Document:

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                                  EXHIBIT (II)

                        DRILLING AND OPERATING AGREEMENT
                  ATLAS-ENERGY FOR THE NINETIES-PUBLIC #8 LTD.

          (THIS DRILLING AND OPERATING AGREEMENT WILL BE APPROPRIATELY
                 MODIFIED FOR OTHER AREAS OF THE UNITED STATES.)

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<TABLE>
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                                      INDEX

SECTION                                                                                                        PAGE
<S>   <C>                                                                                                      <C>

1.    Assignment of Well Locations; Representations; Designation of Additional Well Locations;
        Outside Activities........................................................................................1

2.    Drilling of Wells; Interest of Developer;  Right of Substitution............................................2

3.    Operator - Responsibilities in General; Term................................................................3

4.    Operator's Charges for Drilling and Completing Wells; Completion Determination..............................4

5.    Title Examination of Well Locations; Liability for Title Defects............................................5

6.    Operations Subsequent to Completion of the Wells; Price Determinations; Plugging and Abandonment............5

7.    Billing and Payment Procedure with Respect to Operation of Wells; Records, Reports and Information..........7

8.    Operator's Lien.............................................................................................8

9.    Successors and Assigns; Transfers; Appointment of Agent.....................................................8

10.   Insurance; Operator's Liability.............................................................................9

11.   Internal Revenue Code Election, Relationship of Parties; Right to Take Production in Kind...................9

12.   Force Majeure..............................................................................................10

13.   Term.......................................................................................................10

14.   Governing Law and Invalidity...............................................................................11

15.   Integration................................................................................................11

16.   Waiver of Default or Breach................................................................................11

17.   Notices....................................................................................................11

18.   Interpretation.............................................................................................11

19.   Counterparts...............................................................................................12

      Signature Page.............................................................................................12

      Exhibit A                          Description of Leases and Initial Well Locations
      Exhibits A-l through A-___         Maps of Initial Well Locations
      Exhibit B                          Form of Assignment
      Exhibit C                          Form of Addendum

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                        DRILLING AND OPERATING AGREEMENT

     THIS AGREEMENT made this 3rd day of December, 1999, by and between ATLAS
RESOURCES, INC., a Pennsylvania corporation (hereinafter referred to as
"Atlas" or "Operator"),

                                       and

ATLAS-ENERGY FOR THE NINETIES-PUBLIC #8 LTD., a Pennsylvania limited
partnership, (hereinafter referred to as the "Developer").

                                WITNESSETH THAT:

WHEREAS, the Operator, by virtue of the Oil and Gas Leases (the "Leases")
described on Exhibit A attached hereto and made a part hereof, has certain
rights to develop the five (5) initial well locations identified on the maps
attached hereto as Exhibits A-l through A-5 (the "Initial Well Locations");

WHEREAS, the Developer, subject to the terms and conditions hereof, desires
to acquire certain of the Operator's rights to develop the aforesaid five (5)
Initial Well Locations and to provide for the development upon the terms and
conditions herein set forth of additional well locations ("Additional Well
Locations") which the parties may from time to time designate; and

WHEREAS, the Operator is in the oil and gas exploration and development
business, and the Developer desires that Operator, as its independent
contractor, perform certain services in connection with its efforts to develop
the aforesaid Initial and Additional Well Locations (hereinafter collectively
referred to as the "Well Locations") and to operate the wells completed
thereon, on the terms and conditions herein set forth;

NOW THEREFORE, in consideration of the mutual covenants herein contained and
subject to the terms and conditions hereinafter set forth, the parties hereto,
intending to be legally bound, hereby agree as follows:

     1.  ASSIGNMENT OF WELL LOCATIONS; REPRESENTATIONS; DESIGNATION OF
ADDITIONAL WELL LOCATIONS; OUTSIDE ACTIVITIES.

         (a) The Operator shall execute an assignment of an undivided
percentage of Working Interest in the Well Location acreage for each well to
the Developer as shown on Exhibit A attached hereto, which assignment shall be
limited to a depth from the surface to the top of the Queenston formation in
Pennsylvania and Ohio.

         The assignment shall be substantially in the form of Exhibit B
attached hereto and made a part hereof. The amount of acreage included in
each Initial Well Location and the configuration thereof are indicated on the
maps attached hereto as Exhibits A-l through A-5. The amount of acreage
included in each Additional Well Location and the configuration thereof shall
be indicated on the maps to be attached as exhibits to the applicable
addendum as provided in sub-section (c) below.

         (b) As of the date hereof, the Operator represents and warrants to
the Developer that the Operator is the lawful owner of said Lease and rights
and interest thereunder and of the personal property thereon or used in
connection therewith; that the Operator has good right and authority to sell
and convey the same, and that said rights, interest and property are free and
clear from all liens and encumbrances, and that all rentals and royalties due
and payable thereunder have been duly paid. The foregoing representations and
warranties shall also be made by the Operator at the time of each recorded
assignment of the acreage included in each Initial Well Location and at the
time of each recorded assignment of the acreage included in each Additional
Well Location designated pursuant to sub-section (c) below, such
representations and warranties to be included in each recorded assignment
substantially in the manner set forth in the form of assignment attached
hereto and made a part hereof as Exhibit B. The Operator agrees to indemnify,
protect and hold the Developer and its successors and assigns harmless from
and against all costs (including but not limited to reasonable attorneys'
fees), liabilities, claims, penalties, losses, suits, actions, causes of
action, judgments or decrees resulting from the breach of any of the aforesaid
representations and warranties. It is understood and agreed that, except as
specifically set forth above, the Operator makes no warranty or
representation, express or implied, as to its title or the title of the
lessors in and to the lands or oil and gas interests covered by said Leases.

         (c) In the event that the parties hereto desire to designate
Additional Well Locations to be developed in accordance with the terms and
conditions of this Agreement, each of said parties shall execute an addendum
substantially in the form of

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Exhibit C attached hereto and made a part hereof specifying the undivided
percentage of Working Interest and the Oil and Gas Leases to be included as
Leases hereunder, specifying the amount and configuration of acreage included
in each such Additional Well Location on maps attached as exhibits to such
addendum and setting forth their agreement that such Additional Well Locations
shall be developed in accordance with the terms and conditions of this
Agreement.

         (d) It is understood and agreed that the assignment of rights under
the Leases and the oil and gas development activities contemplated by this
Agreement relate only to the Initial Well Locations described herein and to
the Additional Well Locations designated pursuant to sub-section (c) above.
Nothing contained in this Agreement shall be interpreted to restrict in any
manner the right of each of the parties hereto to conduct without the
participation of any other party hereto any additional activities relating to
exploration, development, drilling, production or delivery of oil and gas on
lands adjacent to or in the immediate vicinity of the aforesaid Initial and
Additional Well Locations or elsewhere.

