EXHIBIT 10.71



                          VILLAGE FARMS OF MARFA, L.P.




                        AGREEMENT OF LIMITED PARTNERSHIP









                            Dated as of June 4, 1997











     THE LIMITED PARTNERSHIP INTEREST REPRESENTED HEREBY HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS
OF CERTAIN STATES AND HAVE BEEN OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS  FROM
THE REGISTRATION  REQUIREMENT OF THE ACT AND SUCH LAWS. THE LIMITED  PARTNERSHIP
INTEREST IS SUBJECT TO  RESTRICTIONS  ON  TRANSFERABILITY  AND RESALE AND MAY BE
TRANSFERRED  ONLY IN A MANNER WHICH IS IN COMPLIANCE WITH THE PROVISIONS OF THIS
AGREEMENT, AND MAY ONLY BE TRANSFERRED IN A TRANSACTION THAT IS REGISTERED UNDER
THE ACT OR EXEMPT FROM SUCH REGISTRATION.


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                                TABLE OF CONTENTS

                                        1

                                    ARTICLE I

                                   DEFINITIONS

1.1 Certain Defined Terms......................................................1
1.2 Other Definitional Provisions.............................................12



                                   ARTICLE II

                               GENERAL PROVISIONS

2.1 Formation of Partnership..................................................13
2.2 Name of the Partnership...................................................13
2.3 Business of the Partnership...............................................13
2.4 Registered Office of the Partnership......................................13
2.5 Liability of the Partners Generally.......................................13
2.6 Office of the Partnership.................................................14
2.7 Duration of the Partnership...............................................14



                                   ARTICLE III

                              CAPITAL CONTRIBUTIONS

3.1 Capital Contributions.....................................................16
3.2 Additional Capital Contributions..........................................15
3.3 Conditions 15
3.4 Interest.  ...............................................................17
3.5 Withdrawals of Capital....................................................17
3.6 Additional Capital Contributions..........................................17



                                   ARTICLE IV

                        ALLOCATION OF PROFITS AND LOSSES

4.1 Profits and Losses........................................................18
4.2 Capital Account Balances..................................................19
4.3 Minimum Gain Chargeback...................................................19
4.4 Nonrecourse Deductions....................................................20
4.5 Partner Nonrecourse Deductions............................................20

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4.6 Qualified Income Offset...................................................20
4.7 Curative Allocations......................................................20
4.8 Tax Allocations...........................................................20
4.9 Property Subject to 704(b) and 704(c......................................20
4.10 Limitations..............................................................20


                                    ARTICLE V

                                  DISTRIBUTIONS

5.1 Distribution of Net Distributable Cash....................................21
5.2 Default Allocations for Cogentrix.........................................21
5.3 Default Allocations for VF................................................22



                                   ARTICLE VI

                                   MANAGEMENT

6.1 Management of the Partnership.............................................23
6.2 Fundamental Matters.......................................................23
6.3 Officers of the Partnership...............................................26
6.4 No Compensation; Reimbursement............................................27
6.5 Insurance ................................................................27
6.6 Cooperation on Tax Matters................................................27

                                   ARTICLE VII

                        BOOKS, RECORDS AND BANK ACCOUNTS

7.1 Books and Records.........................................................27
7.2 Accounting Basis and Fiscal Year..........................................28
7.3 Reports ..................................................................28
7.4 Bank Accounts.............................................................29
7.5 Tax Returns...............................................................29
7.6 Tax Elections.............................................................29
7.7 Tax Matters Partner.......................................................29
7.8 Withholdings..............................................................29


                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

8.1 Transfer of a Partner's Interest..........................................30


                                   ARTICLE IX


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                   ADDITIONAL PARTNERS; WITHDRAWAL OF PARTNERS

9.1 Additional Partners.......................................................31
9.2 Withdrawal of Partners....................................................31



                                    ARTICLE X

                           DISSOLUTION AND LIQUIDATION

10.1 Events of Dissolution....................................................33
10.2 Distributions Upon Liquidation...........................................33


                                   ARTICLE XI

                               DISPUTE RESOLUTION

11.1 Arbitration..............................................................34
11.2 Buy/Sell Option..........................................................35


                                   ARTICLE XII

                                  MISCELLANEOUS

12.1 Distributions and Notices................................................36
12.2 Disclosure Obligations...................................................36
12.3 Successors and Assigns...................................................37
12.4 Amendments...............................................................37
12.5 Partition................................................................37
12.6 No Waiver................................................................37
12.7 Entire Agreement.........................................................37
12.8 Captions ................................................................37
12.9 Counterparts.............................................................37
12.10 Applicable Law..........................................................38
12.11 Severability............................................................38



                                         LIST OF SCHEDULES

Schedule 1.1(a)            Calculation of Internal Rate of Return
Schedule 1.1(b)            Project Budget
Schedule 1.1(c)            Project Documents
Schedule 1.1(d)            Site
Schedule 6.3               Initial Officers of the Partnership



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                        AGREEMENT OF LIMITED PARTNERSHIP


     This Agreement of Limited  Partnership  dated as of June 4, 1997 of VILLAGE
FARMS OF MARFA,  L.P. (the  "Partnership")  is by and among  COGENTRIX OF MARFA,
INC., a Delaware corporation ("Cogentrix GP" and a "General Partner"), COGENTRIX
GREENHOUSE  INVESTMENTS,  INC.,  a Delaware  corporation  ("Cogentrix  LP" and a
"Limited  Partner"),  VILLAGE  FARMS OF  DELAWARE,  L.L.C.,  a Delaware  limited
liability  company ("VF Delaware" and a "General  Partner"),  and VILLAGE FARMS,
L.L.C., a Delaware limited liability company ("VF" and a "Limited Partner").

     VF Delaware is a Delaware limited liability company owned 99% by Agro Power
Development,  Inc., a New York corporation ("Agro Power"), and 1% by VF. VF is a
Delaware  limited  liability  company  owned  99%  by  Agro  Power  and 1% by VF
Delaware.  Agro Power has entered into agreements and instruments (as more fully
defined  hereafter,  the "Project  Documents")  related to the  development  and
operation of a venlo style  greenhouse  located in the vicinity of Marfa,  Texas
for the  purpose of  producing  and  selling  tomatoes  (as more  fully  defined
hereafter,  the  "Project").  In order to continue with the  development  of the
Project and obtain financing for  construction  and working capital needs,  Agro
Power  desires that  Cogentrix GP and  Cogentrix LP  contribute in the aggregate
$6,649,434 to the Project.  In order to encourage  Cogentrix to contribute  such
funds to the  Project,  Agro Power has agreed (1) to cause VF Delaware and VF to
form the  Partnership  with  Cogentrix GP and Cogentrix LP pursuant to which all
Project  Documents  will  be  assigned  to  the  Partnership,  as VF  Delaware's
contribution  to  the  Partnership,  in  exchange  for  a  1%  interest  in  the
Partnership,  and likewise as VF's  contribution  to the Partnership in exchange
for a 49% interest in the Partnership,  (2) that, in exchange for a contribution
to the capital of the  Partnership  of $980 by Cogentrix  LP,  Cogentrix LP will
receive a 49%  interest in the  Partnership,  and (3) that,  in  exchange  for a
contribution to the capital of the Partnership of $20 by Cogentrix GP, Cogentrix
GP will receive a 1% interest in the Partnership.  Cogentrix GP and Cogentrix LP
have agreed to make such  contributions to the capital of the Partnership on the
terms and conditions set forth herein.

     Accordingly,  in  consideration  of the covenants and agreements  contained
herein and other good and  valuable  consideration,  the receipt and adequacy of
which are hereby  acknowledged,  and intending to be legally bound,  the parties
hereto hereby agree as follows:


                                    ARTICLE I
                                   DEFINITIONS

     1.1 Certain Defined Terms.

     As used in this Agreement,  the following terms have the following meanings
(such definitions to be equally  applicable to both singular and plural forms of
the terms defined):

     "Abandonment" has the meaning set forth in subsection 6.2(e).


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     "Adjusted Capital Account Deficit" means, with respect to any Partner,  the
deficit balance,  if any, in such Partner's Capital Account as of the end of the
relevant fiscal year, after giving effect to the following adjustments:

          (a) Credit to such Capital  Account any amounts  which such Partner is
     obligated  to restore  pursuant to any  provision  of this  Agreement or is
     deemed to be obligated to restore  pursuant to the penultimate  sentence of
     Regulations Section 1.704-2(g)(1) and 1.704-2(i)(5); and

          (b) debit to such Capital  Account the items  described in Regulations
     Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

The foregoing  definition  of Adjusted  Capital  Account  Deficit is intended to
comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall
be interpreted consistently therewith.

     "Adverse  Consequence"  means all actions,  suits,  proceedings,  hearings,
investigations,  charges, complaints,  claims, demands, injunctions,  judgments,
orders, decrees, rulings,  damages, dues, penalties,  fines, costs, amounts paid
in settlement,  liabilities,  obligations,  Taxes, liens,  losses,  expenses and
fees,  including,  but not limited to, court  costs,  arbitral  costs,  costs of
investigation, and attorneys' fees.

     "Affiliate" of any designated Person, means each Person which,  directly or
indirectly,  controls or is controlled  by or is under common  control with such
designated  Person and, without limiting the generality of the foregoing,  shall
include (a) any Person  which  beneficially  owns or holds ten percent  (10%) or
more of any class of voting  securities of such designated Person or ten percent
(10%) or more of the  equity  interest  in such  designated  Person  and (b) any
Person of which such designated  Person  beneficially owns and holds ten percent
(10%) or more of any  class of voting  securities  or in which  such  designated
Person  beneficially  owns or holds  ten  percent  (10%)  or more of the  equity
interest. For the purposes of this definition, the terms "controls", "controlled
by" and "under common control  with," as used with respect to any Person,  shall
mean the possession, directly or indirectly, of the power to direct or cause the
direction of the  management  and policies of such Person,  whether  through the
ownership of voting securities or by contract or otherwise.  Notwithstanding the
foregoing,  neither  Cogentrix  GP or  Cogentrix  LP,  on the one  hand,  nor VF
Delaware  or VF, on the other  hand,  shall be  deemed to be  Affiliates  of one
another.

     "After-Tax"  means after  deducting  Cogentrix  GP's or Cogentrix  LP's, as
applicable,  notional  project  Federal  and state  income  tax. As used in this
definition of After-Tax,  the notional  project  Federal and state income tax of
Cogentrix GP and Cogentrix LP shall be calculated as follows:

          (a) The  Partnership's  taxable  income would be  calculated  from the
     Schedule K most recently  filed with the Internal  Revenue  Service (or the
     appropriate  successor  form or  schedule),  which for  purposes of clarity
     would include operating income as shown on such Schedule and all separately
     stated items of income or loss (except tax exempt  income) as shown on such
     Schedule.



