Document:

<PAGE>

                                                                    Exhibit 10.3

                           CONTRIBUTION, CONVEYANCE
                           AND ASSUMPTION AGREEMENT
                           ------------------------

         This Contribution, Conveyance and Assumption Agreement (this
"Agreement") dated effective as of 12:01 a.m. Eastern Standard Time on September
 ----------
14, 2001 (the "Effective Time"), is entered into by and among PENN VIRGINIA COAL
               --------------
COMPANY, a Virginia corporation ("PVCC"), PENN VIRGINIA OPERATING CO., LLC, a
                                  ----
Delaware limited liability company ("PVOC"), PENN VIRGINIA OIL & GAS
                                     ----
CORPORATION, a Virginia corporation ("PVOG"), PENN VIRGINIA HOLDING CORP., a
                                      ----
Delaware corporation ("Holding"), PENN VIRGINIA RESOURCE HOLDINGS CORP., a
                       -------
Delaware corporation ("Resource Holdings"), PENN VIRGINIA RESOURCE PARTNERS,
                       -----------------
L.P., a Delaware limited partnership (the "MLP"), PENN VIRGINIA RESOURCE GP,
                                           ---
LLC, a Delaware limited liability company ("GP LLC"), PENN VIRGINIA RESOURCE GP,
                                            ------
CORP., a Delaware corporation ("GP Corp"), PENN VIRGINIA RESOURCE LP, CORP., a
                                -------
Delaware corporation ("LP Corp"), WISE ENVIRONMENTAL TECHNOLOGIES, INC., a
                       -------
Virginia corporation ("Wise"), WISE LLC, a Delaware limited liability company
                       ----
("Wise LLC"), PARAGON COAL CORPORATION, a Virginia corporation ("PCC"), LOADOUT
  --------                                                       ---
LLC, a Delaware limited liability company ("Loadout LLC"), KANAWHA RAIL CORP., a
                                            -----------
Virginia corporation ("KRC"), and K RAIL LLC, a Delaware limited liability
                       ---
company ("K Rail LLC").
          ----------

                                   RECITALS
                                   --------

         WHEREAS, the MLP has been formed pursuant to the Delaware Revised
Uniform Limited Partnership Act (the "Delaware Act"), for the purpose of, among
                                      ------------
other things, serving as the managing member of PVOC, engaging in any business
activity permitted to be engaged by PVOC pursuant to the Amended and Restated
Limited Liability Company Agreement of PVOC and engaging in any business
activity approved by GP LLC;

         WHEREAS, in order to accomplish the objectives and purposes in the
preceding recital, the following actions have previously been taken prior to the
date hereof:

         1.    Holding has formed GP LLC, and contributed $1,000 in capital to
it as a capital contribution in exchange for all of the membership interests in
GP LLC;

         2.    GP LLC and Holding have formed the MLP, with GP LLC contributing
$20 in exchange for a 2% general partner interest and Holding contributing $980
in exchange for a 98% limited partner interest;

         3.    Holding has formed Resource Holdings, and contributed its 100%
membership interest in GP LLC and its 98% limited partner interest in the MLP to
it as a capital contribution in exchange for all of Resource Holdings' common
stock;

         4.    Resource Holdings has formed LP Corp. and contributed its 98%
limited partner interest in the MLP to it as a capital contribution in exchange
for all of LP Corp's common stock;

                                       1
<PAGE>

         5.    Resource Holdings has formed GP Corp and contributed $1,000 to it
as a capital contribution in exchange for all GP Corp's common stock;

         6.    PVCC has formed PVOC, and contributed $1,000 to it as a capital
contribution in exchange for all of the membership interests in PVOC;

         7.    Wise has formed Wise LLC, and contributed $1,000 to it as a
capital contribution in exchange for all of the membership interests in Wise
LLC;

         8.    PCC has formed Loadout LLC, and contributed $1,000 to it as a
capital contribution in exchange for all of the membership interests in Loadout
LLC; and

         9.    KRC has formed K Rail LLC, and contributed $1,000 to it as a
capital contribution in exchange for all of the membership interests in K Rail
LLC.

         WHEREAS, concurrently with the consummation of the transactions
contemplated hereby, each of the following matters shall occur:

         1.    Holding will contribute all of the common stock of PVCC to
Resource Holdings as a capital contribution.

         2.    PVCC will merge into PVOC, Wise will merge into Wise LLC and PCC
will merge into Loadout LLC.

         3.    KRC will contribute the assets listed in Exhibit A hereto (the
                                                        ---------
"KRC Assets") to K Rail LLC as a capital contribution.
 ----------

         4.    Concord Land Company, a Virginia corporation, will convert to PVR
Concord LLC, a Delaware limited liability company, Lexington Land Company, a
Virginia corporation, will convert to PVR Lexington LLC, a Delaware limited
liability company, and Savannah Land Company, a Virginia corporation, will
convert to PVR Savannah LLC, a Delaware limited liability company.

         5.    PVOC will distribute the oil and gas interests set forth in
Exhibit B hereto (the "Oil and Gas Interests"), the stock of Powell River Rail
---------              ---------------------
Corporation, a Virginia corporation ("Powell River"), and the stock of KRC, to
                                      ------------
Resource Holdings.

         6.    Resource Holdings will distribute the Oil and Gas Interests to
Holding as a dividend.

         7.    Holding will contribute the Oil and Gas Interests to PVOG as a
capital contribution.

         8.    Resource Holdings will contribute a portion of its membership
interest in PVOC, such portion to be specifically determined by the parties
hereto, to GP LLC and a portion of its membership interest in PVOC, such portion
to be specifically determined by the parties hereto, to LP Corp, as capital
contributions. The sum of the portions of Resource Holdings' interest in

                                       2
<PAGE>

PVOC to be contributed to GP LLC and LP Corp shall equal 100% of the membership
interest of PVOC.

         9.    Resource Holdings will contribute its membership interest in GP
LLC to GP Corp as a capital contribution.

         10.   GP LLC will contribute its membership interest in PVOC to the MLP
in exchange for a continuation of its 2% general partner interest in the MLP.

         11. LP Corp will contribute its membership interest in PVOC to the MLP
in exchange for a 97.5% limited partner interest in the MLP.

         12.   KRC will contribute its membership interest in K Rail LLC to the
MLP in exchange for a .5% limited partner interest in the MLP.

         13.   The MLP will contribute its interest in K Rail LLC to PVOC as a
capital contribution.

         NOW,  THEREFORE, in consideration of their mutual undertakings and
agreements hereunder, the parties to this Agreement undertake and agree as
follows:

                                   Article I
                                  Recordation

         Section 1.1 Recordation of Evidence of Ownership of Assets. In
                     ----------------------------------------------
connection with the mergers under the Delaware Act that are referred to in the
recitals to this Agreement, the parties to this Agreement acknowledge that
certain jurisdictions in which the assets of the applicable parties to such
mergers are located may require that documents be recorded by the entities
resulting from such mergers in order to evidence title in such entities. All
such documents shall evidence such new ownership and are not intended to modify,
and shall not modify, any of the terms, covenants and conditions herein set
forth .

                                  Article II
              Contributions and Distributions of Various Assets,
    Stock, and Limited Partnership and Limited Liability Company Interests

         Section 2.1 Contribution of PVCC Stock by Holding to Resource Holdings.
                     ----------------------------------------------------------
Holding hereby grants, contributes, transfers, assigns and conveys to Resource
Holdings, its successors and assigns, all right, title and interest of Holding
in and to all of the common stock of PVCC (the "PVCC Stock"), and Resource
                                                ----------
Holdings hereby accepts the PVCC Stock as a contribution to the capital of
Resource Holdings in exchange for all the membership interest in Resource
Holdings.

         Section 2.2 Mergers of PVCC into PVOC, Wise into Wise LLC and PCC into
                     ----------------------------------------------------------
Loadout LLC. PVCC merges into PVOC, Wise merges into Wise LLC and PCC merges
-----------
into Loadout LLC.