     2.  DRILLING OF WELLS; INTEREST OF DEVELOPER; RIGHT OF SUBSTITUTION.

         (a) Operator, as Developer's independent contractor, agrees to
drill, complete (or plug) and operate five (5) natural gas wells on the five
(5) Initial Well Locations in accordance with the terms and conditions of
this Agreement. Developer, as a minimum commitment, agrees to participate in
and pay the Operator's charges for drilling and completing the wells and any
extra costs pursuant to Section 4 hereof in proportion to the share of the
Working Interest owned by the Developer in the wells with respect to all five
(5) initial wells, it being expressly understood and agreed that, subject to
sub-section (e) below, Developer does not reserve the right to decline
participation in the drilling of any of the five (5) initial wells to be
drilled hereunder.

         (b) Operator will use its best efforts to commence drilling the
first well within thirty (30) days after the date of this Agreement and to
commence the drilling of each of said five (5) initial wells for which
payment is made pursuant to Section 4(b) of this Agreement, on or before
March 30, 2000. Subject to the foregoing time limits, Operator shall
determine the timing of and the order of the drilling of said five (5)
Initial Well Locations.

         (c) The five (5) initial wells to be drilled on the Initial Well
Locations designated pursuant to this Agreement and any additional wells
drilled hereunder on any Additional Well Locations designated pursuant to
Section l(c) above shall be drilled and completed (or plugged) in accordance
with the generally accepted and customary oil and gas field practices and
techniques then prevailing in the geographical area of the Well Locations and
shall be drilled to a depth sufficient to test thoroughly the objective
formation or the deepest assigned depth, whichever is less.

         (d) Except as otherwise provided herein, all costs, expenses and
liabilities incurred in connection with the drilling and other operations and
activities contemplated by this Agreement shall be borne and paid, and all
wells, gathering lines of up to approximately 1,500 feet on the Prospect,
equipment, materials, and facilities acquired, constructed or installed
hereunder shall be owned, by the Developer in proportion to the share of the
Working Interest owned by the Developer in the wells. Subject to the payment
of lessor's royalties and other royalties and overriding royalties, if any,
production of oil and gas from the wells to be drilled hereunder shall be
owned by the Developer in proportion to the share of the Working Interest
owned by the Developer in the wells.

         (e) Notwithstanding the provisions of sub-section (a) above, in the
event the Operator or Developer determines in good faith, with respect to any
Well Location, before operations commence hereunder with respect to such Well
Location, based upon the production (or failure of production) of any other
wells which may have been recently drilled in the immediate area of such Well
Location, or upon newly discovered title defects, or upon such other evidence
with respect to the Well Location as may be obtained, that it would not be in
the best interest of the parties hereto to drill a well on such Well Location,
then the party making the determination shall notify the other party hereto of
such determination and the basis therefor and, unless otherwise instructed by
Developer, such well shall not be drilled.

         If such well is not drilled, Operator shall promptly propose a new
well location (including such information with respect thereto as Developer
may reasonably request) within Pennsylvania, Ohio, or other areas of the
Appalachian Basin to be substituted for such original Well Location. Developer
shall thereafter have the option for a period of seven (7) business days to
either reject or accept the proposed new well location. If the new well
location is rejected, Operator shall promptly propose another substitute well
location pursuant to the provisions hereof.

         Once the Developer accepts a substitute well location or does not
reject it within said seven (7) day period, this Agreement shall terminate as
to the original Well Location and the substitute well location shall become
subject to the terms and conditions hereof.

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     3.  OPERATOR - RESPONSIBILITIES IN GENERAL; TERM.

         (a)  Atlas shall be the Operator of the wells and Well Locations
subject to this Agreement and, as the Developer's independent contractor,
shall, in addition to its other obligations hereunder:

              (i)    make the necessary arrangements for the drilling and
                     completion of wells and the installation of the necessary
                     gas gathering line systems and connection facilities;

              (ii)   make the technical decisions required in drilling,
                     testing, completing and operating such wells;

              (iii)  manage and conduct all field operations in connection with
                     the drilling, testing, completing, equipping, operating
                     and producing of the wells;

              (iv)   maintain all wells, equipment, gathering lines and
                     facilities in good working order during the useful life
                     thereof; and

              (v)    perform the necessary administrative and accounting
                     functions.

         In the performance of work contemplated by this Agreement, Operator
is an independent contractor with authority to control and direct the
performance of the details of the work.

         (b)  Operator covenants and agrees that:

              (i)    it shall perform and carry on (or cause to be performed
                     and carried on) its duties and obligations hereunder in
                     a good, prudent, diligent and workmanlike manner using
                     technically sound, acceptable oil and gas field practices
                     then prevailing in the geographical area of the aforesaid
                     Well Locations;

              (ii)   all drilling and other operations conducted by, for and
                     under the control of Operator hereunder shall conform in
                     all respects to federal, state and local laws, statutes,
                     ordinances, regulations, and requirements;

              (iii)  unless otherwise agreed in writing by the Developer, all
                     work performed hereunder pursuant to a written estimate
                     shall conform to the technical specifications set forth in
                     such written estimate and all equipment and materials
                     installed or incorporated in the wells and facilities
                     hereunder shall be new or used and of good quality;

              (iv)   in the course of conducting operations hereunder, it shall
                     comply with all terms and conditions of the Leases (and
                     any related assignments, amendments, subleases,
                     modifications and supplements) other than any minimum
                     drilling commitments contained therein;

              (v)    it shall keep the Well Locations subject to this Agreement
                     and all wells, equipment and facilities located thereon,
                     free and clear of all labor, materials and other liens or
                     encumbrances arising out of operations hereunder;

              (vi)   it shall file all reports and obtain all permits and bonds
                     required to be filed with or obtained from any
                     governmental authority or agency in connection with the
                     drilling or other operations and activities which are the
                     subject of this Agreement; and

              (vii)  it will provide competent and experienced personnel to
                     supervise the drilling, completing (or plugging), and
                     operating of the wells and use the services of competent
                     and experienced service companies to provide any third
                     party services necessary or appropriate in order to
                     perform its duties hereunder.

         (c)  Atlas shall serve as Operator hereunder until the earliest of:

              (i)    the termination of this Agreement pursuant to Section 13
                     hereof;

              (ii)   the termination of Atlas as Operator by the Developer
                     which may be effected by the Developer at any time in its
                     discretion, with or without cause; upon sixty (60) days
                     advance written notice to the Operator;

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                     or

              (iii)  the resignation of Atlas as Operator hereunder which may
                     occur upon ninety (90) days' written notice to the
                     Developer at any time after five (5) years from the date
                     hereof, it being expressly understood and agreed that
                     Atlas shall have no right to resign as Operator hereunder
                     prior to the expiration of the aforesaid five-year period.