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          (b) Assuming the Partnership were taxable as a for-profit corporation,
     the Partnership's Federal and state income tax would be determined based on
     the  taxable  income  calculated  in (a).  For these  purposes,  it will be
     assumed that all of the  Partnership's  taxable  income shall be taxed at a
     blended  Federal/state  rate of 38.0%  (subject  to  adjustment  upward  or
     downward,  as  applicable,  to  reflect  changes  in the  highest  marginal
     corporate Federal tax rate).

          (c) The Partnership's  notional income tax obligation as calculated in
     (b) shall be allocated among the Partners in the same manner as Profits and
     Losses are allocated among the Partners under Article IV hereof.

Provided  that,  for each  quarter  end and at year end  until  such time as the
Partnership  has filed a  Schedule K with the  Internal  Revenue  Service  and a
true-up of taxable  income has  occurred,  notional  project  Federal  and state
income tax for Cogentrix GP and Cogentrix LP shall be calculated by  multiplying
Estimated  Taxable  Income  allocated  to  Cogentrix  GP and  Cogentrix LP under
Article IV hereof, as the case may be, by 38.0% (subject to adjustment upward or
downward,  as applicable,  to reflect changes in the highest marginal  corporate
Federal tax rate).

     "Agreement"  means this  Agreement  of  Limited  Partnership,  as  amended,
supplemented or otherwise modified and in effect from time to time.

     "Agro Power" means Agro Power Development Inc., a New York corporation with
offices at 10 Alvin Court, East Brunswick, New Jersey 08816.

     "Agro Power Investment" means all cash  contributions to the capital of the
Partnership made by VF Delaware and VF pursuant to this Agreement.

     "Appraisal Procedure" means a procedure whereby two independent appraisers,
one chosen by each General Partner, shall agree upon the determinations then the
subject of appraisal. Each General Partner shall deliver a written notice to the
other  appointing its appraiser within 15 days after receipt from the other of a
written notice  appointing  its  appraiser.  Each appraiser then shall prepare a
written appraisal with respect to the determinations  which then are the subject
of appraisal. If within 30 days after appointment of the two appraisers they are
unable to agree upon the amount in question, a third independent appraiser shall
be chosen  within 10 days  thereafter  by the  mutual  consent of such first two
appraisers or, if such first two appraisers  fail to agree upon the  appointment
of a third appraiser, such appointment shall be made by the American Arbitration
Association,  or any organization successor thereto, from a panel of arbitrators
having  experience  in the  business  of  operating a  hydroponic  hot house and
marketing the product  produced therein and a familiarity with equipment used or
operated in such business.  The decision of the third appraiser so appointed and
chosen  shall  be  given  within  30 days  after  the  selection  of such  third
appraiser.  If three appraisers shall be appointed and the  determination of one
appraiser  is  disparate  from the median by more than twice the amount by which
the other  determination is disparate from the median, then the determination of
such  appraiser  shall be excluded,  the remaining two  determinations  shall be
averaged  and such  average  shall be  binding  and  conclusive  on the  General
Partners; otherwise the average of all three determinations shall be binding and
conclusive  on  the  General  Partners.  (For  example,  if


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the two appraisers  appointed by the General Partners  determine a value of $100
and $200, and the third appraiser  determines a value of $150, then the value in
question shall be conclusively determined to be $150 ($100 + $200 + $150 divided
by 3). As a further example,  consider the first example but the third appraiser
places a value of $190. In this case,  the $100  valuation  shall be disregarded
and the value shall be  conclusively  determined to be $195 ($190 + $200 divided
by 2).  The $100  valuation  is  disregarded  because  the  median  of the three
appraisers  was $190 and the  difference  between $100 and $190 is $90, which is
more  than  twice  the  difference  between  $200 and $190  which is $10,  which
multiplied  by two is $20.) If a General  Partner shall appoint an appraiser and
the other  Person  shall fail to appoint an  appraiser  in the manner  specified
herein,  the  determination  of the appraiser so appointed  shall be binding and
conclusive  on the General  Partners.  The expenses of the  appraisal  procedure
shall be borne solely by the Partnership.

     "Budgets" has the meaning set forth in subsection 6.2(i).

     "Business Day" means a day other than a Saturday, a Sunday or any other day
on which commercial banks in Texas,  North Carolina or New Jersey are authorized
or required by law or executive order to be closed.

     "Buy-Out Offer" has the meaning set forth in Section 11.2.

     "Buy-Out Offeree" has the meaning set forth in Section 11.2.

     "Buy-Out Offeror" has the meaning set forth in Section 11.2.

     "Capital Account" means,  with respect to any Partner,  the capital account
maintained  for such Partner in the  Partnership  Books in  accordance  with the
following provisions:

          (a) To each  Partner's  Capital  Account  there shall be credited such
     Partner's  Capital  Contributions,  such  Partner's  distributive  share of
     Profits  and any other  items in the  nature  of  income or gain  which are
     allocated under this Agreement.

          (b) To each  Partner's  Capital  Account  there  shall be debited  the
     amount of cash and the Gross Asset Value of any property (other than money)
     (net of any liabilities assumed by such Partner or to which the property is
     subject)  distributed  to such  Partner  pursuant to any  provision of this
     Agreement,  and such Partner's  distributive  share of Losses and any other
     items in the nature of deductions or losses which are allocated  under this
     Agreement.

          (c) In the event all or a portion of an interest in the Partnership is
     transferred in accordance with the terms of this Agreement in a transaction
     that does not result in a termination of the Partnership under Code Section
     708(b)(1)(B),  the transferee  shall succeed to the Capital  Account of the
     transferor to the extent it relates to the transferred interest.



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          (d) In determining  the amount of any liability for purposes of clause
     (a) and clause (b) hereof,  there shall be taken into  account Code Section
     752(c) and any other applicable provisions of the Code and the Regulations.

          (e) If a Partner owns more than one Partnership Interest,  one Capital
     Account shall be maintained for the Partnership Interests of the Partner.

          (f) Each  Partner's  Capital  Account  shall in all other  respects be
     maintained  in  accordance  with  the  provisions  of  Regulations  Section
     1.704-1(b).

The foregoing  provisions and the other provisions of this Agreement relating to
the  maintenance  of capital  accounts are  intended to comply with  Regulations
Section 1.704-1(b),  and shall be interpreted and applied in a manner consistent
with such Regulations.

     "Capital  Contribution"  means, with respect to any Partner,  the amount of
money and the initial Gross Asset Value of any property  (other than money) (net
of any  liabilities  assumed  by the  Partnership  or to which the  property  is
subject) contributed to the Partnership with respect to any Partnership Interest
held by such Partner pursuant to the terms of this Agreement.

     "Capital  Lease"  means any lease of property,  real or personal,  which in
accordance with GAAP,  would be required to be capitalized on a balance sheet of
the lessee.

     "Code"  means the Internal  Revenue  Code of 1986,  as amended from time to
time.

     "Cogentrix GP Designee" has the meaning set forth in Section 6.1(a).

     "Cogentrix GP" means Cogentrix of Marfa, Inc., a Delaware corporation.

     "Cogentrix   Investment"   means  (a)  the   respective   Initial   Capital
Contribution   of  Cogentrix  GP  and  Cogentrix  LP  and  (b)  all   subsequent
contributions  to the  capital  of  the  Partnership  made  by  Cogentrix  GP or
Cogentrix  LP (as the case may be)  pursuant to this  Agreement in excess of any
Agro Power Investment.

     "Cogentrix LP" means  Cogentrix  Greenhouse  Investments,  Inc., a Delaware
corporation.

     "Commonly  Controlled Entity" means, with respect to any Person, an entity,
whether or not  incorporated,  which is under  common  control  with such Person
within the meaning of Section 414(b) or (c) of the Code.

     "Construction  Agreement"  means the  Commercial  Design  and  Construction
Contract dated May 1, 1997 by and between the  Partnership and Agro Power, as it
may be amended,  supplemented  or otherwise  modified and in effect from time to
time.

     "Construction/Term  Facility"  means  a  loan  facility  in the  amount  of
$15,950,396  provided by the  Construction/Term  Lender  pursuant to the Project
Loan Documents.



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     "Construction/Term   Lender"  means  Village  Farms  International  Finance
Association or its successor under the Construction/Term Facility.

     "Cumulative  Distributions  to Cogentrix"  means the aggregate,  cumulative
distributions of Net  Distributable  Cash received by Cogentrix GP and Cogentrix
LP from the Partnership.

     "Cumulative   Distributions   to  VF"  means  the   aggregate,   cumulative
distributions of Net Distributable  Cash received by VF Delaware and VF from the
Partnership.

     "Delaware Act" means the Delaware Revised Uniform Limited  Partnership Act,
6 Del.C.  ss.ss.17-101,  et seq., as it may be amended from time to time and any
successor to such Act.

     "Depreciation" means, for each fiscal year or other period, an amount equal
to the deprecation,  amortization,  or other cost recovery  deduction  allocable
with respect to an asset for such  period,  except that if the Gross Asset Value
of an asset  differs  from its  adjusted  basis for Federal tax  purposes at the
beginning of such period,  Depreciation  shall be an amount which bears the same
ratio  to  such   beginning   Gross  Asset  Value  as  the  Federal  income  tax
depreciation,  amortization  or other cost  recovery  deduction  for such period
bears to such beginning adjusted tax basis;  provided that if the Federal income
tax depreciation, amortization, or other cost recovery deduction for such period
is zero, Depreciation shall be determined with reference to such beginning Gross
Asset Value using any reasonable method selected by the Management Committee.

     "Dollars" and "$" means dollars in lawful  currency of the United States of
America.

     "Equity  Funding Date" means the day on which all of the  conditions to the
initial  drawdown  under the  Construction/Term  Loan  Facility  (other than the
contributions  to the capital of the  Partnership to be made by Cogentrix GP and
Cogentrix  LP  under  Section  3.2)  have  been met to the  satisfaction  of the
Construction/Term Lender.

     "ERISA" means the  Employment  Retirement  Income  Security Act of 1974, as
amended from time to time.

     "ERISA  Affiliate"  means,  with respect to any Person,  any corporation or
trade or business which is a member of the same controlled group of corporations
(within  the  meaning of Section  414(b) of the Code) as such Person or is under
common  control  (within  the  meaning of Section  414(c) of the Code) with such
Person.

     "Estimated Taxable Income" means book income of the Partnership computed in
accordance  with  GAAP  adjusted  to  reflect  the  estimated  depreciation  and
amortization  timing  differences  between  financial  reporting  and income tax
reporting.

