately preceding  the  date
fixed for redemption or on the business day immediately preceding
the  exchange  date, as the case may be. Notice  of  an  optional
redemption must be mailed not less than 30 days and not more than
60  days  prior  to  the  redemption date.  Upon  conversion,  no
adjustment  or repayment will be made for dividends, but  if  any
holder surrenders a share of Preferred Stock for conversion after
the  close  of business on the record date for the payment  of  a
dividend  and  prior  to  the opening of  business  on  the  next
dividend payment date, then, notwithstanding such conversion, the
dividend  payable on such dividend payment date will be  paid  to
the  registered holder of such share on such record date. In such
event,  such  share,  when surrendered for  conversion,  must  be
accompanied by payment of an amount equal to the dividend payable
on  such  dividend  payment date on the share  so  converted.  No
fractional  shares  of  the  Common Stock  will  be  issued  upon
conversion  and,  if  the  conversion  results  in  a  fractional
interest,  an amount will be paid in cash equal to the  value  of
such  fractional interest based on the market price of the Common
Stock on the last trading day prior to the date of conversion.

<Page B-3>
   The  conversion price is subject to adjustment upon the occurr
ence  of certain events, including (i) the issuance of shares  of
Common  Stock as a dividend or distribution on the Common  Stock;
(ii)  the  subdivision or combination of the  outstanding  Common
Stock;  (iii) the issuance to substantially all holders of Common
Stock  of rights or warrants to subscribe for or purchase  Common
Stock  (or securities convertible into Common Stock) at  a  price
per  share less than the then current market price per share,  as
defined  in the Certificate of Designation; (iv) the distribution
to  all holders of Common Stock of shares of capital stock of the
Company  (other than Common Stock), evidences of indebtedness  or
other  assets  (excluding dividends in cash  out  of  current  or
retained earnings); and (v) the distribution to substantially all
holders  of  Common Stock of rights or warrants to subscribe  for
securities (other than those referred to in clause (iii)  above).
In  the  event of a distribution to substantially all holders  of
Common Stock of rights to subscribe for additional shares of  the
Company's  capital stock (other than those referred to in  clause
(iii) above), the Company may, instead of making an adjustment in
the  conversion price, make proper provision so that each  holder
of  a  share of Preferred Stock who converts such Preferred Stock
shall be entitled to receive upon such conversion, in addition to
shares  of Common Stock, an appropriate number of such rights  or
warrants.  No  adjustment of the conversion price  will  be  made
until cumulative adjustments amount to one percent or more of the
conversion  price  as  last  adjusted.  No  adjustment   of   the
conversion price will be made for cash dividends.

  If  the  Company reclassifies or changes its outstanding Common
Stock, or consolidates with or merges into or transfers or leases
all  or substantially all its assets to any person, or is a party
to  a  merger that reclassifies or changes its outstanding Common
Stock, the Preferred Stock will become convertible into the  kind
and  amount of securities, cash or other assets which the holders
of  the  Preferred Stock would have owned immediately  after  the
transaction  if  the  holders had converted the  Preferred  Stock
immediately before the effective date of the transaction.

  Conversion of shares of the Preferred Stock may be effected  by
delivering  certificates evidencing such  shares,  together  with
written  notice  of  conversion and a proper assignment  of  such
certificates to the Company or in blank, to the office or  agency
to  be maintained by the Company for that purpose. Initially such
office  will  be the principal corporate office of First  Chicago
Trust  Company of New York located at 30 West Broadway, New York,
New York, 10007.

<Page B-4>
LIQUIDATION PREFERENCE

  In  the event of any liquidation, dissolution, or winding up of
the affairs of the Company, whether voluntary or otherwise, after
payment or provision for payment of the Company's debts and other
liabilities, the holders of the Preferred Stock will be  entitled
to  receive, out of the remaining net assets of the Company,  the
amount  of  $100  in cash for each share of the  Preferred  Stock
(equivalent to $25 per Depositary Share), plus an amount in  cash
equal  to all dividends accrued and unpaid on each such share  up
to  the  date fixed for distribution, before any distribution  is
made  to  the  holders of the Common Stock or any  other  capital
stock of the Company ranking (as to any such distribution) junior
to  the Preferred Stock. If upon any liquidation, dissolution  or
winding  up  of the Company, the assets distributable  among  the
holders  of  shares of Preferred Stock and all other classes  and
series  of  preferred stock ranking (as to any such distribution)
on  a  parity with the Preferred Stock are insufficient to permit
the  payment  in full to the holders of all such  shares  of  all
preferential amounts payable to all such holders, then the entire
assets  of  the  Company thus distributable will  be  distributed
ratably  among  the holders of the Preferred  Stock  and  of  all
classes  and  series of preferred stock ranking (as to  any  such
distribution) on a parity with the Preferred Stock in  proportion
to the respective amounts that would be payable per share if such
assets were sufficient to permit payment in full.

  For  purposes of this section, a distribution of assets in  any
dissolution, winding up or liquidation will not include  (i)  any
consolidation  or merger of the Company with or  into  any  other
corporation,  (ii) any dissolution, liquidation, winding  up,  or
reorganization   of   the   Company   immediately   followed   by
reincorporation of another corporation or (iii) a sale  or  other
disposition  of all or substantially all of the Company's  assets
to  another  corporation; provided that, in each case,  effective
provision  is  made  in the certificate of incorporation  of  the
resulting  and surviving corporation or otherwise for the  protec
tion of the rights of the holders of Preferred Stock.

OPTIONAL REDEMPTION

The Preferred Stock may be redeemed at the option of the Company,
in  whole or from time to time in part, at any time on and  after
July  1,  1996, at the following redemption prices per  share  if
redeemed during the twelve-month period beginning July 1  of  the
year  indicated below, plus, in each case, all dividends  accrued
and  unpaid  on  the  Preferred Stock up to the  date  fixed  for
redemption, upon giving notice as provided below:

                    Redemption Price
                    (Per Share of         Dollar Equivalent
          Year      Preferred Stock)     Per Depositary Share

          1996          $105.10                  $26.28
          1997           104.25                   26.06
          1998           103.40                   25.85
          1999           102.55                   25.64
          2000           101.70                   25.43
          2001           100.85                   25.21
          2002
          and thereafter 100.00                   25.00

<Page B-5>
If  fewer  than  all of the outstanding shares of  the  Preferred
Stock  are  to  be  redeemed, the shares to be redeemed  will  be
determined  pro  rata  or  by lot or  in  such  other  manner  as
prescribed by the Company's Board of Directors.

  At  least  30 days but not more than 60 days prior to the  date
fixed for the redemption of the Preferred Stock, a written notice
will be mailed to each holder of record of Preferred Stock to  be
redeemed,  notifying  such holder of the  Company's  election  to
redeem such shares, stating the date fixed for redemption thereof
(the  "Preferred Stock Redemption Date"), and calling  upon  such
holder  to  surrender  to  the Company  on  the  Preferred  Stock
Redemption  Date  at  the place designated  in  such  notice  the
certificate  or  certificates representing the number  of  shares
specified  therein.  On or after the Preferred  Stock  Redemption
Date,  each holder of Preferred Stock to be redeemed must present
and surrender his certificate or certificates for such shares  to
the  Company at the place designated in such notice and thereupon
the  redemption price of such shares will be paid to  or  on  the
order  of  the  person whose name appears on such certificate  or
certificates   as   the  owner  thereof  and   each   surrendered
certificate  will be canceled. Should fewer than all  the  shares
represented   by  any  such  certificate  be  redeemed,   a   new
certificate  will  be issued representing the unredeemed  shares.
From  and  after the Preferred Stock Redemption Date (unless  the
Company  defaults  in  payment  of  the  redemption  price),  all
dividends  on  the shares of the Preferred Stock  designated  for
redemption in such notice will cease to accrue and all rights  of
the  holders thereof as shareholders of the Company,  except  the
right  to  receive  the redemption price thereof  (including  all
accrued and unpaid dividends up to the Preferred Stock Redemption
Date),  will  cease  and  terminate  and  such  shares  will  not
thereafter  be  transferred  (except  with  the  consent  of  the
Company)  on  the Company's books, and such shares shall  not  be
deemed  to  be  outstanding for any purpose  whatsoever.  At  its
election,  the  Company, prior to the Preferred Stock  Redemption
Date,  may  deposit  the redemption price of the  shares  of  the
Preferred Stock so called for redemption in trust for the holders
thereof  with a bank or trust company, in which case such  notice
to  holders  of the shares of the Preferred Stock to be  redeemed
will  (i) state the date of such deposit, (ii) specify the office
of  such  bank  or trust company as the place of payment  of  the
redemption  price and (iii) call upon such holders  to  surrender
the  certificates representing such shares at such  place  on  or
after the date fixed in such redemption notice (which may not  be
later  than the Preferred Stock Redemption Date), against payment
of  the  redemption price (including all accrued and unpaid  divi
dends  up to the Preferred Stock Redemption Date). Any moneys  so
deposited  which remain unclaimed by the holders of the Preferred
Stock  at  the  end  of  two  years  after  the  Preferred  Stock
Redemption Date will be returned by such bank or trust company to
the Company.

EXCHANGE

   At  the Company's option, all, but not less than all,  of  the
then  outstanding shares of the Preferred Stock may be  exchanged
on  any dividend payment date commencing July 1, 1996, subject to
certain  conditions  stated  below, for  the  Company's  Exchange
Debentures on not less than 30 days nor more than 60 days notice,
at  an  exchange  rate  of  $100  principal  amount  of  Exchange
Debentures  for each share of the Preferred Stock (equivalent  to
$25  principal amount of Exchange Debentures for each  Depositary
Share).  Such  exchange  may be made only  if,  at  the  time  of
exchange   (i)   the   Exchange  Indenture  (as   defined   under
"Description  of  the  Exchange  Debentures")  shall  have   been
qualified under the Trust Indenture Act of 1939, (ii) there shall
be  no  dividend arrearage on the Preferred Stock (including  the
dividend  payable on the date of exchange) and (iii) no Event  of
Default under the Exchange Indenture shall have occurred  and  be
continuing.  The  Exchange  Indenture  may  not  be  amended   or
supplemented before the date of exchange without the  affirmative
vote  or  consent  of  the holders of two-thirds  of  outstanding
shares  of  the  Preferred Stock, except that no  amendment  that
would  adversely  affect  the legal  rights  of  the  holders  of
Exchange Debentures may be taken without the affirmative vote  or
consent of all the holders of the outstanding shares of Preferred
Stock.  At  the  exchange  date, the rights  of  holders  of  the
Preferred Stock shall cease and the person or persons entitled to
receive Exchange Debentures issuable upon such exchange shall  be
treated  as  the  registered holder or holders of  such  Exchange
Debentures.  Interest will accrue on the Exchange Debentures from
the date of exchange.

<Page B-6>
VOTING RIGHTS

   Each share of Preferred Stock shall entitle the holder thereof
to four votes on any matter on which the holders of the Company's
capital  stock have the right to vote, including the election  of
directors. In addition, holders of the Preferred Stock will  have
voting rights (i) as provided under "Limitations" below, (ii)  in
the event the Company shall have failed to declare and pay or set
apart  for payment in full the preferential dividends accumulated
on the outstanding Preferred Stock for any six quarterly dividend
payment   periods,  whether  or  not  consecutive  (a   "Dividend
Non-Payment"), and (iii) as required by law. In the  event  of  a
Dividend Non-Payment, the number of directors of the Company will
be  increased by two and the holders of the outstanding Preferred
Stock,  voting  together as a class with  all  other  classes  or
series  of preferred stock ranking on a parity with the Preferred
Stock  with  respect to dividends or distribution of assets  upon
liquidation  and  then entitled to vote on the election  of  such
additional  directors,  will  be  entitled  to  elect  such   two
additional directors until the full dividends accumulated on  all
outstanding Preferred Stock shall have been declared and paid  or
set  apart  for payment.  Pursuant to this provision,  Robert  E.
Killen  and James W. Sight were elected as directors at a special
meeting  of  holders of the Depositary Shares held  in  September
1996.

LIMITATIONS

  In  addition to any other rights provided by applicable law, so
long  as  any shares of the Preferred Stock are outstanding,  the
Company  will not, without the affirmative vote, or  the  written
consent as provided by law, of the holders of at least two-thirds
of  the  outstanding shares of the Preferred Stock, voting  as  a
class:

     (a) authorize or issue any class or series of, or rights  to
     subscribe to or any security convertible into, capital stock
     ranking pari passu with or senior to the Preferred Stock  as
     to payment of
     dividends,  in  distribution of assets upon  liquidation  or
     voting rights; or
     
     (b) change the preferences, rights or powers with respect to
     the  Preferred  Stock  so as to affect  such  capital  stock
     adversely.

   Except as may otherwise be required by applicable law, such  a
class vote or consent is not required (i) in connection with  any
increase  in  the  total number of authorized  shares  of  Common
Stock,  or (ii) in connection with the authorization or  increase
of  any  class  or series of shares ranking, as to dividends  and
distribution of assets upon liquidation, junior to the  Preferred
Stock.  No  such  vote or written consent of the holders  of  the
Preferred Stock is required if, at or prior to the time when  the
issuance  of any such stock ranking prior to the Preferred  Stock
is  to be made or any such change is to take effect, as the  case
may  be,  provision  is made for the redemption  of  all  of  the
Preferred  Stock at the time outstanding. The Company  may  issue
its  presently  authorized but unissued  shares  of  its  capital
stock,   or  bonds,  notes,  mortgages,  debentures,  and   other
obligations,  and  incur  indebtedness  to  banks  and  to  other
lenders.  Certain changes in the Exchange Indenture  (as  defined
below)  may  not  be  effected without the  affirmative  vote  or
consent of the holders of two-thirds of the outstanding shares of
the   Preferred   Stock.  See  "Description   of   the   Exchange
Debentures-General."

<Page B-7>
PREEMPTIVE RIGHTS

  No  holder  of the Preferred Stock will have preemptive  rights
to subscribe for or acquire any unissued shares of the Company or
securities of the Company convertible into or carrying a right to
subscribe to or acquire shares.

TRANSFER AGENT

  The  Registrar,  Transfer Agent and Conversion  Agent  for  the
Preferred  Stock is First Chicago Trust Company of New York.  The
Company will act as Paying Agent for the Preferred Stock.
  

              DESCRIPTION OF THE DEPOSITARY SHARES

GENERAL

  The  Company  has issued receipts ("Depositary  Receipts")  for
Depositary  Shares, each of which represents  one  quarter  of  a
share   of  Preferred  Stock.  The  shares  of  Preferred   Stock
represented  by Depositary Shares are deposited under  a  Deposit
Agreement  (the  "Deposit Agreement") among  the  Company,  First
Chicago  Trust  Company  of New York (the "Depositary")  and  the
holders from time to time of the Depositary Receipts. Subject  to
the  terms  of the Deposit Agreement, each owner of a  Depositary
Share is entitled, in proportion to the applicable fraction of  a
share of Preferred Stock represented by such Depositary Share, to
all the rights and preferences of the Preferred Stock represented
thereby  (including dividend, voting, conversion, redemption  and
liquidation rights).

  The  Depositary  Shares  are evidenced by  Depositary  Receipts
issued pursuant to the Deposit Agreement.  Copies of the forms of
Deposit Agreement and Depositary Receipt may be obtained from the
Company  upon request, and the following summary is qualified  in
its entirety by reference thereto.

<Page B-8>
DIVIDENDS AND OTHER DISTRIBUTIONS

  The   Depositary  distributes  all  dividends  or  other   cash
distributions received in respect of the Preferred Stock  to  the
record  holders of Depositary Shares in proportion to the  number
of  such  Depositary  Shares owned by such  holders,  subject  to
certain  obligations of holders to file proofs, certificates  and
other information and to pay certain charges and expenses to  the
Depositary.

  In  the  event  of  a  distribution other  than  in  cash,  the
Depositary would distribute property received by it to the record
holders of Depositary Shares entitled thereto, subject to certain
obligations  of  holders to file proofs, certificates  and  other
information  and  to  pay certain charges  and  expenses  to  the
Depositary,  unless  the Depositary determines  that  it  is  not
feasible  to make such distribution, in which case the Depositary
may,  with  the approval of the Company, sell such  property  and
distribute the net proceeds from such sale to such holders.

WITHDRAWAL OF STOCK

   Upon surrender of the Depositary Receipts at the corporate  tr
ust  office  of  the  Depositary (unless the  related  Depositary
Shares have previously been called for redemption), the holder of
the  Depositary Shares evidenced thereby is entitled to delivery,
at  such  office  to or upon his order, of the  number  of  whole
shares  of  the  Preferred Stock and any money or other  property
represented  by  such  Depositary Shares. Holders  of  Depositary
Shares  will be entitled to receive whole shares of the Preferred
Stock on the basis of one share of Preferred Stock for each  four
Depositary Shares, but holders of such whole shares of  Preferred
Stock  will  not  thereafter be entitled  to  receive  Depositary
Shares  therefor.  If the Depositary Receipts  delivered  by  the
holder  evidence a number of Depositary Shares in excess  of  the
number  of  Depositary Shares representing the  number  of  whole
shares  of  Preferred Stock to be withdrawn, the Depositary  will
deliver  to such holder at the same time a new Depositary Receipt
evidencing such excess number of Depositary Shares.

REDEMPTION OF DEPOSITARY SHARES

   Whenever the Company redeems shares of Preferred Stock held by
the  Depositary,  the  Depositary will  redeem  as  of  the  same
redemption  date  the  number of Depositary  Shares  representing
shares  of  the referred Stock so redeemed, provided the  Company
shall have paid in full to the Depositary the redemption price of
the  Preferred Stock to be redeemed plus an amount equal  to  any
accrued  and  unpaid  dividends thereon to  the  date  fixed  for
redemption.  The redemption price per Depositary  Share  will  be
equal  to  the redemption price and any other amounts  per  share
payable with respect to the Preferred Stock. If less than all the
Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by the Depositary by lot or pro rata or
other equitable method, in each case as may be determined by  the
Company.

<Page B-9>
VOTING THE PREFERRED STOCK

   Upon receipt of notice of any meeting at which the holders  of
the  Preferred  Stock are entitled to vote, the  Depositary  will
mail  the information contained in such notice of meeting to  the
record  holders  of the Depositary Shares relating  to  Preferred
Stock. Each record holder of such Depositary Shares on the record
date  (which  will be the same date as the record  date  for  the
Preferred Stock) is entitled to instruct the Depositary as to the
exercise  of  the  voting  rights pertaining  to  the  amount  of
Preferred  Stock represented by such holder's Depositary  Shares.
The Depositary will endeavor, insofar as practicable, to vote the
amount  of Preferred Stock represented by such Depositary  Shares
in   accordance  with  such  instructions,  and  the  Company  is
obligated  to  take  all reasonable action which  may  be  deemed
necessary by the Depositary in order to enable the Depositary  to
do  so.  The  Depositary  will  abstain  from  voting  shares  of
Preferred  Stock  to  the  extent it does  not  receive  specific
instructions  from the holders of Depositary Shares  representing
Preferred Stock.

CONVERSION OF PREFERRED STOCK

  The Depositary Shares, as such, are not convertible into Common
Stock  or  any  other  securities or  property  of  the  Company.
Nevertheless,  the  Depositary Receipts  may  be  surrendered  by
holders   thereof to the Depositary with written instructions  to
the Depositary to instruct the Company to cause conversion of the
Preferred Stock represented by the Depositary Shares evidenced by
such  receipts into whole shares of Common Stock, and the Company
has agreed that upon receipt of such instructions and any amounts
payable  in respect thereof, it will cause the conversion thereof
utilizing  the same procedures as those provided for delivery  of
Preferred  Stock  to effect such conversions. If  the  Depositary
Shares represented by a Depositary Receipt are to be converted in
part  only, a new Depositary Receipt or Receipts will  be  issued
for  any  Depositary Shares not to be converted. See "Description
of Preferred Stock-Conversion Rights."

     EXCHANGE OF PREFERRED STOCK

   Whenever  the Company exchanges all of the shares of Preferred
Stock  held  by  the  Depositary  for  Exchange  Debentures,  the
Depositary  will  exchange  as of  the  same  exchange  date  all
Depositary Shares representing all of the shares of the Preferred
Stock  so exchanged for Exchange Debentures, provided the Company
shall  have  issued  and deposited with the  Depositary  Exchange
Debentures  for all of the shares of the Preferred  Stock  to  be
exchanged. The exchange rate per Depositary Share shall be  equal
to one quarter of the exchange rate per share of Preferred Stock,
plus  all money and other property, if any, represented  by  such
Depositary  Shares, including all amounts paid by the Company  in
respect  of dividends which on the exchange date have accrued  on
the  shares  of Preferred Stock to be so exchanged and  have  not
theretofore been paid.

<Page B-10>
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT

  The  form  of  Depositary  Receipt  evidencing  the  Depositary
Shares and any provision of the Deposit Agreement may at any time
be  amended  by agreement between the Company and the Depositary.
However,  any amendment that materially and adversely alters  the
rights  of the holders of Depositary Shares will not be effective
unless  such  amendment has been approved by the  holders  of  at
least  a majority (or, in the case of amendments relating  to  or
affecting rights to receive dividends or distributions or voting,
redemption  or  conversion rights, two-thirds) of the  Depositary
Shares then outstanding.

  The  Deposit  Agreement may be terminated by the  Company  upon
not  less  than  60  days' notice whereupon the Depositary  shall
deliver  or make available to each holder of Depositary Receipts,
upon  surrender of the Depositary Receipts held by  such  holder,
such  number  of  whole or fractional shares of  Preferred  Stock
represented   by  such  receipts.  The  Deposit  Agreement   will
automatically terminate if (i) all outstanding Depositary  Shares
have  been redeemed, (ii) there has been a final distribution  in
respect   of   the  Preferred  Stock  in  connection   with   any
liquidation,  dissolution or winding up of the Company  and  such
distribution  has been distributed to the holders  of  Depositary
Receipts  or (iii) each share of Preferred Stock shall have  been
converted into shares of Common Stock.

CHARGES OF DEPOSITARY

  The   Company  will  pay  all  transfer  and  other  taxes  and
governmental  charges arising solely from the  existence  of  the
Depositary  arrangements.  The Company  will  pay  the  fees  and
expenses of the Depositary in connection with the performance  of
its  duties  under the Deposit Agreement. Holders  of  Depositary
Receipts  must  pay  transfer and other  taxes  and  governmental
charges and such other charges as are expressly provided  in  the
Deposit Agreement to be for their accounts.

MISCELLANEOUS

  The  Depositary  will forward to holders of  Depositary  Shares
any  reports  and  communications  from  the  Company  which  are
received by the Depositary.

  Neither the Depositary nor the Company will be liable if it  is
prevented from or delayed in, by law or any circumstances  beyond
its   control,  performing  its  obligations  under  the  Deposit
Agreement.  The  obligations of the Company  and  the  Depositary
under  the  Deposit  Agreement are limited  to  performing  their
duties  thereunder without negligence or willful misconduct,  and
the Company and the Depositary are not obligated to prosecute  or
defend  any legal proceeding in respect of any Depositary  Shares
or   any   Preferred  Stock  unless  satisfactory  indemnity   is
furnished. The Company and the Depositary may rely on  advice  of
counsel  or  accountants,  or  information  provided  by  persons
presenting  Preferred  Stock for deposit, holders  of  Depositary
Shares  or  other persons believed to be authorized or  competent
and on documents believed to be genuine.

  In  the  event the Depositary shall receive conflicting claims,
requests or instructions from any holders of Depositary Receipts,
on  the  one  hand,  and  the Company, on  the  other  hand,  the
Depositary  shall be entitled to act on such claims, requests  or
instructions received from the Company.

<Page B-11>
RESIGNATION AND REMOVAL OF DEPOSITARY

The  Depositary  may  resign at any time  by  delivering  to  the
Company notice of its election to do so, and the Company  may  at
any  time remove the Depositary, any such resignation or  removal
to  take,  effect upon the appointment of a successor Depositary,
which successor Depositary must be appointed within 60 days after
delivery  of the notice of resignation or removal and must  be  a
bank  or trust company having its principal office in the  United
States  and  having a combined capital and surplus  of  at  least
$50,000,000.


             DESCRIPTION OF THE EXCHANGE DEBENTURES
                                
GENERAL

  The  Exchange  Debentures will, if and when issued,  be  issued
under  an indenture (the "Exchange Indenture") to be dated as  of
the  date  of  issuance  (the "Exchange Date")  of  the  Exchange
Debentures,  between  the  Company and  Fidelity  Bank,  National
Association  (the "Exchange Trustee").  A copy  of  the  proposed
form of the Exchange Indenture is incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus is
a part. The Exchange Indenture may not be amended or supplemented
before  the Exchange Date without the affirmative vote or consent
of  the  holders of two-thirds of the outstanding shares  of  the
Preferred  Stock, except that no amendment that  would  adversely
affect the legal rights of the holders of Exchange Debentures may
be  taken  without  the affirmative vote or consent  of  all  the
holders   of  the  Preferred  Stock.  The  summaries  of  certain
provisions of the Exchange Indenture hereunder do not purport  to
be  complete  and  are  subject to, and are  qualified  in  their
entirety  by reference to, all of the provisions of the  Exchange
Indenture, including the definitions therein of certain terms and
those  terms made part of the Exchange Indenture by reference  to
the  Trust Indenture Act of 1939 as in effect on the date of  the
Exchange Indenture.

  The  Exchange  Debentures will bear interest from the  Exchange
Date at the rate of 8-1/2% per annum payable on April 1, July  1,
October  1  and January 1 in each year, commencing on  the  first
such interest payment date next succeeding the Exchange Date,  to
holders  of  record ("Holders") at the close of business  on  the
first  day  of  the  month  of such interest  payment  date.  The
Exchange Debentures will be due on July 1, 2012, will be issued in
registered  form, without coupons, only in denominations  of  $25
and  integral multiples of $25 and will be unsecured  obligations
of   the  Company  which  will  be  subordinated  to  the  Senior
Indebtedness   of  the  Company.  The  Indenture  authorizes   an
aggregate  principal  amount  of  $57,500,000  of  the   Exchange
Debentures.

<Page B-12>
CONVERSION

  The  holder  of  any Exchange Debenture will  have  the  right,
exercisable  at  any  time  prior to  maturity,  to  convert  the
principal  amount  thereof (or any portion  thereof  that  is  an
integral  multiple  of $25) into shares of Common  Stock  at  the
conversion  price set forth on the cover page of this Prospectus,
subject   to  adjustment  as  described  below  (the  "Conversion
Price"),  except  that  if an Exchange Debenture  is  called  for
redemption, the conversion right will terminate at the  close  of
business on the business day immediately preceding the date fixed
for redemption. Upon conversion, no adjustment or payment will be
made  for interest or dividends, but if any holder surrenders  an
Exchange Debenture for conversion after the close of business  on
the record date for the payment of an installment of interest and
prior  to  the  opening of business on the next interest  payment
date, then, notwithstanding such conversion, the interest payable
on  such  interest  payment date will be paid to  the  registered
holder  of such Exchange Debenture on such record date.  In  such
event,   such   an  Exchange  Debenture,  when  surrendered   for
conversion, must be accompanied by payment of an amount equal  to
the interest payable on such interest payment date on the portion
so converted. No fractional shares will be issued upon conversion
but  a  cash adjustment will be made for any fractional interest.
The  Conversion  Price  is  subject to  adjustment  in  a  manner
substantially  identical to that provided  with  respect  to  the
Preferred    Stock.   See   "Description   of    the    Preferred
Stock-Conversion."

OPTIONAL REDEMPTION

   The  Exchange Debentures may be redeemed at the option of  the
Company, in whole or from time to time in part, on and after July
1,  1996,  on not less than 30 nor more than 60 days'  notice  by
first  class mail, at the following redemption prices  (expressed
as  percentages of the principal amount) if redeemed  during  the
twelve-month period beginning July 1 of the year indicated below,
in  each  case, together with accrued and unpaid interest thereon
to the redemption date:

             Year                         Price
             1996                         105.10%
             1997                         104.25
             1998                         103.40
             1999                         102.55
             2000                         101.70
             2001                         100.85
             2002 and thereafter          100.00

  If  less  than all the Exchange Debentures are to be  redeemed,
the  Trustee  will select Exchange Debentures for redemption  pro
rata  or  by lot. If any Exchange Debenture is to be redeemed  in
part  only,  a  new Exchange Debenture or Exchange Debentures  in
principal  amount  equal  to  the  unredeemed  principal  portion
thereof will be issued.

<Page B-13>
PURCHASE OF EXCHANGE DEBENTURES AT THE OPTION OF THE HOLDER UPON
A CHANGE IN CONTROL

  If  any  Change  in Control (as defined below) of  the  Company
occurs   on  or  prior  to  maturity,  each  holder  of  Exchange
Debentures  will have the right, at the holder's option,  subject
to  the  terms  and conditions of the Indenture, to  require  the
Company  to purchase all or any part (equal to $25 or an integral
multiple thereof) of the holder's Exchange Debentures on the date
that  is 35 business days after the occurrence of such Change  in
Control  (the "Change in Control Purchase Date") at a cash  price
equal to principal amount plus accrued and unpaid interest to the
Change  in Control Purchase Date (the "Change in Control Purchase
Price").

  Within  15  business  days after the  Change  in  Control,  the
Company  is obligated to mail to the Trustee and each  holder  of
Exchange  Debentures  (and to beneficial owners  as  required  by
applicable law) a written notice of the Change in Control,  which
notice  shall state, among other things (i) the events causing  a
Change  in  Control and the date of such Change in Control,  (ii)
the last date on which the purchase right may be exercised, (iii)
the  Change in Control Purchase Price, (iv) the Change in Control
Purchase Date, (v) the name and address of the Trustee and of any
other  office  or  agency  maintained  for  the  purpose  of  the
surrender  of  Exchange  Debentures for purchase,  and  (vi)  the
procedures  that holders of Exchange Debentures  must  follow  to
exercise  these  rights. The Company will cause a  copy  of  such
notice to be published in the national edition of The Wall Street
Journal.

  To  exercise this right, the holder must deliver written notice
(a "Change in Control Purchase Notice") to the Trustee, or to any
other office or agency designated by the Company, of the exercise
of  such  right prior to the close of business on the  Change  in
Control Purchase Date. The Change in Control Purchase Notice must
state  (i) the certificate numbers of the Exchange Debentures  to
be  delivered by the holder thereof for purchase by the  Company,
(ii)  the  portion of the principal amount of Exchange Debentures
to  be  purchased,  which portion must  be  $25  or  an  integral
multiple thereof, and (iii) that such Exchange Debentures are  to
be  purchased  by  the Company on the Change in Control  Purchase
Date  pursuant  to  the  applicable provisions  of  the  Exchange
Debentures.

  Any  Change in Control Purchase Notice may be withdrawn by  the
holder  by  a  written  notice  of withdrawal  delivered  to  the
Trustee,  or  to  any other office or agency  designated  by  the
Company, prior to the close of business on the Change in  Control
Purchase Date. The notice of withdrawal shall state the principal
amount and the certificate numbers of the Exchange Debentures  to
which the withdrawal notice relates and the principal amount,  if
any,  which  remains subject to the original  Change  in  Control
Purchase  Notice  and  which has been or will  be  delivered  for
purchase by the Company.

  Payment of the Change in Control Purchase Price for an Exchange
Debenture for which a Change in Control Purchase Notice has  been
delivered and not withdrawn is conditioned upon delivery of  such
Exchange Debenture (together with necessary endorsements) to  the
Trustee,  or  to  any other office or agency  designated  by  the
Company, at any time (whether prior to, on or after the Change in
Control  Purchase Date) after delivery of such Change in  Control
Purchase Notice. Payment of the Change in Control Purchase  Price
for  such Exchange Debenture will be made promptly following  the
later  of  the  Change in Control Purchase Date or  the  time  of
delivery  of  such Exchange Debenture. If the Trustee  holds,  in
accordance with the Indenture, money sufficient to pay the Change
in  Control  Purchase  Price of such Exchange  Debenture  on  the
Change  in  Control Purchase Date, then, as of the  business  day
following  the  Change in Control Purchase  Date,  such  Exchange
Debenture  shall  cease to be outstanding and  interest  on  such
Exchange  Debenture  will cease to accrue, whether  or  not  such
Exchange  Debenture is delivered to the Trustee or to  any  other
office  or  agency  maintained for such purpose,  and  all  other
rights  of  the holder shall terminate (other than the  right  to
receive the Change in Control Purchase Price upon delivery of the
Exchange Debenture).

  Under  the  Indenture,  a "Change in Control"  of  the  Company
means  the  occurrence  after the date  thereof  of  any  of  the
following events: (i) any person (within the meaning of  Sections
13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934,  as
amended  (the  "Exchange Act"), including  a  group  (within  the
meaning  of  Rule 13d-5(b)(1) under the Exchange  Act),  together
with  any  affiliates and associates thereof, filing a report  of
Schedule  13D  or 14D-1 pursuant to the Exchange  Act  disclosing
that  such  person has become the beneficial owner of either  (a)
50% or more of the shares of Common Stock then outstanding or (b)
securities representing 50% or more of the combined voting  power
of   the   Company's  Voting  Stock  (as  defined   below)   then
outstanding; (ii) any sale, transfer, lease or conveyance of  all
or  substantially all of the properties and assets of the Company
to  any person (other than a subsidiary of the Company); or (iii)
any  consolidation or merger of the Company in which the  Company
is  not  the sole surviving or continuing corporation or pursuant
to  which the Common Stock is converted into cash, securities  or
other property, other than a consolidation or merger in which the
holders of the Common Stock immediately prior to such transaction
receive,  directly or indirectly, (a) 75% or more of  the  common
stock of the sole surviving or continuing corporation outstanding
immediately after such consolidation or merger and (b) securities
representing  75%  or more of the combined voting  power  of  the
surviving  or  continuing corporation's Voting Stock  outstanding
immediately  after such consolidation or merger.  "Voting  Stock"
means,  with  respect to any person, the capital  stock  of  such
person  having  general voting power under ordinary circumstances
to  elect at least a majority of the board of directors, managers
or trustees of such person (irrespective of whether or not at the
time  capital stock of any other class or classes shall  have  or
might  have  voting  power  by reason of  the  happening  of  any
contingency).

  The  Company will comply with the provisions of Rule 13e-4  and
any other tender offer rules under the Exchange Act that may then
be  applicable  and  will  file a Schedule  13E-4  or  any  other
schedule required thereunder in connection with any offer by  the
Company  to purchase Exchange Debentures at the option of holders
upon  a Change in Control. The Change in Control purchase feature
of the Exchange Debentures may in certain circumstances make more
difficult or discourage a takeover of the Company and, thus,  the
removal  of incumbent management. The Change in Control  purchase
feature is not, however, the result of management's knowledge  of
any  specific efforts to accumulate shares of Common Stock or  to
obtain control of the Company by means of a merger, tender offer,
solicitation of proxies or consents or otherwise, or  part  of  a
plan  to  implement a series of anti-takeover measures.  Instead,
the  Change  in  Control  purchase feature  is  a  commonly  used
provision  designed to facilitate the marketing of  the  Exchange
Debentures,  and the specific terms of such purchase feature  are
the   result  of  negotiations  between  the  Company   and   the
Underwriter.

    The   Company  could,  in  the  future,  enter  into  certain
transactions, including certain recapitalizations of the Company,
that  would  not  constitute  a  Change  in  Control  under   the
Indenture,  but  that  would  increase  the  amount   of   Senior
Indebtedness  (or  any other indebtedness)  outstanding  at  such
time.  There are no restrictions in the Indenture on the creation
of  additional  Senior Indebtedness (or any other  indebtedness),
and,  under  certain circumstances, the incurrence of significant
amounts  of additional indebtedness could have an adverse  effect
on  the  Company's ability to service its indebtedness, including
the  Exchange  Debentures. If such a Change in  Control  were  to
occur,  there  can  be no assurance that the Company  would  have
sufficient funds to pay the Change in Control Purchase Price  for
all  Exchange  Debentures  tendered by  the  holders  thereof.  A
default  by  the Company on its obligation to pay the  Change  in
Control   Purchase   Price  could,  pursuant   to   cross-default
provisions,  result  in  acceleration of  the  payment  of  other
indebtedness of the Company outstanding at that time. Payment  by
the   Company  of  the  Change  in  Control  Purchase  Price   is
subordinated  to  the  prior payment of  Senior  Indebtedness  as
described below under "Subordination of Exchange Debentures."

  The  Indenture does not give the Board authority to  waive  any
of  the  provisions  of the Indenture in the event  of  a  highly
leveraged  transaction. None of the Company's Senior Indebtedness
has a covenant that would afford the holders of such indebtedness
protection in the event of a change in control.

  In  accordance  with the Indenture, no Exchange Debentures  may
be  purchased if there has occurred and is continuing an Event of
Default  described  below under "Events  of  Default  and  Notice
Thereof."

<Page B-16>
SUBORDINATION OF EXCHANGE DEBENTURES

  The  Exchange  Debentures  will  be  subordinate  in  right  of
payment  to the extent set forth in the Indenture to all existing
and  future Senior Indebtedness (as defined in the Indenture)  of
the Company, whether outstanding on the date of the Indenture  or
thereafter  created,  incurred, assumed or guaranteed.  Upon  any
distribution of assets of the Company in any dissolution, winding
up,  liquidation or reorganization of the Company (whether in  an
insolvency  or  bankruptcy proceeding or otherwise),  payment  in
full  must be made on such Senior Indebtedness before any payment
is  made  on or in respect of the Exchange Debentures.  Upon  the
happening  and during the continuance of a default in payment  of
interest  on  or principal of Senior Indebtedness, or  any  other
default  with respect to such Senior Indebtedness permitting  the
holders  thereof to accelerate the maturity thereof,  no  payment
may  be  made  by  the Company on or in respect of  the  Exchange
Debentures. No such subordination will prevent the occurrence  of
any Event of Default (as defined in the Indenture).

  "Senior  Indebtedness"  means the  principal  of  and  interest
(including, without limitation, any interest accruing  subsequent
to the filing of a petition or other action concerning bankruptcy
or   other  similar  proceeding,  penalties,  reimbursements   or
indemnification amounts, fees, expenses or other amounts relating
to   any   indebtedness)  on  the  following,  whether  presently
outstanding  or hereafter incurred: (a) all indebtedness  of  the
Company (i) for money borrowed (other than that evidenced by  the
Exchange  Debentures),  (ii)  which  is  evidenced  by  a   note,
debenture  or  similar  instrument (including  a  purchase  money
mortgage)  given  in  connection  with  the  acquisition  of  any
property  or  assets  (other  than  inventory  or  other  similar
property  acquired in the ordinary course of business), including
securities,  or  (iii) for the payment of  money  relating  to  a
Capitalized  Lease  Obligation; (b)  any  liabilities  of  others
described  in  the  preceding clause (a) which  the  Company  has
guaranteed  or  which  is  otherwise  its  legal  liability;  (c)
indebtedness  of the Company under interest rate swaps,  caps  or
similar   hedging  agreements  and  foreign  exchange  contracts,
currency   swaps  or  similar  agreements;  and   (d)   renewals,
extensions,    refundings,   restructurings,    amendments    and
modifications   of   any   such   indebtedness   or    guarantee.
Notwithstanding anything to the contrary in the Indenture or  the
Exchange Debentures, "Senior Indebtedness" shall not include  (x)
any  indebtedness  of  the Company to a subsidiary,  or  (y)  any
indebtedness  or guarantee of the Company which by its  terms  or
the  terms  of the instrument creating or evidencing  it  is  not
superior in right of payment to the Exchange Debentures.

  At   March   31,   1997,  there  was  no  Senior   Indebtedness
outstanding.  Also, at that date, subsidiaries of the Company had
indebtedness  of approximately $2,868,000, to which the  Exchange
Debentures  are effectively subordinate. The Indenture  will  not
limit  the  amount  of additional indebtedness, including  Senior
Indebtedness,  which  the Company can create,  incur,  assume  or
guarantee,   nor  will  the  Indenture  limit   the   amount   of
indebtedness which any subsidiary can incur. As a result of these
subordination provisions, in the event of insolvency, holders  of
the Exchange Debentures may recover less ratably than holders  of
Senior Indebtedness and general creditors of the Company.
  
EVENTS OF DEFAULT AND NOTICE THEREOF

  The term "Event of Default" when used in the Indenture will
mean any one of the following: (i)  failure of the Company to pay
interest for 30 days or principal when due; (ii) failure of the
Company to  comply with any other covenant in the Indenture for
60 days after notice; (iii) default by the Company  with respect
to indebtedness aggregating more than $10,000,000, and the
acceleration of such  indebtedness under the terms of the
instruments evidencing such indebtedness or a default in any
payment when due at final maturity of any such indebtedness; and
(iv) certain events of bankruptcy or  reorganization of the
Company or any subsidiary.
  
<Page B-17>
  The  Indenture will provide that the Trustee shall,  within  90
days after the occurrence of any default  (the term "default"  to
include the events specified above without grace or notice) known
to it, give to the  holders of Exchange Debentures notice of such
default; provided that, except in the case of a default  in   the
payment  of  principal  of or interest on  any  of  the  Exchange
Debentures, the Trustee shall be protected  in the withholding of
such  notice  if it in good faith determines that the withholding
of  such  notice is in the  interest of the holders  of  Exchange
Debentures. The Indenture will require the Company to certify  to
the   Trustee annually as to whether any default occurred  during
such year.

  In  case  an  Event of Default (other than an Event of  Default
resulting  from bankruptcy, insolvency or  reorganization)  shall
occur  and be continuing, the Trustee or the holders of at  least
25%  in  aggregate   principal amount of the Exchange  Debentures
then  outstanding, by notice in writing to the Company  (and   to
the  Trustee if given by the holders of the Exchange Debentures),
may,  and  the Trustee shall, upon the  request of such  holders,
declare all unpaid principal and accrued interest on the Exchange
Debentures   then outstanding to be due and payable  immediately.
In  case  an Event of Default resulting from certain   events  of
bankruptcy, insolvency or reorganization shall occur, all  unpaid
principal  of  and  accrued interest  on the Exchange  Debentures
then outstanding shall be due and payable immediately without any
declaration  or  other  act on the part of  the  Trustee  or  the
holders  of  Exchange  Debentures.  Such   acceleration  may   be
annulled  and  past defaults may be waived by the  holders  of  a
majority  in  principal  amount of the Exchange  Debentures  then
outstanding, upon the conditions provided in the Indenture.

  The  Indenture  will  provide that no  holder  of  an  Exchange
Debenture  may pursue any remedy under  the Indenture unless  the
Trustee  shall  have failed to act after notice of  an  Event  of
Default  and  request  by holders of at least  25%  in  principal
amount  of  the Exchange Debentures and the offer to the  Trustee
of  indemnity  satisfactory to it; provided, however,  that  such
provision  does  not affect the right to sue for  enforcement  of
any overdue payment on the Exchange Debentures.

  The   holders  of  a  majority  in  principal  amount  of   all
outstanding  Exchange Debentures will have the  right  to  direct
the  time,  method  and place of conducting  any  proceeding  for
exercising  any  remedy  or   power  available  to  the  Trustee,
provided that such direction does not conflict with any  rule  of
law or with  the Indenture.

MODIFICATION AND WAIVER

   Modification and amendment of the Indenture may be made by the
Company and the Trustee with  the consent of the holders  of  not
less  than  a  majority in principal amount  of  the  outstanding
Exchange   Debentures,  provided that  no  such  modification  or
amendment  may,  without  the consent  of  the  holder  of   each
Exchange  Debenture affected thereby, (i) reduce  the  amount  of
Exchange  Debentures whose  holders must consent to an amendment,
supplement or waiver; (ii) reduce the rate of or change the  time
for  payment of interest on any Exchange Debenture; (iii)  reduce
the  principal of or change the fixed  maturity of  any  Exchange
Debenture  or  alter  the  redemption  provisions  with   respect
thereto;  (iv) modify  the conversion provisions with respect  to
any  Exchange  Debenture  in  a  manner  adverse  to  the  holder
thereof;  (v) waive a default in the payment of the principal  of
(and  premium,  if  any) or interest on any  Exchange  Debenture;
(vi)  make  any  changes  to  the  provisions  of  the  Indenture
governing  waiver  of  defaults and Events  of  Default  and  the
rights  of  holders to receive payment of the principal  of  (and
premium,  if  any) and interest on the Exchange Debenture;  (vii)
modify the Subordination provisions of  the Indenture in a manner
adverse to the holders of the Exchange Debenture; or (viii)  make
any   Exchange Debenture payable in money other than that  stated
in  the  Exchange Debentures. Holders of not less than a majority
in  principal amount of the outstanding Exchange  Debentures  may
waive  certain past defaults. See "Events of Default  and  Notice
Thereof." An  amendment to the Indenture may not adversely affect
the rights under the subordination provisions of the  holders  of
any  issue  of  Senior Indebtedness without the consent  of  such
holders.

SATISFACTION AND DISCHARGE

  The  Indenture will be discharged and canceled upon payment  of
all  the Exchange Debentures. The  Company may terminate  all  of
its obligations under the Indenture, other than its obligation to
pay the  principal of and interest on the Exchange Debentures and
certain  other obligations (including its obligation  to  deliver
shares  of  Common Stock upon conversion of Exchange Debentures),
at  any  time, by  depositing with the Trustee or a paying  agent
other  than  the  Company, money or noncallable U.S.   Government
Obligations (as defined in the Indenture) sufficient to  pay  all
remaining indebtedness on the  Exchange Debentures.

<Page B-18>
MERGER AND CONSOLIDATION

  The   Company   may  consolidate  or  merge  with   any   other
corporation and the Company may transfer  its property and assets
substantially  as an entirety to any persons; provided  that  (i)
the  Company is the  resulting or surviving corporation,  or  the
successor  corporation is a domestic corporation and it  assumes,
by  supplemental  indenture, payment  of  the  principal  of  and
interest   on  the  Exchange  Debentures  and   performance   and
observance  of  every  covenant  of  the  Indenture,   and   (ii)
immediately before and  immediately after giving effect  to  such
transaction,  no default or Event of Default shall have  occurred
and   be  continuing. Thereafter, all obligations of the  Company
under the Indenture and the Exchange  Debentures will terminate.

CONCERNING THE TRUSTEE

  Fidelity   Bank,  National  Association,  a  national   banking
association,  will  be  the  Trustee under  the   Indenture.  The
Indenture will contain certain limitations on the rights  of  the
Trustee,  should it become a  creditor of the Company, to  obtain
payment  of  claims  in certain cases, or to realize  on  certain
property   received in respect of any such claim as  security  or
otherwise.  The  Trustee will be permitted to  engage  in   other
transactions;  provided, however, if it acquires any  conflicting
interest (as defined) and there exists a  default with respect to
the  Exchange  Debentures,  it must eliminate  such  conflict  or
resign.

     In case an Event of Default shall occur (and shall not be
cured) and holders have notified the  Trustee, the Trustee will
be required to exercise its powers with the degree of care and
skill of a prudent  person in the conduct of his own affairs.
Subject to such provisions, the Trustee will be under no
obligation to exercise any of its rights or powers under the
Indenture at the request of any of the holders  of Exchange
Debentures, unless they shall have offered to the Trustee
security and indemnity  satisfactory to it.


                           *    *    *
     This document constitutes part of a prospectus covering
         securities that have been registered under the
                     Securities Act of 1933.


<Page II-1>
PART  I - INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS


          The documents containing the information specified in Part I
of this Registration Statement will be given or sent to all employees
who participate in the Westmoreland Coal Company and Affiliated
Companies' Employees' Savings/Retirement Plan (the "Plan") as
specified by Rule 428.


PART II - INFORMATION REQUIRED IN THE REGISTRATION STATEMENT


ITEM 3.   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.

          The following documents filed with the Securities and
Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") by Westmoreland Coal Company
(the "Company") (File No. 0-752) are incorporated herein by reference:

                    (i)  the Company's Annual Report on Form 10-K for
                 the fiscal year ended December 31, 1996;

                    (ii) the description of the Company's Common Stock
                 contained in its Registration Statement on Form 8-A,
                 filed May 22, 1992; and

                    (vi) the description of the Company's Depository
                 Shares contained in its Registration Statement on
                 Form 8-A, filed June 23, 1992.

          Each document filed by the Company after the date hereof
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
prior to the filing of a post-effective amendment which indicates that
all securities offered hereby have been sold or which deregisters all
securities remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and shall be part hereof from
the date of filing of such document.


ITEM 4.   DESCRIPTION OF SECURITIES.

          Not applicable.


ITEM 5.   INTERESTS OF NAMED EXPERTS AND COUNSEL.

          Paul W. Durham, Esquire, the named counsel who prepared the
opinion attached as Exhibit 5.1, is connected with the registrant by
virtue of his position as Assistant General Counsel and Assistant
Secretary of the Company.


<Page II-2>
ITEM 6.   INDEMNIFICATION OF DIRECTORS AND OFFICERS.

          Section 145 of Delaware's General Corporation Law authorizes
a corporation to indemnify any present or former director or officer
against certain lawsuits brought by reason of the fact that the person
is or was a director or officer of the corporation.  This language is
sufficiently broad that in certain circumstances, it could permit
indemnification for liabilities and expenses incurred arising under
the Securities Act of 1933, as amended.  Further, the statute creates
a right of indemnification if the director or officer is successful on
the merits or otherwise in defense of any action for which the
corporation may indemnify the director or officer.

          Article V of the Company's By-Laws provide that the Company
shall indemnify its directors and officers for any expenses including
attorney's fees, judgments and other amounts incurred in connection
with a suit, action or proceeding brought by reason of the fact that
he or she is or was a director or officer.  The terms of the
indemnification provisions in the Company's By-Laws are substantially
similar to the provisions of Section 145 of Delaware's General
Corporation Law.  The Company maintains and pays all premiums on a
liability policy for its liability and that of its directors and
officers and those of its subsidiaries.


ITEM 7.  EXEMPTION FROM REGISTRATION CLAIMED.

          Not applicable.


ITEM 8.  EXHIBITS.

          4.1    Certificate of Designation of Series A Convertible
          Exchangeable Preferred Stock of the Company defining the
          rights of holders of such stock, filed July 8, 1992 as an
          amendment to the Company's Certificate of Incorporation, and
          filed as Exhibit 3(a) to the Company's Form 10-K for 1992,
          which Exhibit is incorporated herein by reference;

          4.2    Form of Deposit Agreement among the Company, First
          Chicago Trust Company of New York, as Depository, and the
          holders from time to time of the Depository Receipts, filed
          as Exhibit 4.3 to Form S-2, Registration No. 33-47872 filed
          May 13, 1992, and Amendments 1 through 4 thereto, which
          Exhibit is incorporated herein by reference;

          4.3    Specimen certificate representing the common stock of
          the Company, filed as Exhibit 4(c) to the Company's
          Registration Statement on Form S-2, Registration No.
          33-1950, filed December 4, 1985, which Exhibit is
          incorporated herein by reference;

          4.4    Specimen certificate representing the Preferred
          Stock, filed as Exhibit 4.6 to the Company's Registration
          Statement on Form S-2, Registration No. 33-47872, filed May
          13, 1992, and Amendments 1 through 4 thereto, which Exhibit
          is incorporated herein by reference; and

          4.5    Form of Depository Receipt, filed as Exhibit 4.7 to
          the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

          4.6    Form of Exchange Indenture, filed as Exhibit 4.2 to
          the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments, 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

          5.1    Opinion of Paul W. Durham, Esquire

          23.1   Consent of KPMG Peat Marwick LLP

          24.1   Power of Attorney (included on signature page)

          99.1   Westmoreland Coal Company and Affiliated Companies
          Employees' Savings/Retirement Plan


ITEM 9.  UNDERTAKINGS.

          The undersigned registrant hereby undertakes:

     (1)  To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:

     (i)  To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;

     (ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) that, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement.  Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;

     (iii)  To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;

          Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the registration statement is on Form S-3 or Form S-8,
and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
the registration statement.

<Page II-4>
     (2)  That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

     (3)  To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.

          The registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Securities Exchange Act of 1934) that
is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

          Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable.  In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.

<Page II-5>
                              SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Colorado Springs, Colorado
on July 30, 1997.

                                   Westmoreland Coal Company


                                   By   /s/ Robert J. Jaeger
                                        --------------------------
                                        Robert J. Jaeger
                                        Senior Vice President of
                                        Finance, Treasurer and
                                        Controller


     Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.

     Each person whose signature appears below in so signing also
makes, constitutes and appoints Theodore E. Worcester and Paul W.
Durham and each of them, his true and lawful attorney-in-fact, with
full power of substitution, for him in any and all capacities, to
execute and cause to be filed with the Securities and Exchange
Commission any and all amendments and post-effective amendments to
this Registration Statement, with exhibits thereto and other documents
in connection therewith, and hereby ratifies and confirms all that
said attorney-in-fact or his substitute or substitutes may do or cause
to be done by virtue hereof.


Signature                      Title                              Date

                              Chairman of the Board,
/s/ Christopher K. Seglem     President and Cheif              July 30, 1997
---------------------------   Executive Officer
Christopher K. Seglem         (principal executive officer)


                              Senior Vice President
/s/ Robert J. Jaeger          of Finance, Treasurer            July 30, 1997 
----------------------        and Controller
Robert J. Jaeger             (principal financial and
                              accounting officer)





Directors:



/s/ Pemberton Hutchinson      Director                         July 28, 1997
-------------------------
Pemberton Hutchinson


/s/ Robert E. Killen          Director                         July 28, 1997
-------------------------
Robert E. Killen


/s/ William R. Klaus          Director                         July 28, 1997
-------------------------
William R. Klaus


/s/ Thomas W. Ostrander       Director                         July 28, 1997
-------------------------
Thomas W. Ostrander


/s/ James W. Sight            Director                         July 28, 1997
-------------------------
James W. Sight


/s/ Edwin E. Tuttle           Director                         July 28, 1997
-------------------------
Edwin E. Tuttle




     Pursuant to the requirements of the Securities Act of 1933,
the trustees (or other persons who administer the employee
benefit plan) have duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in Colorado Springs, Colorado on July 30, 1997.


                         Westmoreland Coal
                         Company and Affiliated Companies
                         Employees' Savings/Retirement Plan

                         
                         By:  Westmoreland Coal Company
                              Savings/Retirement Plan
                              Administrative Committee

 
                              By:  /s/ Cheryl M. Sprague
                                   ----------------------
                                   Cheryl M. Sprague

<Page II-1>
                          EXHIBIT INDEX

  Exhibit

   Number              Description                        Page


     4.1  Certificate of Designation of Series A Convertible
          Exchangeable Preferred Stock of the Company defining
          the rights of holders of such stock, filed July 8, 1992
          as an amendment to the Company's Certificate of
          Incorporation, and filed as Exhibit 3(a) to the
          Company's Form 10-K for 1992, which Exhibit is
          incorporated herein by reference;

     4.2  Form of Deposit Agreement among the Company, First
          Chicago Trust Company of New York, as Depository, and
          the holders from time to time of the Depository
          Receipts, filed as Exhibit 4.3 to Form S-2,
          Registration No. 33-47872 filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference;

     4.3  Specimen certificate representing the common stock
          of the Company, filed as Exhibit 4(c) to the Company's
          Registration Statement on Form S-2, Registration No.
          33-1950, filed December 4, 1985, which Exhibit is
          incorporated herein by reference;

     4.4  Specimen certificate representing the Preferred
          Stock, filed as Exhibit 4.6 to the Company's
          Registration Statement on Form S-2, Registration No.
          33-47872, filed May 13, 1992, and Amendments 1 through
          4 thereto, which Exhibit is incorporated herein by
          reference; and

     4.5  Form of Depository Receipt, filed as Exhibit 4.7
          to the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

     4.6  Form of Exchange Indenture, filed as Exhibit 4.2
          to the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments, 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

     5.1  Opinion of Paul W. Durham, Esquire

     23.1 Consent of KPMG Peat Marwick LLP

     24.1 Power of Attorney (included on signature page)

     99.1 Westmoreland Coal Company and Affiliated Companies
          Employees' Savings/Retirement Plan




<PAGE>
Exhibit 5.1
                                   July 30, 1997



Board of Directors
Westmoreland Coal Company
2 North Cascade Avenue
Colorado Springs, CO 80903

Gentlemen:

          This opinion is provided to Westmoreland Coal Company,
a Delaware corporation (the "Company"), in connection with its
registration statement on Form S-8 (the "Registration Statement")
filed with the Securities and Exchange Commission relating to the
proposed purchase and sale pursuant to the terms of the
Westmoreland Coal Company And Affiliated Companies Employees'
Savings/Retirement Plan (the "Plan") of up to 325,000 shares of
the Company's common stock, par value $2.50 per share and up to
7,000 shares of the Company's Depositary Shares.  This opinion
letter is furnished to you at your request to enable you to
fulfill the requirements of Item 601(b)(5) of Regulation S-K,
17 C.F.R. Section 229.601(b)(5), in connection with the Registration
Statement.

          For purposes of this opinion letter, I have examined
copies of documents deemed necessary for this opinion, and in my
examination of such documents, have assumed the genuineness of
all signatures, the legal capacity of natural persons, the
authenticity, accuracy and completeness of all such documents,
and the conformity with the original documents of all documents
submitted to me as certified, telecopied, photostatic, or
reproduced copies.  This opinion letter is given, and all
statements herein are made, in the context of the foregoing.

          This opinion letter is based as to matters of law
solely on the General Corporation Law of the State of Delaware.
I express no opinion herein as to any other laws, statutes,
regulations, or ordinances.

          Based upon, subject to and limited by the foregoing, I
am of the opinion that the Shares are validly issued, fully paid
and nonassessable under the General Corporation Law of the State
of Delaware.  A copy of the Internal Revenue Service
determination letter that the Plan is qualified under Section 401
of the Internal Revenue Code is attached hereto.

<PAGE>
          I assume no obligation to advise you of any changes in
the foregoing subsequent to the delivery of this opinion letter.
This opinion letter has been prepared solely for your use in
connection with the filing of the Registration Statement on the
date of this opinion letter and should not be quoted in whole or
in part or otherwise be referred to, nor filed with or furnished
to any governmental agency or other person or entity, without the
prior written consent of this firm.

          I hereby consent to the filing of this opinion letter
as Exhibit 5.1 to the Registration Statement.  In giving this
consent, I do not thereby admit that I am an "expert" within the
meaning of the Securities Act of 1933, as amended.

          
          
                              Very truly yours,
                              /s/ Paul W. Durham
                              --------------------------
                              Paul W. Durham
                              Assistant General Counsel
                              Westmoreland Coal Company


<PAGE>
INTERNAL REVENUE SERVICE           DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
31 HOPKINS PLAZA
BALTIMORE, MD 21201-0000

Date: Feb 02 1996

WESTMORELAND RESOURCES, INC.
C/O ANDREW J. RUDOLPH, ESQUIRE
BALLARD SPAHR ANDREWS & INGERSOLL
1735 MARKET STREET, 51ST FLOOR
PHILADELPHIA, PA 19103-7599

Employer Identification Number:    81-0364990
File Folder Number: 521054602
Person to Contact:  AUDREY PETIT
Contact Telephone Number:     (215) 597-8958
Plan Name:     WESTMORELAND COAL COMPANY AND AFFILIATED COMPANIES
EMPLOYEES SAV
Plan Number:   001


Dear Applicant:

     We have made a favorable determination on your plan,
identified above, based on the information supplied.  Please keep
this letter in your permanent records.

     Continued qualification of the plan under its present form
will depend on its effect in operation.  (See section 1.401-
1(b)(3) of the Income Tax Regulations.)  We will review the
status of the plan in operation periodically.

     The enclosed document explains the significance of this
favorable determination letter, points out some features that may
affect the qualified status of your employee retirement plan, and
provides information on the reporting requirements for your plan.
It also describes some events that automatically nullify it.  It
is very important that you read the publication.

     This letter relates only to the status of your plan under
the Internal Revenue Code.  It is not a determination regarding
the effect of other federal or local statues.

     This determination is subject to your adoption of the
proposed amendments submitted in your letter dated 8/31/95 and
11/2/95.  The proposed amendments should be adopted on or before
the date prescribed by the regulations under code section 401(b).

     This plan has been mandatorily disaggregated, permissively
aggregated, or restructured to satisfy the nondiscrimination
requirements.

     This letter is issued under Rev. Proc. 93-39 and considers
the amendments required by the Tax Reform Act of 19867 except as
otherwise specified in this letter.

     This plan satisfies the nondiscriminatory current
availability requirements of section 1.401(a)(4)-(4)(b) of the
regulations with respect to those benefits, rights, and features
that are currently available to all employees in the plan's
coverage group.  For this purpose, the plan's coverage group
consists of those employees treated as currently benefiting for
purposes of demonstrating that the plan satisfies the minimum
coverage requirements of section 410(b) of the Code.

<PAGE>
     This leter may not be relied upon with respect to whether
the plan satisfies the qualification requirements as amended by
the Uruguay Round Agreements Act, Pub. L. 103-465.