Any successor Operator hereunder shall be selected by the Developer. Nothing
contained in this sub-section (c) shall relieve or release Atlas or the
Developer from any liability or obligation hereunder which accrued or occurred
prior to Atlas' removal or resignation as Operator hereunder. Upon any change
in Operator pursuant to this provision, the then present Operator shall
deliver to the successor Operator possession of all records, equipment,
materials and appurtenances used or obtained for use in connection with
operations hereunder and owned by the Developer.

     4.  OPERATOR'S CHARGES FOR DRILLING AND COMPLETING WELLS; COMPLETION
DETERMINATION.

         (a)  All natural gas wells which are drilled and completed hereunder
shall be drilled and completed on a footage basis for a price of $37.81 per
foot to the depth of the well at its deepest penetration as recorded by
Operator. The aforesaid footage price for each of said natural gas wells shall
be set forth in an AFE which shall be attached to this Agreement as an
Exhibit, and shall cover all ordinary costs which may be incurred in drilling
and completing each such well for production of natural gas, including without
limitation, site preparation, permits and bonds, roadways, surface damages,
power at the site, water, Operator's overhead and profit, rights-of-way,
drilling rigs, equipment and materials, costs of title examination, logging,
cementing, fracturing, casing, meters (other than utility purchase meters),
connection facilities, salt water collection tanks, separators, siphon string,
rabbit, tubing, an average of 1,500 feet of gathering line per well,
geological and engineering services and completing two (2) zones. Such footage
price shall not include the cost of:

              (i)    completing more than two (2) zones;

              (ii)   completion procedures, equipment, or any facilities
                     necessary or appropriate for the production and sale of
                     oil and/or natural gas liquids; and

              (iii)  equipment or materials necessary or appropriate to
                     collect, lift or dispose of liquids for efficient gas
                     production, except that the cost of saltwater collection
                     tanks, separators, siphon string and tubing shall be
                     included in the aforesaid footage price.

         Any such extra costs shall be billed to Developer in proportion to
the share of the Working Interest owned by the Developer in the wells on a
direct cost basis equal to the sum of:

              (i)    Operator's invoice costs of third party services performed
                     and materials and equipment purchased plus ten percent
                     (10%) to cover supervisory services and overhead; and

              (ii)   Operator's standard charges for services performed
                     directly by it.

         (b)  In order to enable Operator to commence site preparation for
five (5) initial wells, to obtain suitable subcontractors for the drilling
and completion of such wells at currently prevailing prices, and to insure
the availability of equipment and materials, the Developer shall pay to
Operator, in proportion to the share of the Working Interest owned by the
Developer in the wells, one hundred percent (100%) of the estimated price for
all initial wells upon execution of this Agreement. The payment to be
nonrefundable in all events, except that Atlas' share of such payments as the
Managing General Partner of the Developer shall be paid within five (5)
business days of notice from Operator that such costs have been incurred.

         With respect to each additional well drilled on the Additional Well
Locations, if any, in order to enable Operator to commence site preparation,
to obtain suitable subcontractors for the drilling and completion of such
wells at currently prevailing prices, and to insure the availability of
equipment and materials, Developer shall pay Operator, in proportion to the
share of the Working Interest owned by the Developer in the wells, one hundred
percent (100%) of the estimated price for such well upon execution of the
applicable addendum pursuant to Section l(c) above. The payment shall be
nonrefundable in all events, except that Atlas' share of such payments as the
Managing General Partner of the Developer shall be paid within five (5)
business days of notice from Operator that such costs have been incurred.

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         Subject to the above, with respect to each well and each additional
well, Developer shall pay to Operator, in proportion to the share of the
Working Interest owned by the Developer in the wells, the designated
completion costs for such well within five (5) business days of receipt of
notice from Operator that such well has been drilled to the objective depth
and logged and is to be completed. Developer shall pay, in proportion to the
share of the Working Interest owned by the Developer in the wells, any extra
costs incurred with respect to each well pursuant to sub-section (a) above
within ten (10) business days of its receipt of Operator's statement therefor.

         (c) Operator shall determine whether or not to run the production
casing for an attempted completion or to plug and abandon any well drilled
hereunder; provided, however, that a well shall be completed only if Operator
has made a good faith determination that there is a reasonable possibility of
obtaining commercial quantities of oil and/or gas.

         (d) If Operator determines at any time during the drilling or
attempted completion of any well hereunder, in accordance with the generally
accepted and customary oil and gas field practices and techniques then
prevailing in the geographic area of the well location, that such well should
not be completed, it shall promptly and properly plug and abandon the same. In
such event, such well shall be deemed a dry hole and the dry hole footage
price for each well drilled hereunder shall be $20.60 per foot multiplied by
the depth of the well, as specified in sub-section (a) above, and shall be
charged to the Developer in proportion to the share of the Working Interest
owned by the Developer in the well. Any amounts paid by the Developer with
respect to such dry hole which exceed the aforesaid dry hole footage price
shall be retained by Operator and shall be applied to the costs for an
additional well or wells to be drilled on the Additional Well Locations.

     5.  TITLE EXAMINATION OF WELL LOCATIONS; LIABILITY FOR TITLE DEFECTS.

         (a) The Developer hereby acknowledges that Operator has furnished
Developer with the title opinions identified on Exhibit A, and other documents
and information which Developer or its counsel has requested in order to
determine the adequacy of the title to the Initial Well Locations and leased
premises subject to this Agreement. The Developer hereby accepts the title to
said Initial Well Locations and leased premises and acknowledges and agrees
that, except for any loss, expense, cost or liability caused by the breach of
any of the warranties and representations made by the Operator in Section l(b)
hereof, any loss, expense, cost or liability whatsoever caused by or related
to any defect or failure of such title shall be the sole responsibility of and
shall be borne entirely by the Developer.

         (b) Prior to commencing the drilling of any well on any Additional
Well Location designated pursuant to this Agreement, Operator shall conduct,
or cause to be conducted, a title examination of such Additional Well
Location, in order to obtain appropriate abstracts, opinions and certificates
and other information necessary to determine the adequacy of title to both the
applicable Lease and the fee title of the lessor to the premises covered by
such Lease. The results of such title examination and such other information
as is necessary to determine the adequacy of title for drilling purposes shall
be submitted to the Developer for its review and acceptance, and no drilling
shall be commenced until such title has been accepted in writing by the
Developer. After any title has been accepted by the Developer, any loss,
expense, cost or liability whatsoever, caused by or related to any defect or
failure of such title shall be the sole responsibility of and shall be borne
entirely by the Developer, unless such loss, expense, cost or liability was
caused by the breach of any of the warranties and representations made by the
Operator in Section l(b) of this Agreement.