                                       3
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         Section 2.3 Contribution of KRC Assets by KRC to K Rail LLC. KRC hereby
         -----------------------------------------------------------
grants, contributes, transfers, assigns and conveys to K Rail LLC, its
successors and assigns, all right, title and interest in and to the KRC Assets,
and K Rail LLC hereby accepts the KRC Assets as a contribution to the capital of
K Rail LLC in exchange for all the membership interest in K Rail LLC. In order
to give full effect to the foregoing grant, contribution, transfer, assignment
and conveyance, KRC, as grantor, and K Rail LLC, as grantee, shall execute a
Special Warranty Deed in the form attached hereto as Exhibit C.
                                                     ---------

         Section 2.4 Distribution of Oil and Gas Interests,  Powell River Stock
                     ----------------------------------------------------------
and KRC Stock by PVOC to Resource Holdings.  PVOC hereby  grants,  distributes,
------------------------------------------
transfers, assigns and conveys to Resource Holdings, its successors and assigns,
all right,  title and interest of PVOC in and to the Oil and Gas Interests,  all
the common stock of Powell River (the "Powell River Stock"),  and all the common
                                       ------------------
stock of KRC (the "KRC Stock"),  and Resource  Holdings  accepts the Oil and Gas
                   ---------
Interests,  the Powell River Stock, and the KRC Stock as a dividend. In order to
give full effect to the foregoing grants, distributions,  transfers, assignments
and conveyances,  PVOC, and Resource Holdings, shall execute three Agreements to
Lease in the forms attached hereto as Exhibit D, with respect to the Oil and Gas
                                      ---------
Interests,  and a Conveyance,  Assignment  and Bill of Sale in the form attached
hereto as Exhibit E, with respect to the Powell River Stock and the KRC Stock.
          ---------

         Section 2.5 Distribution of Oil and Gas Interests by Resource Holdings
                     ----------------------------------------------------------
to Holding. Resource Holdings hereby grants, distributes, transfers, assigns and
----------
conveys to Holding, its successors and assigns, all right, title and interest of
Resource Holdings in and to the Oil and Gas Interests, and Holding accepts the
Oil and Gas Interests as a dividend. In order to give full effect to the
foregoing grant, distribution, transfer, assignment and conveyance, Resource
Holdings, as assignor, and Holding, as assignee, shall execute an Assignment in
the form attached hereto as Exhibit F.
                            ---------

         Section 2.6 Contribution of Oil and Gas Interests by Holding to PVOG.
                     --------------------------------------------------------
Holding hereby grants, contributes, transfers, assigns and conveys to PVOG, its
successors and assigns, all right, title and interest of Holding in and to the
Oil and Gas Interests, and PVOG hereby accepts the Oil and Gas Interests as a
capital contribution in exchange for a continuation of its continued ownership
of all the common stock of GP Corp. In order to give full effect to the
foregoing grant, distribution, transfer, assignment and conveyance, Holding, as
assignor, and PVOG, as assignee, shall execute an Assignment in the form
attached hereto as Exhibit G.
                   ---------

         Section 2.7 Contribution of the GP LLC PVOC Interest and the LP Corp
                     --------------------------------------------------------
PVOC Interest by Resource Holdings to GP LLC and LP Corp. Resource Holdings
--------------------------------------------------------
hereby grants, contributes, transfers, assigns and conveys to GP LLC, its
successors and assigns, all right, title and interest of Resource Holdings in
and to a portion of its membership interest in PVOC, such portion to be
specifically determined by the parties hereto (the "GP LLC PVOC Interest"), and
                                                    --------------------
hereby grants, contributes, transfers, assigns and conveys to LP Corp, its
successors and assigns, all right, title and interest of Resource Holdings in
and to a portion of its membership interest in PVOC, such portion to be
specifically determined by the parties hereto (the "LP Corp PVOC Interest"), and
                                                    ---------------------
GP LLC and LP Corp hereby accept the GP LLC PVOC Interest and LP Corp PVOC
Interest, respectively .

                                       4
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         Section 2.8  Contribution of GP LLC Interest by Resource Holdings to GP
                      ----------------------------------------------------------
Corp. Resource Holdings hereby grants, contributes, transfers, assigns and
----
conveys to GP Corp, its successors and assigns, all right, title and interest of
Resource Holdings in and to its membership interest in GP LLC equal to a 100%
membership interest (the "GP LLC Interest"), and GP Corp hereby accepts the GP
                          ---------------
LLC Interest as a capital contribution in exchange for a continuation of its
continued Ownership of all the common stock of GP Corp.

         Section 2.9  Contribution of GP LLC PVOC Interest by GP LLC to the MLP.
                      ---------------------------------------------------------
GP LLC hereby grants, contributes, transfers, assigns and conveys to the MLP,
its successors and assigns, all right, title and interest of GP LLC in and to
its GP LLC PVOC Interest and the related incentive distribution rights, and the
MLP hereby accepts the GP LLC PVOC Interest and the related incentive
distribution rights as a capital contribution in exchange for a continuation of
the 2% general partner interest of GP LLC in the MLP.

         Section 2.10 Contribution of PVOC LP Interest by LP Corp to the MLP. LP
                      ------------------------------------------------------
Corp hereby grants, contributes, transfers, assigns and conveys to the MLP, its
successors and assigns, all right, title and interest of LP Corp in and to its
PVOC LP Interest, and the MLP hereby accepts the PVOC LP Interest as a capital
contribution in exchange for a 97.5% limited partner interest in the MLP.

         Section 2.11 Contribution of K Rail LLC Interest by KRC to the MLP. KRC
                      -----------------------------------------------------
hereby grants, contributes, transfers, assigns and conveys to the MLP, its
successors and assigns, all right, title and interest of KRC in and to its
membership interest in K Rail LLC (the "K Rail LLC Interest"), and the MLP
                                        -------------------
hereby accepts the K Rail LLC Interest as a capital contribution in exchange for
a .5% limited partner interest in the MLP.

         Section 2.12 Contribution of K Rail LLC Interest by MLP to PVOC. The
                      --------------------------------------------------
MLP hereby grants, contributes, transfers, assigns and conveys to PVOC, its
successors and assigns, all right, title and interest of the MLP in and to the K
Rail LLC Interest as a contribution to the capital of PVOC, and PVOC hereby
accepts the K Rail LLC Interest as a capital contribution in exchange for a
continuation of its 100% membership interest in PVOC.

                                  Article III
                       Assumption of Certain Liabilities

         Section 3.1  Assumption of Liabilities and Obligations of PVOC by PVOG.
                      ---------------------------------------------------------
In connection with the distribution by PVOC of the Oil and Gas Interests to
Resource Holdings, the subsequent distribution by Resource Holdings of the Oil
and Gas Interests to Holding and the subsequent contribution by Holding of the
Oil and Gas Interests to PVOG, PVOG hereby assumes and agrees to duly and timely
pay, perform and discharge all obligations and liabilities incurred with respect
to the Oil and Gas Interests that arise from and after the date of this
Agreement, to the full extent that PVOC would have been obligated to pay,
perform and discharge such obligations and liabilities in the future, were it
not for the execution and delivery of this Agreement; provided, however, that
said assumption and agreement to duly and timely pay, perform and discharge such
obligations and liabilities shall not increase the obligation of PVOG with
respect to such obligations and liabilities beyond that of PVOC to the extent of
such interest conveyed by PVOC.

                                       5
<PAGE>

         Section 3.2 Assumption of Liabilities and Obligations of KRC by K Rail
                     ----------------------------------------------------------
LLC. In connection with the contribution by KRC of the KRC Assets to K Rail LLC,
---
K Rail LLC hereby assumes and agrees to duly and timely pay, perform and
discharge all obligations and liabilities incurred with respect to the KRC
Assets that arise from and after the date of this Agreement, to the full extent
that KRC would have been obligated to pay, perform and discharge such
obligations and liabilities in the future, were it not for the execution and
delivery of this Agreement; provided, however, that said assumption and
agreement to duly and timely pay, perform and discharge such obligations and
liabilities shall not increase the obligation of K Rail LLC with respect to such
obligations and liabilities beyond that of KRC to the extent of such interest
conveyed by KRC.

                                  Article IV
                                 Title Matters

         Section 4.1 Encumbrances. The distributions of the Oil and Gas
                     ------------
Interests made to Resource Holdings and Holding and the contribution of the Oil
and Gas Interests to PVOG under this Agreement are made expressly subject to all
recorded and unrecorded liens, encumbrances, agreements, defects, restrictions,
adverse claim and all laws, rules, regulations, ordinances, judgments and orders
of governmental authorities or tribunals having or asserting jurisdiction over
the Oil and Gas Interests and operations conducted thereon or in connection
therewith, in each case to the extent the same are valid and enforceable and
affect the Oil and Gas Interests, including, without limitation, (a) all matters
that a current on the ground survey or visual inspection of the Oil and Gas
Interests would reflect, and (b) the liabilities assumed by PVOG with respect to
the Oil and Gas Interests.