     We have sent a copy of this letter to your representative as
indicated in the power of attorney.

     If you have questions concerning this matter, please contact
the person whose name and telephone number are shown above.

                              Sincerely yours,

                              /s/ Paul M. Hunsington
                              District Director

Enclosure(s)
Publication 794


<PAGE>
Exhibit 23.1

                 CONSENT OF INDEPENDENT AUDITORS
                                

The Board of Directors
Westmoreland Coal Company:

We consent to the incorporation by reference in the registration
statement on Form S-8 of Westmoreland Coal Company of our report
dated March 17, 1997, relating to the consolidated balance sheets
of Westmoreland Coal Company and subsidiaries as of December 31,
1996 and 1995, and the related consolidated statements of
opertaions, shareholders' equity (deficit), and cash flows for
each of the years in the three-year period ended December 31,
1996, which report appears in the December 31, 1996 annual report
on Form 10-K of Westmoreland Coal Company.

Our report dated March 17, 1997 contains an explanatory paragraph
that states that the Company's bankruptcy filing under Chapter 11
of the United States Bankruptcy Code raises substantial doubt
about its ability to continue as a going concern.  The
consolidated financial statements do not include any adjustments
that might result from the outcome of that uncertainty.


                              KPMG Peat Marwick LLP

Denver, Colorado
July 25, 1997



<PAGE>
Exhibit 99.1

                   WESTMORELAND COAL COMPANY

                              AND

    AFFILIATED COMPANIES EMPLOYEES' SAVINGS/RETIREMENT PLAN


                      AMENDED AND RESTATED

                  EFFECTIVE SEPTEMBER 1, 1987


                       TABLE OF CONTENTS
                                                             PAGE

     ARTICLE I

                          DEFINITIONS

"Account"                                                       2
     "Matching Contribution Account"                            2
     "Pre-1994 Matching Contribution Subaccount"                2
     "Post-1993 Matching Contribution Subaccount"               2
     "Rollover Account"                                         3
     "Salary Reduction Account"                                 3
     "Pre-1990 Salary Reduction Subaccount"                     3
     "Post-1989 Salary Reduction Subaccount"                    3
     "Voluntary Contribution Account"                           4
"Active Participant"                                            4
"Actual Deferral Percentage"                                    4
"Affiliated Company"                                            4
"Age"                                                           5
"Age 55 Shares"                                                 5
"Alternate Payee"                                               6
"Average Actual Deferral Percentage"                            6
"Average Contribution Percentage"                               6
"Benefit Commencement Date"                                     6
"Board of Directors"                                            6
"Code"                                                          6
"Committee"                                                     7
"Company"                                                       7
"Company Stock"                                                 7
"Compensation"                                                  7
"Covered Employee"                                             10
"Effective Date"                                               11
"Eligible Employee"                                            11
"Employee"                                                     11
"Employment Commencement Date"                                 11
"ERISA"                                                        11
"Fixed Income Fund"                                            11
"Fund"                                                         12
"Highly Compensated Eligible Employee"                         12
"Highly Compensated Employee"                                  12
"Hour of Service"                                              14
"Investment Medium"                                            16
"Limitation Year"                                              16
"Matching Contributions"                                       16
"Normal Retirement Age"                                        16
"Normal Retirement Date"                                       16
"Participant"                                                  16
"Participating Company"                                        17
"Payroll Period"                                               17
"Plan"                                                         17
"Plan Year"                                                    17
"Post-1989 Rollover Contributions"                             17
"Post-1993 Matching Contributions"                             17
"Post-1989 Salary Reduction Contributions"                     17
"Pre-1994 Matching Contributions"                              18
"Pre-1990 Rollover Contributions"                              18
"Pre-1990 Salary Reduction Contributions"                      18
"Qualified Domestic Relations Order"                           18
"Quarterly Status Date"                                        18
"Required Beginning Date"                                      18
"Rollover Contributions"                                       19
"Salary Reduction Contributions"                               19
"Separation from Service"                                      20
"Spouse"                                                       20
"Total Disability"                                             20
"Trust Agreement"                                              20
"Trustee"                                                      21
"Valuation Date"                                               21
"Voluntary Contributions"                                      21

     ARTICLE II

           TRANSITION AND ELIGIBILITY TO PARTICIPATE

2.1    Rights Affected and Preservation of Accrued Benefit     22
2.2    Eligibility to Participate - Salary Reduction
       Contributions                                           22
2.3    Election to Make Salary Reduction Contributions         23
2.4    Participation in Matching Contributions                 23
2.5    Data                                                    23

     ARTICLE III

                   CONTRIBUTIONS TO THE PLAN

3.1    Salary Reduction Contributions                          25
3.2    Change of Percentage Rate                               26
3.3    Discontinuance of Salary Reduction Contributions        27
3.4    Matching Contribution                                   28
3.5    Timing and Deductibility of Contributions               30
3.6    Fund                                                    31
3.7    Limitation on Salary Reduction Contributions and
       Matching Contributions                                  31
3.8    Prevention of Violation of Limitation on Salary
       Reduction Contributions and Matching Contributions      35
3.9    Maximum Allocation                                      40





                           ARTICLE IV

                     PARTICIPANTS' ACCOUNTS

4.1    Accounts                                                46
4.2    Valuation                                               46
4.3    Apportionment of Gain or Loss                           46
4.4    Accounting for Allocations                              47
4.5    Statement of Account.                                   47

     ARTICLE V

                          DISTRIBUTION

5.1    General                                                 48
5.2    Separation from Service                                 48
5.3    Death                                                   48
5.4    Total Disability                                        48
5.5    Valuation for Distribution                              49
5.6    Timing of Distribution                                  50
5.7    Mode of Distribution                                    52
5.8    Beneficiary Designation                                 54
5.9    Transfer of Account to Other Plan                       56
5.10   Sale of Company Stock Upon Distribution.                59

     ARTICLE VI

                            VESTING

6.1    Nonforfeitable Amounts                                  60

     ARTICLE VII

              PURCHASE AND VOTING OF COMPANY STOCK

7.1    Purchase of Company Stock                               61
7.2    Participant Voting Direction                            61
7.3    Voting Procedures                                       62
7.4    Absence of Participant Voting Direction                 62

     ARTICLE VIII

                           WITHDRAWALS

8.1    Withdrawals Not Subject to Section 401(k)
       Restrictions.                                           63
8.2    Withdrawals Subject to Section 401(k) Restrictions      64
8.3    Withdrawals On and After Attainment of Age 59-1/2       67
8.4    Amount and Payment of Withdrawals                       67
8.5    Pledged Amounts                                         67
8.6    Investment Medium to be Charged with Withdrawal         68

     ARTICLE IX

                     LOANS TO PARTICIPANTS

9.1    Loan Application                                        69
9.2    Loan Approval                                           69
9.3    Amount of Loan                                          69
9.4    Terms of Loan                                           70
9.5    Enforcement                                             73
9.6    Investment Medium to be charged with Loan               74
9.7    Additional Rules                                        75

     ARTICLE X

                         ADMINISTRATION

10.1   Committee                                               76
10.2   Duties and Powers of Committee                          76
10.3   Functioning of Committee                                78
10.4   Disputes                                                78
10.5   Indemnification                                         79

     ARTICLE XI

                            THE FUND

11.1   Designation of Trustee                                  81
11.2   Exclusive Benefit                                       81
11.3   No Interest in Fund                                     81
11.4   Trustee                                                 81

     ARTICLE XII

                          INVESTMENTS

12.1   Investment of Pre-1994 Matching Contributions,
       Voluntary Contributions, Pre-1990 Salary Reduction
       Contributions and Pre-1990 Rollover Contributions       83
12.2   Investment of Post-1989 Salary Reduction Contributions,
       Post-1989 Rollover Contributions and Post-1993 Matching
       Contributions                                           85
12.3   Investment Media.                                       87
12.4   Additional Rules                                        87

     ARTICLE XIII

              AMENDMENT OR TERMINATION OF THE PLAN

13.1   Power of Amendment and Termination                      89
13.2   Merger                                                  90

     ARTICLE XIV

                      TOP-HEAVY PROVISIONS

14.1   General                                                 91
14.2   Definitions                                             91
14.3   Minimum Contribution for Non-Key Employees              97
14.4   Social Security                                         98
14.5   Adjustment to Maximum Benefit Limitation                98

     ARTICLE XV

                     ROLLOVER CONTRIBUTIONS

15.1   Rollover Contributions.                                101
15.2   Vesting and Distribution of Rollover Account           102

     ARTICLE XVI

                       GENERAL PROVISIONS

16.1   No Employment Rights                                   103
16.2   Governing Law                                          103
16.3   Severability of Provisions                             103
16.4   No Interest in Fund                                    103
16.5   Spendthrift Clause                                     104
16.6   Incapacity                                             104
16.7   Withholding                                            104
16.8   Missing Persons                                        105



          WHEREAS, Westmoreland Coal Company (the "Company")

adopted the Westmoreland Coal Company and Affiliated Companies

Employees' Stock Purchase Plan, effective October 1, 1957, for

certain of its Employees and the Employees of any Participating

Companies; and

          WHEREAS, the Company amended and restated the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, effective June 1, 1984; and

          WHEREAS, the Company desires to amend and restate the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan to comply with the requirements of the

Employee Retirement Income Security Act of 1974 and with the

Internal Revenue Code of 1986, as amended; and

          WHEREAS, the Company desires to rename the Westmoreland

Coal Company and Affiliated Companies Employees' Stock Purchase

Plan, effective March 1, 1990;

          NOW, THEREFORE, effective September 1, 1987, the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan is continued, amended and restated as

hereinafter set forth and, effective March 1, 1990, renamed the

Westmoreland Coal Company and Affiliated Companies Employees'

Savings/Retirement Plan:

                           ARTICLE I

                          DEFINITIONS


          Except where otherwise clearly indicated by context,

the masculine shall include the feminine and the singular shall

include the plural, and vice-versa.  Any term used herein without

an initial capital letter that is used in a provision of the Code

with which this Plan must comply to meet the requirements of

section 401(a) of the Code shall be interpreted as having the

meaning used in such provision of the Code, if necessary for the

Plan to comply with such provision.

          "Account" means the entries maintained in the records

of the Trustee which represent the Participant's interest in the

Fund.  The term "Account" shall refer, as the context indicates,

to any or all of the following:

               "Matching Contribution Account" -- the Account

which consists of the following two Subaccounts:

               (a)  "Pre-1994 Matching Contribution Subaccount"

--- the subaccount to which are credited Pre-1994 Matching

Contributions, and all other contributions made by a

Participating Company prior to June 1, 1984, allocated to a

Participant, adjustments for withdrawals and distributions, and

the earnings, losses and expenses attributable thereto; and

               (b)  "Post-1993 Matching Contribution Subaccount"

--- the subaccount to which are credited Post-1993 Matching

Contributions, allocated to a Participant, adjustments for

withdrawals and distributions, and the earnings, losses and

expenses attributable thereto.

               "Rollover Account" -- the Account which consists

of the following two Subaccounts:

               (a)  "Pre-1990 Rollover Subaccount" --- the

subaccount to which are credited a Participant's Pre-1990

Rollover Contributions that are not subject to the joint and

survivor annuity requirements of sections 401(a)(11) and 417 of

the Code, adjustments for withdrawals and distributions, and the

earnings, losses and expenses attributable thereto; and

               (b)  "Post-1989 Rollover Subaccount" --- the

subaccount to which are credited a Participant's Post-1989

Rollover Contributions that are not subject to the joint and

survivor annuity requirements of sections 401(a)(11) and 417 of

the Code, adjustments for withdrawals and distributions, and the

earnings, losses and expenses attributable thereto.

               "Salary Reduction Account" -- the Account which

consists of the following two Subaccounts:

               (a)  "Pre-1990 Salary Reduction Subaccount" ---

the subaccount to which are credited a Participant's Pre-1990

Salary Reduction Contributions, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto; and

               (b)  "Post-1989 Salary Reduction Subaccount" ---

the subaccount to which are credited a Participant's Post-1989

Salary Reduction Contributions, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto.

               "Voluntary Contribution Account" -- the Account to

which are credited a Participant's Voluntary Contributions made

prior to June 1, 1984, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto.

          "Active Participant" means an individual who has become

an Active Participant as provided in Article II and has remained

a Covered Employee at all times thereafter.

          "Actual Deferral Percentage" means, for any Eligible

Employee for a given Plan Year, the ratio of:

               (a)  the sum of:

                    (1)  such Eligible Employee's Salary

Reduction Contributions for the Plan Year, plus

                    (2)  in the case of any Highly Compensated

Eligible Employee, his elective deferrals for the year under any

other qualified retirement plan, other than an employee stock

ownership plan as defined in section 4975(e)(7) of the Code or a

tax credit employee stock ownership plan as defined in section

409(a) of the Code, maintained by the Participating Company or

any Affiliated Company; to

               (b)  the Eligible Employee's Compensation for the

Plan Year or the calendar year ending within the Plan Year.

          "Affiliated Company" means, with respect to any

Participating Company, (a) any corporation that is a member of a

controlled group of corporations, as determined under section

414(b) of the Code, which includes such Participating Company;

(b) any member of an affiliated service group, as determined

under section 414(m) of the Code, of which such Participating

Company is a member; (c) any trade or business (whether or not

incorporated) that is under common control with such

Participating Company, as determined under section 414(c) of the

Code; and (d) any other organization or entity which is required

to be aggregated with the Participating Company under section

414(o) of the Code and regulations issued thereunder.  "50%

Affiliated Company" means an Affiliated Company, but determined

with "more than 50%" substituted for the phrase "at least 80%" in

section 1563(a) of the Code, when applying sections 414(b) and

(c) of the Code.

          "Age" means, for any individual, his age on his last

birthday, except that an individual attains Age 59-1/2 or Age

70-1/2 on the corresponding date in the sixth calendar month

following the month in which his 59th or 70th (respectively)

birthday falls (or the last day of such sixth month if there is

no such corresponding date therein).

          "Age 55 Shares" means, with respect to any Participant,

the Company Stock allocated to his Pre-1994 Matching Contribution

Subaccount, Voluntary Contribution Account, and Pre-1990 Salary

Reduction Subaccount as of the later of (a) the Quarterly Status

Date coincident with or next following the date the Participant

attains Age 55 or (b) June 30, 1976, plus any Company Stock

allocated to such Account and Subaccounts after such date.

          "Alternate Payee" shall mean any Spouse, former Spouse,

child or other dependent of a Participant who is recognized by a

domestic relations order (within the meaning of

section 414(p)(1)(B) of the Code) as having a right to receive

all, or a portion of, the benefits payable under the Plan with

respect to such Participant.

          "Average Actual Deferral Percentage" means, for a

specified group of Eligible Employees for a Plan Year, the

average of the Actual Deferral Percentages for such Eligible

Employees for the Plan Year.

          "Average Contribution Percentage" means, for a

specified group of Eligible Employees for a Plan Year, the

average of the Contribution Percentages for such Eligible

Employees for the Plan Year.

          "Benefit Commencement Date" means, for any Participant

or beneficiary, the date as of which the first benefit payment,

including a single sum, from the Participant's Account is due,

other than pursuant to a withdrawal under Article VIII.

          "Board of Directors" means the board of directors (or

other governing body) of the Company.

          "Code" means the Internal Revenue Code of 1986, as

amended, and any regulations issued thereunder.

          "Committee" means the individuals appointed by the

Board of Directors (if any) or by the Company to supervise the

administration of the Plan, as provided in Article X.

          "Company" means Westmoreland Coal Company, and its

successors.

          "Company Stock" means:

               (a)  prior to March 1, 1993, shares of common

stock of the Company; and

               (b)  after February 28, 1993, shares of common

stock or preferred stock (the latter represented by and held in

the form of depository shares) of the Company.

          "Compensation" means, for any Eligible Employee, for

any applicable period:

               (a)  For purposes of Sections 3.1 and 3.4, subject

to the limitations set forth in Subsection (e) of this

definition, his base monthly rate of pay from a Participating

Company (including Salary Reduction Contributions and salary

deferrals under a plan described in section 125 of the Code).

Compensation shall not include bonuses, commissions, other

incentive or special payments, overtime pay, all amounts

identified by a Participating Company as expense allowances or

reimbursements, and all Matching Contributions, or any

contributions made by a Participating Company under any other

employee pension benefit or welfare benefit plan to which the

Participating Company contributes on behalf of the Employee. 

               (b)  for the purposes of Article XIV and Section 3.9,

subject to the limitations set forth in Subsection (e) of this

definition, the Employee's "compensation" as such word is

defined in Treas. Reg. Section 1.415-2(d)(10).

               (c)  for the purposes of the definitions of

"Actual Deferral Percentage" and "Contribution Percentage" in

this Article (except as otherwise provided in such definitions,

and subject to the limitations set forth in Subsection (e) of

this definition, the Employee's "compensation" as such word is

defined in Treas. Reg. Section 1.415-2(d)(10) provided that, in the sole

discretion of the Committee, Compensation may include:

                    (1)  Salary Reduction Contributions and other

amounts excluded from gross income under section 125, 402(a)(8),

402(h) or 403(b) of the Code; and

                    (2)  compensation deferred under an eligible

deferred compensation plan within the meaning of section 457(b)

of the Code; and

                    (3)  employee contributions described in

section 414(h)(2) that are picked up by the employing unit and

thus are treated as employer contributions.

          For the purpose of this Subsection (c), the Company may

elect to consider only compensation as defined above for that

portion of the Plan Year or the calendar year ending within the

Plan Year during which the Employee was an Eligible Employee,

provided that this election is applied uniformly to all Eligible

Employees for the Plan Year.

               (d)  for the purpose of the definition of "Highly

Compensated Employee" in this Article (except as otherwise

provided in such definition), the Employee's "compensation" as

such word is defined in Treas. Reg. Section 1.415-2(d)(10) but including

amounts that are excluded from gross income under section 125,

402(a)(8), 402(h) or 403(b) of the Code.

               (e)  effective September 1, 1989, with respect to

any Plan Year, only compensation not in excess of the amount to

which the dollar limit of Code section 401(a)(17), as amended,

has been indexed shall be taken into account for purposes of

Subsections (a), (b) and (c) of this definition, except that this

Subsection (e) shall not apply for purposes of Section 3.9.  In

determining Compensation for purposes of this limitation, the

rules of section 414(q)(6) of the Code shall apply, except in

applying such rules, the term "family" shall include only the

spouse of the Employee and any lineal descendants who have not

attained Age 19 before the close of the Plan Year.  In applying

the rules of section 414(q)(6) of the Code, the limit of this

Subsection (e) shall be allocated among family members in

proportion to their Compensation as defined in Subsection (a)

without regard to this Subsection (e).

          "Contribution Percentage" means for any Eligible

Employee for a given Plan Year, the ratio of:

               (a)  the sum of

                    (1)  such Eligible Employee's Matching

Contributions for the Plan Year (to the extent not included in

such Eligible Employee's Actual Deferral Percentage for such Plan

Year), plus

                    (2)  in the case of any Highly Compensated

Eligible Employee, any employee contributions and employer

matching contributions, including any elective deferrals

recharacterized as employee contributions, under any other

qualified retirement plan, other than an employee stock ownership

plan as defined in section 4975(e)(7) of the Code or a tax credit

employee stock ownership plan as defined in section 409(a) of the

Code, maintained by the Participating Company or any Affiliated

Company, plus

                    (3)  at the election of the Committee, any

portion of the Eligible Employee's Salary Reduction Contributions

for the Plan Year or elective deferrals under any other qualified

retirement plan maintained by a Participating Company or any

Affiliated Company that may be disregarded without causing this

Plan or such other qualified retirement plan to fail to satisfy

the requirements of section 401(k)(3) of the Code and the

regulations issued thereunder; to

               (b)  The Eligible Employee's Compensation for the

Plan Year or the calendar year ending within the Plan Year.

          "Covered Employee" means any Employee who (a) is

employed by a Participating Company, and (b) is not covered by a

collective bargaining agreement, unless such agreement

specifically provides for participation hereunder.  An Employee

who is such solely by reason of being a leased employee shall not

be a Covered Employee.

          "Effective Date" means September 1, 1987, the effective

date of this amended and restated Plan.

          "Eligible Employee" means an Employee who has become an

Eligible Employee as set forth in Section 2.2, and who has

remained a Covered Employee at all times thereafter.

          "Employee" means an individual who is employed by a

Participating Company or an Affiliated Company.  An individual

who is not otherwise employed by a Participating Company or

Affiliated Company shall be deemed to be employed by such Company

if he is a leased employee with respect to whose services such

Participating Company or Affiliated Company is the recipient

within the meaning of Code section 414(n) or 414(o), but to whom

Code section 414(n)(5) does not apply.

          "Employment Commencement Date" means, for any Employee,

the date on which he is first entitled to be credited with an

"Hour of Service" described in Paragraph (a)(1) of the definition

of Hour of Service in this Article.

          "ERISA" means the Employee Retirement Income Security

Act of 1974, as amended.

          "Fixed Income Fund" means a separate fund maintained by

the Trustee prior to March 1, 1990 which provides a fixed rate of

income on amounts transferred by Participants pursuant to Section

12.1.

          "Fund" means the fund established for this Plan,

administered under the Trust Agreement, out of which benefits

payable under this Plan shall be paid.

          "Highly Compensated Eligible Employee" means an

Eligible Employee who is (or is treated as) a Highly Compensated

Employee.

          "Highly Compensated Employee" means an Employee who

during the current Plan Year or the immediately preceding Plan

Year:

               (a)  was a five-percent owner, as defined in

section 416(i) of the Code;

               (b)  received more than $75,000 (as indexed) in

Compensation from a Participating Company or an Affiliated

Company;

               (c)  received more than $50,000 (as indexed) in

Compensation from a Participating Company or an Affiliated

Company and was among the top 20% of Employees of all

Participating Companies and Affiliated Companies ranked by

Compensation (excluding Employees described in section 414(q)(8)

of the Code to the extent (1) permitted under the Code and

regulations thereunder and (2) elected by the Committee, for

purposes of identifying the number of Employees in the top 20%);

or

               (d)  was among the 50 officers of a Participating

Company or an Affiliated Company (or, if lesser, the greater of 3

or 10% of all Employees, excluding Employees described in section

414(q)(8) of the Code, to the extent (1) permitted under the Code

and regulations thereunder and (2) elected by the Committee for

purposes of identifying the top 20%) and received Compensation of

more than $45,000 (as indexed); provided, however, that, if no

officer has satisfied the compensation requirement described

above during either the current Plan Year or the immediately

preceding Plan Year, the highest paid officer for such year shall

be treated as a Highly Compensated Employee.

Notwithstanding Subsections (b)-(d) of this definition, an

Employee, other than a five-percent owner, who was not a Highly

Compensated Employee in the preceding Plan Year is a Highly

Compensated Employee for the current Plan Year only if he is

among the top 100 Employees of all Participating Companies and

Affiliated Companies ranked by Compensation for the current Plan

Year.

          If an Employee is, during the current Plan Year or the

immediately preceding Plan Year, a family member of either a 5

percent owner who is an Employee or a former Employee or a Highly

Compensated Employee who is one of the 10 most highly compensated

Employees ranked by compensation during such year, then the

family member and the 5 percent owner or Highly Compensated

Employee shall be treated as a single Highly Compensated

Employee, and the Compensation and elective deferrals, employee

contributions and employer matching contributions of such family

member and 5 percent owner or Highly Compensated Employee shall

be aggregated in determining the Actual Deferral Percentage and

Contribution Percentage of such "single" Highly Compensated

Employee.  For purposes of this definition, "family member" shall

include the spouse, lineal ascendants and descendants of the

Employee or former Employee and the spouse of such lineal

ascendants and descendants.

          "Hour of Service" means, for any Employee, a credit

awarded with respect to:

               (a)  except as provided in (b) or (c),

                    (1)  each hour for which he is directly or

indirectly paid or entitled to payment by a Participating Company

or an Affiliated Company for the performance of employment

duties; or

                    (2)  each hour for which he is entitled,

either by award or agreement, to back pay from a Participating

Company or an Affiliated Company, irrespective of mitigation of

damages; or

                    (3)  each hour for which he is directly or

indirectly paid or entitled to payment by a Participating Company

or an Affiliated Company on account of a period of time during

which no duties are performed due to vacation, holiday, illness,

incapacity (including disability), jury duty, layoff, leave of

absence, or military duty; or

               (b)  For any period that includes any hours for

which an Hour of Service would otherwise be credited to an

Employee under (a), above, the Committee may, in accordance with

rules applied in a uniform and non-discriminatory manner, elect

instead to credit Hours of Service using one or more of the

following equivalencies:


Basis Upon Which Records           Credit Granted to Individual
     Are Maintained                       For Period

     shift                         actual hours for full shift

     day                            10 Hours of Service

     week                           45 Hours of Service

     semi-monthly period            95 Hours of Service

     month                         190 Hours of Service

               (c)  Anything to the contrary in Subsection (a) or

(b) notwithstanding:

                    (1)  No Hours of Service shall be credited to

an Employee for any period merely because, during such period,

payments are made or due him under a plan maintained solely for

the purpose of complying with applicable workers' compensation,

unemployment compensation, or disability insurance laws.

                    (2)  No more than 501 Hours of Service shall

be credited to an Employee under Paragraph (a)(3) of this

definition on account of any single continuous period during

which no duties are performed by him, except to the extent

otherwise provided in the Plan.

                    (3)  No Hours of Service shall be credited to

an Employee with respect to payments solely to reimburse for

medical or medically related expenses.

                    (4)  No Hours of Service shall be credited

twice.

                    (5)  Hours of Service shall be credited at

least as liberally as required by the rules set forth in U.S.

Department of Labor Reg. Section 2530.200b-2(b) and (c).

                    (6)  In the case of an Employee who is such

solely by reason of service as a leased employee within the

meaning of section 414(n) or 414(o) of the Code, Hours of Service

shall be credited as if such Employee were employed and paid with

respect to such service (or with respect to any related absences

or entitlements) by the Participating Company or Affiliated

Company that is the recipient thereof.

          "Investment Medium" means any fund, contract,

obligation, or other mode of investment selected by the Committee

to which a Participant may direct the investment of the assets of

his Account.

          "Limitation Year" means the Plan Year or such other

12-consecutive-month period as may be designated by the Company.

          "Matching Contributions" means, for any Participant,

the sum of his Pre-1994 Matching Contributions and Post-1993

Matching Contributions.

          "Normal Retirement Age" means, for any Participant, the

date on which he attains Age 65.

          "Normal Retirement Date" means, for any Participant,

the first day of the month coincident with or next following his

attainment of Normal Retirement Age.

          "Participant" means an individual for whom one or more

Accounts are maintained under the Plan.

          "Participating Company" means the Company and each

other organization which is authorized by the Board of Directors

to adopt this Plan by action of its board of directors or other

governing body.

          "Payroll Period" means a weekly, bi-weekly,

semi-monthly, or monthly pay period or such other standard pay

period of the Participating Company applicable to the class of

Employees of which the Eligible Employee is a part.

          "Plan" means the Westmoreland Coal Company and

Affiliated Companies Employees' Savings/Retirement Plan, as

renamed effective March 1, 1990 and as formerly known as the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, a profit sharing plan, as set forth herein.

          "Plan Year" means each 12-consecutive month period that

begins on September 1 and ends on the next following August 31.

          "Post-1989 Rollover Contributions" means, for any

Participant, his rollover contributions made after

February 28, 1990 as provided in Section 15.1.

          "Post-1993 Matching Contributions" means, for any

Participant, the contributions made by the Company after

November 30, 1993 pursuant to Section 3.4.

          "Post-1989 Salary Reduction Contributions" means, for

any Participant, contributions made on his behalf after

February 28, 1990 as provided in Section 3.1(a).

          "Pre-1994 Matching Contributions" means, for any

Participant, the Company Stock contributed by the Company prior

to December 1, 1993 pursuant to Section 3.4.

          "Pre-1990 Rollover Contributions" means, for any

Participant, his rollover contributions made prior to

March 1, 1990 as provided in Section 15.1.

          "Pre-1990 Salary Reduction Contributions" means, for

any Participant, contributions made on his behalf prior to

March 1, 1990 as provided in Section 3.1(a).

          "Qualified Domestic Relations Order" means a domestic

relations order (within the meaning of section 414(p)(1)(B) of

the Code) which creates or recognizes the existence of an

Alternate Payee's rights to, or assigns to an Alternate Payee the

right to receive all or a portion of the benefits payable with

respect to a Participant under the Plan, and is determined by the

Committee to satisfy the requirements of section 414(p) of the

Code.

          "Quarterly Status Date" means each November 30, last

day of February, May 31, August 31 of any year.

          "Required Beginning Date" means, for any Participant,

               (a)  if he attained Age 70-1/2 before

January 1, 1988, and is not a 5-percent owner (within the meaning

of section 416 of the Code) of a Participating Company at any

time during the five-Plan-Year period ending in the calendar year

in which he attained Age 70-1/2, or thereafter, April 1 of the

calendar year following the later of the calendar year in which

he has a Separation from Service or the calendar year in which he

attained Age 70-1/2;

               (b)  if he attained Age 70-1/2 before

January 1, 1988, and is a 5-percent owner (within the meaning of

section 416 of the Code) of a Participating Company at any time

during the five-Plan-Year period ending in the calendar year in

which he attained Age 70-1/2, or thereafter, the later of (1)

December 31, 1987 (2) April 1 of the calendar year following the

calendar year in which he attained Age 70-1/2 or (3) April 1 of

the calendar year in which he becomes a 5-percent owner.

               (c)  if he attained Age 70-1/2 before

January 1, 1989 and after December 31, 1987, is not a 5-percent

owner (within the meaning of section 416 of the Code) of a

Participating Company and has not had a Separation from Service

before January 1, 1989, April 1, 1990;

               (d)  except as otherwise provided in Subsection

(c), if he attains Age 70-1/2 on or after January 1, 1988,

April 1 of the calendar year next following the calendar year in

which he attains Age 70-1/2.

          "Rollover Contributions" means, for any Participant,

the sum of his Pre-1990 Rollover Contributions and his Post-1989

Rollover Contributions.

          "Salary Reduction Contributions" means, for any

Participant, the sum of his Pre-1990 Salary Reduction

Contributions and his Post-1989 Salary Reduction Contributions.

          "Separation from Service" means, for any Employee, his

death, retirement, resignation, discharge or any absence that

causes him to cease to be an Employee.

          "Spouse" means the person to whom a Participant is

married on any date of reference.

          "Total Disability" means, with respect to any

Participant:

               (a)  effective prior to September 1, 1995, a

disability with respect to which he is eligible for and receiving

disability benefits under the Federal Social Security Act and

which:  (1) prevents the Participant from engaging in any

substantial gainful activity, (2) can be expected to result in

death or to be of long-continued and indefinite duration, and (3)

is not self-inflicted, including a physical or mental impairment

from the voluntary use of alcohol or narcotics, or the result of

the commission of a crime by the Participant; and

               (b)  effective after August 31, 1995, a disability

with respect to which he is eligible for and receiving benefits

under a long-term disability program sponsored by a Participating

Company or an Affiliated Company and which can reasonably be

expected to be of long-continued and indefinite duration

rendering him unable to return to work.

          "Trust Agreement" means any agreement and declaration

of trust executed under this Plan.

          "Trustee" means the corporate trustee or one or more

individuals collectively appointed and acting under the Trust

Agreement.

          "Valuation Date" means, prior to March 1, 1995, each

Quarterly Status Date and each interim date on which the

Committee determines that a valuation of the Fund shall be made.

Effective after February 28, 1995, "Valuation Date" means, for

any Investment Medium, each business day, except for such

business days on which Dreyfus Retirement Services, or its

successor, determines that a valuation of such Investment Medium

shall not be made.

          "Voluntary Contributions" means a Participant's

voluntary contributions made prior to June 1, 1984 pursuant to

the Plan as in effect at such time.

                           ARTICLE II

           TRANSITION AND ELIGIBILITY TO PARTICIPATE


       .1   Rights Affected and Preservation of Accrued Benefit.  Except

as provided to the contrary herein, the provisions of this

amended and restated Plan shall apply only to Employees who

complete an Hour of Service on or after the Effective Date.  The

rights of any other individual shall be governed by the Plan as

in effect upon his Separation from Service, except to the extent

expressly provided in any amendment adopted subsequently thereto.

       .2        Eligibility to Participate - Salary Reduction

Contributions.

               (a)  Each Covered Employee as of the Effective

Date who was eligible to participate in the Plan immediately

prior to the Effective Date shall continue to be an Eligible

Employee as of the Effective Date.

               (b)  Each Covered Employee who was not eligible to

participate immediately prior to the Effective Date shall become

an Eligible Employee upon the first day of the month following

the date he is credited with 1,000 or more Hours of Service if he

is then a Covered Employee.

               (c)  If an individual is not a Covered Employee on

the date he would otherwise become an Eligible Employee pursuant

to Subsection (b) of this Section, he shall become an Eligible

Employee as of the first date thereafter on which he is a Covered

Employee.

               (d)  An Eligible Employee who ceases to be a

Covered Employee, by Separation from Service or otherwise, and

who later becomes a Covered Employee, shall become an Eligible

Employee as of the date on which he first again completes an Hour

of Service as a Covered Employee.

       .1   Election to Make Salary Reduction Contributions.  Each

Eligible Employee may elect to make Salary Reduction

Contributions and become an Active Participant by filing a

written notice of such election with the Committee on such form

provided for that purpose.  Such notice shall authorize the

Participating Company to reduce such Eligible Employee's

Compensation by an amount determined in accordance with Section

3.1 and to make Salary Reduction Contributions on such Eligible

Employee's behalf in the amount of such reduction.  Such election

shall become effective as soon as administratively possible, but

no sooner than the first day of the Payroll Period next following

receipt of the election by the Committee.

       .2        Participation in Matching Contributions.  An Eligible

Employee shall share in Matching Contributions under Section 3.4

for any Plan Year if Salary Reduction Contributions are made on

his behalf in such Plan Year.

       .3        Data.  Each Employee shall furnish to the Committee

such data as the Committee may consider necessary for the

determination of the Employee's rights and benefits under the

Plan and shall otherwise cooperate fully with the Committee in

the administration of the Plan.

                          ARTICLE III

                   CONTRIBUTIONS TO THE PLAN


       .3   Salary Reduction Contributions.

               (a)  When an Eligible Employee files an election

under Section 2.3 to have Salary Reduction Contributions made on

his behalf, he shall elect the percentage by which his

Compensation shall be reduced on account of such Salary Reduction

Contributions.  Effective prior to March 1, 1995, subject to

Section 3.9, this percentage may be between one percent (1%) and

ten percent (10%) of such Compensation, rounded to the nearer

whole percent.  Effective after February 28, 1995, subject to

Section 3.9, this percentage may be between one percent (1%) and

fifteen percent (15%) of such Compensation, rounded to the nearer

whole percent.  The Participating Company shall contribute an

amount equal to such percentage of the Eligible Employee's

Compensation to the Fund for credit to the Eligible Employee's

Salary Reduction Account provided that such contributions may be

prospectively limited as provided in Section 3.8.

               (b)  Salary Reduction Contributions made on behalf

of an Eligible Employee under this Plan together with elective

deferrals under any other plan or arrangement maintained by any

Participating Company or Affiliated Company shall not exceed

$7,000 (as indexed) (as adjusted in accordance with section

402(g) of the Code and regulations thereunder) for any calendar

year.  To the extent necessary to satisfy this limitation for any

year:

                    (1)  elections under Subsection (a) of this

Section shall be prospectively restricted; and,

                    (2)  after application of Subparagraph (1),

the excess Salary Reduction Contributions and excess elective

deferrals under any other plan or arrangement maintained by any

Participating Company or Affiliated Company (with earnings

thereon, but reduced by any amounts previously distributed under

Subsection (a) of Section 3.8 for the year) shall be paid to the

Participant on or before the April 15 first following the

calendar year in which such contributions were made.

If the Salary Reduction Contributions plus elective deferrals

described above do not exceed such limitation, but Salary

Reduction Contributions, plus the elective deferrals, as defined

in section 402(g)(3) of the Code, under any other plan for any

Participant exceed such limitation for any calendar year, upon

the written request of the Participant made on or before the

March 1 first following such calendar year, the excess, including

any earnings attributable thereto, designated by the Participant

to be distributed from the Plan shall be paid to the Participant

on or before the April 15 first following such calendar year.

       .4   Change of Percentage Rate.  A Participant may without

penalty change the percentage of Compensation designated by him

as his contribution rate under Subsection (a) of Section 3.1, to

any percentage permitted by such Subsection, and such percentage

shall remain in effect until so changed.  Effective prior to

March 1, 1995, any such change shall become effective as of the

September 1, December 1, March 1 or June 1 next following receipt

of the change by the Committee, provided that the Committee

receives written notice of such change by the fifteenth day of

the month prior to the effective date of the change.  Effective

after February 28, 1995, a Participant may change the percentage

of Compensation designated by him as his contribution rate under

Subsection (a) of Section 3.1 on any day of a calendar month,

provided that only one change may be made in any calendar month.

Such change shall become effective as soon as administratively

possible, but no sooner than the first day of the Payroll Period

next following receipt of notice of the change by the Committee.

       .5        Discontinuance of Salary Reduction Contributions.  A

Participant may discontinue his Salary Reduction Contributions at

any time.

                  (a)  Effective prior to March 1, 1995,

such discontinuance shall become effective as of the first day of

the Payroll Period next following receipt of the discontinuance

by the Committee, provided that the Committee receives written

notice of the discontinuance at least 15 days prior to the first

day of such Payroll Period.  A Participant who discontinues his

Salary Reduction Contributions prior to March 1, 1995 may not

resume his Salary Reduction Contributions until the first day of

the Payroll Period after any Quarterly Status Date that follows a

3-month period of suspension of Salary Reduction Contributions.

                    (b)  Effective after February 28, 1995, a

discontinuance of Salary Reduction Contributions shall become

effective as soon as administratively feasible but no sooner than

the first day of the Payroll Period next following receipt of

notice of the change by the Committee.  A Participant who

discontinues his Salary Reduction Contributions after

February 28, 1995 may not resume his Salary Reduction

Contributions until the first day of the Payroll Period following

the first day of any calendar month.

       .6   Matching Contribution.

               (a)  Subject to Sections 3.7 and 3.9, the

Participating Company shall contribute the following amounts to

the Fund which shall be invested as provided in Subsections (b)

and (c) of this Section:

                    (1)  for any Payroll Period beginning before

September 1, 1988, an amount equal to one hundred percent (100%)

of all Participants' Salary Reduction Contributions for such Plan

Year, offset by the amount, if any, of Matching Contributions

forfeited during such Plan Year, provided that such contributions

may be prospectively limited as provided in Section 3.8 and

provided further that the contribution under this Section for any

Plan Year shall not cause the total contributions by the

Participating Company to exceed the maximum allowable current

deduction under the applicable provisions of the Code.  Matching

Contributions shall be credited to the Matching Contribution

Accounts of Participants in proportion to their Salary Reduction

Contributions for the Plan Year; and

                    (2)  for any Payroll Period beginning on or

after September 1, 1988, an amount equal to fifty percent (50%)

of all Participants' Salary Reduction Contributions for such Plan

Year not in excess of five percent (5%) of each Eligible

Employee's Compensation, offset by the amount, if any, of

Matching Contributions forfeited during such Plan Year, provided

that such contributions may be prospectively limited as provided

in Section 3.8 and provided further that the contribution under

this Section for any Plan Year shall not cause the total

contributions by the Participating Company to exceed the maximum

allowable current deduction under the applicable provisions of

the Code.  Matching Contributions shall be credited to the

Matching Contribution Accounts of Participants in proportion to

their Salary Reduction Contributions for the Plan Year not in

excess of five percent (5%) of each Eligible Employee's

Compensation.

               (b)  Pre-1994 Matching Contributions shall be

invested in common stock of the Company; except that, effective

with respect to Pre-1994 Matching Contributions allocated to a

Participant's Account after February 28, 1993, a Participant may

elect, effective as of any March 1, June 1, September 1 or

December 1, in such manner as the Committee may prescribe for

this purpose, to have Pre-1994 Matching Contributions allocated

to his Account in any Plan Year quarter invested in either common

or preferred stock of the Company; provided, that, (1) the

Participant elects to have the entire amount of Pre-1994 Matching

Contributions allocated to his Account in any Plan Year quarter

invested in either common or preferred stock of the Company, and

(2) such election may not be subsequently modified or revoked by

the Participant until the Participant attains Age 55 and directs

the investment of Company Stock in accordance with Section 12.1

and (3) the Committee receives such election on or before the

fifteenth day of the month preceding such March 1, June 1,

September 1 or December 1.

               (c)  Post-1993 Matching Contributions allocated to

a Participant's Account shall be invested in any Investment

Medium selected by the Participant in accordance with Section

12.2.

       .1   Timing and Deductibility of Contributions.  Matching

Contributions for any Plan Year under this Article shall be made

no later than the last date on which amounts so paid may be

deducted for Federal income tax purposes for the taxable year of

the employer in which the Plan Year ends.  All Participating

Company contributions are expressly conditioned upon their

deductibility for Federal income tax purposes.  Amounts

contributed as Salary Reduction Contributions or Rollover

Contributions will be remitted to the Trustee as soon as

practicable, but no later than 90 days after the date on which

such contributions were received or withheld from the

Participant's Compensation.

       .2        Fund.  The contributions deposited by the Participating

Company in the Fund in accordance with this Article shall

constitute a fund held for the benefit of Participants and their

eligible beneficiaries under and in accordance with this Plan.

No part of the principal or income of the Fund shall be used for,

or diverted to, purposes other than for the exclusive benefit of

such Participants and their eligible beneficiaries (including

necessary administrative costs); provided, that in the case of a

contribution made by the Participating Company as a mistake of

fact, or for which a tax deduction is disallowed, in whole or in

part, by the Internal Revenue Service, the Participating Company

shall be entitled to a refund of said contributions, which must

be made within one year after payment of a contribution made as a

mistake of fact, or within one year after disallowance.

       .3        Limitation on Salary Reduction Contributions and

Matching Contributions.

               (a)  For any Plan Year, the Average Actual

Deferral Percentage for the Highly Compensated Eligible Employees

shall not exceed the greater of:

                    (1)  one hundred twenty-five percent (125%)

of the Average Actual Deferral Percentage for all other Eligible

Employees; or

                    (2)  the lesser of:

                         (A)  two hundred percent (200%) of the

Average Actual Deferral Percentage for all other Eligible

Employees; or

                         (B)  two percent (2%) plus the Average

Actual Deferral Percentage for all other Eligible Employees. 

                   (b) For any Plan Year, the Average Contribution

Percentage for the Highly Compensated Eligible Employees shall not

exceed the greater of:

                    (1)  one hundred twenty-five (125%) of the

Average Contribution Percentage for all other Eligible Employees;

or

                    (2)  the lesser of:

                         (A)  two hundred percent (200%) of the

Average Contribution Percentage for all other Eligible Employees;

or

                         (B)  two percent (2%) plus the Average

Contribution Percentage for all other Eligible Employees.

               (c)  For any Plan Year beginning after

December 31, 1988, the sum of the Average Actual Deferral

Percentage and the Average Contribution Percentage for the Highly

Compensated Eligible Employees shall not exceed the greater of:

                    (1)  the sum of:

                         (A)  one hundred twenty-five percent

(125%) of the greater of the Average Actual Deferral Percentage

or the Average Contribution Percentage for all other Eligible

Employees; plus

                         (B)  the lesser of:

                              (i)  two hundred percent (200%) of

the lesser of the Average Actual Deferral Percentage or the

Average Contribution Percentage for all other Eligible Employees;

or

                             (ii)  two percent (2%) plus the

lesser of the Average Actual Deferral Percentage or the Average

Contribution Percentage for all other Eligible Employees; or

                    (2)  the sum of:

                         (A)  one hundred twenty-five percent

(125%) of the lesser of the Average Actual Deferral Percentage or

the Average Contribution Percentage for all other Eligible

Employees; plus

                         (B)  the lesser of:

                              (i)  two hundred percent (200%) of

the greater of the Average Actual Deferral Percentage or the

Average Contribution Percentage for all other Eligible Employees;

or

                             (ii)  two percent (2%) plus the

greater of the Average Actual Deferral Percentage or the Average

Contribution Percentage for all other Eligible Employees.

               (d)  For purposes of this Section, the Salary

Reduction Contributions and Matching Contributions, respectively,

of any 5% owner or other Highly Compensated Employee who is one

of the top 10 Employees ranked by pay (without regard to this

sentence) for the Plan Year or the preceding Plan Year shall be

increased by the amount of the Salary Reduction Contributions and

Matching Contributions, respectively of any Employee who is a

spouse or lineal ascendant or descendant (or a spouse thereof)

("family member") of such Highly Compensated Employee, and the

Compensation of the former shall be increased by the Compensation

of the latter, and such family member and such Highly Compensated

Employee shall be treated as a single Highly Compensated Eligible

Employee and such family member shall not be treated as a

separate Eligible Employee for purposes of applying this Section.

The application of this Subsection (d) and the determination of

the Actual Deferral Percentage and Contribution Percentage of

such single Highly Compensated Eligible Employee shall be made in

accordance with sections 414(q), 401(k) and 401(m) of the Code

and regulations thereunder.

               (e)  If the Plan and any other plan(s) maintained

by a Participating Company or an Affiliated Company are treated

as a single plan for purposes of section 401(a)(4) or section

410(b) of the Code, the limitations in Subsections (a) through

(d) of this Section shall be applied by treating the Plan and

such other plan(s) as a single plan.

               (f)  The application of this Section shall satisfy

sections 401(k) and 401(m) of the Code and regulations thereunder

and such other requirements as may be prescribed by the Secretary

of the Treasury.

       .7   Prevention of Violation of Limitation on Salary Reduction

Contributions and Matching Contributions.  The Committee shall

monitor the level of Participants' Salary Reduction Contributions

and Matching Contributions and elective deferrals, employee

contributions, and employer matching contributions under any

other qualified retirement plan maintained by a Participating

Company or any Affiliated Company to insure against exceeding the

limits of Section 3.7.  To the extent practicable, the Plan

Administrator may prospectively limit (i) some or all of the

Highly Compensated Eligible Employees' Salary Reduction

Contributions to reduce the Average Actual Deferral Percentage of

the Highly Compensated Eligible Employees to the extent necessary

to satisfy subsection (a) of Section 3.7 and/or (ii) some or all

of the Highly Compensated Eligible Employees' Matching

Contributions to reduce the Average Contribution Percentage of

the Highly Compensated Eligible Employees to the extent necessary

to satisfy subsection (b) of Section 3.7 and/or (iii) some or all

of the Highly Compensated Eligible Employees' Salary Reduction

Contributions, and Matching Contributions to the extent necessary

to satisfy subsection (c) of Section 3.7.  If the Committee

determines after the end of the Plan Year that the limits of

Section 3.7 may be or have been exceeded, it shall take the

appropriate following action for such Plan Year:

               (a)  (1)  The Average Actual Deferral Percentage

for the Highly Compensated Eligible Employees shall be reduced to

the extent necessary to satisfy Subsection (a) of Section 3.7. 

                 (2) The reduction shall be accomplished by reducing

the maximum Actual Deferral Percentage for any Highly Compensated

Eligible Employee to an adjusted maximum Actual Deferral Percentage,

which shall be the highest Actual Deferral Percentage that would

cause one of the tests in Subsection 3.7(a) to be satisfied, if each Highly

Compensated Eligible Employee with a higher Actual Deferral Percentage

had instead the adjusted maximum Actual Deferral Percentage, reducing

the Highly Compensated Eligible Employee's Salary Reduction Contributions

and elective deferrals under any other qualified retirement plan

maintained by the Participating Company or any Affiliated Company

(less any amounts previously distributed under Section 3.1 for the

year) in order, beginning with the Highly Compensated Eligible Employee(s)

with the highest Actual Deferral Percentage; provided, however,

that excess contributions shall be allocated to Eligible Employees

who are subject to the family member aggregation rules of section

414(q)(6) of the Code in the manner prescribed by regulations.

                    (3)  Not later than the end of the Plan Year

following the close of the Plan Year for which the Salary

Reduction Contributions were made, the difference between a

Highly Compensated Eligible Employee's Actual Deferral Percentage

and the Highly Compensated Eligible Employee's adjusted maximum

Actual Deferral Percentage, at the Committee's direction, shall

be paid to the Highly Compensated Eligible Employee, with

earnings attributable thereto (as determined in accordance with

applicable Treasury Regulations); provided, however, that for any

Participant who is also a participant in any other qualified

retirement plan maintained by the Participating Company or any

Affiliated Company under which the Participant makes elective

deferrals for such year, the Committee shall coordinate

corrective actions under this Plan and such other plan for the

year.

               (b)  (1)  The Average Contribution Percentage for

the Highly Compensated Eligible Employees shall be reduced to the

extent necessary to satisfy at least one of the tests in

Subsection (b) of Section 3.7.

                    (2)  The reduction shall be accomplished by

reducing the maximum Contribution Percentage for any Highly

Compensated Eligible Employee to an adjusted maximum Contribution

Percentage, which shall be the highest Contribution Percentage

that would cause one of the tests in Section 3.7(b) to be

satisfied, if each Highly Compensated Eligible Employee with a

higher Contribution Percentage had instead the adjusted maximum

Contribution Percentage, reducing, in the following order of

priority, the Highly Compensated Eligible Employees' Matching

Contributions and employee contributions and employer matching

contributions under any other qualified retirement plan

maintained by the Participating Company or an Affiliated Company,

in order beginning with the Highly Compensated Eligible

Employee(s) with the highest Contribution Percentage; provided,

however, that excess contributions shall be allocated to Eligible

Employees who are subject to the family member aggregation rules

of section 414(q)(6) of the Code in the manner prescribed in

regulations.

                    (3)  Not later than the end of the Plan Year

following the close of the Plan Year for which such contributions

were made, the difference between a Highly Compensated Eligible

Employee's Contribution Percentage and the Highly Compensated

Eligible Employee's adjusted maximum Contribution Percentage,

with earnings attributable thereto (as determined in accordance

with applicable Treasury Regulations), at the Committee's

direction, shall be paid to the Highly Compensated Eligible

Employee;

provided, however, that, for any Participant who is also a

participant in any other qualified retirement plan maintained by

the Participating Company or any Affiliated Company under which

the Participant makes employee contributions or is credited with

employer matching contributions for the year, the Committee shall

coordinate corrective actions under this Plan and such other plan

for the year.

               (c)  (1)  The Average Contribution Percentage

and/or the Average Actual Deferral Percentage (as determined

under Subparagraph (2) below) for the Highly Compensated Eligible

Employees shall be reduced to satisfy the test in Subsection (c)

of Section 3.7 in a manner and to the extent determined by the

Committee.

                    (2)  The reductions shall be accomplished in

the same manner as is set forth in Subsections (a) and (b) of

Section 3.8, whichever is appropriate.  A reduction to the

Average Actual Deferral Percentage shall be charged against the

appropriate Highly Compensated Eligible Employees' Salary

Reduction Accounts.  A reduction to the Average Contribution

Percentage shall be charged against the appropriate Highly

Compensated Eligible Employees' Matching Contribution Accounts.

Notwithstanding the foregoing, for any Participant who is also a

participant in any other qualified retirement plan maintained by

a Participating Company or any Affiliated Company under which the

Participant makes employee contributions or elective deferrals or

is credited with employer matching contributions for such year,

the Committee shall coordinate corrective actions under this Plan

and such other plan for the year.

               (d)  Effective September 1, 1988, if the

corrective payment to a Highly Compensated Eligible Employee of

his Salary Reduction Contributions pursuant to Paragraph (a)(3)

causes Matching Contributions made on his behalf for the Plan

Year (excluding such Matching Contributions that were paid to the

Participant pursuant to Subsection (b)(2) or Subsection (c) of

this Section) to exceed five percent (5%) of his remaining Salary

Reduction Contributions for the Plan Year, the Matching

Contributions in excess of five percent (5%) of his Salary

Reduction Contributions for the Plan Year that were not

distributed to him shall be forfeited, and used to offset future

Matching Contributions.

               (e)  If the Plan and any other plan maintained by

a Participating Company or an Affiliated Company are treated as a

single plan pursuant to Subsection (e) of Section 3.7, the

Committee shall coordinate corrective actions under the Plan and

such other plan for the year.

       .8   Maximum Allocation.  The provisions of this Section shall be

construed to comply with section 415 of the Code.

               (a)  Notwithstanding anything in this Plan to the

contrary, in no event shall the sum of:

                    (1)  any Matching Contributions, Salary

Reduction Contributions and other employer contributions; any

forfeitures, and any employee contributions allocated for any

Limitation Year to any Participant (including any such amounts

distributed pursuant to Section 3.8 but not amounts distributed

pursuant to Subsection (b) (c) of Section 3.1) under this and any

other defined contribution plan maintained by the Participating

Company or any 50% Affiliated Company; and

                    (2)  all amounts allocated to any Participant

after March 31, 1984 to an individual medical account (within the

meaning of Code section 415(l)(2)) which is part of a pension or

annuity plan maintained by a Participating Company or any 50%

Affiliated Company; and

                    (3)  all amounts derived from contributions

paid or accrued after December 31, 1985, in taxable years ending

after such date which are attributable to post-retirement medical

benefits allocated to a separate account of a Participant who is

a key employee, as defined in section 419A(d)(3) of the Code,

under a welfare benefit fund maintained by a Participating

Company or any 50% Affiliated Company;

exceed the lesser of $30,000, (or such other dollar limitation in

effect for the Limitation Year under section 415(c)(1)(A) of the

Code) or twenty-five percent (25%) of such Participant's

Compensation for the Limitation Year.  The 25% Compensation

limitation shall not apply to any contribution for medical

benefits (within the meaning of section 401(h) or 419A(f)(2) of

the Code) which is otherwise treated as an annual addition under

section 415(l)(1) or 419A(d)(2) of the Code.

               (b)  If the amount otherwise allocable to the

Account of a Participant would exceed the amount described in

Subsection (a) of this Section as a result of the reallocation of

forfeitures, a reasonable error in estimating the Participant's

Compensation, a reasonable error in determining the amount of

Salary Reduction Contributions that may be made with respect to a

Participant under the limits of this Section or such other

circumstances as permitted by law, the Committee shall determine

which portion, if any, of such excess amount is attributable to

the Participant's Salary Reduction Contributions, and/or Matching

Contributions until such amount has been exhausted, and shall

take the following appropriate steps to correct such violation:

                    (1)  Excess Salary Reduction Contributions

and earnings thereon shall be paid to the Participant as soon as

is administratively feasible.

                    (2)  (A)  While the Participant remains a

Covered Employee, his excess Matching Contributions shall be held

in a suspense account (which shall share in investment gains and

losses of the Fund) by the Trustee until the following Plan Year

(or any succeeding Plan Years), at which time such amounts shall

be allocated to the Participant's Account before any Matching

Contributions are made on his behalf for such Plan Year; and

                         (B)  When the Participant ceases to be a

Covered Employee, his excess Matching Contributions, along with

earnings thereon, held in the suspense account shall be allocated

in the following Plan Year (or any succeeding Plan Years) to the

Accounts of other Participants in the Plan.

               (c)  If, in any Limitation Year, a Participant in

this Plan is also a participant in one or more defined benefit

plans maintained by the Participating Company or any 50%

Affiliated Company, the projected annual benefit referred to in

Paragraph (c)(1) shall be reduced, if necessary, so that the sum

of the fractions described in (1) and (2) does not exceed 1.0 for

such Limitation Year.

                    (1)  Defined Benefit Fraction - a fraction,

the numerator of which is the Participant's projected annual

benefit under all such defined benefit pension plans determined

as of the close of the limitation years of such plans, and the

denominator of which is the lesser of:

                         (A)  1.25 x $90,000 (or such other

dollar limitation determined for the Limitation Year under

section 415(b)(1)(A) of the Code); or

                         (B)  one hundred forty percent (140%) of

the Participant's highest average Compensation over any three

consecutive calendar years;

provided, however, that the denominator of the defined benefit

fraction shall be determined after taking into account any

adjustments to the dollar limit described in Subparagraph (A) or

to the compensation limit described in Subparagraph (B)

prescribed by sections 415(b) or 415(d) of the Code, as

appropriate.  For the purpose of this Paragraph (1), "projected

annual benefit" means the annual benefit to which a Participant

would be entitled under the terms of a defined benefit plan if he

had continued employment until his normal retirement date under

such plan and if his compensation counted for the purpose of such

plan had continued at the same rate.

                    (2)  Defined Contribution Fraction - a

fraction, the numerator of which is the sum of the annual

additions to the Participant's accounts under all defined

contribution plans sponsored by the Participating Company or any

50% Affiliated Company for all limitation years, and the

denominator of which is the sum of the lesser of the following

amounts, determined for each of such limitation years and for

each prior limitation year of service with the Participating

Company or 50% Affiliated Company:

                         (A)  1.25 x $30,000 (or such other

dollar limitation in effect for the Limitation Year under section

415(c)(1)(A) of the Code); or

                         (B)  thirty-five percent (35%) of the

Participant's Compensation for such limitation year.

               (d)  If the Plan and the defined benefit plan

referred to in Paragraph (c)(1) satisfied section 415 of the Code

for the Plan Year ending December 31, 1986, an amount shall be

subtracted from the numerator of the fraction described in

Paragraph (c)(2) (not exceeding such numerator).  The amount to

be subtracted shall be the product of:

                    (1)  the sum of the defined contribution

fraction under Paragraph (c)(2) plus the defined benefit fraction

under Paragraph (c)(1) as of December 31, 1986 minus one,

multiplied by

                    (2)  the denominator of the defined

contribution fraction under Paragraph (c)(2) as of

December 31, 1986.

               (e)  To the extent that any qualified defined

contribution plan was in existence on July 1, 1982, the Committee

may elect to apply Paragraph (c)(2) of this Section with respect

to any Limitation Year ending after December 31, 1982 by

calculating the denominator under Paragraph (c)(2) using an

alternate amount for all Limitation Years ending before

January 1, 1983.  The alternate amount shall be equal to the

amount determined for the denominator under Paragraph (c)(2) as

in effect for the Limitation Year ending in 1982 multiplied by a

fraction, the numerator of which is the lesser of $51,875 or

thirty-five percent (35%) of the Participant's Compensation for

the Limitation Year ending in 1981, and the denominator of which

is the lesser of $41,500 or twenty-five percent (25%) of the

Participant's Compensation for the Plan Year ending in 1981.

                           ARTICLE IV

                     PARTICIPANTS' ACCOUNTS


       .1   Accounts.  All contributions and earnings thereon may be

invested in one commingled Fund for the benefit of all

Participants.  However, in order that the interest of each

Participant may be accurately determined and computed, separate

Accounts shall be maintained for each Participant and each

Participant's Accounts shall be made up of subaccounts reflecting

his investment elections pursuant to Article XII.  These Accounts

shall represent the Participant's individual interest in the

Fund.  All contributions shall be credited to Participants'

Accounts as set forth in Article III.

       .2        Valuation.  The value of each Investment Medium in the

Fund shall be computed by the Trustee as of the close of business

on each Valuation Date on the basis of the fair market value of

the assets of the Fund.

       .3        Apportionment of Gain or Loss.  The value of the Fund

each Investment Medium in the Fund, as computed pursuant to

Section 4.2, shall be compared with the value of such Investment

Medium in the Fund as of the preceding Valuation Date.  Any

difference in the value, not including contributions or

distributions made since the preceding Valuation Date, shall be

the net increase or decrease of such Investment Medium in the

Fund, and such amount shall be ratably apportioned by the Trustee

on its books, among the Participants' Accounts which are invested

in such Investment Medium at the current Valuation Date.

       .4        Accounting for Allocations.  The Committee shall

establish or provide for the establishment of accounting

procedures for the purpose of making the allocations, valuations

and adjustments to Participants' Accounts provided for in this

Article.  From time to time such procedures may be modified for

the purpose of achieving equitable and non-discriminatory

allocations among the Accounts of Participants in accordance with

the general concepts of the Plan and the provisions of this

Article.

         4.5   Statement of Account.  As soon as reasonably

practicable following each Quarterly Status Date, the Trustee

shall provide each Participant with a statement of his Account

for the preceding Plan Year quarter.

                           ARTICLE V

                          DISTRIBUTION


       .1   General.  The interest of each Participant in the Fund shall

be distributed in the manner, in the amount, and at the time

provided in this Article, except as provided in Article VIII and

except in the event of the termination of the Plan.  The

provisions of this Article shall be construed in accordance with

section 401(a)(9) of the Code and regulations thereunder,

including, effective for distributions that commence on or after

January 1, 1989, the incidental death benefit requirements of

section 401(a)(9)(G) of the Code.

       .2        Separation from Service.  A Participant who has a

Separation from Service for reasons other than death or Total

Disability shall have his interest in his Account paid to him or

applied for his benefit in accordance with the provisions of this

Article.