     6.  OPERATIONS SUBSEQUENT TO COMPLETION OF THE WELLS; PRICE
DETERMINATIONS; PLUGGING AND ABANDONMENT.

         (a)  Commencing with the month in which a well drilled hereunder
begins to produce, Operator shall be entitled to an operating fee of $275 per
month for each well being operated under this Agreement, proportionately
reduced to the extent the Developer owns less than 100% of the Working
Interest in the wells. This fee shall be in lieu of any direct charges by
Operator for its services or the provision by Operator of its equipment for
normal superintendence and maintenance of such wells and related pipelines and
facilities. Such operating fees shall cover all normal, regularly recurring
operating expenses for the production, delivery and sale of natural gas,
including without limitation well tending, routine maintenance and adjustment,
reading meters, recording production, pumping, maintaining appropriate books
and records, preparing reports to the Developer and government agencies, and
collecting and disbursing revenues. The operating fees shall not cover costs
and expenses related to the:

              (i)    production and sale of oil;

              (ii)   collection and disposal of salt water or other liquids
                     produced by the wells;

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             (iii)  rebuilding of access roads; and

             (iv)   purchase of equipment, materials or third party services,
                    which, subject to the provisions of sub-section (c) of this
                    Section 6, shall be paid by the Developer in proportion to
                    the share of the Working Interest owned by the Developer in
                    the wells.

Any well which is temporarily abandoned or shut-in continuously for the entire
month shall not be considered a producing well for purposes of determining the
number of wells in such month subject to the aforesaid operating fee.

         (b) The monthly operating fee set forth in sub-section (a) above may
in the following manner be adjusted annually as of the first day of January
(the "Adjustment Date") each year beginning January 1, 2001. Such adjustment,
if any, shall not exceed the percentage increase in the average weekly
earnings of "Crude Petroleum, Natural Gas, and Natural Gas Liquids" workers,
as published by the U.S. Department of Labor, Bureau of Labor Statistics, and
shown in Employment and Earnings Publication, Monthly Establishment Data,
Hours and Earning Statistical Table C-2, Index Average Weekly Earnings of
"Crude Petroleum, Natural Gas, and Natural Gas Liquids" workers, SIC Code
#131-2, or any successor index thereto, since January 1, 1997, in the case of
the first adjustment, and since the previous Adjustment Date, in the case of
each subsequent adjustment.

         (c) Without the prior written consent of the Developer, pursuant to a
written estimate submitted by Operator, Operator shall not undertake any
single project or incur any extraordinary cost with respect to any well being
produced hereunder reasonably estimated to result in an expenditure of more
than $5,000, unless such project or extraordinary cost is necessary to
safeguard persons or property or to protect the well or related facilities in
the event of a sudden emergency. In no event, however, shall the Developer be
required to pay for any project or extraordinary cost arising from the
negligence or misconduct of Operator, its agents, servants, employees,
contractors, licensees or invitees.

         All extraordinary costs incurred and the cost of projects undertaken
with respect to a well being produced hereunder shall be billed at the invoice
cost of third party services performed or materials purchased together with a
reasonable charge by Operator for services performed directly by it, in
proportion to the share of the Working Interest owned by the Developer in the
wells. Operator shall have the right to require the Developer to pay in
advance of undertaking any such project all or a portion of the estimated
costs thereof in proportion to the share of the Working Interest owned by the
Developer in the wells.

         (d) Developer shall have no interest in the pipeline gathering
system, which gathering system shall remain the sole property of Operator and
shall be maintained at Operator's sole cost and expense.

         (e) Notwithstanding anything herein to the contrary, the Developer
shall have full responsibility for and bear all costs in proportion to the
share of the Working Interest owned by the Developer in the wells with respect
to obtaining price determinations under and otherwise complying with the
Natural Gas Policy Act of 1978 and the implementing state regulations. Such
responsibility shall include, without limitation, preparing, filing, and
executing all applications, affidavits, interim collection notices, reports
and other documents necessary or appropriate to obtain price certification, to
effect sales of natural gas, or otherwise to comply with said Act and the
implementing state regulations. Operator agrees to furnish such information
and render such assistance as the Developer may reasonably request in order to
comply with said Act and the implementing state regulations without charge for
services performed by its employees.

         (f) The Developer shall have the right to direct Operator to plug and
abandon any well which has been completed hereunder as a producer. In
addition, Operator shall not plug and abandon any such well prior to obtaining
the written consent of the Developer. However, if the Operator in accordance
with the generally accepted and customary oil and gas field practices and
techniques then prevailing in the geographic area of the well location,
determines that any such well should be plugged and abandoned and makes a
written request to the Developer for authority to plug and abandon any such
well and the Developer fails to respond in writing to such request within
forty-five (45) days following the date of such request, then the Developer
shall be deemed to have consented to the plugging and abandonment of such
well(s). All costs and expenses related to plugging and abandoning the wells
which have been drilled and completed as producing wells hereunder shall be
borne and paid by the Developer in proportion to the share of the Working
Interest owned by the Developer in the wells.

         At any time after three (3) years from the date each well drilled and
completed hereunder is placed into production, Operator shall have the right
to deduct each month from the proceeds of the sale of the production from the
well operated hereunder up to $200, in proportion to the share of the Working
Interest owned by the Developer in the wells, for the purpose of establishing
a fund to cover the estimated costs of plugging and abandoning said well. All
such funds shall be deposited in a separate interest bearing escrow account
for the account of the Developer, and the total amount so retained and
deposited shall not

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exceed Operator's reasonable estimate of such costs.

     7. BILLING AND PAYMENT PROCEDURE WITH RESPECT TO OPERATION OF WELLS;
RECORDS, REPORTS AND INFORMATION.

         (a) Operator shall promptly and timely pay and discharge on behalf of
the Developer, in proportion to the share of the Working Interest owned by the
Developer in the wells, all severance taxes, royalties, overriding royalties,
operating fees, pipeline gathering charges and other expenses and liabilities
payable and incurred by reason of its operation of the wells in accordance
with this Agreement. Operator shall also pay, in proportion to the share of
the Working Interest owned by the Developer in the wells, on or before the due
date any third party invoices rendered to Operator with respect to such costs
and expenses. Operator, however, shall not be required to pay and discharge as
aforesaid any such costs and expenses which are being contested in good faith
by Operator.

         Operator shall deduct the foregoing costs and expenses from the
Developer's share of the proceeds of the oil and/or gas sold from the wells
operated hereunder and shall keep an accurate record of the Developer's
account hereunder, showing expenses incurred and charges and credits made and
received with respect to each well. In the event that such proceeds are
insufficient to pay said costs and expenses, Operator shall promptly and
timely pay and discharge the same, in proportion to the share of the Working
Interest owned by the Developer in the wells, and prepare and submit an
invoice to the Developer each month for said costs and expenses. The invoice
shall be accompanied by the form of statement specified in sub-section (b)
below. Any such invoice shall be paid by the Developer within ten (10)
business days of its receipt.