         Section 4.2 Disclaimer of Warranties; Subrogation; Waiver of Bulk Sales
                     -----------------------------------------------------------
Laws.
----

                 (a) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, PVOG AND K RAIL LLC ACKNOWLEDGES AND AGREES THAT PVOC, RESOURCE
HOLDINGS, HOLDINGS AND KRC HAVE NOT MADE, DO NOT MAKE, AND SPECIFICALLY NEGATE
AND DISCLAIM, ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS
OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS, IMPLIED OR
STATUTORY, ORAL OR WRITTEN, PAST OR PRESENT (ALL OF WHICH ARE EXPRESSLY
DISCLAIMED BY PVOC, RESOURCE HOLDINGS, HOLDING AND KRC), REGARDING (1) THE
TITLE, VALUE, NATURE, QUALITY OR CONDITION OF THE OIL AND GAS INTERESTS OR THE
KRC ASSETS INCLUDING WITHOUT LIMITATION, THE WATER, SOIL, GEOLOGY OR
ENVIRONMENTAL CONDITION OF THE OIL AND GAS INTERESTS GENERALLY, INCLUDING THE
PRESENCE OR LACK OF HAZARDOUS SUBSTANCES OR OTHER MATTERS ON THE OIL AND GAS
INTERESTS OR THE KRC ASSETS, (2) THE INCOME TO BE DERIVED FROM THE OIL AND GAS
INTERESTS OR THE KRC ASSETS, (3) THE SUITABILITY OF THE OIL AND GAS INTERESTS OR
THE KRC ASSETS FOR ANY AND ALL ACTIVITIES AND USES WHICH PVOG OR K RAIL LLC MAY
CONDUCT THEREON, (4) THE COMPLIANCE OF OR BY THE OIL AND GAS INTERESTS OR THE
KRC ASSETS OR THEIR OPERATIONS WITH ANY LAWS (INCLUDING WITHOUT LIMITATION ANY
ZONING, ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES,

                                       6
<PAGE>

REGULATIONS, ORDERS OR REQUIREMENTS), OR (5) THE HABITABILITY, MERCHANTABILITY,
MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE OIL AND
GAS INTERESTS OR THE KRC ASSETS. PVOG AND K RAIL LLC ACKNOWLEDGE AND AGREE THAT
PVOG AND K RAIL LLC EACH HAVE HAD THE OPPORTUNITY TO INSPECT THE OIL AND GAS
INTERESTS AND THE KRC ASSETS AND PVOG AND K RAIL LLC EACH IS RELYING SOLELY ON
ITS OWN INVESTIGATION OF THE OIL AND GAS INTERESTS AND NOT ON ANY INFORMATION
PROVIDED OR TO BE PROVIDED BY PVOC, RESOURCE HOLDINGS, HOLDING OR KRC. PVOC,
RESOURCE HOLDINGS, HOLDING AND KRC ARE NOT LIABLE OR BOUND IN ANY MANNER BY ANY
VERBAL OR WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE
OIL AND GAS INTERESTS AND THE KRC ASSETS FURNISHED BY ANY AGENT, EMPLOYEE,
SERVANT OR THIRD PARTY. PVOG AND K RAIL LLC EACH ACKNOWLEDGE THAT TO THE MAXIMUM
EXTENT PERMITTED BY LAW, THE CONTRIBUTION OF THE OIL AND GAS INTERESTS AND K
RAIL LLC AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS", "WHERE IS" BASIS WITH ALL
FAULTS AND THE OIL AND GAS INTERESTS AND THE KRC ASSETS ARE CONTRIBUTED OR
DISTRIBUTED AND CONVEYED BY PVOC, RESOURCE HOLDINGS, HOLDING AND KRC AND
ACCEPTED BY PVOG AND K RAIL LLC SUBJECT TO THE FOREGOING. THIS PARAGRAPH SHALL
SURVIVE SUCH CONTRIBUTION OR DISTRIBUTION AND CONVEYANCE OR THE TERMINATION OF
THIS AGREEMENT. THE PROVISIONS OF THIS SECTION 4.2 HAVE BEEN NEGOTIATED BY PVOC,
RESOURCE HOLDINGS, HOLDING PVOG, K RAIL LLC AND KRC AFTER DUE CONSIDERATION AND
ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR
WARRANTIES OF PVOC, RESOURCE HOLDINGS, HOLDING AND KRC, WHETHER EXPRESS, IMPLIED
OR STATUTORY, WITH RESPECT TO THE OIL AND GAS INTERESTS AND THE KRC ASSETS THAT
MAY ARISE PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT, OR OTHERWISE.

              (b)  The distributions and contributions of the Oil and Gas
Interests and KRC Assets made under this Agreement is made with full rights of
substitution and subrogation of PVOG and K Rail LLC, and all persons claiming
by, through and under PVOG and K Rail LLC, to the extent assignable, in and to
all covenants and warranties by the predecessors-in-title of PVOC, Resource
Holdings, Holding and KRC, and with full subrogation of all rights accruing
under applicable statutes of limitation and all rights of action of warranty
against all former owners of the Oil and Gas Interests and KRC Assets.

              (c)  PVOC, Resource Holdings, Holding, PVOG, K Rail LLC and KRC
agree that the disclaimers contained in this Section 4.2 are "conspicuous"
disclaimers. Any covenants implied by statute or law by the use of the words
"grant," "convey," "bargain," "sell," "assign," "transfer," "deliver," or "set
over" or any of them or any other words used in this Agreement or any exhibits
hereto are hereby expressly disclaimed, waived or negated.

              (d)  Each of the parties hereto hereby waives compliance with any
applicable bulk sales law or any similar law in any applicable jurisdiction in
respect of the transactions contemplated by this Agreement. "Laws" means any and
                                                             ----
all laws, statutes, ordinances, rules or regulations promulgated by a
governmental authority, orders of a governmental authority,

                                       7
<PAGE>

judicial decisions, decisions of arbitrators or determinations of any
governmental authority or court.

                                   Article V
                              Further Assurances

         Section 5.1 Further Assurances. From time to time after the date
                     ------------------
hereof, and without any further consideration, PVOC, Resource Holdings, Holding,
PVOG, K Rail LLC and KRC shall execute, acknowledge and deliver all such
additional deeds, assignments, bills of sale, conveyances, instruments, notices,
releases, acquittances and other documents, and will do all such other acts and
things, all in accordance with applicable law, as may be necessary or
appropriate more fully and effectively to vest in PVOG and K Rail LLC and their
successors and assigns beneficial and record title to the interests hereby
contributed and assigned to PVOG and K Rail LLC or intended so to be and to more
fully and effectively carry out the purposes and intent of this Agreement.

         Section 5.2 Other Assurances. From time to time after the date hereof,
                     ----------------
and without any further consideration, each of the parties to this Agreement
shall execute, acknowledge and deliver all such additional instruments, notices
and other documents, and will do all such other acts and things, all in
accordance with applicable law, as may be necessary or appropriate to more fully
and effectively carry out the purposes and intent of this Agreement.

                                  Article VI
                                 Miscellaneous

         Section 6.1 Order of Completion of Transactions. The transactions
                     -----------------------------------
provided for in Article II and Article III of this Agreement shall be completed
on the date of this Agreement in the following order:

                 (a) First, the transactions provided for in Article II shall
                     -----
be completed in the order set forth herein; and

                 (b) Second, the transactions provided for in Article III shall
                     ------
be completed in the order set forth herein.

         Section 6.2 Headings; References; Interpretation. All article and
                     ------------------------------------
section headings in this Agreement are for convenience only and shall not be
deemed to control or affect the meaning or construction of any of the provisions
hereof. The words "hereof," "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole,
including without limitation, all exhibits attached hereto, and not to any
particular provision of this Agreement. All references herein to articles,
sections, and exhibits shall, unless the context requires a different
construction, be deemed to be references to the articles, sections and exhibits
of this Agreement, respectively, and all such Exhibits attached hereto are
hereby incorporated herein and made a part hereof for all purposes. All personal
pronouns used in this Agreement, whether used in the masculine, feminine or
neuter gender, shall include all other genders, and the singular shall include
the plural and vice versa. The use herein of the word "including" following any
general statement, term or matter shall not be construed to limit such
statement, term or matter to the specific items or matters set forth immediately

                                       8
<PAGE>

following such word or to similar items or matters, whether or not non-limiting
language (such as "without limitation," "but not limited to," or words of
similar import) is used with reference thereto, but rather shall be deemed to
refer to all other items or matters that could reasonably fall within the
broadest possible scope of such general statement, term or matter.

         Section 6.3 Successors and Assigns. The Agreement shall be binding upon
                     ----------------------
and inure to the benefit of the parties signatory hereto and their respective
successors and assigns.

         Section 6.4 No Third Party Rights. The provisions of this Agreement are
                     ---------------------
intended to bind the parties signatory hereto as to each other and are not
intended to and do not create rights in any other person or confer upon any
other person any benefits, rights or remedies and no person is or is intended to
be a third party beneficiary of any of the provisions of this Agreement.

         Section 6.5 Counterparts. This Agreement may be executed in any number
                     ------------
of counterparts, all of which together shall constitute one agreement binding on
the parties hereto.

         Section 6.6 Governing  Law. This Agreement shall be governed by, and
                     --------------
construed in accordance with, the laws of the State of Delaware applicable to
contracts made and to be performed wholly within such state without giving
effect to conflict of law principles thereof, except to the extent that it is
mandatory that the law of some other jurisdiction, shall apply.