       .3   Death.  If a Participant dies before his entire interest in

his Account has been paid to him, his remaining interest shall be

paid to, or applied for the benefit of, his beneficiary in

accordance with the provisions of this Article.

       .4        Total Disability.

               (a)  Effective prior to September 1, 1995, if a

Participant who is an Employee suffers a Total Disability, has a

Separation from Service due to his Total Disability, and remains

Totally Disabled for a period of 6 consecutive months, his

Account shall be paid to him or applied for his benefit in

accordance with the provisions of this Article following the

determination of his Total Disability and his Separation from

Service.

               (b)  Effective after August 31, 1995, if a

Participant who is an Employee suffers a Total Disability, his

Account shall be paid to him or applied for his benefit in

accordance with the provisions of this Article following the

determination of his Total Disability.

               (c)  Total Disability shall be determined by the

Committee, which may consult with a medical examiner selected by

it.  The medical examiner shall have the right to make such

physical examinations and other investigations as may be

reasonably required to determine Total Disability.

       .1   Valuation for Distribution.  For the purposes of paying the

amounts to be distributed to a Participant or his beneficiaries

under the provisions of this Article, the value of the Fund and

the amount of the Participant's interest shall be determined in

accordance with the provisions of Article IV as of the Valuation

Date coincident with or immediately preceding the date of any

payment under this Article.  Such amount shall be adjusted to

take into account any additional contributions and forfeitures,

if any, which have been or are to be allocated to the

Participant's Account since that Valuation Date, and any

distributions or withdrawals made since that date.

Notwithstanding the above, the Participants' Account shall

be reduced by the amount necessary to repay any outstanding loan

from the Plan and interest thereon to the date the Committee

declares such loan satisfied, unless such loan is repaid as

provided in Section 9.4(e).

       .2   Timing of Distribution.

               (a)  Any Participant who has a Separation from

Service for any reason other than death shall be entitled to

receive his interest in his Account, pursuant to the following

rules:

                    (1)  Except as provided in Paragraph (a)(2),

if the Participant's interest in his Account is $3,500 or less,

or the Participant has attained Normal Retirement Age, the

Participant's Benefit Commencement Date shall be the earliest

practicable date following the Valuation Date coincident with or

next following his Separation from Service.

                    (2)  If the Participant has not attained

Normal Retirement Age and his interest exceeds, or has ever

exceeded at the time of any prior distribution, $3,500, his

Benefit Commencement Date shall be the earliest practicable date

following the Valuation Date coincident with or next following

his Separation from Service, except that, if the Participant does

not consent to such distribution, distribution of his benefits

shall commence on any later date elected by the Participant, that

is not later than his Normal Retirement Date, at which time his

interest shall be automatically paid to him, unless the

Participant elects to defer payment to a date not later than his

Required Beginning Date in accordance with Paragraph (a)(4).  A

Participant's election to receive payment prior to his Normal

Retirement Date may be made no earlier than 90 days prior to the

Benefit Commencement Date elected by the Participant.

                    (3)  The Committee shall inform each

Participant who is subject to this Paragraph (a)(2) of his right

to defer distribution.  Such notice shall be furnished not less

than 30 days nor more than 90 days prior to the date of any

distribution that occurs prior his Normal Retirement Date, except

that such notice may be furnished less than 30 days prior to the

date of distribution if (A) the Committee informs the Participant

that the Participant has the right to a period of at least 30

days after receiving such notice to consider the decision whether

to elect a distribution and the mode in which he desires such

distribution to be made, and (B) the Participant, after receiving

such notice, affirmatively elects a distribution.

                    (4)  Notwithstanding the foregoing, the

Participant's Benefit Commencement Date shall be no later than

the 60th day following the close of the Plan Year in which the

Participant attains his Normal Retirement Age or has a Separation

from Service, whichever occurs last, unless the Participant

elects in writing on a form supplied by the Committee to defer

his Benefit Commencement Date to a later date.  In no event,

however, shall a Participant's Benefit Commencement Date be later

than his Required Beginning Date, except pursuant to a valid

deferral election filed by the Participant with the Committee

before January 1, 1984.  In the event the Participant defaults on

an outstanding loan such that the unpaid balance becomes due and

payable pursuant to Article IX and the Participant fails to repay

the loan in accordance with Section 9.4(e), that portion of the

Participant's Account pledged as security for the loan shall be

applied to repay the loan and shall be deemed distributed to the

Participant within 60 days of the default; in which case, the

Participant may defer commencement of the balance of his Account

as described above.

               (b)  If a Participant dies before his entire

interest in his Account has been paid to him, his remaining

interest shall be distributed to his beneficiary commencing as

soon as practicable following the Participant's death.

               (c)  This Section shall apply to all Participants,

including Participants who had a Separation from Service or

ceased to be Covered Employees prior to January 1, 1989.

       .1   Mode of Distribution.

               (a)  If a Participant's interest under the Plan as

of his Separation from Service or death, whichever applies, does

not exceed $3,500, his interest shall be paid to him, or benefits

payable under Section 5.3 upon the death of a Participant shall

be distributed to his beneficiary, in a single sum.

               (b)  Except as provided to the contrary in

Subsection (a), a Participant or a beneficiary entitled to

benefits under Section 5.3 upon the death of a Participant may

elect in writing to have the Participant's interest paid in

accordance with either of the following modes of payment;

                    (1)  a single sum payment; or

                    (2)  an annuity contract meeting the

requirements of section 401(g) of the Code, purchased by the

Trustee at the direction of the Committee from an insurance

company licensed to do business in the state in which the

principal place of business of the Company is located, providing

payments for a term of five years, 10 years or 15 years, as

elected by the Participant or beneficiary in accordance with

rules established by the Committee for this purpose.  A

Participant may not elect a term which is longer than his life

expectancy at the date distributions begin.  All payment of

benefits under the annuity contract to a beneficiary shall be

completed within five years from the Participant's date of death.

               (c)  Benefits payable in a single sum under this

Section 5.7 shall be made in cash; except, to the extent that any

portion of the Participant's Account is invested in Company

Stock, distribution of that portion of his Account shall be made

as follows:

                    (1)  distribution with respect to a

Participant who has fewer than 10 shares of Company Stock

allocated to his Account shall be made in cash unless the

Participant files a written request with the Committee directing

that the distribution be made in Company Stock, in which event

such request shall be honored; and

                    (2)  distribution with respect to a

Participant who has 10 or more shares of Company Stock allocated

to his Account shall be made in shares of Company Stock or in

cash as elected by the Participant or beneficiary pursuant to a

procedure established by the Committee.

               (d)  If a Participant or beneficiary fails to make

an election under Subsection (b), the value of his or her Account

shall be distributed as a single sum payment.

       .1   Beneficiary Designation.

               (a)  Except as provided in this Section, a

Participant may designate the beneficiary or beneficiaries who

shall receive, on or after his death, his interest in the Fund.

Such designation shall be made by executing and filing with the

Committee a written instrument in such form as may be prescribed

by the Committee for that purpose.  Except as provided in this

Section, the Participant may also revoke or change, at any time

and from time to time, any beneficiary designations previously

made.  Such revocations and/or changes shall be made by executing

and filing with the Committee a written instrument in such form

as may be prescribed by the Committee for that purpose.  If a

Participant names a trust as beneficiary, a change in the

identity of the trustees or in the instrument governing such

trust shall not be deemed a change in beneficiary.

               (b)  No designation, revocation, or change of

beneficiaries shall be valid and effective unless and until filed

with the Committee.

               (c)  A Participant who does not establish to the

satisfaction of the Committee that he has no spouse may not

designate someone other than his spouse to be his beneficiary

unless:

                    (1)  (A)  such spouse (or the spouse's legal

guardian if the spouse is legally incompetent) executes a written

instrument whereby such spouse consents not to receive such

benefit and consents either:

                              (i)  to the specific beneficiary or

beneficiaries designated by the Participant; or

                             (ii)  to the Participant's right to

designate any beneficiary without further consent by the spouse;

                         (B)  such instrument acknowledges the

effect of the election to which the spouse's consent is being

given; and

                         (C)  such instrument is witnessed by a

Plan representative or notary public;

                    (2)  the Participant:

                         (A)  establishes to the satisfaction of

the Committee that his spouse cannot be located; or

                         (B)  furnishes a court order to the

Committee establishing that the Participant is legally separated

or has been abandoned (within the meaning of local law), unless a

qualified domestic relations order pertaining to such Participant

provides that the spouse's consent must be obtained; or

                    (3)  the spouse has previously given consent

in accordance with this Subsection and consented to the

Participant's right to designate any beneficiary without further

consent by the spouse.

The consent of a spouse in accordance with this Subsection (c)

shall not be effective with respect to other spouses of the

Participant prior to the Participant's Benefit Commencement Date,

and an election to which Paragraph (2) of this Subsection (c)

applies shall become void if the circumstances causing the

consent of the spouse not to be required no longer exist prior to

the Participant's Benefit Commencement Date.

               (d)  If a Participant has no beneficiary under

Subsection (a) of this Section, if the Participant's

beneficiary(ies) predecease the Participant, or if the

beneficiary(ies) cannot be located by the Committee, the interest

of the deceased Participant shall be paid to the Participant's

estate.

       .1   Transfer of Account to Other Plan.

               (a)  Effective January 1, 1993, if (1) a

Participant entitled to receive a distribution from the Plan,

either pursuant to this Article or pursuant to Article VIII, or

(2) the spouse or former spouse of a Participant who is entitled

to receive a distribution from the Plan pursuant to a qualified

domestic relations order, directs the Committee to have the

Trustee transfer all or a portion (not less than $500) of the

amount to be distributed directly to:

                    (1)  an individual retirement account

described in section 408(a) of the Code,

                    (2)  an individual retirement annuity

described in section 408(b) of the Code (other than an endowment

contract),

                    (3)  a qualified defined contribution

retirement plan described in section 401(a) of the Code the terms

of which permit the acceptance of rollover contributions, or

                    (4)  an annuity plan described in section

403(a),

all or a portion (not less than $500) of the amount to be

distributed shall be so transferred.

               (b)  In addition, if a Participant's surviving

spouse is entitled to receive a distribution from the Plan under

Section 5.3, and such surviving spouse directs the Committee to

have the Trustee transfer all or a portion (not less than $500)

of the amount to be distributed directly to:

                    (1)  an individual retirement account

described in section 408(a) of the Code, or

                    (2)  an individual retirement annuity

described in section 408(b) of the Code (other than an endowment

contract),

all or a portion (not less than $500) of the amount to be

distributed shall be so transferred.

               (c)  The Participant, spouse or former spouse must

specify the name of the plan to which the Participant, spouse or

former spouse wishes to have the amount transferred, plus such

other information as may be requested by the Committee, on a form

and in a manner prescribed by the Committee.

               (d)  Subsections (a) and (b) shall not apply to

the following distributions:

                    (1)  any distribution of Voluntary

Contributions,

                    (2)  any distribution if the total

distributions paid or payable from the Plan to the same

individual during the same calendar year are reasonably expected

by the Committee to be less than $200,

                    (3)  that portion of any distribution after

the Participant's Required Beginning Date that is required to be

distributed to the Participant by the minimum distribution rules

of section 401(a)(9) of the Code, or

                    (4) such other distributions as may be

exempted by applicable statute or regulation from the

requirements of section 401(a)(31) of the Code.

               (e)  In the event a Participant, spouse or former

spouse fails to specify whether or not all or a portion of the

amount to be distributed should be transferred under this

Section, the amount to be distributed shall be paid to such

Participant, spouse or former spouse.

      .1   Sale of Company Stock Upon Distribution.

               (a)  If a Participant or beneficiary is entitled

to receive a distribution in cash, the Trustee shall (1) purchase

the Participant's or beneficiary's shares of Company Stock at

their fair market value, on the day they are to be delivered, for

the Fund by applying cash not then invested in Company stock, or

(2) effective prior to June 17, 1992, sell such shares on the

over-the-counter market and, effective after June 16, 1992, sell

such shares on the New York Stock Exchange or (3) both.

               (b)  Before any distribution of a Participant's

Account is made pursuant to this Article, any fractional share of

Company Stock allocated to such Account shall be converted to

cash, on the basis of its pro rata share of the price of a whole

share of Company Stock on the Quarterly Status Date coincident

with or next preceding the date of the distribution.

               (c)  Any shares of Company Stock distributed

pursuant to the terms of the Plan shall be subject to such

restrictions on their subsequent transfer as shall be necessary

or appropriate, in the opinion of counsel for the Company and the

Fund, to comply with applicable federal and state securities laws

and may bear appropriate legends evidencing such restrictions.

                           ARTICLE VI

                            VESTING


       .9   Nonforfeitable Amounts.  A Participant shall have a 100%

nonforfeitable interest at all times in his entire Account.

                          ARTICLE VII

              PURCHASE AND VOTING OF COMPANY STOCK


       .1   Purchase of Company Stock.  As soon as practicable following

the close of each month, the Trustee shall place an order with a

broker to purchase, effective prior to June 17, 1992, on the

over-the-counter market, and effective after June 16, 1992, on

the New York Stock Exchange, at prevailing fair market prices, as

many full shares of Company Stock as may be purchased with the

sum of the contributions allocated to the Participants' Accounts

which are to be invested in Company Stock pursuant to Article

XII, less any amount required to meet current expenses of the

Plan, unless, at the Company's direction, such expenses are paid

by one or more of the Participating Companies.  Any cash

remaining after completion of each purchase shall be held by the

Trustee for future purchases.  Purchases shall be made in the

name of the Trustee for the account of the Plan.  Certificates

for shares of Company Stock shall be issued in the Trustee's name

or in the name of the Trustee's nominee, and shall be delivered

to and held by the Trustee or by a recognized depository.

       .2   Participant Voting Direction.  The Trustee shall vote all

shares of Company Stock, including fractional shares, allocated

to a Participant's Account, in the manner directed by the

Participant to whose Account those shares are allocated.

       .3   Voting Procedures.  The Committee shall establish and

maintain a procedure by which Participants shall be timely

notified of their right to direct the voting of Company Stock

allocated to their Account and the manner in which any such

directions are to be conveyed to the Trustee.

       .4   Absence of Participant Voting Direction.  In the absence of

specific instructions from a Participant, the Trustee may vote

Company Stock in its sole discretion, provided that the Trustee

shall not tender Company Stock pursuant to any offering for such

Company Stock unless specifically directed to do so by the

Participant to whose Account the Company Stock is allocated.

                          ARTICLE VIII

                           WITHDRAWALS


       .10  Withdrawals Not Subject to Section 401(k) Restrictions.

               (a)  An Employee or Participant may withdraw, not

more than once during any Plan Year, up to the total value of the

amount in the following Accounts:

                    (1)  his Voluntary Contribution Account; and

                    (2)  his Rollover Account.

               (b)  Withdrawals under this Section shall be

charged against a Participant's Accounts in the following order

of priority:

                    (1)  (A)  the portion of the Participant's

Rollover Account, if any, that consists of the Participant's

employee contributions made before January 1, 1987, if any, less

any amounts previously withdrawn therefrom;

                         (B)  the balance of the Participant's

Rollover Account after the application of Subparagraph (A) of

this Paragraph, if any, less any amounts previously withdrawn

therefrom;

                    (2)  the Participant's Voluntary Contribution

Account, less any amounts previously withdrawn therefrom.

       .11  Withdrawals Subject to Section 401(k) Restrictions.

               (a)  A Participant may withdraw, not more than

once during any Plan Year, under the rules set forth in

Subsections (b) through (e) of this Section, the following

amounts:

                    (1)  his Salary Reduction Account as of

December 31, 1988; plus

                    (2)  the sum of his Salary Reduction

Contributions made after December 31, 1988.

               (b)  A withdrawal under Subsection (a) of this

Section shall be permitted only if the Committee finds that:

                    (1)  it is made on account of immediate and

heavy financial need (as defined in Subsection (c) of this

Section) of the Participant; and

                    (2)  it is necessary (as defined in

Subsection (d) of this Section) to satisfy such immediate and

heavy financial need.

               (c)  A withdrawal under Subsection (a) will be

deemed to be on account of an immediate and heavy financial need

if the Participant requests such withdrawal on account of:

                    (1)  expenses for medical care described in

section 213(d) of the Code and previously incurred by the

Participant, his spouse, or any of the Participant's dependents

(as defined in section 152 of the Code) or necessary for such

individuals to obtain such medical care;

                    (2)  costs directly related to the purchase

(excluding mortgage payments) of a principal residence of the

Participant;

                    (3)  the payment of tuition and related

educational fees for the next 12 months of post-secondary

education for the Participant, his spouse, children, or

dependents (as defined in section 152 of the Code);

                    (4)  the need to prevent the eviction of the

Participant from his principal residence or foreclosure on the

mortgage of his principal residence; or

                    (5)  such other circumstances or events as

may be prescribed by the Secretary of the Treasury or his

delegate.

               (d)  A withdrawal under Subsection (a) shall be

deemed to be necessary if:

                    (1)  the amount of the withdrawal does not

exceed the amount of the Participant's immediate and heavy

financial need, including any amounts necessary to pay any

federal, state or local income taxes or penalties reasonably

anticipated to result from the withdrawal;

                    (2)  the Participant has obtained all

currently permissible distributions (other than hardship

distributions) and non-taxable loans, if any, under this and all

other plans maintained by the Participating Company and all

Affiliated Companies; and

                    (3)  the Participant agrees in writing to be

bound by the rules of Subsection (e).

               (e)  If a Participant withdraws any amount from

his Salary Reduction Account pursuant to Subsection (a), or

withdraws any elective deferrals under any other qualified

retirement plan maintained by the Participating Company or any

Affiliated Company, which other plan conditions such withdrawal

upon the Participant's being subject to rules similar to those

stated in this Subsection and Subsection (d), such Participant:

                    (1)  may not make Salary Reduction

Contributions under this Plan or employee contributions (other

than mandatory contributions under a defined benefit plan) or

elective deferrals under any other qualified or non-qualified

plan of deferred compensation (which does not include any health

or welfare plan, including a health or welfare plan that is part

of a cafeteria plan described in section 125 of the Code)

maintained by the Participating Company or an Affiliated Company

for a period of 12 months commencing on the date of his receipt

of the withdrawal; and

                    (2)  in the calendar year next following the

calendar year of such withdrawal, may not make Salary Reduction

Contributions or elective deferrals under any other qualified

retirement plan maintained by the Participating Company or an

Affiliated Company in excess of:

                         (A)  the dollar amount described in

Subsection (b) of Section 3.1 for such year, minus

                         (B)  the total Salary Reduction

Contributions under this Plan and elective deferrals under any

other qualified plan made by the Participant during the calendar

year of the withdrawal.

       .1   Withdrawals On and After Attainment of Age 59-1/2.  Upon his

attainment of Age 59-1/2, a Participant may withdraw, up to the

total value in his Account, less amounts previously withdrawn

therefrom, by submitting his written request to the Committee.

       .2   Amount and Payment of Withdrawals.  The amount of any

withdrawal will be determined on the basis of the value of the

Participant's Account and the sum of the Participant's Salary

Reduction Contributions valued as of the Valuation Date

coincident with or immediately preceding the date of the

withdrawal.  Payment will be made in cash in a single sum.  If,

in order to make such a cash payment, the Trustee is required to

convert any portion of the Company Stock allocated to a

Participant's Account to cash, the Trustee shall comply with the

procedures set forth in Section 5.10.  Any withdrawal requested

under this Section shall be paid as soon as practicable following

the Committee's determination that the requested withdrawal

complies with the terms and conditions set forth in this Section.

       .3   Pledged Amounts.  No amount that has been pledged as

security for a loan under Article IX may be withdrawn under this

Article.

       .4   Investment Medium to be Charged with Withdrawal.

               (a)  Prior to July 1, 1991, a withdrawal made

pursuant to this Article shall be charged against a Participant's

interest in the various Investment Media in proportion to his

share in such Investment Media.

               (b)  Effective after June 30, 1991 and before

March 1, 1995, except with respect to a Participant's interest in

the Fixed Income Fund, a Participant may specify, in increments

of 25%, to which Investment Medium or Investment Media any

withdrawal under this Article is to be charged.  Unless so

specified, distribution will be made out of the Participant's

interest in the various Investment Media in proportion to the

Participant's share in such Investment Media.

               (c)  Effective after February 28, 1995, a

withdrawal made pursuant to this Article shall be charged against

a Participant's interest in the various Investment Media in

proportion to his share in such Investment Media.

                           ARTICLE IX

                     LOANS TO PARTICIPANTS


       .1   Loan Application.  Each Participant who is an Employee of a

Participating Company may apply for a loan from the Plan.  All

applications shall be made to the Committee on forms which it

prescribes, and the Committee shall rule upon such applications

in a uniform and nondiscriminatory manner in accordance with the

rules and guidelines established in this Article.

       .2   Loan Approval.  A loan shall be made effective as soon as

administratively possible after the date a Participant's loan

request is approved by the Committee.  No more than one

application by a Participant for a loan shall be approved during

any calendar year.

       .3   Amount of Loan.

               (a)  In no event shall a Participant be permitted

to have more than one loan outstanding at any time from this

Plan.  Effective prior to March 1, 1990, the minimum amount of

any loan shall be $500.  Effective after February 28, 1990, the

minimum loan amount shall be $1,000.  In no event shall the loan

amount exceed 50 percent (50%) of the value of the Participant's

Account, to a maximum of $50,000, determined as of the Valuation

Date immediately preceding the date on which the loan application

is received by the Committee; provided however, that the loan

amount shall not exceed the total value of the Participant's

Salary Reduction Account plus the value of his Voluntary

Contribution Account.

               (b)  The amount of any loan, when added to the

amount of a Participant's outstanding loans under the Plan and

all other plans qualified under section 401(a) of the Code which

are sponsored by the Participating Company or any Affiliated

Company shall not exceed the lesser of:

                    (1)  $50,000, reduced by the excess (if any)

of:

                         (A)  the Participant's highest

outstanding balance of loans during the one-year period ending on

the day before the date on which such loan is made to the

Participant, over

                         (B)  the outstanding balance of loans

made to the Participant on the date such loan is made to the

Participant; or

                    (2)  fifty percent (50%) of the value of the

Participant's Account.

               (c)  Loan distributions shall be made in cash.

The Trustee shall follow the procedures provided in Section 5.10

to the extent necessary to convert shares of Company Stock to

cash.

       .12  Terms of Loan.

               (a)  Effective prior to March 1, 1995, the

interest rate on loans shall be equal to the Trustee bank's fixed

rate for direct unsecured loans as of the date of the loan

application.  Effective after February 28, 1995, the interest

rate on loans shall be equal to the prime rate plus one percent

(1%) as of the date of the loan application.  Security for each

loan granted pursuant to this Article shall be, to the extent

necessary, the currently unpledged portion of, first, the

Participant's Voluntary Contribution Account, next, the

Participant's Rollover Account, and, next, the Participant's

Salary Reduction Account.  In no event shall more than fifty

percent (50%) of the Participant's vested Account as of the date

the loan is made be used as security for the loan.  In its sole

discretion, the Committee may require such additional security as

it deems necessary.

               (b)  Each loan shall be evidenced by the

Participant's execution of a personal demand note on such form as

shall be supplied by the Committee.  Each such note shall specify

that, to the extent repayment is not demanded sooner, repayment

shall be included in installments over 12, 24, 36, 48, or 60

months from the date on which the loan is distributed; however,

if the purpose of the loan is to acquire any dwelling unit which

is to be used within a reasonable period of time as the principal

residence of the Participant, the period of repayment may be as

long as, but shall not exceed, 180 months.  All loans from the

Plan shall be non-renewable.  Each note shall also specify the

interest rate as determined by the Committee at the time the loan

is approved.

               (c)  All loans shall be repaid in approximately

equal installments (not less frequently than quarterly) through

payroll deductions or in such other manner as the Committee may

determine.  A Participant may repay the outstanding balance of

any loan in one lump sum at any time by notifying the Committee

of his intent to do so and by forwarding to the Committee payment

in full of the then outstanding balance, plus interest accrued to

the date of payment; provided that a Participant who makes such a

lump sum payment may not apply for another loan from the Plan

until 12 months from the date of his lump sum payment.  The

amount of principal and interest repaid by a Participant shall be

credited to a Participant's Account as each repayment is made.

               (d)  If, and only if:

                    (1)  the Participant dies;

                    (2)  the Participant (other than a

Participant who continues to be a party in interest) has a

Separation from Service;

                    (3)  the Compensation of a Participant who is

an Employee of a Participating Company is discontinued or

decreased below the amount necessary to amortize the loan;

                    (4)  the loan is not repaid by the time the

note matures;

                    (5)  the Participant attempts to revoke any

payroll deduction authorization for repayment of the loan without

the consent of the Committee;

                    (6)  the Participant fails to pay any

installment of the loan when due and the Committee elects to

treat such failure as default;

                    (7)  any other event occurs which the

Committee, in its sole discretion, believes may jeopardize the

repayment of the loan;

before a loan is repaid in full, the unpaid balance thereof, with

interest due thereon, shall become immediately due and payable.

The Participant (or his beneficiary, in the event of the

Participant's death) may satisfy the loan by paying the

outstanding balance of the loan within such time as may be

specified in the note.  If the loan and interest are not repaid

within the time specified, the Committee shall satisfy the

indebtedness from the amount of the Participant's vested interest

in his Account as provided in Section 9.5 before making any

payments otherwise due hereunder to the Participant or his

beneficiary.

       .13  Enforcement.  The Committee shall give written notice to the

Participant (or his beneficiary in the event of the Participant's

death) of an event of default described in Subsection (d) of

Section 9.4.  If the loan and interest are not paid within the

time period specified in the notice, the amount of the

Participant's Voluntary Contribution Account, to the extent such

Account is security for the loan, shall be reduced by the amount

of the unpaid balance of the loan, with interest due thereon, and

the Participant's indebtedness shall thereupon be discharged to

the extent of the reduction.  In addition, if the value of the

Participant's Voluntary Contribution Account pledged as security

for the loan is insufficient to discharge fully the Participant's

indebtedness, the Participant's Salary Reduction Account shall be

used to reduce the Participant's indebtedness at such time as the

Participant is entitled to a distribution under Article V or a

withdrawal under Article VIII from his Salary Reduction Account.

Such action shall not operate as a waiver of the rights of the

Company, the Committee, the Trustee, or the Plan under applicable

law.  The Committee also shall be entitled to take any and all

other actions necessary and appropriate to foreclose upon any

property other than the Participant's Account pledged as security

for the loan or to otherwise enforce collection of the

outstanding balance of the loan.

       .14  Investment Medium to be charged with Loan.

               (a)  Prior to July 1, 1991, a loan made pursuant

to this Article shall be charged against a Participant's interest

in the various Investment Media in proportion to his share in

such Investment Media.

               (b)  Effective after June 30, 1991 and before

March 1, 1995, except with respect to a Participant's interest in

the Fixed Income Fund, a Participant may specify, in increments

of 25%, to which Investment Medium or Investment Media any loan

under this Article is to be charged.  Unless so specified,

distribution will be made out of the Participant's interest in

the various Investment Media in proportion to the Participant's

share in such Investment Media.  At the time a Participant

applies for a loan from the Plan, he shall elect the Investment

Media into which the amount of his loan repayments shall be

deposited.  Such election shall be irrevocable.

               (c)  Effective after February 28, 1995, a loan

made pursuant to this Article shall be charged against a

Participant's interest in the various Investment Media in

proportion to his share in such Investment Media.

       .15  Additional Rules.  The Committee may establish additional

rules relating to Participant loans under the Plan, which rules

shall be applied on a uniform and non-discriminatory basis.

                           ARTICLE X

                         ADMINISTRATION


      .16  Committee.  If the Company designates one or more

individuals as the Committee, the powers and duties of the

Committee under the Plan shall be exercised by the Committee;

otherwise all such powers and duties shall be exercised by the

Company.  The Committee shall be the named fiduciary which shall

control and manage the operation of the Plan and shall administer

the Plan.  The Committee members may, but need not, be Employees,

and they shall serve at the pleasure of the Company.  They shall

be entitled to reimbursement of expenses, but those members of

the Committee who are also Employees of a Participating Company

shall receive no compensation for their service on the Committee.

Any reimbursement of expenses of the Committee members shall be

paid directly by the Company.  The Committee shall be responsible

for the general administration of the Plan under the policy

guidance of the Company.

      .17  Duties and Powers of Committee.  In addition to the duties

and powers described elsewhere hereunder, the Committee shall

have the following specific duties and powers:

               (a)  to retain such consultants, accountants and

attorneys as may be deemed necessary or desirable to render

statements, reports, and advice with respect to the Plan and to

assist the Committee in complying with all applicable rules and

regulations affecting the Plan; any consultants, accountants and

attorneys may be the same as those retained by the Company;

               (b)  to decide appeals under this Article;

               (c)  to enact uniform and nondiscriminatory rules

and regulations to carry out the provisions of the Plan;

               (d)  to resolve questions or disputes relating to

eligibility for benefits or the amount of benefits under the

Plan;

               (e)  to construe and interpret and supply

omissions with respect to the provisions of the Plan;

               (f)  to determine whether any domestic relations

order received by the Plan is a qualified domestic relations

order as provided in section 414(p) of the Code;

               (g)  to evaluate administrative procedures; and

               (h)  to delegate such duties and powers as the

Committee shall determine from time to time to any person or

persons.  To the extent of any such delegation, the delegate

shall have the duties, powers, authority and discretion of the

Committee.

Any decisions and determinations made by the Committee pursuant

to its duties and powers described in the Plan shall be

conclusive and binding upon all parties.  The Committee shall

have sole discretion in carrying out its responsibilities.  The

expenses incurred by the Committee in connection with the

operation of the Plan, including, but not limited to, the

expenses incurred by reason of the engagement of professional

assistants and consultants, shall be expenses of the Plan and

shall be payable from the Fund at the direction of the Committee.

The Participating Companies shall have the option, but not the

obligation, to pay any such expenses, in whole or in part, and,

by so doing, to relieve the Fund from the obligation of bearing

such expenses.  Payment of any such expenses by a Participating

Company on one occasion shall not bind that Participating Company

to pay any similar expenses on any subsequent occasion.

      .18  Functioning of Committee.  The Committee and those persons

or entities to whom the Committee has delegated responsibilities

shall keep accurate records and minutes of meetings,

interpretations, and decisions.  The Committee shall act by

majority vote of the members, and such action shall be evidenced

by a written document.

      .19  Disputes.

               (a)  If the Committee denies, in whole or in part,

a claim for benefits by a Participant or his beneficiary, the

Committee shall furnish notice of the denial to the claimant,

setting forth:

                    (1)  the specific reasons for the denial;

                    (2)  specific reference to the pertinent Plan

provisions on which the denial is based;

                    (3)  a description of any additional

information necessary for the claimant to perfect the claim and

an explanation of why such information is necessary; and

                    (4)  appropriate information as to the steps

to be taken if the claimant wishes to submit his claim for

review.

Such notice shall be forwarded to the claimant within 90 days of

the Committee's receipt of the claim; provided, however, that in

special circumstances the Committee may extend the response

period for up to an additional 90 days, in which event it shall

notify the claimant in writing of the extension, and shall

specify the reason or reasons for the extension.

               (b)  Within 60 days of receipt of a notice of

claim denial, a claimant or his duly authorized representative

may petition the Committee in writing for a full and fair review

of the denial.  The claimant or his duly authorized

representative shall have the opportunity to review pertinent

documents and to submit issues and comments in writing to the

Committee.  The Committee shall review the denial and shall

communicate its decision and the reasons therefor to the claimant

in writing within 60 days of receipt of the petition; provided,

however, that in special circumstances the Committee may extend

the response period for up to an additional 60 days, in which

event it shall notify the claimant in writing prior to the

commencement of the extension.  The appeals procedure set forth

in this Subsection (b) shall be the exclusive means for

contesting a decision denying benefits under the Plan.

      .20  Indemnification.  Each member of the Committee, and any

other person who is an Employee or director of a Participating

Company or an Affiliated Company shall be indemnified and held

harmless by the Company against and with respect to all damages,

losses, obligations, liabilities, liens, deficiencies, costs and

expenses, including without limitation, reasonable attorney's

fees and other costs incident to any suit, action, investigation,

claim or proceedings to which he may be a party by reason of his

performance of administrative functions and duties under the

Plan.  The foregoing right to indemnification shall be in

addition to such other rights as the Committee member or other

person may enjoy as a matter of law or by reason of insurance

coverage of any kind.  Rights granted hereunder shall be in

addition to and not in lieu of any rights to indemnification to

which the Committee member or other person may be entitled

pursuant to the by-laws of the Participating Company.

                           ARTICLE XI

                            THE FUND


      .1   Designation of Trustee.  The Company, by appropriate

resolution of its Board of Directors, if any, shall name and

designate a Trustee and shall enter into a Trust Agreement.  The

Company shall have the power, by appropriate resolution of its

Board of Directors, to amend the Trust Agreement, remove the

Trustee, and designate a successor Trustee, as provided in the

Trust Agreement.  All of the assets of the Plan shall be held by

the Trustee for use in accordance with the Plan.

      .2   Exclusive Benefit.  Prior to the satisfaction of all

liabilities under the Plan in the event of termination of the

Plan, no part of the corpus or income of the Fund shall be used

for or diverted to purposes other than for the exclusive benefit

of Participants and their beneficiaries except as expressly

provided in this Plan and in the Trust Agreement.

      .3   No Interest in Fund.  No person shall have any interest in

or right to any part of the assets or income of the Fund, except

to the extent expressly provided in this Plan and in the Trust

Agreement.

      .4   Trustee.  The Trustee shall be the named fiduciary with

respect to management and control of Plan assets held by it and,

except as provided in Article XII, shall have exclusive and sole

responsibility for the custody and investment thereof in

accordance with the Trust Agreement.

                          ARTICLE XII

                          INVESTMENTS


      .21  Investment of Pre-1994 Matching Contributions, Voluntary

Contributions, Pre-1990 Salary Reduction Contributions and

Pre-1990 Rollover Contributions.

               (a)  All Pre-1994 Matching Contributions,

Voluntary Contributions, Pre-1990 Salary Reduction Contributions

and Pre-1990 Rollover Contributions allocated to a Participant's

Account shall be invested in Company Stock.  Notwithstanding the

foregoing, a Participant who attains Age 55 may, not more than

once during any Plan Year, direct the Trustee to sell a portion

of the Age 55 Shares allocated to his Voluntary Contribution

Account, Pre-1994 Matching Contribution Subaccount, Pre-1990

Salary Reduction Subaccount and Pre-1990 Rollover Subaccount and

transfer the proceeds to any other Investment Medium selected by

the Participant.  The portion transferred shall be expressed in

whole percentages of his Age 55 Shares and shall be transferred

in equal portions from his Pre-1994 Matching Contribution

Subaccount, Voluntary Contribution Account, Pre-1990 Salary

Reduction Subaccount and Pre-1990 Rollover Subaccount.  The

cumulative number of Age 55 Shares transferred shall not exceed

the following percentages during the Plan Years in which the

Participant attains the following ages:

               Age Attained             Percentage of
               in Plan Year             Age 55 Shares

                    55                       40%

                    56                       60%

                    57                       80%

                    58                      100%

               (b)  Prior to March 1, 1995, a direction to the

Trustee pursuant to Subsection (a) of this Section shall be

effective as of any Quarterly Status Date if made in writing at

least 15 days prior to such Quarterly Status Date, and the

Trustee shall sell the affected Company Stock and transfer the

proceeds as of such Quarterly Status Date.  After

February 28, 1995, such investment direction may be made on any

day of any calendar month and shall become effective as soon as

administratively possible after receipt of the direction by the

Committee, in accordance with rules established by the Committee

for this purpose.

               (c)  Effective as of any Payroll Period beginning

after a Participant attains Age 55, a Participant may elect, in

the manner prescribed by the Committee, to have any portion of

Pre-1990 Salary Reduction Contributions and Pre-1994 Matching

Contributions that will be allocated to his Account after he

attains Age 55 invested in any other Investment Medium selected

by the Participant.  Such an election shall be irrevocable.

               (d)  Notwithstanding Subsections (a) - (c) of this

Section, effective on each June 1, September 1, January 1 and

March 1, commencing on June 1, 1990 and ending on

September 1, 1994, a Participant may elect to transfer up to 20%

of the value of the Company Stock allocated to his Voluntary

Contribution Account, Pre-1990 Salary Reduction Subaccount and

Pre-1990 Rollover Subaccount to any Investment Medium selected by

the Participant; provided, that, such election is made at least

15 days prior to the effective date of the transfer and no more

than one transfer may be made in any Plan Year.  The Company

Stock remaining in a Participant's Voluntary Contribution

Account, Pre-1990 Salary Reduction Subaccount and Pre-1990

Rollover Subaccount after August 31, 1994 may not be transferred

to any other Investment Medium until the Participant attains Age

55 and makes a transfer of Age 55 Shares pursuant to Subsection

(a) of this Section 12.1.

               (e)  A Participant may elect to invest Pre-1994

Matching Contributions allocated to his Account after

February 28, 1993 in Company common or preferred stock, as

provided in Subsection (b) of Section 3.4.

      .22  Investment of Post-1989 Salary Reduction Contributions,

Post-1989 Rollover Contributions and Post-1993 Matching

Contributions.

               (a)  The Trustee shall invest Post-1989 Salary

Reduction Contributions, Post-1989 Rollover Contributions and

Post-1993 Matching Contributions paid to it and income thereon in

such Investment Media as each Participant may select in

accordance with this Section.  Such investments acquired in the

manner prescribed by the Plan shall be held by or for the

Trustee.  Prior to March 1, 1995, a Participant may select the

Investment Media in which his Post-1989 Salary Reduction

Contributions, Post-1989 Rollover Contributions and Post-1993

Matching Contributions shall be deposited, effective on any

September 1, December 1, March 1 or June 1; provided, that, the

Committee receives notice of such investment selection by the

fifteenth day of the month prior to the effective date of the

selection.  Effective after February 28, 1995, a Participant may

select the Investment Media in which his Post-1989 Salary

Reduction Contributions, Post-1989 Rollover Contributions and

Post-1993 Matching Contributions shall be deposited on any day of

any calendar month, provided that a Participant may make only one

selection in any calendar month.  Such selection shall be

effective as soon as administratively possible after receipt of

notice of the selection by the Committee.

               (b)  A Participant shall select one or more of the

Investment Media in which his Account shall be invested, and the

percentage thereof, that shall be invested in each Investment

Medium selected, provided that prior to March 1, 1995, such

percentage shall be selected in multiples of 25%.  In the event a

Participant fails to make an election pursuant to this Section,

amounts allocated to his Account shall be invested in the most

conservative of the Investment Media as determined by the

Committee.  A Participant may amend such selection by prior

notice to the Committee, effective as of such dates determined by

the Committee, by giving prior notice to the Committee.  Such

amendments will be subject to the other requirements of this

Section.

               (c)  Prior to March 1, 1995, a Participant may

transfer such portion of the value of his existing interest in

any Investment Medium to another Investment Medium effective on

any Quarterly Status Date, provided that the Committee receives

notice of such transfer by the fifteenth day of the month prior

to the Quarterly Status Date.

               (d)  After February 28, 1995, a Participant may

transfer such portion of the value of his existing interest in

any Investment Medium to another Investment Medium effective on

any day of any calendar month, provided that a Participant may

make only one such transfer in a calendar month.

      .23  Investment Media.  Prior to March 1, 1990, the only

Investment Media available under the Plan shall be (a) Company

Stock, and (b) the Fixed Income Fund in which only Age 55 Shares

may be invested.  After February 28, 1990, the Plan shall make

available such Investment Media as the Committee shall, from time

to time, determine and communicate to Participants.

      .24  Additional Rules.

               (a)  The amounts contributed by all Participants

to each Investment Medium shall be commingled for investment

purposes.

               (b)  The Trustee may hold assets of the Fund and

make distributions therefrom in the form of cash without

liability for interest, if for administrative purposes it becomes

necessary or practical to do so.

                          ARTICLE XIII

              AMENDMENT OR TERMINATION OF THE PLAN


      .25  Power of Amendment and Termination.

               (a)  It is the intention of each Participating

Company that this Plan will be permanent.  However, each

Participating Company reserves the right to terminate its

participation in this Plan at any time by or pursuant to action

of its board of directors or other governing body.  Furthermore,

the Company reserves the power to amend or terminate the Plan at

any time by or pursuant to action of the Board of Directors.

               (b)  Each amendment to the Plan shall be binding

on each Participating Company if such Participating Company, by

or pursuant to action of its board of directors or other

governing body:

                    (1)  consents to such amendment at any time;

or

                    (2)  fails to object thereto within thirty

days after receiving notice thereof.

               (c)  Any amendment or termination of the Plan

shall become effective as of the date designated by the Board of

Directors or its delegate.  Except as expressly provided

elsewhere in the Plan, prior to the satisfaction of all

liabilities with respect to the benefits provided under this

Plan, no amendment or termination shall cause any part of the

monies contributed hereunder to revert to the Participating

Companies or to be diverted to any purpose other than for the

exclusive benefit of Participants and their beneficiaries.  Upon

termination of the plan without establishment or maintenance of

another defined contribution plan (other than an employee stock

ownership plan as defined in section 4975(e)(7) of the Code or a

simplified employee pension plan as defined in section 408(k) of

the Code), Accounts shall be distributed in accordance with

applicable law.

      .26  Merger.  The Plan shall not be merged with or consolidated

with, nor shall its assets be transferred to, any other qualified

retirement plan unless each Participant would receive a benefit

after such merger, consolidation, or transfer (assuming the Plan

then terminated) which is of actuarial value equal to or greater

than the benefit he would have received from his Account if the

Plan had been terminated on the day before such merger,

consolidation, or transfer.  No amounts shall be transferred to

this Plan which would cause the Plan to be a direct or indirect

transferee of a plan to which the joint and survivor annuity and

pre-retirement survivor annuity requirements of sections

401(a)(11) and 417 of the Code apply.

                          ARTICLE XIV

                      TOP-HEAVY PROVISIONS


      .27  General.  The following provisions shall apply automatically

to the Plan and shall supersede any contrary provisions for each

Plan Year in which the Plan is a Top-Heavy Plan (as defined

below).  It is intended that this Article shall be construed in

accordance with the provisions of section 416 of the Code.

      .28  Definitions.  The following definitions shall supplement

those set forth in Article I of the Plan:

               (a)  "Aggregation Group" means this plan and each

other qualified retirement plan (including a frozen plan or a

plan which has been terminated during the 60-month period ending

on the Determination Date) of a Participating Company or an

Affiliated Company:

                    (1)  in which a Key Employee is a

participant; or

                    (2)  which enables any plan in which a Key

Employee participates to meet the requirements of sections

401(a)(4) or 410 of the Code; or

                    (3)  without the inclusion of which, the

plans in the Aggregation Group would be Top-Heavy Plans, but,

with the inclusion of which, the plans in the Aggregation Group

are not Top-Heavy Plans and, taken together, meet the

requirements of sections 401(a)(4) and 410 of the Code.

               (b)  "Determination Date" means, for any Plan

Year, the last day of the preceding Plan Year.

               (c)  "Key Employee" means, with respect to any

Plan Year:

                    (1)  any Employee or former Employee who at

any time during the 60-month period ending on the Determination

Date was:

                         (A)  an officer of a Participating

Company having Compensation for a Plan Year during such period

greater than fifty percent (50%) of the amount in effect under

section 415(b)(1)(A) of the Code for the calendar year in which

such Plan Year ends; provided, that no more than 50 Employees

(or, if less, the greater of three Employees or ten percent (10%)

of the greatest number of Employees employed by all Participating

Companies and all Affiliated Companies during such 60-month

period, but excluding employees described in section 414(q)(8) of

the Code) shall be treated as officers; or

                         (B)  one of the 10 Employees having

Compensation greater than the amount described in section

415(c)(1)(A) of the Code and owning (or are considered as owning,

within the meaning of section 318 of the Code) the largest

interests in any Participating Company or Affiliated Company,

provided that such interest exceeds one-half of one percent

(0.5%) of the total share ownership of the Participating Company

or Affiliated Company, the total number of individuals described

in this Subparagraph (B) being limited to 10 for the entire

60-month period; or

                         (C)  a five-percent (5%) owner of a

Participating Company; or

                         (D)  a one-percent (1%) owner of a

Participating Company having Compensation in excess of $150,000;

or

                    (2)  a beneficiary of an individual described

in Paragraph (1) of this Subsection.

For purposes of this Subsection, Compensation shall include

elective deferrals under sections 125, 402(a)(8), 402(h) and

403(b) of the Code.  Determinations under this Subsection shall

be made in accordance with section 416(i) of the Code.

               (d)  "Key Employee Ratio" means, for any

Determination Date, the ratio of the amount described in

Paragraph (1) of this Subsection to the amount described in

Paragraph (2) of this Subsection, after deducting from each such

amount any portion thereof described in Paragraph (3) of this

Subsection, where:

                    (1)  the amount described in this Paragraph

is the sum of:

                         (A)  the present value of all accrued

benefits of Key Employees under all qualified defined benefit

plans included in the Aggregation Group;

                         (B)   the balances in all of the

accounts of Key Employees under all qualified defined

contribution plans included in the Aggregation Group; and

                         (C)  the amounts distributed from all

plans in such Aggregation Group to or on behalf of any Key

Employee during the period of five Plan Years ending on the

Determination Date, except any benefit paid on account of death

to the extent it exceeds the accrued benefits or account balances

immediately prior to death;

                    (2)  the amount described in this Paragraph

is the sum of:

                         (A)  the present value of all accrued

benefits of all participants under all qualified defined benefit

plans included in the Aggregation Group;

                         (B)  the balances in all of the accounts

of all participants under all qualified defined contribution

plans included in the Aggregation Group; and

                         (C)  the amounts distributed from all

plans in such Aggregation Group to or on behalf of any

participant during the period of five Plan Years ending on the

Determination Date; and

                    (3)  the amount described in this Paragraph

is the sum of:

                         (A)  all rollover contributions (or fund

to fund transfers) to the Plan by an Employee after

December 31, 1983 from a plan sponsored by an employer which is

not a Participating Company or an Affiliated Company;

                         (B)  any amount that is included in

Paragraphs (1) and (2) of this Subsection for a person who is a

Non-Key Employee as to the Plan Year of reference but who was a

Key Employee as to any earlier Plan Year; and

                         (C)  for Plan Years beginning after

December 31, 1984, any amount that is included in Paragraphs (1)

and (2) of this Subsection for a person who has not performed any

services for any Participating Company during the five-year

period ending on the Determination Date.

The present value of accrued benefits under any defined benefit

plan shall be determined on the basis of the actuarial

assumptions used by such defined benefit plan under the method

used for accrual purposes for all plans maintained by all

Participating Companies and Affiliated Companies if a single

method is used by all such plans, or, otherwise, the slowest

accrual method permitted under section 411(b)(1)(C) of the Code.

               (e)  "Non-Key Employee" means, for any Plan Year:

                    (1)  an Employee or former Employee who is

not a Key Employee with respect to such Plan Year; or

                    (2)  a beneficiary of an individual described

in Paragraph (1) of this Subsection.

               (f)  "Super Top-Heavy Plan" means, for any Plan

Year, each plan in the Aggregation Group for such Plan Year if,

as of the applicable Determination Date, the Key Employee Ratio

exceeds ninety percent (90%).

               (g)  "Top-Heavy Compensation" means, for any

Participant for any Plan Year, the average of his annual

Compensation over the period of five consecutive Plan Years (or,

if shorter, the longest period of consecutive Plan Years during

which the Participant was in the employ of any Participating

Company) yielding the highest average, disregarding:

                    (1)  Compensation for Plan Years ending prior

to January 1, 1984; and

                    (2)  Compensation for Plan Years after the

close of the last Plan Year in which the Plan was a Top-Heavy

Plan.

               (h)  "Top-Heavy Plan" means, for any Plan Year,

each plan in the Aggregation Group for such Plan Year if, as of

the applicable Determination Date, the Key Employee Ratio exceeds

sixty percent (60%).

               (i)  "Year of Top-Heavy Service" means, for any

Participant, a Plan Year in which he completes 1,000 or more

Hours of Service, excluding:

                    (1)  Plan Years commencing prior to

January 1, 1984; and

                    (2)  Plan Years in which the Plan is not a

Top-Heavy Plan.

      .29  Minimum Contribution for Non-Key Employees.

               (a)  In each Plan Year in which the Plan is a

Top-Heavy Plan, each Eligible Employee who is a Non-Key Employee

(except an Eligible Employee who is a Non-Key Employee as to the

Plan Year of reference but who was a Key Employee as to any

earlier Plan Year) and who is an Employee on the last day of such

Plan Year will receive a total minimum Participating Company or

Affiliated Company contribution (including forfeitures) under all

plans described in Paragraphs (a)(1) and (a)(2) of Section 14.2

of not less than three percent (3%) of the Eligible Employee's

Compensation for the Plan Year.  Elective deferrals to such plans

made on behalf of a Participant in plan years beginning after

December 31, 1984 but before January 1, 1989 shall be deemed to

be Company contributions for the purpose of this Subsection.

Elective deferrals and employer matching contributions to such

plans in plan years beginning on or after January 1, 1989 shall

not be used to meet the minimum contribution requirements of this

Subsection.

               (b)  The percentage set forth in Subsection (a)

shall be reduced to the percentage at which contributions,

including forfeitures, are made (or are required to be made) for

a Plan Year for the Key Employee for whom such percentage is the

highest for that Plan Year.  This percentage shall be determined

for each Key Employee by dividing the contribution for such Key

Employee by his Compensation for the Plan Year.  All defined

contribution plans required to be included in an Aggregation

Group shall be treated as one plan for the purpose of this

Section; however, this Section shall not apply to any plan which

is required to be included in the Aggregation Group if such plan

enables a defined benefit plan in the group to meet the

requirements of section 401(a)(4) or section 410 of the Code.

               (c)  If a Non-Key Employee described in

Subsection (a) participates in both a defined benefit plan and a

defined contribution plan described in Paragraphs (a)(1) and

(a)(2) of Section 14.2, the Participating Company is not required

to provide such Employee with both the minimum benefit under the

defined benefit plan and the minimum contribution.  In such

event, the Non-Key Employee shall not receive the minimum

contribution described in this Section if he has the minimum

benefit required by section 416 of the Code under the defined

benefit Top-Heavy Plan.

      .30  Social Security.  The Plan, for each Plan Year in which it

is a Top-Heavy Plan, must meet the requirements of this Article

without regard to any Social Security or similar contributions or

benefits.

      .31  Adjustment to Maximum Benefit Limitation.

               (a)  For each Plan Year in which the Plan is (1) a

Super Top-Heavy Plan or (2) a Top-Heavy Plan and the Board of

Directors does not make the election to amend the Plan to provide

the minimum contribution described in Subsection (c), the 1.25

factor in the defined benefit and defined contribution fractions

described in Subsection (c) of Section 3.9 shall be reduced to

1.0.  The adjustment described in this Subsection shall not apply

to a Participant during any period in which the Participant earns

no additional accrued benefit under any defined benefit plan and

has no employer contributions, forfeitures, or voluntary

nondeductible contributions allocated to his accounts under any

defined contribution plan.

               (b)  In the case of any Top-Heavy Plan to which

Subsection (e) of Section 3.9 applies, "$41,500" shall be

substituted for "$51,875" in the calculation of the numerator of

the transition fraction.

               (c)  If, in any Plan Year in which the Plan is a

Top-Heavy Plan but not a Super Top-Heavy Plan, the Aggregation

Group also includes a defined benefit plan, the Board of

Directors may elect to use a factor of 1.25 in computing the

denominator of the defined benefit and defined contribution

fractions described in Section 3.9.  In the event of such

election, the minimum contribution described in Section 14.3(a)

for each Non-Key Employee who is not covered under a defined

benefit plan shall be increased to four percent (4%), and the

minimum Company contribution described in Section 14.3(c) for

each Non-Key Employee who is covered under a defined benefit plan

(but who does not have a minimum benefit under the defined

benefit plan equal to the lesser of (1) three percent (3%) of his

Top-Heavy Compensation multiplied by his Years of Top-Heavy

Service or (2) thirty-percent (30%) of his Top-Heavy

Compensation) shall be increased to seven and one-half percent

(7-1/2%).

                           ARTICLE XV

                     ROLLOVER CONTRIBUTIONS


      .32  Rollover Contributions.

               (a)  Subject to the restrictions set forth in

Subsection (b), a Covered Employee may transfer or have

transferred directly to the Fund, from any qualified retirement

plan of a former employer, all or a portion of his interest in

the distributing plan.  In addition, a Covered Employee who has

established an individual retirement account to hold

distributions received from qualified retirement plans of former

employers may transfer all of the assets of such individual

retirement account to the Fund.  Such individual retirement

account shall not contain nondeductible contributions made by the

Employee while he was a participant in such plans.

               (b)  The Trustee shall not accept a distribution

from any other qualified retirement plan or from an individual

retirement account unless the following conditions are met:

                    (1)  (A)  the distribution being transferred

must come directly from the fiduciary of the plan of the former

employer, or

                         (B)  it must come from the Employee

within 60 days after the Employee receives a distribution from

such other qualified retirement plan or individual retirement

account and must comply with the provisions of section 402(c),

403(a)(4), or 408(d)(3) of the Code, whichever applies;

                    (2)  distributions from a plan for a

self-employed person shall not be transferred to this Plan,

unless the transfer is directly to the Fund from the funding

agent of the distributing plan;

                    (3)  the interest being transferred shall not

include assets from any plan to the extent that the Committee

determines that the transfer of such interest (A) would impose

upon this Plan requirements as to form of distribution that would

not otherwise apply hereunder, (B) would otherwise result in the

elimination of Code section 411(d)(6) protected benefits, or (C)

would cause the Plan to be a direct or indirect transferee of a

plan to which the joint and survivor annuity requirements of

sections 401(a)(11) and 417 of the Code apply; and

                    (4)  the interest being transferred shall not

contain nondeductible contributions made to the distributing plan

by the Employee unless the transfer to the Fund is directly from

the funding agent of the distributing plan.

      .33  Vesting and Distribution of Rollover Account.

               (a)  The distributions transferred by or for a

Covered Employee from another qualified retirement plan or from

an individual retirement account shall be credited to the

Employee's Rollover Account.  An Employee shall be fully vested

at all times in his Rollover Account

               (b)  An Employee's Rollover Account shall be

distributed as otherwise provided under the Plan.

                          ARTICLE XVI

                       GENERAL PROVISIONS


      .1   No Employment Rights.  Neither the action of the Company in

establishing the Plan, nor of any Participating Company in

adopting the Plan, nor any provisions of the Plan, nor any action

taken by the Company, any Participating Company or the Committee

shall be construed as giving to any Employee the right to be

retained in the employ of the Company or any Participating

Company, or any right to payment except to the extent of the

benefits provided in the Plan to be paid from the Fund.

      .2   Governing Law.  Except to the extent superseded by ERISA,

all questions pertaining to the validity, construction, and

operation of the Plan shall be determined in accordance with the

laws of the state in which the principal place of business of the

Company is located.

      .3   Severability of Provisions.  If any provision of this Plan

is determined to be void by any court of competent jurisdiction,

the Plan shall continue to operate and, for the purposes of the

jurisdiction of that court only, shall be deemed not to include

the provisions determined to be void.

      .4   No Interest in Fund.  No person shall have any interest in,

or right to, any part of the principal or income of the Fund,

except as and to the extent expressly provided in this Plan and

in the Trust Agreement.

      .5   Spendthrift Clause.  No benefit payable at any time under

this Plan and no interest or expectancy herein shall be

anticipated, assigned, or alienated by any Participant or

beneficiary, or subject to attachment, garnishment, levy,

execution, or other legal or equitable process, except for (1) a

Federal tax levy made pursuant to section 6331 of the Code and

(2) any benefit payable pursuant to a qualified domestic

relations order.  Any attempt to alienate or assign a benefit

hereunder, whether currently or hereafter payable, shall be void.

      .6   Incapacity.  If the Committee deems any Participant who is

entitled to receive payments hereunder incapable of receiving or

disbursing the same by reason of Age, illness, infirmity, or

incapacity of any kind, the Committee may direct the Trustee to

apply such payments directly for the comfort, support, and

maintenance of such Participant, or to pay the same to any

responsible person caring for the Participant who is determined

by the Committee to be qualified to receive and disburse such

payments for the Participant's benefit; and the receipt of such

person shall be a complete acquittance for the payment of the

benefit.  Payments pursuant to this Section shall be complete

discharge to the extent thereof of any and all liability of the

Participating Companies, the Committee, the Trustee and the Fund.

      .7   Withholding.  The Committee and the Trustee the shall have

the right to withhold any and all state, local, and Federal taxes

which may be withheld in accordance with applicable law.

      .8   Missing Persons.  Neither the Trustee nor any Participating

Company shall be obliged to search for or ascertain the

whereabouts of any individual entitled to benefits under the

Plan.  Any individual entitled to benefits under the Plan who

does not file a timely claim for his benefits will be allowed to

file a claim at any later date, and payment of his benefits will

commence after that later date, except that, in the event the

Participating Company is satisfied that a Participant has no

spouse or that a Participant's spouse cannot be located (as

described in Section 5.8), and the Participant is in fact married

or the spouse is later located, whichever is applicable, such

spouse shall not be deemed an individual entitled to benefits

under the Plan.

          Executed this ____ day of _________________, 1996.


                                   WESTMORELAND COAL COMPANY


[SEAL]                             By:___________________________
                                        [Title]


Attest:________________________
               Secretary
                                   WESTMORELAND RESOURCES, INC.


[SEAL]                             By:___________________________
                                        [Title]


Attest:________________________
               Secretary


<PAGE>
                        AMENDMENT  NO. 1
                             TO THE
                  WESTMORELAND COAL COMPANY AND
     AFFILIATED COMPANIES EMPLOYEES SAVINGS/RETIREMENT PLAN
                                
                                
              Resolutions of the Board of Directors
                  of Westmoreland Coal Company
                                
     WHEREAS, Westmoreland Coal Company (the "Company") adopted

the Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, Effective October 1, 1957, and renamed such

plan the Westmoreland coal Company and  Affiliated Companies

Employees' Savings/Retirement Plan ( the "Plan"), effective March

1, 1990; and

     WHEREAS,  the Plan has been amended from time  to time and

was most recently amended and restated effective September 1,

1987; and

     WHEREAS, Westmoreland Energy, Inc. is a Participating

Company under the Plan; and

     WHEREAS, Westmoreland Energy, Inc. acquired the Corona

Engineering and Consulting Division of OESI  Power Corporation,

effective October 1, 1995; and

     WHEREAS, the Company desires to amend the Plan to provide

for the participation of employees of the Corona Engineering and

Consulting Division of OESI Power Corporation who, as a result of

the acquisition, became employees of the Corona

Division of Westmoreland Energy, Inc. on October 1, 1995;

     NOW, THEREFORE, BE IT RESOLVED, that effective October 1,

1995, the Plan is amended to read as follows:

     1.   The following definition shall be added to Article I of
the Plan:
          ""Corona Participant" means any Participant who was an
          employee of the Corona Engineering and Consulting
          Division of OESI Power Corporation on September 30,
          1995 and became an employee of the Corona Division of
          Westmoreland Energy, Inc. on October 1, 1995."

     2.   The following Paragraph (3) shall be added to the end
of Section 3.4 (a) of the Plan:

     "(3) Notwithstanding Paragraph (2) of this Section 3.4 (a),
effective October 1,     1995, a Participating Company shall
contribute to the Fund for each Plan year an      amount equal to
100% of Corona Participants' Salary Reduction Contributions for
such Plan Year not in excess of seven percent (7%) of each Corona
Participant's  Compensation, offset by the amount, if any, of
Matching Contributions forfeited   during such Plan Year,
provided that such contributions may be prospectively  limited as
provieded in Section 3.8 and provided further that the
contribution   under this Section for any Plan year shall not
cause the  total contributions by the   Participating Company to
exceed the maximum allowable current deduction    Matching
contributions shall be credited to the Participants in proportion
to their  Salary    Reduction contributions for the Plan Year not
in Employee's  Compensation."

     3.   The following Subsection (e) shall be added to the end
of Section 2.2 of the Plan:

     "(e)  Notwithstanding any provision of the Plan to the
contrary, each Covered   Employee who was an employee of the
Corona Engineering  and  Consulting     Division of OESI Power
Corporation on September 30, 1995 and became an   employee of the
Corona  Division of Westmoreland Energy, Inc. on October 1,
1995 shall be credited with Hours of Service for purposes of
Subsection (b) of this   Section by taking into account his
service with the Corona Engineering and      Consulting Division
of OESI Power Corporation prior to October 1, 1995."
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Registration No. 333-

               SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C.  20549

                            FORM S-8
                     REGISTRATION STATEMENT
                UNDER THE SECURITIES ACT OF 1933
                --------------------------------

                   Westmoreland Coal Company
                    -------------------------
     (Exact name of registrant as specified in its charter)

            Delaware                              23-1128670
--------------------------------               -----------------
(State or other jurisdiction of                I.R.S. Employer
incorporation or organization)                 Identification No.