     "First Priority  Return" means the receipt by Cogentrix GP and Cogentrix LP
of  cash  distributions  from  Net  Distributable  Cash in an  aggregate  amount
sufficient to provide each of Cogentrix GP and Cogentrix LP, as the case may be,
with an Internal Rate of Return on its respective Cogentrix Investment hereunder
of  [information  omitted and subject to request  for  confidential  treatment]%
calculated in  accordance  with Schedule  1.1(a) (it being  understood  that


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any amounts which are part of Cogentrix Investment pursuant to subsection (b) of
the  definition  of Cogentrix  Investment  shall only be entitled to such return
from the date they are actually paid or made).

     "GAAP" means  generally  accepted  accounting  principles as in effect from
time to time in the United States.

     "General Partner" means each of Cogentrix GP and VF Delaware and any Person
admitted to the Partnership as an additional  General Partner in accordance with
the provisions of this Agreement,  until such time as such Person ceases to be a
general partner of the Partnership as provided herein or in the Delaware Act.

     "Governmental Authority" means any nation or government, any state or other
political subdivision thereof and any entity exercising executive,  legislative,
judicial, regulatory or administrative functions of or pertaining to government.

     "Gross Asset Value" means,  with respect to any asset, the asset's adjusted
basis for Federal income tax purposes, except as follows:

          (a) The  initial  Gross  Asset  Value of any  asset  contributed  by a
     Partner to the  Partnership  shall be the gross fair  market  value of such
     asset, as determined by agreement of the Partners;

          (b) The Gross Asset Value of all Partnership  assets shall be adjusted
     to equal  their  respective  gross fair market  values,  as  determined  by
     agreement of the Partners,  and in the event the Partners fail to so agree,
     as determined by the Appraisal  Procedure,  as of the following  times: (i)
     The acquisition of an additional  interest in the Partnership by any new or
     existing   Partner  in  exchange  for  more  than  a  de  minimis   Capital
     Contribution; (ii) the distribution by the Partnership to a Partner of more
     than a de minimis  amount of property as  consideration  for an interest in
     the Partnership if the Management Committee reasonably determines that such
     adjustment  is necessary or  appropriate  to reflect the relative  economic
     interests of the Partners in the Partnership;  and (iii) the liquidation of
     the    Partnership    within   the   meaning   of    Regulations    Section
     1.704-1(b)(2)(ii)(g);

          (c) The Gross Asset Value of any Partnership  asset distributed to any
     Partner  shall be the gross fair market  value of such asset on the date of
     distribution  as  determined by agreement of the Partners and, in the event
     the Partners fail to so agree, as determined by the Appraisal Procedure;

          (d) The Gross Asset  Values of  Partnership  assets shall be increased
     (or  decreased) to reflect any  adjustments  to the adjusted  basis of such
     assets pursuant to Code Section 734(b) or Code Section 743(b),  but only to
     the extent  that such  adjustments  are taken into  account in  determining
     Capital  Accounts  pursuant to  Regulations  Section  1.704-1(b)(2)(iv)(m);
     provided,  however, that Gross Asset Values shall be adjusted to the extent
     the  Partners  agree (and in the event the  Partners  fail to so agree,  as
     determined  by the  Appraisal  Procedure)  that an  adjustment  pursuant to
     clause (ii) of this  definition is necessary or  appropriate  in connection
     with a transaction that would otherwise result in


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     an  adjustment  pursuant  to clause (iv) of this  definition.  If the Gross
     Asset Value of an asset has been determined or adjusted pursuant to clauses
     (i) and (ii) of this  definition  or clause (iv) of this  definition,  such
     Gross Asset Value shall  thereafter be adjusted by the  Depreciation  taken
     into account with respect to such asset; and

          (e) The  Gross  Asset  Value  of any  asset  owned  indirectly  by the
     Partnership  through a subsidiary  partnership shall be determined pursuant
     to the terms of the partnership agreement for such subsidiary partnership.

     "Indebtedness"  means, with respect to any Person, (a) indebtedness of such
Person for borrowed  money or for the deferred  purchase price of property or of
services (other than obligations  under agreements for the purchase of goods and
services in the normal  course of business  which are not more than 30 days past
due; (b)  obligations of such Person under Capital  Leases;  (c)  obligations of
such Person pursuant to interest hedging  transactions;  (d) obligations of such
Person in respect of letters of credit;  (e)  obligations  of such Person  under
direct and indirect  guarantees in respect of, and  obligations  (contingent  or
otherwise)  to purchase or otherwise  acquire,  or  otherwise  assure a creditor
against loss in respect of,  indebtedness  or obligations of others of the kinds
referred to in clause (a),  (b),  (c) or (d) above (other than  endorsements  of
negotiable  instruments  in the  ordinary  course  of  business);  and  (f)  any
obligations of such Person or a Commonly  Controlled  Entity to a Multi-Employer
Plan. For purposes of clarity,  "Indebtedness"  includes the  obligations of the
Partnership  to repay  amounts  borrowed  under,  and to pay other amounts owing
under, the Project Loan Documents.

     "Initial  Capital  Contribution"  means,  with respect to Cogentrix GP, the
amount of $20 and, with respect to Cogentrix LP, means the amount of $980.

     "Internal Rate of Return" (whether or not capitalized)  means the return to
capital  calculated  at each calendar  quarter end in  accordance  with Schedule
1.1(a), attached hereto and incorporated herein by reference.

     "Lien"  means any  mortgage,  deed of  trust,  security  interest,  pledge,
hypothecation,  encumbrance  or lien  (statutory or other) of any kind or nature
whatsoever  (including,  without  limitation,  any  agreement to give any of the
foregoing,  any  conditional  sale  or  other  title  retention  agreement,  any
financing  lease  having  substantially  the same  economic  effect  as any such
agreement,  and the filing of any statement under the Uniform Commercial Code or
comparable law of any jurisdiction).

     "Limited  Partner"  means  each of  Cogentrix  LP and VF and any Person who
becomes a limited  partner of the  Partnership  in accordance  with the terms of
this Agreement and is shown as such on the books and records of the Partnership.

     "Losses" has the meaning given to it in the definition of "Profits."

     "Management  Agreement" means the Management  Agreement dated the same date
as this Agreement by and between the Partnership  and VF Delaware,  as it may be
amended,  supplemented  or  otherwise  modified and in effect from time to time,
pursuant to which VF Delaware will provide operation and maintenance services to
the Partnership.



                                      -8-
<PAGE>

     "Management  Committee"  means the Management  Committee of the Partnership
referred to in Section 6.1.

     "Marketing  Agreement" means the Marketing Agreement dated the same date as
this  Agreement  by and  between the  Partnership  and VF, as it may be amended,
supplemented or otherwise modified and in effect from time to time,  pursuant to
which VF will agree to market products produced by the Partnership.

     "Multi-Employer  Plan" means,  with respect to any Person, a Multi-Employer
Plan as defined in Section 3(37) of ERISA to which  contributions have been made
by such Person or any ERISA Affiliate and which is covered by Title IV of ERISA.

     "Net Distributable  Cash" means for any period, an amount equal to all cash
received by the  Partnership  during such period,  including but not limited to,
cash from operations,  reductions in reserves,  casualty  proceeds,  rebates and
other extraordinary items, less (a) principal,  interest and other payments made
under or pursuant to the Construction/Term  Facility, (b) interest and fees paid
pursuant  to  the  Revolving  Facility,  or  other  borrowings,   (c)  all  cash
expenditures  of and  payments  made by the  Partnership,  and (d) any  reserves
established by the Management  Committee of the Partnership,  and subject to the
limitations  on  distributions,  if any,  imposed  pursuant  to the terms of the
Project Loan Documents.

     "Nonrecourse  Deductions"  shall have the meaning set forth in  Regulations
Sections  1.704-2(b)  and  (c).  The  amount  of  Nonrecourse  Deductions  for a
Partnership fiscal year equals the excess, if any, of the net increase,  if any,
in the amount of  Partnership  minimum  gain  during  the  fiscal  year over the
aggregate amount of any  distributions  during that fiscal year of proceeds of a
nonrecourse  liability that are allocable to an increase in Partnership  minimum
gain, determined according to the provisions of Regulations Section 1.704-2(c).

     "Operating  Budget"  means the  business  plan and  budget  required  to be
provided to the Partnership pursuant to the Management Agreement.

     "Operating Management Fee" means a management fee to be paid to VF Delaware
in accordance with the Management Agreement.

     "Partner" means any of the General Partners or the Limited Partners.

     "Partner  Nonrecourse  Deductions"  shall  have the  meaning  specified  in
Regulations Section 1.704-2(i)(2).

     "Partnership"  means Village Farms of Marfa, L.P., the limited  partnership
formed  pursuant to this Agreement and the filing of the  Certificate of Limited
Partnership with the Delaware Secretary of State.

     "Partnership   Books"  means  the  books  and  records  maintained  by  the
Partnership  and reviewed  within sixty (60) days of each fiscal year end by the
Management Committee, in which records and information relating to the ownership
of the  Partnership,  the  constituency of the


                                      -9-
<PAGE>

Management  Committee  and  actions  taken by the  Management  Committee  or the
Partners  is  maintained,  including  but not  limited  to,  a  register  of the
Partners,  each Partner's Capital Account,  each Partner's  Percentage Interest,
actions taken by the Management  Committee and the Partners,  and this Agreement
and any amendments hereto.

     "Partnership  Interest" means, with respect to any Partner, the interest of
such Partner in the Partnership,  whether general or limited,  at any particular
time,  including the rights and  obligations of such Partner as provided in this
Agreement and the Delaware Act.

     "Partnership  Percentage" means, with respect to any Partner,  at any time,
the percentage specified as such Partner's "Partnership  Percentage" at the time
such Partner was admitted to the Partnership, as adjusted in accordance with the
terms of this Agreement. The initial Partnership Percentages are as follows:

                  Cogentrix GP              1%
                  Cogentrix LP              49%
                  VF Delaware               1%
                  VF                        49%

     "Permitted  Liens"  means  Liens  in  favor of any  Person  other  than the
Partners or any of their respective  Affiliates,  that (a) arise in the ordinary
course of business of the Partnership (including, without limitation, landlord's
materialmen's,  mechanic's,  worker's,  repairmen's  and  employee's  Liens  and
similar Liens which arise in connection with any tax,  assessment,  governmental
charge or levy) and (b) do not secure Indebtedness.

     "Person" means an individual,  partnership,  corporation,  business  trust,
joint  stock  company,  trust,   unincorporated   association,   joint  venture,
governmental authority or other entity of whatever nature.