         (b)  Operator shall disburse to the Developer, on a monthly basis,
the Developer's share of the proceeds received from the sale of oil and/or gas
sold from the wells operated hereunder, less:

              (i)   the amounts charged to the Developer under sub-section (a)
                    hereof; and

              (ii)  such amount, if any, withheld by Operator for future
                    plugging costs pursuant to sub-section (f) of Section 6.

Each such disbursement made and/or invoice submitted pursuant to sub-section (a)
above shall be accompanied by a statement itemizing with respect to each well:

              (i)   the total production of oil and/or gas since the date of
                    the last disbursement or invoice billing period, as the
                    case may be, and the Developer's share thereof;

              (ii)  the total proceeds received from any sale thereof, and the
                    Developer's share thereof;

              (iii) the costs and expenses deducted from said proceeds and/or
                    being billed to the Developer pursuant to sub-section (a)
                    above;

              (iv)  the amount withheld for future plugging costs; and

              (v)   such other information as Developer may reasonably request,
                    including without limitation copies of all third party
                    invoices listed thereon for such period.

Operator agrees to deposit all proceeds from the sale of oil and/or gas sold
from the wells operated hereunder in a separate checking account maintained by
Operator. This account shall be used solely for the purpose of collecting and
disbursing funds constituting proceeds from the sale of production hereunder.

         (c)  In addition to the statements required under sub-section (b)
above, Operator, within seventy-five (75) days after the completion of each
well drilled hereunder, shall furnish the Developer with a detailed statement
itemizing with respect to such well the total costs and charges under Section
4(a) hereof and the Developer's share thereof, and such information as is
necessary to enable the Developer:

              (i)   to allocate any extra costs incurred with respect to such
                    well between tangible and intangible; and

              (ii)  to determine the amount of investment tax credit, if
                    applicable.

         (d)  Upon request, Operator shall promptly furnish the Developer with
such additional information as it may reasonably request, including without
limitation geological, technical and financial information, in such form as
may reasonably

                                       7

<PAGE>

be requested, pertaining to any phase of the operations and activities
governed by this Agreement. The Developer and its authorized employees, agents
and consultants, including independent accountants shall, at Developer's sole
cost and expense:

              (i)   upon at least ten (10) days' written notice have access
                    during normal business hours to all of Operator's records
                    pertaining to operations hereunder, including without
                    limitation, the right to audit the books of account of
                    Operator relating to all receipts, costs, charges and
                    expenses under this Agreement; and

              (ii)  have access, at its sole risk, to any wells drilled by
                    Operator hereunder at all times to inspect and observe any
                    machinery, equipment and operations.

     8.  OPERATOR'S LIEN.

         (a)  The Developer hereby grants Operator a first and preferred lien
on and security interest in the interest of the Developer covered by this
Agreement, and in the Developer's interest in oil and gas produced and the
proceeds thereof, and upon the Developer's interest in materials and
equipment, to secure the payment of all sums due from Developer to Operator
under the provisions of this Agreement.

         (b) In the event that the Developer fails to pay any amount owing
hereunder by it to the Operator within the time limit for payment thereof,
Operator, without prejudice to other existing remedies, is authorized at its
election to collect from any purchaser or purchasers of oil or gas and retain
the proceeds from the sale of the Developer's share thereof until the amount
owed by the Developer, plus twelve percent (12%) interest on a per annum basis
and any additional costs (including without limitation actual attorneys' fees
and costs) resulting from such delinquency, has been paid. Each purchaser of
oil or gas shall be entitled to rely upon Operator's written statement
concerning the amount of any default.

     9.  SUCCESSORS AND ASSIGNS; TRANSFERS; APPOINTMENT OF AGENT.

         (a)  This Agreement shall be binding upon and shall inure to the
benefit of the undersigned parties and their respective successors and
permitted assigns; provided, however, that Operator may not assign, transfer,
pledge, mortgage, hypothecate, sell or otherwise dispose of any of its
interest in this Agreement, or any of the rights or obligations hereunder,
without the prior written consent of the Developer, except that such consent
shall not be required in connection with:

              (i)   the assignment of work to be performed for Operator by
                    subcontractors, it being understood and agreed, however,
                    that any such assignment to Operator's subcontractors shall
                    not in any manner relieve or release Operator from any of
                    its obligations and responsibilities under this Agreement;

              (ii)  any lien, assignment, security interest, pledge or mortgage
                    arising under or pursuant to Operator's present or future
                    financing arrangements, or

              (iii) the liquidation, merger, consolidation or sale of
                    substantially all of the assets of Operator or other
                    corporate reorganization.

Further, in order to maintain uniformity of ownership in the wells,
production, equipment, and leasehold interests covered by this Agreement, and
notwithstanding any other provisions to the contrary, the Developer shall not,
without the prior written consent of Operator, sell, assign, transfer,
encumber, mortgage or otherwise dispose of any of its interest in the wells,
production, equipment or leasehold interests covered hereby unless such
disposition encompasses either:

              (i)   the entire interest of the Developer in all wells,
                    production, equipment and leasehold interests subject
                    hereto; or

              (ii)  an equal undivided interest in all such wells, production,
                    equipment, and leasehold interests.

         (b)  Subject to the provisions of sub-section (a) above, any sale,
encumbrance, transfer or other disposition made by the Developer of its
interests in the wells, production, equipment, and/or leasehold interests
covered hereby shall be made:

              (i)   expressly subject to this Agreement;

                                       8

<PAGE>

              (ii)  without prejudice to the rights of the other party; and

              (iii) in accordance with and subject to the provisions of the
                    Lease.

         (c)  If at any time the interest of the Developer is divided among or
owned by co-owners, Operator may, at its discretion, require such co-owners to
appoint a single trustee or agent with full authority to receive notices,
reports and distributions of the proceeds from production, to approve
expenditures, to receive billings for and approve and pay all costs, expenses
and liabilities incurred hereunder, to exercise any rights granted to such
co-owners under this Agreement, to grant any approvals or authorizations
required or contemplated by this Agreement, to sign, execute, certify,
acknowledge, file and/or record any agreements, contracts, instruments,
reports, or documents whatsoever in connection with this Agreement or the
activities contemplated hereby, and to deal generally with, and with power to
bind, such co-owners with respect to all activities and operations
contemplated by this Agreement; provided, however, that all such co-owners
shall continue to have the right to enter into and execute all contracts or
agreements for their respective shares of the oil and gas produced from the
wells drilled hereunder in accordance with sub-section (c) of Section 11
hereof.