               14th Floor, 2 North Cascade Avenue
                Colorado Springs, Colorado 80903
                          719-442-2600
 (Address and Telephone Number of Principal Executive Offices)

                   Westmoreland Coal Company
                              And
                      Affiliated Companies
               Employees' Savings/Retirement Plan
                    (Full title of the plan)

                     Christopher K. Seglem
        President, Chief Executive Officer and Director
               14th Floor, 2 North Cascade Avenue
                Colorado Springs, Colorado 80903
            (Name and address of agent for service)

                          719-442-2600
 (Telephone number, including area code, of agent for service)

                        with a copy to:
  Paul W. Durham, Esquire                Rhonda R. Cohen, Esquire
  Assistant General Counsel              Ballard Spahr Andrews & Ingersoll
  Westmoreland Coal Company              1735 Market Street, 51st Floor  
  14th Floor, 2 North Cascade Avenue     Philadelphia, Pennsylvania
  Colorado Springs, Colorado                           19103-7599
                    80908                (215) 665-8500
  (719) 448-5807
CALCULATION OF REGISTRATION FEE
                --------------------------------

-----------------------------------------------------------------
                           Proposed     Proposed
Title of                   Maximum      Maximum
Securities     Amount      Offering     Aggregate   Amount of
to be          to be       Price Per    Offering    Registration
Registered (1) Registered  Share(2)     Price(2)    Fee
-----------------------------------------------------------------

Common Stock,
par value $2.50
per share(3)

               325,000 shs. $ 1-3/32     $ 355,469  $ 108

Depository Shares,
each representing
a one-quarter share of
Series A Convertible
Exchangeable Preferred
Stock, par value $0.25
per Depository Share

                 7,000 shs. $ 5-5/16     $ 37,188   $ 12

-----------------------------------------------------------------

1)   In addition, pursuant to Rule 416(c) under the Securities
  Act of 1933, this registration statement also covers an
  indeterminate amount of interests to be offered or sold pursuant
  to the employee benefit plan described herein.

2)   Calculated in accordance with Rule 457(c) and (h), on the
  basis of the average of the bid and asked prices of Westmoreland
  Coal Company Common Stock on July 28, 1997, $1-3/32, and on the
  basis of the average of the bid and asked prices of Westmoreland
  Coal Company Depository Shares on July 28, 1997, $5-5/16, as
  reported on the Over-The-Counter Bulletin Board.

3)   Each share of Westmoreland Coal Company Common Stock offered
  hereby will be accompanied by one Preferred Stock Purchase Right.
WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS

                                                            
     This document constitutes part of a Prospectus covering
         securities that have been registered under the
               Securities Act of 1933, as amended.
                                
                                                             
                                
                                
  THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
     UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
      REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
                                                        
                                
           This document is dated as of July 30, 1997.
WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS

INTRODUCTION                                                    1

GENERAL PLAN INFORMATION                                        2

HOW THE PLAN WORKS                                              3
          Purpose of Plan                                       3
          The Plan in Brief                                     3
          Who to Contact for More Information                   4

WHO MAY PARTICIPATE IN THE PLAN                                 4

CONTRIBUTIONS TO THE PLAN                                       5
          Employee Contributions                                5
          Employer Contributions                                7
          Valuation and Account Statements                      7
          Types of Accounts                                     7
          Limits on Your Contributions                          7

VESTING                                                         8

INVESTING YOUR ACCOUNT                                          8
          Investment Options                                    8
          Your Investment Responsibilities                      9
          The Plan's Responsibilities                          10
          Investment in Company Stock                          11
          Keeping Track of Your Investments                    12

DISTRIBUTIONS FROM THE PLAN                                    13
          Distributions upon Separation from Service           13
          Distributions Upon Reaching Age 70-1/2               13
          Timing of Distribution                               13
          Form of Distribution                                 14
          Withdrawals of Your Account                          14
          Loans During Employment                              15

TAX TREATMENT OF DISTRIBUTIONS                                 16
BENEFICIARY DESIGNATION                                        17

AMENDMENT OR TERMINATION OF THE PLAN                           18

PLAN INSURANCE DOES NOT APPLY                                  18

GENERAL PROVISIONS                                             18
          Assignment of Benefits                               18
          Top-heavy Benefits                                   18
          Claim for Benefits                                   18
          Denial of Claim for Benefits                         18

YOUR RIGHTS UNDER ERISA                                        19

AVAILABLE INFORMATION                                          20

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE                21

APPENDIX A - AVAILABLE INVESTMENT OPTIONS                     A-1

APPENDIX B - DESCRIPTION OF COMPANY PREFERRED STOCK,          B-1
     REPRESENTED BY DEPOSITORY SHARES
WESTMORELAND COAL COMPANY
                              AND
                      AFFILIATED COMPANIES
               EMPLOYEES' SAVINGS/RETIREMENT PLAN

            SUMMARY PLAN DESCRIPTION AND PROSPECTUS

                         INTRODUCTION

          This booklet is a summary of your benefits currently
provided under the Westmoreland Coal Company and Affiliated
Companies Employees' Savings/Retirement Plan ("the Plan").
Westmoreland Coal Company (the "Company") and certain
participating affiliated companies adopted the Plan for you and
other employees to help you build financial resources for the
future.  Benefits under the Plan are funded through a trust
established with Mellon Bank and are in addition to those you may
be eligible to receive under the Federal Social Security Program.

          This booklet satisfies two purposes.  First, it
constitutes part of a Prospectus for purposes of the Securities
Act of 1933, as amended (the "Securities Act"), and second, it
serves as a Summary Plan Description under the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
The purpose of the Prospectus is to provide you with information
about the Company, the Company's common stock ("Common Stock"),
and the Company's Series A Convertible Exchangeable Preferred
Stock, four of which are represented by one depository share (the
"Preferred Stock" and "Depositary Shares," respectively).  In
this booklet, Common Stock and Preferred Stock are referred to
together as "Company Stock."  This information is provided so
that you will be able to make an informed decision as to whether
to invest in Company Stock through the Plan.  As of June 30,
1997, 6,965,328 shares of Common Stock, $2.50 Par Value, and
2,300,000 depository shares, each representing one quarter of a
share of the Company's Series A Convertible Exchangeable
Preferred Stock, $0.25 Par Value per depository share, are
outstanding.

          This booklet describes the Plan as it currently
operates.  The Plan is effective September 1, 1987, as amended
through the date of this booklet.  Also, prior versions of the
Plan continue to apply to events that occurred while those
versions were in effect.  For example, participants who
previously retired or terminated employment had their benefits
determined under the Plan that was in effect at the time of their
retirement or termination.  Their benefits are not affected by
later amendments to the Plan or changes in the law.

          Please read this booklet carefully.  The Summary Plan
Description is, as its name suggests, only a summary of the Plan.
The precise rules of the Plan are set forth in the Plan document
and, in case of any inconsistency, the Plan document will govern.
If you wish to see a copy of the actual Plan document, you may do
so by contacting the Plan Administrator.
GENERAL PLAN INFORMATION

1.   Name of Plan: Westmoreland Coal Company and Affiliated
     Companies Employees' Savings/Retirement Plan.

2.   Employer (Plan Sponsor) and IRS Employer Identification
     Number:

          Westmoreland Coal Company
          EIN: 23-1128670
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903

3.   Participating Employers:  The list of participating
     affiliated companies changes from time to time and is
     available upon request from the Plan Administrator.

4.   Plan Number:  001

5.   Type of Plan: Defined Contribution

6.   Type of Administration:  The Plan is trusteed.

7.   Plan Administrator:

          Westmoreland Coal Company Savings/Retirement Plan
           Administrative Committee
          c/o Westmoreland Coal Company
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903
          (719) 448-5822
          Attention:  Cheryl M. Sprague

     The above-named Committee is the Administrator of the Plan
     for purposes of ERISA.  As such, the Committee is
     responsible for preparing certain reports, returns and
     disclosures required by law and is responsible for
     controlling and managing the operation and administration of
     the Plan.  Members of the Committee may be appointed or
     removed at any time by the Company's Board of Directors in
     its sole discretion.  The Committee is also the named
     fiduciary responsible for benefit applications and claims
     review.

8.   Agent for the Service of Legal Process:  None designated.
     Legal process on matters relating to the Plan may be served
     in the name of the Plan on the Plan Administrator or the
     Trustee.
9.   Plan Trustee:

          Mellon Bank, N.A.
          One Mellon Bank Center
          Defined Contribution Services
          9th Floor
          Pittsburgh, PA  15258-0001

     The Trustee manages and holds the Plan's assets in trust and
     provides recordkeeping services for the Plan.  Pursuant to
     the instructions of the Company, the Trustee invests Plan
     assets, holds cash in deposit accounts, keeps investments in
     nominee or bearer form, pays benefits and expenses of
     administering the Plan, and otherwise acts on behalf of the
     Plan as set forth in a Trust Agreement.

     The Company may contract for additional professional and
     other services to carry out the Plan.  The Plan provides
     that all administration expenses of the Plan and the Trustee
     will be paid by the Company or, at its option,
     proportionally from the funds held pursuant to the Plan.

10.  Investment Manager: The Investment Manager or Advisor for
     each of the investment alternatives is named in the
     description of investment options attached as Appendix A.

11.  Plan Year: September 1 - August 31.  Plan records are
     maintained on this basis.

                       HOW THE PLAN WORKS

PURPOSE OF PLAN

          The purpose of the Plan is to provide for employee
security in retirement and to encourage employees to save on a
regular basis.

THE PLAN IN BRIEF

          The Plan is an individual account defined contribution
plan with a cash or deferred arrangement.  As such, it is
intended to qualify under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the "Internal Revenue Code").  The Plan
is subject to most provisions contained in Titles I, II and III
of ERISA, including provisions governing reporting, disclosure,
participation, vesting and fiduciary responsibility.

          After you are eligible to enroll in the Plan, you may
elect to contribute up to 15% of your pay on a before-tax basis
to the Plan.  The amount of your contribution will be deducted
from each pay check.  The Company will then match a certain
percentage of your salary reduction contributions.  Because your
contributions are made on a pre-tax basis, you defer paying
income taxes on them, on the Company's matching contributions and
also on any earnings on the money in your account until you
actually receive these amounts.
All contributions made to the Plan on your behalf are
held in the Plan's Fund and are invested for your benefit.  Your
account under the Plan will reflect the amount that you have
contributed, any amount that has been contributed for you by the
Company, and any investment gains and losses allocable to these
contributions.  Thus, the benefits you ultimately receive from
the Plan will depend on the amount you have contributed and the
investment performance you experience while you have an account
in the Plan.  The Plan will pay you a benefit upon your
retirement, disability or death.

          If you are a "Corona Participant," that is, you were an
employee of the Corona Engineering and Consulting Division of
OESI Power Corporation on September 30, 1995 and became an
employee of the Corona Division of Westmoreland Energy, Inc. on
October 1, 1995, then some special rules, as described later in
this booklet, may apply to you.

WHO TO CONTACT FOR MORE INFORMATION

          The day-to-day operations of the Plan are handled by
the Company's Plan Administrator.  The Plan Administrator is a
committee whose members are appointed from time to time by the
Board of Directors of the Company.  Additional information about
the Plan and the Plan Administrator may be obtained by calling
Cheryl M. Sprague, Director of Human Resources, at
(719) 448-5822.

          Recordkeeping and investment of Plan assets are handled
by Mellon Bank.  Info Line, a telephone computer link arranged
through Mellon Bank, permits you to make choices and receive
information about your account over the telephone.  The Info Line
number is 1-800-407-4015.  Plan participants will have electronic
access to their accounts 24 hours a day.  Dreyfus Retirement
Services Plan Specialists will be available to assist callers
Monday through Friday from 9 A.M. to 8 P.M. (Eastern Time).

                WHO MAY PARTICIPATE IN THE PLAN

          In order to participate in the Plan you must:

          -    have reached age 21

          -    be employed by the Company or a participating
               affiliate of the Company

          -    not be covered by a collective bargaining
               agreement

          -    have worked at least one hour of service since the
               current Plan became effective on September 1, 1987, and

          -    have completed 1,000 hours of service.
If you have met all of these eligibility requirements,
you can participate in the Plan on the first day of the month
following the date you complete 1,000 hours of service.  If you
have met these eligibility requirements but you are no longer
employed by the Company or a participating affiliate, or you
become subject to a collective bargaining agreement, you can
become eligible to participate again as soon as you work one hour
of service as an employee of the Company or a participating
affiliate and you are not covered by a collective bargaining
agreement.

          If you are a Corona Participant, your hours of service
with Corona when it was a division of OESI Power Corporation will
be counted towards your hours of service requirement for
participation under the Plan.

                   CONTRIBUTIONS TO THE PLAN

EMPLOYEE CONTRIBUTIONS

          SALARY REDUCTION CONTRIBUTIONS

          You do not automatically participate in the Plan just
because you are eligible.  Instead, you must enroll in the Plan
and choose to reduce a certain percentage of your pay through
payroll deduction.  These contributions to the Plan are called
Salary Reduction Contributions.  If you elect to make Salary
Reduction Contributions, your base pay, up to certain limits
established and adjusted for cost of living by Federal tax law,
will be reduced by the amount you choose.  Then, this amount will
be contributed to your Salary Reduction Contribution account.

          Your Salary Reduction Contributions are taken from your
pay before Federal income taxes are deducted.  Since these taxes
are based on a lower income (your pay minus your before-tax
contributions), your taxes are lower.  Your Salary Reduction
Contributions, however, are subject to Federal Social Security
(FICA) tax and Federal unemployment (FUTA) tax.

          After February 28, 1995, you can elect to have up to 15
percent of your pay withheld from your paycheck and contributed
to the Plan.  (Before this time, you could only contribute up to
10 percent of your pay.)  The amount of your contributions will
ultimately change as your base pay changes.  In order to
determine the amount of your Salary Reduction Contributions and
Matching Contributions, your "pay" is the amount of your base pay
from the Company or a participating affiliate excluding overtime
pay, bonuses, commissions, and any other form of incentive or
special pay and expense reimbursements.  Your pay for these
purposes does include your Salary Reduction Contributions to the
Plan and contributions under any cafeteria plan.  Under Federal
tax law, the maximum amount of your pay that may be included in
determining Salary Reduction Contributions is $160,000 for 1997.
(This number will be adjusted periodically for inflation.)
The maximum amount of Salary Reduction Contributions
you can make in any calendar year is limited by the Internal
Revenue Service ("the IRS").  In 1997, the IRS limit is $9,500.
(See "Limits on Your Contributions-Salary Reduction
Contributions" below for more information on the limits
applicable to Salary Reduction Contributions.)

          After February 28, 1995, you may change the percentage
rate you defer on any day, up to once a month.  (Before then, you
could only make changes once a quarter.)  You may also
discontinue your Salary Reduction Contributions at any time, but,
if you want to start deferring again, you must wait until the
first day of the payroll period following the first day of the
next calendar month.  If you wish to change or stop your Salary
Reduction Contributions, either complete an Enrollment and Change
Form from your enrollment kit or call the Info Line at
1-800-407-1015.  Salary Reduction Contribution elections become
effective as soon as administratively possible, but not before
the first payroll period following the payroll period during
which the election is made.

          VOLUNTARY CONTRIBUTIONS

          These are after-tax contributions you may have made
prior to June 1, 1984 under the Plan that was then in effect.
You are no longer permitted to make these after-tax contributions
to the Plan.  The after-tax contributions you made before
June 1, 1984 will continue to be held under the Plan.

          ROLLOVER CONTRIBUTIONS

          If you had an account under a former employer's
qualified retirement plan or if you transferred a distribution
from such a plan to an individual retirement account (IRA), you
may be able to transfer or "roll over" these funds into this
Plan, if you comply with certain rules established for rollovers.
Amounts rolled over to this Plan will be placed in a separate
account in your name, known as your Rollover account.

          The tax laws that apply to rollovers are complex.  If
you have money in a former employer's plan or in a rollover IRA
and you wish to arrange for a rollover of these amounts into the
Plan, please see your Plan Administrator.
EMPLOYER CONTRIBUTIONS

          MATCHING CONTRIBUTIONS

          If you make Salary Reduction Contributions in a
particular Plan Year, the Company will match 50% for each dollar
you contribute, up to the first 5% you contribute from your pay.
For example, if your monthly paycheck is $2,000 and you
contribute 5% of your pay before taxes ($100), the Company would
add $50 to your account for that month.  This Matching
Contribution will be added to your account on the date of your
paycheck.  Note that under Federal tax law, the maximum amount of
your pay that may be included in determining Matching
Contributions is $160,000 for 1997.  (This number will be
adjusted periodically for inflation.)

          If you are a Corona Participant, effective
October 1, 1995, the Company will match one dollar for each
dollar you contribute from your pay as a Salary Reduction
Contribution, up to the first 7% you contribute from your pay.

VALUATION AND ACCOUNT STATEMENTS

          Generally, the value of your account will be determined
each business day according to the fair market value of the
investment option you have chosen.  You will receive quarterly
statements from Mellon Bank showing your account balance and
transactions during that quarter.  You may obtain your account
balance at any time by calling the Info Line.

TYPES OF ACCOUNTS

          You will have your own account within the Plan's Fund.
Within your account are several sub-accounts, one for each type
of investment election you make and one for each type of
contribution made to your account, such as Salary Reduction
Contributions, Matching Contributions and Rollover funds.  Each
sub-account also contains the appropriate adjustments for
withdrawals, distributions, earnings, losses and expenses.

LIMITS ON YOUR CONTRIBUTIONS

          Federal tax law imposes certain limitations on the
amount of contributions that may be made to the Plan:

          SALARY REDUCTION CONTRIBUTIONS

          The maximum amount of Salary Reduction Contributions
you may make to the Plan in any calendar year is limited by the
IRS.  In 1997, the limit is $9,500.  The IRS may adjust this
limit in the future.  To comply with this limit, the Company may
either prospectively restrict your election or return to you any
extra amounts contributed, together with any earnings on those
amounts, on or before the April 15th following the end of the
calendar year.
If you are considered a highly paid employee (as
defined by IRS regulations), other limitations may apply to you
as well.  Federal law requires that the Plan be tested annually
to ensure that the percentage of compensation contributed by
highly paid employees, on average, does not exceed the percentage
of compensation contributed by other employees by more than a
permitted amount.  If the test cannot be passed, or if this
limitation is or may be exceeded, highly paid employees may have
their contributions reduced or suspended during the year (or, in
some cases, prior employee contributions may have to be returned
to highly paid employees).  If you are affected by this
restriction, you will be notified.

          MATCHING CONTRIBUTIONS

          A similar test may limit the Company's matching
contributions for highly paid employees.  If the limit is
exceeded by any highly paid employee, the excess matching
contributions together with earnings will be distributed to the
highly paid employee after the end of the year.  If you are
affected by this restriction, you will be notified.

          TOTAL ANNUAL CONTRIBUTION

          In addition, there is a limit on the total amount
(i.e., Salary Reduction Contributions and Matching Contributions)
you can add to your account in any Plan Year.  Generally
speaking, this limit is $30,000 or 25% of your pay for the year,
whichever is less.  Again, the maximum amount of pay that can be
taken into account for this purpose in 1997 is $160,000 (as
indexed for inflation).  If you are affected by these
restrictions, you will be notified. Your contributions may be
limited to prevent this total annual contribution limit from
being exceeded.

                            VESTING

          At all times you will be 100% vested in your entire
account under the Plan.  This means that you have earned a
nonforfeitable right to receive 100% of your account from the
Plan in the future, regardless of when you stop working for the
Company.

                     INVESTING YOUR ACCOUNT

INVESTMENT OPTIONS

          Under the Plan, you decide how your account will be
invested, except for certain amounts that have already been
automatically invested in Company Stock before 1994 (see
"Investment in Company Stock" below).  The investment options
currently available are described in Appendix A to this booklet.
There are transaction fees or expenses charged to you
or your account when you purchase or sell the investments offered
under the Plan.  These fees are described in Appendix A to this
booklet  For information about the administrative and management
fees incurred by the investment funds, see the Prospectus or
Product Description for the respective fund.

YOUR INVESTMENT RESPONSIBILITIES

          Each investment option has different investment
objectives, different expected rates of return, and different
risks.  See Appendix A for a description of the investment
options currently available under the Plan.  More information
about the investment options may be found in the fund
Prospectuses or Product Descriptions and other related materials
contained in your enrollment kit and available from the Plan
Administrator or in the Prospectuses or Product Descriptions
available from Dreyfus Retirement Services.  To receive
additional information relating to an investment in Company
Stock, you should read the section in this booklet called
"Investment in Company Stock" and you may also contact
Westmoreland Coal Company directly at the address and phone
number provided in Item 7 of the General Information section of
this booklet.  You should be sure to read all of the information
describing the funds before making any investment decisions.  NO
INVESTMENT CAN GUARANTEE A CERTAIN RATE OF RETURN.  NO INVESTMENT
CAN BE GUARANTEED AGAINST LOSS.

          When you make an investment choice, your investment
election will remain in place until you change it.  Your election
applies to your contributions as well as any earnings on them.
On and after March 1, 1995, you generally may transfer funds
among the investment options (or change how new contributions
will be invested) on any day of any calendar month, as long as
you make only one election in any month, subject to the
restrictions on the Company Stock discussed in the section in
this booklet called "Resale of Company Stock Acquired from the
Plan."  (Note that before March 1, 1995, investment selection
could only be made once each Plan quarter.)  You may call the
Info Line to make investment selections and changes.  Most
investment selections become effective on the same or next day
that you request the change.  You may inquire about the effective
date of your particular selections when you call the Info Line.

THE PLAN'S RESPONSIBILITIES

          The Plan is intended to comply with the requirements of
section 404(c) of ERISA.  This means that the Plan permits
participants to direct the investment of their accounts.  As long
as the Plan complies with the requirements of section 404(c), you
have the responsibility to decide how your accounts are invested
and the parties that otherwise would be responsible for making
investment decisions (the "fiduciaries" of the Plan) will not be
liable for any losses that result directly from investment
instructions that you make.  Mellon Bank will not take any action
regarding the investment of your account without specific
instructions from you.
To comply with section 404(c), the Plan must permit
participants to choose from a broad range of investment
alternatives and must provide participants with certain
information about the investment alternatives and the operation
of the Plan.  In addition to the information included in this
booklet and the accompanying Appendix that describes the
investment options available under the Plan, you may request the
following information:

          -    A description of the annual operating expenses of
               each investment fund, and the aggregate amount of such
               expenses expressed as a percentage of average net
               assets of the investment fund.

          -    Copies of any prospectuses, financial statements
               and reports and any other materials relating to the
               investment funds to the extent such information is
               provided to the Plan.

          -    A list of assets comprising the portfolio of each
               investment fund that constitute Plan assets within the
               meaning of ERISA and the value of each such asset.

          -    Information concerning the value of shares or
               units in each investment fund, as well as the past and
               current investment performance of such investment fund,
               determined, net of expenses, on a reasonable and
               consistent basis.

          -    Information concerning the value of shares or
               units in investment funds held in your account.

          You will be able to receive most of this information
from Dreyfus Retirement Services by calling the Info Line or by
writing to Dreyfus Retirement Services at 144 Glenn Curtiss
Boulevard, Uniondale, NY  11556-0144.

          The Administrative Committee of the Westmoreland Coal
Company is the named fiduciary responsible for providing the
information described above for all investment alternatives
available under the Plan, so if you do not receive information
you need from Dreyfus Retirement Services, you should contact the
Company at the address or phone number provided in Item 7 of the
General Information section of this booklet.
INVESTMENT IN COMPANY STOCK

          AUTOMATIC INVESTMENT IN COMPANY STOCK

          All Salary Reduction Contributions and Rollover
Contributions made before March 1, 1990, Matching Contributions
made before December 1, 1993 and Voluntary Contributions made
before June 1, 1984 were automatically invested in Company Stock.
These contributions may not be transferred into other investment
options until you reach age 55, unless between June 1, 1990 and
September 1, 1994 you elected, no more than once a Plan Year, to
transfer up to 20% of the value of these pre-1990 Salary
Reduction Contributions, pre-1990 Rollover Contributions and
Voluntary Contributions to other investment options.  After you
reach age 55, you may transfer a portion of your remaining
pre-1990 Salary Reduction Contributions, pre-1990 Rollover
Contributions, Voluntary Contributions and pre-1994 Matching
Contributions to other investment options once a Plan Year.  Here
is a schedule that shows what percentage of these shares you can
transfer per Plan Year depending on your age:

                                    ...then you may transfer
                                    up to this percentage of
       If you are this age...       the shares described above
        ---------------------       --------------------------

             55                                40%
             56                                60%
             57                                80%
             58 or older                      100%

Additionally, you may choose to have the entire amount of
Matching Contributions made to your account before
December 1, 1993 and invested in Company Stock invested in either
Common Stock or Preferred Stock, but you are prohibited from
later changing this election until you reach age 55.

          OPTIONAL INVESTMENT IN COMPANY STOCK

          The rest of your account, that is, Salary Reduction
Contributions and Rollover Contributions made on and after
March 1, 1990 and Matching Contributions made on and after
December 1, 1993, can be invested in any investment option you
select, including Company Stock, and you may change your
investment mix up to once a month on any day of the month.

          Descriptions of Common Stock and Preferred Stock are
included in Appendix A of this booklet.  Preferred Stock is
described further in Appendix B.

          PURCHASE OF COMPANY STOCK

          If you invest in Company Stock, the Trustee will
purchase the Company Stock on the over-the-counter market at
prevailing market prices as soon as practicable.
Procedures have been established by the Company to
ensure that your decisions to purchase, hold and sell Company
Stock remain confidential.  Your investment instructions are sent
to the Plan's recordkeeper who communicates these instructions to
the Trustee.  Your decision to invest in Company Stock is
communicated only to the people who must know the information to
properly administer the Plan.  The person responsible for
monitoring these confidentiality procedures and other procedures
which ensure that your voting decisions with respect to the
shares of the Company Stock held in your account remain
confidential is:

          Westmoreland Coal Company Savings/Retirement Plan
           Administrative Committee
          c/o Westmoreland Coal Company
          14th Floor
          2 North Cascade Avenue
          Colorado Springs, Colorado 80903
          (719) 448-5822
          Attention:  Cheryl M. Sprague

          VOTING OF COMPANY STOCK

          If you invest in Company Stock, the stock certificates
will be issued in the Trustee's name and held by the Trustee, but
you will have the power to direct the Trustee how to vote your
shares.  You will be notified from time to time that a vote is
scheduled and how you can instruct the Trustee how to vote your
shares.  The Company will not know how you voted and your voting
decision will be kept confidential.  If you do not direct the
Trustee, the Trustee will vote your stock at its discretion.  In
addition, you will be able to give confidential instructions to
the Trustee in the case of tender offers affecting the shares of
Company Stock held in your account.

          RESALE OF COMPANY STOCK ACQUIRED FROM THE PLAN

          The Plan imposes no limitation or restriction on
resales of Company Stock acquired in a distribution from the
Plan.  In addition, shares of Company Stock that have been
registered under the Securities Act may generally be resold by
participants who have received them in a distribution of Company
Stock from the Plan.  However, participants who may be deemed to
be "affiliates" of Westmoreland Coal Company may resell shares of
Company Stock received in a distribution only pursuant to an
effective registration statement specifically relating to such
resales, pursuant to Rule 144 under the Securities Act or in a
transaction otherwise exempt from registration under the
Securities Act.

KEEPING TRACK OF YOUR INVESTMENTS

          You may obtain more information about your investments
under the Plan by calling the Info Line at any time.
DISTRIBUTIONS FROM THE PLAN

          With the exception of certain withdrawals and loans
(described on pages 14-16), benefits under the Plan are
ordinarily paid ONLY upon retirement, disability, other permanent
separation from service or death.  Funds are not otherwise
available to you.

DISTRIBUTIONS UPON SEPARATION FROM SERVICE

          RETIREMENT

          If you retire at or after reaching age 65, you are
entitled to receive your entire account balance.

          DEATH

          If you die before the entire interest in your account
is paid out to you, the remaining interest will be paid to your
beneficiary as soon as practicable following your death.

          TOTAL DISABILITY

          If you become totally disabled, your account will be
paid out to you.  As of September 1, 1995, you are considered
totally disabled if you are receiving benefits under a long term
disability program sponsored by the Company or a participating
affiliate and if your disability is expected to be indefinite,
rendering you unable to return to work.  If you became totally
disabled before September 1, 1995 you had to remain totally
disabled for six consecutive months before your account could be
distributed to you.  If you became totally disabled on or after
September 1, 1995 there is no longer a six month waiting period.

          OTHER SEPARATION FROM SERVICE

          If you leave for any other reason, you are entitled to
receive the entire interest in your account.

DISTRIBUTIONS UPON REACHING AGE 70-1/2

          If you reach age 70-1/2 and your benefits have not yet
begun to be paid, you will start receiving a benefit on the
April 1 after the calendar year in which you reach age 70-1/2,
even if you have not retired or otherwise separated from service
at this time.

TIMING OF DISTRIBUTION

          If you have $3,500 or less in your account or you have
reached age 65, you will automatically receive your benefits on
the soonest practicable date after your account has been valued
after your separation from service.
If you have ever had more than $3,500 in your account
or you have not reached age 65, you will receive your benefits on
the soonest practicable date after your account has been valued
after your separation from service or, at a later date you
choose, but not later than the time you reach age 65.

FORM OF DISTRIBUTION

          If your interest in your account does not exceed
$3,500, your interest will be paid to you or your beneficiaries
in a single lump sum.

          In all other cases, you or your beneficiaries may
choose to receive your interest in a single lump sum or in the
form of an annuity providing for payments for a term of 5, 10 or
15 years, but no longer than your life expectancy at the time
your benefits begin.  If you do not choose a form of benefit,
your benefit will be paid in a single lump sum.

          If your account contains Company Stock, you may elect
to receive your distribution in cash or in stock, unless you have
fewer than ten shares, in which case the distribution will be
made in cash.

          You will be provided with the appropriate forms to make
these elections prior to the time of distribution.

WITHDRAWALS OF YOUR ACCOUNT

          VOLUNTARY CONTRIBUTION AND ROLLOVER ACCOUNTS

          You may withdraw, once a Plan Year, any amount from
your Voluntary Contribution account or your Rollover account.

          SALARY REDUCTION CONTRIBUTION ACCOUNT - WITHDRAWAL FOR
          FINANCIAL NECESSITY

          You may withdraw, up to once a Plan Year, any amount
from your Salary Reduction Contribution account if you show the
Plan Administrator that you have an immediate and heavy financial
need and demonstrate that this money is needed to satisfy that
need.  A need will be considered immediate and heavy if it arises
from:

          -    expenses for medical care for you, your spouse or
               your dependents,

          -    the purchase by you of a new principal residence
               (not mortgage payments),

          -    payment of tuition and related educational fees
               for the next year of post-secondary education for you,
               your spouse, children or dependents, or

          -    payments needed to prevent your eviction or
               foreclosure from your principal residence.
You cannot withdraw more than you need to meet your
hardship (including whatever is needed to satisfy the tax on the
withdrawal) and you must have obtained money from all other
permissible distributions and non-taxable loans, if any, under
this or other plans maintained by your employer.

          If you make a hardship withdrawal, you may not make any
Salary Reduction Contributions to your account for the next 12
months.  Further, in the following calendar year when you are
able to make Salary Reduction Contributions again, you will be
limited in how much you may contribute.

          AGE 59-1/2 WITHDRAWALS

          When you reach age 59-1/2, you may withdraw up to the
total amount in your account, less any amounts already withdrawn.

          TAXES ON WITHDRAWALS

          All distributions, including withdrawals (except
withdrawals of after-tax contributions) are subject to Federal
income tax in the year you receive the payment.  (See "Tax
Treatment of Distributions," below, for more information.)

LOANS DURING EMPLOYMENT

          You may borrow from your account only if you are an
active employee participating in the Plan.  You may apply for a
loan from the Plan once a calendar year, but you can never have
more than one outstanding loan at a time.  To apply for a loan,
contact the Plan Administrator for loan application forms.
Beginning March 1, 1990, the minimum loan amount is $1,000.
(Before March 1, 1990, the minimum loan amount was $500.)  You
may borrow up to 50% of the total value of your account as long
as that amount is no more than $50,000, but you cannot borrow
more than you have personally contributed to your account.  In
addition, you are limited in the total amount you can borrow from
this and other plans sponsored by the Company and affiliated
companies.

          If you take out a loan, you must pay interest on the
loan.  Beginning February 28, 1995, the interest rate is the
prime rate plus 1%, fixed as of the date of your loan
application.  This rate will remain the same for the entire
period of the loan.  (Before February 28, 1995, the rate was
equal to the fixed rate the Trustee charged for unsecured loans.)

          Generally, you have five years to repay your loan,
unless you use it to acquire your principal residence, in which
case your repayment term may be as long as 15 years.  You repay
the loan in installments through automatic payroll deductions.
You will authorize these deductions when you request your loan.
Each payment you make of principal and interest will be credited
to your account.  You may pay off the outstanding balance of your
loan at any time in a lump sum with no penalty by notifying
Mellon Bank.  If you do this, however, you may not apply for
another loan for the next 12 months.
Certain events, such as death, separation from service,
certain reductions in salary, failures to pay, or attempts to revoke a
payroll deduction authorization for repayment will accelerate the
loan so that the principal and interest become payable in full
immediately.  If you fail to pay in the time specified, the
outstanding balance of the loan plus accrued interest will be
deducted from your account and you will be subject to Federal
income tax on it.

                 TAX TREATMENT OF DISTRIBUTIONS

          The Plan is intended to qualify for certain favorable
tax treatment (that is, it is intended to be a "qualified" plan
under Section 401(a) of the Internal Revenue Code).  Taxes
generally are not due on any contributions when they are made.

          Your benefits from the Plan, including withdrawals
during employment, generally are subject to tax when distributed.
The distribution is generally subject to Federal income tax at
ordinary income tax rates; however, any after-tax contributions
are exempt from tax when distributed.  You should be aware of the
following additional rules:

          -    ROLLOVER TO OTHER PLANS.  You have the right to
               instruct the Plan Administrator to transfer all or a
               portion of a lump sum payment from the Plan (but not
               less than $500) directly to either an IRA (individual
               retirement account or individual retirement annuity) or
               to another employer's plan that accepts rollovers.  (If
               you receive a benefit payment because you are age
               70-1/2 or older, part of the payment may not be
               eligible for rollover, in which case the Plan
               Administrator will let you know.)  If you choose a
               direct rollover, no Federal income tax will be withheld
               on the amount you roll over and you will not pay tax in
               the current year on the amount you roll over.

               If, instead, you choose to receive the payment,
               the Plan Administrator is required by law to withhold
               20% of the payment as Federal income tax withholding to
               be credited toward the amount of tax you owe for the
               year. The payment will be taxed in the current year,
               unless you roll over the payment to an IRA or another
               employer's qualified plan that accepts rollovers within
               60 days of receiving the payment.  The amount rolled
               over will not be taxed until you take it out of the IRA
               or the other employer's plan.  If you want to roll over
               the full amount of the payment, you must find other
               money to replace the 20% that was withheld; otherwise
               you will have to pay tax in the current year on the
               amount that was withheld.

               Prior to distributing funds to you from the Plan,
               the Plan Administrator will provide you with a notice
               generally explaining your rollover options, as well as
               the withholding requirements and possible tax
               consequences of your election.

          -    10% PENALTY TAX MAY APPLY.  If you receive a
               taxable distribution or withdrawal from the Plan before
               you reach age 59-1/2, you will be required to pay an
               additional 10% Federal tax unless you meet one of the
               limited exceptions to this rule.  You should consult a
               tax advisor about the tax consequences of any
               particular withdrawal or distribution to determine if
               the 10% penalty tax will apply.

               The laws that govern the tax treatment of
               contributions to and benefit payments from retirement
               plans are quite complex.  YOU SHOULD CONSULT WITH YOUR
               PERSONAL TAX ADVISOR ABOUT YOUR OWN PARTICULAR
               SITUATION AND HOW THESE RULES APPLY TO A SPECIFIC
               PAYOUT TO YOU.

                    BENEFICIARY DESIGNATION

          You may choose a beneficiary or beneficiaries to
receive your interest in your account after your death.  However,
if you are married, you must designate your spouse as your
beneficiary, unless your spouse properly consents to a different
beneficiary on the form provided for this purpose.  You may
change your beneficiary designation at any time so long as you
properly notify the Plan Administrator.

              AMENDMENT OR TERMINATION OF THE PLAN

          Although the Company intends for this Plan to be
permanent, each participating company has the right to terminate
its participation in the Plan at any time.  In addition, the
Company may terminate or amend the Plan at any time by action of
the Company's Board of Directors or its delegate.

          If the Plan is completely discontinued, the total
amounts then in your accounts will be fully vested and held for
distribution to you in accordance with the benefit provisions of
the Plan or in such other manner as the Company may determine.

                 PLAN INSURANCE DOES NOT APPLY

          The Plan is not covered by the Federal insurance
program of the Pension Benefit Guaranty Corporation (PBGC).  The
PBGC only guarantees pensions for defined benefit plans which
fund for a specific monthly benefit upon retirement.  Because the
Plan is a defined contribution plan with benefits based on an
account and not a specific monthly benefit, the Plan is not
insurable.
GENERAL PROVISIONS

ASSIGNMENT OF BENEFITS

          Your account balance belongs to you and may not be
sold, assigned, transferred or pledged to another person under
most circumstances.  However, if you become a party to a divorce
property settlement or a court order, or if you become liable for
support or alimony payments, the Plan may be legally required to
pay all or a portion of your benefit to your spouse, ex-spouse,
children or other dependents in compliance with a qualified
domestic relations order.

TOP-HEAVY BENEFITS

          Federal law provides that in the event that the Plan is
shown to benefit certain "key employees" disproportionately, the
Plan may be declared "top-heavy" and become subject to special
rules.  If the Plan is declared "top-heavy," you will receive
information concerning the new rules that would apply to the
Plan.  It is extremely unlikely that the Plan will become
top-heavy.

CLAIM FOR BENEFITS

          After an event that entitles you to benefits has
occurred, you may apply for your Plan benefits by filing a
request with the Plan Administrator.

DENIAL OF CLAIM FOR BENEFITS

          If the Plan Administrator denies, in whole or in part,
your claim for benefits, the Plan Administrator will notify you
within 90 days of the specific reasons for the denial and how you
may perfect your claim or how you can appeal the denial.  In
special circumstances the Plan Administrator may extend the
response period for up to an additional 90 days, in which event
it will notify you in writing of the extension, and the reasons
for it.

          You or your representative have 60 days from receipt of
a notice of claim denial to petition the Plan Administrator in
writing for a full and fair review of the denial.  You or your
representative will be able to review pertinent documents and to
submit issues and comments in writing to the Plan Administrator.
The Plan Administrator will review the denial and will tell you
its decision and reasons for it in writing within 60 days of
receipt of the petition; provided, however, that in special
circumstances the Plan Administrator may extend the response
period for up to an additional 60 days, in which event it will
notify you in writing of the extension.  This is the only way to
contest a decision denying benefits under the Plan.
YOUR RIGHTS UNDER ERISA

          As a participant in the Plan, you are entitled to
certain rights and protections under ERISA.  ERISA provides that
all Plan participants shall be entitled to:

          -    Examine, without charge, all Plan documents,
               including insurance contracts and copies of all
               documents filed by the Plan with U.S. Department of
               Labor, such as detailed annual reports and Plan
               descriptions.  The documents may be examined at the
               Plan Administrator's office.

          -    Obtain copies of all Plan documents and other Plan
               information upon written request to the Plan
               Administrator, who may make a reasonable charge for the
               copies.

          -    Receive a summary of the Plan's annual financial
               report.  The Plan Administrator is required by law to
               furnish each participant with a copy of this summary
               annual report.

          -    Obtain a statement of your account balance.  You
               must request such a statement in writing, and not more
               than once a year.  This service is free of charge.

          In addition to creating rights for Plan participants,
ERISA imposes duties upon the people, called "fiduciaries," who
are responsible for the operation of the employee benefit plan.
They have a duty to operate the Plan prudently and in the
interest of Plan participants and beneficiaries.  The Company may
not fire you or otherwise discriminate against you in any way to
prevent you from obtaining a benefit or exercising your rights
under ERISA.  If your claim for a benefit is denied in whole or
in part, you must receive a written explanation of the reason for
the denial.  You have the right to have your claim reviewed and
reconsidered.

          Under ERISA, there are steps you can take to enforce
the above rights.  For instance, you may file suit in a Federal
court if you request materials from the Plan and do not receive
them within 30 days.  The court may require the Plan
Administrator to provide the materials and pay you up to $100 a
day until you receive them (unless the materials were not sent
because of reasons beyond the Plan Administrator's control).  If
your claim for benefits is denied in whole or in part, or
ignored, you may file suit in a state or Federal court.  If you
believe Plan fiduciaries have misused the Plan's money, or have
discriminated against you for asserting your rights, you may seek
assistance from the U.S. Department of Labor, or file suit in a
Federal court. If you are successful, the court may order the
person you have sued to pay court costs and legal fees.  If you
lose, the court may order you to pay (for example, if it finds
your claim to be frivolous).
If you have any questions about the Plan, you should
contact the Plan Administrator.  If you have any questions about
this statement or about your rights under ERISA, you should
contact the nearest Area Office of the U.S. Labor Management
Services Administration, Department of Labor.

                     AVAILABLE INFORMATION

          The Company is subject to the informational
requirements of the Securities Exchange Act of 1934 (the
"Exchange Act") and, in accordance therewith, files reports,
proxy statements and other information with the Securities and
Exchange Commission (the "Commission").  Such reports, proxy
statements and other information filed by the Company with the
Commission can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street N.W.,
Washington, D.C. 20549, and at its Regional Offices:  7 World
Trade Center, New York, New York 10048; and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661.  Copies can also be
obtained upon payment of prescribed rates from the Public
Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 or from the Commission's World Wide Web
site at http:\\www.sec.gov.

          The Company has filed with the Commission a
Registration Statement on Form S-8 (together with all amendments
and exhibits thereto, the "Registration Statement") under the
Securities Act covering the registration of the securities that
may be offered under the Plan.  The foregoing description does
not contain all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission.

          The Company will furnish, without charge, to each
eligible participant in the Plan a copy of its most recent 10-K
and, if available, annual report to shareholders and will also
deliver to each person holding an interest in the Plan, who does
not otherwise receive such materials as a shareholder of the
Company, copies of all reports, proxy statements and other
communications distributed to the shareholders of the Company
generally.  The Company also will provide, without charge, to
each person to whom a copy of this booklet is delivered, on the
written or oral request of any such person, a copy of any or all
of the documents which have been or may be incorporated by
reference in Item 3 of Part II of the Registration Statement,
which items are incorporated by reference into this booklet,
other than exhibits to such documents.  Requests for such copies
should be directed to Westmoreland Coal Company, Corporate
Secretary, 14th Floor, 2 North Cascade Avenue, Colorado Springs,
Colorado 80903, (719) 442-2600.

          Except where otherwise indicted herein, this booklet
speaks as of its date, and neither the delivery of this booklet
nor any sales hereunder shall under any circumstances create any
implication that there has been no change in the affairs of the
Company since that date or that the information contained herein
is correct as of any time subsequent to that date.  No person has
been authorized to give any information or to make any
representations, other than as contained in this booklet and in
other documents relating to the Plan delivered to eligible
employees in connection with the offer described in this booklet
and if given or made such information or representations must not
be relied upon.  This booklet does not constitute an offer of any
securities other than those to which it relates, or an offer of
those to which it relates in any state to any person to whom it
is unlawful to make such offer in such state.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

          The following documents filed by the Company with the
Commission pursuant to the Exchange Act are incorporated herein
by reference:

ITEM 3.   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.

          The following documents filed with the Securities and
Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") by Westmoreland Coal
Company (the "Company") (File No. 0-752) are incorporated herein
by reference:

                    (i)  the Company's Annual Report on Form 10-K
                         for the fiscal year ended December 31, 1996;
   
                   (ii)  the description of the Company's Common
                         Stock contained in its Registration Statement on
                         Form 8-A, filed May 22, 1992 and

                  (iii)  the description of the Company's
                         Depository Shares contained in its Registration
                         Statement on Form 8-A, filed June 23, 1992.

          Each document filed by the Company after the date
hereof pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold
or which deregisters all securities remaining unsold, shall be
deemed to be incorporated by reference in this Registration
Statement and shall be part hereof from the date of filing of
such document.
APPENDIX A TO
            SUMMARY PLAN DESCRIPTION AND PROSPECTUS
                     DATED JULY     , 1997

                  AVAILABLE INVESTMENT OPTIONS

     This Appendix provides additional information regarding each
of the investment options available under the Plan.  These
investment options consist of Company Stock and the following
investment funds available through Dreyfus Retirement Services:

          *      Dreyfus New Leaders Fund, Inc.
          *      Dreyfus International Growth Fund
          *      Dreyfus Cash Management
          *      Dreyfus Short-Intermediate Government Fund
          *      Dreyfus S&P 500 Index Fund
          *      Dreyfus Disciplined Stock Fund
          *      Capital Preservation Fund

     The following are investment profiles for each of the
Dreyfus Retirement Services investment funds, followed by
information regarding the Company Stock.  Such profiles are based
on information provided by Dreyfus Retirement Services.
Additional information, including financial data, investment
policies, management, distribution, and service fees and expenses
with respect to each of these funds is contained in the
Prospectus or Product Description for the fund, a copy of which
can be obtained through Dreyfus Retirement Services.  As with any
mutual fund, there is no assurance that the fund will achieve its
stated objective.
DREYFUS
                       Retirement Services

                 DREYFUS NEW LEADERS FUND, INC.

FUND DESCRIPTION
The Fund's goal is to maximize capital appreciation.

INVESTMENT STRATEGY
The  Fund  seeks  out companies that Dreyfus  believes  have  the
potential for significant growth. The Fund is particularly  alert
to  companies  which  it considers to be new  leaders,  that  is,
emerging   smaller-sized   companies   (typically   with   market
capitalizations  of  less  than  $750,000),  both  domestic   and
foreign, which the Fund's management believes to be characterized
by new or innovative products, services or processes which should
enhance  prospects for growth in future earnings. The  Fund  will
also   invest   in   special   situations   such   as   corporate
restructurings.  During normal market conditions  the  Fund  will
invest  aggressively in domestic and foreign common  stocks.  For
defensive   purposes  the  Fund  can  invest  in   money   market
instruments. The Fund may also invest up to 25% of its assets  in
foreign securities.

INVESTOR PROFILE
Dreyfus New Leaders Fund may be appropriate for investors seeking
long-term capital growth who are looking to supplement an overall
investment program with a more aggressive equity investment.

INVESTMENT RISKS
The  Fund invests principally in common stocks. Stock prices move
up  and down in response to the performance of their issuers  and
general economic and market factors. The prices of stocks move in
different degrees, based on varying impact of these factors  over
time,   which  affects  the  relative  volatility  of   a   fund.
Investments  in smaller-sized companies tend to be more  volatile
than  investments in larger-sized companies, which can cause  the
fund's  share price also to be more volatile. The Fund  can  also
invest  in  foreign  securities, which involve  additional  risks
including   political   and  economic   climates   and   currency
fluctuations,   and   use  sophisticated  investment   techniques
including  investments in derivative instruments. When  you  sell
your shares of the Fund, they may be worth more or less than what
you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

Management fees      .75%
Other Expenses       .46%

Total Portfolio Operating Expenses 1.21%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment  assuming ( 1 ) a 5% annual return and (2)  redemption
at the end of each period.

    One year       $  12
    Three years    $  38
    Five years     $  66
    Ten years      $ 147
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and returns may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to    shareholders.   Please   consult   your   Human   Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends and capital gains are generally declared and paid
annually. All distributions to retirement accounts will be
automatically reinvested in addition' al Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR PLAN.
IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING ALL OR A
PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS INVESTMENT OPTION,
PLEASE CONTACT YOUR HUMAN RESOURCES REPRESENTATIVE.

Premier Mutual Fund Services, Distributor
@) 1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation
DREYFUS NEW LEADERS FUND, INC.
MANAGED BY THE DREYFUS CORPORATION

                                 SMALLER CAPITALIZATION COMPANIES

BENCHMARK    Russell 2000 Index with dividends reinvested.*

STRATEGY     The  Fund invests primarily in common  stocks
             of  domestic  and  foreign  issuers  typically  with
             market  capitalizations below $1.5 billion  at  time
             of   purchase.    There   are  approximately   5,000
             companies  available  for  consideration   in   this
             market  capitalization range.  The Fund  may  invest
             up  to  25%  of  the  value of  its  assets  in  the
             securities  of  foreign  companies  which  are   not
             publicly  traded in the United States and  the  debt
             securities  of foreign governments.  Investments  in
             foreign  securities involve additional  risks.   For
             defensive  purposes, the Fund may invest  in  short-
             term  money market instruments and cash.  The Fund's
             share  price  and investment return  fluctuate  such
             that  an investor's shares may be worth more or less
             than  original cost upon redemption.  The Fund seeks
             to  identify  and  invest in smaller  capitalization
             companies  falling  into  one  of  three  investment
             designations as described below.

PROCESS      In  order to identify opportunities from
             a  5,000 company universe, Dreyfus employs a  sector
             manager  approach  in its equity  research  process.
             The  process  is  driven  by  fundamental  research.
             Cash  flow  analysis is the initial step  including:
             outlining  an  issuer's long-term financial  posture
             as  the  central  fiduciary interest  of  management
             towards   shareholders;  establishing   management's
             true  evaluation of returns available from producing
             assets;  and exploring capital requirements critical
             for future growth.

             Dreyfus managers will typically assign one of  three
             investment   designations.   Primary   emphasis   is
             placed  on  growth  companies  defined  by  dominant
             market  position, sustained record  of  achievement,
             and  strong financial condition.  Expectation  of  a
             high growth rate should be matched by high rates  of
             return on invested capital.

             Relative   sector  attractiveness  is   the   second
             approach to stock selection and may comprise  20-30%
             of  the  portfolio.   Dreyfus attempts  to  identify
             prospective  economic or political change  that  may
             have  a  uniformly beneficial effect  on  an  entire
             industry.   Finally,  special  situations   may   be
             identified,  including  those  companies  active  in
             acquisition, divestiture, share repurchase or  other
             processes  which  develop corporate  focus.   A  key
             element  is evaluation of the corporation's  balance
             sheet  and  the  expected return on assets,  coupled
             with   management's  firm  resolve  to  aim   toward
             growth, not simple survival.

             Stocks  in the portfolio may be sold if the original
             investment      designation     (growth,      sector
             attractiveness, special situation)  breaks  down  or
             fails  to materialize.  Margin deterioration at  any
             level   is   frequently  the  early   indicator   of
             corporate  stress.   The balance  inherent  in  this
             structure can result in an all-weather, rather  than
             simply   aggressive,  approach  to   small   company
             investing.
MGMT. & DIST.  FEES   The  Fund  is a no-load mutual  fund.   The
             management  fee  is payable monthly  at  the  annual
             rate  of  0.75  of  1% of the value  of  the  Fund's
             average  daily  net assets.  The Fund bears  certain
             costs   for   services  provided   to   shareholders
             pursuant  to  a  Shareholder  Services  Plan  at  an
             annual  rate  of  0.25 of 1% of  the  value  of  the
             Fund's  average daily net assets.  A  1%  redemption
             fee  will  be  charged and retained by the  Fund  on
             certain  shares  redeemed or  exchanged  within  the
             first  six  months of issuance and will be  deducted
             from  redemption proceeds. The redemption  fee  will
             not   be  charged  for  redemption  of  Fund  shares
             through  omnibus  accounts  for  various  retirement
             plans,   as  well  as  certain  other  accounts   as
             described in the Fund's prospectus.
             
             *Benchmark used for comparative purposes only.
             
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
DREYFUS NEW LEADERS FUND, INC.

PIE CHARTS DEPICTING SECTOR ALLOCATION VERSUS BENCHMARK AS OF MARCH 31, 1997

Tech/Cap Goods         21%              Tech/Cap Goods         18%
Consumer                8%              Consumer               18%
Mat'ls & Process       13%              Mat'ls & Process       11%
Energy                  4%              Energy                  5%
Credit Sens            27%              Credit Sens            33%
Healthcare             14%              Healthcare             10%
Other                   9%              Transport               4%
Cash                    4%              Other                   1%
                                                                
                      100%                                    100%
 DREYFUS NEW LEADERS FUND                  RUSSELL 2000 INDEX
             

TEN LARGEST                 OTHER                     PORTFOLIO
  HOLDINGS               INFORMATION               CHARACTERISTICS+
   AS OF                    AS OF               AS OF MARCH 31, 1997
FEBRUARY 28,            MARCH 31, 1997
    1997

Global       1.7%      Assets ($Mill)  693.6                 Fund   Russ 2000
Industries           
                                                 Price/                   
Executive    1.6%      Managment Fee    0.75%    Earnings    17.5      21.4
Risk                                             Ratio                  
                                                                  
Everest      1.6%      Total Expense    1.12%    Price/Book   3.1       2.3
Reinsurance            Ratio                     Ratio
Holdings        
                                                          
Varian       1.5%      Port. Turnover  102.22%   Med Mkt      1,045     340
Associates             Rate*                     Cap ($Mil)
                                                                               
Thiokol      1.5%      Net Asset       37.98     5-Yr Earnings 19.9    11.6
                       Value ($)                 Growth (%)
                                                                               
Consolidated 1.5%                                Dividend       0.7     1.6
Stores                                           Yield (%)++
                                                                  
Finova Group 1.4%                                Equity         0.99   1.00
                                                 Beta
                                                                  
Universal    1.4%      Primary         Since     Return Beta    0.92   1.00
Health                 Portfolio Mgrs. 
Services          
                                                                  
Crompton &   1.4%      Paul Kandel      1996     5 yr Std       10.6   11.0
Knowles                                          Dev (%)
                                                                  
Mentor       1.4%      Hilary Woods     1996     Number of       104   1911
                                                 Holdings
**As of last fiscal year end (12/31/96)

+Sources: FactSet & Frank Russell Co.
++Wtd. avg. dividend yield of equities in portfolio.

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS
ENDED MARCH 31, 1997
          New Leaders   Russell
            (w/divs)   2000(w/divs)*

                -6.77%   -5.17%      
One Year         4.13%    5.11%      
Three Years     13.32%   12.70%      
Five Years      12.07%   12.78%      
Ten Years       11.40%    9.42%    
   Fund Inception January 29, 1985
Calendar Year Performance+

       Dreyfus     Russell
         New         2000
       Leaders      Index*
        Fund       
                           
  1996  17.31%      16.50%
  1995  29.80%      28.44%
  1994  -0.15%      -1.82%
  1993  17.07%      18.91%
  1992   9.43%      18.41%
  1991  45.39%      46.05%
  1990 -11.86%     -19.51%
  1989  31.29%      16.24%
  1988  23.35%      24.89%
  1987  -5.12%      -8.77%
                                                      
+Reflects total return each year.
                          
Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may be worth more or less than original cost upon redemption.   A
1%  redemption fee will be charged and retained by  the  Fund  on
shares  redeemed  or  exchanged within the first  six  months  of
purchase.   Portfolio composition is subject  to  change  at  any
time.
*Source:  Frank  Russell  Company.  The  Russell  2000  Index  is
unmanaged; the performance results represent total return and the
reinvestment of dividends and other earnings.
This  material  must  be  preceded or accompanied  by  a  current
Prospectus  which  contains additional information  on  fees  and
expenses.  Please read the Prospectus carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services
                                
                      DREYFUS INTERNATIONAL
                           GROWTH FUND

FUND DESCRIPTION
The  Fund's  goal  is  to  provide you  with  capital  growth  by
investing primarily in foreign equity securities.

INVESTMENT STRATEGY
Under  normal market conditions at least 65% of the Fund's assets
will  be  invested in equity securities of foreign  issuers.  The
Fund  may  also invest in high grade debt securities  of  foreign
issuers  that management believes offer opportunities for capital
growth. While there are no geographic limits, the Fund will  seek
to  invest  its  assets in at least three foreign countries.  For
defensive   purposes  the  Fund  may  invest  in   money   market
securities.

INVESTOR PROFILE
The  Fund  may be appropriate for long-term investors  who  would
like to take advantage of international growth opportunities  and
are  willing  to  assume greater risks involved in  international
investing. An investment in the Fund should be as a supplement to
an overall investment program.

INVESTMENT RISKS
The Fund invests principally in common stocks of foreign issuers.
Generally  stock  prices  move up and down  in  response  to  the
performance  of  their issuers and general  economic  and  market
factors. The prices of stocks move in different degrees, based on
the  varying impact of these factors over time, which affects the
relative  volatility  of  a  fund.  Foreign  securities   involve
additional risks, including being subject to potentially volatile
political  and  economic climates and currency fluctuations.  The
Fund   can  use  sophisticated  investment  techniques  including
investments  in  derivative instruments. As a result  the  Fund's
portfolio  may  be  more  volatile than a portfolio  invested  in
domestic  equity  securities. When you sell your  shares  of  the
Fund, they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

    Management Fees                      .75%
    12b-1 Fees                           .51%
    Other Expenses                       .78%
    Total Portfolio Operating Expenses  2.04%

Example:  You  would  pay the following expenses  on  a  $1  ,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

                              Class R shares
    One year                   $ 21
    Three years                $ 64
    Five years                 $110
    Ten years                  $237
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Portfolio's  actual  performance
will vary and may be greater or less than 5 %.

INVESTMENT ADVISER
The  Dreyfus Corporation serves as the Fund's investment adviser.
The  Fund  portfolio  manager  is  Ronald  Chapman,  Director  of
International Equity for The Dreyfus Corporation.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends, and capital gains, if any, are declared and paid
annually. All distributions to retirement accounts will be
automatically reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING ALL OR
   A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS INVESTMENT
   OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES REPRESENTATIVE.

Premier Mutual Fund Services, Inc., Distributor
Copyright-1996 Dreyfus Retirement Services. a division of Dreyfus Service
Corporation, Broker/Dealer
DREYFUS INTERNATIONAL GROWTH FUND
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK         Morgan Stanley Capital International
                  Europe, Australia, Far East (EAFE)(Registered Trademark)
                  Index  with net dividends reinvested.*

STRATEGY          The  Fund invests primarily in equity
                  securities   of   foreign  issuers,   including
                  common   stocks,  convertible  securities   and
                  preferred stocks.  The Fund also may invest  in
                  debt   securities  of  foreign   issuers   that
                  management  believes  offer  opportunities  for
                  capital growth.

                  The  Fund's goal is to provide capital  growth.
                  There  can  be  no  assurance that  the  Fund's
                  investment  objective will  be  achieved.   The
                  Fund's  investment  in foreign  securities,  as
                  well   as   its   use  of  certain   investment
                  techniques,  involve additional  risks.   These
                  risks  are  described more fully in the  Fund's
                  Prospectus.    The  Fund's  share   price   and
                  investment   return  fluctuate  and   are   not
                  guaranteed.

PROCESS           At  least  65% of the  value  of
                  the    Fund's   total   assets   (except   when
                  maintaining  a  temporary  defensive  position)
                  will  be  invested  in  equity  securities   of
                  foreign  (non U.S.) issuers located  throughout
                  the  world.  The equity securities in which the
                  Fund   may  invest  include  those  of  issuers
                  located  in  emerging  markets,  which  present
                  additional   risks.    Under   normal    market
                  conditions  it  is expected that  substantially
                  all  of  the Fund's assets will be invested  in
                  securities  of  foreign issuers.   While  there
                  are  no  prescribed limits on geographic  asset
                  distribution  outside the  United  States,  the
                  Fund  ordinarily will seek to invest its assets
                  in no fewer than three foreign countries.
     
                  The Fund also may invest in debt securities  of
                  foreign   issuers  that  management   believes,
                  based   on  market  conditions,  the  financial
                  condition  of  the  issuer,  general   economic
                  conditions  and  other relevant factors,  offer
                  opportunities for capital growth.

MGMT. & ADMIN. FEES     The management fee is payable monthly  at
                  the  annual rate of 0.75 of 1% of the value  of
                  the  Fund's average daily net assets. The  Fund
                  pays    for    advertising,    marketing    and
                  distributing  its shares at an annual  rate  of
                  0.50  of  1% of the value of the Fund's average
                  daily  net  assets  under a  distribution  plan
                  adopted  pursuant  to  Rule  12b-1  under   the
                  Investment Company Act of 1940.  The Fund  also
                  pays  for the provision of certain services  to
                  its shareholders at the annual rate of 0.25  of
                  1%  of  the  value of the Fund's average  daily
                  net assets under a Shareholder Services Plan.

                  *Benchmark used for comparative purposes  only.
                  EAFE (Registed Trademark) is the property of Morgan
                  Stanley &  Co., Incorporated.
                  