     "Profits"  and  "Losses"  mean,  for any  period,  an  amount  equal to the
Partnership's  taxable income or loss for such period,  determined in accordance
with Code Section 703(a) (for this purpose,  all items of income,  gain, loss or
deduction  required to be stated  separately  pursuant to Code Section 703(a)(1)
shall be included in taxable income or loss), with the following adjustments:

          (a) Income of the  Partnership  that is exempt from federal income tax
     and not  otherwise  taken  into  account  in  computing  Profits  or Losses
     pursuant to this definition shall be added to such taxable income or loss;

          (b) any  expenditures  of the  Partnership  described  in Code Section
     705(a)(2)(B) or treated as Code Section 705(a)(2)(B)  expenditures pursuant
     to Regulations Section  1.704-1(b)(2)(iv)(i),  and not otherwise taken into
     account in computing Profits or Losses pursuant to this definition shall be
     subtracted from such taxable income or loss;

          (c) gain and loss with respect to the  disposition of any  Partnership
     asset (both  directly  owned assets and assets owned  indirectly  through a
     subsidiary  partnership)  shall


                                      -10-
<PAGE>

     be computed  with respect to the Gross Asset Value rather than adjusted tax
     basis of such asset;

          (d) in lieu of the depreciation, amortization, and other cost recovery
     deductions  taken into account in computing  taxable income or loss,  there
     shall be taken into  account  Depreciation  for such  fiscal  year or other
     period; and

          (e) in the  event of an  adjustment  in the Gross  Asset  Value of any
     Partnership  asset pursuant to clause (b) of the definition of "Gross Asset
     Value" herein, the amount of such adjustment shall be taken into account as
     gain or loss from the  disposition  of such asset for purposes of computing
     Profits and Losses.

     "Project"  means an  approximately  41-acre  venlo style  greenhouse  to be
located on the Site which is to be constructed in two phases of 20.5-acres  each
and on which the Partnership  will produce tomatoes for sale under the Marketing
Agreement.

     "Project Assets" has the meaning set forth in Section 3.1(a).

     "Project Budget" means the pro forma budget of total Project costs attached
hereto  as  Schedule  1.1(b),  as  amended  or  modified  from  time  to time in
accordance with subsection 6.2(i).

     "Project Credit  Facilities"  means,  collectively,  the  Construction/Term
Facility and the Revolving Facility.

     "Project Documents" means the agreements and instruments listed on Schedule
1.1(c) attached hereto and  incorporated  herein by reference as the same may be
amended,  supplemented  or  otherwise  modified in  accordance  with Section 6.2
hereof and in effect from time to time.

     "Project Loan Documents" means the agreements and instruments  executed by,
between or among the Partnership,  the  Construction/Term  Lender,  the Revolver
Lender,  and any other party relating to the  Construction/Term  Facility and/or
the Revolving  Facility,  as the same may be amended,  supplemented or otherwise
modified in accordance with Section 6.2 hereof and in effect from time to time.

     "Regulations" means the temporary, proposed and final regulations under the
Code and any successor provisions thereto.

     "Requirement  of Law"  means,  as to any  Person,  (a) the  certificate  of
incorporation  and by-laws or partnership  agreement or other  organizational or
governing  documents of such Person, and (b) any law, treaty, rule or regulation
or determination of an arbitrator or a court or other Governmental Authority, in
each case  applicable to or binding upon such Person or any of its properties or
to which such Person or any of its  properties  is subject and the  violation of
which,  or which  determination,  could  reasonably  be  expected  to (i) have a
material  adverse  effect on the  business,  operations,  properties,  condition
(financial  or  otherwise)  or  prospects  of such  Person  or  (ii)  materially
adversely affect the ability of such Person to perform its obligations under the
Project Loan Documents or the Project Documents to which it is a party.



                                      -11-
<PAGE>

     "Revolver Lender" means Village Farms International  Finance Association or
its successor under the Revolving Facility.

     "Revolving  Facility" means a loan facility in the amount of  $2,500,000.00
provided by the Revolver Lender pursuant to a certain revolving credit agreement
between the Revolver Lender and the Partnership.

     "Second Priority Return" means the receipt by Cogentrix GP and Cogentrix LP
of  cash  distributions  of  Net  Distributable  Cash  in  an  aggregate  amount
sufficient to provide each of Cogentrix GP and Cogentrix LP, as the case may be,
with an  Internal  Rate of  Return on its  respective  Cogentrix  Investment  of
[information  omitted  and  subject  to  request  for  confidential  treatment]%
inclusive of the First Priority  Return)  calculated in accordance with Schedule
1.1(a),  (it being  understood  that any  amounts  which  are part of  Cogentrix
Investment pursuant to subsection (b) of the definition of Cogentrix  Investment
shall only be  entitled to such  return for the date they are  actually  paid or
made).  For  purposes  of  Article V hereof,  Internal  Rate of Return  shall be
calculated at each calendar quarter end.

     "Site" means a parcel of approximately 153 acres located in the vicinity of
Marfa,  Texas and more fully  described on Schedule  1.1(d)  attached hereto and
incorporated herein by reference.

     "Subsidiary"  means  with  respect  to any  Person,  an  Affiliate  that is
controlled  (directly or indirectly through one or more  intermediaries) by that
Person.

     "Taxes" means any and all income or gross receipt taxes,  franchise  taxes,
levies,  imposts,  duties,  assessments,  fees,  charges and withholdings of any
nature  whatsoever,  whether  or not  presently  in  existence,  imposed  by any
Governmental Authority.

     "VF" means Village Farms, L.L.C., a Delaware limited liability company, 99%
of which is owned by Agro Power and 1% of which is owned by VF Delaware.

     "VF Delaware" means Village Farms of Delaware,  L.L.C.,  a Delaware limited
liability company,  99% of which is owned by Agro Power and 1% of which is owned
by VF.

     "Withdraw" or  "Withdrawal",  with respect to any Partner,  means a Partner
ceasing to be a partner of the Partnership for any reason,  whether voluntary or
involuntary, and "Withdrawn", with respect to a Partner, means a Partner who has
ceased to be a partner of the Partnership.

     "Withdrawal  Date" means the date of the Withdrawal from the Partnership of
a Withdrawn Partner.

     1.2 Other Definitional Provisions.

          (a) All  terms  defined  in this  Agreement  shall  have  the  defined
     meanings when used in any  certificate  or other document made or delivered
     pursuant hereto, unless otherwise defined therein.



                                      -12-
<PAGE>

          (b) As used herein and in any  certificate  or other  document made or
     delivered pursuant hereto, accounting terms not defined in Section 1.1, and
     accounting  terms partly  defined in Section 1.1 to the extent not defined,
     shall have the respective meanings given to them under GAAP.

          (c) The words "hereof,"  "herein" and "hereunder" and words of similar
     import when used in this Agreement shall refer to this Agreement as a whole
     and  not to any  particular  provision  of  this  Agreement,  and  section,
     schedule and exhibit  references  are to this  Agreement  unless  otherwise
     specified.

          (d) Unless the  context  requires  otherwise,  any  reference  in this
     Agreement to any of the Project  Documents  or the Project  Loan  Documents
     shall mean any of such documents as amended,  supplemented  or modified and
     in effect from time to time.


                                   ARTICLE II
                               GENERAL PROVISIONS

     2.1  Formation of  Partnership.  The Partners  hereby form and  establish a
limited  partnership  under the terms and  provisions of this  Agreement and the
provisions of the Delaware Act, and the rights and  liabilities  of the Partners
shall be as provided in this  Agreement  and in the Delaware  Act.  Concurrently
with the  execution  of the  Agreement  by VF  Delaware,  VF,  Cogentrix  GP and
Cogentrix  LP, VF  Delaware  and  Cogentrix  GP shall  execute and file with the
Office of Secretary of State of the State of Delaware a  Certificate  of Limited
Partnership  in accordance  with Section 17-201 of the Delaware Act, in form and
substance satisfactory to both VF Delaware and Cogentrix GP.

     2.2 Name of the Partnership.  The name of the Partnership  shall be Village
Farms of Marfa,  L.P.,  or such other name as the Partners from time to time may
designate.

     2.3  Business of the  Partnership.  The business of the  Partnership  is to
develop, construct, and operate the Project. In furtherance of its business, the
Partnership  shall  have  and may  exercise  all  the  powers  now or  hereafter
conferred by the laws of the State of Delaware on partnerships  formed under the
laws of that state,  and shall do any and all things  necessary or desirable for
the  accomplishment  of the above purposes.  The Partnership  shall engage in no
other  business  except as permitted by the  Management  Committee in accordance
with Section 6.2 below.

     2.4 Registered Office of the Partnership.  The Partnership shall maintain a
registered office at, and the name and address of the  Partnership's  registered
agent in Delaware is, The  Corporation  Trust Company,  1209 Orange Street,  New
Castle County, Wilmington, Delaware 19801.

     2.5 Liability of the Partners Generally.



                                      -13-
<PAGE>

          (a) Except as  otherwise  provided in the Delaware  Act,  each General
     Partner shall have the  liabilities  of a partner in a partnership  without
     limited  partners  to Persons  other than the  Partnership  and the Limited
     Partners.

          (b) Except as  otherwise  provided in this  Agreement  or the Delaware
     Act, no Limited  Partner (or former Limited  Partner) shall be obligated to
     make any  contribution  of capital to the Partnership or have any liability
     for the debts and obligations of the Partnership.

     2.6 Office of the Partnership. The Partnership shall maintain an office and
principal  place  of  business  in  Marfa,  Texas.  Pursuant  to the  Management
Agreement, the books of account and other records with respect to the operations
of the Partnership  shall be maintained at 10 Alvin Court,  East Brunswick,  New
Jersey  08816.  The  Partnership  shall not have or maintain any office or other
place of business outside of Marfa, Texas.

     2.7 Duration of the Partnership. The Partnership shall commence on the date
of this  Agreement,  and shall continue until its termination in accordance with
the provisions of Article X.


                                   ARTICLE III
                              CAPITAL CONTRIBUTIONS

     3.1 Capital Contributions.

          (a) Simultaneously with the execution of the Agreement by VF Delaware,
     VF, Cogentrix GP and Cogentrix LP, VF Delaware and VF shall convey,  grant,
     transfer  and assign (or cause to be  conveyed,  granted,  transferred  and
     assigned) to the Partnership all of the Project  Documents,  all the rights
     of Agro Power or any  Affiliate  of Agro Power under the Project  Documents
     and all the assets and  business  of every kind and  description,  wherever
     located, real, personal and mixed, tangible or intangible, owned or held or
     used by Agro Power and any  Affiliate  of Agro Power  solely in  connection
     with the Project  (collectively,  the "Project  Assets").  The  Partnership
     hereby assumes and agrees to pay when due all  liabilities  and obligations
     of Agro Power and any  Affiliate  of Agro Power with respect to the Project
     Assets and agrees to be bound by all of the terms of, and to undertake  all
     of the  obligations of Agro Power and any Affiliate of Agro Power under the
     Project Documents.  For the purposes of the initial Capital Accounts of the
     Partners,  the Project  Assets and  Project  Documents  contributed  to the
     Partnership  by VF  Delaware  and VF shall be deemed  to have an  aggregate
     gross fair market value (net of liabilities) of $1,000.