     10. INSURANCE; OPERATOR'S LIABILITY.

         (a) Operator shall obtain and maintain at its own expense so long as
it is Operator hereunder all required Workmen's Compensation Insurance and
comprehensive general public liability insurance in amounts and coverage not
less than $1,000,000 per person per occurrence for personal injury or death
and $1,000,000 for property damage per occurrence, which insurance shall
include coverage for blow-outs and total liability coverage of not less than
$10,000,000.

         Subject to the aforesaid limits, the Operator's general public
liability insurance shall be in all respects comparable to that generally
maintained in the industry with respect to services of the type to be rendered
and activities of the type to be conducted under this Agreement; Operator's
general public liability insurance shall, if permitted by Operator's insurance
carrier:

              (i)   name the Developer as an additional insured party; and

              (ii)  provide that at least thirty (30) days' prior notice of
                    cancellation and any other adverse material change in the
                    policy shall be given to the Developer.

Provided, that the Developer shall reimburse Operator for the additional cost,
if any, of including it as an additional insured party under the Operator's
insurance.

         Current copies of all policies or certificates thereof shall be
delivered to the Developer upon request. It is understood and agreed that
Operator's insurance coverage may not adequately protect the interests of the
Developer hereunder and that the Developer shall carry at its expense such
excess or additional general public liability, property damage, and other
insurance, if any, as the Developer deems appropriate.

         (b) Operator shall require all of its subcontractors to carry all
required Workmen's Compensation Insurance and to maintain such other
insurance, if any, as Operator in its discretion may require.

         (c) Operator's liability to the Developer as Operator hereunder shall
be limited to, and Operator shall indemnify the Developer and hold it harmless
from, claims, penalties, liabilities, obligations, charges, losses, costs,
damages or expenses (including but not limited to reasonable attorneys' fees)
relating to, caused by or arising out of:

              (i)   the noncompliance with or violation by Operator, its
                    employees, agents, or subcontractors of any local, state or
                    federal law, statute, regulation, or ordinance;

              (ii)  the negligence or misconduct of Operator, its employees,
                    agents or subcontractors; or

              (iii) the breach of or failure to comply with any provisions of
                    this Agreement.

     11. INTERNAL REVENUE CODE ELECTION; RELATIONSHIP OF PARTIES; RIGHT TO
TAKE PRODUCTION IN KIND.

         (a) With respect to this Agreement, each of the parties hereto
elects, under the authority of Section 761(a) of the Internal Revenue Code of
1986, as amended, to be excluded from the application of all of the provisions
of Subchapter K of

                                       9

<PAGE>

Chapter 1 of Sub Title A of the Internal Revenue Code of 1986, as amended. If
the income tax laws of the state or states in which the property covered
hereby is located contain, or may hereafter contain, provisions similar to
those contained in the Subchapter of the Internal Revenue Code of 1986, as
amended, referred to under which a similar election is permitted, each of the
parties agrees that such election shall be exercised. Beginning with the first
taxable year of operations hereunder, each party agrees that the deemed
election provided by Section 1.761-2(b)(2)(ii) of the Regulations under the
Internal Revenue Code of 1986, as amended, will apply; and no party will file
an application under Section 1.761-2 (b)(3)(i) and (ii) of said Regulations to
revoke such election. Each party hereby agrees to execute such documents and
make such filings with the appropriate governmental authorities as may be
necessary to effect such election.

         (b) It is not the intention of the parties hereto to create, nor
shall this Agreement be construed as creating, a mining or other partnership
or association or to render the parties liable as partners or joint venturers
for any purpose. Operator shall be deemed to be an independent contractor and
shall perform its obligations as set forth herein or as otherwise directed by
the Developer.

         (c) Subject to the provisions of Section 8 hereof, the Developer
shall have the exclusive right to sell or dispose of its proportionate share
of all oil and gas produced from the wells to be drilled hereunder, exclusive
of production which may be used in development and producing operations,
production unavoidably lost, and production used to fulfill any free gas
obligations under the terms of the applicable Lease or Leases; and Operator
shall not have any right to sell or otherwise dispose of such oil and gas. The
Developer shall have the exclusive right to execute all contracts relating to
the sale or disposition of its proportionate share of the production from the
wells drilled hereunder. Developer shall have no interest in any gas purchase
agreements of Operator, except the right to receive Developer's share of the
proceeds received from the sale of any gas or oil from wells developed
hereunder. The Developer agrees to designate Operator or Operator's designated
bank agent as the Developer's collection agent in any such contract. Upon
request, Operator shall render assistance in arranging such sale or
disposition and shall promptly provide the Developer with all relevant
information which comes to Operator's attention regarding opportunities for
sale of production.

         In the event Developer shall fail to make the arrangements necessary
to take in kind or separately dispose of its proportionate share of the oil
and gas produced hereunder, Operator shall have the right, subject to the
revocation at will by the Developer, but not the obligation, to purchase such
oil and gas or sell it to others at any time and from time to time, for the
account of the Developer at the best price obtainable in the area for such
production, however, Operator shall have no liability to Developer should
Operator fail to market such production.

         Any such purchase or sale by Operator shall be subject always to the
right of the Developer to exercise at any time its right to take in kind, or
separately dispose of, its share of oil and gas not previously delivered to a
purchaser. Any purchase or sale by Operator of any other party's share of oil
and gas shall be only for such reasonable periods of time as are consistent
with the minimum needs of the Industry under the particular circumstance, but
in no event for a period in excess of one (1) year.

     12. FORCE MAJEURE.

         (a) If Operator is rendered unable, wholly or in part, by force
majeure (as hereinafter defined) to carry out its obligations under this
Agreement, the Operator shall give to the Developer prompt written notice of
the force majeure with reasonably full particulars concerning it; thereupon,
the obligations of the Operator, so far as it is affected by the force
majeure, shall be suspended during but no longer than, the continuance of the
force majeure. Operator shall use all reasonable diligence to remove the force
majeure as quickly as possible to the extent the same is within reasonable
control.

         (b) The term "force majeure" shall mean an act of God, strike,
lockout, or other industrial disturbance, act of the public enemy, war,
blockade, public riot, lightning, fire, storm, flood, explosion, governmental
restraint, unavailability of equipment or materials, plant shut-downs,
curtailments by purchasers and any other causes whether of the kind
specifically enumerated above or otherwise, which directly precludes
Operator's performance hereunder and is not reasonably within the control of
the Operator.

         (c) The requirement that any force majeure shall be remedied with all
reasonable dispatch shall not require the settlement of strikes, lockouts, or
other labor difficulty affecting the Operator, contrary to its wishes. The
method of handling all such difficulties shall be entirely within the
discretion of the Operator.

     13. TERM.

                                      10

<PAGE>

         This Agreement shall become effective when executed by Operator and
the Developer. Except as provided in sub-section (c) of Section 3, the
Agreement shall continue and remain in full force and effect for the
productive lives of the wells being operated hereunder.