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation
DREYFUS INTERNATIONAL GROWTH FUND
                                
PIE CHARTS DEPICTING COUNTRY ALLOCATION VERSUS BENCHMARK AS OF
MARCH 31, 1997

DREYFUS                             MSCI EAFE(Registered Trademark) 
INTERNATIONAL                       INDEX
GROWTH FUND

      Japan             27%                   Japan           29%
      UK                 8%                   UK              20%
      Germany            9%                   Germany          9%
      France             7%                   France           8%
      Oth Europe        23%                   Switzerland      6%
      Malaysia           6%                   Oth Europe      17%
      Other             12%                   Hong Kong        4%
      Hong Kong          3%                   Other            7%
      Sht Term Sec       5%                                      
                                                            100%
                      100%                                      

 Ten Largest Holdings                      Other Information
   as of February 28, 1997                as of March 31, 1997

British Sky Broadcasting    2.2%                                

Parmalat Finanziaria        1.9%         Assets ($Mill)        84.2

Tele Brasileiras, ADR       1.8%         Management Fee#      0.75%

Deutsche Bank               1.7%         Total Expense Ratio  2.07%

Nintendo                    1.7%         Net Asset Value ($)  15.13

Banque Nationale De Paris   1.6%                             

Cultor Oy                   1.6%                          

Vodafone Group PLC          1.6%         Primary Portfolio Manager     Since

Goudsmit Nv                 1.5%         Ronald Chapman                Mar-96

Kfc Holdings Berhad         1.4%                       
 
                                                     # Annualized

BAR GRAPH DEPICTING PERFORMANCE FOR
PERIODS ENDED MARCH 31, 1997
                 Dreyfus        EAFE (Registered Trademark)
                 International  Index*
                 Growth         

1Q 97             1.88%          -1.57%
One Year          4.44%           1.45%
Three Years       2.58%           6.53%
Since Inception   7.33%           8.25%
                                  
                                                                    
Av. Annual Return Since Incept.            8.25%
                                  
Fund Inception June 29, 1993
Calendar Year Performance

          Dreyfus        MSCI
       International    EAFE(Registered Trademark)
        Growth Fund     Index*
                           
                             
  1996         8.49%     6.05%
  1995         0.70%    11.21%
  1994        -5.44%     7.84%
                           
                           
Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may  be  worth  more or less than original cost upon  redemption.
Performance figures reflect the absorption of certain expenses by
The Dreyfus Corporation; had such expenses not been absorbed, the
Fund's  performance would have been lower.  Portfolio composition
is subject to change at any time.
*Source: Morgan Stanley Capital International.  The EAFE (Registered
Trademark) Index, which   is   an   unmanaged  index  of  non-U.S.
equity   market performance,   is   the  property  of  Morgan   Stanley
&   Co. Incorporated;  the  performance  results  shown  represent  total
return  and reflect the reinvestment of net dividends  and  other
earnings.

This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services

                     DREYFUS CASH MANAGEMENT

FUND DESCRIPTION
The  Fund's goal is to provide investors with as high a level  of
current  income as is consistent with the preservation of capital
and the maintenance of liquidity.

INVESTMENT STRATEGY
The Fund invests in short-term money market obligations including
securities  issued  or guaranteed by the U.S. Government  or  its
agencies  or  instrumentalities. During normal market conditions,
the  Fund  will  invest  at  least 25%  of  its  assets  in  bank
obligations.  The Fund is managed to keep its share price  stable
at $1.00.

INVESTOR PROFILE
Dreyfus  Cash  Management is appropriate  for  investors  seeking
current income plus stability of principal.

INVESTMENT RISKS
The  Fund  is  managed to maintain a stable  $1.00  share  price.
However,  a  money market fund investment is neither insured  nor
guaranteed by the FDIC or the U.S. Government, and there  can  be
no guarantee that the $1.00 share price will be maintained. In an
effort  to  maintain a stable share price, the  Fund  invests  in
high-quality,  short-term  paper with  remaining  maturities  not
exceeding 13 months, and maintains an average portfolio  maturity
of  90  days  or  less. Sharp interest rate  changes  and  credit
concerns  related to portfolio securities, among  other  factors,
will impact the Fund's ability to maintain its share price.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                                          Class A shares
    Management Fees                            .20%
    Total Portfolio Operating Expenses         .20%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

                         Class A shares
    One year               $    2
    Three years            $    6
    Five years             $   11
    Ten years              $   26

These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and may be greater or less than 5%.
INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment adviser.

BUYING AND SELLING SHARES THROUGH YOUR 401(K) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends are generally declared daily and paid monthly.  Capital
gains,  if  any,  generally are declared and paid  annually.  All
distributions   to  retirement  accounts  will  be  automatically
reinvested in additional Fund Share.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal.

Premier Mutual Fund Services, Distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation
DREYFUS CASH MANAGEMENT
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK    Lipper  Institutional  Money  Market  Funds
             Average.*

STRATEGY     The  Fund  invests in short-term money  market
             obligations,   including   securities   issued    or
             guaranteed  by the U.S. Government or  its  agencies
             or  instrumentalities, certificates of deposit, time
             deposits,  bankers' acceptances and other short-term
             obligations  issued  by  domestic  banks  or  London
             branches  of  domestic banks, repurchase agreements,
             and  high-grade  commercial paper and  other  short-
             term corporate obligations.

             The  Fund's  objective is to provide investors  with
             as  high  a level of current income as is consistent
             with   the   preservation   of   capital   and   the
             maintenance  of  liquidity.   The  Fund   seeks   to
             maintain  a net asset value of $1.00 per  share  for
             purchases   and  redemptions.   The   Fund's   yield
             fluctuates  and there can be no assurance  that  the
             Fund  will  be able to maintain a stable  net  asset
             value of $1.00 per share.

             The  Fund  will  maintain a dollar-weighted  average
             portfolio  maturity  of 90 days  or  less,  purchase
             only  instruments having remaining maturities of  13
             months  or  less  and  invest only  in  U.S.  dollar
             denominated  securities  determined  in   accordance
             with   procedures  established  by  the   Board   of
             Trustees  to present minimal credit risks and  which
             are  rated  in one of two highest rating  categories
             for  debt  obligations  by at least  two  nationally
             recognized statistical rating organizations (or  one
             rating  organization if the instrument was rated  by
             only  one such organization) or, if unrated, are  of
             comparable   quality.   Moreover,  the   Fund   will
             purchase  only instruments so rated in  the  highest
             rating   category  or,  if  unrated,  of  comparable
             quality  as determined in accordance with procedures
             established  by  the  Board  of  Trustees.    During
             normal  market conditions, the Fund will  invest  at
             least 25% of its assets in bank obligations.

BACKGROUND   Dreyfus  Cash Management is an open-end, diversified
             money  market mutual fund.  It commenced  operations
             in  1985.   On  January  6,  1994,  the  Fund  began
             offering two classes of shares, namely Class  A  and
             Class  B  shares.  On November 20,  1996,  the  Fund
             commenced offering two additional classes of  shares
             designated  as Administrative Shares and Participant
             shares  and the renamed Class A and Class  B  shares
             as   Institutional   Shares  and  Investor   shares,
             respectively.

             The  Fund  is designed for institutional  investors,
             particularly banks, acting for themselves  or  in  a
             fiduciary,  advisory, agency, custodial  or  similar
             capacity.    Fund  shares  may  not   be   purchased
             directly  by individuals, although institutions  may
             purchase   shares   for   accounts   maintained   by
             individuals.

MGMT. & DIST.  FEES     The management fee is payable monthly  at
             the annual  rate  of  0.20 of 1% of  the  value  of  the
             Fund's  average  daily  net assets.   Administrative
             Shares, Investor Shares and Participant Shares  bear
             certain  costs for distribution and service  at  the
             annual  rate of 0.10 of 1%, 0.25 of 1%  and  .40  of
             1%,  respectively, of the value of the average daily
             net  assets attributable to such class in accordance
             with  a service plan adopted pursuant to Rule  12b-1
             under  the  Investment  Company  Act  of  1940,   as
             amended.    No  Rule  12b-1  costs  are   borne   by
             Institutional    Shares.    Total    expenses    for
             Institutional    Shares,   Administrative    Shares,
             Investor  Shares and Participant Shares  are  capped
             at 20, 30, 45 and 60 basis points, respectively.
*Benchmark used for comparative purposes only.
             
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
DREYFUS CASH MANAGEMENT
                                
PIE CHART DEPICTING SECTOR
ALLOCATION AS OF
FEBRUARY 28, 1997

Corp Notes          6%
CD's               13%
Comm Paper         57%
US Gov't Agen      10%
ST Bank Notes       4%
Repo's             10%
Other               0%
                      
                  100%
Dreyfus Cash Management
                                
                            
General  Information
as of March 31, 1997
                                                     Institutional    Investor
                                                     Shares           Shares
                                   
Average Maturity      60 days        Assets ($Mil)      2,345.7         535.4
(2/28/97)
        
Number of Issues        87           Management Fee       0.20%         0.20%
(2/28/97)
                                     Total Expense Ratio  0.20%         0.45%
                         
                                     7-Day Yield          5.29%         5.05%
                         
Portfolio Manager      Since

P. Larkin               1991                         

+Unless The Dreyfus Corporation gives the Fund's investors at
least 90 days' notice to the contrary, The Dreyfus Corporation,
and not the Fund, will be liable for all expenses of the Fund
other than the following expenses, which will be borne by the
Fund:  (i) the management fee payable by the Fund to The Dreyfus
Corporation monthly at the annual rate of .20 of 1% of the value
of the Fund's average daily net assets; and (ii) as to
Administrative Shares, Investor Shares and Participant Shares
only, payments made at the annual rate of .10 of 1%, .25 of 1%,
 .40 of 1%, respectively, of the value of the average daily net
assets attributable to such class, pursuant to a service plan
adopted in accordance with Rule 12b-1 under the Investment
Company Act of 1940,

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED
MARCH 31, 1997 - INSTITUTIONAL SHARES

          Dreyfus Cash Mgmt  Lipper Inst'l
           (Institutional    Fd Avg**
               Shares)       
                      
1Q 97                 1.30%               1.24%
One Year              5.38%               5.12%
Three Years           5.35%               5.11%
Five Years            4.54%               4.33%
Ten Years             6.06%               5.86%
As of 3/31/97, total return for Investor Shares
for  1Q 1997  was 1.24%;  average annual  total
return  for  one  year  was  5.11%  and   since
inception on January 10, 1994 was 4.94%.
Fund Inception March 11, 1985
As of 3/31/97, total return for Investor Shares for 1Q 1997  was
1.24%;  average annual total return for one year was 5.11% and
since inception on January 10, 1994 was 4.94%.

Calendar Year Performance++
         Dreyfus        Lipper Inst'l
           Cash            MM Fund
        Management        Average**
       (Institutional           
          Shares)
                                       
  1996       5.42%          5.16%
  1995       6.01%          5.75%
  1994       4.08%          4.00%
  1993       3.17%          2.93%
  1992       3.80%          3.29%
  1991       6.22%          5.67%
  1990       8.38%          7.77%
  1989       9.51%          8.83%
  1988       7.67%          7.01%
  1987       6.67%          6.12%
                      
 ++Reflects total return each year.

An  investment  in the Fund is neither insured nor guaranteed  by
the  U.S. Government and there can be no assurance that the  Fund
will  be  able to maintain a stable net asset value of $1.00  per
share.   Past  performance  is no guarantee  of  future  results.
Yield fluctuates.  Portfolio composition is subject to change.
**Source:    Lipper  Analytical  Services,  Inc.   Reflects   the
reinvestment of income.
This  must  be  preceded  or accompanied by  the  Fund's  current
Prospectus  which  contains  additional  information   on   fees,
distribution  &  other  expenses.   Please  read  the  Prospectus
carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services

                   DREYFUS SHORT, INTERMEDIATE
                         GOVERNMENT FUND

FUND DESCRIPTION
The Fund's goal is to provide you with as high a level of current
income  as is consistent with the preservation of capital through
investments in government securities.

INVESTMENT STRATEGY
The Fund will invest primarily in securities issued or guaranteed
by  the U.S. Government or its agencies or instrumentalities  and
repurchase  agreements  in respect of such.  The  Fund  will  not
purchase any securities with remaining maturities over three  and
half years. Short to intermediate term securities are designed to
provide  generally higher income than a government  money  market
fund  and less volatility in share price than a comparable higher
yielding longer-term bond fund. Neither the market value  of  the
Fund's portfolio securities nor the value of the Fund shares  are
guaranteed or insured by the U.S. Government.

INVESTOR PROFILE
Dreyfus Short-Intermediate Government Fund may be appropriate for
investors  seeking  high current income plus  the  credit  safety
provided by investments in U.S. Government securities.

INVESTMENT RISKS
The Fund invests in bonds. Bond prices are generally affected  by
changes  in  interest rates and/or supply and demand  conditions.
Because  the  Fund  is  a U.S. Government  bond  fund,  portfolio
securities are of the highest credit quality. The prices of bonds
move  in different degrees, based on the varying impact of  these
factors  over  time, which affects the relative volatility  of  a
fund.  The  Fund can also use sophisticated investment techniques
which  involve increased risk. When you sell your shares  of  the
Fund, they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                         Class R shares

     Management fees        .50%
     Other Expenses         .25%

     Total Portfolio Operating Expenses       .75%
Example:  You  would  pay the following expenses  on  a  $1  ,000
investment  assuming ( I ) a 5% annual return and (2)  redemption
at the end of each period

                         Class R shares
     One year               $  8
     Three year             $ 24
     Five year              $ 42
     Ten year               $ 93

These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and returns may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation is the Fund's investment manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to    shareholders.   Please   consult   your   Human   Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends are declared and paid monthly. Capital gains,  if  any,
are  declared and paid annually. All distributions to  retirement
accounts  will  be  automatically reinvested in  additional  Fund
shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual fund shares are not deposits or obligations of, or
guaranteed or endorsed by, any bank and are not federally insured
by the FDIC, the Federal Reserve Board or any other agency. All
mutual fund shares involve certain investment risks, including
the possible loss of principal.

Premier Mutual Fund Services, distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
MANAGED BY THE DREYFUS CORPORATION

BENCHMARK      Merrill  Lynch  Governments, U.S.  Treasury,
               Short-Term (1-2.99 Years) Index.*

STRATEGY       The  Fund  invests in securities  issued  or
               guaranteed by the U.S. Government or its  agencies
               or  instrumentalities and repurchase agreements in
               respect of such securities.  These include:   U.S.
               Treasury Bills, Treasury Notes and Treasury Bonds;
               Government  National  Mortgage  Association  pass-
               through  certificates,  and  obligations  of   the
               Federal Home Loan Banks, Federal National Mortgage
               Association    and    Student    Loan    Marketing
               Association.   The maximum remaining  maturity  of
               any  instrument  held in the  portfolio  will  not
               exceed 3-1/2 years.

               The Fund's objective is to provide as high a level
               of  current  income  as  is  consistent  with  the
               preservation   of  capital.  The  value   of   the
               portfolio  securities held by the Fund  will  vary
               inversely to changes in prevailing interest rates.
               Neither  the market value of the Fund's  portfolio
               securities  nor the Fund's shares are  insured  or
               guaranteed  by  the U.S. Government.   The  Fund's
               share price, yield and investment return fluctuate
               and are not guaranteed.

MGMT. FEES     Dreyfus Short-Intermediate Government Fund is
               a  no-load  mutual  fund.  The management  fee  is
               payable monthly at the annual rate of 0.50  of  1%
               of  the  value  of  the Fund's average  daily  net
               assets.  Pursuant to a Shareholder Services  Plan,
               the  Fund  bears  expenses for  providing  certain
               services to the shareholders at an annual rate  of
               0.25% of 1% of the value of the average daily  net
               assets of the Fund.

               *Benchmark used for comparative purposes only.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND

PIE CHARTS DEPICTING SECTOR ALLOCATION AND MATURITY BREAKDOWN AS
OF FEBRUARY 28, 1997

      US Treas Notes     75%               < 1 Year        4%
      US Gov & Agencies  25%               1-5 Years      96%
      US Treas Strips     0%                                
      Short Term Instr    0%                                 
                                                          
                        100%                             100%
  Dreyfus Short-Intermediate       Dreyfus Short-Intermediate
             Government Fund                  Government Fund

General Information
as of March 31, 1997
                                                 
Average Maturity         2.63 Years    Management Fee+        0.50%
(2/28/97)
       
Duration (2/28/97)       2.36 Years    Total Expense Ratio+   0.75%

Number of Issues            22         Net Asset Value ($)    10.71
(2/28/97)     
                                       Assets ($Mill)         542.5
                        
Portfolio Manager          Since                      

G. Thunelius                1994

+The Dreyfus Corporation has undertaken, until November 30, 1997
that if in any fiscal year the aggregate expenses (excluding
taxes and certain other expenses) of the Fund exceed 0.75 of 1%
of the value of the Fund's average daily net assets for the
fiscal year, the Fund may deduct from the payment to be made to
Dreyfus under the Management Agreement, or Dreyfus will bear such
excess expense.

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED MARCH 31, 1997

               Dreyfus      Merrill Lynch
             Short-         Governments, U.S.
             Intermediate   Treasury, Short
             Gov't Fund     Term (1-2.99 Years)
                            Index*
                 -0.07%               0.66%
One Year          4.07%               5.32%
Three Yrs         5.45%               5.83%
Five Yrs          6.15%               5.70%
Since Inception   7.17%
Calendar Year Performance**

        Dreyfus             Merrill Lynch
         Short-              Governments,
     Intermediate            US Treasury, 
       Government             Short Term
          Fund             (1-2.99 Years)
                                Index*
                                            
  1996      3.96%               4.98%
  1995     12.61%              11.00%
  1994     -0.75%               0.57%
  1993      7.33%               5.41%
  1992      7.02%               6.30%
  1991     13.50%              11.68%
  1990     10.04%               9.72%
  1989     11.29%              10.87%
  1988      5.64%               6.22%

Past  performance  is no guarantee of future results;  net  asset
value,   yield  and  investment  return  fluctuate  so  that   an
investor's  shares may be worth more or less than  original  cost
upon redemption.  Portfolio composition is subject to change.

*Source: Bloomberg Financial Markets.   The Index is an unmanaged
performance benchmark for Treasury securities with maturities  of
1-2.99  years.   Unlike the Fund, the index does  not  take  into
account   charges,  fees  and  other  expenses.    Reflects   the
reinvestment of income dividends and, where  applicable,  capital
gains distributions.

**The Fund's performance reflects the absorption of certain  Fund
expenses by The Dreyfus Corporation. Had these expenses not  been
absorbed, the Fund's total and average annual total returns would
have been lower.
This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services
                                
                   DREYFUS S&P 500 INDEX FUND

FUND DESCRIPTION
The  Fund  seeks  to  replicate the overall  performance  of  the
Standard  & Poor's 500 Composite Stock Price Index (the "S&P  500
Index"  or the "index") primer fly through investments in  equity
securities which compose the Index. The S&P 500 Index is composed
of  500  stocks,  most  of which trade  on  the  New  York  Stock
Exchange,  and represents about 75% of the market  value  of  all
U.S. common stocks.

INVESTMENT STRATEGY
The Fund seeks to be fully invested in the common stocks included
in  the S&P 500 Index; at least 80% of the Fund's assets will  be
so invested. To maintain liquidity, the Fund may invest 5% of its
assets  in Short-Term securities. Each stock composing the  Index
is  weighted by its market capitalization relative to  the  total
market value of the Index, and the Fund's port folio seeks to  be
constructed in the same manner.

INVESTOR PROFILE
The  Dreyfus S&P 500 Index Fund may be appropriate for  investors
seeking  a  simplified and diversified approach to  stock  market
investing through investment in a stock index fund.

INVESTMENT RISKS
The  Fund  invests  principally in common  stocks  composing  the
Index.  Stock  prices  move  up  and  down  in  response  to  the
performance  of  their issuers and general  economic  and  market
factors. The prices of stocks move in different degrees, based on
the  varying impact of these factors over time, which affects the
relative  volatility  of a fund. The Fund can  use  sophisticated
investment   techniques  including  investments   in   derivative
instruments. The Fund's performance will be directly impacted  by
the  performance  of  the  Index.  Because  a  large  number   of
securities  compose  the  Index,  the  Fund  will  have   greater
difficulty replicating the performance of the Index to the extent
that  its assets are not sufficient to appropriately construct  a
representative portfolio. When you sell your shares of the  Fund,
they may be worth more or less than what you paid for them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

     Management Fee                 .30%
     Other Expenses                 .25%
     Total Fund Operating Expenses  .55%

Example:  You  would  pay  the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption  at
the end of each period.

     One year                 $ 6
     Three years              $18
     Five years               $31
     Ten years                $69
These amounts should not be considered representative of past  or
future  expenses and actual expenses may be greater or less  than
those  indicated.  Moreover, the Fund's actual  performance  will
vary and may be greater or less than 5%.

INVESTMENT ADVISER
The  Dreyfus  Corporation serves as the  Fund's  manager.  Mellon
Equity Associates serves as the Fund's index manager.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS
Dividends and capital gains, if any, generally are declared and
paid annually. All distributions to retirement accounts will be
automatically reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal,

Premier Mutual Fund Services, Distributor
Copyright-1996 Dreyfus Retirement Services, a division of Dreyfus Service
Corporation
DREYFUS INSTITUTIONAL S&P 500 STOCK INDEX FUND*

BENCHMARK      Standard & Poor's 500 Composite Stock  Price
               Index with dividends reinvested.

STRATEGY       The  Fund's  objective is to  replicate  the
               total   return  of  the  Standard  &  Poor's   500
               Composite  Stock Price Index ("S&P 500  Index"  or
               "Index")  primarily through investments in  equity
               securities.   There can be no assurance  that  the
               Fund's objective will be achieved.

PROCESS        The  Fund  is  not  managed  according   to
               traditional   methods   of   "active"   investment
               management, which involves the buying and  selling
               of  securities based upon economic, financial  and
               market analysis and investment judgment.  Instead,
               the Fund utilizes a "passive" investment approach,
               attempting to duplicate the investment performance
               of   the   S&P   500  Index  through   statistical
               procedures.

               The S&P 500 Index is composed of 500 common stocks
               that are selected by Standard & Poor's Corporation
               to  capture best the price performance of a  large
               cross-section  of the U.S. publicly  traded  stock
               market.   The 500 securities, most of which  trade
               on   the   New  York  Stock  Exchange,   represent
               approximately 75% of the market value of all  U.S.
               common stocks.  Each stock in the S&P 500 Index is
               weighted  by its market capitalization.  That  is,
               each  security  is  weighted by its  total  market
               value  relative to the total market value  of  all
               the  securities  in the S&P 500 Index.   Component
               stocks  included in the S&P 500 Index  are  chosen
               with  the aim of achieving a distribution  at  the
               index   level   representative  of   the   various
               components  of the U.S. economy and  therefore  do
               not   represent   the   500   largest   companies.
               Aggregate  market value and trading  activity  are
               also considered in the selection process.

               As the Fund's assets increase, the Fund expects to
               invest  in all 500 stocks in the S&P 500 Index  in
               proportion  to  their  weighting  in  the   Index,
               including Mellon Bank Corporation stock.   To  the
               extent  that the size of the Fund does not  permit
               it  to invest in all 500 stocks in the Index,  the
               Fund  will  purchase  a representative  sample  of
               stock  from each industry sector included  in  the
               Index  in  proportion to that industry's weighting
               in  the Index.  To the extent that the Fund  seeks
               to replicate the S&P 500 Index using such sampling
               techniques, a close correlation between the Fund's
               performance  and the performance of the  Index  is
               anticipated  in  both rising and falling  markets.
               The Fund attempts to achieve a correlation between
               the performance of its investments and that of the
               Index  of  at  least  0.95,  before  deduction  of
               expenses.   A correlation of 1.00 would  represent
               perfect   correlation  between  Fund   and   Index
               performance.    It   is   anticipated   that   the
               correlation of the Fund's performance to  that  of
               the  Index will increase as the size of  the  Fund
               increases.    The   Fund's  ability   to   achieve
               significant  correlation between  Fund  and  Index
               performance   may  be  affected  by   changes   in
               securities markets, changes in the composition  of
               the   Index  and  the  timing  of  purchases   and
               redemptions   of   Fund  shares.    Under   normal
               circumstances, the Fund invests at  least  95%  of
               its  assets in the common stocks included  in  the
               Index.

               "S&P 500" is a trademark of McGraw Hill, Inc.  and
               has  been  licensed  for use.   The  Fund  is  not
               sponsored, sold, endorsed or promoted by S&P,  and
               S&P   makes   no   representation  regarding   the
               advisability of investing in the Fund.
MGMT. & DIST. FEES   The Fund's management fee is computed  daily
               and  paid monthly at the annual rate of  0.20%  of
               the  Fund's average daily net assets less  certain
               expenses.   Effective  September  15,  1995,   the
               Fund's  management fee was reduced from  0.40%  to
               0.20%,   the   Fund's  name  changed  to   Dreyfus
               Institutional  S&P 500 Stock Index  Fund  and  the
               Fund's  separate   share class  designations  were
               eliminated  and  the Fund became  a  single  class
               fund.   Currently, the Fund's minimum initial  and
               subsequent investment requirements are $25,000 and
               $1,000,  respectively.  Please see the  Prospectus
               for further details.
          
               *  A  separate  portfolio  of  The  Dreyfus/Laurel
               Funds, Inc.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
DREYFUS INSTITUTIONAL S&P 500 STOCK INDEX FUND
                                
PIE CHART DEPICTING SECTOR ALLOCATION AS OF MARCH 31, 1997
Health Care            10%
Energy                 10%
Utilities               9%
Interest Sens          15%
Consumer Staples       14%
Consumer Cyc/Disc      12%
Capital Spending       23%
Basic Industry          5%
Other                   2%
Cash                    0%
                          
                      100%

PIE CHART DEPICTING ASSET ALLOCATION AS OF MARCH 31, 1997

Common Stock           98%
Equit. Cash             2%
                          
                      100%

   Ten Largest Holdings                      Other Information
   as of March 31, 1997                    as of March 31, 1997

General             2.8%                          
 Electric

Coca-               2.4%                 Assets ($Mill)       500.0
 Cola                 

Exxon               2.3%                 Management Fee       0.20%
 
Intel               2.0%                 Total Expense Ratio  0.20%

Microsoft           1.9%                 Net Asset Value     $16.32
                                         Per Share
Merck & Co.         1.8%                            

Philip Morris       1.6%                            

Royal Dutch         1.6%                 Portfolio Manager    Since
 Petroleum

Procter & Gamble    1.4%                 Steve Falci         Inception

IBM                 1.2%                          
* Effective September 15, 1995, the Fund's separate share class
designations were eliminated and the Fund became a single class
fund.

BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS ENDED MARCH 31, 1997

                                 Dreyfus        
                              Institutional        S&P
                              S&P 500 Stock        500
                                  Index         (w/divs)**

1Q 97                               2.58%          2.68%
One Year                           19.49%         19.82%
Three Years                        21.78%         22.30%
Since Inception                    17.96%         18.30%
                                                        
Av. Annual Return Since Incept.                   18.30%
                   
Fund Inception September 30, 1993
Calendar Year Performance+

     Dreyfus Institutional           S&P
       S&P 500 Stock                 500
        Index Fund                 Index**
                     
                             
1996        22.76%                  22.96%
1995        36.82%                  37.58%
1994         0.83%                   1.32%
                             
+Reflects total return.

Past  performance is no guarantee of future results; share  price
and  investment return fluctuate so that an investor's shares may
be  worth  more  or  less  than  original cost  upon  redemption.
Effective  September  15,  1995, the Fund's  management  fee  was
reduced from .40% to .20% of the Fund's average daily net assets;
and  the Fund's separate share class designations were eliminated
and  the  Fund  became  a  single class  fund.   Since  inception
performance results reflect the performance of the Fund's  former
Class R shares (which were not subject to a Rule 12b-1 fee)  from
inception  on September 30, 1993 through September 14,  1995  and
the  performance of the Fund's single class of shares thereafter.
Portfolio composition is subject to change at anytime.
**  Source: Lipper Analytical Services, Inc.  The S&P 500  is  an
unmanaged index of stock market performance; performance  results
represent  total return and reflect the reinvestment of dividends
and other earnings.
This  must  be  preceded or accompanied by a  current  Prospectus
which  contains  additional information  on  fees  and  expenses.
Please read the Prospectus carefully before investing.

                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services

                 DREYFUS DISCIPLINED STOCK FUND

FUND DESCRIPTION
The Dreyfus Disciplined Stock Fund seeks investment returns that
are consistently higher than the Standard & Poor's 500 Composite
Stock  Price Index (" S&P 500 Index"), by investing in a broadly
diver'  sifted  list of equity securities. The Fund  is  not  an
index fund.

INVESTMENT STRATEGY
Individual  security selection is the foundation of  the  Fund's
investment  approach.  The  Fund  will  use  sophisticated  risk
control  techniques  in  selecting  securities.  Consistency  of
returns  which  exceed the S&P 500 and stability of  the  Fund's
asset  value  relative to the S&P 500 are primary goals  of  the
investment  process.  Valuation  models  are  used  to  form   a
computerized ranking system which will select common stocks that
appear  to  be  over  or  undervalued.  The  system  will   then
categorize individual securities within each industry  according
to relative attractiveness. Fundamental analysis then determines
the most attractive of the top-rated securities and those issues
that should be sold. Under normal circumstances, at least 65% of
the  Fund's  total assets will be invested in equity securities.
For  defensive purposes the Fund can invest up to  20%  in  high
quality money market secu' rities.

INVESTOR PROFILE
This  Fund  may  be appropriate for investors seeking  long-term
growth  from  a portfolio composed of common stocks selected  by
the use of sophisticated quantitative analysis and techniques.

INVESTMENT RISKS
The Fund invests principally in stocks. Stock prices move up and
down in response to the performance of their issuers and general
economic  and  market  factors. The prices  of  stocks  move  in
different degrees, based on the varying impact of these  factors
over time, which affects the relative volatility of a fund.  The
Fund's  investment process uses a disciplined  control  of  fund
risk  and  a  rigorous security selection. Risk  is  managed  by
controlling potential size, growth rate, financial condition and
earnings variability. The structure of the Fund is controlled so
that characteristics such as economic sector, industry exposure,
growth,  size, volatility and quality are maintained similar  to
those of the S&P 500 at all times. When you sell your shares  of
the  Fund, they may be worth more or less than what you paid for
them.

EXPENSES
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)

                  Class R shares
   Management fees        .90%
       12b- 1 Fees        None
    Other Expenses        .00%
Total Portfolio Operating Expenses .90%
Example:  You  would  pay the following  expenses  on  a  $1,000
investment assuming (1) a 5% annual return and (2) redemption at
the end of each period.

                     Class R shares
          One year        $  9
          Three year      $ 29
          Five year       $ 50
          Ten year        $111

These  amounts should not be considered representative of future
expenses  and actual expenses may be greater or less than  those
indicated.  Moreover,  the Portfolio's actual  performance  will
vary and may be greater or less than 5%.

INVESTMENT ADVISER
The Dreyfus Corporation serves as the Fund's investment adviser.
The Fund is managed by Burt Mullins, portfolio manager of Dreyfus
and a vice president for Mellon Bank, N.A., Dreyfus' parent
company.

BUYING AND SELLING SHARES THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment  options available under your plan. A Fund's  exchange
privilege  may be modified or terminated at any time upon  notice
to   shareholders.  Please  consult  with  your  Human  Resources
Representative  for  specific  information  on  these  and  other
related matters, including withdrawals from your plan.

DISTRIBUTIONS

Dividends,  if  any,  are  declared and paid  quarterly.  Capital
gains,  if  any,  generally are declared and paid  annually.  All
distributions   to  retirement  accounts  will  be  automatically
reinvested in additional Fund shares.

  THIS RETIREMENT PLAN PROSPECTUS CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
 PLAN. IF YOU WOULD LIKE A COMPLETE PROSPECTUS BEFORE ALLOCATING
     ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO THIS
     INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Mutual  fund  shares  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, any bank and are not federally insured
by  the FDIC, the Federal Reserve Board or any other agency.  All
mutual  fund  shares involve certain investment risks,  including
the possible loss of principal.

The Fund is a separate Portfolio of The Dreyfus/Laurel Funds, Inc.

Premier Mutual Fund Services, Distributor
Copyright-1995  Dreyfus Retirement Services, a division of Dreyfus Service
Corporation
DREYFUS DISCIPLINED STOCK FUND*

BENCHMARK      Standard & Poor's 500 Composite Stock  Price
               Index.**

STRATEGY       The Fund seeks investment returns (including
               capital   appreciation  and  income)  consistently
               superior  to  the Standard & Poor's 500  Composite
               Stock  Price Index ("S&P 500 Index") by  investing
               in a broadly diversified list of equity securities
               generated   by  the  application  of  quantitative
               security selection and risk management techniques.
               There can be no assurance that the Fund will  meet
               its  stated  investment objective.   Under  normal
               market  conditions, at least  65%  of  the  Fund's
               total   assets   will   be  invested   in   equity
               securities.   A  certain percentage  of  assets  -
               typically less than 20% - may be placed  in  high-
               quality  money  market  securities  for  liquidity
               purposes.   The Fund's share price and  investment
               return  fluctuate  such that an investor's  shares
               may  be worth more or less than original cost upon
               redemption.

PROCESS        Individual   security  selection   is   the
               foundation  of  the  Fund's  investment  approach.
               Consistency  of returns which exceed the  S&P  500
               Index  and  stability of the  Fund's  asset  value
               relative to the S&P 500 Index are primary goals of
               the investment process.  More than 1,600 stocks of
               well-established   companies   are   analyzed   by
               computer, using up to 15 sophisticated statistical
               models.   The  result  is a  measurement  of  each
               stock's  attractiveness  based  on  many  factors,
               including  earnings  momentum, relative  valuation
               and dividend discount calculations, price to book,
               price to earnings and return on equity ratios.

               Next,    senior   investment   analysts   assemble
               information  on  individual  securities  collected
               from   a   variety   of   sources.    Using   both
               quantitative   and  fundamental  techniques,   the
               managers refine the relative ranking of stocks.

               This   investment  process  utilizes   disciplined
               management of fund risk and a process of  rigorous
               security  selection.   Risk  is  managed  in  that
               portfolio characteristics such as economic sector,
               industry  exposure, growth, size,  volatility  and
               quality are maintained similar to those of the S&P
               500 Index at all times.  Common stocks held in the
               Fund,  most  but  not all of which pay  dividends,
               typically  include  a  broad range  of  investment
               characteristics.  The Fund is not  an  index  fund
               and  its investments are not limited to securities
               of issuers in the S&P 500 Index.

MGMT. & DIST. FEES   The Fund's management fee is computed  daily
               and  paid  monthly at the annual rate of 0.90%  of
               the  Fund's average daily net assets less  certain
               expenses.   In order to compensate the  Investment
               Manager  for  paying virtually all of  the  Fund's
               expenses, the Fund's management fee is higher than
               the   management  fee  paid  by  most   investment
               companies.  Please see the Prospectus for complete
               details.  The Fund currently offers two classes of
               shares.  Effective July 15, 1996, the Fund's Class
               R  shares  were redesignated as Retail shares  and
               are  offered to any investor.  Also effective July
               15,   1996,   the  Fund's  Investor  shares   were
               redesignated  as  Institutional  shares  and   are
               offered  only  to  clients  of  banks,  securities
               brokers    or   dealers   and   other    financial
               institutions  that  have entered  into  a  Selling
               Agreement with the Fund's distributor and  omnibus
               accounts  held by institutions that  provide  sub-
               accounting  or  recordkeeping  services  to  their
               clients.      Existing     Institutional     class
               shareholders    may    continue    to     purchase
               Institutional shares whether or not they otherwise
               would   be   eligible  to  do  so.    The   Fund's
               Institutional shares currently are  subject  to  a
               Distribution Plan adopted pursuant to  Rule  12b-1
               under  the  Investment Company Act of  1940.   The
               Plan  allows the Fund to spend annually  0.25%  of
               its  average  daily  net  assets  attributable  to
               Institutional shares.  Please refer to the  Fund's
               Prospectus which contains more information on  the
               Fund's share classes.
*  A  separate  portfolio  of  The  Dreyfus/Laurel
                  Funds, Inc.
               ** Benchmark used for comparative purposes only.
               
                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                      Copyright-1997  Dreyfus Service Corporation
DREYFUS DISCIPLINED STOCK FUND
                                
PIE CHARTS DEPICTING SECTOR ALLOCATION VERSUS BENCHMARK AS OF
MARCH 31, 1997

Fund                              Index     Health Care         9%
        Health Care        10%              Energy             10%
        Energy             10%              Utilities           9%
        Utilities           9%              Interest Sens      15%
        Interest Sens      15%              Consumer           12%
                                            Cyclical
        Consumer           12%              Consumer           14%
        Cyclical                            Staples
        Consumer           13%              Capital            23%
        Staples                             Spending
        Capital            23%              Basic Industry      5%
        Spending
        Basic               5%              Other               3%
        Industry
        Other               3%                                  0%
        Cash                0%                                       
                          100%                                100%
Dreyfus Disciplined Stock Fund              S&P 500 Index

Ten Largest Holdings                 Other Information
as of March 31, 1997                as of March 31, 1997

General Electric     2.8%                                    Retail
                                                             Shares* 
Intel                2.5%                

Coca-Cola            2.5%           Assets ($Bill)            1.015
        
Exxon Corp.          2.3%           Total Expense Ratio       0.90%

Microsoft            2.2%           Port. Turnover Rate+     64.47%
                          
Merck & Co.          2.1%           Net Asset Value ($)       26.57
                  
Phillip Morris Cos.  1.5%                        

Bell South Corp.     1.4%           Primary Portfolio Mgr     Since

IBM                  1.4%           Bert Mullins            Inception
        
Proctor & Gamble     1.4%                        
 
* Effective July 15, 1996, the Fund's Class R shares were redesignated as
  Retail shares.
+ As of 10/31/96.

              Dreyfus        S&P 500
             Disciplined    (w/divs)*
             Stock
             (Retail)
1Q 97                 0.64%      2.68%
One Year             18.80%     19.82%
Three Yrs            20.78%     22.30%
Five Yrs             16.23%     16.42%
Since Inception      16.42%     16.46%
                                      
                                      
Av. Annual Return Since Incept.             16.46%

Fund Inception December 31, 1987
Calendar Year Performance

       Dreyfus               S&P
      Disciplined            500
      Stock Fund           Index*
       (Retail                  
       Shares)
                          
1996     24.88%            22.96%
1995     36.86%            37.58%
1994     -1.04%             1.32%
1993     11.83%            10.06%
1992      7.58%             7.61%
1991     33.64%            30.40%
1990      0.23%            -3.11%
1989     34.33%            31.63%
1988     10.72%            16.56%
                          

Past  performance is no guarantee of future results; share  price
and  investment  return fluctuate such that an investor's  shares
may  be  worth  more or less than original cost upon  redemption.
Effective  July  15,  1996,  the  Fund's  Class  R  shares   were
redesignated  as Retail shares and are offered to  any  investor.
These performance figures relate to Retail shares only; the  Fund
also  offers Institutional shares. Institutional shares, but  not
Retail shares, are subject to a 0.25% Rule 12b-1 plan.  Portfolio
composition is subject to change at any time.
*Source:  Lipper Analytical Services, Inc.  The  S&P  500  is  an
unmanaged index of stock market performance.  Performance results
represent total return and reflect reinvestment of dividends.
This  must  be  preceded or accompanied by a  current  Prospectus
which contains additional information on fees, expenses and share
classes.   Please read the Prospectus carefully before investing.
                                   Premier Mutual Fund Services -
                                                      Distributor
                                60 State Street-Boston, MA  02109
DREYFUS
                       Retirement Services
                                
                    CAPITAL PRESERVATION FUND

FUND DESCRIPTION
The  Capital  Preservation Fund is a collective  investment  fund
that  seeks  high current income and stability of  principal.  It
invests  primarily in Guaranteed Investment Contracts (GICs)  and
similar  instruments  including  alternative  GICs  and  separate
account GICs.

Guaranteed  Investment Contracts are popular investment  vehicles
for  retirement  plans. GICs are contracts  issued  by  insurance
companies  that  guarantee stated rates  of  return  on  invested
assets  for  the  life  of  these contracts  and  the  return  of
principal at maturity.

INVESTMENT STRATEGY
The  Fund  will  invest  primarily in GICs  that  are  issued  by
insurance  companies meeting certain credit  criteria  and  other
similar  instruments  including  alternative  GICs  and  separate
account GICs. In addition, the Fund may also invest in repurchase
agreements,   private   placements,  certificates   of   deposit,
commercial paper, shares of registered investment companies, bank
investment contracts and corporate investment contracts.

INVESTOR PROFILE
This  Fund  may  be  appropriate for investors looking  for  high
current income with stability of principal.

INVESTMENT RISKS
There  can  be  no  assurance  that the  Fund  will  achieve  its
investment  objective  of high current income  and  stability  of
principal.  While  LaSalle  National Trust,  N.A.  will  seek  to
maintain  the  stability of the value of units  in  the  Fund  at
approximately one dollar ($1.00) per unit, neither the  value  of
the Fund's portfolio nor an investment in the Fund is insured  or
guaranteed and there can be no assurance that the value of  units
in  the Fund will not fluctuate. The Fund risks possible loss  of
principal  if  an issuer is unable to pay on or before  maturity.
Units  in  the  Fund  are  not deposits  or  obligations  of,  or
guaranteed or endorsed by, LaSalle National Trust, N.A.,  or  any
other  bank,  credit  union or insurance  company,  and  are  not
insured by the Federal Deposit Insurance Corporation, the Federal
Reserve Board, or any other agency.

ANNUAL FEE
LaSalle National Trust, N.A. charges each employee benefit  trust
participating  in  the Capital Preservation Fund  an  annual  fee
which covers LaSalle National Trust, N.A.'s fee for managing  the
Fund   and   The  Dreyfus  Trust  Company's  fee  for  performing
sub-accounting  and administrative services with respect  to  the
Fund.  The annual fee is generally 0.50 of 1% of each trust's  or
plan's  average daily net assets invested in the Fund. The annual
fee is accrued daily and paid on a monthly basis.

TRUSTEE AND PORTFOLIO MANAGER
LaSalle National Trust, N.A., based in Chicago, Illinois, is  the
Fund's  portfolio  manager. LaSalle National  Trust,  N.A.  is  a
subsidiary of ABN/AMRO Bank, N.V. While The Dreyfus Trust Company
performs certain sub-accounting and administrative services  with
respect to the Fund, LaSalle National Trust, N.A., as trustee and
portfolio  manager, is solely responsible for the management  and
investment performance of the Fund's portfolio.
BUYING AND SELLING UNITS THROUGH YOUR 401(k) PLAN
Your  plan  sponsor  has  established  specific  procedures   for
enrolling in the plan, for allocating contributions to the  Fund,
and  for  making  exchanges  or  transfers  among  the  different
investment options available under your plan. Please consult with
your  Human Resources Representative for specific information  on
these and other related matters, including withdrawals from  your
plan.

DISTRIBUTIONS
Income distributed from the Fund will be applied to the purchase
of additional units in the Fund.

           THIS MATERIAL CONTAINS SUMMARY INFORMATION
  CONCERNING ONE OF THE INVESTMENT OPTIONS AVAILABLE UNDER YOUR
  PLAN. IF YOU WOULD LIKE A COMPLETE PRODUCT DESCRIPTION BEFORE
  ALLOCATING ALL OR A PORTION OF YOUR RETIREMENT PLAN ASSETS TO
   THIS INVESTMENT OPTION, PLEASE CONTACT YOUR HUMAN RESOURCES
                         REPRESENTATIVE.

Copyright-1996 The Dreyfus Trust Company. Trustee
CAPITAL PRESERVATION FUND (CPF)
MANAGED BY LASALLE NATIONAL TRUST, N.A.

STRATEGY       The Fund is a collective investment fund for
               employee   benefit  trusts  and  plans   investing
               primarily in guaranteed investment contracts, bank
               investment  contracts, money  market  instruments,
               separate   account  structures   and   alternative
               investment contracts.  The investment objective of
               the  Fund  is  stability  of  principal  and  high
               current income.

               All   GICs   purchased  will  be  from   insurance
               companies  which,  at the time  of  issuance,  are
               rated  at  least A by the A.M. Best Company,  Inc.
               In  addition, they will carry at least  a  minimum
               Townsend  &  Schupp rating of A-.   All  companies
               rated  by  Standard  &  Poor's,  at  the  time  of
               purchase,  must  carry  a AA-  rating.   All  U.S.
               Treasury and Agency obligations are considered  to
               be AAA equivalents.  All other investments will be
               from  an  approved  list  of  bank  and  corporate
               issuers.

               The  maximum average maturity of the fund will  be
               three years.  No GIC/BIC will be purchased with  a
               maturity  over  5 years.  Any alternative  GIC/BIC
               purchased will have an average life limited  to  6
               years.  In addition, the fund generally will  hold
               approximately  5% in money market instruments  and
               at least 20% of the fund's investments will mature
               in less than one year.

               The  portfolio  is  managed  by  LaSalle  National
               Trust, N.A.,  a pioneer in the development of  GIC
               funds.   In seeking its dual goals of high current
               income   and  principal  stability,  the   Capital
               Preservation   Fund's   management    follows    a
               conservative  investment  approach.    Safety   of
               principal is the primary concern.

               LaSalle  National  Trust,  N.A.  will  attempt  to
               maintain  the stability of the value of  units  in
               the  Fund  at approximately one dollar ($1.00  per
               unit).  However, the value of the Fund's portfolio
               is  not  guaranteed and there can be no  assurance
               that  the  value  of units in the  Fund  will  not
               fluctuate.

PROCESS        All   issuers  must  meet  minimum   credit
               standards  from several private and public  rating
               services.   While  high current income  and  price
               stability    are    important   concerns,    other
               considerations include:

               Diversification: The     portfolio     is
                                diversified  among  multiple  GIC
                                issuers,  which can  help  reduce
                                risk.

               Liquidity:       Benefit payments and  other
                                distributions  (e.g.   exchanges)
                                generally  can  be  made  without
                                long     delays    and    without
                                penalties   such   as   surrender
                                charges.
ANNUAL FEE     LaSalle National Trust, N.A. charges each employee
               benefit  trust participating in the CPF an  annual
               fee  which  covers LaSalle National Trust,  N.A.'s
               fee  for  managing the CPF and The  Dreyfus  Trust
               Company's  fee  for performing sub-accounting  and
               administrative services with respect to  the  CPF.
               The  annual  fee is generally 0.50 of 1%  of  each
               trust's   or  plan's  average  daily  net   assets
               invested  in the CPF.  The annual fee  is  accrued
               daily and paid on a monthly basis.

                       PREMIER MUTUAL FUND SERVICES - DISTRIBUTOR
                               60 State Street - Boston, MA 02109
                       Copyright-1997 Dreyfus Service Corporation
CAPITAL PRESERVATION FUND

   Ten Largest Holdings
   as of April 3, 1997
                                   
CDC Invest Man Corp Alternative                 11.2%

Nat'l Westminster Bank Alternative               9.4%

General Reinsurance Alternative                  8.4%

Gov't Money Mkt Instr.                           8.4%

JP Morgan Alternative                            8.0%
 
Rabobank Alternative                             7.8%
  
Peoples Security Life Alternative                7.2%
 
Pacific Mutual Alternative                       6.5%

John Hancock Actively Managed Alternative        5.2%

Commonwealth Life Alternative                    5.0%

Capital Preservation Fund

Pie Chart Depicting Maturity
Breakdown as of April 3, 1997
                     
< 1 Year          20%
1 - 2 Years       15%
2 - 3 Years       23%
3 - 4 Years       10%
4 - 6 Years       32%
                     
                 100%

Portfolio Characteristics
as of April 3, 1997
                                               
Weighted Avg Maturity               2 years,  10 months

Number of Issuers                         19

Assets ($Bill)                           2.04
BAR GRAPH DEPICTING PERFORMANCE FOR PERIODS
ENDED MARCH 31, 1997
              Capital
            Preservation
                Fund
1Q 97           1.54%     
One Year        6.38%     
Three Years     6.33%     
Five Years      6.36%     
Ten Years       7.50%     

Calendar Year Performance
                            
Capital Preservation Fund
                            
  1996            6.38%        
  1995            6.38%        
  1994            6.11%        
  1993            6.12%     
  1992            7.10%     
  1991            8.38%     
  1990            8.87%     
  1989            8.90%     
  1988            8.77%     
  1987            8.56%     
                               
Past   performance  is  no  guarantee  of  future  results.    An
investment  in the CPF is neither insured nor guaranteed  by  the
U.S.   Government.   Units  in  the  CPF  are  not  deposits   or
obligations  of,  or guaranteed or endorsed by, LaSalle  National
Trust,  N.A. or any other bank, and are not Federally insured  by
the  Federal  Deposit Insurance Corporation, the Federal  Reserve
Board,  or any other agency.  While LaSalle National Trust,  N.A.
will  attempt to maintain the stability of the value of units  in
the  CPF at approximately one dollar per unit, the value  of  the
CPF's  portfolio is not guaranteed and there can be no  assurance
that the value of units in the CPF will not fluctuate.  The CPF's
performance  shown  here  does  not  reflect  The  Dreyfus  Trust
Company's  fee  for  providing subaccounting  and  administrative
services for the CPF.
                                                                 
Please see the current Product Description for more complete
information.
COMPANY STOCK

     The following information regarding the Company Stock
investment option has been provided by the Company.

     ON DECEMBER 23, 1996, WESTMORELAND COAL COMPANY AND FOUR
SUBSIDIARIES, WESTMORELAND RESOURCES, INC., WESTMORELAND COAL
SALES COMPANY, WESTMORELAND ENERGY, INC., AND WESTMORELAND
TERMINAL COMPANY (THE "DEBTOR CORPORATIONS"), FILED VOLUNTARY
PETITIONS FOR REORGANIZATION UNDER CHAPTER 11 OF THE UNITED
STATES BANKRUPTCY CODE IN THE UNITED STATES BANKRUPTCY COURT FOR
THE DISTRICT OF COLORADO.  AT THE DATE OF THIS PROSPECTUS, THE
DEBTOR CORPORATIONS ARE IN POSSESSION OF THEIR RESPECTIVE
PROPERTIES AND ASSETS AND ARE OPERATING AS DEBTORS IN POSSESSION
PURSUANT TO PROVISIONS OF THE BANKRUPTCY CODE.  NO ASSURANCE CAN
BE GIVEN THAT THE DEBTOR CORPORATIONS WILL BE SUCCESSFUL IN
REORGANIZING THEIR AFFAIRS WITHIN THE CHAPTER 11 BANKRUPTCY
PROCEEDINGS.  REGARDLESS OF WHETHER THE DEBTOR CORPORATIONS ARE
SUCCESSFUL IN THIS EFFORT, THE RIGHTS AND BENEFITS ATTACHED TO
THE COMPANY'S COMMON STOCK AND PREFERRED STOCK ARE SUBJECT TO
MODIFICATION BY THE BANKRUPTCY COURT, AND THESE MODIFICATIONS CAN
SIGNIFICANTLY REDUCE OR ELIMINATE THE VALUE OF THESE SECURITIES.

     Contributions to the Company Stock fund will be used to
purchase Company Stock at prevailing market prices. Company Stock
was traded on the New York Stock Exchange ("NYSE") through
December 23, 1996 under the symbols "WCX" for the Common Stock
and "WCXPRA" for the Depositary Shares.  Prices shown below for
this period are the high and low sales prices on the NYSE.  From
December 24, 1996 through February 6, 1997, there was not an
established public trading market for the Company Stock.  Since
February 7, 1997, the Company Stock has been traded over-the-
counter under the symbols "WMCLQ" for the Common Stock and
"WMCCQ" for the Depositary Shares and reported on the Over-The-
Counter Bulletin Board. Prices shown below for the latter period
are the range of high and low bid quotations as reported by the
National Quotation Bureau.  The bid quotations are inter-dealer
bid prices without allowance for mark-ups, mark-downs or
commissions and may not necessarily reflect actual transactions.

                    Common Stock        Depository Shares
                                                       Quarterly
                    High      Low        High     Low  Dividend
1994
First Quarter       5 7/8   4 1/4       20      15 1/4   .53125
Second Quarter      5 1/4   4 3/8       16 1/4  13 1/2    -
Third Quarter       6 3/8   4 3/8       18 3/4  15 1/4    -
Fourth Quarter      7 1/8   3 3/4       17 7/8  14        -

1995
First Quarter       6 5/8   4 1/2       19      14 1/4   .53125
Second Quarter      5 3/8   4 1/4       14 3/4  12       .53125
Third Quarter       4 1/2   2 1/2       13 1/2  9         -
Fourth Quarter      3 5/8   2 1/2       10 1/4  6         -
1996

First Quarter       3 5/8   2 1/2       7 7/8    6        -
Second Quarter      4 1/4   2 3/4       12 7/8   7 1/2    -
Third Quarter       2 1/2   2 3/4       9 7/8    8 3/4    -
Fourth Quarter      3 3/8   1           10       6 3/8    -
    (through December 23)

1997

First Quarter       7/8     1/2         5 3/4    2         -
    (after February 6)
Second Quarter      15/16   17/32       5 1/2    5         -
Third Quarter       1       15/16       5 1/4    5 1/8     -
 (through July 28)

On July 28, 1997, the closing bid price for the Company's Common
Stock was $1 and the closing bid price for the Company's
Depository Shares was $ 5-1/8.  As with other stocks, the value
of the Company Stock can fluctuate and your investment can
increase or decrease in value depending upon the market
performance of Company Stock.

DIVIDENDS

The Company has not paid cash dividends on its Common Stock since
the fourth quarter of 1992. Future payments of cash dividends, if
any, will be determined by the Board of Directors based upon
circumstances then existing, including, without limitation,
contractual restrictions and the financial condition, capital
requirements, cash flow, profitability and business outlook of
the Company.  Common Stock dividends may not be declared until
the Preferred Stock dividends that are in arrears are made
current.

Preferred Stock dividends at the annual rate of $2.125 per
Depositary Share were paid quarterly from the third quarter of
1992 through the first quarter of 1994.  The declaration and
payment of Preferred Stock dividends was suspended in the second
quarter of 1994 in connection with extension agreements of the
Company's principal lenders.  Upon the expiration of these
extension agreements, the Company paid a quarterly dividend on
April 1, 1995 and July 1, 1995. Pursuant to the requirements of
Delaware law, the Preferred Stock dividend was suspended in the
third quarter of 1995 as a result of recognition of losses and
the subsequent shareholders' deficit. As of the date of this
Prospectus, there are ten quarterly dividends in arrears
(dividend payment dates  July 1, 1994, October 1, 1994, January
1, 1995, October 1, 1995,  January 1, 1996, April 1, 1996, July
1, 1996, October 1, 1996, January 1, 1997 and April 1, 1997 and
July 1, 1997) in the total amount of $13,441,000 in the aggregate
($5.84375 per Depositary Share).

There are statutory restrictions limiting the payment of
Preferred Stock dividends under Delaware law, the state in which
the Company is incorporated.  Under Delaware law, the Company is
permitted to pay Preferred Stock dividends only: (1) out of
surplus, surplus being the amount of shareholders' equity in
excess of the par value of the Company's two classes of stock; or
(2) in the event there is no surplus, out of net profits for the
fiscal year in which a Preferred Stock dividend is declared
(and/or out of net profits from the preceding fiscal year), but
only to the extent that shareholders' equity exceeds the par
value of the Preferred Stock ($575,000).
As a result of the filing by the Company of a voluntary petition
for reorganization under Chapter 11 of the United States
Bankruptcy Code, the Company is prohibited from paying dividends,
either on the Common Stock or the Preferred Stock.

                                        July 30, 1997

                           *    *    *

     This document constitutes part of a prospectus covering
         securities that have been registered under the
                     Securities Act of 1933.
APPENDIX B TO
            SUMMARY PLAN DESCRIPTION AND PROSPECTUS
                      DATED JULY 30, 1997

               DESCRIPTION OF THE PREFERRED STOCK

  The  statements  under this caption relating to  the  Preferred
Stock  are  summaries and do not purport  to  be  complete.  Such
summaries make use of certain terms defined in the Certificate of
Designation for  the Series A Convertible Exchangeable  Preferred
Stock  (the  "Certificate of Designation") and are  qualified  in
their  entirety  by  express  reference  to  the  Certificate  of
Designation, a copy of which is incorporated by reference as   an
exhibit to the Registration Statement of which this Prospectus is
a  part. Summaries herein of certain  provisions of the Company's
Certificate  of  Incorporation, as amended (the  "Certificate  of
Incorporation"), do not purport to be complete  and  are  subject
and  qualified in their entirety by reference  to all  provisions
of  the Certificate of Incorporation. As used under this caption,
the  term "Company"  refers only to Westmoreland Coal Company and
not to its subsidiaries.

GENERAL

  The  authorized capital stock of the Company includes 5,000,000
shares  of preferred stock, par  value $1.00 per share, of  which
575,000  shares, represented by 2,300,000 Depositary Shares,  are
currently outstanding.

RANKING

  The  Preferred Stock ranks prior to the Company's Common Stock.
Without the requisite vote of  holders of the Preferred Stock  as
described  below  under  "Limitations," no  class  or  series  of
capital  stock  can be created ranking pari passu with or  senior
to  the  Preferred  Stock as to dividend  rights  or  liquidation
preference.

DIVIDEND RIGHTS

   The  holders of the Preferred Stock are entitled  to  receive,
when, as and if  declared by the Company's Board of Directors out
of  funds of the Company legally available therefor  (and subject
to  the  limitation  described  in  the  last  sentence  of  this
paragraph), cumulative cash dividends  at the rate of 8-1/2%  per
annum  per  share (equivalent to $2.125 per annum per  Depositary
Share),   payable  quarterly on April 1, July 1,  October  1  and
January  1 in each year. Such dividends shall be cumulative  from
the  date  of original issuance. The Company will pay each   such
dividend to the holders of record of the Preferred Stock as  they
appear on its stock register on the  record date, which shall not
be more than 30 days nor less than 10 days preceding the dividend
payment  date.  If  a holder converts shares of  Preferred  Stock
after the close of business on the record date for a dividend and
before  the  opening  of business on the payment  date  for  such
dividend,  the holder will be required to pay to the  Company  at
the  time  of  such conversion the amount of such dividend.   See
"Conversion" below.
THE COMPANY HAS NOT PAID DIVIDENDS ON THE PREFERRED STOCK SINCE
JULY  1,  1995  AND  AT  THE DATE OF THIS  PROSPECTUS  IS  ELEVEN
QUARTERLY DIVIDENDS IN ARREARS (INCLUDING UNPAID DIVIDENDS  PRIOR
TO  JULY 1, 1997).  SEE "APPENDIX A, AVAILABLE INVESTMENT OPTIONS
- COMPANY STOCK DIVIDENDS."

  If  dividends  are not paid in full, or declared  in  full  and
sums  set apart for the payment thereof, upon the Preferred Stock
and any other preferred stock ranking on a parity as to dividends
with  the  Preferred  Stock,  all  dividends  declared  upon  the
Preferred Stock and any other preferred stock ranking on a parity
as  to dividends will be paid or declared pro rata so that in all
cases  the amount of dividends paid or declared per share on  the
Preferred Stock and such other preferred stock will bear to  each
other  the  same  ratio  that accumulated  dividends  per  share,
including  dividends  accrued or  in  arrears,  if  any,  on  the
Preferred  Stock  and such other preferred  stock  bear  to  each
other. Except as provided in the preceding sentence, unless  full
cumulative  dividends on the Preferred Stock have  been  paid  or
declared  in full and sums set aside for the payment thereof,  no
dividends  (other than dividends in Common Stock or other  shares
of  the  Company's capital stock ranking junior to the  Preferred
Stock as to dividends) may be paid or declared and set aside  for
the  payment or other distribution made upon the Common Stock or,
except  as  provided  above, on any other capital  stock  of  the
Company ranking junior to or on a parity with the Preferred Stock
as  to  dividends, nor may any Common Stock or any other  capital
stock  ranking junior to or on a parity with the Preferred  Stock
as  to dividends be redeemed, purchased or otherwise acquired for
any  consideration  (or any payment made to or  available  for  a
sinking  fund for the redemption of any shares of such stock)  by
the  Company  or  any  subsidiary  of  the  Company  (except   by
conversion  into  or exchange for capital stock  of  the  Company
ranking junior to the Preferred Stock as to dividends).

  Dividends  payable on the Preferred Stock for any  period  less
than  a  full quarterly dividend period will be computed  on  the
basis  of  a 360-day year of twelve 30-day months and the  actual
number of days elapsed in the period for which payable.