          If any  consent  or  approval  is  required  in  connection  with  the
     assignment and contribution to the Partnership  pursuant to this subsection
     3.1(a) of any Project  Asset or any Project  Document,  VF Delaware  and VF
     shall have obtained such consent or approval  prior to such  assignment and
     contribution.



                                      -14-
<PAGE>

          (b) Cogentrix GP shall  contribute to the  Partnership on execution of
     this  Agreement by all of the Partners $20 by wire transfer of  immediately
     available funds to an account designated in writing by the Partnership.

          (c) Cogentrix LP shall  contribute to the  Partnership on execution of
     this  Agreement by all of the Partners $980 by wire transfer of immediately
     available funds to an account designated in writing by the Partnership.

     3.2 Additional Capital Contributions. Upon the satisfaction of or waiver of
the  conditions  set forth in Section 3.3  hereof,  on the Equity  Funding  Date
Cogentrix GP shall contribute to the Partnership $132,989 and Cogentrix LP shall
contribute  to the  Partnership  $6,516,445  either  (i)  by  wire  transfer  of
immediately  available  funds  to  an  account  designated  in  writing  by  the
Partnership  or (ii)  payment(s)  to vendors with respect to  obligations  under
Project Documents.

     3.3 Conditions. The obligation of Cogentrix GP and Cogentrix LP to make the
contributions  described in Section 3.2 are subject to the  satisfaction of each
of the following conditions precedent (except those conditions, if any, that may
be  specifically  waived  in  writing  by  Cogentrix  GP  or  Cogentrix  LP,  as
appropriate):

          (a) The Project Credit Facilities and the Project Loan Documents shall
     have  been  approved  by the  Management  Committee  and the  Project  Loan
     Documents  will be executed by all parties  thereto.  An original  executed
     copy of each Project Loan  Document will be delivered to Cogentrix GP and a
     copy thereof delivered to Cogentrix LP as soon as available.

          (b) All  conditions to the closing of the  Construction/Term  Facility
     shall have occurred or been satisfied (other than evidence that the capital
     contributions described in Section 3.2 have been made) and all governmental
     consents,   approvals,   permits  and  licenses  and  other  deliveries  in
     connection  with the  Project  which are  required  to be  received  by the
     Construction/Term   Lender  as  a   condition   to  the   funding   of  the
     Construction/Term  Facility  and the  Revolving  Facility  shall  have been
     delivered or received.  A copy of all such deliveries and other evidence of
     the closing shall be provided to Cogentrix GP and Cogentrix LP.

          (c) The  contribution  by VF Delaware  contemplated  by Section 3.1(a)
     shall have been made to the  satisfaction  of Cogentrix GP and Cogentrix LP
     and evidence thereof reasonably  satisfactory to Cogentrix GP and Cogentrix
     LP shall have been provided to them by VF Delaware.

          (d) The  following  representations  or  warranties  shall be true and
     correct in all respects,  and are hereby made to Cogentrix GP and Cogentrix
     LP  by VF  Delaware  and  VF  as an  inducement  to  their  making  capital
     contributions to the Partnership:

               (i) Each of VF and VF Delaware (A) is a limited liability company
          duly organized,  validly  existing and in good standing under the laws
          of the State of Delaware,  the ownership of which is 99% by Agro Power
          and 1% by VF (in


                                      -15-
<PAGE>

          the case of VF Delaware) or 1% by VF Delaware (in the case of VF), (B)
          has full  power  and  authority  and the  legal  right  to  incur  the
          obligations  provided  for in this  Agreement,  and (C) has  taken all
          necessary action to authorize the execution,  delivery and performance
          of this Agreement and the Project Documents and Project Loan Documents
          to which it is a party.

               (ii) This  Agreement  and the Project  Documents and Project Loan
          Documents to which it is a party have been duly  authorized,  executed
          and delivered by VF Delaware and VF and  constitute  the legal,  valid
          and  binding  obligations  of each of VF Delaware  and VF  enforceable
          against it in accordance  with their terms,  except as  enforceability
          may be limited  by  general  equitable  principles  and by  applicable
          bankruptcy,  insolvency,  reorganization,  moratorium  or similar laws
          affecting the rights of creditors generally.

               (iii)  Neither  the  execution,  delivery  or  performance  by VF
          Delaware or VF of this  Agreement  or any of the Project  Documents or
          Project Loan  Documents to which it is a party,  nor  compliance by it
          with the terms and provisions  hereof or thereof,  including,  without
          limitation, the assignment of the Project Documents and Project Assets
          to the Partnership, requires the consent or authorization of any other
          party (except such as have been duly  obtained),  or conflicts or will
          conflict  with or  result  in a breach  or  violation  of its  charter
          documents or by-laws or any of the terms,  conditions or provisions of
          any Requirement of Law applicable to it or its assets or business.

               (iv) It is not an "investment  company" or a company "controlled"
          by an  "investment  company"  within  the  meaning  of the  Investment
          Company Act of 1940, as amended.

               (v) The  representations  and  warranties of VF Delaware or VF or
          any  of  their  respective  Affiliates  in or  pursuant  to any of the
          Project Documents or Project Loan Documents are true and correct as of
          the date hereof and are hereby  deemed to be made to  Cogentrix GP and
          Cogentrix LP, mutatis mutandis, as if fully set forth herein.

          (e) The  following  representations  or  warranties  shall be true and
     correct in all  respects,  and are  hereby  made to VF  Delaware  and VF by
     Cogentrix GP and  Cogentrix  LP as an  inducement  to their making  capital
     contributions to the Partnership:

               (i) Each of  Cogentrix GP and  Cogentrix LP (A) is a  corporation
          duly organized,  validly  existing and in good standing under the laws
          of the State of  Delaware,  (B) has full power and  authority  and the
          legal right to incur the  obligations  provided for in this Agreement,
          and (C) has taken all  necessary  action to authorize  the  execution,
          delivery and performance of this Agreement.

               (ii) This  Agreement and Project Loan  Documents to which it is a
          party have been duly  authorized,  executed and delivered by Cogentrix
          GP and  Cogentrix  LP and  constitute  the  legal,  valid and  binding
          obligations  of each of


                                      -16-
<PAGE>

          Cogentrix GP and  Cogentrix LP  enforceable  against it in  accordance
          with their terms,  except as enforceability  may be limited by general
          equitable  principles  and  by  applicable   bankruptcy,   insolvency,
          reorganization,  moratorium  or similar laws  affecting  the rights of
          creditors generally.

               (iii) Neither the execution, delivery or performance by Cogentrix
          GP and Cogentrix LP of this  Agreement,  nor compliance by it with the
          terms and provisions hereof,  requires the consent or authorization of
          any other party (except such as have been duly obtained), or conflicts
          or will  conflict  with or  result  in a breach  or  violation  of its
          charter  documents  or  bylaws  or  any of the  terms,  conditions  or
          provisions of any Requirement of Law applicable to it or its assets or
          business.

               (iv) It is not an "investment  company" or a company "controlled"
          by an  "investment  company"  within  the  meaning  of the  Investment
          Company Act of 1940, as amended.

     3.4 Interest.  No interest shall accrue on any  contribution to the capital
of the Partnership.

     3.5 Withdrawals of Capital.  No Partner shall have the right to withdraw or
to be repaid or returned  any capital  contributed  by it,  except as  otherwise
provided herein.

     3.6 Additional Capital  Contributions.  Unless otherwise unanimously agreed
by  the  Management  Committee,  no  Partner  shall  be  required  to  make  any
contribution  to  the  capital  of  the  Partnership   other  than  its  capital
contributions  set forth in this Article III. If the  Management  Committee  has
agreed that an additional cash contribution to the capital of the Partnership is
to be made but a Partner does not make such  contribution  as and when required,
then any other  Partner  may (but shall not be required  to),  at its  election,
either  make all or a portion  of the cash  contribution  to the  capital of the
Partnership  (which,  in the  case of  such an  investment  by  Cogentrix  GP or
Cogentrix LP, would increase the Cogentrix Investment of such Partner or, in the
case of an investment by VF or VF Delaware, would constitute (and in the case of
subsequent investments would increase) an Agro Power Investment of such Partner)
or loan  all or a  portion  of the  amount  of such  non-contributing  Partner's
portion of such agreed-upon cash capital contribution to the Partnership. In the
event the Partner elects to make an additional cash contribution,  the Partner's
ownership  percentage  shall not change  but,  in the case of  Cogentrix  GP and
Cogentrix  LP, the  amount of the  contribution  will  increase  its  respective
Cogentrix  Investment and, in the case of VF and VF Delaware,  would  constitute
(or in the case of subsequent  contributions would increase) its respective Agro
Power  Investment.  (As a result,  for  example,  if  Cogentrix  were to make an
additional cash  contribution to the Partnership under this Section 3.6, and, if
at that  time,  distributions  of cash  from Net  Distributable  Cash are  being
allocated pursuant to Section 5.1(b),  then  distributions  shall continue to be
made under  Section  5.1(b) until  Cogentrix GP and  Cogentrix LP have  received
distributions of cash from Net Distributable Cash that will provide Cogentrix GP
and Cogentrix LP with the Second  Priority  Return on the  Cogentrix  Investment
(which will have been  increased by the amount of such cash  contribution  under
this Section 3.6)).  In the event the Partner  elects to make a loan,  then such
loan  shall be on  customary  terms  and  conditions,  shall be  evidenced  by a
customary  promissory


                                      -17-
<PAGE>

note,  and shall provide that (a) the loan shall be repaid in full together with
interest  thereon prior to any  distribution  of cash by the  Partnership to the
Partners,  (b) it shall  bear  interest  at the  same  rate of  interest  as the
interest rate then in effect under the Revolving  Facility plus 1% per annum and
(c) shall comply in all respects with Project Loan Documents.


                                   ARTICLE IV
                        ALLOCATION OF PROFITS AND LOSSES

     4.1 Profits and Losses.

          (a)  After  giving  effect  to the  special  allocations  set forth in
     Sections 4.3, 4.4, 4.5, 4.6, 4.7 and 4.10 hereof,  the Partners shall share
     Profits and Losses as follows:

               (i) Profits shall be allocated among the Partners as follows:

               (A) Profits  shall first be allocated to the General  Partners to
          offset  any prior  allocations  of Loss made to the  General  Partners
          under  Section  4.1(a)(ii)(B)  hereof which have not  previously  been
          offset.