         Section 6.7 Severability. If any of the provisions of this Agreement
                     ------------
are held by any court of competent jurisdiction to contravene, or to be invalid
under, the laws of any political body having jurisdiction over the subject
matter hereof, such contravention or invalidity shall not invalidate the entire
Agreement. Instead, this Agreement shall be construed as if it did not contain
the particular provision or provisions held to be invalid, and an equitable
adjustment shall be made and necessary provision added so as to give effect to
the intention of the parties as expressed in this Agreement at the time of
execution of this Agreement.

         Section 6.8 Amendment or Modification. This Agreement may be amended or
                     -------------------------
modified  from time to time only by the  written  agreement  of all the  parties
hereto.

         Section 6.9 Integration. This Agreement supersedes all previous
                     -----------
understandings or agreements between the parties, whether oral or written, with
respect to its subject matter. This document is an integrated agreement which
contains the entire understanding of the parties. No understanding,
representation, promise or agreement, whether oral or written, is intended to be
or shall be included in or form part of this Agreement unless it is contained in
a written amendment hereto executed by the parties hereto after the date of this
Agreement.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       9
<PAGE>

         IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the date first above written.

PVCC:                        PENN VIRGINIA COAL COMPANY, a Virginia
                             corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

PVOC:                        PENN VIRGINIA OPERATING CO., LLC, a Delaware
                             limited liability company

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

PVOG:                        PENN VIRGINIA OIL AND GAS
                             CORPORATION, a Virginia corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

HOLDING:                     PENN VIRGINIA HOLDING CORP., a
                             Delaware corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

RESOURCE HOLDINGS:           PENN VIRGINIA RESOURCE HOLDINGS
                             CORP., a Delaware corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

                                       10
<PAGE>

MLP:                         PENN VIRGINIA RESOURCE PARTNERS,
                             L.P., a Delaware limited partnership
                             By:     Penn Virginia Resource GP, LLC, a Delaware
                                     limited liability company, its general
                                     partner

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

GP LLC:                      PENN VIRGINIA RESOURCE GP, LLC, a
                             Delaware limited liability company

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

GP CORP:                     PENN VIRGINIA RESOURCE GP, CORP., a
                             Delaware corporation

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

LP CORP:                     PENN VIRGINIA RESOURCE LP, CORP., a
                             Delaware corporation

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

WISE:                        WISE ENVIRONMENTAL TECHNOLOGIES,
                             INC., a Virginia corporation

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

                                       11
<PAGE>

WISE LLC:                    WISE LLC, a Delaware limited liability company

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

PCC:                         PARAGON COAL CORPORATION, a Virginia
                             corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

LOADOUT LLC:                 LOADOUT LLC, a Delaware limited liability
                             company

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

KRC:                         KANAWHA RAIL CORP., a Virginia corporation

                             By: /s/ A James Dearlove
                                 -----------------------------------
                             Name: A James Dearlove
                                   ---------------------------------
                             Title: Chief Executive Officer
                                    --------------------------------

K RAIL LLC:                  K RAIL LLC, a Delaware limited liability
                             company

                             By: /s/ Nancy M Snyder
                                 -----------------------------------
                             Name: Nancy M Snyder
                                   ---------------------------------
                             Title: Vice President
                                    --------------------------------

                                       12
<PAGE>

                                   EXHIBIT A
                                   ---------

                                  KRC ASSETS

     All those certain fee lands, surface estates and interests, mineral estates
and interests, oil and gas estates and interests, coal estates and interest, and
all other real estate interests, together with all improvements thereon, all
mining rights, privileges, easements, hereditaments, rights of reverter,
reversion, and remainder, and appurtenances thereunto belonging or in anywise
appertaining, situated in Cabin Creek and Louden Districts, Kanawha County, West
Virginia, being the same lands, estates, oil, gas, minerals, coal, surface and
fee property interests, as are identified and more particularly described in,
and conveyed to, the Winifrede Railroad Company by the following deeds:

     1.  Deed from John S. Burdette and Sally M. Burdette, his wife, dated
August 10, 1885, and recorded in the office of the Clerk of the County
Commission of Kanawha County, West Virginia in Deed Book 43, at page 108;

     2.  Deed from Chesapeake and Ohio Railroad Company, dated July 20, 1886,
and recorded in said Clerk's office in Deed Book 44, at page 566;

     3.  Deed from Eli Cooper and Ruth Cooper, his wife, dated April 25, 1891,
and recorded in said Clerk's office in Deed Book 55, at page 318;

     4.  Deed from J. C. Curry, Sr. and wife, dated November 19, 1956,
unrecorded;

     5.  Deed from J. C. Curry, Sr., dated March 16, 1970, unrecorded;

     6.  Deed from Sallie L. Goshorn, dated May 8, 1890, of record in said
Clerk's office in Deed Book 52, at page 387;

     7.  Deed from John M. McConihay, et al., dated May 12, 1886, of record in
said Clerk's office in Deed Book 44, at page 284;

                                   Exhibit A
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

     8.  Deed from S. E. "Eddie" McConihay, Sr., and Wanda McConihay, his wife,
dated March 17, 1989, of record in said Clerk's office in Deed Book 2221, at
page 407;

     9.  Deed from L. E. McWhorter, as Special Commissioner, dated July 1, 1892,
of record in said Clerk's office in Deed Book 59, at page 755;

     10. Deed from Dickinson Shrewsberry and Mary S. Shrewsbury, his wife, dated
July 16, 1892, of record in said Clerk's office in Deed Book 60, at page 41;

     11. Deed from Mary J. Shrewsberry and Dickinson Shrewsberry, her husband,
dated June 23, 1886, of record in said Clerk's office in Deed Book 44, at page
441;

     12. Deed from Theodore Wright and Mary B. Wright, his wife, dated August
19, 1882, of record in said Clerk's office in Deed Book 37, at page 621; and

     13. Deed to the Winifrede Railroad Company from R. W. Cabell, et al., dated
March 26, 1888, and recorded in said Clerk's office in Deed Book 48, at page
225; and

     14. Deed to the Winifrede Railroad Company from Daniel McConihay and Julia
A. McConihay, his wife, dated January 11, 1892, and recorded in said Clerk's
office in Deed Book 58, at page 145.

PROVIDED, HOWEVER, THAT the party of the first part hereby expressly excepts and
reserves from this conveyance the following portion of the property described
and conveyed by deed from Theodore Wright and Mary B. Wright, his wife, dated
August 19, 1882, of record in said Clerk's office in Deed Book 37, at page 621,
said portion being more particularly described and defined by the centerline and
thirty feet (30') on each side thereof of the main line of the Kanawha Rail
Corp. railroad beginning at the intersection of the right-of-way of the CSX
Railroad and the Kanawha Rail Corp. main line and including the entire length of
the Kanawha Rail Corp. railroad for a total distance of Thirty-Three Thousand
Nine Hundred Eighty-Two feet (33,982 feet) containing 46.7 acres, more or less.

                                   Exhibit A
              to Contribution, Conveyance and Assumption Agreement

                                      -2-
<PAGE>

                                   Exhibit B
                                   ---------

                             OIL AND GAS INTERESTS

                                   Exhibit B
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

                                   EXHIBIT C
                                   ---------

                             Special Warranty Deed

                                   Exhibit C
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

                                   EXHIBIT D
                                   ---------

                Form of Conveyance, Assignment And Bill Of Sale

Recording Requested by and When Recorded Return to: Vinson & Elkins L.L.P., 2001
Ross Avenue, Dallas, Texas 75201, Attn: Jeffrey W. Burnett

                    CONVEYANCE, ASSIGNMENT AND BILL OF SALE

     This Conveyance, Assignment and Bill of Sale (this "Conveyance"), effective
                                                         ----------
as of September 15, 2001 (the "Effective Date"), is from PENN VIRGINIA OPERATING
                               --------------
CO., LLC, a Delaware limited liability company (successor by merger under (S)
18-209 of the Delaware Limited Liability Company Act to Penn Virginia Coal
Company, a Virginia corporation) (herein called "Grantor"), and in favor of PENN
                                                 -------
VIRGINIA RESOURCE HOLDINGS, INC., a Delaware corporation, whose mailing address
is __________________, __________________, _________________ (herein called
"Grantee").
 -------
                                   ARTICLE I
                         GRANTING AND HABENDUM CLAUSES

     1.1  Granting and Habendum Clauses.
          -----------------------------

     For good and valuable consideration, the receipt and sufficiency of which
Grantee hereby acknowledges, Grantor hereby contributes, conveys, assigns,
transfers, delivers, and sets over unto Grantee, its successors and assigns, all
right, title, interests and estate of Grantor in and to the following described
property, to-wit:

     (a)  Powell River Stock. All the common stock of Powell River Rail
          ------------------
Corporation, a Virginia corporation equal to all of the shares of common stock
(the "Powell River Stock"); and
      ------------------

     (b)  KRC Stock. All the common stock of Kanawha Rail Corp., a Virginia
          ---------
corporation equal to all of the shares of common stock (the "KRC Stock").
                                                             ---------

     The property described in (a) through (b) of this Section 1.1 shall be
referred to herein collectively as the "Subject Property".
                                        ----------------

     TO HAVE AND TO HOLD the Subject Property, subject to the terms and
conditions hereof, unto Grantee, its successors and assigns, forever.