CONVERSION RIGHTS

  Holders   of   the  Preferred  Stock  will  have   the   right,
exercisable at any time and from time to time, except in the case
of Preferred Stock called for redemption or to be exchanged for 8-
1/4%  Convertible Subordinated Debentures due June 15, 2002  (the
"Exchange  Debentures"), to convert all  or  any  such  Preferred
Stock into shares of the Common Stock at the conversion price  of
$14.64  per  share of Common Stock (equivalent  to  a  conversion
ratio of 1.708 shares of Common Stock for each Depositary Share),
subject  to  adjustment as described below. In the  case  of  the
Preferred  Stock  called for redemption or to  be  exchanged  for
Exchange  Debentures, conversion rights will expire at the  close
of  business on the business day immediately preceding  the  date
fixed for redemption or on the business day immediately preceding
the  exchange  date, as the case may be. Notice  of  an  optional
redemption must be mailed not less than 30 days and not more than
60  days  prior  to  the  redemption date.  Upon  conversion,  no
adjustment  or repayment will be made for dividends, but  if  any
holder surrenders a share of Preferred Stock for conversion after
the  close  of business on the record date for the payment  of  a
dividend  and  prior  to  the opening of  business  on  the  next
dividend payment date, then, notwithstanding such conversion, the
dividend  payable on such dividend payment date will be  paid  to
the  registered holder of such share on such record date. In such
event,  such  share,  when surrendered for  conversion,  must  be
accompanied by payment of an amount equal to the dividend payable
on  such  dividend  payment date on the share  so  converted.  No
fractional  shares  of  the  Common Stock  will  be  issued  upon
conversion  and,  if  the  conversion  results  in  a  fractional
interest,  an amount will be paid in cash equal to the  value  of
such  fractional interest based on the market price of the Common
Stock on the last trading day prior to the date of conversion.
The  conversion price is subject to adjustment upon the occurr
ence  of certain events, including (i) the issuance of shares  of
Common  Stock as a dividend or distribution on the Common  Stock;
(ii)  the  subdivision or combination of the  outstanding  Common
Stock;  (iii) the issuance to substantially all holders of Common
Stock  of rights or warrants to subscribe for or purchase  Common
Stock  (or securities convertible into Common Stock) at  a  price
per  share less than the then current market price per share,  as
defined  in the Certificate of Designation; (iv) the distribution
to  all holders of Common Stock of shares of capital stock of the
Company  (other than Common Stock), evidences of indebtedness  or
other  assets  (excluding dividends in cash  out  of  current  or
retained earnings); and (v) the distribution to substantially all
holders  of  Common Stock of rights or warrants to subscribe  for
securities (other than those referred to in clause (iii)  above).
In  the  event of a distribution to substantially all holders  of
Common Stock of rights to subscribe for additional shares of  the
Company's  capital stock (other than those referred to in  clause
(iii) above), the Company may, instead of making an adjustment in
the  conversion price, make proper provision so that each  holder
of  a  share of Preferred Stock who converts such Preferred Stock
shall be entitled to receive upon such conversion, in addition to
shares  of Common Stock, an appropriate number of such rights  or
warrants.  No  adjustment of the conversion price  will  be  made
until cumulative adjustments amount to one percent or more of the
conversion  price  as  last  adjusted.  No  adjustment   of   the
conversion price will be made for cash dividends.

  If  the  Company reclassifies or changes its outstanding Common
Stock, or consolidates with or merges into or transfers or leases
all  or substantially all its assets to any person, or is a party
to  a  merger that reclassifies or changes its outstanding Common
Stock, the Preferred Stock will become convertible into the  kind
and  amount of securities, cash or other assets which the holders
of  the  Preferred Stock would have owned immediately  after  the
transaction  if  the  holders had converted the  Preferred  Stock
immediately before the effective date of the transaction.

  Conversion of shares of the Preferred Stock may be effected  by
delivering  certificates evidencing such  shares,  together  with
written  notice  of  conversion and a proper assignment  of  such
certificates to the Company or in blank, to the office or  agency
to  be maintained by the Company for that purpose. Initially such
office  will  be the principal corporate office of First  Chicago
Trust  Company of New York located at 30 West Broadway, New York,
New York, 10007.
LIQUIDATION PREFERENCE

  In  the event of any liquidation, dissolution, or winding up of
the affairs of the Company, whether voluntary or otherwise, after
payment or provision for payment of the Company's debts and other
liabilities, the holders of the Preferred Stock will be  entitled
to  receive, out of the remaining net assets of the Company,  the
amount  of  $100  in cash for each share of the  Preferred  Stock
(equivalent to $25 per Depositary Share), plus an amount in  cash
equal  to all dividends accrued and unpaid on each such share  up
to  the  date fixed for distribution, before any distribution  is
made  to  the  holders of the Common Stock or any  other  capital
stock of the Company ranking (as to any such distribution) junior
to  the Preferred Stock. If upon any liquidation, dissolution  or
winding  up  of the Company, the assets distributable  among  the
holders  of  shares of Preferred Stock and all other classes  and
series  of  preferred stock ranking (as to any such distribution)
on  a  parity with the Preferred Stock are insufficient to permit
the  payment  in full to the holders of all such  shares  of  all
preferential amounts payable to all such holders, then the entire
assets  of  the  Company thus distributable will  be  distributed
ratably  among  the holders of the Preferred  Stock  and  of  all
classes  and  series of preferred stock ranking (as to  any  such
distribution) on a parity with the Preferred Stock in  proportion
to the respective amounts that would be payable per share if such
assets were sufficient to permit payment in full.

  For  purposes of this section, a distribution of assets in  any
dissolution, winding up or liquidation will not include  (i)  any
consolidation  or merger of the Company with or  into  any  other
corporation,  (ii) any dissolution, liquidation, winding  up,  or
reorganization   of   the   Company   immediately   followed   by
reincorporation of another corporation or (iii) a sale  or  other
disposition  of all or substantially all of the Company's  assets
to  another  corporation; provided that, in each case,  effective
provision  is  made  in the certificate of incorporation  of  the
resulting  and surviving corporation or otherwise for the  protec
tion of the rights of the holders of Preferred Stock.

OPTIONAL REDEMPTION

The Preferred Stock may be redeemed at the option of the Company,
in  whole or from time to time in part, at any time on and  after
July  1,  1996, at the following redemption prices per  share  if
redeemed during the twelve-month period beginning July 1  of  the
year  indicated below, plus, in each case, all dividends  accrued
and  unpaid  on  the  Preferred Stock up to the  date  fixed  for
redemption, upon giving notice as provided below:

                    Redemption Price
                    (Per Share of         Dollar Equivalent
          Year      Preferred Stock)     Per Depositary Share

          1996          $105.10                  $26.28
          1997           104.25                   26.06
          1998           103.40                   25.85
          1999           102.55                   25.64
          2000           101.70                   25.43
          2001           100.85                   25.21
          2002
          and thereafter 100.00                   25.00
If  fewer  than  all of the outstanding shares of  the  Preferred
Stock  are  to  be  redeemed, the shares to be redeemed  will  be
determined  pro  rata  or  by lot or  in  such  other  manner  as
prescribed by the Company's Board of Directors.

  At  least  30 days but not more than 60 days prior to the  date
fixed for the redemption of the Preferred Stock, a written notice
will be mailed to each holder of record of Preferred Stock to  be
redeemed,  notifying  such holder of the  Company's  election  to
redeem such shares, stating the date fixed for redemption thereof
(the  "Preferred Stock Redemption Date"), and calling  upon  such
holder  to  surrender  to  the Company  on  the  Preferred  Stock
Redemption  Date  at  the place designated  in  such  notice  the
certificate  or  certificates representing the number  of  shares
specified  therein.  On or after the Preferred  Stock  Redemption
Date,  each holder of Preferred Stock to be redeemed must present
and surrender his certificate or certificates for such shares  to
the  Company at the place designated in such notice and thereupon
the  redemption price of such shares will be paid to  or  on  the
order  of  the  person whose name appears on such certificate  or
certificates   as   the  owner  thereof  and   each   surrendered
certificate  will be canceled. Should fewer than all  the  shares
represented   by  any  such  certificate  be  redeemed,   a   new
certificate  will  be issued representing the unredeemed  shares.
From  and  after the Preferred Stock Redemption Date (unless  the
Company  defaults  in  payment  of  the  redemption  price),  all
dividends  on  the shares of the Preferred Stock  designated  for
redemption in such notice will cease to accrue and all rights  of
the  holders thereof as shareholders of the Company,  except  the
right  to  receive  the redemption price thereof  (including  all
accrued and unpaid dividends up to the Preferred Stock Redemption
Date),  will  cease  and  terminate  and  such  shares  will  not
thereafter  be  transferred  (except  with  the  consent  of  the
Company)  on  the Company's books, and such shares shall  not  be
deemed  to  be  outstanding for any purpose  whatsoever.  At  its
election,  the  Company, prior to the Preferred Stock  Redemption
Date,  may  deposit  the redemption price of the  shares  of  the
Preferred Stock so called for redemption in trust for the holders
thereof  with a bank or trust company, in which case such  notice
to  holders  of the shares of the Preferred Stock to be  redeemed
will  (i) state the date of such deposit, (ii) specify the office
of  such  bank  or trust company as the place of payment  of  the
redemption  price and (iii) call upon such holders  to  surrender
the  certificates representing such shares at such  place  on  or
after the date fixed in such redemption notice (which may not  be
later  than the Preferred Stock Redemption Date), against payment
of  the  redemption price (including all accrued and unpaid  divi
dends  up to the Preferred Stock Redemption Date). Any moneys  so
deposited  which remain unclaimed by the holders of the Preferred
Stock  at  the  end  of  two  years  after  the  Preferred  Stock
Redemption Date will be returned by such bank or trust company to
the Company.

EXCHANGE

   At  the Company's option, all, but not less than all,  of  the
then  outstanding shares of the Preferred Stock may be  exchanged
on  any dividend payment date commencing July 1, 1996, subject to
certain  conditions  stated  below, for  the  Company's  Exchange
Debentures on not less than 30 days nor more than 60 days notice,
at  an  exchange  rate  of  $100  principal  amount  of  Exchange
Debentures  for each share of the Preferred Stock (equivalent  to
$25  principal amount of Exchange Debentures for each  Depositary
Share).  Such  exchange  may be made only  if,  at  the  time  of
exchange   (i)   the   Exchange  Indenture  (as   defined   under
"Description  of  the  Exchange  Debentures")  shall  have   been
qualified under the Trust Indenture Act of 1939, (ii) there shall
be  no  dividend arrearage on the Preferred Stock (including  the
dividend  payable on the date of exchange) and (iii) no Event  of
Default under the Exchange Indenture shall have occurred  and  be
continuing.  The  Exchange  Indenture  may  not  be  amended   or
supplemented before the date of exchange without the  affirmative
vote  or  consent  of  the holders of two-thirds  of  outstanding
shares  of  the  Preferred Stock, except that no  amendment  that
would  adversely  affect  the legal  rights  of  the  holders  of
Exchange Debentures may be taken without the affirmative vote  or
consent of all the holders of the outstanding shares of Preferred
Stock.  At  the  exchange  date, the rights  of  holders  of  the
Preferred Stock shall cease and the person or persons entitled to
receive Exchange Debentures issuable upon such exchange shall  be
treated  as  the  registered holder or holders of  such  Exchange
Debentures.  Interest will accrue on the Exchange Debentures from
the date of exchange.
VOTING RIGHTS

   Each share of Preferred Stock shall entitle the holder thereof
to four votes on any matter on which the holders of the Company's
capital  stock have the right to vote, including the election  of
directors. In addition, holders of the Preferred Stock will  have
voting rights (i) as provided under "Limitations" below, (ii)  in
the event the Company shall have failed to declare and pay or set
apart  for payment in full the preferential dividends accumulated
on the outstanding Preferred Stock for any six quarterly dividend
payment   periods,  whether  or  not  consecutive  (a   "Dividend
Non-Payment"), and (iii) as required by law. In the  event  of  a
Dividend Non-Payment, the number of directors of the Company will
be  increased by two and the holders of the outstanding Preferred
Stock,  voting  together as a class with  all  other  classes  or
series  of preferred stock ranking on a parity with the Preferred
Stock  with  respect to dividends or distribution of assets  upon
liquidation  and  then entitled to vote on the election  of  such
additional  directors,  will  be  entitled  to  elect  such   two
additional directors until the full dividends accumulated on  all
outstanding Preferred Stock shall have been declared and paid  or
set  apart  for payment.  Pursuant to this provision,  Robert  E.
Killen  and James W. Sight were elected as directors at a special
meeting  of  holders of the Depositary Shares held  in  September
1996.

LIMITATIONS

  In  addition to any other rights provided by applicable law, so
long  as  any shares of the Preferred Stock are outstanding,  the
Company  will not, without the affirmative vote, or  the  written
consent as provided by law, of the holders of at least two-thirds
of  the  outstanding shares of the Preferred Stock, voting  as  a
class:

     (a) authorize or issue any class or series of, or rights  to
     subscribe to or any security convertible into, capital stock
     ranking pari passu with or senior to the Preferred Stock  as
     to payment of
     dividends,  in  distribution of assets upon  liquidation  or
     voting rights; or
     
     (b) change the preferences, rights or powers with respect to
     the  Preferred  Stock  so as to affect  such  capital  stock
     adversely.

   Except as may otherwise be required by applicable law, such  a
class vote or consent is not required (i) in connection with  any
increase  in  the  total number of authorized  shares  of  Common
Stock,  or (ii) in connection with the authorization or  increase
of  any  class  or series of shares ranking, as to dividends  and
distribution of assets upon liquidation, junior to the  Preferred
Stock.  No  such  vote or written consent of the holders  of  the
Preferred Stock is required if, at or prior to the time when  the
issuance  of any such stock ranking prior to the Preferred  Stock
is  to be made or any such change is to take effect, as the  case
may  be,  provision  is made for the redemption  of  all  of  the
Preferred  Stock at the time outstanding. The Company  may  issue
its  presently  authorized but unissued  shares  of  its  capital
stock,   or  bonds,  notes,  mortgages,  debentures,  and   other
obligations,  and  incur  indebtedness  to  banks  and  to  other
lenders.  Certain changes in the Exchange Indenture  (as  defined
below)  may  not  be  effected without the  affirmative  vote  or
consent of the holders of two-thirds of the outstanding shares of
the   Preferred   Stock.  See  "Description   of   the   Exchange
Debentures-General."
PREEMPTIVE RIGHTS

  No  holder  of the Preferred Stock will have preemptive  rights
to subscribe for or acquire any unissued shares of the Company or
securities of the Company convertible into or carrying a right to
subscribe to or acquire shares.

TRANSFER AGENT

  The  Registrar,  Transfer Agent and Conversion  Agent  for  the
Preferred  Stock is First Chicago Trust Company of New York.  The
Company will act as Paying Agent for the Preferred Stock.
  

              DESCRIPTION OF THE DEPOSITARY SHARES

GENERAL

  The  Company  has issued receipts ("Depositary  Receipts")  for
Depositary  Shares, each of which represents  one  quarter  of  a
share   of  Preferred  Stock.  The  shares  of  Preferred   Stock
represented  by Depositary Shares are deposited under  a  Deposit
Agreement  (the  "Deposit Agreement") among  the  Company,  First
Chicago  Trust  Company  of New York (the "Depositary")  and  the
holders from time to time of the Depositary Receipts. Subject  to
the  terms  of the Deposit Agreement, each owner of a  Depositary
Share is entitled, in proportion to the applicable fraction of  a
share of Preferred Stock represented by such Depositary Share, to
all the rights and preferences of the Preferred Stock represented
thereby  (including dividend, voting, conversion, redemption  and
liquidation rights).

  The  Depositary  Shares  are evidenced by  Depositary  Receipts
issued pursuant to the Deposit Agreement.  Copies of the forms of
Deposit Agreement and Depositary Receipt may be obtained from the
Company  upon request, and the following summary is qualified  in
its entirety by reference thereto.
DIVIDENDS AND OTHER DISTRIBUTIONS

  The   Depositary  distributes  all  dividends  or  other   cash
distributions received in respect of the Preferred Stock  to  the
record  holders of Depositary Shares in proportion to the  number
of  such  Depositary  Shares owned by such  holders,  subject  to
certain  obligations of holders to file proofs, certificates  and
other information and to pay certain charges and expenses to  the
Depositary.

  In  the  event  of  a  distribution other  than  in  cash,  the
Depositary would distribute property received by it to the record
holders of Depositary Shares entitled thereto, subject to certain
obligations  of  holders to file proofs, certificates  and  other
information  and  to  pay certain charges  and  expenses  to  the
Depositary,  unless  the Depositary determines  that  it  is  not
feasible  to make such distribution, in which case the Depositary
may,  with  the approval of the Company, sell such  property  and
distribute the net proceeds from such sale to such holders.

WITHDRAWAL OF STOCK

   Upon surrender of the Depositary Receipts at the corporate  tr
ust  office  of  the  Depositary (unless the  related  Depositary
Shares have previously been called for redemption), the holder of
the  Depositary Shares evidenced thereby is entitled to delivery,
at  such  office  to or upon his order, of the  number  of  whole
shares  of  the  Preferred Stock and any money or other  property
represented  by  such  Depositary Shares. Holders  of  Depositary
Shares  will be entitled to receive whole shares of the Preferred
Stock on the basis of one share of Preferred Stock for each  four
Depositary Shares, but holders of such whole shares of  Preferred
Stock  will  not  thereafter be entitled  to  receive  Depositary
Shares  therefor.  If the Depositary Receipts  delivered  by  the
holder  evidence a number of Depositary Shares in excess  of  the
number  of  Depositary Shares representing the  number  of  whole
shares  of  Preferred Stock to be withdrawn, the Depositary  will
deliver  to such holder at the same time a new Depositary Receipt
evidencing such excess number of Depositary Shares.

REDEMPTION OF DEPOSITARY SHARES

   Whenever the Company redeems shares of Preferred Stock held by
the  Depositary,  the  Depositary will  redeem  as  of  the  same
redemption  date  the  number of Depositary  Shares  representing
shares  of  the referred Stock so redeemed, provided the  Company
shall have paid in full to the Depositary the redemption price of
the  Preferred Stock to be redeemed plus an amount equal  to  any
accrued  and  unpaid  dividends thereon to  the  date  fixed  for
redemption.  The redemption price per Depositary  Share  will  be
equal  to  the redemption price and any other amounts  per  share
payable with respect to the Preferred Stock. If less than all the
Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by the Depositary by lot or pro rata or
other equitable method, in each case as may be determined by  the
Company.
VOTING THE PREFERRED STOCK

   Upon receipt of notice of any meeting at which the holders  of
the  Preferred  Stock are entitled to vote, the  Depositary  will
mail  the information contained in such notice of meeting to  the
record  holders  of the Depositary Shares relating  to  Preferred
Stock. Each record holder of such Depositary Shares on the record
date  (which  will be the same date as the record  date  for  the
Preferred Stock) is entitled to instruct the Depositary as to the
exercise  of  the  voting  rights pertaining  to  the  amount  of
Preferred  Stock represented by such holder's Depositary  Shares.
The Depositary will endeavor, insofar as practicable, to vote the
amount  of Preferred Stock represented by such Depositary  Shares
in   accordance  with  such  instructions,  and  the  Company  is
obligated  to  take  all reasonable action which  may  be  deemed
necessary by the Depositary in order to enable the Depositary  to
do  so.  The  Depositary  will  abstain  from  voting  shares  of
Preferred  Stock  to  the  extent it does  not  receive  specific
instructions  from the holders of Depositary Shares  representing
Preferred Stock.

CONVERSION OF PREFERRED STOCK

  The Depositary Shares, as such, are not convertible into Common
Stock  or  any  other  securities or  property  of  the  Company.
Nevertheless,  the  Depositary Receipts  may  be  surrendered  by
holders   thereof to the Depositary with written instructions  to
the Depositary to instruct the Company to cause conversion of the
Preferred Stock represented by the Depositary Shares evidenced by
such  receipts into whole shares of Common Stock, and the Company
has agreed that upon receipt of such instructions and any amounts
payable  in respect thereof, it will cause the conversion thereof
utilizing  the same procedures as those provided for delivery  of
Preferred  Stock  to effect such conversions. If  the  Depositary
Shares represented by a Depositary Receipt are to be converted in
part  only, a new Depositary Receipt or Receipts will  be  issued
for  any  Depositary Shares not to be converted. See "Description
of Preferred Stock-Conversion Rights."

     EXCHANGE OF PREFERRED STOCK

   Whenever  the Company exchanges all of the shares of Preferred
Stock  held  by  the  Depositary  for  Exchange  Debentures,  the
Depositary  will  exchange  as of  the  same  exchange  date  all
Depositary Shares representing all of the shares of the Preferred
Stock  so exchanged for Exchange Debentures, provided the Company
shall  have  issued  and deposited with the  Depositary  Exchange
Debentures  for all of the shares of the Preferred  Stock  to  be
exchanged. The exchange rate per Depositary Share shall be  equal
to one quarter of the exchange rate per share of Preferred Stock,
plus  all money and other property, if any, represented  by  such
Depositary  Shares, including all amounts paid by the Company  in
respect  of dividends which on the exchange date have accrued  on
the  shares  of Preferred Stock to be so exchanged and  have  not
theretofore been paid.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT

  The  form  of  Depositary  Receipt  evidencing  the  Depositary
Shares and any provision of the Deposit Agreement may at any time
be  amended  by agreement between the Company and the Depositary.
However,  any amendment that materially and adversely alters  the
rights  of the holders of Depositary Shares will not be effective
unless  such  amendment has been approved by the  holders  of  at
least  a majority (or, in the case of amendments relating  to  or
affecting rights to receive dividends or distributions or voting,
redemption  or  conversion rights, two-thirds) of the  Depositary
Shares then outstanding.

  The  Deposit  Agreement may be terminated by the  Company  upon
not  less  than  60  days' notice whereupon the Depositary  shall
deliver  or make available to each holder of Depositary Receipts,
upon  surrender of the Depositary Receipts held by  such  holder,
such  number  of  whole or fractional shares of  Preferred  Stock
represented   by  such  receipts.  The  Deposit  Agreement   will
automatically terminate if (i) all outstanding Depositary  Shares
have  been redeemed, (ii) there has been a final distribution  in
respect   of   the  Preferred  Stock  in  connection   with   any
liquidation,  dissolution or winding up of the Company  and  such
distribution  has been distributed to the holders  of  Depositary
Receipts  or (iii) each share of Preferred Stock shall have  been
converted into shares of Common Stock.

CHARGES OF DEPOSITARY

  The   Company  will  pay  all  transfer  and  other  taxes  and
governmental  charges arising solely from the  existence  of  the
Depositary  arrangements.  The Company  will  pay  the  fees  and
expenses of the Depositary in connection with the performance  of
its  duties  under the Deposit Agreement. Holders  of  Depositary
Receipts  must  pay  transfer and other  taxes  and  governmental
charges and such other charges as are expressly provided  in  the
Deposit Agreement to be for their accounts.

MISCELLANEOUS

  The  Depositary  will forward to holders of  Depositary  Shares
any  reports  and  communications  from  the  Company  which  are
received by the Depositary.

  Neither the Depositary nor the Company will be liable if it  is
prevented from or delayed in, by law or any circumstances  beyond
its   control,  performing  its  obligations  under  the  Deposit
Agreement.  The  obligations of the Company  and  the  Depositary
under  the  Deposit  Agreement are limited  to  performing  their
duties  thereunder without negligence or willful misconduct,  and
the Company and the Depositary are not obligated to prosecute  or
defend  any legal proceeding in respect of any Depositary  Shares
or   any   Preferred  Stock  unless  satisfactory  indemnity   is
furnished. The Company and the Depositary may rely on  advice  of
counsel  or  accountants,  or  information  provided  by  persons
presenting  Preferred  Stock for deposit, holders  of  Depositary
Shares  or  other persons believed to be authorized or  competent
and on documents believed to be genuine.

  In  the  event the Depositary shall receive conflicting claims,
requests or instructions from any holders of Depositary Receipts,
on  the  one  hand,  and  the Company, on  the  other  hand,  the
Depositary  shall be entitled to act on such claims, requests  or
instructions received from the Company.
RESIGNATION AND REMOVAL OF DEPOSITARY

The  Depositary  may  resign at any time  by  delivering  to  the
Company notice of its election to do so, and the Company  may  at
any  time remove the Depositary, any such resignation or  removal
to  take,  effect upon the appointment of a successor Depositary,
which successor Depositary must be appointed within 60 days after
delivery  of the notice of resignation or removal and must  be  a
bank  or trust company having its principal office in the  United
States  and  having a combined capital and surplus  of  at  least
$50,000,000.

             DESCRIPTION OF THE EXCHANGE DEBENTURES
                                
GENERAL

  The  Exchange  Debentures will, if and when issued,  be  issued
under  an indenture (the "Exchange Indenture") to be dated as  of
the  date  of  issuance  (the "Exchange Date")  of  the  Exchange
Debentures,  between  the  Company and  Fidelity  Bank,  National
Association  (the "Exchange Trustee").  A copy  of  the  proposed
form of the Exchange Indenture is incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus is
a part. The Exchange Indenture may not be amended or supplemented
before  the Exchange Date without the affirmative vote or consent
of  the  holders of two-thirds of the outstanding shares  of  the
Preferred  Stock, except that no amendment that  would  adversely
affect the legal rights of the holders of Exchange Debentures may
be  taken  without  the affirmative vote or consent  of  all  the
holders   of  the  Preferred  Stock.  The  summaries  of  certain
provisions of the Exchange Indenture hereunder do not purport  to
be  complete  and  are  subject to, and are  qualified  in  their
entirety  by reference to, all of the provisions of the  Exchange
Indenture, including the definitions therein of certain terms and
those  terms made part of the Exchange Indenture by reference  to
the  Trust Indenture Act of 1939 as in effect on the date of  the
Exchange Indenture.

  The  Exchange  Debentures will bear interest from the  Exchange
Date at the rate of 8-1/2% per annum payable on April 1, July  1,
October  1  and January 1 in each year, commencing on  the  first
such interest payment date next succeeding the Exchange Date,  to
holders  of  record ("Holders") at the close of business  on  the
first  day  of  the  month  of such interest  payment  date.  The
Exchange Debentures will be due on July 1, 2012, will be issued in
registered  form, without coupons, only in denominations  of  $25
and  integral multiples of $25 and will be unsecured  obligations
of   the  Company  which  will  be  subordinated  to  the  Senior
Indebtedness   of  the  Company.  The  Indenture  authorizes   an
aggregate  principal  amount  of  $57,500,000  of  the   Exchange
Debentures.
CONVERSION

  The  holder  of  any Exchange Debenture will  have  the  right,
exercisable  at  any  time  prior to  maturity,  to  convert  the
principal  amount  thereof (or any portion  thereof  that  is  an
integral  multiple  of $25) into shares of Common  Stock  at  the
conversion  price set forth on the cover page of this Prospectus,
subject   to  adjustment  as  described  below  (the  "Conversion
Price"),  except  that  if an Exchange Debenture  is  called  for
redemption, the conversion right will terminate at the  close  of
business on the business day immediately preceding the date fixed
for redemption. Upon conversion, no adjustment or payment will be
made  for interest or dividends, but if any holder surrenders  an
Exchange Debenture for conversion after the close of business  on
the record date for the payment of an installment of interest and
prior  to  the  opening of business on the next interest  payment
date, then, notwithstanding such conversion, the interest payable
on  such  interest  payment date will be paid to  the  registered
holder  of such Exchange Debenture on such record date.  In  such
event,   such   an  Exchange  Debenture,  when  surrendered   for
conversion, must be accompanied by payment of an amount equal  to
the interest payable on such interest payment date on the portion
so converted. No fractional shares will be issued upon conversion
but  a  cash adjustment will be made for any fractional interest.
The  Conversion  Price  is  subject to  adjustment  in  a  manner
substantially  identical to that provided  with  respect  to  the
Preferred    Stock.   See   "Description   of    the    Preferred
Stock-Conversion."

OPTIONAL REDEMPTION

   The  Exchange Debentures may be redeemed at the option of  the
Company, in whole or from time to time in part, on and after July
1,  1996,  on not less than 30 nor more than 60 days'  notice  by
first  class mail, at the following redemption prices  (expressed
as  percentages of the principal amount) if redeemed  during  the
twelve-month period beginning July 1 of the year indicated below,
in  each  case, together with accrued and unpaid interest thereon
to the redemption date:

             Year                         Price
             1996                         105.10%
             1997                         104.25
             1998                         103.40
             1999                         102.55
             2000                         101.70
             2001                         100.85
             2002 and thereafter          100.00

  If  less  than all the Exchange Debentures are to be  redeemed,
the  Trustee  will select Exchange Debentures for redemption  pro
rata  or  by lot. If any Exchange Debenture is to be redeemed  in
part  only,  a  new Exchange Debenture or Exchange Debentures  in
principal  amount  equal  to  the  unredeemed  principal  portion
thereof will be issued.
PURCHASE OF EXCHANGE DEBENTURES AT THE OPTION OF THE HOLDER UPON
A CHANGE IN CONTROL

  If  any  Change  in Control (as defined below) of  the  Company
occurs   on  or  prior  to  maturity,  each  holder  of  Exchange
Debentures  will have the right, at the holder's option,  subject
to  the  terms  and conditions of the Indenture, to  require  the
Company  to purchase all or any part (equal to $25 or an integral
multiple thereof) of the holder's Exchange Debentures on the date
that  is 35 business days after the occurrence of such Change  in
Control  (the "Change in Control Purchase Date") at a cash  price
equal to principal amount plus accrued and unpaid interest to the
Change  in Control Purchase Date (the "Change in Control Purchase
Price").

  Within  15  business  days after the  Change  in  Control,  the
Company  is obligated to mail to the Trustee and each  holder  of
Exchange  Debentures  (and to beneficial owners  as  required  by
applicable law) a written notice of the Change in Control,  which
notice  shall state, among other things (i) the events causing  a
Change  in  Control and the date of such Change in Control,  (ii)
the last date on which the purchase right may be exercised, (iii)
the  Change in Control Purchase Price, (iv) the Change in Control
Purchase Date, (v) the name and address of the Trustee and of any
other  office  or  agency  maintained  for  the  purpose  of  the
surrender  of  Exchange  Debentures for purchase,  and  (vi)  the
procedures  that holders of Exchange Debentures  must  follow  to
exercise  these  rights. The Company will cause a  copy  of  such
notice to be published in the national edition of The Wall Street
Journal.

  To  exercise this right, the holder must deliver written notice
(a "Change in Control Purchase Notice") to the Trustee, or to any
other office or agency designated by the Company, of the exercise
of  such  right prior to the close of business on the  Change  in
Control Purchase Date. The Change in Control Purchase Notice must
state  (i) the certificate numbers of the Exchange Debentures  to
be  delivered by the holder thereof for purchase by the  Company,
(ii)  the  portion of the principal amount of Exchange Debentures
to  be  purchased,  which portion must  be  $25  or  an  integral
multiple thereof, and (iii) that such Exchange Debentures are  to
be  purchased  by  the Company on the Change in Control  Purchase
Date  pursuant  to  the  applicable provisions  of  the  Exchange
Debentures.

  Any  Change in Control Purchase Notice may be withdrawn by  the
holder  by  a  written  notice  of withdrawal  delivered  to  the
Trustee,  or  to  any other office or agency  designated  by  the
Company, prior to the close of business on the Change in  Control
Purchase Date. The notice of withdrawal shall state the principal
amount and the certificate numbers of the Exchange Debentures  to
which the withdrawal notice relates and the principal amount,  if
any,  which  remains subject to the original  Change  in  Control
Purchase  Notice  and  which has been or will  be  delivered  for
purchase by the Company.

  Payment of the Change in Control Purchase Price for an Exchange
Debenture for which a Change in Control Purchase Notice has  been
delivered and not withdrawn is conditioned upon delivery of  such
Exchange Debenture (together with necessary endorsements) to  the
Trustee,  or  to  any other office or agency  designated  by  the
Company, at any time (whether prior to, on or after the Change in
Control  Purchase Date) after delivery of such Change in  Control
Purchase Notice. Payment of the Change in Control Purchase  Price
for  such Exchange Debenture will be made promptly following  the
later  of  the  Change in Control Purchase Date or  the  time  of
delivery  of  such Exchange Debenture. If the Trustee  holds,  in
accordance with the Indenture, money sufficient to pay the Change
in  Control  Purchase  Price of such Exchange  Debenture  on  the
Change  in  Control Purchase Date, then, as of the  business  day
following  the  Change in Control Purchase  Date,  such  Exchange
Debenture  shall  cease to be outstanding and  interest  on  such
Exchange  Debenture  will cease to accrue, whether  or  not  such
Exchange  Debenture is delivered to the Trustee or to  any  other
office  or  agency  maintained for such purpose,  and  all  other
rights  of  the holder shall terminate (other than the  right  to
receive the Change in Control Purchase Price upon delivery of the
Exchange Debenture).

  Under  the  Indenture,  a "Change in Control"  of  the  Company
means  the  occurrence  after the date  thereof  of  any  of  the
following events: (i) any person (within the meaning of  Sections
13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934,  as
amended  (the  "Exchange Act"), including  a  group  (within  the
meaning  of  Rule 13d-5(b)(1) under the Exchange  Act),  together
with  any  affiliates and associates thereof, filing a report  of
Schedule  13D  or 14D-1 pursuant to the Exchange  Act  disclosing
that  such  person has become the beneficial owner of either  (a)
50% or more of the shares of Common Stock then outstanding or (b)
securities representing 50% or more of the combined voting  power
of   the   Company's  Voting  Stock  (as  defined   below)   then
outstanding; (ii) any sale, transfer, lease or conveyance of  all
or  substantially all of the properties and assets of the Company
to  any person (other than a subsidiary of the Company); or (iii)
any  consolidation or merger of the Company in which the  Company
is  not  the sole surviving or continuing corporation or pursuant
to  which the Common Stock is converted into cash, securities  or
other property, other than a consolidation or merger in which the
holders of the Common Stock immediately prior to such transaction
receive,  directly or indirectly, (a) 75% or more of  the  common
stock of the sole surviving or continuing corporation outstanding
immediately after such consolidation or merger and (b) securities
representing  75%  or more of the combined voting  power  of  the
surviving  or  continuing corporation's Voting Stock  outstanding
immediately  after such consolidation or merger.  "Voting  Stock"
means,  with  respect to any person, the capital  stock  of  such
person  having  general voting power under ordinary circumstances
to  elect at least a majority of the board of directors, managers
or trustees of such person (irrespective of whether or not at the
time  capital stock of any other class or classes shall  have  or
might  have  voting  power  by reason of  the  happening  of  any
contingency).

  The  Company will comply with the provisions of Rule 13e-4  and
any other tender offer rules under the Exchange Act that may then
be  applicable  and  will  file a Schedule  13E-4  or  any  other
schedule required thereunder in connection with any offer by  the
Company  to purchase Exchange Debentures at the option of holders
upon  a Change in Control. The Change in Control purchase feature
of the Exchange Debentures may in certain circumstances make more
difficult or discourage a takeover of the Company and, thus,  the
removal  of incumbent management. The Change in Control  purchase
feature is not, however, the result of management's knowledge  of
any  specific efforts to accumulate shares of Common Stock or  to
obtain control of the Company by means of a merger, tender offer,
solicitation of proxies or consents or otherwise, or  part  of  a
plan  to  implement a series of anti-takeover measures.  Instead,
the  Change  in  Control  purchase feature  is  a  commonly  used
provision  designed to facilitate the marketing of  the  Exchange
Debentures,  and the specific terms of such purchase feature  are
the   result  of  negotiations  between  the  Company   and   the
Underwriter.

    The   Company  could,  in  the  future,  enter  into  certain
transactions, including certain recapitalizations of the Company,
that  would  not  constitute  a  Change  in  Control  under   the
Indenture,  but  that  would  increase  the  amount   of   Senior
Indebtedness  (or  any other indebtedness)  outstanding  at  such
time.  There are no restrictions in the Indenture on the creation
of  additional  Senior Indebtedness (or any other  indebtedness),
and,  under  certain circumstances, the incurrence of significant
amounts  of additional indebtedness could have an adverse  effect
on  the  Company's ability to service its indebtedness, including
the  Exchange  Debentures. If such a Change in  Control  were  to
occur,  there  can  be no assurance that the Company  would  have
sufficient funds to pay the Change in Control Purchase Price  for
all  Exchange  Debentures  tendered by  the  holders  thereof.  A
default  by  the Company on its obligation to pay the  Change  in
Control   Purchase   Price  could,  pursuant   to   cross-default
provisions,  result  in  acceleration of  the  payment  of  other
indebtedness of the Company outstanding at that time. Payment  by
the   Company  of  the  Change  in  Control  Purchase  Price   is
subordinated  to  the  prior payment of  Senior  Indebtedness  as
described below under "Subordination of Exchange Debentures."

  The  Indenture does not give the Board authority to  waive  any
of  the  provisions  of the Indenture in the event  of  a  highly
leveraged  transaction. None of the Company's Senior Indebtedness
has a covenant that would afford the holders of such indebtedness
protection in the event of a change in control.

  In  accordance  with the Indenture, no Exchange Debentures  may
be  purchased if there has occurred and is continuing an Event of
Default  described  below under "Events  of  Default  and  Notice
Thereof."
SUBORDINATION OF EXCHANGE DEBENTURES

  The  Exchange  Debentures  will  be  subordinate  in  right  of
payment  to the extent set forth in the Indenture to all existing
and  future Senior Indebtedness (as defined in the Indenture)  of
the Company, whether outstanding on the date of the Indenture  or
thereafter  created,  incurred, assumed or guaranteed.  Upon  any
distribution of assets of the Company in any dissolution, winding
up,  liquidation or reorganization of the Company (whether in  an
insolvency  or  bankruptcy proceeding or otherwise),  payment  in
full  must be made on such Senior Indebtedness before any payment
is  made  on or in respect of the Exchange Debentures.  Upon  the
happening  and during the continuance of a default in payment  of
interest  on  or principal of Senior Indebtedness, or  any  other
default  with respect to such Senior Indebtedness permitting  the
holders  thereof to accelerate the maturity thereof,  no  payment
may  be  made  by  the Company on or in respect of  the  Exchange
Debentures. No such subordination will prevent the occurrence  of
any Event of Default (as defined in the Indenture).

  "Senior  Indebtedness"  means the  principal  of  and  interest
(including, without limitation, any interest accruing  subsequent
to the filing of a petition or other action concerning bankruptcy
or   other  similar  proceeding,  penalties,  reimbursements   or
indemnification amounts, fees, expenses or other amounts relating
to   any   indebtedness)  on  the  following,  whether  presently
outstanding  or hereafter incurred: (a) all indebtedness  of  the
Company (i) for money borrowed (other than that evidenced by  the
Exchange  Debentures),  (ii)  which  is  evidenced  by  a   note,
debenture  or  similar  instrument (including  a  purchase  money
mortgage)  given  in  connection  with  the  acquisition  of  any
property  or  assets  (other  than  inventory  or  other  similar
property  acquired in the ordinary course of business), including
securities,  or  (iii) for the payment of  money  relating  to  a
Capitalized  Lease  Obligation; (b)  any  liabilities  of  others
described  in  the  preceding clause (a) which  the  Company  has
guaranteed  or  which  is  otherwise  its  legal  liability;  (c)
indebtedness  of the Company under interest rate swaps,  caps  or
similar   hedging  agreements  and  foreign  exchange  contracts,
currency   swaps  or  similar  agreements;  and   (d)   renewals,
extensions,    refundings,   restructurings,    amendments    and
modifications   of   any   such   indebtedness   or    guarantee.
Notwithstanding anything to the contrary in the Indenture or  the
Exchange Debentures, "Senior Indebtedness" shall not include  (x)
any  indebtedness  of  the Company to a subsidiary,  or  (y)  any
indebtedness  or guarantee of the Company which by its  terms  or
the  terms  of the instrument creating or evidencing  it  is  not
superior in right of payment to the Exchange Debentures.

  At   March   31,   1997,  there  was  no  Senior   Indebtedness
outstanding.  Also, at that date, subsidiaries of the Company had
indebtedness  of approximately $2,868,000, to which the  Exchange
Debentures  are effectively subordinate. The Indenture  will  not
limit  the  amount  of additional indebtedness, including  Senior
Indebtedness,  which  the Company can create,  incur,  assume  or
guarantee,   nor  will  the  Indenture  limit   the   amount   of
indebtedness which any subsidiary can incur. As a result of these
subordination provisions, in the event of insolvency, holders  of
the Exchange Debentures may recover less ratably than holders  of
Senior Indebtedness and general creditors of the Company.
  
EVENTS OF DEFAULT AND NOTICE THEREOF

  The term "Event of Default" when used in the Indenture will
mean any one of the following: (i)  failure of the Company to pay
interest for 30 days or principal when due; (ii) failure of the
Company to  comply with any other covenant in the Indenture for
60 days after notice; (iii) default by the Company  with respect
to indebtedness aggregating more than $10,000,000, and the
acceleration of such  indebtedness under the terms of the
instruments evidencing such indebtedness or a default in any
payment when due at final maturity of any such indebtedness; and
(iv) certain events of bankruptcy or  reorganization of the
Company or any subsidiary.
The  Indenture will provide that the Trustee shall,  within  90
days after the occurrence of any default  (the term "default"  to
include the events specified above without grace or notice) known
to it, give to the  holders of Exchange Debentures notice of such
default; provided that, except in the case of a default  in   the
payment  of  principal  of or interest on  any  of  the  Exchange
Debentures, the Trustee shall be protected  in the withholding of
such  notice  if it in good faith determines that the withholding
of  such  notice is in the  interest of the holders  of  Exchange
Debentures. The Indenture will require the Company to certify  to
the   Trustee annually as to whether any default occurred  during
such year.

  In  case  an  Event of Default (other than an Event of  Default
resulting  from bankruptcy, insolvency or  reorganization)  shall
occur  and be continuing, the Trustee or the holders of at  least
25%  in  aggregate   principal amount of the Exchange  Debentures
then  outstanding, by notice in writing to the Company  (and   to
the  Trustee if given by the holders of the Exchange Debentures),
may,  and  the Trustee shall, upon the  request of such  holders,
declare all unpaid principal and accrued interest on the Exchange
Debentures   then outstanding to be due and payable  immediately.
In  case  an Event of Default resulting from certain   events  of
bankruptcy, insolvency or reorganization shall occur, all  unpaid
principal  of  and  accrued interest  on the Exchange  Debentures
then outstanding shall be due and payable immediately without any
declaration  or  other  act on the part of  the  Trustee  or  the
holders  of  Exchange  Debentures.  Such   acceleration  may   be
annulled  and  past defaults may be waived by the  holders  of  a
majority  in  principal  amount of the Exchange  Debentures  then
outstanding, upon the conditions provided in the Indenture.

  The  Indenture  will  provide that no  holder  of  an  Exchange
Debenture  may pursue any remedy under  the Indenture unless  the
Trustee  shall  have failed to act after notice of  an  Event  of
Default  and  request  by holders of at least  25%  in  principal
amount  of  the Exchange Debentures and the offer to the  Trustee
of  indemnity  satisfactory to it; provided, however,  that  such
provision  does  not affect the right to sue for  enforcement  of
any overdue payment on the Exchange Debentures.

  The   holders  of  a  majority  in  principal  amount  of   all
outstanding  Exchange Debentures will have the  right  to  direct
the  time,  method  and place of conducting  any  proceeding  for
exercising  any  remedy  or   power  available  to  the  Trustee,
provided that such direction does not conflict with any  rule  of
law or with  the Indenture.

MODIFICATION AND WAIVER

   Modification and amendment of the Indenture may be made by the
Company and the Trustee with  the consent of the holders  of  not
less  than  a  majority in principal amount  of  the  outstanding
Exchange   Debentures,  provided that  no  such  modification  or
amendment  may,  without  the consent  of  the  holder  of   each
Exchange  Debenture affected thereby, (i) reduce  the  amount  of
Exchange  Debentures whose  holders must consent to an amendment,
supplement or waiver; (ii) reduce the rate of or change the  time
for  payment of interest on any Exchange Debenture; (iii)  reduce
the  principal of or change the fixed  maturity of  any  Exchange
Debenture  or  alter  the  redemption  provisions  with   respect
thereto;  (iv) modify  the conversion provisions with respect  to
any  Exchange  Debenture  in  a  manner  adverse  to  the  holder
thereof;  (v) waive a default in the payment of the principal  of
(and  premium,  if  any) or interest on any  Exchange  Debenture;
(vi)  make  any  changes  to  the  provisions  of  the  Indenture
governing  waiver  of  defaults and Events  of  Default  and  the
rights  of  holders to receive payment of the principal  of  (and
premium,  if  any) and interest on the Exchange Debenture;  (vii)
modify the Subordination provisions of  the Indenture in a manner
adverse to the holders of the Exchange Debenture; or (viii)  make
any   Exchange Debenture payable in money other than that  stated
in  the  Exchange Debentures. Holders of not less than a majority
in  principal amount of the outstanding Exchange  Debentures  may
waive  certain past defaults. See "Events of Default  and  Notice
Thereof." An  amendment to the Indenture may not adversely affect
the rights under the subordination provisions of the  holders  of
any  issue  of  Senior Indebtedness without the consent  of  such
holders.

SATISFACTION AND DISCHARGE

  The  Indenture will be discharged and canceled upon payment  of
all  the Exchange Debentures. The  Company may terminate  all  of
its obligations under the Indenture, other than its obligation to
pay the  principal of and interest on the Exchange Debentures and
certain  other obligations (including its obligation  to  deliver
shares  of  Common Stock upon conversion of Exchange Debentures),
at  any  time, by  depositing with the Trustee or a paying  agent
other  than  the  Company, money or noncallable U.S.   Government
Obligations (as defined in the Indenture) sufficient to  pay  all
remaining indebtedness on the  Exchange Debentures.
MERGER AND CONSOLIDATION

  The   Company   may  consolidate  or  merge  with   any   other
corporation and the Company may transfer  its property and assets
substantially  as an entirety to any persons; provided  that  (i)
the  Company is the  resulting or surviving corporation,  or  the
successor  corporation is a domestic corporation and it  assumes,
by  supplemental  indenture, payment  of  the  principal  of  and
interest   on  the  Exchange  Debentures  and   performance   and
observance  of  every  covenant  of  the  Indenture,   and   (ii)
immediately before and  immediately after giving effect  to  such
transaction,  no default or Event of Default shall have  occurred
and   be  continuing. Thereafter, all obligations of the  Company
under the Indenture and the Exchange  Debentures will terminate.

CONCERNING THE TRUSTEE

  Fidelity   Bank,  National  Association,  a  national   banking
association,  will  be  the  Trustee under  the   Indenture.  The
Indenture will contain certain limitations on the rights  of  the
Trustee,  should it become a  creditor of the Company, to  obtain
payment  of  claims  in certain cases, or to realize  on  certain
property   received in respect of any such claim as  security  or
otherwise.  The  Trustee will be permitted to  engage  in   other
transactions;  provided, however, if it acquires any  conflicting
interest (as defined) and there exists a  default with respect to
the  Exchange  Debentures,  it must eliminate  such  conflict  or
resign.

     In case an Event of Default shall occur (and shall not be
cured) and holders have notified the  Trustee, the Trustee will
be required to exercise its powers with the degree of care and
skill of a prudent  person in the conduct of his own affairs.
Subject to such provisions, the Trustee will be under no
obligation to exercise any of its rights or powers under the
Indenture at the request of any of the holders  of Exchange
Debentures, unless they shall have offered to the Trustee
security and indemnity  satisfactory to it.

                           *    *    *
     This document constitutes part of a prospectus covering
         securities that have been registered under the
                     Securities Act of 1933.
PART  I - INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

          The documents containing the information specified in Part I
of this Registration Statement will be given or sent to all employees
who participate in the Westmoreland Coal Company and Affiliated
Companies' Employees' Savings/Retirement Plan (the "Plan") as
specified by Rule 428.

PART II - INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3.   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.

          The following documents filed with the Securities and
Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") by Westmoreland Coal Company
(the "Company") (File No. 0-752) are incorporated herein by reference:

                    (i)  the Company's Annual Report on Form 10-K for
                 the fiscal year ended December 31, 1996;

                    (ii) the description of the Company's Common Stock
                 contained in its Registration Statement on Form 8-A,
                 filed May 22, 1992; and

                    (vi) the description of the Company's Depository
                 Shares contained in its Registration Statement on
                 Form 8-A, filed June 23, 1992.

          Each document filed by the Company after the date hereof
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
prior to the filing of a post-effective amendment which indicates that
all securities offered hereby have been sold or which deregisters all
securities remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and shall be part hereof from
the date of filing of such document.

ITEM 4.   DESCRIPTION OF SECURITIES.

          Not applicable.

ITEM 5.   INTERESTS OF NAMED EXPERTS AND COUNSEL.

          Paul W. Durham, Esquire, the named counsel who prepared the
opinion attached as Exhibit 5.1, is connected with the registrant by
virtue of his position as Assistant General Counsel and Assistant
Secretary of the Company.
ITEM 6.   INDEMNIFICATION OF DIRECTORS AND OFFICERS.

          Section 145 of Delaware's General Corporation Law authorizes
a corporation to indemnify any present or former director or officer
against certain lawsuits brought by reason of the fact that the person
is or was a director or officer of the corporation.  This language is
sufficiently broad that in certain circumstances, it could permit
indemnification for liabilities and expenses incurred arising under
the Securities Act of 1933, as amended.  Further, the statute creates
a right of indemnification if the director or officer is successful on
the merits or otherwise in defense of any action for which the
corporation may indemnify the director or officer.

          Article V of the Company's By-Laws provide that the Company
shall indemnify its directors and officers for any expenses including
attorney's fees, judgments and other amounts incurred in connection
with a suit, action or proceeding brought by reason of the fact that
he or she is or was a director or officer.  The terms of the
indemnification provisions in the Company's By-Laws are substantially
similar to the provisions of Section 145 of Delaware's General
Corporation Law.  The Company maintains and pays all premiums on a
liability policy for its liability and that of its directors and
officers and those of its subsidiaries.

ITEM 7.  EXEMPTION FROM REGISTRATION CLAIMED.

          Not applicable.

ITEM 8.  EXHIBITS.

          4.1    Certificate of Designation of Series A Convertible
          Exchangeable Preferred Stock of the Company defining the
          rights of holders of such stock, filed July 8, 1992 as an
          amendment to the Company's Certificate of Incorporation, and
          filed as Exhibit 3(a) to the Company's Form 10-K for 1992,
          which Exhibit is incorporated herein by reference;

          4.2    Form of Deposit Agreement among the Company, First
          Chicago Trust Company of New York, as Depository, and the
          holders from time to time of the Depository Receipts, filed
          as Exhibit 4.3 to Form S-2, Registration No. 33-47872 filed
          May 13, 1992, and Amendments 1 through 4 thereto, which
          Exhibit is incorporated herein by reference;

          4.3    Specimen certificate representing the common stock of
          the Company, filed as Exhibit 4(c) to the Company's
          Registration Statement on Form S-2, Registration No.
          33-1950, filed December 4, 1985, which Exhibit is
          incorporated herein by reference;

          4.4    Specimen certificate representing the Preferred
          Stock, filed as Exhibit 4.6 to the Company's Registration
          Statement on Form S-2, Registration No. 33-47872, filed May
          13, 1992, and Amendments 1 through 4 thereto, which Exhibit
          is incorporated herein by reference; and

          4.5    Form of Depository Receipt, filed as Exhibit 4.7 to
          the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

          4.6    Form of Exchange Indenture, filed as Exhibit 4.2 to
          the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments, 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

          5.1    Opinion of Paul W. Durham, Esquire

          23.1   Consent of KPMG Peat Marwick LLP

          24.1   Power of Attorney (included on signature page)

          99.1   Westmoreland Coal Company and Affiliated Companies
          Employees' Savings/Retirement Plan

ITEM 9.  UNDERTAKINGS.

          The undersigned registrant hereby undertakes:

     (1)  To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:

     (i)  To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;

     (ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) that, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement.  Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;

     (iii)  To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;

          Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the registration statement is on Form S-3 or Form S-8,
and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
the registration statement.
(2)  That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

     (3)  To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.

          The registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Securities Exchange Act of 1934) that
is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

          Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable.  In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Colorado Springs, Colorado
on July 30, 1997.

                                   Westmoreland Coal Company

                                   By   /s/ Robert J. Jaeger
                                        --------------------------
                                        Robert J. Jaeger
                                        Senior Vice President of
                                        Finance, Treasurer and
                                        Controller

     Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.

     Each person whose signature appears below in so signing also
makes, constitutes and appoints Theodore E. Worcester and Paul W.
Durham and each of them, his true and lawful attorney-in-fact, with
full power of substitution, for him in any and all capacities, to
execute and cause to be filed with the Securities and Exchange
Commission any and all amendments and post-effective amendments to
this Registration Statement, with exhibits thereto and other documents
in connection therewith, and hereby ratifies and confirms all that
said attorney-in-fact or his substitute or substitutes may do or cause
to be done by virtue hereof.

Signature                      Title                              Date

                              Chairman of the Board,
/s/ Christopher K. Seglem     President and Cheif              July 30, 1997
---------------------------   Executive Officer
Christopher K. Seglem         (principal executive officer)

                              Senior Vice President
/s/ Robert J. Jaeger          of Finance, Treasurer            July 30, 1997 
----------------------        and Controller
Robert J. Jaeger             (principal financial and
                              accounting officer)

Directors:

/s/ Pemberton Hutchinson      Director                         July 28, 1997
-------------------------
Pemberton Hutchinson

/s/ Robert E. Killen          Director                         July 28, 1997
-------------------------
Robert E. Killen

/s/ William R. Klaus          Director                         July 28, 1997
-------------------------
William R. Klaus

/s/ Thomas W. Ostrander       Director                         July 28, 1997
-------------------------
Thomas W. Ostrander

/s/ James W. Sight            Director                         July 28, 1997
-------------------------
James W. Sight

/s/ Edwin E. Tuttle           Director                         July 28, 1997
-------------------------
Edwin E. Tuttle

     Pursuant to the requirements of the Securities Act of 1933,
the trustees (or other persons who administer the employee
benefit plan) have duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in Colorado Springs, Colorado on July 30, 1997.

                         Westmoreland Coal
                         Company and Affiliated Companies
                         Employees' Savings/Retirement Plan

                         
                         By:  Westmoreland Coal Company
                              Savings/Retirement Plan
                              Administrative Committee

 
                              By:  /s/ Cheryl M. Sprague
                                   ----------------------
                                   Cheryl M. Sprague
EXHIBIT INDEX

  Exhibit

   Number              Description                        Page

     4.1  Certificate of Designation of Series A Convertible
          Exchangeable Preferred Stock of the Company defining
          the rights of holders of such stock, filed July 8, 1992
          as an amendment to the Company's Certificate of
          Incorporation, and filed as Exhibit 3(a) to the
          Company's Form 10-K for 1992, which Exhibit is
          incorporated herein by reference;

     4.2  Form of Deposit Agreement among the Company, First
          Chicago Trust Company of New York, as Depository, and
          the holders from time to time of the Depository
          Receipts, filed as Exhibit 4.3 to Form S-2,
          Registration No. 33-47872 filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference;

     4.3  Specimen certificate representing the common stock
          of the Company, filed as Exhibit 4(c) to the Company's
          Registration Statement on Form S-2, Registration No.
          33-1950, filed December 4, 1985, which Exhibit is
          incorporated herein by reference;

     4.4  Specimen certificate representing the Preferred
          Stock, filed as Exhibit 4.6 to the Company's
          Registration Statement on Form S-2, Registration No.
          33-47872, filed May 13, 1992, and Amendments 1 through
          4 thereto, which Exhibit is incorporated herein by
          reference; and

     4.5  Form of Depository Receipt, filed as Exhibit 4.7
          to the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

     4.6  Form of Exchange Indenture, filed as Exhibit 4.2
          to the Company's Registration Statement on Form S-2,
          Registration No. 33-47872, filed May 13, 1992, and
          Amendments, 1 through 4 thereto, which Exhibit is
          incorporated herein by reference.

     5.1  Opinion of Paul W. Durham, Esquire

     23.1 Consent of KPMG Peat Marwick LLP

     24.1 Power of Attorney (included on signature page)

     99.1 Westmoreland Coal Company and Affiliated Companies
          Employees' Savings/Retirement Plan
Exhibit 5.1
                                   July 30, 1997

Board of Directors
Westmoreland Coal Company
2 North Cascade Avenue
Colorado Springs, CO 80903

Gentlemen:

          This opinion is provided to Westmoreland Coal Company,
a Delaware corporation (the "Company"), in connection with its
registration statement on Form S-8 (the "Registration Statement")
filed with the Securities and Exchange Commission relating to the
proposed purchase and sale pursuant to the terms of the
Westmoreland Coal Company And Affiliated Companies Employees'
Savings/Retirement Plan (the "Plan") of up to 325,000 shares of
the Company's common stock, par value $2.50 per share and up to
7,000 shares of the Company's Depositary Shares.  This opinion
letter is furnished to you at your request to enable you to
fulfill the requirements of Item 601(b)(5) of Regulation S-K,
17 C.F.R. Section 229.601(b)(5), in connection with the Registration
Statement.

          For purposes of this opinion letter, I have examined
copies of documents deemed necessary for this opinion, and in my
examination of such documents, have assumed the genuineness of
all signatures, the legal capacity of natural persons, the
authenticity, accuracy and completeness of all such documents,
and the conformity with the original documents of all documents
submitted to me as certified, telecopied, photostatic, or
reproduced copies.  This opinion letter is given, and all
statements herein are made, in the context of the foregoing.

          This opinion letter is based as to matters of law
solely on the General Corporation Law of the State of Delaware.
I express no opinion herein as to any other laws, statutes,
regulations, or ordinances.

          Based upon, subject to and limited by the foregoing, I
am of the opinion that the Shares are validly issued, fully paid
and nonassessable under the General Corporation Law of the State
of Delaware.  A copy of the Internal Revenue Service
determination letter that the Plan is qualified under Section 401
of the Internal Revenue Code is attached hereto.
I assume no obligation to advise you of any changes in
the foregoing subsequent to the delivery of this opinion letter.
This opinion letter has been prepared solely for your use in
connection with the filing of the Registration Statement on the
date of this opinion letter and should not be quoted in whole or
in part or otherwise be referred to, nor filed with or furnished
to any governmental agency or other person or entity, without the
prior written consent of this firm.

          I hereby consent to the filing of this opinion letter
as Exhibit 5.1 to the Registration Statement.  In giving this
consent, I do not thereby admit that I am an "expert" within the
meaning of the Securities Act of 1933, as amended.

          
          
                              Very truly yours,
                              /s/ Paul W. Durham
                              --------------------------
                              Paul W. Durham
                              Assistant General Counsel
                              Westmoreland Coal Company
INTERNAL REVENUE SERVICE           DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
31 HOPKINS PLAZA
BALTIMORE, MD 21201-0000

Date: Feb 02 1996

WESTMORELAND RESOURCES, INC.
C/O ANDREW J. RUDOLPH, ESQUIRE
BALLARD SPAHR ANDREWS & INGERSOLL
1735 MARKET STREET, 51ST FLOOR
PHILADELPHIA, PA 19103-7599

Employer Identification Number:    81-0364990
File Folder Number: 521054602
Person to Contact:  AUDREY PETIT
Contact Telephone Number:     (215) 597-8958
Plan Name:     WESTMORELAND COAL COMPANY AND AFFILIATED COMPANIES
EMPLOYEES SAV
Plan Number:   001

Dear Applicant:

     We have made a favorable determination on your plan,
identified above, based on the information supplied.  Please keep
this letter in your permanent records.

     Continued qualification of the plan under its present form
will depend on its effect in operation.  (See section 1.401-
1(b)(3) of the Income Tax Regulations.)  We will review the
status of the plan in operation periodically.

     The enclosed document explains the significance of this
favorable determination letter, points out some features that may
affect the qualified status of your employee retirement plan, and
provides information on the reporting requirements for your plan.
It also describes some events that automatically nullify it.  It
is very important that you read the publication.

     This letter relates only to the status of your plan under
the Internal Revenue Code.  It is not a determination regarding
the effect of other federal or local statues.

     This determination is subject to your adoption of the
proposed amendments submitted in your letter dated 8/31/95 and
11/2/95.  The proposed amendments should be adopted on or before
the date prescribed by the regulations under code section 401(b).

     This plan has been mandatorily disaggregated, permissively
aggregated, or restructured to satisfy the nondiscrimination
requirements.

     This letter is issued under Rev. Proc. 93-39 and considers
the amendments required by the Tax Reform Act of 19867 except as
otherwise specified in this letter.

     This plan satisfies the nondiscriminatory current
availability requirements of section 1.401(a)(4)-(4)(b) of the
regulations with respect to those benefits, rights, and features
that are currently available to all employees in the plan's
coverage group.  For this purpose, the plan's coverage group
consists of those employees treated as currently benefiting for
purposes of demonstrating that the plan satisfies the minimum
coverage requirements of section 410(b) of the Code.
This leter may not be relied upon with respect to whether
the plan satisfies the qualification requirements as amended by
the Uruguay Round Agreements Act, Pub. L. 103-465.