               (B)  Thereafter,  Profits  shall be  allocated to the Partners to
          offset  any  prior  allocations  of Loss  made to the  Partners  under
          Section 4.1(a)(ii)(A) which have not previously been offset.

               (C) Thereafter, Profits shall be allocated 2% to Cogentrix GP and
          98% to Cogentrix LP until the aggregate  cumulative  Profits allocated
          to Cogentrix GP and Cogentrix LP under this  subsection (C) equals the
          excess of (I) Cumulative  Distributions to Cogentrix over (II) the sum
          of Cumulative Distributions to VF and the Cogentrix Investment.

               (D) Thereafter,  Profits shall be allocated among the Partners in
          proportion to their Partnership Percentages.

               (ii) Losses shall be allocated among the Partners as follows:

               (A) Losses shall first be allocated to the Partners in accordance
          with their positive Capital Accounts.

               (B) Thereafter, Losses shall be allocated to the General Partners
          in the proportion of their Partnership Percentages.

          For Federal  income tax  purposes,  each item of income,  gain,  loss,
     deduction or credit  entering  into the  computation  of the  Partnership's
     taxable income shall be allocated in the same proportion.

          (b) The Profits  and Losses of the  Partnership  shall be  unanimously
     determined by the Management  Committee and shall be allocated as described
     in Section  4.1(a)  (i) at


                                      -18-
<PAGE>

     the end of each fiscal  quarter,  (ii) upon the transfer of the Partnership
     Interest of any Partner pursuant to Article VIII, (iii) upon the Withdrawal
     of any  Partner  pursuant to Article  IX,  (iv) upon the  admission  of any
     Partner to the  Partnership  pursuant  to Article IX and (vi) at such other
     times that the Management Committee may determine.

     4.2 Capital  Account  Balances.  Each  Partner's  Capital  Account shall be
maintained in accordance with the principles of applicable Treasury  Regulations
promulgated  under Section  704(b) of the Code and as otherwise  provided in the
definition of "Capital Accounts" and in this Article IV.

     4.3 Minimum Gain Chargeback.

          (a) Notwithstanding any other provision in this Agreement, if there is
     a net decrease in Partnership  minimum gain  (determined in accordance with
     the principles of Regulations Sections 1.704-2(b)(2) and 1.704-2(d)) during
     any  Partnership  taxable year,  the Partners who would  otherwise  have an
     Adjusted Capital Account Deficit at the end of such year shall be specially
     allocated  items of  Partnership  income  and gain for such year  (and,  if
     necessary,  subsequent  years)  in  an  amount  and  manner  sufficient  to
     eliminate as quickly as possible such Adjusted Capital Account Deficit. The
     items to be so allocated shall be determined in accordance with Regulations
     Section  1.704-2(g).  This subsection 4.3(a) is intended to comply with the
     minimum gain chargeback  requirements in such Regulation Sections and shall
     be interpreted consistently therewith.

          (b) Notwithstanding any other provision in this Agreement, if there is
     a net  decrease  in  Partnership  minimum  gain  attributable  to a partner
     nonrecourse  debt of the  Partnership  (within the  meaning of  Regulations
     Sections  1.704-2(b))  during any Partnership  fiscal year, each Person who
     has  a  share  of  the  Partnership   minimum  gain  attributable  to  such
     nonrecourse  debt  of  the  Partnership,   determined  in  accordance  with
     Regulation  Section  1.704-2(i)(5),  shall be specially  allocated items of
     Partnership  income and gain for such year (and, if  necessary,  subsequent
     years)  in an  amount  equal  to the  greater  of (i) the  portion  of such
     Person's  share of the net  decrease  in  minimum  gain of the  Partnership
     attributable to such  nonrecourse  debt of the  Partnership,  determined in
     accordance with Regulations Section 1.704-2(i)(b), that is allocable to the
     disposition of property of the Partnership subject to such nonrecourse debt
     of the  Partnership,  determined in  accordance  with  Regulations  Section
     1.704-2(i)(4),  or (ii) if such  Person  would  otherwise  have an Adjusted
     Capital  Account  Deficit at the end of such year, an amount  sufficient to
     eliminate such Adjusted  Capital Account Deficit.  Allocations  pursuant to
     the previous sentence shall be made in proportion to the respective amounts
     required to be allocated to each Partner pursuant thereto.  The items to be
     so allocated  shall be determined in accordance  with  Regulations  Section
     1.704-2(i)(4).  This  subsection  4.3(b) is  intended  to  comply  with the
     minimum gain chargeback  requirement in such Regulations  Section and shall
     be  interpreted  consistently  therewith.   Solely  for  purposes  of  this
     subsection 4.3(b),  each Person's Adjusted Capital Account Deficit shall be
     determined prior to any other allocations  pursuant to this Article IV with
     respect to such fiscal year, other than allocations  pursuant to subsection
     4.3(a) hereof.



                                      -19-
<PAGE>

     4.4  Nonrecourse  Deductions.  Nonrecourse  Deductions for any taxable year
shall be  specifically  allocated  among the  Partners  in  proportion  to their
Percentage Interests.

     4.5 Partner Nonrecourse Deductions.  Nonrecourse Deductions attributable to
otherwise  nonrecourse  debt with respect to which a Partner or a related person
of a Partner  described in  Regulations  Section  1.752-2(c)  is the creditor or
otherwise  bears the "economic risk of loss" as defined in  Regulations  Section
1.752-2(b) shall be allocated to such Partner.

     4.6 Qualified Income Offset.  Notwithstanding anything in this Agreement to
the contrary,  in the event any Partner  unexpectedly  receives any adjustments,
allocations or distributions  described in paragraphs  (b)(2)(ii)(d)(4),  (5) or
(6) of Regulations  Section 1.704-1,  there shall be specially allocated to such
Partner  such items of  Partnership  income and gain,  at such times and in such
amounts as will  eliminate  as quickly as possible  that portion of its Adjusted
Capital Account Deficit caused or increased by such adjustments,  allocations or
distributions.

     4.7 Curative  Allocations.  The allocations set forth in Sections 4.3, 4.4,
4.5,  4.6 and 4.10 hereof are intended to comply with  certain  requirements  of
Regulations  Section,  1.704-1(b).  Notwithstanding any other provisions of this
Article IV (other than Sections 4.3, 4.4, 4.5, 4.6 and 4.10),  allocations  that
have taken place pursuant to Sections 4.3, 4.4, 4.5, 4.6 and 4.10 shall be taken
into account in  allocating  other items of income,  gain,  loss,  deduction and
credit so that, to the extent possible, the net amount of such other allocations
and the Sections 4.3, 4.4, 4.5, 4.6, and 4.10  allocations to each Partner shall
equal the net  amount  that  would have been  allocated  to each  Partner if the
Sections 4.3, 4.4, 4.5, 4.6, and 4.10 allocations had not occurred.

     4.8 Tax Allocations. Except as provided in Sections 4.7 and 4.9 hereof, for
income tax  purposes  each item of income,  gain,  loss and  deduction  shall be
allocated in the same manner as the  corresponding  book item is  allocated  for
Capital Account purposes.

     4.9 Property  Subject to 704(b) and 704(c).  In the case of any Partnership
asset (directly or indirectly owned) the Gross Asset Value of which differs from
its adjusted tax basis,  income,  gain,  loss and deduction with respect to such
asset  shall,  solely for tax  purposes,  be allocated  in  accordance  with the
principles  of  Code  Sections  704(b)  and  704(c)  to  take  account  of  such
difference.

     4.10 Limitations.  Notwithstanding anything to the contrary in this Article
IV, no allocation  under this Article IV shall be made to a Limited Partner that
would cause such Limited  Partner to have, or that would  increase,  an Adjusted
Capital Account Deficit. Any amount not allocated as a result of this limitation
shall be reallocated to the General  Partners pro rata in accordance  with their
relative Partnership Interests.




                                      -20-
<PAGE>

                                    ARTICLE V
                                  DISTRIBUTIONS

     5.1 Distribution of Net Distributable Cash. Subject to Sections 5.2 and 5.3
hereof,  Net Distributable  Cash for each fiscal quarter shall be distributed to
the Partners within thirty (30) days after the end of such quarter as follows:

          (a) First,  from the date  hereof and until each of  Cogentrix  GP and
     Cogentrix  LP  shall  have   received   distributions   of  cash  from  Net
     Distributable Cash sufficient to provide both Cogentrix GP and Cogentrix LP
     with the First  Priority  Return,  89.1% to Cogentrix LP, 0.9% to Cogentrix
     GP, 9.9% to VF and 0.1% to VF Delaware,

          (b) Thereafter  until each of Cogentrix GP and Cogentrix LP shall have
     received  distributions of cash from Net  Distributable  Cash sufficient to
     provide both Cogentrix GP and Cogentrix LP with the Second Priority Return,
     64.386% to Cogentrix LP, 1.314% to Cogentrix GP,  33.614% to VF, and 0.686%
     to VF Delaware, and

          (c) Thereafter, 49% to Cogentrix LP, 1% to Cogentrix GP, 49% to VF and
     1% to VF Delaware.

     5.2 Default Allocations for Cogentrix. In the event VF Delaware, VF or Agro
Power  defaults or breaches any of its  obligations  under this  Agreement,  the
Management Agreement,  the Marketing Agreement or the Construction Agreement and
such default or breach has not been remedied  within any applicable cure period,
or any  representation  or  warranty  made by VF  Delaware,  VF or any of  their
respective  Affiliates  under  this  Agreement  or any such other  agreement  or
document  proves to have been untrue  when made and (a) as a result  thereof the
Partnership, Cogentrix GP and Cogentrix LP (or any of them) incurs or suffers an
Adverse Consequence and (b) Cogentrix GP or Cogentrix LP gives written notice of
such  Adverse  Consequence  to the  Partnership  and,  if the amount  thereof is
unknown, its good faith estimate of the amount of such Adverse Consequence, then
the Partnership  shall  thereafter  refrain from making any  distributions to VF
Delaware and VF (or either of them) under this Agreement (any such  distribution
that would have been made but for this Section 5.2 is hereinafter referred to as
a "Blocked Distribution") and shall take the following steps:

          (i) The Partnership  shall  distribute to Cogentrix GP or Cogentrix LP
     from such Blocked  Distributions  an aggregate  amount equal to 100% of any
     such Adverse Consequence  suffered or actually incurred by Cogentrix GP and
     Cogentrix  LP or either of them (or,  if the  amount  thereof is not known,
     100% of  Cogentrix  GP's or  Cogentrix  LP's  written  good faith  estimate
     thereof).  Any  such  distribution  made  by  the  Partnership  under  this
     subsection 5.2(i) shall satisfy pro tanto the obligation of the Partnership
     to make  distributions  to VF  Delaware  and VF (or  either  of them)  with
     respect to the Blocked  Distributions.  For the purposes of this Agreement,
     any Adverse  Consequence  suffered or incurred by the Partnership  shall be
     deemed to have been suffered or incurred, on a dollar-for-dollar  basis, 1%
     by Cogentrix GP and 49% by Cogentrix LP.