                                  ARTICLE II
                     ENCUMBRANCES AND WARRANTY DISCLAIMERS

     2.1  Permitted Encumbrances.
          ----------------------

     This Conveyance is made and accepted expressly subject to (a) all liens,
charges, encumbrances, contracts, agreements, instruments, obligations, defects,
restrictions, security interests, options or preferential rights to purchase,
adverse claims, reservations, exceptions,

                                   Exhibit D
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

easements, rights-of-way, conditions, leases, other matters affecting the
Subject Property or to which it is subject; and (b) to all matters that a
current on the ground survey or visual inspection would reflect.

     2.2  Contributions Agreement.
          -----------------------

     This Conveyance is expressly made subject to the terms and conditions of
that certain Contribution, Conveyance and Assumption Agreement dated as of
September 14, 2001, among Grantor, Grantee and the other parties thereto (the
"Contribution Agreement"). All capitalized terms used herein shall have the
 ----------------------
meanings given to such terms in the Contribution Agreement, unless otherwise
defined herein. Nothing contained in this Conveyance shall in any way affect the
provisions set forth in the Contribution Agreement nor shall this Conveyance
expand or contract any rights or remedies under the Contribution Agreement,
including without limitation any rights to indemnification specified therein.
This Conveyance is intended only to effect the transfer of the Subject Property
to Grantee as provided for in the Contribution Agreement and shall be governed
entirely in accordance with the terms and conditions of the Contribution
Agreement. In the event of a conflict between the terms of this Conveyance and
the terms of the Contribution Agreement, the terms of the Contribution Agreement
shall prevail.

     2.3  Disclaimer of Warranties; Subrogation.
          -------------------------------------

     Except as expressly provided herein or in the Contribution Agreement, this
Conveyance is made, and is accepted by Grantee, without warranty of title,
express, implied or statutory, and without recourse, but with full substitution
and subrogation of Grantee, and all persons claiming by, through, and under
Grantee, to the extent assignable, in and to all covenants and warranties by the
predecessors in title of Grantor and with full subrogation of all rights
accruing under applicable statutes of limitation or prescription and all rights
of action of warranty against all former owners of the Subject Property. Except
as expressly provided herein or in the Contribution Agreement, any covenants
implied by statute or by the use of the words "convey", "sell", "assign",
"transfer", "deliver", or "set over" or any of them or any other words used in
this Conveyance, are hereby expressly disclaimed, waived and negated.

                                  ARTICLE III
                                 MISCELLANEOUS

     3.1  Further Assurances.
          ------------------

     Grantor and Grantee agree to take all such further actions and to execute,
acknowledge and deliver all such further documents that are necessary or useful
in carrying out the purposes of this Conveyance. So long as authorized by
applicable law so to do, Grantor agrees to execute, acknowledge and deliver to
Grantee all such other additional instruments, notices, affidavits, deeds,
conveyances, assignments and other documents and to do all such other and
further acts and things as may be necessary or useful to more fully and
effectively grant, bargain, assign, convey, transfer and deliver to Grantee the
Subject Property conveyed hereby or intended so to be conveyed.

     3.2  Successors and Assigns; No Third Party Beneficiary.
          --------------------------------------------------

                                   Exhibit D
             to Contribution, Conveyance and Assumption Assumption

                                      -2-
<PAGE>

     This Conveyance shall be binding upon, and shall and inure to the benefit
of, Grantor and Grantee and their successors and assigns. The provisions of this
Conveyance are not intended to and do not create rights in any other person or
entity or confer upon any other person or entity any benefits, rights or
remedies and no person or entity is or is intended to be a third party
beneficiary of any of the provisions of this Conveyance.

     3.3  Governing Law.
          -------------

     This Conveyance and the legal relations between the parties shall be
governed by, and construed in accordance with, the laws of the State of
Delaware, excluding any conflict of law rule which would refer any issue to the
laws of another jurisdiction, except when it is mandatory that the law of the
jurisdiction wherein the Subject Property is located shall apply.

     3.5  Exhibits.
          --------

          Reference is made to Exhibit A which is attached hereto and made a
                               ---------
part hereof for all purposes.

     3.6  Headings; References; Defined Terms.
          -----------------------------------

     All Section headings in this Conveyance are for convenience only and shall
not be deemed to control or affect the meaning or construction of any of the
provisions hereof. The words "hereof", "herein" and "hereunder" and words of
similar import, when used in this Conveyance, shall refer to this Conveyance as
a whole, including, without limitation, all Schedules and Exhibits attached
hereto, and not to any particular provision of this Conveyance.

     3.7  Counterparts.
          ------------

     This Conveyance may be executed in any number of counterparts, all of which
together shall constitute one agreement binding on the parties hereto.

     3.8  Severability.
          ------------

     If any of the provisions of this Conveyance are held by any court of
competent jurisdiction to contravene, or to be invalid under, the laws of any
political body having jurisdiction over the subject matter hereof, such
contravention or invalidity shall not invalidate the entire agreement. Instead,
this Conveyance shall be construed as if it did not contain the particular
provision or provisions held to be invalid and an equitable adjustment shall be
made and necessary provision added so as to give effect to the intention of the
parties as expressed in this Conveyance at the time of execution of this
Conveyance.

                                   Exhibit D
             to Contribution, Conveyance and Assumption Agreement

                                      -3-
<PAGE>

     IN WITNESS WHEREOF, this Conveyance has been duly executed by the parties
hereto on the dates of the acknowledgments set forth below, to be effective,
however, as of the Effective Date.

                                    GRANTOR:

                                    PENN VIRGINIA OPERATING CO., LLC, a
                                    Delaware limited liability company

                                    By:_____________________________________
                                        Nancy M. Snyder, Vice President

                                    GRANTEE:

                                    PENN VIRGINIA RESOURCE HOLDINGS, INC., a
                                    Delaware corporation

                                        By:_________________________________
                                            Nancy M. Snyder, Vice President

                                   Exhibit D
             to Contribution, Conveyance and Assumption Agreement

                                      -4-
<PAGE>

STATE OF __________       )
                          ) SS.
COUNTY OF _________       )

     This instrument was acknowledged before me on the ____ day of September
2001, by Nancy M. Snyder, Vice President of PENN VIRGINIA OPERATING CO., LLC, a
Delaware limited liability company, on behalf of and in her capacity as Vice
President of PENN VIRGINIA OPERATING CO., LLC.

                                        ________________________________________
                                        NOTARY PUBLIC

My Commission Expires:

________________________

STATE OF __________       )
                          ) SS.
COUNTY OF _________       )

     This instrument was acknowledged before me on the ____ day of September,
2001, by Nancy M. Snyder, Vice President of PENN VIRGINIA RESOURCE HOLDINGS,
INC., a Delaware corporation, on behalf of and in her capacity as Vice President
of PENN VIRGINIA RESOURCE HOLDINGS, INC.

                                        ________________________________________
                                        NOTARY PUBLIC

My Commission Expires:

________________________

                                   Exhibit D
             to Contribution, Conveyance and Assumption Agreement

                                      -5-
<PAGE>

                                   EXHIBIT E
                                   ---------

                              AGREEMENTS TO LEASE
                              -------------------

                                   Exhibit E
             to Contribution, Conveyance and Assumption Agreement

                                      -6-
<PAGE>

                                   EXHIBIT F
                                   ---------

                           ASSIGNMENT OF AGREEMENTS
                           ------------------------

     This Assignment of Agreements (this "Agreement"), is entered into as of
                                          ---------
September 14, 2001, between PENN VIRGINIA RESOURCE HOLDINGS CORP., a Delaware
corporation ("Assignor") and PENN VIRGINIA HOLDING CORP., a Virginia corporation
              --------
("Assignee").
  --------

                                   RECITALS:
                                   --------

     A.  Assignor and Penn Virginia Operating Co., LLC, a Delaware limited
liability company ("PVOC") entered into three forms of Agreement to Lease, each
                    ----
dated September 14, 2001 (the "Agreements"), under which PVOC conditionally
                               ----------
agrees to grant certain options to lease to Assignor.

     B.  Assignor desires to assign to Assignee all of Assignor's interest in
the Agreements, and Assignee desires to assume all of Assignor's obligations
under the Agreements, subject to the terms and conditions contained herein.

                                  AGREEMENTS:
                                  ----------

     For good and valuable consideration, whose receipt and sufficiency are
acknowledged, the parties agree as follows:

     1.  Assignment.  Assignor assigns to Assignee all of Assignor's interest in
         ----------
the Agreements, and shall warrant and forever defend such interest unto
Assignee, its successors and assigns, against every person whomsoever lawfully
claiming, or to claim the same, or any part thereof.