     14. GOVERNING LAW AND INVALIDITY.

         This Agreement shall be governed by, construed and interpreted in
accordance with the laws of the Commonwealth of Pennsylvania.

         The invalidity or unenforceability of any particular provision of
this Agreement shall not affect the other provisions hereof, and this
Agreement shall be construed in all respects as if such invalid or
unenforceable provision were omitted.

     15. INTEGRATION.

         This Agreement, including the Exhibits hereto, constitutes and
represents the entire understanding and agreement of the parties with respect
to the subject matter hereof and supersedes all prior negotiations,
understandings, agreements, and representations relating to the subject matter
hereof.

         No change, waiver, modification, or amendment of this Agreement shall
be binding or of any effect unless in writing duly signed by the party against
which such change, waiver, modification, or amendment is sought to be enforced.

     16. WAIVER OF DEFAULT OR BREACH.

         No waiver by any party hereto to any default of or breach by any
other party under this Agreement shall operate as a waiver of any future
default or breach, whether of like or different character or nature.

     17. NOTICES.

         Unless otherwise provided herein, all notices, statements, requests,
or demands which are required or contemplated by this Agreement shall be in
writing and shall be hand-delivered or sent by registered or certified mail,
postage prepaid, to the following addresses until changed by certified or
registered letter so addressed to the other party:

         (i)  If to the Operator, to:

              Atlas Resources, Inc.
              311 Rouser Road
              Moon Township, Pennsylvania 15108
              Attention: President

         (ii) If to Developer, to:

              Atlas-Energy for the Nineties-Public #8 Ltd.
              c/o Atlas Resources, Inc.
              311 Rouser Road
              Moon Township, Pennsylvania 15108

         Notices which are served by registered or certified mail upon the
parties hereto in the manner provided in this Section shall be deemed
sufficiently served or given for all purposes under this Agreement at the time
such notice shall be mailed as provided herein in any post office or branch
post office regularly maintained by the United States Postal Service or any
successor to the functions thereof. All payments hereunder shall be
hand-delivered or sent by United States mail, postage prepaid to the addresses
set forth above until changed by certified or registered letter so addressed
to the other party.

     18. INTERPRETATION.

         Whenever this Agreement makes reference to "this Agreement" or to any
provision "hereof," or words to similar effect, the reference shall be
construed to refer to the within instrument unless the context clearly
requires otherwise. The titles of the Sections herein have been inserted as a
matter of convenience of reference only and shall not control or affect the
meaning or construction of any of the terms and provisions hereof. As used in
this Agreement, the plural shall include the singular and the singular shall
include the plural whenever appropriate.

                                      11

<PAGE>

     19. COUNTERPARTS.

         The parties hereto may execute this Agreement in any number of
separate counterparts, each of which, when executed and delivered by the
parties hereto, shall have the force and effect of an original; but all such
counterparts shall be deemed to constitute one and the same instrument.

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement under their respective seals as of the day and year first above
written.

Attest                                 ATLAS RESOURCES, INC.

/s/ Barbara J. Krasnicki               By: /s/ Tony C. Banks
----------------------------              ------------------------------------
Barbara J. Krasnicki                      Tony C. Banks, President and CEO
Secretary
[Corporate Seal]

                                       ATLAS-ENERGY FOR NINETIES-PUBLIC #8 LTD.

Attest                                 By its Managing General Partner:

/s/ Barbara J. Krasnicki               ATLAS RESOURCES, INC.
----------------------------
Barbara J. Krasnicki
Secretary
[Corporate Seal]                       By: /s/ Tony C. Banks
                                          ------------------------------------

                                      12

<PAGE>

                   ATLAS-ENERGY FOR THE NINETIES-PUBLIC #8 LTD
                        DRILLING AND OPERATING AGREEMENT
                                    EXHIBIT A

                             Bobish #1
              ------------------------------------------------------------
                             Hostetler Unit #14
              ------------------------------------------------------------
                             Hostetler #15
              ------------------------------------------------------------
                             McFarland #15
              ------------------------------------------------------------
                             Yoder #8
              ------------------------------------------------------------

<PAGE>

                DESCRIPTION OF LEASES AND INITIAL WELL LOCATIONS

               [To be completed as information becomes available]

1.    WELL LOCATION

      (a)  Oil and Gas Lease from ______________________________________ dated
           _____________________ and recorded in Deed Book Volume __________,
           Page __________ in the Recorder's Office of County, ____________,
           covering approximately _________ acres in
           ____________________________ Township, ___________________ County,
           __________________________.

      (b)  The portion of the leasehold estate constituting the
           ____________________________________________ No. __________ Well
           Location is described on the map attached hereto as Exhibit A-l.

      (c)  Title Opinion of _________________________________,
           ____________________________________,
           ________________________________________,
           ________________________________________, dated ___________________,
           19_____.

      (d)  The Developer's interest in the leasehold estate constituting this
           Well Location is an undivided % Working Interest to those oil and
           gas rights from the surface to the bottom of the Medina/Whirlpool
           Formation, subject to the landowner's royalty interest and
           Overriding Royalty Interests.

                              Exhibit A

ASSIGNMENT OF OIL AND GAS LEASE (TO BE PROVIDED AS BECOME AVAILABLE)

                              Exhibit B

<PAGE>

                             ADDENDUM NO. 1
                 TO DRILLING AND OPERATING AGREEMENT
                         DATED DECEMBER 3, 1999

THIS ADDENDUM NO. 1 made and entered into this 31st day of December, 1999, by
and between ATLAS RESOURCES, INC., a Pennsylvania corporation (hereinafter
referred to as "Operator"),

                                       and

ATLAS-ENERGY FOR THE NINETIES-PUBLIC #8 LTD., a Pennsylvania limited
partnership, (hereinafter referred to as the Developer).

                                WITNESSETH THAT:

WHEREAS, Operator and the Developer have entered into a Drilling and
Operating Agreement dated December 3, 1999, (the "Agreement"), which
Agreement relates to the drilling and operating of five (5) natural gas wells
on the five (5) Initial Well Locations in Mercer County, Pennsylvania,
identified on the maps attached as Exhibits A-l through A-5 to said
Agreement, and provides for the development upon the terms and conditions
therein set forth of such Additional Well Locations as the parties may from
time to time designate; and

WHEREAS, pursuant to Section l(c) of said Agreement, Operator and Developer
presently desire to designate fifty-three (53) Additional Well Locations
hereinafter described to be developed in accordance with the terms and
conditions of said Agreement.

NOW, THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the parties hereto agree as follows:

 1. Pursuant to Section l(c) of the aforesaid Agreement, the Developer hereby
authorizes Operator to drill, complete (or plug) and operate, upon the terms
and conditions set forth in said Agreement and this Addendum No. 1,
fifty-three (53) additional natural gas wells on the fifty-three (53)
Additional Well Locations described on Exhibit A hereto and on the maps
attached hereto as Exhibits A-1 through A-53.