          (ii) Upon distribution to Cogentrix GP and Cogentrix LP of 100% of the
     aggregate  amount of any such  Adverse  Consequence  (or their  good  faith
     estimate   thereof)


                                      -21-
<PAGE>

     from  Blocked   Distributions,   the   Partnership   may  thereafter   make
     distributions  to VF Delaware and VF under Section 5.1, unless and until it
     receives a subsequent  notification from Cogentrix LP or Cogentrix GP under
     this Section 5.2.

     5.3 Default  Allocations  for VF. In the event Cogentrix GP or Cogentrix LP
defaults  or  breaches  any of its  obligations  under this  Agreement  and such
default or breach has not been remedied  within any applicable  cure period,  or
any  representation  or warranty made by Cogentrix GP or Cogentrix LP under this
Agreement  proves to have been untrue when made and (a) as a result  thereof the
Partnership,  VF Delaware  and VF (or any of them)  incurs or suffers an Adverse
Consequence  and (b) VF  Delaware  or VF gives  written  notice of such  Adverse
Consequence to the Partnership  and, if the amount thereof is unknown,  its good
faith estimate of the amount of such Adverse  Consequence,  then the Partnership
shall  thereafter  refrain  from making any  distributions  to  Cogentrix GP and
Cogentrix  LP (or either of them) under this  Agreement  (any such  distribution
that would have been made but for this Section 5.3 is hereinafter referred to as
a "Blocked Distribution") and shall take the following steps:

          (i) The  Partnership  shall  distribute to VF Delaware or VF from such
     Blocked Distributions an aggregate amount equal to 100% of any such Adverse
     Consequence  suffered or actually  incurred by VF Delaware and VF or either
     of them (or, if the amount  thereof is not known,  100% of VF Delaware's or
     VF's written good faith estimate  thereof).  Any such  distribution made by
     the Partnership  under this  subsection  5.3(i) shall satisfy pro tanto the
     obligation  of the  Partnership  to make  distributions  to Cogentrix GP or
     Cogentrix LP (or either of them) with respect to the Blocked Distributions.
     For the purposes of this  Agreement,  any Adverse  Consequence  suffered or
     incurred  by the  Partnership  shall be  deemed to have  been  suffered  or
     incurred, on a dollar-for-dollar basis, 1% by VF and 49% by VF Delaware.

          (ii) Upon  distribution to VF Delaware and VF of 100% of the aggregate
     amount of any such  Adverse  Consequence  (or  their  good  faith  estimate
     thereof) from Blocked  Distributions,  the  Partnership may thereafter make
     distributions  to Cogentrix GP and Cogentrix LP under  Section 5.1,  unless
     and until it  receives a  subsequent  notification  from VF  Delaware or VF
     under this Section 5.3.




                                      -22-
<PAGE>

                                   ARTICLE VI
                                   MANAGEMENT

     6.1 Management of the Partnership.

          (a) The overall  management and control of the business affairs of the
     Partnership  shall be vested in the  Management  Committee,  subject to the
     limitations  contained in Section 6.2 or elsewhere in this  Agreement.  The
     Management  Committee  shall  consist of four  members,  two  designated by
     Cogentrix GP (each a "Cogentrix  GP  Designee")  and two  designated  by VF
     Delaware  (each a "VF Delaware  Designee"),  and a quorum of the Management
     Committee shall require at least three members of the Management Committee.
     No action at any meeting may be taken by the Management  Committee unless a
     quorum is present (acting in person or by proxy). The Management  Committee
     shall meet not less frequently  than  quarterly.  Members of the Management
     Committee may participate in a meeting of the Management Committee by means
     of conference telephone. No action may be taken by the Management Committee
     with respect to any of the matters  described in Section 6.2 hereof  unless
     such  action  is in the form of a  writing  signed  by all  members  of the
     Management  Committee.   Unless  otherwise  agreed,  all  meetings  of  the
     Management  Committee shall take place at Cogentrix's offices in Charlotte,
     North Carolina, Agro Power's offices in East Brunswick,  New Jersey or such
     other place as the Management Committee may unanimously agree.

          (b) Except as set forth in Section 6.2,  any action by the  Management
     Committee  shall  require the  approval of a majority of the members of the
     Management Committee.

          (c)  Any  General  Partner  may,  at  any  time,  replace  any  of its
     respective  Designees to the Management  Committee with a new Designee and,
     upon such  change,  or upon the death or  resignation  of any  Designee,  a
     successor  shall be designated  in writing by the party that  appointed the
     Designee being replaced.

          (d) Any General Partner or member of the Management  Committee may, at
     any time, request a meeting of the Management  Committee by sending written
     notice  specifying in reasonable  detail the  purpose(s) of such meeting to
     all other Partners and to the members of the Management  Committee at least
     ten (10) days in advance of the proposed date for the meeting, which notice
     may be waived by all members of the Management  Committee and all Partners.
     Any  member  of the  Management  Committee  may  propose  that an action be
     submitted to the Management  Committee for approval,  and there shall be no
     requirement  of notice of the issues to be  addressed at any meeting of the
     Management Committee.

     6.2  Fundamental  Matters.  The  following  matters shall require the prior
unanimous authorization and approval of the Management Committee:

          (a) Any transaction in which the  Partnership (i) acquires,  purchases
     or leases any asset or right for  consideration  having a fair market value
     in excess of $25,000,  (ii)  consolidates  or merges with or into any other
     Person,  (iii) sells,  assigns,  leases or


                                      -23-
<PAGE>

     otherwise transfers any asset or right having a fair market value in excess
     of $25,000,  or (iv) assumes any liability or obligation in connection with
     Section 6.2(a)(i) above in excess of $25,000.

          (b) The approval,  execution  and delivery of any  contract,  lease or
     agreement  following the Effective  Date;  provided,  that no such approval
     shall  be  required  for (i)  any  contracts  and  permit  applications  in
     existence prior to the Effective Date and listed on Schedule 1.1(c) hereto,
     or  (ii)  any  other  contract,  lease  or  agreement  which  is  expressly
     non-recourse  to the  Partners  so  long as the  amounts  to be paid by the
     Partnership  thereunder,  together with all other amounts to be paid by the
     Partnership pursuant to contracts,  leases or agreements that have not been
     unanimously  approved  or ratified by the  Management  Committee,  does not
     exceed $50,000 in the aggregate excluding  contracts,  leases or agreements
     for supplies used in the ordinary  course of business and  contemplated  in
     the Operating Budget.

          (c)  The  approval,  execution  or  delivery  of  any  amendments  to,
     modification  or  termination  of,  enforcement  of  rights  under,  or any
     consents or waivers in connection  with any  contract,  lease or agreement,
     other than contracts  entered into without prior unanimous  approval of the
     Management  Committee  pursuant  to  subsection  6.2(a) or  clause  (ii) of
     subsection 6.2(b) above.

          (d) The sale or issuance by the Partnership of any interest, or of any
     option,  warrant or similar right to acquire any  interest,  of any kind in
     the Partnership.

          (e) Any decision to (i) terminate all or any  substantial  part of the
     Project (an  "Abandonment") or (ii) engage in any activity not contemplated
     by this Agreement.

          (f)  The  incurrence  or  assumption  of  any   Indebtedness   by  the
     Partnership,  except for (i) Indebtedness  which, when the principal amount
     thereof is aggregated with the principal amount of Indebtedness  previously
     incurred pursuant to this subsection 6.2(f) which remains outstanding, does
     not exceed  $25,000 and (ii) the  Indebtedness  represented  by the Project
     Loan Documents.

          (g) The  granting  of any Lien  (other  than  Permitted  Liens) on the
     assets or rights of the Partnership.

          (h) The  repayment  (other  than (i)  repayments  in  accordance  with
     scheduled  maturity and (ii)  paydowns on the Revolving  Credit  Facility),
     voluntary  prepayment  or  redemption  of,  or  any  refinancing  or  other
     modification of the terms of, any Indebtedness.

          (i) The  adoption  and  modification  of the  Operating  Budget or the
     Project Budget (collectively, the "Budgets").

          (j) The  approval of any  expenditure  or  investment  not  previously
     authorized in any Budget; provided, however, that no such approval shall be
     required for any  expenditure or investment so long as the amount  expended
     by the Partnership,  together with the amounts of all other expenditures by
     the  Partnership  during any  fiscal  year that


                                      -24-
<PAGE>

     have not been approved or ratified by the  Management  Committee,  does not
     exceed $25,000 in the aggregate.

          (k) The  initiation of any legal  proceedings or arbitration on behalf
     of the  Partnership,  or the  settlement  of any  claim by or  against  the
     Partnership  with  respect to claims in excess of $25,000 or which  include
     requests for an injunction, specific performance or other equitable relief.

          (l)  The  selection,   removal,  or  determination  of  authority  and
     responsibility  of the  officers  of the  Partnership,  general  or special
     counsel for the  Partnership,  accountants and auditors for the Partnership
     and the Project and the  approval  of any change in the  accounting  or tax
     policy of the Partnership or the Project.

          (m)  To  the  extent  not  specified  in  this   Agreement,   (i)  any
     distribution  of income or any assets or rights of the  Partnership or (ii)
     the  redemption,  purchase  or other  acquisition  of any  interest  in the
     Partnership.

          (n) Except as contemplated in Article X of this Agreement, liquidating
     or  dissolving,  or proposing to liquidate or dissolve,  or  effecting,  or
     proposing to effect, a recapitalization in any form of transaction,  of the
     Partnership.

          (o) (i) Commencing any case,  proceeding or other action (A) under any
     existing or future law or any jurisdiction,  domestic or foreign,  relating
     to bankruptcy, insolvency,  reorganization or relief of debtors, seeking to
     have  an  order  for  relief   entered  with  respect  to  it,  or  seeking
     reorganization,    arrangement,    adjustment,   winding-up,   liquidation,
     dissolution,  composition  or other relief with respect to it or its debts,
     or (B) seeking  appointment  of a  receiver,  trustee,  custodian  or other
     similar  official for it or for All or any substantial  part of its assets;
     (ii) making, or proposing to make, a general  assignment for the benefit of
     its  creditors;  (iii)  admitting  or  proposing  to admit in  writing  its
     inability to pay its debts as they become due;  (iv) filing or proposing to
     file any plan of  reorganization  pursuant to 11 U.S.C.  " 101 et seq.; (v)
     taking,  or proposing to take, any action in furtherance  of, or indicating
     its consent to, approval of or  acquiescence  in, any of the acts set forth
     in clause (i) or (ii) above.