     2.  Assumption of Liabilities. Assignee assumes all of the obligations of
         -------------------------
the tenant under the Agreements arising on and after the date hereof.

     Executed on the date first written above.

ASSIGNOR:                          PENN VIRGINIA RESOURCE HOLDINGS CORP., a
                                   Delaware corporation

                                   By:__________________________________________
                                       Nancy M. Snyder, Vice President

ASSIGNEE:                          PENN VIRGINIA HOLDING CORP., a Virginia
                                   corporation

                                   By:__________________________________________
                                      A. James Dearlove, Chief Executive Officer

                                   Exhibit F
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

                                   EXHIBIT G
                                   ---------

                           ASSIGNMENT OF AGREEMENTS
                           ------------------------

     This Assignment of Agreements (this "Agreement"), is entered into as of
                                          ---------
September 14, 2001, between PENN VIRGINIA HOLDING CORP., a Virginia corporation
("Assignor"),and Penn Virginia Oil and Gas Corporation, a Virginia corporation
  --------
("Assignee").
  --------

                                   RECITALS:
                                   --------

     A.  Penn Virginia Operating Co., LLC, a Delaware limited liability company
("PVOC") and Penn Virginia Resource Holdings Corp., a Delaware limited liability
  ----
company ("Resource Holdings") entered into three forms of Agreement to Lease,
          -----------------
each dated September 14, 2001 (the "Agreements"), under which PVOC agrees to
                                    ----------
grant certain options to lease to Resource Holdings, and Resource Holdings
assigned to Assignor all of its interest in the Agreements, and Assignor assumed
all of Resource Holdings' obligations under the Agreements.

     B.  Assignor desires to assign to Assignee all of Assignor's interest in
the Agreements, and Assignee desires to assume all of Assignor's obligations
under the Agreements, subject to the terms and conditions contained herein.

                                  AGREEMENTS:
                                  ----------

     For good and valuable consideration, whose receipt and sufficiency are
acknowledged, the parties agree as follows:

     1.  Assignment. Assignor assigns to Assignee all of Assignor's interest in
         ----------
the Agreements, and shall warrant and forever defend such interest unto
Assignee, its successors and assigns, against every person whomsoever lawfully
claiming, or to claim the same, or any part thereof.

     2.  Assumption of Liabilities. Assignee assumes all of the obligations of
         -------------------------
the tenant under the Agreements arising on and after the date hereof.

                                   Exhibit G
             to Contribution, Conveyance and Assumption Agreement

                                      -1-
<PAGE>

     Executed on the date first written above.

ASSIGNOR:                          PENN VIRGINIA HOLDING CORP., a Virginia
                                   corporation

                                   By:__________________________________________
                                      A. James Dearlove, Chief Executive Officer

ASSIGNEE:                          PENN VIRGINIA OIL AND GAS CORPORATION, a
                                   Virginia corporation

                                   By:__________________________________________
                                      A. James Dearlove, Chief Executive Officer

                                   Exhibit G
             to Contribution, Conveyance and Assumption Agreement

                                      -2-<PAGE>

                                                                    EXHIBIT 10.4

                         PENN VIRGINIA RESOURCE GP, LLC
                            LONG-TERM INCENTIVE PLAN

SECTION 1. Purpose of the Plan.
           -------------------

     The Penn Virginia Resource GP, LLC Long-Term Incentive Plan (the "Plan") is
intended to promote the interests of Penn Virginia Resource Partners, L.P., a
Delaware limited partnership (the "Partnership"), by providing to employees and
directors of Penn Virginia Resource GP, LLC (the "Company") and its Affiliates
who perform services for the Partnership incentive compensation awards for
superior performance that are based on Units. The Plan is also contemplated to
enhance the ability of the Company and its Affiliates to attract and retain the
services of individuals who are essential for the growth and profitability of
the Partnership and to encourage them to devote their best efforts to the
business of the Partnership, thereby advancing the interests of the Partnership
and its partners.

SECTION 2. Definitions.
           -----------

     As used in the Plan, the following terms shall have the meanings set forth
below:

     "Affiliate" means, with respect to any Person, any other Person that
directly or indirectly through one or more intermediaries controls, is
controlled by or is under common control with, the Person in question. As used
herein, the term "control" means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of a
Person, whether through ownership of voting securities, by contract or
otherwise.

     "Award" means an Option, Restricted Unit or Phantom Unit granted under the
Plan, and shall include any tandem DERs granted with respect to a Phantom Unit.

     "Board" means the Board of Directors of the Company.

     "Change in Control" shall be deemed to have occurred upon the occurrence of
one or more of the following events: (i) any sale, lease, exchange or other
transfer (in one or a series of related transactions) of all or substantially
all of the assets of the Partnership or the Company to any Person or its
Affiliates, other than the Partnership, the Company or any of their Affiliates,
(ii) any merger, reorganization, consolidation or other transaction pursuant to
which more than 50% of the combined voting power of the equity interests in the
Company ceases to be owned by Persons who own such interests as of __________,
2001, (iii) a "change of control" of Penn Virginia Corporation, as provided in
its stock option plan, or (iv) the general partner (whether the Company or any
other Person) of the Partnership ceases to be an Affiliate of Penn Virginia
Corporation.

     "Committee" means the Compensation Committee of the Board or such other
committee of the Board appointed by the Board to administer the Plan.

     "DER" means a contingent right, granted in tandem with a specific Phantom
Unit, to receive an amount in cash equal to the cash distributions made by the
Partnership with respect to a Unit during the period such Phantom Unit is
outstanding.
<PAGE>

     "Director" means a member of the Board who is not an Employee.

     "Employee" means any employee of the Company or an Affiliate who performs
services for the Partnership, as determined by the Committee.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     "Fair Market Value" means the closing sales price of a Unit on the
applicable date (or if there is no trading in the Units on such date, on the
next preceding date on which there was trading) as reported in The Wall Street
Journal (or other reporting service approved by the Committee). In the event
Units are not publicly traded at the time a determination of fair market value
is required to be made hereunder, the determination of fair market value shall
be made in good faith by the Committee.

     "Option" means an option to purchase Units granted under the Plan.

     "Participant" means any Employee or Director granted an Award under the
Plan.

     "Partnership Agreement" means the Amended and Restated Agreement of Limited
Partnership of Penn Virginia Resource Partners, L.P.

     "Person" means an individual or a corporation, limited liability company,
partnership, joint venture, trust, unincorporated organization, association,
government agency or political subdivision thereof or other entity.

     "Phantom Unit" means a phantom (notional) Unit granted under the Plan which
upon vesting entitles the Participant to receive a Unit or an amount of cash
equal to the Fair Market Value of a Unit, whichever is determined by the
Committee.

     "Restricted Period" means the period established by the Committee with
respect to an Award during which the Award remains subject to forfeiture or is
not exercisable by or payable to the Participant; provided, however, the
Restricted Period with respect to any Award may not terminate prior to the end
of the Subordination Period (as defined in the Partnership Agreement) except (i)
at the same time and in the same proportion as subordinated units are converted
into Common Units, and (ii) upon a Change in Control.

     "Restricted Unit" means a Unit granted under the Plan that remains subject
to a Restricted Period.

     "Rule 16b-3" means Rule 16b-3 promulgated by the SEC under the Exchange
Act, or any successor rule or regulation thereto as in effect from time to time.

     "SEC" means the Securities and Exchange Commission, or any successor
thereto.

     "Unit" means a Common Unit of the Partnership.

                                      -2-
<PAGE>

SECTION 3. Administration.
           --------------

     The Plan shall be administered by the Committee. A majority of the
Committee shall constitute a quorum, and the acts of the members of the
Committee who are present at any meeting thereof at which a quorum is present,
or acts unanimously approved by the members of the Committee in writing, shall
be the acts of the Committee. Subject to the following and any applicable law,
the Committee, in its sole discretion, may delegate any or all of its powers and
duties under the Plan (provided the Chief Executive Officer is a member of the
Board), including the power to grant Awards under the Plan, to the Chief
Executive Officer of the Company, subject to such limitations on such delegated
powers and duties as the Committee may impose, if any. Upon any such delegation
all references in the Plan to the "Committee", other than in Section 7, shall be
deemed to include the Chief Executive Officer; provided, however, that such
delegation shall not limit the Chief Executive Officer's right to receive Awards
under the Plan. Notwithstanding the foregoing, the Chief Executive Officer may
not grant Awards to, or take any action with respect to any Award previously
granted to, a person who is an officer subject to Rule 16b-3 or a member of the
Board. Subject to the terms of the Plan and applicable law, and in addition to
other express powers and authorizations conferred on the Committee by the Plan,
the Committee shall have full power and authority to: (i) designate
Participants; (ii) determine the type or types of Awards to be granted to a
Participant; (iii) determine the number of Units to be covered by Awards; (iv)
determine the terms and conditions of any Award; (v) determine whether, to what
extent, and under what circumstances Awards may be settled, exercised, canceled,
or forfeited; (vi) interpret and administer the Plan and any instrument or
agreement relating to an Award made under the Plan; (vii) establish, amend,
suspend, or waive such rules and regulations and appoint such agents as it shall
deem appropriate for the proper administration of the Plan; and (viii) make any
other determination and take any other action that the Committee deems necessary
or desirable for the administration of the Plan. Unless otherwise expressly
provided in the Plan, all designations, determinations, interpretations, and
other decisions under or with respect to the Plan or any Award shall be within
the sole discretion of the Committee, may be made at any time and shall be
final, conclusive, and binding upon all Persons, including the Company, the
Partnership, any Affiliate, any Participant, and any beneficiary of any Award.