 2. Operator, as Developer's independent contractor, agrees to drill, complete
(or plug) and operate said additional natural gas wells on said Additional
Well Locations in accordance with the terms and conditions of said Agreement
and further agrees to use its best efforts to commence drilling the first such
additional well within thirty (30) days after the date hereof and to commence
drilling all said fifty-three (53) additional wells on or before March 30,
2000.

 3. Developer hereby acknowledges that Operator has furnished Developer with
the title opinions identified on Exhibit A hereto, and such other documents
and information which Developer or its counsel has requested in order to
determine the adequacy of the title to the aforesaid Additional Well
Locations. The Developer hereby accepts the title to the aforesaid Additional
Well Locations and leased premises in accordance with the provisions of
Section 5 of the Agreement.

 4. The drilling and operation of said fifty-three (53) additional natural
gas wells on the aforesaid fifty-three (53) Additional Well Locations shall
be in accordance with and subject to the terms and conditions set forth in
the aforesaid Agreement as supplemented by this Addendum No. 1 and except as
previously supplemented, all terms and conditions of the aforesaid Agreement
shall remain in full force and effect as originally written.

 5. This Addendum No. 1 shall be legally binding upon, and shall inure to the
benefit of, the parties hereto and their respective heirs, personal
representatives, successors and assigns.

                                    Exhibit C
                                    (Page 1)

<PAGE>

WITNESS the due execution hereof on the day and year first above written.

Attest:                            ATLAS RESOURCES, INC.

/s/ Barbara J. Krasnicki           By: /s/ Tony C. Banks
--------------------------------      -----------------------------------
Barbara J. Krasnicki                  Tony C. Banks, President and CEO
Secretary
[Corporate Seal]

                                   ATLAS ENERGY FOR THE NINETIES-PUBLIC #8 LTD.

                                   By its Managing General Partner:

                                   ATLAS RESOURCES, INC.

Attest:

/s/ Barbara J. Krasnicki           By: /s/ Tony C. Banks
--------------------------------      -----------------------------------
Barbara J. Krasnicki                  Tony C. Banks, President and CEO
Secretary
[Corporate Seal]

                                    Exhibit C
                                    (Page 2)

<PAGE>

                   ATLAS-ENERGY FOR THE NINETIES-PUBLIC #8 LTD
                        DRILLING AND OPERATING AGREEMENT
                                    EXHIBIT A

                          CLOSE TWO - DECEMBER 31, 1999

                                  ATKINSON #2
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                                  BALOG #1
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                                  BOUGHTON #1
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                                  BRAATZ #1
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                                  BYLER #72
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                                  BYLER #73
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                                  BYLER #76
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                                  BYLER #80
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                                  CLARK #7
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                                  COMBINE #1
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                                  CZUBEK #2
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                                  EMORY-AMES #2
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                                  GARRETT #5
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                                  GAVIN #1
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                                  GEARHART #1
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                                  HARDISKY #1
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                                  HERRIOTT #1
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                                  HUTCHISON #1
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                                  KAUFMAN #1
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                                  KENDALL #2
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                                  LAMOREE #2
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                                  LANNING #1
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                                  LEALI #6
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                                  LEALI #7
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                                  LEHTO #1
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                                  LEHTO #2
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                                  LOWER COLORADO #3
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                                  MCFARLAND #16
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                                  MINA-CARR #3
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                                  MINNER #10
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                                  MINNER #11
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                                  MINNER #4
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                                  MITCHELTREE #1
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                                  PICCIRILLI #1
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                                  RACKETA UNIT #2
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                                  REDICK #1
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                                  REITER UNIT #1
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                                  SACEWICZ #1
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                                  SHAFFER #6
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                                  SHAFFER UNIT #8
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                                  SHARDY #1
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                                  STICKLE #1
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                                  STURGIS H. #1
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                                  SUTTON #1
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                                  TELESZ #1
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                                  TELESZ #2
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                                  WALLACE #2
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                                  WENGERD #7
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                                  WHALEN #1
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                                  WILSON #6
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                                  YASNOWSKY #2
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                                  YASNOWSKY #3
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                                  YODER #9
         ------------------------------------------------------------------<PAGE>
                                                        Exhibit 10.1
BANK OF AMERICA
                                                        AMENDMENT TO DOCUMENTS

                   AMENDMENT NO. 4 TO BUSINESS LOAN AGREEMENT

         This Amendment No. 4 (the "Amendment") dated as of January 13, 2000, is
between Bank of America, N.A. (the "Bank"), formerly Bank of America NT & SA and
Tab Products Co. (the "Borrower").

                                    RECITALS

         A.       The Bank and the Borrower entered into a certain Business Loan
Agreement dated as of November 1, 1998, as previously amended (the "Agreement").

         B.       The Bank and the Borrower desire to further amend the
Agreement.

                                    AGREEMENT

         1.       DEFINITIONS. Capitalized terms used but not defined in this
Amendment shall have the meaning given to them in the Agreement.

         2.       AMENDMENTS. The Agreement is hereby amended as follows:

                  2.1      A new Paragraph 11.16 is added to the Agreement to
                           read as follows:

                           "11.16   SALE OF CORPORATE HEADQUARTERS BUILDING. The
                                    Borrower fails to sell its corporate
                                    headquarter's building and receive the
                                    proceeds thereof before February 28, 2000
                                    for a purchase price (net of closing costs)
                                    of more than Fifteen Million Dollars
                                    ($15,000,000)."

         3.       REPRESENTATIONS AND WARRANTIES. When the Borrower signs this
Amendment, the Borrower represents and warrants to the Bank that:
(a) there is no event which is, or with notice or lapse of time or both would
be, a default under the Agreement except those events, if any, that have been
disclosed in writing to the Bank or waived in writing by the Bank, (b) the
representations and warranties in the Agreement are true as of the date of this
Amendment as if made on the date of this Amendment, (c) this Amendment is within
the Borrower's powers, has been duly authorized, and does not conflict with any
of the Borrower's organization papers, and (d) this Amendment does not conflict
with any law, agreement, or obligation by which the Borrower is bound.

         4.       EFFECT OF AMENDMENT. Except as provided in this Amendment, all
of the terms and conditions of the Agreement shall remain in full force and
effect.

         This Amendment is executed as of the date stated at the beginning of
this Amendment.

BANK OF AMERICA, N.A.                       Tab Products Co.

X /s/Chris P. Giannotti                   X /s/ David J. Davis
By:   Chris P. Giannotti, Vice President   By:        David J. Davis, SVP,
                                                      Operations and Chief
                                                      Financial Officer

                                           X /s/ Robert J. Sexton
                                           By:        Robert J. Sexton
                                                      Treasurer & Secretary

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