     We have sent a copy of this letter to your representative as
indicated in the power of attorney.

     If you have questions concerning this matter, please contact
the person whose name and telephone number are shown above.

                              Sincerely yours,

                              /s/ Paul M. Hunsington
                              District Director

Enclosure(s)
Publication 794
Exhibit 23.1

                 CONSENT OF INDEPENDENT AUDITORS
                                

The Board of Directors
Westmoreland Coal Company:

We consent to the incorporation by reference in the registration
statement on Form S-8 of Westmoreland Coal Company of our report
dated March 17, 1997, relating to the consolidated balance sheets
of Westmoreland Coal Company and subsidiaries as of December 31,
1996 and 1995, and the related consolidated statements of
opertaions, shareholders' equity (deficit), and cash flows for
each of the years in the three-year period ended December 31,
1996, which report appears in the December 31, 1996 annual report
on Form 10-K of Westmoreland Coal Company.

Our report dated March 17, 1997 contains an explanatory paragraph
that states that the Company's bankruptcy filing under Chapter 11
of the United States Bankruptcy Code raises substantial doubt
about its ability to continue as a going concern.  The
consolidated financial statements do not include any adjustments
that might result from the outcome of that uncertainty.

                              KPMG Peat Marwick LLP

Denver, Colorado
July 25, 1997
Exhibit 99.1

                   WESTMORELAND COAL COMPANY

                              AND

    AFFILIATED COMPANIES EMPLOYEES' SAVINGS/RETIREMENT PLAN

                      AMENDED AND RESTATED

                  EFFECTIVE SEPTEMBER 1, 1987

                       TABLE OF CONTENTS
                                                             PAGE

     ARTICLE I

                          DEFINITIONS

"Account"                                                       2
     "Matching Contribution Account"                            2
     "Pre-1994 Matching Contribution Subaccount"                2
     "Post-1993 Matching Contribution Subaccount"               2
     "Rollover Account"                                         3
     "Salary Reduction Account"                                 3
     "Pre-1990 Salary Reduction Subaccount"                     3
     "Post-1989 Salary Reduction Subaccount"                    3
     "Voluntary Contribution Account"                           4
"Active Participant"                                            4
"Actual Deferral Percentage"                                    4
"Affiliated Company"                                            4
"Age"                                                           5
"Age 55 Shares"                                                 5
"Alternate Payee"                                               6
"Average Actual Deferral Percentage"                            6
"Average Contribution Percentage"                               6
"Benefit Commencement Date"                                     6
"Board of Directors"                                            6
"Code"                                                          6
"Committee"                                                     7
"Company"                                                       7
"Company Stock"                                                 7
"Compensation"                                                  7
"Covered Employee"                                             10
"Effective Date"                                               11
"Eligible Employee"                                            11
"Employee"                                                     11
"Employment Commencement Date"                                 11
"ERISA"                                                        11
"Fixed Income Fund"                                            11
"Fund"                                                         12
"Highly Compensated Eligible Employee"                         12
"Highly Compensated Employee"                                  12
"Hour of Service"                                              14
"Investment Medium"                                            16
"Limitation Year"                                              16
"Matching Contributions"                                       16
"Normal Retirement Age"                                        16
"Normal Retirement Date"                                       16
"Participant"                                                  16
"Participating Company"                                        17
"Payroll Period"                                               17
"Plan"                                                         17
"Plan Year"                                                    17
"Post-1989 Rollover Contributions"                             17
"Post-1993 Matching Contributions"                             17
"Post-1989 Salary Reduction Contributions"                     17
"Pre-1994 Matching Contributions"                              18
"Pre-1990 Rollover Contributions"                              18
"Pre-1990 Salary Reduction Contributions"                      18
"Qualified Domestic Relations Order"                           18
"Quarterly Status Date"                                        18
"Required Beginning Date"                                      18
"Rollover Contributions"                                       19
"Salary Reduction Contributions"                               19
"Separation from Service"                                      20
"Spouse"                                                       20
"Total Disability"                                             20
"Trust Agreement"                                              20
"Trustee"                                                      21
"Valuation Date"                                               21
"Voluntary Contributions"                                      21

     ARTICLE II

           TRANSITION AND ELIGIBILITY TO PARTICIPATE

2.1    Rights Affected and Preservation of Accrued Benefit     22
2.2    Eligibility to Participate - Salary Reduction
       Contributions                                           22
2.3    Election to Make Salary Reduction Contributions         23
2.4    Participation in Matching Contributions                 23
2.5    Data                                                    23

     ARTICLE III

                   CONTRIBUTIONS TO THE PLAN

3.1    Salary Reduction Contributions                          25
3.2    Change of Percentage Rate                               26
3.3    Discontinuance of Salary Reduction Contributions        27
3.4    Matching Contribution                                   28
3.5    Timing and Deductibility of Contributions               30
3.6    Fund                                                    31
3.7    Limitation on Salary Reduction Contributions and
       Matching Contributions                                  31
3.8    Prevention of Violation of Limitation on Salary
       Reduction Contributions and Matching Contributions      35
3.9    Maximum Allocation                                      40

                           ARTICLE IV

                     PARTICIPANTS' ACCOUNTS

4.1    Accounts                                                46
4.2    Valuation                                               46
4.3    Apportionment of Gain or Loss                           46
4.4    Accounting for Allocations                              47
4.5    Statement of Account.                                   47

     ARTICLE V

                          DISTRIBUTION

5.1    General                                                 48
5.2    Separation from Service                                 48
5.3    Death                                                   48
5.4    Total Disability                                        48
5.5    Valuation for Distribution                              49
5.6    Timing of Distribution                                  50
5.7    Mode of Distribution                                    52
5.8    Beneficiary Designation                                 54
5.9    Transfer of Account to Other Plan                       56
5.10   Sale of Company Stock Upon Distribution.                59

     ARTICLE VI

                            VESTING

6.1    Nonforfeitable Amounts                                  60

     ARTICLE VII

              PURCHASE AND VOTING OF COMPANY STOCK

7.1    Purchase of Company Stock                               61
7.2    Participant Voting Direction                            61
7.3    Voting Procedures                                       62
7.4    Absence of Participant Voting Direction                 62

     ARTICLE VIII

                           WITHDRAWALS

8.1    Withdrawals Not Subject to Section 401(k)
       Restrictions.                                           63
8.2    Withdrawals Subject to Section 401(k) Restrictions      64
8.3    Withdrawals On and After Attainment of Age 59-1/2       67
8.4    Amount and Payment of Withdrawals                       67
8.5    Pledged Amounts                                         67
8.6    Investment Medium to be Charged with Withdrawal         68

     ARTICLE IX

                     LOANS TO PARTICIPANTS

9.1    Loan Application                                        69
9.2    Loan Approval                                           69
9.3    Amount of Loan                                          69
9.4    Terms of Loan                                           70
9.5    Enforcement                                             73
9.6    Investment Medium to be charged with Loan               74
9.7    Additional Rules                                        75

     ARTICLE X

                         ADMINISTRATION

10.1   Committee                                               76
10.2   Duties and Powers of Committee                          76
10.3   Functioning of Committee                                78
10.4   Disputes                                                78
10.5   Indemnification                                         79

     ARTICLE XI

                            THE FUND

11.1   Designation of Trustee                                  81
11.2   Exclusive Benefit                                       81
11.3   No Interest in Fund                                     81
11.4   Trustee                                                 81

     ARTICLE XII

                          INVESTMENTS

12.1   Investment of Pre-1994 Matching Contributions,
       Voluntary Contributions, Pre-1990 Salary Reduction
       Contributions and Pre-1990 Rollover Contributions       83
12.2   Investment of Post-1989 Salary Reduction Contributions,
       Post-1989 Rollover Contributions and Post-1993 Matching
       Contributions                                           85
12.3   Investment Media.                                       87
12.4   Additional Rules                                        87

     ARTICLE XIII

              AMENDMENT OR TERMINATION OF THE PLAN

13.1   Power of Amendment and Termination                      89
13.2   Merger                                                  90

     ARTICLE XIV

                      TOP-HEAVY PROVISIONS

14.1   General                                                 91
14.2   Definitions                                             91
14.3   Minimum Contribution for Non-Key Employees              97
14.4   Social Security                                         98
14.5   Adjustment to Maximum Benefit Limitation                98

     ARTICLE XV

                     ROLLOVER CONTRIBUTIONS

15.1   Rollover Contributions.                                101
15.2   Vesting and Distribution of Rollover Account           102

     ARTICLE XVI

                       GENERAL PROVISIONS

16.1   No Employment Rights                                   103
16.2   Governing Law                                          103
16.3   Severability of Provisions                             103
16.4   No Interest in Fund                                    103
16.5   Spendthrift Clause                                     104
16.6   Incapacity                                             104
16.7   Withholding                                            104
16.8   Missing Persons                                        105

          WHEREAS, Westmoreland Coal Company (the "Company")

adopted the Westmoreland Coal Company and Affiliated Companies

Employees' Stock Purchase Plan, effective October 1, 1957, for

certain of its Employees and the Employees of any Participating

Companies; and

          WHEREAS, the Company amended and restated the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, effective June 1, 1984; and

          WHEREAS, the Company desires to amend and restate the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan to comply with the requirements of the

Employee Retirement Income Security Act of 1974 and with the

Internal Revenue Code of 1986, as amended; and

          WHEREAS, the Company desires to rename the Westmoreland

Coal Company and Affiliated Companies Employees' Stock Purchase

Plan, effective March 1, 1990;

          NOW, THEREFORE, effective September 1, 1987, the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan is continued, amended and restated as

hereinafter set forth and, effective March 1, 1990, renamed the

Westmoreland Coal Company and Affiliated Companies Employees'

Savings/Retirement Plan:

                           ARTICLE I

                          DEFINITIONS

          Except where otherwise clearly indicated by context,

the masculine shall include the feminine and the singular shall

include the plural, and vice-versa.  Any term used herein without

an initial capital letter that is used in a provision of the Code

with which this Plan must comply to meet the requirements of

section 401(a) of the Code shall be interpreted as having the

meaning used in such provision of the Code, if necessary for the

Plan to comply with such provision.

          "Account" means the entries maintained in the records

of the Trustee which represent the Participant's interest in the

Fund.  The term "Account" shall refer, as the context indicates,

to any or all of the following:

               "Matching Contribution Account" -- the Account

which consists of the following two Subaccounts:

               (a)  "Pre-1994 Matching Contribution Subaccount"

--- the subaccount to which are credited Pre-1994 Matching

Contributions, and all other contributions made by a

Participating Company prior to June 1, 1984, allocated to a

Participant, adjustments for withdrawals and distributions, and

the earnings, losses and expenses attributable thereto; and

               (b)  "Post-1993 Matching Contribution Subaccount"

--- the subaccount to which are credited Post-1993 Matching

Contributions, allocated to a Participant, adjustments for

withdrawals and distributions, and the earnings, losses and

expenses attributable thereto.

               "Rollover Account" -- the Account which consists

of the following two Subaccounts:

               (a)  "Pre-1990 Rollover Subaccount" --- the

subaccount to which are credited a Participant's Pre-1990

Rollover Contributions that are not subject to the joint and

survivor annuity requirements of sections 401(a)(11) and 417 of

the Code, adjustments for withdrawals and distributions, and the

earnings, losses and expenses attributable thereto; and

               (b)  "Post-1989 Rollover Subaccount" --- the

subaccount to which are credited a Participant's Post-1989

Rollover Contributions that are not subject to the joint and

survivor annuity requirements of sections 401(a)(11) and 417 of

the Code, adjustments for withdrawals and distributions, and the

earnings, losses and expenses attributable thereto.

               "Salary Reduction Account" -- the Account which

consists of the following two Subaccounts:

               (a)  "Pre-1990 Salary Reduction Subaccount" ---

the subaccount to which are credited a Participant's Pre-1990

Salary Reduction Contributions, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto; and

               (b)  "Post-1989 Salary Reduction Subaccount" ---

the subaccount to which are credited a Participant's Post-1989

Salary Reduction Contributions, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto.

               "Voluntary Contribution Account" -- the Account to

which are credited a Participant's Voluntary Contributions made

prior to June 1, 1984, adjustments for withdrawals and

distributions, and the earnings, losses and expenses attributable

thereto.

          "Active Participant" means an individual who has become

an Active Participant as provided in Article II and has remained

a Covered Employee at all times thereafter.

          "Actual Deferral Percentage" means, for any Eligible

Employee for a given Plan Year, the ratio of:

               (a)  the sum of:

                    (1)  such Eligible Employee's Salary

Reduction Contributions for the Plan Year, plus

                    (2)  in the case of any Highly Compensated

Eligible Employee, his elective deferrals for the year under any

other qualified retirement plan, other than an employee stock

ownership plan as defined in section 4975(e)(7) of the Code or a

tax credit employee stock ownership plan as defined in section

409(a) of the Code, maintained by the Participating Company or

any Affiliated Company; to

               (b)  the Eligible Employee's Compensation for the

Plan Year or the calendar year ending within the Plan Year.

          "Affiliated Company" means, with respect to any

Participating Company, (a) any corporation that is a member of a

controlled group of corporations, as determined under section

414(b) of the Code, which includes such Participating Company;

(b) any member of an affiliated service group, as determined

under section 414(m) of the Code, of which such Participating

Company is a member; (c) any trade or business (whether or not

incorporated) that is under common control with such

Participating Company, as determined under section 414(c) of the

Code; and (d) any other organization or entity which is required

to be aggregated with the Participating Company under section

414(o) of the Code and regulations issued thereunder.  "50%

Affiliated Company" means an Affiliated Company, but determined

with "more than 50%" substituted for the phrase "at least 80%" in

section 1563(a) of the Code, when applying sections 414(b) and

(c) of the Code.

          "Age" means, for any individual, his age on his last

birthday, except that an individual attains Age 59-1/2 or Age

70-1/2 on the corresponding date in the sixth calendar month

following the month in which his 59th or 70th (respectively)

birthday falls (or the last day of such sixth month if there is

no such corresponding date therein).

          "Age 55 Shares" means, with respect to any Participant,

the Company Stock allocated to his Pre-1994 Matching Contribution

Subaccount, Voluntary Contribution Account, and Pre-1990 Salary

Reduction Subaccount as of the later of (a) the Quarterly Status

Date coincident with or next following the date the Participant

attains Age 55 or (b) June 30, 1976, plus any Company Stock

allocated to such Account and Subaccounts after such date.

          "Alternate Payee" shall mean any Spouse, former Spouse,

child or other dependent of a Participant who is recognized by a

domestic relations order (within the meaning of

section 414(p)(1)(B) of the Code) as having a right to receive

all, or a portion of, the benefits payable under the Plan with

respect to such Participant.

          "Average Actual Deferral Percentage" means, for a

specified group of Eligible Employees for a Plan Year, the

average of the Actual Deferral Percentages for such Eligible

Employees for the Plan Year.

          "Average Contribution Percentage" means, for a

specified group of Eligible Employees for a Plan Year, the

average of the Contribution Percentages for such Eligible

Employees for the Plan Year.

          "Benefit Commencement Date" means, for any Participant

or beneficiary, the date as of which the first benefit payment,

including a single sum, from the Participant's Account is due,

other than pursuant to a withdrawal under Article VIII.

          "Board of Directors" means the board of directors (or

other governing body) of the Company.

          "Code" means the Internal Revenue Code of 1986, as

amended, and any regulations issued thereunder.

          "Committee" means the individuals appointed by the

Board of Directors (if any) or by the Company to supervise the

administration of the Plan, as provided in Article X.

          "Company" means Westmoreland Coal Company, and its

successors.

          "Company Stock" means:

               (a)  prior to March 1, 1993, shares of common

stock of the Company; and

               (b)  after February 28, 1993, shares of common

stock or preferred stock (the latter represented by and held in

the form of depository shares) of the Company.

          "Compensation" means, for any Eligible Employee, for

any applicable period:

               (a)  For purposes of Sections 3.1 and 3.4, subject

to the limitations set forth in Subsection (e) of this

definition, his base monthly rate of pay from a Participating

Company (including Salary Reduction Contributions and salary

deferrals under a plan described in section 125 of the Code).

Compensation shall not include bonuses, commissions, other

incentive or special payments, overtime pay, all amounts

identified by a Participating Company as expense allowances or

reimbursements, and all Matching Contributions, or any

contributions made by a Participating Company under any other

employee pension benefit or welfare benefit plan to which the

Participating Company contributes on behalf of the Employee. 

               (b)  for the purposes of Article XIV and Section 3.9,

subject to the limitations set forth in Subsection (e) of this

definition, the Employee's "compensation" as such word is

defined in Treas. Reg. Section 1.415-2(d)(10).

               (c)  for the purposes of the definitions of

"Actual Deferral Percentage" and "Contribution Percentage" in

this Article (except as otherwise provided in such definitions,

and subject to the limitations set forth in Subsection (e) of

this definition, the Employee's "compensation" as such word is

defined in Treas. Reg. Section 1.415-2(d)(10) provided that, in the sole

discretion of the Committee, Compensation may include:

                    (1)  Salary Reduction Contributions and other

amounts excluded from gross income under section 125, 402(a)(8),

402(h) or 403(b) of the Code; and

                    (2)  compensation deferred under an eligible

deferred compensation plan within the meaning of section 457(b)

of the Code; and

                    (3)  employee contributions described in

section 414(h)(2) that are picked up by the employing unit and

thus are treated as employer contributions.

          For the purpose of this Subsection (c), the Company may

elect to consider only compensation as defined above for that

portion of the Plan Year or the calendar year ending within the

Plan Year during which the Employee was an Eligible Employee,

provided that this election is applied uniformly to all Eligible

Employees for the Plan Year.

               (d)  for the purpose of the definition of "Highly

Compensated Employee" in this Article (except as otherwise

provided in such definition), the Employee's "compensation" as

such word is defined in Treas. Reg. Section 1.415-2(d)(10) but including

amounts that are excluded from gross income under section 125,

402(a)(8), 402(h) or 403(b) of the Code.

               (e)  effective September 1, 1989, with respect to

any Plan Year, only compensation not in excess of the amount to

which the dollar limit of Code section 401(a)(17), as amended,

has been indexed shall be taken into account for purposes of

Subsections (a), (b) and (c) of this definition, except that this

Subsection (e) shall not apply for purposes of Section 3.9.  In

determining Compensation for purposes of this limitation, the

rules of section 414(q)(6) of the Code shall apply, except in

applying such rules, the term "family" shall include only the

spouse of the Employee and any lineal descendants who have not

attained Age 19 before the close of the Plan Year.  In applying

the rules of section 414(q)(6) of the Code, the limit of this

Subsection (e) shall be allocated among family members in

proportion to their Compensation as defined in Subsection (a)

without regard to this Subsection (e).

          "Contribution Percentage" means for any Eligible

Employee for a given Plan Year, the ratio of:

               (a)  the sum of

                    (1)  such Eligible Employee's Matching

Contributions for the Plan Year (to the extent not included in

such Eligible Employee's Actual Deferral Percentage for such Plan

Year), plus

                    (2)  in the case of any Highly Compensated

Eligible Employee, any employee contributions and employer

matching contributions, including any elective deferrals

recharacterized as employee contributions, under any other

qualified retirement plan, other than an employee stock ownership

plan as defined in section 4975(e)(7) of the Code or a tax credit

employee stock ownership plan as defined in section 409(a) of the

Code, maintained by the Participating Company or any Affiliated

Company, plus

                    (3)  at the election of the Committee, any

portion of the Eligible Employee's Salary Reduction Contributions

for the Plan Year or elective deferrals under any other qualified

retirement plan maintained by a Participating Company or any

Affiliated Company that may be disregarded without causing this

Plan or such other qualified retirement plan to fail to satisfy

the requirements of section 401(k)(3) of the Code and the

regulations issued thereunder; to

               (b)  The Eligible Employee's Compensation for the

Plan Year or the calendar year ending within the Plan Year.

          "Covered Employee" means any Employee who (a) is

employed by a Participating Company, and (b) is not covered by a

collective bargaining agreement, unless such agreement

specifically provides for participation hereunder.  An Employee

who is such solely by reason of being a leased employee shall not

be a Covered Employee.

          "Effective Date" means September 1, 1987, the effective

date of this amended and restated Plan.

          "Eligible Employee" means an Employee who has become an

Eligible Employee as set forth in Section 2.2, and who has

remained a Covered Employee at all times thereafter.

          "Employee" means an individual who is employed by a

Participating Company or an Affiliated Company.  An individual

who is not otherwise employed by a Participating Company or

Affiliated Company shall be deemed to be employed by such Company

if he is a leased employee with respect to whose services such

Participating Company or Affiliated Company is the recipient

within the meaning of Code section 414(n) or 414(o), but to whom

Code section 414(n)(5) does not apply.

          "Employment Commencement Date" means, for any Employee,

the date on which he is first entitled to be credited with an

"Hour of Service" described in Paragraph (a)(1) of the definition

of Hour of Service in this Article.

          "ERISA" means the Employee Retirement Income Security

Act of 1974, as amended.

          "Fixed Income Fund" means a separate fund maintained by

the Trustee prior to March 1, 1990 which provides a fixed rate of

income on amounts transferred by Participants pursuant to Section

12.1.

          "Fund" means the fund established for this Plan,

administered under the Trust Agreement, out of which benefits

payable under this Plan shall be paid.

          "Highly Compensated Eligible Employee" means an

Eligible Employee who is (or is treated as) a Highly Compensated

Employee.

          "Highly Compensated Employee" means an Employee who

during the current Plan Year or the immediately preceding Plan

Year:

               (a)  was a five-percent owner, as defined in

section 416(i) of the Code;

               (b)  received more than $75,000 (as indexed) in

Compensation from a Participating Company or an Affiliated

Company;

               (c)  received more than $50,000 (as indexed) in

Compensation from a Participating Company or an Affiliated

Company and was among the top 20% of Employees of all

Participating Companies and Affiliated Companies ranked by

Compensation (excluding Employees described in section 414(q)(8)

of the Code to the extent (1) permitted under the Code and

regulations thereunder and (2) elected by the Committee, for

purposes of identifying the number of Employees in the top 20%);

or

               (d)  was among the 50 officers of a Participating

Company or an Affiliated Company (or, if lesser, the greater of 3

or 10% of all Employees, excluding Employees described in section

414(q)(8) of the Code, to the extent (1) permitted under the Code

and regulations thereunder and (2) elected by the Committee for

purposes of identifying the top 20%) and received Compensation of

more than $45,000 (as indexed); provided, however, that, if no

officer has satisfied the compensation requirement described

above during either the current Plan Year or the immediately

preceding Plan Year, the highest paid officer for such year shall

be treated as a Highly Compensated Employee.

Notwithstanding Subsections (b)-(d) of this definition, an

Employee, other than a five-percent owner, who was not a Highly

Compensated Employee in the preceding Plan Year is a Highly

Compensated Employee for the current Plan Year only if he is

among the top 100 Employees of all Participating Companies and

Affiliated Companies ranked by Compensation for the current Plan

Year.

          If an Employee is, during the current Plan Year or the

immediately preceding Plan Year, a family member of either a 5

percent owner who is an Employee or a former Employee or a Highly

Compensated Employee who is one of the 10 most highly compensated

Employees ranked by compensation during such year, then the

family member and the 5 percent owner or Highly Compensated

Employee shall be treated as a single Highly Compensated

Employee, and the Compensation and elective deferrals, employee

contributions and employer matching contributions of such family

member and 5 percent owner or Highly Compensated Employee shall

be aggregated in determining the Actual Deferral Percentage and

Contribution Percentage of such "single" Highly Compensated

Employee.  For purposes of this definition, "family member" shall

include the spouse, lineal ascendants and descendants of the

Employee or former Employee and the spouse of such lineal

ascendants and descendants.

          "Hour of Service" means, for any Employee, a credit

awarded with respect to:

               (a)  except as provided in (b) or (c),

                    (1)  each hour for which he is directly or

indirectly paid or entitled to payment by a Participating Company

or an Affiliated Company for the performance of employment

duties; or

                    (2)  each hour for which he is entitled,

either by award or agreement, to back pay from a Participating

Company or an Affiliated Company, irrespective of mitigation of

damages; or

                    (3)  each hour for which he is directly or

indirectly paid or entitled to payment by a Participating Company

or an Affiliated Company on account of a period of time during

which no duties are performed due to vacation, holiday, illness,

incapacity (including disability), jury duty, layoff, leave of

absence, or military duty; or

               (b)  For any period that includes any hours for

which an Hour of Service would otherwise be credited to an

Employee under (a), above, the Committee may, in accordance with

rules applied in a uniform and non-discriminatory manner, elect

instead to credit Hours of Service using one or more of the

following equivalencies:

Basis Upon Which Records           Credit Granted to Individual
     Are Maintained                       For Period

     shift                         actual hours for full shift

     day                            10 Hours of Service

     week                           45 Hours of Service

     semi-monthly period            95 Hours of Service

     month                         190 Hours of Service

               (c)  Anything to the contrary in Subsection (a) or

(b) notwithstanding:

                    (1)  No Hours of Service shall be credited to

an Employee for any period merely because, during such period,

payments are made or due him under a plan maintained solely for

the purpose of complying with applicable workers' compensation,

unemployment compensation, or disability insurance laws.

                    (2)  No more than 501 Hours of Service shall

be credited to an Employee under Paragraph (a)(3) of this

definition on account of any single continuous period during

which no duties are performed by him, except to the extent

otherwise provided in the Plan.

                    (3)  No Hours of Service shall be credited to

an Employee with respect to payments solely to reimburse for

medical or medically related expenses.

                    (4)  No Hours of Service shall be credited

twice.

                    (5)  Hours of Service shall be credited at

least as liberally as required by the rules set forth in U.S.

Department of Labor Reg. Section 2530.200b-2(b) and (c).

                    (6)  In the case of an Employee who is such

solely by reason of service as a leased employee within the

meaning of section 414(n) or 414(o) of the Code, Hours of Service

shall be credited as if such Employee were employed and paid with

respect to such service (or with respect to any related absences

or entitlements) by the Participating Company or Affiliated

Company that is the recipient thereof.

          "Investment Medium" means any fund, contract,

obligation, or other mode of investment selected by the Committee

to which a Participant may direct the investment of the assets of

his Account.

          "Limitation Year" means the Plan Year or such other

12-consecutive-month period as may be designated by the Company.

          "Matching Contributions" means, for any Participant,

the sum of his Pre-1994 Matching Contributions and Post-1993

Matching Contributions.

          "Normal Retirement Age" means, for any Participant, the

date on which he attains Age 65.

          "Normal Retirement Date" means, for any Participant,

the first day of the month coincident with or next following his

attainment of Normal Retirement Age.

          "Participant" means an individual for whom one or more

Accounts are maintained under the Plan.

          "Participating Company" means the Company and each

other organization which is authorized by the Board of Directors

to adopt this Plan by action of its board of directors or other

governing body.

          "Payroll Period" means a weekly, bi-weekly,

semi-monthly, or monthly pay period or such other standard pay

period of the Participating Company applicable to the class of

Employees of which the Eligible Employee is a part.

          "Plan" means the Westmoreland Coal Company and

Affiliated Companies Employees' Savings/Retirement Plan, as

renamed effective March 1, 1990 and as formerly known as the

Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, a profit sharing plan, as set forth herein.

          "Plan Year" means each 12-consecutive month period that

begins on September 1 and ends on the next following August 31.

          "Post-1989 Rollover Contributions" means, for any

Participant, his rollover contributions made after

February 28, 1990 as provided in Section 15.1.

          "Post-1993 Matching Contributions" means, for any

Participant, the contributions made by the Company after

November 30, 1993 pursuant to Section 3.4.

          "Post-1989 Salary Reduction Contributions" means, for

any Participant, contributions made on his behalf after

February 28, 1990 as provided in Section 3.1(a).

          "Pre-1994 Matching Contributions" means, for any

Participant, the Company Stock contributed by the Company prior

to December 1, 1993 pursuant to Section 3.4.

          "Pre-1990 Rollover Contributions" means, for any

Participant, his rollover contributions made prior to

March 1, 1990 as provided in Section 15.1.

          "Pre-1990 Salary Reduction Contributions" means, for

any Participant, contributions made on his behalf prior to

March 1, 1990 as provided in Section 3.1(a).

          "Qualified Domestic Relations Order" means a domestic

relations order (within the meaning of section 414(p)(1)(B) of

the Code) which creates or recognizes the existence of an

Alternate Payee's rights to, or assigns to an Alternate Payee the

right to receive all or a portion of the benefits payable with

respect to a Participant under the Plan, and is determined by the

Committee to satisfy the requirements of section 414(p) of the

Code.

          "Quarterly Status Date" means each November 30, last

day of February, May 31, August 31 of any year.

          "Required Beginning Date" means, for any Participant,

               (a)  if he attained Age 70-1/2 before

January 1, 1988, and is not a 5-percent owner (within the meaning

of section 416 of the Code) of a Participating Company at any

time during the five-Plan-Year period ending in the calendar year

in which he attained Age 70-1/2, or thereafter, April 1 of the

calendar year following the later of the calendar year in which

he has a Separation from Service or the calendar year in which he

attained Age 70-1/2;

               (b)  if he attained Age 70-1/2 before

January 1, 1988, and is a 5-percent owner (within the meaning of

section 416 of the Code) of a Participating Company at any time

during the five-Plan-Year period ending in the calendar year in

which he attained Age 70-1/2, or thereafter, the later of (1)

December 31, 1987 (2) April 1 of the calendar year following the

calendar year in which he attained Age 70-1/2 or (3) April 1 of

the calendar year in which he becomes a 5-percent owner.

               (c)  if he attained Age 70-1/2 before

January 1, 1989 and after December 31, 1987, is not a 5-percent

owner (within the meaning of section 416 of the Code) of a

Participating Company and has not had a Separation from Service

before January 1, 1989, April 1, 1990;

               (d)  except as otherwise provided in Subsection

(c), if he attains Age 70-1/2 on or after January 1, 1988,

April 1 of the calendar year next following the calendar year in

which he attains Age 70-1/2.

          "Rollover Contributions" means, for any Participant,

the sum of his Pre-1990 Rollover Contributions and his Post-1989

Rollover Contributions.

          "Salary Reduction Contributions" means, for any

Participant, the sum of his Pre-1990 Salary Reduction

Contributions and his Post-1989 Salary Reduction Contributions.

          "Separation from Service" means, for any Employee, his

death, retirement, resignation, discharge or any absence that

causes him to cease to be an Employee.

          "Spouse" means the person to whom a Participant is

married on any date of reference.

          "Total Disability" means, with respect to any

Participant:

               (a)  effective prior to September 1, 1995, a

disability with respect to which he is eligible for and receiving

disability benefits under the Federal Social Security Act and

which:  (1) prevents the Participant from engaging in any

substantial gainful activity, (2) can be expected to result in

death or to be of long-continued and indefinite duration, and (3)

is not self-inflicted, including a physical or mental impairment

from the voluntary use of alcohol or narcotics, or the result of

the commission of a crime by the Participant; and

               (b)  effective after August 31, 1995, a disability

with respect to which he is eligible for and receiving benefits

under a long-term disability program sponsored by a Participating

Company or an Affiliated Company and which can reasonably be

expected to be of long-continued and indefinite duration

rendering him unable to return to work.

          "Trust Agreement" means any agreement and declaration

of trust executed under this Plan.

          "Trustee" means the corporate trustee or one or more

individuals collectively appointed and acting under the Trust

Agreement.

          "Valuation Date" means, prior to March 1, 1995, each

Quarterly Status Date and each interim date on which the

Committee determines that a valuation of the Fund shall be made.

Effective after February 28, 1995, "Valuation Date" means, for

any Investment Medium, each business day, except for such

business days on which Dreyfus Retirement Services, or its

successor, determines that a valuation of such Investment Medium

shall not be made.

          "Voluntary Contributions" means a Participant's

voluntary contributions made prior to June 1, 1984 pursuant to

the Plan as in effect at such time.

                           ARTICLE II

           TRANSITION AND ELIGIBILITY TO PARTICIPATE

       .1   Rights Affected and Preservation of Accrued Benefit.  Except

as provided to the contrary herein, the provisions of this

amended and restated Plan shall apply only to Employees who

complete an Hour of Service on or after the Effective Date.  The

rights of any other individual shall be governed by the Plan as

in effect upon his Separation from Service, except to the extent

expressly provided in any amendment adopted subsequently thereto.

       .2        Eligibility to Participate - Salary Reduction

Contributions.

               (a)  Each Covered Employee as of the Effective

Date who was eligible to participate in the Plan immediately

prior to the Effective Date shall continue to be an Eligible

Employee as of the Effective Date.

               (b)  Each Covered Employee who was not eligible to

participate immediately prior to the Effective Date shall become

an Eligible Employee upon the first day of the month following

the date he is credited with 1,000 or more Hours of Service if he

is then a Covered Employee.

               (c)  If an individual is not a Covered Employee on

the date he would otherwise become an Eligible Employee pursuant

to Subsection (b) of this Section, he shall become an Eligible

Employee as of the first date thereafter on which he is a Covered

Employee.

               (d)  An Eligible Employee who ceases to be a

Covered Employee, by Separation from Service or otherwise, and

who later becomes a Covered Employee, shall become an Eligible

Employee as of the date on which he first again completes an Hour

of Service as a Covered Employee.

       .1   Election to Make Salary Reduction Contributions.  Each

Eligible Employee may elect to make Salary Reduction

Contributions and become an Active Participant by filing a

written notice of such election with the Committee on such form

provided for that purpose.  Such notice shall authorize the

Participating Company to reduce such Eligible Employee's

Compensation by an amount determined in accordance with Section

3.1 and to make Salary Reduction Contributions on such Eligible

Employee's behalf in the amount of such reduction.  Such election

shall become effective as soon as administratively possible, but

no sooner than the first day of the Payroll Period next following

receipt of the election by the Committee.

       .2        Participation in Matching Contributions.  An Eligible

Employee shall share in Matching Contributions under Section 3.4

for any Plan Year if Salary Reduction Contributions are made on

his behalf in such Plan Year.

       .3        Data.  Each Employee shall furnish to the Committee

such data as the Committee may consider necessary for the

determination of the Employee's rights and benefits under the

Plan and shall otherwise cooperate fully with the Committee in

the administration of the Plan.

                          ARTICLE III

                   CONTRIBUTIONS TO THE PLAN

       .3   Salary Reduction Contributions.

               (a)  When an Eligible Employee files an election

under Section 2.3 to have Salary Reduction Contributions made on

his behalf, he shall elect the percentage by which his

Compensation shall be reduced on account of such Salary Reduction

Contributions.  Effective prior to March 1, 1995, subject to

Section 3.9, this percentage may be between one percent (1%) and

ten percent (10%) of such Compensation, rounded to the nearer

whole percent.  Effective after February 28, 1995, subject to

Section 3.9, this percentage may be between one percent (1%) and

fifteen percent (15%) of such Compensation, rounded to the nearer

whole percent.  The Participating Company shall contribute an

amount equal to such percentage of the Eligible Employee's

Compensation to the Fund for credit to the Eligible Employee's

Salary Reduction Account provided that such contributions may be

prospectively limited as provided in Section 3.8.

               (b)  Salary Reduction Contributions made on behalf

of an Eligible Employee under this Plan together with elective

deferrals under any other plan or arrangement maintained by any

Participating Company or Affiliated Company shall not exceed

$7,000 (as indexed) (as adjusted in accordance with section

402(g) of the Code and regulations thereunder) for any calendar

year.  To the extent necessary to satisfy this limitation for any

year:

                    (1)  elections under Subsection (a) of this

Section shall be prospectively restricted; and,

                    (2)  after application of Subparagraph (1),

the excess Salary Reduction Contributions and excess elective

deferrals under any other plan or arrangement maintained by any

Participating Company or Affiliated Company (with earnings

thereon, but reduced by any amounts previously distributed under

Subsection (a) of Section 3.8 for the year) shall be paid to the

Participant on or before the April 15 first following the

calendar year in which such contributions were made.

If the Salary Reduction Contributions plus elective deferrals

described above do not exceed such limitation, but Salary

Reduction Contributions, plus the elective deferrals, as defined

in section 402(g)(3) of the Code, under any other plan for any

Participant exceed such limitation for any calendar year, upon

the written request of the Participant made on or before the

March 1 first following such calendar year, the excess, including

any earnings attributable thereto, designated by the Participant

to be distributed from the Plan shall be paid to the Participant

on or before the April 15 first following such calendar year.

       .4   Change of Percentage Rate.  A Participant may without

penalty change the percentage of Compensation designated by him

as his contribution rate under Subsection (a) of Section 3.1, to

any percentage permitted by such Subsection, and such percentage

shall remain in effect until so changed.  Effective prior to

March 1, 1995, any such change shall become effective as of the

September 1, December 1, March 1 or June 1 next following receipt

of the change by the Committee, provided that the Committee

receives written notice of such change by the fifteenth day of

the month prior to the effective date of the change.  Effective

after February 28, 1995, a Participant may change the percentage

of Compensation designated by him as his contribution rate under

Subsection (a) of Section 3.1 on any day of a calendar month,

provided that only one change may be made in any calendar month.

Such change shall become effective as soon as administratively

possible, but no sooner than the first day of the Payroll Period

next following receipt of notice of the change by the Committee.

       .5        Discontinuance of Salary Reduction Contributions.  A

Participant may discontinue his Salary Reduction Contributions at

any time.

                  (a)  Effective prior to March 1, 1995,

such discontinuance shall become effective as of the first day of

the Payroll Period next following receipt of the discontinuance

by the Committee, provided that the Committee receives written

notice of the discontinuance at least 15 days prior to the first

day of such Payroll Period.  A Participant who discontinues his

Salary Reduction Contributions prior to March 1, 1995 may not

resume his Salary Reduction Contributions until the first day of

the Payroll Period after any Quarterly Status Date that follows a

3-month period of suspension of Salary Reduction Contributions.

                    (b)  Effective after February 28, 1995, a

discontinuance of Salary Reduction Contributions shall become

effective as soon as administratively feasible but no sooner than

the first day of the Payroll Period next following receipt of

notice of the change by the Committee.  A Participant who

discontinues his Salary Reduction Contributions after

February 28, 1995 may not resume his Salary Reduction

Contributions until the first day of the Payroll Period following

the first day of any calendar month.

       .6   Matching Contribution.

               (a)  Subject to Sections 3.7 and 3.9, the

Participating Company shall contribute the following amounts to

the Fund which shall be invested as provided in Subsections (b)

and (c) of this Section:

                    (1)  for any Payroll Period beginning before

September 1, 1988, an amount equal to one hundred percent (100%)

of all Participants' Salary Reduction Contributions for such Plan

Year, offset by the amount, if any, of Matching Contributions

forfeited during such Plan Year, provided that such contributions

may be prospectively limited as provided in Section 3.8 and

provided further that the contribution under this Section for any

Plan Year shall not cause the total contributions by the

Participating Company to exceed the maximum allowable current

deduction under the applicable provisions of the Code.  Matching

Contributions shall be credited to the Matching Contribution

Accounts of Participants in proportion to their Salary Reduction

Contributions for the Plan Year; and

                    (2)  for any Payroll Period beginning on or

after September 1, 1988, an amount equal to fifty percent (50%)

of all Participants' Salary Reduction Contributions for such Plan

Year not in excess of five percent (5%) of each Eligible

Employee's Compensation, offset by the amount, if any, of

Matching Contributions forfeited during such Plan Year, provided

that such contributions may be prospectively limited as provided

in Section 3.8 and provided further that the contribution under

this Section for any Plan Year shall not cause the total

contributions by the Participating Company to exceed the maximum

allowable current deduction under the applicable provisions of

the Code.  Matching Contributions shall be credited to the

Matching Contribution Accounts of Participants in proportion to

their Salary Reduction Contributions for the Plan Year not in

excess of five percent (5%) of each Eligible Employee's

Compensation.

               (b)  Pre-1994 Matching Contributions shall be

invested in common stock of the Company; except that, effective

with respect to Pre-1994 Matching Contributions allocated to a

Participant's Account after February 28, 1993, a Participant may

elect, effective as of any March 1, June 1, September 1 or

December 1, in such manner as the Committee may prescribe for

this purpose, to have Pre-1994 Matching Contributions allocated

to his Account in any Plan Year quarter invested in either common

or preferred stock of the Company; provided, that, (1) the

Participant elects to have the entire amount of Pre-1994 Matching

Contributions allocated to his Account in any Plan Year quarter

invested in either common or preferred stock of the Company, and

(2) such election may not be subsequently modified or revoked by

the Participant until the Participant attains Age 55 and directs

the investment of Company Stock in accordance with Section 12.1

and (3) the Committee receives such election on or before the

fifteenth day of the month preceding such March 1, June 1,

September 1 or December 1.

               (c)  Post-1993 Matching Contributions allocated to

a Participant's Account shall be invested in any Investment

Medium selected by the Participant in accordance with Section

12.2.

       .1   Timing and Deductibility of Contributions.  Matching

Contributions for any Plan Year under this Article shall be made

no later than the last date on which amounts so paid may be

deducted for Federal income tax purposes for the taxable year of

the employer in which the Plan Year ends.  All Participating

Company contributions are expressly conditioned upon their

deductibility for Federal income tax purposes.  Amounts

contributed as Salary Reduction Contributions or Rollover

Contributions will be remitted to the Trustee as soon as

practicable, but no later than 90 days after the date on which

such contributions were received or withheld from the

Participant's Compensation.

       .2        Fund.  The contributions deposited by the Participating

Company in the Fund in accordance with this Article shall

constitute a fund held for the benefit of Participants and their

eligible beneficiaries under and in accordance with this Plan.

No part of the principal or income of the Fund shall be used for,

or diverted to, purposes other than for the exclusive benefit of

such Participants and their eligible beneficiaries (including

necessary administrative costs); provided, that in the case of a

contribution made by the Participating Company as a mistake of

fact, or for which a tax deduction is disallowed, in whole or in

part, by the Internal Revenue Service, the Participating Company

shall be entitled to a refund of said contributions, which must

be made within one year after payment of a contribution made as a

mistake of fact, or within one year after disallowance.

       .3        Limitation on Salary Reduction Contributions and

Matching Contributions.

               (a)  For any Plan Year, the Average Actual

Deferral Percentage for the Highly Compensated Eligible Employees

shall not exceed the greater of:

                    (1)  one hundred twenty-five percent (125%)

of the Average Actual Deferral Percentage for all other Eligible

Employees; or

                    (2)  the lesser of:

                         (A)  two hundred percent (200%) of the

Average Actual Deferral Percentage for all other Eligible

Employees; or

                         (B)  two percent (2%) plus the Average

Actual Deferral Percentage for all other Eligible Employees. 

                   (b) For any Plan Year, the Average Contribution

Percentage for the Highly Compensated Eligible Employees shall not

exceed the greater of:

                    (1)  one hundred twenty-five (125%) of the

Average Contribution Percentage for all other Eligible Employees;

or

                    (2)  the lesser of:

                         (A)  two hundred percent (200%) of the

Average Contribution Percentage for all other Eligible Employees;

or

                         (B)  two percent (2%) plus the Average

Contribution Percentage for all other Eligible Employees.

               (c)  For any Plan Year beginning after

December 31, 1988, the sum of the Average Actual Deferral

Percentage and the Average Contribution Percentage for the Highly

Compensated Eligible Employees shall not exceed the greater of:

                    (1)  the sum of:

                         (A)  one hundred twenty-five percent

(125%) of the greater of the Average Actual Deferral Percentage

or the Average Contribution Percentage for all other Eligible

Employees; plus

                         (B)  the lesser of:

                              (i)  two hundred percent (200%) of

the lesser of the Average Actual Deferral Percentage or the

Average Contribution Percentage for all other Eligible Employees;

or

                             (ii)  two percent (2%) plus the

lesser of the Average Actual Deferral Percentage or the Average

Contribution Percentage for all other Eligible Employees; or

                    (2)  the sum of:

                         (A)  one hundred twenty-five percent

(125%) of the lesser of the Average Actual Deferral Percentage or

the Average Contribution Percentage for all other Eligible

Employees; plus

                         (B)  the lesser of:

                              (i)  two hundred percent (200%) of

the greater of the Average Actual Deferral Percentage or the

Average Contribution Percentage for all other Eligible Employees;

or

                             (ii)  two percent (2%) plus the

greater of the Average Actual Deferral Percentage or the Average

Contribution Percentage for all other Eligible Employees.

               (d)  For purposes of this Section, the Salary

Reduction Contributions and Matching Contributions, respectively,

of any 5% owner or other Highly Compensated Employee who is one

of the top 10 Employees ranked by pay (without regard to this

sentence) for the Plan Year or the preceding Plan Year shall be

increased by the amount of the Salary Reduction Contributions and

Matching Contributions, respectively of any Employee who is a

spouse or lineal ascendant or descendant (or a spouse thereof)

("family member") of such Highly Compensated Employee, and the

Compensation of the former shall be increased by the Compensation

of the latter, and such family member and such Highly Compensated

Employee shall be treated as a single Highly Compensated Eligible

Employee and such family member shall not be treated as a

separate Eligible Employee for purposes of applying this Section.

The application of this Subsection (d) and the determination of

the Actual Deferral Percentage and Contribution Percentage of

such single Highly Compensated Eligible Employee shall be made in

accordance with sections 414(q), 401(k) and 401(m) of the Code

and regulations thereunder.

               (e)  If the Plan and any other plan(s) maintained

by a Participating Company or an Affiliated Company are treated

as a single plan for purposes of section 401(a)(4) or section

410(b) of the Code, the limitations in Subsections (a) through

(d) of this Section shall be applied by treating the Plan and

such other plan(s) as a single plan.

               (f)  The application of this Section shall satisfy

sections 401(k) and 401(m) of the Code and regulations thereunder

and such other requirements as may be prescribed by the Secretary

of the Treasury.

       .7   Prevention of Violation of Limitation on Salary Reduction

Contributions and Matching Contributions.  The Committee shall

monitor the level of Participants' Salary Reduction Contributions

and Matching Contributions and elective deferrals, employee

contributions, and employer matching contributions under any

other qualified retirement plan maintained by a Participating

Company or any Affiliated Company to insure against exceeding the

limits of Section 3.7.  To the extent practicable, the Plan

Administrator may prospectively limit (i) some or all of the

Highly Compensated Eligible Employees' Salary Reduction

Contributions to reduce the Average Actual Deferral Percentage of

the Highly Compensated Eligible Employees to the extent necessary

to satisfy subsection (a) of Section 3.7 and/or (ii) some or all

of the Highly Compensated Eligible Employees' Matching

Contributions to reduce the Average Contribution Percentage of

the Highly Compensated Eligible Employees to the extent necessary

to satisfy subsection (b) of Section 3.7 and/or (iii) some or all

of the Highly Compensated Eligible Employees' Salary Reduction

Contributions, and Matching Contributions to the extent necessary

to satisfy subsection (c) of Section 3.7.  If the Committee

determines after the end of the Plan Year that the limits of

Section 3.7 may be or have been exceeded, it shall take the

appropriate following action for such Plan Year:

               (a)  (1)  The Average Actual Deferral Percentage

for the Highly Compensated Eligible Employees shall be reduced to

the extent necessary to satisfy Subsection (a) of Section 3.7. 

                 (2) The reduction shall be accomplished by reducing

the maximum Actual Deferral Percentage for any Highly Compensated

Eligible Employee to an adjusted maximum Actual Deferral Percentage,

which shall be the highest Actual Deferral Percentage that would

cause one of the tests in Subsection 3.7(a) to be satisfied, if each Highly

Compensated Eligible Employee with a higher Actual Deferral Percentage

had instead the adjusted maximum Actual Deferral Percentage, reducing

the Highly Compensated Eligible Employee's Salary Reduction Contributions

and elective deferrals under any other qualified retirement plan

maintained by the Participating Company or any Affiliated Company

(less any amounts previously distributed under Section 3.1 for the

year) in order, beginning with the Highly Compensated Eligible Employee(s)

with the highest Actual Deferral Percentage; provided, however,

that excess contributions shall be allocated to Eligible Employees

who are subject to the family member aggregation rules of section

414(q)(6) of the Code in the manner prescribed by regulations.

                    (3)  Not later than the end of the Plan Year

following the close of the Plan Year for which the Salary

Reduction Contributions were made, the difference between a

Highly Compensated Eligible Employee's Actual Deferral Percentage

and the Highly Compensated Eligible Employee's adjusted maximum

Actual Deferral Percentage, at the Committee's direction, shall

be paid to the Highly Compensated Eligible Employee, with

earnings attributable thereto (as determined in accordance with

applicable Treasury Regulations); provided, however, that for any

Participant who is also a participant in any other qualified

retirement plan maintained by the Participating Company or any

Affiliated Company under which the Participant makes elective

deferrals for such year, the Committee shall coordinate

corrective actions under this Plan and such other plan for the

year.

               (b)  (1)  The Average Contribution Percentage for

the Highly Compensated Eligible Employees shall be reduced to the

extent necessary to satisfy at least one of the tests in

Subsection (b) of Section 3.7.

                    (2)  The reduction shall be accomplished by

reducing the maximum Contribution Percentage for any Highly

Compensated Eligible Employee to an adjusted maximum Contribution

Percentage, which shall be the highest Contribution Percentage

that would cause one of the tests in Section 3.7(b) to be

satisfied, if each Highly Compensated Eligible Employee with a

higher Contribution Percentage had instead the adjusted maximum

Contribution Percentage, reducing, in the following order of

priority, the Highly Compensated Eligible Employees' Matching

Contributions and employee contributions and employer matching

contributions under any other qualified retirement plan

maintained by the Participating Company or an Affiliated Company,

in order beginning with the Highly Compensated Eligible

Employee(s) with the highest Contribution Percentage; provided,

however, that excess contributions shall be allocated to Eligible

Employees who are subject to the family member aggregation rules

of section 414(q)(6) of the Code in the manner prescribed in

regulations.

                    (3)  Not later than the end of the Plan Year

following the close of the Plan Year for which such contributions

were made, the difference between a Highly Compensated Eligible

Employee's Contribution Percentage and the Highly Compensated

Eligible Employee's adjusted maximum Contribution Percentage,

with earnings attributable thereto (as determined in accordance

with applicable Treasury Regulations), at the Committee's

direction, shall be paid to the Highly Compensated Eligible

Employee;

provided, however, that, for any Participant who is also a

participant in any other qualified retirement plan maintained by

the Participating Company or any Affiliated Company under which

the Participant makes employee contributions or is credited with

employer matching contributions for the year, the Committee shall

coordinate corrective actions under this Plan and such other plan

for the year.

               (c)  (1)  The Average Contribution Percentage

and/or the Average Actual Deferral Percentage (as determined

under Subparagraph (2) below) for the Highly Compensated Eligible

Employees shall be reduced to satisfy the test in Subsection (c)

of Section 3.7 in a manner and to the extent determined by the

Committee.

                    (2)  The reductions shall be accomplished in

the same manner as is set forth in Subsections (a) and (b) of

Section 3.8, whichever is appropriate.  A reduction to the

Average Actual Deferral Percentage shall be charged against the

appropriate Highly Compensated Eligible Employees' Salary

Reduction Accounts.  A reduction to the Average Contribution

Percentage shall be charged against the appropriate Highly

Compensated Eligible Employees' Matching Contribution Accounts.

Notwithstanding the foregoing, for any Participant who is also a

participant in any other qualified retirement plan maintained by

a Participating Company or any Affiliated Company under which the

Participant makes employee contributions or elective deferrals or

is credited with employer matching contributions for such year,

the Committee shall coordinate corrective actions under this Plan

and such other plan for the year.

               (d)  Effective September 1, 1988, if the

corrective payment to a Highly Compensated Eligible Employee of

his Salary Reduction Contributions pursuant to Paragraph (a)(3)

causes Matching Contributions made on his behalf for the Plan

Year (excluding such Matching Contributions that were paid to the

Participant pursuant to Subsection (b)(2) or Subsection (c) of

this Section) to exceed five percent (5%) of his remaining Salary

Reduction Contributions for the Plan Year, the Matching

Contributions in excess of five percent (5%) of his Salary

Reduction Contributions for the Plan Year that were not

distributed to him shall be forfeited, and used to offset future

Matching Contributions.

               (e)  If the Plan and any other plan maintained by

a Participating Company or an Affiliated Company are treated as a

single plan pursuant to Subsection (e) of Section 3.7, the

Committee shall coordinate corrective actions under the Plan and

such other plan for the year.

       .8   Maximum Allocation.  The provisions of this Section shall be

construed to comply with section 415 of the Code.

               (a)  Notwithstanding anything in this Plan to the

contrary, in no event shall the sum of:

                    (1)  any Matching Contributions, Salary

Reduction Contributions and other employer contributions; any

forfeitures, and any employee contributions allocated for any

Limitation Year to any Participant (including any such amounts

distributed pursuant to Section 3.8 but not amounts distributed

pursuant to Subsection (b) (c) of Section 3.1) under this and any

other defined contribution plan maintained by the Participating

Company or any 50% Affiliated Company; and

                    (2)  all amounts allocated to any Participant

after March 31, 1984 to an individual medical account (within the

meaning of Code section 415(l)(2)) which is part of a pension or

annuity plan maintained by a Participating Company or any 50%

Affiliated Company; and

                    (3)  all amounts derived from contributions

paid or accrued after December 31, 1985, in taxable years ending

after such date which are attributable to post-retirement medical

benefits allocated to a separate account of a Participant who is

a key employee, as defined in section 419A(d)(3) of the Code,

under a welfare benefit fund maintained by a Participating

Company or any 50% Affiliated Company;

exceed the lesser of $30,000, (or such other dollar limitation in

effect for the Limitation Year under section 415(c)(1)(A) of the

Code) or twenty-five percent (25%) of such Participant's

Compensation for the Limitation Year.  The 25% Compensation

limitation shall not apply to any contribution for medical

benefits (within the meaning of section 401(h) or 419A(f)(2) of

the Code) which is otherwise treated as an annual addition under

section 415(l)(1) or 419A(d)(2) of the Code.

               (b)  If the amount otherwise allocable to the

Account of a Participant would exceed the amount described in

Subsection (a) of this Section as a result of the reallocation of

forfeitures, a reasonable error in estimating the Participant's

Compensation, a reasonable error in determining the amount of

Salary Reduction Contributions that may be made with respect to a

Participant under the limits of this Section or such other

circumstances as permitted by law, the Committee shall determine

which portion, if any, of such excess amount is attributable to

the Participant's Salary Reduction Contributions, and/or Matching

Contributions until such amount has been exhausted, and shall

take the following appropriate steps to correct such violation:

                    (1)  Excess Salary Reduction Contributions

and earnings thereon shall be paid to the Participant as soon as

is administratively feasible.

                    (2)  (A)  While the Participant remains a

Covered Employee, his excess Matching Contributions shall be held

in a suspense account (which shall share in investment gains and

losses of the Fund) by the Trustee until the following Plan Year

(or any succeeding Plan Years), at which time such amounts shall

be allocated to the Participant's Account before any Matching

Contributions are made on his behalf for such Plan Year; and

                         (B)  When the Participant ceases to be a

Covered Employee, his excess Matching Contributions, along with

earnings thereon, held in the suspense account shall be allocated

in the following Plan Year (or any succeeding Plan Years) to the

Accounts of other Participants in the Plan.

               (c)  If, in any Limitation Year, a Participant in

this Plan is also a participant in one or more defined benefit

plans maintained by the Participating Company or any 50%

Affiliated Company, the projected annual benefit referred to in

Paragraph (c)(1) shall be reduced, if necessary, so that the sum

of the fractions described in (1) and (2) does not exceed 1.0 for

such Limitation Year.

                    (1)  Defined Benefit Fraction - a fraction,

the numerator of which is the Participant's projected annual

benefit under all such defined benefit pension plans determined

as of the close of the limitation years of such plans, and the

denominator of which is the lesser of:

                         (A)  1.25 x $90,000 (or such other

dollar limitation determined for the Limitation Year under

section 415(b)(1)(A) of the Code); or

                         (B)  one hundred forty percent (140%) of

the Participant's highest average Compensation over any three

consecutive calendar years;

provided, however, that the denominator of the defined benefit

fraction shall be determined after taking into account any

adjustments to the dollar limit described in Subparagraph (A) or

to the compensation limit described in Subparagraph (B)

prescribed by sections 415(b) or 415(d) of the Code, as

appropriate.  For the purpose of this Paragraph (1), "projected

annual benefit" means the annual benefit to which a Participant

would be entitled under the terms of a defined benefit plan if he

had continued employment until his normal retirement date under

such plan and if his compensation counted for the purpose of such

plan had continued at the same rate.

                    (2)  Defined Contribution Fraction - a

fraction, the numerator of which is the sum of the annual

additions to the Participant's accounts under all defined

contribution plans sponsored by the Participating Company or any

50% Affiliated Company for all limitation years, and the

denominator of which is the sum of the lesser of the following

amounts, determined for each of such limitation years and for

each prior limitation year of service with the Participating

Company or 50% Affiliated Company:

                         (A)  1.25 x $30,000 (or such other

dollar limitation in effect for the Limitation Year under section

415(c)(1)(A) of the Code); or

                         (B)  thirty-five percent (35%) of the

Participant's Compensation for such limitation year.

               (d)  If the Plan and the defined benefit plan

referred to in Paragraph (c)(1) satisfied section 415 of the Code

for the Plan Year ending December 31, 1986, an amount shall be

subtracted from the numerator of the fraction described in

Paragraph (c)(2) (not exceeding such numerator).  The amount to

be subtracted shall be the product of:

                    (1)  the sum of the defined contribution

fraction under Paragraph (c)(2) plus the defined benefit fraction

under Paragraph (c)(1) as of December 31, 1986 minus one,

multiplied by

                    (2)  the denominator of the defined

contribution fraction under Paragraph (c)(2) as of

December 31, 1986.

               (e)  To the extent that any qualified defined

contribution plan was in existence on July 1, 1982, the Committee

may elect to apply Paragraph (c)(2) of this Section with respect

to any Limitation Year ending after December 31, 1982 by

calculating the denominator under Paragraph (c)(2) using an

alternate amount for all Limitation Years ending before

January 1, 1983.  The alternate amount shall be equal to the

amount determined for the denominator under Paragraph (c)(2) as

in effect for the Limitation Year ending in 1982 multiplied by a

fraction, the numerator of which is the lesser of $51,875 or

thirty-five percent (35%) of the Participant's Compensation for

the Limitation Year ending in 1981, and the denominator of which

is the lesser of $41,500 or twenty-five percent (25%) of the

Participant's Compensation for the Plan Year ending in 1981.

                           ARTICLE IV

                     PARTICIPANTS' ACCOUNTS

       .1   Accounts.  All contributions and earnings thereon may be

invested in one commingled Fund for the benefit of all

Participants.  However, in order that the interest of each

Participant may be accurately determined and computed, separate

Accounts shall be maintained for each Participant and each

Participant's Accounts shall be made up of subaccounts reflecting

his investment elections pursuant to Article XII.  These Accounts

shall represent the Participant's individual interest in the

Fund.  All contributions shall be credited to Participants'

Accounts as set forth in Article III.

       .2        Valuation.  The value of each Investment Medium in the

Fund shall be computed by the Trustee as of the close of business

on each Valuation Date on the basis of the fair market value of

the assets of the Fund.

       .3        Apportionment of Gain or Loss.  The value of the Fund

each Investment Medium in the Fund, as computed pursuant to

Section 4.2, shall be compared with the value of such Investment

Medium in the Fund as of the preceding Valuation Date.  Any

difference in the value, not including contributions or

distributions made since the preceding Valuation Date, shall be

the net increase or decrease of such Investment Medium in the

Fund, and such amount shall be ratably apportioned by the Trustee

on its books, among the Participants' Accounts which are invested

in such Investment Medium at the current Valuation Date.

       .4        Accounting for Allocations.  The Committee shall

establish or provide for the establishment of accounting

procedures for the purpose of making the allocations, valuations

and adjustments to Participants' Accounts provided for in this

Article.  From time to time such procedures may be modified for

the purpose of achieving equitable and non-discriminatory

allocations among the Accounts of Participants in accordance with

the general concepts of the Plan and the provisions of this

Article.

         4.5   Statement of Account.  As soon as reasonably

practicable following each Quarterly Status Date, the Trustee

shall provide each Participant with a statement of his Account

for the preceding Plan Year quarter.

                           ARTICLE V

                          DISTRIBUTION

       .1   General.  The interest of each Participant in the Fund shall

be distributed in the manner, in the amount, and at the time

provided in this Article, except as provided in Article VIII and

except in the event of the termination of the Plan.  The

provisions of this Article shall be construed in accordance with

section 401(a)(9) of the Code and regulations thereunder,

including, effective for distributions that commence on or after

January 1, 1989, the incidental death benefit requirements of

section 401(a)(9)(G) of the Code.