SECTION 4. Units.
           -----

     (a) Units Available. Subject to adjustment as provided in Section 4(c), the
         ---------------
number of Units with respect to which Awards may be granted under the Plan is
300,000. If any Option, Restricted Unit or Phantom Unit is forfeited or
otherwise terminates or is canceled without the delivery of Units, then the
Units covered by such Award, to the extent of such forfeiture, termination or
cancellation, shall again be Units with respect to which Awards may be granted.

     (b) Sources of Units Deliverable Under Awards. Any Units delivered pursuant
         -----------------------------------------
to an Award shall consist, in whole or in part, of Units acquired in the open
market, from any Affiliate, the Partnership or any other Person, or any
combination of the foregoing, as determined by the Committee in its discretion.

                                      -3-
<PAGE>

     (c) Adjustments. In the event that the Committee determines that any
         -----------
distribution (whether in the form of cash, Units, other securities, or other
property), recapitalization, split, reverse split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase, or exchange of Units
or other securities of the Partnership, issuance of warrants or other rights to
purchase Units or other securities of the Partnership, or other similar
transaction or event affects the Units such that an adjustment is determined by
the Committee to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan,
then the Committee shall, in such manner as it may deem equitable, adjust any or
all of (i) the number and type of Units (or other securities or property) with
respect to which Awards may be granted, (ii) the number and type of Units (or
other securities or property) subject to outstanding Awards, and (iii) the grant
or exercise price with respect to any Award or, if deemed appropriate, make
provision for a cash payment to the holder of an outstanding Award; provided,
that the number of Units subject to any Award shall always be a whole number.

SECTION 5. Eligibility.
           -----------

     Any Employee shall be eligible to be designated a Participant and receive
an Award under the Plan. A Director shall receive automatic grants of Restricted
Units as provided in Section 6(c), but shall not be eligible to receive any
other Award under the Plan.

SECTION 6. Awards.
           ------

     (a) Options. The Committee shall have the authority to determine the
         -------
Employees to whom Options shall be granted, the number of Units to be covered by
each Option, the purchase price therefor and the conditions and limitations
applicable to the exercise of the Option, including the following terms and
conditions and such additional terms and conditions, as the Committee shall
determine, that are not inconsistent with the provisions of the Plan.

          (ii) Exercise Price. The purchase price per Unit purchasable under an
               --------------
     Option shall be determined by the Committee at the time the Option is
     granted and may be more or less than its Fair Market Value as of the date
     of grant.

          (ii) Time and Method of Exercise. The Committee shall determine the
               ---------------------------
     Restricted Period, i.e., the time or times at which an Option may be
     exercised in whole or in part, which may include, without limitation,
     accelerated vesting upon the achievement of specified performance goals,
     and the method or methods by which payment of the exercise price with
     respect thereto may be made or deemed to have been made, which may include,
     without limitation, cash, check acceptable to the Company, a
     "cashless-broker" exercise through procedures approved by the Company,
     other securities or other property, a recourse note from the Participant in
     a form acceptable to the Company, or any combination thereof, having a Fair
     Market Value on the exercise date equal to the relevant exercise price.

          (iii) Forfeiture. Except as otherwise provided in the terms of the
                ----------
     Option grant, upon termination of a Participant's employment with the
     Company and its Affiliates or membership on the Board, whichever is
     applicable, for any reason during the applicable Restricted Period, all
     Options shall be forfeited by the Participant. The Committee may, in

                                      -4-
<PAGE>

     its discretion, waive in whole or in part such forfeiture with respect to a
     Participant's Options.

     (b) Phantom Units. The Committee shall have the authority to determine the
         -------------
Employees to whom Phantom Units shall be granted, the number of Phantom Units to
be granted to each such Participant, the Restricted Period, the conditions under
which the Phantom Units may become vested or forfeited, which may include,
without limitation, the accelerated vesting upon the achievement of specified
performance goals, and such other terms and conditions as the Committee may
establish with respect to such Awards, including whether DERs are granted with
respect to such Phantom Units.

          (i) DERs. To the extent provided by the Committee, in its discretion,
              ----
     a grant of Phantom Units may include a tandem DER grant, which may provide
     that such DERs shall be paid directly to the Participant, be credited to a
     bookkeeping account (with or without interest in the discretion of the
     Committee) subject to the same vesting restrictions as the tandem Award, or
     be subject to such other provisions or restrictions as determined by the
     Committee in its discretion. Notwithstanding the foregoing however, DERs
     shall not be granted with respect to any Award prior to the end of the
     Subordination Period (as defined in the Partnership Agreement).

          (ii) Forfeiture. Except as otherwise provided in the terms of the
               ----------
     Phantom Units grant, upon termination of a Participant's employment with
     the Company and its Affiliates or membership on the Board, whichever is
     applicable, for any reason during the applicable Restricted Period, all
     Phantom Units shall be forfeited by the Participant. The Committee may, in
     its discretion, waive in whole or in part such forfeiture with respect to a
     Participant's Phantom Units.

          (iii) Lapse of Restrictions. Upon or as soon as reasonably practical
                ---------------------
     following the vesting of each Phantom Unit, the Participant shall be
     entitled to receive from the Company one Unit or cash equal to the Fair
     Market Value of a Unit, as determined by the Committee in its discretion.

     (c) Restricted Units. The Committee shall have the authority to determine
         ----------------
the Employees to whom Restricted Units shall be granted, the number of
Restricted Units to be granted to each such Participant, the Restricted Period,
the conditions under which the Restricted Units may become vested or forfeited,
which may include, without limitation, the accelerated vesting upon the
achievement of specified performance goals, and such other terms and conditions
as the Committee may establish with respect to such Awards. On the effective
date of the initial public offering of Units ("IPO Date"), each person who is a
Director on such date shall receive a grant of 3,000 Restricted Units. Each
person who first becomes a Director after the IPO Date shall receive a grant of
3,000 Restricted Units on the date such person becomes a Director. On the first
business day of each calendar year, each person who is a Director on such date
shall receive a grant of      Restricted Units. The Restricted Period, vesting
and other terms of such automatic Director grants shall be established from time
to time by the Committee.

                                      -5-
<PAGE>

          (i) Forfeiture. Except as otherwise provided in the terms of the
              ----------
     Restricted Units grant, upon termination of a Participant's employment with
     the Company and its Affiliates or membership on the Board, whichever is
     applicable, for any reason during the applicable Restricted Period, all
     Restricted Units shall be forfeited by the Participant. The Committee may,
     in its discretion, waive in whole or in part such forfeiture with respect
     to a Participant's Restricted Units.

          (ii) Lapse of Restrictions. Upon or as soon as reasonably practical
               ---------------------
     following the vesting of each Restricted Unit, the Participant shall be
     entitled to receive from the Company one Unit that is not subject to a
     Restricted Period.

          (iii) Distributions. As provided by the Committee, in its discretion,
                -------------
     in a grant of Restricted Units, distributions on a Restricted Unit may be
     paid directly to the Participant or may be made subject to a risk of
     forfeiture and transfer restrictions during the Restricted Period, in which
     event such distributions shall be held, without interest, by the Company
     and paid to the Participant upon the vesting of the related Restricted Unit
     or forfeited upon the forfeiture of the related Restricted Unit, as the
     case may be.

     (d) General.
         -------

          (i) Awards May Be Granted Separately or Together. Awards may, in the
              --------------------------------------------
     discretion of the Committee, be granted either alone or in addition to, in
     tandem with, or in substitution for any other Award granted under the Plan
     or any award granted under any other plan of the Company or any Affiliate.
     Awards granted in addition to or in tandem with other Awards or awards
     granted under any other plan of the Company or any Affiliate may be granted
     either at the same time as or at a different time from the grant of such
     other Awards or awards.

          (ii) Limits on Transfer of Awards.
               ----------------------------

               (A) Except as provided in (C) below, each Option shall be
          exercisable only by the Participant during the Participant's lifetime,
          or by the person to whom the Participant's rights shall pass by will
          or the laws of descent and distribution.

               (B) Except as provided in (C) below, no Award and no right under
          any such Award may be assigned, alienated, pledged, attached, sold or
          otherwise transferred or encumbered by a Participant and any such
          purported assignment, alienation, pledge, attachment, sale, transfer
          or encumbrance shall be void and unenforceable against the Company or
          any Affiliate.

               (C) To the extent specifically provided by the Committee with
          respect to an Option grant, an Option may be transferred by a
          Participant without consideration to immediate family members or
          related family trusts, limited partnerships or similar entities or on
          such terms and conditions as the Committee may from time to time
          establish. In addition, Awards may be transferred by will and the laws
          of descent and distribution.

                                      -6-
<PAGE>

          (iii) Term of Awards. The term of each Award shall be for such period
                --------------
     as may be determined by the Committee.

          (iv) Unit Certificates. All certificates for Units or other securities
               -----------------
     of the Partnership delivered under the Plan pursuant to any Award or the
     exercise thereof shall be subject to such stop transfer orders and other
     restrictions as the Committee may deem advisable under the Plan or the
     rules, regulations, and other requirements of the SEC, any stock exchange
     upon which such Units or other securities are then listed, and any
     applicable federal or state laws, and the Committee may cause a legend or
     legends to be put on any such certificates to make appropriate reference to
     such restrictions.

          (v) Consideration for Grants. Awards may be granted for such
              ------------------------
     consideration, including services, as the Committee determines.

          (vi) Delivery of Units or other Securities and Payment by Participant
               ----------------------------------------------------------------
     of Consideration. Notwithstanding anything in the Plan or any grant
     ----------------
     agreement to the contrary, delivery of Units pursuant to the exercise or
     vesting of an Award may be deferred for any period during which, in the
     good faith determination of the Committee, the Company is not reasonably
     able to obtain Units to deliver pursuant to such Award without violating
     the rules or regulations of any applicable law or securities exchange. No
     Units or other securities shall be delivered pursuant to any Award until
     payment in full of any amount required to be paid pursuant to the Plan or
     the applicable Award grant agreement (including, without limitation, any
     exercise price or tax withholding) is received by the Company. Such payment
     may be made by such method or methods and in such form or forms as the
     Committee shall determine, including, without limitation, cash, other
     Awards, withholding of Units, cashless-broker exercises with simultaneous
     sale, or any combination thereof; provided that the combined value, as
     determined by the Committee, of all cash and cash equivalents and the Fair
     Market Value of any such Units or other property so tendered to the
     Company, as of the date of such tender, is at least equal to the full
     amount required to be paid to the Company pursuant to the Plan or the
     applicable Award agreement.

          (vii) Change in Control. Upon a Change in Control or such period prior
                -----------------
     thereto as may be established by the Committee, all Awards shall
     automatically vest and become payable or exercisable, as the case may be,
     in full. In this regard, all Restricted Periods shall terminate and all
     performance criteria, if any, shall be deemed to have been achieved at the
     maximum level. To the extent an Option is not exercised upon a Change in
     Control, the Committee may, in its discretion, cancel such Award without
     payment or provide for a replacement grant with respect to such property
     and on such terms as it deems appropriate.

SECTION 7. Amendment and Termination.
           -------------------------

     Except to the extent prohibited by applicable law:

     (a) Amendments to the Plan. Except as required by the rules of the
         ----------------------
principal securities exchange on which the Units are traded and subject to
Section 7(b) below, the Board or the Committee may amend, alter, suspend,
discontinue, or terminate the Plan in any manner, including

                                      -7-
<PAGE>

increasing the number of Units available for Awards under the Plan, without the
consent of any partner, Participant, other holder or beneficiary of an Award, or
other Person; provided, however, that no amendment to the Plan may be made
without the approval of a Unit Majority (as defined in the Partnership
Agreement) that would either (i) accelerate vesting to prior to the end of the
Subordination Period, except as provided in the current definition of Restricted
Period, or (ii) permit DERs to be granted prior to the end of the Subordination
Period.

     (b) Amendments to Awards. Subject to Section 7(a), the Committee may waive
         --------------------
any conditions or rights under, amend any terms of, or alter any Award
theretofore granted, provided no change, other than pursuant to Section 7(c), in
any Award shall materially reduce the benefit to a Participant without the
consent of such Participant.

     (c) Adjustment of Awards Upon the Occurrence of Certain Unusual or
         --------------------------------------------------------------
Nonrecurring Events. The Committee is hereby authorized to make adjustments in
-------------------
the terms and conditions of, and the criteria included in, Awards in recognition
of unusual or nonrecurring events (including, without limitation, the events
described in Section 4(c) of the Plan) affecting the Partnership or the
financial statements of the Partnership, or of changes in applicable laws,
regulations, or accounting principles, whenever the Committee determines that
such adjustments are appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan.

SECTION 8. General Provisions.
           ------------------

     (a) No Rights to Award. No Person shall have any claim to be granted any
         ------------------
Award under the Plan, and there is no obligation for uniformity of treatment of
Participants. The terms and conditions of Awards need not be the same with
respect to each recipient.

     (b) Withholding. The Company or any Affiliate is authorized to withhold
         -----------
from any Award, from any payment due or transfer made under any Award or from
any compensation or other amount owing to a Participant the amount (in cash,
Units, other securities, Units that would otherwise be issued pursuant to such
Award or other property) of any applicable taxes payable in respect of the grant
of an Award, its exercise, the lapse of restrictions thereon, or any payment or
transfer under an Award or under the Plan and to take such other action as may
be necessary in the opinion of the Company to satisfy its withholding
obligations for the payment of such taxes.

     (c) No Right to Employment. The grant of an Award shall not be construed as
         ----------------------
giving a Participant the right to be retained in the employ of the Company or
any Affiliate or to remain on the Board, as applicable. Further, the Company or
an Affiliate may at any time dismiss a Participant from employment, free from
any liability or any claim under the Plan, unless otherwise expressly provided
in the Plan or in any Award agreement.

     (d) Governing Law. The validity, construction, and effect of the Plan and
         -------------
any rules and regulations relating to the Plan shall be determined in accordance
with the laws of the State of Delaware law without regard to its conflict of
laws principles.

                                      -8-
<PAGE>

     (e) Severability. If any provision of the Plan or any award is or becomes
         ------------
or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as
to any Person or Award, or would disqualify the Plan or any award under any law
deemed applicable by the Committee, such provision shall be construed or deemed
amended to conform to the applicable laws, or if it cannot be construed or
deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan or the Award, such provision shall be stricken
as to such jurisdiction, person or award and the remainder of the Plan and any
such Award shall remain in full force and effect.

     (f) Other Laws. The Committee may refuse to issue or transfer any Units or
         ----------
other consideration under an Award if, in its sole discretion, it determines
that the issuance or transfer or such Units or such other consideration might
violate any applicable law or regulation, the rules of the principal securities
exchange on which the Units are then traded, or entitle the Partnership or an
Affiliate to recover the same under Section 16(b) of the Exchange Act, and any
payment tendered to the Company by a Participant, other holder or beneficiary in
connection with the exercise of such Award shall be promptly refunded to the
relevant Participant, holder or beneficiary.

     (g) No Trust or Fund Created. Neither the Plan nor any Award shall create
         ------------------------
or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any participating Affiliate and a
Participant or any other Person. To the extent that any Person acquires a right
to receive payments from the Company or any participating Affiliate pursuant to
an award, such right shall be no greater than the right of any general unsecured
creditor of the Company or any participating Affiliate.

     (h) No Fractional Units. No fractional Units shall be issued or delivered
         -------------------
pursuant to the Plan or any Award, and the Committee shall determine whether
cash, other securities, or other property shall be paid or transferred in lieu
of any fractional Units or whether such fractional Units or any rights thereto
shall be canceled, terminated, or otherwise eliminated.

     (i) Headings. Headings are given to the Sections and subsections of the
         --------
Plan solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.

     (j) Facility Payment. Any amounts payable hereunder to any person under
         ----------------
legal disability or who, in the judgment of the Committee, is unable to properly
manage his financial affairs, may be paid to the legal representative of such
person, or may be applied for the benefit of such person in any manner which the
Committee may select, and the Company shall be relieved of any further liability
for payment of such amounts.

     (k) Gender and Number. Words in the masculine gender shall include the
         -----------------
feminine gender, the plural shall include the singular and the singular shall
include the plural.

SECTION 9. Term of the Plan.
           ----------------

     The Plan shall be effective on the date of its approval by the Board and
shall continue until the date terminated by the Board or Units are no longer
available for the payment of Awards under the Plan, whichever occurs first.
However, unless otherwise expressly provided in the Plan or in an

                                      -9-
<PAGE>

applicable Award Agreement, any Award granted prior to such termination, and the
authority of the Board or the Committee to amend, alter, adjust, suspend,
discontinue, or terminate any such Award or to waive any conditions or rights
under such Award, shall extend beyond such termination date.

                                      -10-

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