       .2        Separation from Service.  A Participant who has a

Separation from Service for reasons other than death or Total

Disability shall have his interest in his Account paid to him or

applied for his benefit in accordance with the provisions of this

Article.

       .3   Death.  If a Participant dies before his entire interest in

his Account has been paid to him, his remaining interest shall be

paid to, or applied for the benefit of, his beneficiary in

accordance with the provisions of this Article.

       .4        Total Disability.

               (a)  Effective prior to September 1, 1995, if a

Participant who is an Employee suffers a Total Disability, has a

Separation from Service due to his Total Disability, and remains

Totally Disabled for a period of 6 consecutive months, his

Account shall be paid to him or applied for his benefit in

accordance with the provisions of this Article following the

determination of his Total Disability and his Separation from

Service.

               (b)  Effective after August 31, 1995, if a

Participant who is an Employee suffers a Total Disability, his

Account shall be paid to him or applied for his benefit in

accordance with the provisions of this Article following the

determination of his Total Disability.

               (c)  Total Disability shall be determined by the

Committee, which may consult with a medical examiner selected by

it.  The medical examiner shall have the right to make such

physical examinations and other investigations as may be

reasonably required to determine Total Disability.

       .1   Valuation for Distribution.  For the purposes of paying the

amounts to be distributed to a Participant or his beneficiaries

under the provisions of this Article, the value of the Fund and

the amount of the Participant's interest shall be determined in

accordance with the provisions of Article IV as of the Valuation

Date coincident with or immediately preceding the date of any

payment under this Article.  Such amount shall be adjusted to

take into account any additional contributions and forfeitures,

if any, which have been or are to be allocated to the

Participant's Account since that Valuation Date, and any

distributions or withdrawals made since that date.

Notwithstanding the above, the Participants' Account shall

be reduced by the amount necessary to repay any outstanding loan

from the Plan and interest thereon to the date the Committee

declares such loan satisfied, unless such loan is repaid as

provided in Section 9.4(e).

       .2   Timing of Distribution.

               (a)  Any Participant who has a Separation from

Service for any reason other than death shall be entitled to

receive his interest in his Account, pursuant to the following

rules:

                    (1)  Except as provided in Paragraph (a)(2),

if the Participant's interest in his Account is $3,500 or less,

or the Participant has attained Normal Retirement Age, the

Participant's Benefit Commencement Date shall be the earliest

practicable date following the Valuation Date coincident with or

next following his Separation from Service.

                    (2)  If the Participant has not attained

Normal Retirement Age and his interest exceeds, or has ever

exceeded at the time of any prior distribution, $3,500, his

Benefit Commencement Date shall be the earliest practicable date

following the Valuation Date coincident with or next following

his Separation from Service, except that, if the Participant does

not consent to such distribution, distribution of his benefits

shall commence on any later date elected by the Participant, that

is not later than his Normal Retirement Date, at which time his

interest shall be automatically paid to him, unless the

Participant elects to defer payment to a date not later than his

Required Beginning Date in accordance with Paragraph (a)(4).  A

Participant's election to receive payment prior to his Normal

Retirement Date may be made no earlier than 90 days prior to the

Benefit Commencement Date elected by the Participant.

                    (3)  The Committee shall inform each

Participant who is subject to this Paragraph (a)(2) of his right

to defer distribution.  Such notice shall be furnished not less

than 30 days nor more than 90 days prior to the date of any

distribution that occurs prior his Normal Retirement Date, except

that such notice may be furnished less than 30 days prior to the

date of distribution if (A) the Committee informs the Participant

that the Participant has the right to a period of at least 30

days after receiving such notice to consider the decision whether

to elect a distribution and the mode in which he desires such

distribution to be made, and (B) the Participant, after receiving

such notice, affirmatively elects a distribution.

                    (4)  Notwithstanding the foregoing, the

Participant's Benefit Commencement Date shall be no later than

the 60th day following the close of the Plan Year in which the

Participant attains his Normal Retirement Age or has a Separation

from Service, whichever occurs last, unless the Participant

elects in writing on a form supplied by the Committee to defer

his Benefit Commencement Date to a later date.  In no event,

however, shall a Participant's Benefit Commencement Date be later

than his Required Beginning Date, except pursuant to a valid

deferral election filed by the Participant with the Committee

before January 1, 1984.  In the event the Participant defaults on

an outstanding loan such that the unpaid balance becomes due and

payable pursuant to Article IX and the Participant fails to repay

the loan in accordance with Section 9.4(e), that portion of the

Participant's Account pledged as security for the loan shall be

applied to repay the loan and shall be deemed distributed to the

Participant within 60 days of the default; in which case, the

Participant may defer commencement of the balance of his Account

as described above.

               (b)  If a Participant dies before his entire

interest in his Account has been paid to him, his remaining

interest shall be distributed to his beneficiary commencing as

soon as practicable following the Participant's death.

               (c)  This Section shall apply to all Participants,

including Participants who had a Separation from Service or

ceased to be Covered Employees prior to January 1, 1989.

       .1   Mode of Distribution.

               (a)  If a Participant's interest under the Plan as

of his Separation from Service or death, whichever applies, does

not exceed $3,500, his interest shall be paid to him, or benefits

payable under Section 5.3 upon the death of a Participant shall

be distributed to his beneficiary, in a single sum.

               (b)  Except as provided to the contrary in

Subsection (a), a Participant or a beneficiary entitled to

benefits under Section 5.3 upon the death of a Participant may

elect in writing to have the Participant's interest paid in

accordance with either of the following modes of payment;

                    (1)  a single sum payment; or

                    (2)  an annuity contract meeting the

requirements of section 401(g) of the Code, purchased by the

Trustee at the direction of the Committee from an insurance

company licensed to do business in the state in which the

principal place of business of the Company is located, providing

payments for a term of five years, 10 years or 15 years, as

elected by the Participant or beneficiary in accordance with

rules established by the Committee for this purpose.  A

Participant may not elect a term which is longer than his life

expectancy at the date distributions begin.  All payment of

benefits under the annuity contract to a beneficiary shall be

completed within five years from the Participant's date of death.

               (c)  Benefits payable in a single sum under this

Section 5.7 shall be made in cash; except, to the extent that any

portion of the Participant's Account is invested in Company

Stock, distribution of that portion of his Account shall be made

as follows:

                    (1)  distribution with respect to a

Participant who has fewer than 10 shares of Company Stock

allocated to his Account shall be made in cash unless the

Participant files a written request with the Committee directing

that the distribution be made in Company Stock, in which event

such request shall be honored; and

                    (2)  distribution with respect to a

Participant who has 10 or more shares of Company Stock allocated

to his Account shall be made in shares of Company Stock or in

cash as elected by the Participant or beneficiary pursuant to a

procedure established by the Committee.

               (d)  If a Participant or beneficiary fails to make

an election under Subsection (b), the value of his or her Account

shall be distributed as a single sum payment.

       .1   Beneficiary Designation.

               (a)  Except as provided in this Section, a

Participant may designate the beneficiary or beneficiaries who

shall receive, on or after his death, his interest in the Fund.

Such designation shall be made by executing and filing with the

Committee a written instrument in such form as may be prescribed

by the Committee for that purpose.  Except as provided in this

Section, the Participant may also revoke or change, at any time

and from time to time, any beneficiary designations previously

made.  Such revocations and/or changes shall be made by executing

and filing with the Committee a written instrument in such form

as may be prescribed by the Committee for that purpose.  If a

Participant names a trust as beneficiary, a change in the

identity of the trustees or in the instrument governing such

trust shall not be deemed a change in beneficiary.

               (b)  No designation, revocation, or change of

beneficiaries shall be valid and effective unless and until filed

with the Committee.

               (c)  A Participant who does not establish to the

satisfaction of the Committee that he has no spouse may not

designate someone other than his spouse to be his beneficiary

unless:

                    (1)  (A)  such spouse (or the spouse's legal

guardian if the spouse is legally incompetent) executes a written

instrument whereby such spouse consents not to receive such

benefit and consents either:

                              (i)  to the specific beneficiary or

beneficiaries designated by the Participant; or

                             (ii)  to the Participant's right to

designate any beneficiary without further consent by the spouse;

                         (B)  such instrument acknowledges the

effect of the election to which the spouse's consent is being

given; and

                         (C)  such instrument is witnessed by a

Plan representative or notary public;

                    (2)  the Participant:

                         (A)  establishes to the satisfaction of

the Committee that his spouse cannot be located; or

                         (B)  furnishes a court order to the

Committee establishing that the Participant is legally separated

or has been abandoned (within the meaning of local law), unless a

qualified domestic relations order pertaining to such Participant

provides that the spouse's consent must be obtained; or

                    (3)  the spouse has previously given consent

in accordance with this Subsection and consented to the

Participant's right to designate any beneficiary without further

consent by the spouse.

The consent of a spouse in accordance with this Subsection (c)

shall not be effective with respect to other spouses of the

Participant prior to the Participant's Benefit Commencement Date,

and an election to which Paragraph (2) of this Subsection (c)

applies shall become void if the circumstances causing the

consent of the spouse not to be required no longer exist prior to

the Participant's Benefit Commencement Date.

               (d)  If a Participant has no beneficiary under

Subsection (a) of this Section, if the Participant's

beneficiary(ies) predecease the Participant, or if the

beneficiary(ies) cannot be located by the Committee, the interest

of the deceased Participant shall be paid to the Participant's

estate.

       .1   Transfer of Account to Other Plan.

               (a)  Effective January 1, 1993, if (1) a

Participant entitled to receive a distribution from the Plan,

either pursuant to this Article or pursuant to Article VIII, or

(2) the spouse or former spouse of a Participant who is entitled

to receive a distribution from the Plan pursuant to a qualified

domestic relations order, directs the Committee to have the

Trustee transfer all or a portion (not less than $500) of the

amount to be distributed directly to:

                    (1)  an individual retirement account

described in section 408(a) of the Code,

                    (2)  an individual retirement annuity

described in section 408(b) of the Code (other than an endowment

contract),

                    (3)  a qualified defined contribution

retirement plan described in section 401(a) of the Code the terms

of which permit the acceptance of rollover contributions, or

                    (4)  an annuity plan described in section

403(a),

all or a portion (not less than $500) of the amount to be

distributed shall be so transferred.

               (b)  In addition, if a Participant's surviving

spouse is entitled to receive a distribution from the Plan under

Section 5.3, and such surviving spouse directs the Committee to

have the Trustee transfer all or a portion (not less than $500)

of the amount to be distributed directly to:

                    (1)  an individual retirement account

described in section 408(a) of the Code, or

                    (2)  an individual retirement annuity

described in section 408(b) of the Code (other than an endowment

contract),

all or a portion (not less than $500) of the amount to be

distributed shall be so transferred.

               (c)  The Participant, spouse or former spouse must

specify the name of the plan to which the Participant, spouse or

former spouse wishes to have the amount transferred, plus such

other information as may be requested by the Committee, on a form

and in a manner prescribed by the Committee.

               (d)  Subsections (a) and (b) shall not apply to

the following distributions:

                    (1)  any distribution of Voluntary

Contributions,

                    (2)  any distribution if the total

distributions paid or payable from the Plan to the same

individual during the same calendar year are reasonably expected

by the Committee to be less than $200,

                    (3)  that portion of any distribution after

the Participant's Required Beginning Date that is required to be

distributed to the Participant by the minimum distribution rules

of section 401(a)(9) of the Code, or

                    (4) such other distributions as may be

exempted by applicable statute or regulation from the

requirements of section 401(a)(31) of the Code.

               (e)  In the event a Participant, spouse or former

spouse fails to specify whether or not all or a portion of the

amount to be distributed should be transferred under this

Section, the amount to be distributed shall be paid to such

Participant, spouse or former spouse.

      .1   Sale of Company Stock Upon Distribution.

               (a)  If a Participant or beneficiary is entitled

to receive a distribution in cash, the Trustee shall (1) purchase

the Participant's or beneficiary's shares of Company Stock at

their fair market value, on the day they are to be delivered, for

the Fund by applying cash not then invested in Company stock, or

(2) effective prior to June 17, 1992, sell such shares on the

over-the-counter market and, effective after June 16, 1992, sell

such shares on the New York Stock Exchange or (3) both.

               (b)  Before any distribution of a Participant's

Account is made pursuant to this Article, any fractional share of

Company Stock allocated to such Account shall be converted to

cash, on the basis of its pro rata share of the price of a whole

share of Company Stock on the Quarterly Status Date coincident

with or next preceding the date of the distribution.

               (c)  Any shares of Company Stock distributed

pursuant to the terms of the Plan shall be subject to such

restrictions on their subsequent transfer as shall be necessary

or appropriate, in the opinion of counsel for the Company and the

Fund, to comply with applicable federal and state securities laws

and may bear appropriate legends evidencing such restrictions.

                           ARTICLE VI

                            VESTING

       .9   Nonforfeitable Amounts.  A Participant shall have a 100%

nonforfeitable interest at all times in his entire Account.

                          ARTICLE VII

              PURCHASE AND VOTING OF COMPANY STOCK

       .1   Purchase of Company Stock.  As soon as practicable following

the close of each month, the Trustee shall place an order with a

broker to purchase, effective prior to June 17, 1992, on the

over-the-counter market, and effective after June 16, 1992, on

the New York Stock Exchange, at prevailing fair market prices, as

many full shares of Company Stock as may be purchased with the

sum of the contributions allocated to the Participants' Accounts

which are to be invested in Company Stock pursuant to Article

XII, less any amount required to meet current expenses of the

Plan, unless, at the Company's direction, such expenses are paid

by one or more of the Participating Companies.  Any cash

remaining after completion of each purchase shall be held by the

Trustee for future purchases.  Purchases shall be made in the

name of the Trustee for the account of the Plan.  Certificates

for shares of Company Stock shall be issued in the Trustee's name

or in the name of the Trustee's nominee, and shall be delivered

to and held by the Trustee or by a recognized depository.

       .2   Participant Voting Direction.  The Trustee shall vote all

shares of Company Stock, including fractional shares, allocated

to a Participant's Account, in the manner directed by the

Participant to whose Account those shares are allocated.

       .3   Voting Procedures.  The Committee shall establish and

maintain a procedure by which Participants shall be timely

notified of their right to direct the voting of Company Stock

allocated to their Account and the manner in which any such

directions are to be conveyed to the Trustee.

       .4   Absence of Participant Voting Direction.  In the absence of

specific instructions from a Participant, the Trustee may vote

Company Stock in its sole discretion, provided that the Trustee

shall not tender Company Stock pursuant to any offering for such

Company Stock unless specifically directed to do so by the

Participant to whose Account the Company Stock is allocated.

                          ARTICLE VIII

                           WITHDRAWALS

       .10  Withdrawals Not Subject to Section 401(k) Restrictions.

               (a)  An Employee or Participant may withdraw, not

more than once during any Plan Year, up to the total value of the

amount in the following Accounts:

                    (1)  his Voluntary Contribution Account; and

                    (2)  his Rollover Account.

               (b)  Withdrawals under this Section shall be

charged against a Participant's Accounts in the following order

of priority:

                    (1)  (A)  the portion of the Participant's

Rollover Account, if any, that consists of the Participant's

employee contributions made before January 1, 1987, if any, less

any amounts previously withdrawn therefrom;

                         (B)  the balance of the Participant's

Rollover Account after the application of Subparagraph (A) of

this Paragraph, if any, less any amounts previously withdrawn

therefrom;

                    (2)  the Participant's Voluntary Contribution

Account, less any amounts previously withdrawn therefrom.

       .11  Withdrawals Subject to Section 401(k) Restrictions.

               (a)  A Participant may withdraw, not more than

once during any Plan Year, under the rules set forth in

Subsections (b) through (e) of this Section, the following

amounts:

                    (1)  his Salary Reduction Account as of

December 31, 1988; plus

                    (2)  the sum of his Salary Reduction

Contributions made after December 31, 1988.

               (b)  A withdrawal under Subsection (a) of this

Section shall be permitted only if the Committee finds that:

                    (1)  it is made on account of immediate and

heavy financial need (as defined in Subsection (c) of this

Section) of the Participant; and

                    (2)  it is necessary (as defined in

Subsection (d) of this Section) to satisfy such immediate and

heavy financial need.

               (c)  A withdrawal under Subsection (a) will be

deemed to be on account of an immediate and heavy financial need

if the Participant requests such withdrawal on account of:

                    (1)  expenses for medical care described in

section 213(d) of the Code and previously incurred by the

Participant, his spouse, or any of the Participant's dependents

(as defined in section 152 of the Code) or necessary for such

individuals to obtain such medical care;

                    (2)  costs directly related to the purchase

(excluding mortgage payments) of a principal residence of the

Participant;

                    (3)  the payment of tuition and related

educational fees for the next 12 months of post-secondary

education for the Participant, his spouse, children, or

dependents (as defined in section 152 of the Code);

                    (4)  the need to prevent the eviction of the

Participant from his principal residence or foreclosure on the

mortgage of his principal residence; or

                    (5)  such other circumstances or events as

may be prescribed by the Secretary of the Treasury or his

delegate.

               (d)  A withdrawal under Subsection (a) shall be

deemed to be necessary if:

                    (1)  the amount of the withdrawal does not

exceed the amount of the Participant's immediate and heavy

financial need, including any amounts necessary to pay any

federal, state or local income taxes or penalties reasonably

anticipated to result from the withdrawal;

                    (2)  the Participant has obtained all

currently permissible distributions (other than hardship

distributions) and non-taxable loans, if any, under this and all

other plans maintained by the Participating Company and all

Affiliated Companies; and

                    (3)  the Participant agrees in writing to be

bound by the rules of Subsection (e).

               (e)  If a Participant withdraws any amount from

his Salary Reduction Account pursuant to Subsection (a), or

withdraws any elective deferrals under any other qualified

retirement plan maintained by the Participating Company or any

Affiliated Company, which other plan conditions such withdrawal

upon the Participant's being subject to rules similar to those

stated in this Subsection and Subsection (d), such Participant:

                    (1)  may not make Salary Reduction

Contributions under this Plan or employee contributions (other

than mandatory contributions under a defined benefit plan) or

elective deferrals under any other qualified or non-qualified

plan of deferred compensation (which does not include any health

or welfare plan, including a health or welfare plan that is part

of a cafeteria plan described in section 125 of the Code)

maintained by the Participating Company or an Affiliated Company

for a period of 12 months commencing on the date of his receipt

of the withdrawal; and

                    (2)  in the calendar year next following the

calendar year of such withdrawal, may not make Salary Reduction

Contributions or elective deferrals under any other qualified

retirement plan maintained by the Participating Company or an

Affiliated Company in excess of:

                         (A)  the dollar amount described in

Subsection (b) of Section 3.1 for such year, minus

                         (B)  the total Salary Reduction

Contributions under this Plan and elective deferrals under any

other qualified plan made by the Participant during the calendar

year of the withdrawal.

       .1   Withdrawals On and After Attainment of Age 59-1/2.  Upon his

attainment of Age 59-1/2, a Participant may withdraw, up to the

total value in his Account, less amounts previously withdrawn

therefrom, by submitting his written request to the Committee.

       .2   Amount and Payment of Withdrawals.  The amount of any

withdrawal will be determined on the basis of the value of the

Participant's Account and the sum of the Participant's Salary

Reduction Contributions valued as of the Valuation Date

coincident with or immediately preceding the date of the

withdrawal.  Payment will be made in cash in a single sum.  If,

in order to make such a cash payment, the Trustee is required to

convert any portion of the Company Stock allocated to a

Participant's Account to cash, the Trustee shall comply with the

procedures set forth in Section 5.10.  Any withdrawal requested

under this Section shall be paid as soon as practicable following

the Committee's determination that the requested withdrawal

complies with the terms and conditions set forth in this Section.

       .3   Pledged Amounts.  No amount that has been pledged as

security for a loan under Article IX may be withdrawn under this

Article.

       .4   Investment Medium to be Charged with Withdrawal.

               (a)  Prior to July 1, 1991, a withdrawal made

pursuant to this Article shall be charged against a Participant's

interest in the various Investment Media in proportion to his

share in such Investment Media.

               (b)  Effective after June 30, 1991 and before

March 1, 1995, except with respect to a Participant's interest in

the Fixed Income Fund, a Participant may specify, in increments

of 25%, to which Investment Medium or Investment Media any

withdrawal under this Article is to be charged.  Unless so

specified, distribution will be made out of the Participant's

interest in the various Investment Media in proportion to the

Participant's share in such Investment Media.

               (c)  Effective after February 28, 1995, a

withdrawal made pursuant to this Article shall be charged against

a Participant's interest in the various Investment Media in

proportion to his share in such Investment Media.

                           ARTICLE IX

                     LOANS TO PARTICIPANTS

       .1   Loan Application.  Each Participant who is an Employee of a

Participating Company may apply for a loan from the Plan.  All

applications shall be made to the Committee on forms which it

prescribes, and the Committee shall rule upon such applications

in a uniform and nondiscriminatory manner in accordance with the

rules and guidelines established in this Article.

       .2   Loan Approval.  A loan shall be made effective as soon as

administratively possible after the date a Participant's loan

request is approved by the Committee.  No more than one

application by a Participant for a loan shall be approved during

any calendar year.

       .3   Amount of Loan.

               (a)  In no event shall a Participant be permitted

to have more than one loan outstanding at any time from this

Plan.  Effective prior to March 1, 1990, the minimum amount of

any loan shall be $500.  Effective after February 28, 1990, the

minimum loan amount shall be $1,000.  In no event shall the loan

amount exceed 50 percent (50%) of the value of the Participant's

Account, to a maximum of $50,000, determined as of the Valuation

Date immediately preceding the date on which the loan application

is received by the Committee; provided however, that the loan

amount shall not exceed the total value of the Participant's

Salary Reduction Account plus the value of his Voluntary

Contribution Account.

               (b)  The amount of any loan, when added to the

amount of a Participant's outstanding loans under the Plan and

all other plans qualified under section 401(a) of the Code which

are sponsored by the Participating Company or any Affiliated

Company shall not exceed the lesser of:

                    (1)  $50,000, reduced by the excess (if any)

of:

                         (A)  the Participant's highest

outstanding balance of loans during the one-year period ending on

the day before the date on which such loan is made to the

Participant, over

                         (B)  the outstanding balance of loans

made to the Participant on the date such loan is made to the

Participant; or

                    (2)  fifty percent (50%) of the value of the

Participant's Account.

               (c)  Loan distributions shall be made in cash.

The Trustee shall follow the procedures provided in Section 5.10

to the extent necessary to convert shares of Company Stock to

cash.

       .12  Terms of Loan.

               (a)  Effective prior to March 1, 1995, the

interest rate on loans shall be equal to the Trustee bank's fixed

rate for direct unsecured loans as of the date of the loan

application.  Effective after February 28, 1995, the interest

rate on loans shall be equal to the prime rate plus one percent

(1%) as of the date of the loan application.  Security for each

loan granted pursuant to this Article shall be, to the extent

necessary, the currently unpledged portion of, first, the

Participant's Voluntary Contribution Account, next, the

Participant's Rollover Account, and, next, the Participant's

Salary Reduction Account.  In no event shall more than fifty

percent (50%) of the Participant's vested Account as of the date

the loan is made be used as security for the loan.  In its sole

discretion, the Committee may require such additional security as

it deems necessary.

               (b)  Each loan shall be evidenced by the

Participant's execution of a personal demand note on such form as

shall be supplied by the Committee.  Each such note shall specify

that, to the extent repayment is not demanded sooner, repayment

shall be included in installments over 12, 24, 36, 48, or 60

months from the date on which the loan is distributed; however,

if the purpose of the loan is to acquire any dwelling unit which

is to be used within a reasonable period of time as the principal

residence of the Participant, the period of repayment may be as

long as, but shall not exceed, 180 months.  All loans from the

Plan shall be non-renewable.  Each note shall also specify the

interest rate as determined by the Committee at the time the loan

is approved.

               (c)  All loans shall be repaid in approximately

equal installments (not less frequently than quarterly) through

payroll deductions or in such other manner as the Committee may

determine.  A Participant may repay the outstanding balance of

any loan in one lump sum at any time by notifying the Committee

of his intent to do so and by forwarding to the Committee payment

in full of the then outstanding balance, plus interest accrued to

the date of payment; provided that a Participant who makes such a

lump sum payment may not apply for another loan from the Plan

until 12 months from the date of his lump sum payment.  The

amount of principal and interest repaid by a Participant shall be

credited to a Participant's Account as each repayment is made.

               (d)  If, and only if:

                    (1)  the Participant dies;

                    (2)  the Participant (other than a

Participant who continues to be a party in interest) has a

Separation from Service;

                    (3)  the Compensation of a Participant who is

an Employee of a Participating Company is discontinued or

decreased below the amount necessary to amortize the loan;

                    (4)  the loan is not repaid by the time the

note matures;

                    (5)  the Participant attempts to revoke any

payroll deduction authorization for repayment of the loan without

the consent of the Committee;

                    (6)  the Participant fails to pay any

installment of the loan when due and the Committee elects to

treat such failure as default;

                    (7)  any other event occurs which the

Committee, in its sole discretion, believes may jeopardize the

repayment of the loan;

before a loan is repaid in full, the unpaid balance thereof, with

interest due thereon, shall become immediately due and payable.

The Participant (or his beneficiary, in the event of the

Participant's death) may satisfy the loan by paying the

outstanding balance of the loan within such time as may be

specified in the note.  If the loan and interest are not repaid

within the time specified, the Committee shall satisfy the

indebtedness from the amount of the Participant's vested interest

in his Account as provided in Section 9.5 before making any

payments otherwise due hereunder to the Participant or his

beneficiary.

       .13  Enforcement.  The Committee shall give written notice to the

Participant (or his beneficiary in the event of the Participant's

death) of an event of default described in Subsection (d) of

Section 9.4.  If the loan and interest are not paid within the

time period specified in the notice, the amount of the

Participant's Voluntary Contribution Account, to the extent such

Account is security for the loan, shall be reduced by the amount

of the unpaid balance of the loan, with interest due thereon, and

the Participant's indebtedness shall thereupon be discharged to

the extent of the reduction.  In addition, if the value of the

Participant's Voluntary Contribution Account pledged as security

for the loan is insufficient to discharge fully the Participant's

indebtedness, the Participant's Salary Reduction Account shall be

used to reduce the Participant's indebtedness at such time as the

Participant is entitled to a distribution under Article V or a

withdrawal under Article VIII from his Salary Reduction Account.

Such action shall not operate as a waiver of the rights of the

Company, the Committee, the Trustee, or the Plan under applicable

law.  The Committee also shall be entitled to take any and all

other actions necessary and appropriate to foreclose upon any

property other than the Participant's Account pledged as security

for the loan or to otherwise enforce collection of the

outstanding balance of the loan.

       .14  Investment Medium to be charged with Loan.

               (a)  Prior to July 1, 1991, a loan made pursuant

to this Article shall be charged against a Participant's interest

in the various Investment Media in proportion to his share in

such Investment Media.

               (b)  Effective after June 30, 1991 and before

March 1, 1995, except with respect to a Participant's interest in

the Fixed Income Fund, a Participant may specify, in increments

of 25%, to which Investment Medium or Investment Media any loan

under this Article is to be charged.  Unless so specified,

distribution will be made out of the Participant's interest in

the various Investment Media in proportion to the Participant's

share in such Investment Media.  At the time a Participant

applies for a loan from the Plan, he shall elect the Investment

Media into which the amount of his loan repayments shall be

deposited.  Such election shall be irrevocable.

               (c)  Effective after February 28, 1995, a loan

made pursuant to this Article shall be charged against a

Participant's interest in the various Investment Media in

proportion to his share in such Investment Media.

       .15  Additional Rules.  The Committee may establish additional

rules relating to Participant loans under the Plan, which rules

shall be applied on a uniform and non-discriminatory basis.

                           ARTICLE X

                         ADMINISTRATION

      .16  Committee.  If the Company designates one or more

individuals as the Committee, the powers and duties of the

Committee under the Plan shall be exercised by the Committee;

otherwise all such powers and duties shall be exercised by the

Company.  The Committee shall be the named fiduciary which shall

control and manage the operation of the Plan and shall administer

the Plan.  The Committee members may, but need not, be Employees,

and they shall serve at the pleasure of the Company.  They shall

be entitled to reimbursement of expenses, but those members of

the Committee who are also Employees of a Participating Company

shall receive no compensation for their service on the Committee.

Any reimbursement of expenses of the Committee members shall be

paid directly by the Company.  The Committee shall be responsible

for the general administration of the Plan under the policy

guidance of the Company.

      .17  Duties and Powers of Committee.  In addition to the duties

and powers described elsewhere hereunder, the Committee shall

have the following specific duties and powers:

               (a)  to retain such consultants, accountants and

attorneys as may be deemed necessary or desirable to render

statements, reports, and advice with respect to the Plan and to

assist the Committee in complying with all applicable rules and

regulations affecting the Plan; any consultants, accountants and

attorneys may be the same as those retained by the Company;

               (b)  to decide appeals under this Article;

               (c)  to enact uniform and nondiscriminatory rules

and regulations to carry out the provisions of the Plan;

               (d)  to resolve questions or disputes relating to

eligibility for benefits or the amount of benefits under the

Plan;

               (e)  to construe and interpret and supply

omissions with respect to the provisions of the Plan;

               (f)  to determine whether any domestic relations

order received by the Plan is a qualified domestic relations

order as provided in section 414(p) of the Code;

               (g)  to evaluate administrative procedures; and

               (h)  to delegate such duties and powers as the

Committee shall determine from time to time to any person or

persons.  To the extent of any such delegation, the delegate

shall have the duties, powers, authority and discretion of the

Committee.

Any decisions and determinations made by the Committee pursuant

to its duties and powers described in the Plan shall be

conclusive and binding upon all parties.  The Committee shall

have sole discretion in carrying out its responsibilities.  The

expenses incurred by the Committee in connection with the

operation of the Plan, including, but not limited to, the

expenses incurred by reason of the engagement of professional

assistants and consultants, shall be expenses of the Plan and

shall be payable from the Fund at the direction of the Committee.

The Participating Companies shall have the option, but not the

obligation, to pay any such expenses, in whole or in part, and,

by so doing, to relieve the Fund from the obligation of bearing

such expenses.  Payment of any such expenses by a Participating

Company on one occasion shall not bind that Participating Company

to pay any similar expenses on any subsequent occasion.

      .18  Functioning of Committee.  The Committee and those persons

or entities to whom the Committee has delegated responsibilities

shall keep accurate records and minutes of meetings,

interpretations, and decisions.  The Committee shall act by

majority vote of the members, and such action shall be evidenced

by a written document.

      .19  Disputes.

               (a)  If the Committee denies, in whole or in part,

a claim for benefits by a Participant or his beneficiary, the

Committee shall furnish notice of the denial to the claimant,

setting forth:

                    (1)  the specific reasons for the denial;

                    (2)  specific reference to the pertinent Plan

provisions on which the denial is based;

                    (3)  a description of any additional

information necessary for the claimant to perfect the claim and

an explanation of why such information is necessary; and

                    (4)  appropriate information as to the steps

to be taken if the claimant wishes to submit his claim for

review.

Such notice shall be forwarded to the claimant within 90 days of

the Committee's receipt of the claim; provided, however, that in

special circumstances the Committee may extend the response

period for up to an additional 90 days, in which event it shall

notify the claimant in writing of the extension, and shall

specify the reason or reasons for the extension.

               (b)  Within 60 days of receipt of a notice of

claim denial, a claimant or his duly authorized representative

may petition the Committee in writing for a full and fair review

of the denial.  The claimant or his duly authorized

representative shall have the opportunity to review pertinent

documents and to submit issues and comments in writing to the

Committee.  The Committee shall review the denial and shall

communicate its decision and the reasons therefor to the claimant

in writing within 60 days of receipt of the petition; provided,

however, that in special circumstances the Committee may extend

the response period for up to an additional 60 days, in which

event it shall notify the claimant in writing prior to the

commencement of the extension.  The appeals procedure set forth

in this Subsection (b) shall be the exclusive means for

contesting a decision denying benefits under the Plan.

      .20  Indemnification.  Each member of the Committee, and any

other person who is an Employee or director of a Participating

Company or an Affiliated Company shall be indemnified and held

harmless by the Company against and with respect to all damages,

losses, obligations, liabilities, liens, deficiencies, costs and

expenses, including without limitation, reasonable attorney's

fees and other costs incident to any suit, action, investigation,

claim or proceedings to which he may be a party by reason of his

performance of administrative functions and duties under the

Plan.  The foregoing right to indemnification shall be in

addition to such other rights as the Committee member or other

person may enjoy as a matter of law or by reason of insurance

coverage of any kind.  Rights granted hereunder shall be in

addition to and not in lieu of any rights to indemnification to

which the Committee member or other person may be entitled

pursuant to the by-laws of the Participating Company.

                           ARTICLE XI

                            THE FUND

      .1   Designation of Trustee.  The Company, by appropriate

resolution of its Board of Directors, if any, shall name and

designate a Trustee and shall enter into a Trust Agreement.  The

Company shall have the power, by appropriate resolution of its

Board of Directors, to amend the Trust Agreement, remove the

Trustee, and designate a successor Trustee, as provided in the

Trust Agreement.  All of the assets of the Plan shall be held by

the Trustee for use in accordance with the Plan.

      .2   Exclusive Benefit.  Prior to the satisfaction of all

liabilities under the Plan in the event of termination of the

Plan, no part of the corpus or income of the Fund shall be used

for or diverted to purposes other than for the exclusive benefit

of Participants and their beneficiaries except as expressly

provided in this Plan and in the Trust Agreement.

      .3   No Interest in Fund.  No person shall have any interest in

or right to any part of the assets or income of the Fund, except

to the extent expressly provided in this Plan and in the Trust

Agreement.

      .4   Trustee.  The Trustee shall be the named fiduciary with

respect to management and control of Plan assets held by it and,

except as provided in Article XII, shall have exclusive and sole

responsibility for the custody and investment thereof in

accordance with the Trust Agreement.

                          ARTICLE XII

                          INVESTMENTS

      .21  Investment of Pre-1994 Matching Contributions, Voluntary

Contributions, Pre-1990 Salary Reduction Contributions and

Pre-1990 Rollover Contributions.

               (a)  All Pre-1994 Matching Contributions,

Voluntary Contributions, Pre-1990 Salary Reduction Contributions

and Pre-1990 Rollover Contributions allocated to a Participant's

Account shall be invested in Company Stock.  Notwithstanding the

foregoing, a Participant who attains Age 55 may, not more than

once during any Plan Year, direct the Trustee to sell a portion

of the Age 55 Shares allocated to his Voluntary Contribution

Account, Pre-1994 Matching Contribution Subaccount, Pre-1990

Salary Reduction Subaccount and Pre-1990 Rollover Subaccount and

transfer the proceeds to any other Investment Medium selected by

the Participant.  The portion transferred shall be expressed in

whole percentages of his Age 55 Shares and shall be transferred

in equal portions from his Pre-1994 Matching Contribution

Subaccount, Voluntary Contribution Account, Pre-1990 Salary

Reduction Subaccount and Pre-1990 Rollover Subaccount.  The

cumulative number of Age 55 Shares transferred shall not exceed

the following percentages during the Plan Years in which the

Participant attains the following ages:

               Age Attained             Percentage of
               in Plan Year             Age 55 Shares

                    55                       40%

                    56                       60%

                    57                       80%

                    58                      100%

               (b)  Prior to March 1, 1995, a direction to the

Trustee pursuant to Subsection (a) of this Section shall be

effective as of any Quarterly Status Date if made in writing at

least 15 days prior to such Quarterly Status Date, and the

Trustee shall sell the affected Company Stock and transfer the

proceeds as of such Quarterly Status Date.  After

February 28, 1995, such investment direction may be made on any

day of any calendar month and shall become effective as soon as

administratively possible after receipt of the direction by the

Committee, in accordance with rules established by the Committee

for this purpose.

               (c)  Effective as of any Payroll Period beginning

after a Participant attains Age 55, a Participant may elect, in

the manner prescribed by the Committee, to have any portion of

Pre-1990 Salary Reduction Contributions and Pre-1994 Matching

Contributions that will be allocated to his Account after he

attains Age 55 invested in any other Investment Medium selected

by the Participant.  Such an election shall be irrevocable.

               (d)  Notwithstanding Subsections (a) - (c) of this

Section, effective on each June 1, September 1, January 1 and

March 1, commencing on June 1, 1990 and ending on

September 1, 1994, a Participant may elect to transfer up to 20%

of the value of the Company Stock allocated to his Voluntary

Contribution Account, Pre-1990 Salary Reduction Subaccount and

Pre-1990 Rollover Subaccount to any Investment Medium selected by

the Participant; provided, that, such election is made at least

15 days prior to the effective date of the transfer and no more

than one transfer may be made in any Plan Year.  The Company

Stock remaining in a Participant's Voluntary Contribution

Account, Pre-1990 Salary Reduction Subaccount and Pre-1990

Rollover Subaccount after August 31, 1994 may not be transferred

to any other Investment Medium until the Participant attains Age

55 and makes a transfer of Age 55 Shares pursuant to Subsection

(a) of this Section 12.1.

               (e)  A Participant may elect to invest Pre-1994

Matching Contributions allocated to his Account after

February 28, 1993 in Company common or preferred stock, as

provided in Subsection (b) of Section 3.4.

      .22  Investment of Post-1989 Salary Reduction Contributions,

Post-1989 Rollover Contributions and Post-1993 Matching

Contributions.

               (a)  The Trustee shall invest Post-1989 Salary

Reduction Contributions, Post-1989 Rollover Contributions and

Post-1993 Matching Contributions paid to it and income thereon in

such Investment Media as each Participant may select in

accordance with this Section.  Such investments acquired in the

manner prescribed by the Plan shall be held by or for the

Trustee.  Prior to March 1, 1995, a Participant may select the

Investment Media in which his Post-1989 Salary Reduction

Contributions, Post-1989 Rollover Contributions and Post-1993

Matching Contributions shall be deposited, effective on any

September 1, December 1, March 1 or June 1; provided, that, the

Committee receives notice of such investment selection by the

fifteenth day of the month prior to the effective date of the

selection.  Effective after February 28, 1995, a Participant may

select the Investment Media in which his Post-1989 Salary

Reduction Contributions, Post-1989 Rollover Contributions and

Post-1993 Matching Contributions shall be deposited on any day of

any calendar month, provided that a Participant may make only one

selection in any calendar month.  Such selection shall be

effective as soon as administratively possible after receipt of

notice of the selection by the Committee.

               (b)  A Participant shall select one or more of the

Investment Media in which his Account shall be invested, and the

percentage thereof, that shall be invested in each Investment

Medium selected, provided that prior to March 1, 1995, such

percentage shall be selected in multiples of 25%.  In the event a

Participant fails to make an election pursuant to this Section,

amounts allocated to his Account shall be invested in the most

conservative of the Investment Media as determined by the

Committee.  A Participant may amend such selection by prior

notice to the Committee, effective as of such dates determined by

the Committee, by giving prior notice to the Committee.  Such

amendments will be subject to the other requirements of this

Section.

               (c)  Prior to March 1, 1995, a Participant may

transfer such portion of the value of his existing interest in

any Investment Medium to another Investment Medium effective on

any Quarterly Status Date, provided that the Committee receives

notice of such transfer by the fifteenth day of the month prior

to the Quarterly Status Date.

               (d)  After February 28, 1995, a Participant may

transfer such portion of the value of his existing interest in

any Investment Medium to another Investment Medium effective on

any day of any calendar month, provided that a Participant may

make only one such transfer in a calendar month.

      .23  Investment Media.  Prior to March 1, 1990, the only

Investment Media available under the Plan shall be (a) Company

Stock, and (b) the Fixed Income Fund in which only Age 55 Shares

may be invested.  After February 28, 1990, the Plan shall make

available such Investment Media as the Committee shall, from time

to time, determine and communicate to Participants.

      .24  Additional Rules.

               (a)  The amounts contributed by all Participants

to each Investment Medium shall be commingled for investment

purposes.

               (b)  The Trustee may hold assets of the Fund and

make distributions therefrom in the form of cash without

liability for interest, if for administrative purposes it becomes

necessary or practical to do so.

                          ARTICLE XIII

              AMENDMENT OR TERMINATION OF THE PLAN

      .25  Power of Amendment and Termination.

               (a)  It is the intention of each Participating

Company that this Plan will be permanent.  However, each

Participating Company reserves the right to terminate its

participation in this Plan at any time by or pursuant to action

of its board of directors or other governing body.  Furthermore,

the Company reserves the power to amend or terminate the Plan at

any time by or pursuant to action of the Board of Directors.

               (b)  Each amendment to the Plan shall be binding

on each Participating Company if such Participating Company, by

or pursuant to action of its board of directors or other

governing body:

                    (1)  consents to such amendment at any time;

or

                    (2)  fails to object thereto within thirty

days after receiving notice thereof.

               (c)  Any amendment or termination of the Plan

shall become effective as of the date designated by the Board of

Directors or its delegate.  Except as expressly provided

elsewhere in the Plan, prior to the satisfaction of all

liabilities with respect to the benefits provided under this

Plan, no amendment or termination shall cause any part of the

monies contributed hereunder to revert to the Participating

Companies or to be diverted to any purpose other than for the

exclusive benefit of Participants and their beneficiaries.  Upon

termination of the plan without establishment or maintenance of

another defined contribution plan (other than an employee stock

ownership plan as defined in section 4975(e)(7) of the Code or a

simplified employee pension plan as defined in section 408(k) of

the Code), Accounts shall be distributed in accordance with

applicable law.

      .26  Merger.  The Plan shall not be merged with or consolidated

with, nor shall its assets be transferred to, any other qualified

retirement plan unless each Participant would receive a benefit

after such merger, consolidation, or transfer (assuming the Plan

then terminated) which is of actuarial value equal to or greater

than the benefit he would have received from his Account if the

Plan had been terminated on the day before such merger,

consolidation, or transfer.  No amounts shall be transferred to

this Plan which would cause the Plan to be a direct or indirect

transferee of a plan to which the joint and survivor annuity and

pre-retirement survivor annuity requirements of sections

401(a)(11) and 417 of the Code apply.

                          ARTICLE XIV

                      TOP-HEAVY PROVISIONS

      .27  General.  The following provisions shall apply automatically

to the Plan and shall supersede any contrary provisions for each

Plan Year in which the Plan is a Top-Heavy Plan (as defined

below).  It is intended that this Article shall be construed in

accordance with the provisions of section 416 of the Code.

      .28  Definitions.  The following definitions shall supplement

those set forth in Article I of the Plan:

               (a)  "Aggregation Group" means this plan and each

other qualified retirement plan (including a frozen plan or a

plan which has been terminated during the 60-month period ending

on the Determination Date) of a Participating Company or an

Affiliated Company:

                    (1)  in which a Key Employee is a

participant; or

                    (2)  which enables any plan in which a Key

Employee participates to meet the requirements of sections

401(a)(4) or 410 of the Code; or

                    (3)  without the inclusion of which, the

plans in the Aggregation Group would be Top-Heavy Plans, but,

with the inclusion of which, the plans in the Aggregation Group

are not Top-Heavy Plans and, taken together, meet the

requirements of sections 401(a)(4) and 410 of the Code.

               (b)  "Determination Date" means, for any Plan

Year, the last day of the preceding Plan Year.

               (c)  "Key Employee" means, with respect to any

Plan Year:

                    (1)  any Employee or former Employee who at

any time during the 60-month period ending on the Determination

Date was:

                         (A)  an officer of a Participating

Company having Compensation for a Plan Year during such period

greater than fifty percent (50%) of the amount in effect under

section 415(b)(1)(A) of the Code for the calendar year in which

such Plan Year ends; provided, that no more than 50 Employees

(or, if less, the greater of three Employees or ten percent (10%)

of the greatest number of Employees employed by all Participating

Companies and all Affiliated Companies during such 60-month

period, but excluding employees described in section 414(q)(8) of

the Code) shall be treated as officers; or

                         (B)  one of the 10 Employees having

Compensation greater than the amount described in section

415(c)(1)(A) of the Code and owning (or are considered as owning,

within the meaning of section 318 of the Code) the largest

interests in any Participating Company or Affiliated Company,

provided that such interest exceeds one-half of one percent

(0.5%) of the total share ownership of the Participating Company

or Affiliated Company, the total number of individuals described

in this Subparagraph (B) being limited to 10 for the entire

60-month period; or

                         (C)  a five-percent (5%) owner of a

Participating Company; or

                         (D)  a one-percent (1%) owner of a

Participating Company having Compensation in excess of $150,000;

or

                    (2)  a beneficiary of an individual described

in Paragraph (1) of this Subsection.

For purposes of this Subsection, Compensation shall include

elective deferrals under sections 125, 402(a)(8), 402(h) and

403(b) of the Code.  Determinations under this Subsection shall

be made in accordance with section 416(i) of the Code.

               (d)  "Key Employee Ratio" means, for any

Determination Date, the ratio of the amount described in

Paragraph (1) of this Subsection to the amount described in

Paragraph (2) of this Subsection, after deducting from each such

amount any portion thereof described in Paragraph (3) of this

Subsection, where:

                    (1)  the amount described in this Paragraph

is the sum of:

                         (A)  the present value of all accrued

benefits of Key Employees under all qualified defined benefit

plans included in the Aggregation Group;

                         (B)   the balances in all of the

accounts of Key Employees under all qualified defined

contribution plans included in the Aggregation Group; and

                         (C)  the amounts distributed from all

plans in such Aggregation Group to or on behalf of any Key

Employee during the period of five Plan Years ending on the

Determination Date, except any benefit paid on account of death

to the extent it exceeds the accrued benefits or account balances

immediately prior to death;

                    (2)  the amount described in this Paragraph

is the sum of:

                         (A)  the present value of all accrued

benefits of all participants under all qualified defined benefit

plans included in the Aggregation Group;

                         (B)  the balances in all of the accounts

of all participants under all qualified defined contribution

plans included in the Aggregation Group; and

                         (C)  the amounts distributed from all

plans in such Aggregation Group to or on behalf of any

participant during the period of five Plan Years ending on the

Determination Date; and

                    (3)  the amount described in this Paragraph

is the sum of:

                         (A)  all rollover contributions (or fund

to fund transfers) to the Plan by an Employee after

December 31, 1983 from a plan sponsored by an employer which is

not a Participating Company or an Affiliated Company;

                         (B)  any amount that is included in

Paragraphs (1) and (2) of this Subsection for a person who is a

Non-Key Employee as to the Plan Year of reference but who was a

Key Employee as to any earlier Plan Year; and

                         (C)  for Plan Years beginning after

December 31, 1984, any amount that is included in Paragraphs (1)

and (2) of this Subsection for a person who has not performed any

services for any Participating Company during the five-year

period ending on the Determination Date.

The present value of accrued benefits under any defined benefit

plan shall be determined on the basis of the actuarial

assumptions used by such defined benefit plan under the method

used for accrual purposes for all plans maintained by all

Participating Companies and Affiliated Companies if a single

method is used by all such plans, or, otherwise, the slowest

accrual method permitted under section 411(b)(1)(C) of the Code.

               (e)  "Non-Key Employee" means, for any Plan Year:

                    (1)  an Employee or former Employee who is

not a Key Employee with respect to such Plan Year; or

                    (2)  a beneficiary of an individual described

in Paragraph (1) of this Subsection.

               (f)  "Super Top-Heavy Plan" means, for any Plan

Year, each plan in the Aggregation Group for such Plan Year if,

as of the applicable Determination Date, the Key Employee Ratio

exceeds ninety percent (90%).

               (g)  "Top-Heavy Compensation" means, for any

Participant for any Plan Year, the average of his annual

Compensation over the period of five consecutive Plan Years (or,

if shorter, the longest period of consecutive Plan Years during

which the Participant was in the employ of any Participating

Company) yielding the highest average, disregarding:

                    (1)  Compensation for Plan Years ending prior

to January 1, 1984; and

                    (2)  Compensation for Plan Years after the

close of the last Plan Year in which the Plan was a Top-Heavy

Plan.

               (h)  "Top-Heavy Plan" means, for any Plan Year,

each plan in the Aggregation Group for such Plan Year if, as of

the applicable Determination Date, the Key Employee Ratio exceeds

sixty percent (60%).

               (i)  "Year of Top-Heavy Service" means, for any

Participant, a Plan Year in which he completes 1,000 or more

Hours of Service, excluding:

                    (1)  Plan Years commencing prior to

January 1, 1984; and

                    (2)  Plan Years in which the Plan is not a

Top-Heavy Plan.

      .29  Minimum Contribution for Non-Key Employees.

               (a)  In each Plan Year in which the Plan is a

Top-Heavy Plan, each Eligible Employee who is a Non-Key Employee

(except an Eligible Employee who is a Non-Key Employee as to the

Plan Year of reference but who was a Key Employee as to any

earlier Plan Year) and who is an Employee on the last day of such

Plan Year will receive a total minimum Participating Company or

Affiliated Company contribution (including forfeitures) under all

plans described in Paragraphs (a)(1) and (a)(2) of Section 14.2

of not less than three percent (3%) of the Eligible Employee's

Compensation for the Plan Year.  Elective deferrals to such plans

made on behalf of a Participant in plan years beginning after

December 31, 1984 but before January 1, 1989 shall be deemed to

be Company contributions for the purpose of this Subsection.

Elective deferrals and employer matching contributions to such

plans in plan years beginning on or after January 1, 1989 shall

not be used to meet the minimum contribution requirements of this

Subsection.

               (b)  The percentage set forth in Subsection (a)

shall be reduced to the percentage at which contributions,

including forfeitures, are made (or are required to be made) for

a Plan Year for the Key Employee for whom such percentage is the

highest for that Plan Year.  This percentage shall be determined

for each Key Employee by dividing the contribution for such Key

Employee by his Compensation for the Plan Year.  All defined

contribution plans required to be included in an Aggregation

Group shall be treated as one plan for the purpose of this

Section; however, this Section shall not apply to any plan which

is required to be included in the Aggregation Group if such plan

enables a defined benefit plan in the group to meet the

requirements of section 401(a)(4) or section 410 of the Code.

               (c)  If a Non-Key Employee described in

Subsection (a) participates in both a defined benefit plan and a

defined contribution plan described in Paragraphs (a)(1) and

(a)(2) of Section 14.2, the Participating Company is not required

to provide such Employee with both the minimum benefit under the

defined benefit plan and the minimum contribution.  In such

event, the Non-Key Employee shall not receive the minimum

contribution described in this Section if he has the minimum

benefit required by section 416 of the Code under the defined

benefit Top-Heavy Plan.

      .30  Social Security.  The Plan, for each Plan Year in which it

is a Top-Heavy Plan, must meet the requirements of this Article

without regard to any Social Security or similar contributions or

benefits.

      .31  Adjustment to Maximum Benefit Limitation.

               (a)  For each Plan Year in which the Plan is (1) a

Super Top-Heavy Plan or (2) a Top-Heavy Plan and the Board of

Directors does not make the election to amend the Plan to provide

the minimum contribution described in Subsection (c), the 1.25

factor in the defined benefit and defined contribution fractions

described in Subsection (c) of Section 3.9 shall be reduced to

1.0.  The adjustment described in this Subsection shall not apply

to a Participant during any period in which the Participant earns

no additional accrued benefit under any defined benefit plan and

has no employer contributions, forfeitures, or voluntary

nondeductible contributions allocated to his accounts under any

defined contribution plan.

               (b)  In the case of any Top-Heavy Plan to which

Subsection (e) of Section 3.9 applies, "$41,500" shall be

substituted for "$51,875" in the calculation of the numerator of

the transition fraction.

               (c)  If, in any Plan Year in which the Plan is a

Top-Heavy Plan but not a Super Top-Heavy Plan, the Aggregation

Group also includes a defined benefit plan, the Board of

Directors may elect to use a factor of 1.25 in computing the

denominator of the defined benefit and defined contribution

fractions described in Section 3.9.  In the event of such

election, the minimum contribution described in Section 14.3(a)

for each Non-Key Employee who is not covered under a defined

benefit plan shall be increased to four percent (4%), and the

minimum Company contribution described in Section 14.3(c) for

each Non-Key Employee who is covered under a defined benefit plan

(but who does not have a minimum benefit under the defined

benefit plan equal to the lesser of (1) three percent (3%) of his

Top-Heavy Compensation multiplied by his Years of Top-Heavy

Service or (2) thirty-percent (30%) of his Top-Heavy

Compensation) shall be increased to seven and one-half percent

(7-1/2%).

                           ARTICLE XV

                     ROLLOVER CONTRIBUTIONS

      .32  Rollover Contributions.

               (a)  Subject to the restrictions set forth in

Subsection (b), a Covered Employee may transfer or have

transferred directly to the Fund, from any qualified retirement

plan of a former employer, all or a portion of his interest in

the distributing plan.  In addition, a Covered Employee who has

established an individual retirement account to hold

distributions received from qualified retirement plans of former

employers may transfer all of the assets of such individual

retirement account to the Fund.  Such individual retirement

account shall not contain nondeductible contributions made by the

Employee while he was a participant in such plans.

               (b)  The Trustee shall not accept a distribution

from any other qualified retirement plan or from an individual

retirement account unless the following conditions are met:

                    (1)  (A)  the distribution being transferred

must come directly from the fiduciary of the plan of the former

employer, or

                         (B)  it must come from the Employee

within 60 days after the Employee receives a distribution from

such other qualified retirement plan or individual retirement

account and must comply with the provisions of section 402(c),

403(a)(4), or 408(d)(3) of the Code, whichever applies;

                    (2)  distributions from a plan for a

self-employed person shall not be transferred to this Plan,

unless the transfer is directly to the Fund from the funding

agent of the distributing plan;

                    (3)  the interest being transferred shall not

include assets from any plan to the extent that the Committee

determines that the transfer of such interest (A) would impose

upon this Plan requirements as to form of distribution that would

not otherwise apply hereunder, (B) would otherwise result in the

elimination of Code section 411(d)(6) protected benefits, or (C)

would cause the Plan to be a direct or indirect transferee of a

plan to which the joint and survivor annuity requirements of

sections 401(a)(11) and 417 of the Code apply; and

                    (4)  the interest being transferred shall not

contain nondeductible contributions made to the distributing plan

by the Employee unless the transfer to the Fund is directly from

the funding agent of the distributing plan.

      .33  Vesting and Distribution of Rollover Account.

               (a)  The distributions transferred by or for a

Covered Employee from another qualified retirement plan or from

an individual retirement account shall be credited to the

Employee's Rollover Account.  An Employee shall be fully vested

at all times in his Rollover Account

               (b)  An Employee's Rollover Account shall be

distributed as otherwise provided under the Plan.

                          ARTICLE XVI

                       GENERAL PROVISIONS

      .1   No Employment Rights.  Neither the action of the Company in

establishing the Plan, nor of any Participating Company in

adopting the Plan, nor any provisions of the Plan, nor any action

taken by the Company, any Participating Company or the Committee

shall be construed as giving to any Employee the right to be

retained in the employ of the Company or any Participating

Company, or any right to payment except to the extent of the

benefits provided in the Plan to be paid from the Fund.

      .2   Governing Law.  Except to the extent superseded by ERISA,

all questions pertaining to the validity, construction, and

operation of the Plan shall be determined in accordance with the

laws of the state in which the principal place of business of the

Company is located.

      .3   Severability of Provisions.  If any provision of this Plan

is determined to be void by any court of competent jurisdiction,

the Plan shall continue to operate and, for the purposes of the

jurisdiction of that court only, shall be deemed not to include

the provisions determined to be void.

      .4   No Interest in Fund.  No person shall have any interest in,

or right to, any part of the principal or income of the Fund,

except as and to the extent expressly provided in this Plan and

in the Trust Agreement.

      .5   Spendthrift Clause.  No benefit payable at any time under

this Plan and no interest or expectancy herein shall be

anticipated, assigned, or alienated by any Participant or

beneficiary, or subject to attachment, garnishment, levy,

execution, or other legal or equitable process, except for (1) a

Federal tax levy made pursuant to section 6331 of the Code and

(2) any benefit payable pursuant to a qualified domestic

relations order.  Any attempt to alienate or assign a benefit

hereunder, whether currently or hereafter payable, shall be void.

      .6   Incapacity.  If the Committee deems any Participant who is

entitled to receive payments hereunder incapable of receiving or

disbursing the same by reason of Age, illness, infirmity, or

incapacity of any kind, the Committee may direct the Trustee to

apply such payments directly for the comfort, support, and

maintenance of such Participant, or to pay the same to any

responsible person caring for the Participant who is determined

by the Committee to be qualified to receive and disburse such

payments for the Participant's benefit; and the receipt of such

person shall be a complete acquittance for the payment of the

benefit.  Payments pursuant to this Section shall be complete

discharge to the extent thereof of any and all liability of the

Participating Companies, the Committee, the Trustee and the Fund.

      .7   Withholding.  The Committee and the Trustee the shall have

the right to withhold any and all state, local, and Federal taxes

which may be withheld in accordance with applicable law.

      .8   Missing Persons.  Neither the Trustee nor any Participating

Company shall be obliged to search for or ascertain the

whereabouts of any individual entitled to benefits under the

Plan.  Any individual entitled to benefits under the Plan who

does not file a timely claim for his benefits will be allowed to

file a claim at any later date, and payment of his benefits will

commence after that later date, except that, in the event the

Participating Company is satisfied that a Participant has no

spouse or that a Participant's spouse cannot be located (as

described in Section 5.8), and the Participant is in fact married

or the spouse is later located, whichever is applicable, such

spouse shall not be deemed an individual entitled to benefits

under the Plan.

          Executed this ____ day of _________________, 1996.

                                   WESTMORELAND COAL COMPANY

[SEAL]                             By:___________________________
                                        [Title]

Attest:________________________
               Secretary
                                   WESTMORELAND RESOURCES, INC.

[SEAL]                             By:___________________________
                                        [Title]

Attest:________________________
               Secretary
AMENDMENT  NO. 1
                             TO THE
                  WESTMORELAND COAL COMPANY AND
     AFFILIATED COMPANIES EMPLOYEES SAVINGS/RETIREMENT PLAN
                                
                                
              Resolutions of the Board of Directors
                  of Westmoreland Coal Company
                                
     WHEREAS, Westmoreland Coal Company (the "Company") adopted

the Westmoreland Coal Company and Affiliated Companies Employees'

Stock Purchase Plan, Effective October 1, 1957, and renamed such

plan the Westmoreland coal Company and  Affiliated Companies

Employees' Savings/Retirement Plan ( the "Plan"), effective March

1, 1990; and

     WHEREAS,  the Plan has been amended from time  to time and

was most recently amended and restated effective September 1,

1987; and

     WHEREAS, Westmoreland Energy, Inc. is a Participating

Company under the Plan; and

     WHEREAS, Westmoreland Energy, Inc. acquired the Corona

Engineering and Consulting Division of OESI  Power Corporation,

effective October 1, 1995; and

     WHEREAS, the Company desires to amend the Plan to provide

for the participation of employees of the Corona Engineering and

Consulting Division of OESI Power Corporation who, as a result of

the acquisition, became employees of the Corona

Division of Westmoreland Energy, Inc. on October 1, 1995;

     NOW, THEREFORE, BE IT RESOLVED, that effective October 1,

1995, the Plan is amended to read as follows:

     1.   The following definition shall be added to Article I of
the Plan:
          ""Corona Participant" means any Participant who was an
          employee of the Corona Engineering and Consulting
          Division of OESI Power Corporation on September 30,
          1995 and became an employee of the Corona Division of
          Westmoreland Energy, Inc. on October 1, 1995."

     2.   The following Paragraph (3) shall be added to the end
of Section 3.4 (a) of the Plan:

     "(3) Notwithstanding Paragraph (2) of this Section 3.4 (a),
effective October 1,     1995, a Participating Company shall
contribute to the Fund for each Plan year an      amount equal to
100% of Corona Participants' Salary Reduction Contributions for
such Plan Year not in excess of seven percent (7%) of each Corona
Participant's  Compensation, offset by the amount, if any, of
Matching Contributions forfeited   during such Plan Year,
provided that such contributions may be prospectively  limited as
provieded in Section 3.8 and provided further that the
contribution   under this Section for any Plan year shall not
cause the  total contributions by the   Participating Company to
exceed the maximum allowable current deduction    Matching
contributions shall be credited to the Participants in proportion
to their  Salary    Reduction contributions for the Plan Year not
in Employee's  Compensation."

     3.   The following Subsection (e) shall be added to the end
of Section 2.2 of the Plan:

     "(e)  Notwithstanding any provision of the Plan to the
contrary, each Covered   Employee who was an employee of the
Corona Engineering  and  Consulting     Division of OESI Power
Corporation on September 30, 1995 and became an   employee of the
Corona  Division of Westmoreland Energy, Inc. on October 1,
1995 shall be credited with Hours of Service for purposes of
Subsection (b) of this   Section by taking into account his
service with the Corona Engineering and      Consulting Division
of OESI Power Corporation prior to October 1, 1995."