          (p)  Establishing  any operating or capital  reserves other than those
     required by the Project Loan Documents.

          (q) Establishing committees of the Management Committee and delegating
     voting authority to such committees.

          (r)  The  approval,  execution  or  delivery  of  any  amendments  to,
     modification  or termination of, or any waivers of any rights under, or the
     grant of any consents under or in connection with any Project Document, any
     Project Loan Document, the Marketing Agreement or the Management Agreement.



                                      -25-
<PAGE>

          (s) The  approval  or taking of any  action  that would be an event of
     default or that would give rise to a right of termination under any Project
     Document or any Project Loan Document.

          (t) The  approval or taking with any action that would give rise to an
     event of default under any Project Loan Document or that would give rise to
     a right of acceleration or termination under any Project Loan Document.

          (u) The  reimbursement by the Partnership of any General Partner under
     Section  6.4(b)  hereof of any amount in excess of $5,000 during any fiscal
     quarter.

          (v) Any change in or termination of any insurance policies  maintained
     by the Partnership.

          (w) Any  agreement  to  undertake  any action  that would  require the
     approval of the Management Committee under this Section 6.2.

          (x) Any act in contravention of this Agreement or the Act.

          (y) Any act which would make it  impossible  to carry on the  ordinary
     business of the Partnership.

          (z)  Possession  of  Partnership  property  by  any  Partner,  or  the
     assignment,  transfer  or pledge of rights of the  Partnership  in specific
     Partnership property for other than a Partnership purpose or other than for
     the  benefit  of the  Partnership,  or any  commingling  the  funds  of the
     Partnership with the funds of any other person.

          (aa) Any action  which  would cause the  Partnership  to be treated as
     other than a partnership for Federal income tax purposes.

          (ab) Any  confession  of a judgment  against  the  Partnership  or any
     Partner.

          (ac) The grant of any power of attorney or appointment of any agent or
     attorney (other than customs brokers).

          (ad) The grant of  signature  authority  to any Person with respect to
     any of the Partnership's bank or investment accounts.

     6.3 Officers of the Partnership.  The Partnership may have such officers as
may be designated by the Management  Committee from time to time.  Such officers
shall (a) serve at the  pleasure  of the  Management  Committee,  (b) subject to
Section 6.2 and to the instructions and directions of the Management  Committee,
have such powers as are usually exercised by comparable designated officers of a
Delaware  corporation and (c) have the power to bind the Partnership through the
exercise  of such powers to the extent  consistent  with the terms  hereof.  The
initial  officers of the  Partnership  shall be those persons listed on Schedule
6.3  attached  hereto  and  incorporated  herein  by  reference.  Following  the
execution  hereof,  officers shall be


                                      -26-
<PAGE>

appointed or removed only by action of the  Management  Committee in  accordance
with the provisions of Section 6.1.

     6.4 No Compensation; Reimbursement.

          (a) Except as expressly provided herein, the General Partners, members
     of the Management  Committee and officers shall receive no compensation for
     performing  their  duties as General  Partners,  members of the  Management
     Committee or officers under this Agreement;  provided,  however,  that this
     provision  shall not affect  any  Partners'  right to receive  its share of
     distributions as set forth in Article V hereof.

          (b) Subject to the  limitation,  if any,  imposed by the Project  Loan
     Documents and subject to subsection  6.2(u),  each General Partner shall be
     entitled to  receive,  out of any  Partnership  funds  available  therefor,
     reimbursement of all amounts expended by such General Partner in payment of
     properly  incurred  and  documented  Partnership  obligations  paid by such
     General Partner out of its own funds so long as such  expenditures are made
     in accordance with the Budgets.

     6.5  Insurance.  The  Partnership  shall (a)  maintain,  with  insurers  or
underwriters  of good repute,  in the name of the  Partnership,  such  insurance
relating to the  operations of the  Partnership  as is customary for  comparable
businesses  to that of the  Partnership  to  maintain,  against  such  risks and
pursuant to such terms (including deductible limits or self-insured  retentions)
as are  customary for such  businesses,  and (b) pay all premiums and other sums
payable in order to maintain  such  insurance.  For  purposes of clarity,  it is
hereby agreed that the Partnership shall maintain the insurance  required by the
Project Loan Documents and all insurance policies shall name Cogentrix GP and VF
Delaware as an additional insured and provided that they may not be cancelled or
terminated  except with 30 days' prior  written  notice to  Cogentrix  GP and VF
Delaware.

     6.6 Cooperation on Tax Matters.  The  Partnership  shall cooperate fully as
and to the  extent  reasonably  requested  by  Cogentrix  GP or VF  Delaware  in
connection with the preparation and filing of any Tax return, statement,  report
or form,  and any audit,  litigation or other  proceeding  with respect to Taxes
relating to or arising out of the Project.  Such  cooperation  shall include the
retention and, upon request by either Cogentrix GP or VF Delaware, the provision
of records  and  information  that are  reasonably  relevant  to any such audit,
litigation or other proceeding.  The Partnership  agrees to (a) retain all books
and records  with  respect to Tax matters  pertinent to the Project and (b) give
Cogentrix GP and VF Delaware  reasonable  written  notice prior to destroying or
discarding any such books and records.  The Partnership shall retain any records
requested by either Cogentrix GP or VF Delaware to be retained.


                                   ARTICLE VII
                        BOOKS, RECORDS AND BANK ACCOUNTS

     7.1  Books  and  Records.   In  addition  to  the  Partnership  Books,  the
Partnership shall also keep such books of account and other records with respect
to  the  operations  of  the  Partnership  as  will  sufficiently   explain  the
transactions  and financial  position of the  Partnership


                                      -27-
<PAGE>

and enable financial statements to be prepared in accordance with GAAP and shall
cause such books and other records to be kept in such manner as will enable them
to be properly  audited.  The Partnership Books and such other books and records
shall be maintained at the principal  places of business of the  Partnership and
all Partners and their duly authorized  representatives  shall at all times have
access to and the right to review and copy such books and records.

     7.2  Accounting  Basis and Fiscal Year.  The books of the  Partnership  (a)
shall be kept on an accrual basis in accordance with GAAP, (b) shall reflect all
Partnership  transactions,  (c)  shall  be  appropriate  and  adequate  for  the
Partnership's  business  and  for the  carrying  out of all  provisions  of this
Agreement,  and (d) shall be closed and  balanced  as of the end of each  fiscal
year, as soon as practicable  after the end of such fiscal year. The fiscal year
of the Partnership  shall be January 1 through  December 31 of each year or such
other  fiscal  year that may be  selected  with the  unanimous  approval  of the
Management Committee.

     7.3 Reports.

          (a)  Unless  otherwise  required  by  the  Management  Committee,  the
     Partnership  shall cause to be delivered to each  Partner,  within 120 days
     after  the end of  each  fiscal  year,  an  annual  report  containing  the
     following:

               (i) A  balance  sheet as of the end of the  Partnership's  fiscal
          year and statements of income, Partners' equity and cash flows for the
          year then ended,  each of which  shall be audited  and  reported on by
          Arthur  Andersen  & Co. or such  other  independent  certified  public
          accountants,  which shall be a nationally  recognized accounting firm,
          as may be selected by the Management Committee;

               (ii) a general  description of the activities of the  Partnership
          during such year; and

               (iii)  a  report  of  any   material   transaction   between  the
          Partnership and any Partner or any of its  Affiliates,  including fees
          and  compensation and  reimbursements  paid by the Partnership and the
          products  supplied and services  performed by such Partner or any such
          Affiliate  for  such  fees  or   compensation   and  the  expenses  so
          reimbursed;  provided,  however,  that no report shall be required for
          any  products  supplied and  services  performed if such  products and
          services are provided pursuant to the terms of a Project Document, the
          Management Agreement,  the Marketing Agreement,  an agreement approved
          by  the  Management  Committee  or  set  out in  any  Budget  and  the
          compensation  therefor  is  in  accordance  with  the  terms  of  such
          agreement.

          (b) Within 45 days after the end of each  quarter of each fiscal year,
     the  Partnership  shall cause to be  delivered  to each Partner a quarterly
     report  containing  a  balance  sheet as of the end of such  quarter  and a
     statement of income for such  quarter,  each of which may be unaudited  but
     which shall be certified by the chief financial  officer of the Partnership
     as fairly  presenting the financial  position of the Partnership at the end
     of such  quarter  and results of  operations  of the  Partnership  for such
     quarter  and as having  been  prepared in  accordance  with the  accounting
     methods  followed by the  Partnership  for


                                      -28-
<PAGE>

     Federal  income tax purposes and otherwise in accordance  with GAAP applied
     on a basis substantially  consistent with that of the Partnership's audited
     financial statements (subject to normal year end adjustments).

          (c) Within 120 days of the end of each fiscal  year,  the  Partnership
     will cause to be delivered to each Partner all  information  necessary  for
     the preparation of such Partner's  Federal income tax returns,  including a
     statement showing such Partner's share of income, gains, losses, deductions
     and credits for such year for Federal income tax purposes and the amount of
     any  distributions  made to or for the account of such Partner  pursuant to
     this Agreement.

     7.4 Bank Accounts.  The Partnership  shall maintain one or more accounts in
one or more banks  located in Marfa,  Texas and such other  locations  as may be
approved  by the  Management  Committee,  each of which  shall  be a member  the
Federal  Deposit  Insurance  Corporation.  In addition,  the  Partnership  shall
establish  such other  accounts  and deposit  amounts as required by the Project
Loan  Documents.  All such  amounts  shall be and  remain  the  property  of the
Partnership,  and shall be received,  held and disbursed by the  Partnership for
the purposes specified in this Agreement. There shall not be deposited in any of
said accounts any funds other than funds  belonging to the  Partnership,  and no
other funds shall in any way be commingled with such Partnership funds.

     7.5 Tax Returns.  The Management  Committee  shall cause income tax returns
for the  Partnership  to be  prepared  and  timely  filed  with the  appropriate
authorities.

     7.6 Tax Elections.  The Management Committee shall, from time to time, make
such tax elections as it deems  necessary or advisable to carry out the business
of the Partnership or the purposes of this Agreement.

     7.7 Tax  Matters  Partner.  Cogentrix  GP shall be the  Partnership's  "tax
matters partner" for purposes of the Code and with respect to all other Federal,
state and local Taxes. The approval of the tax matters partner shall be required
before the  Partnership  or any Partner  (with respect to  Partnership  matters)
files any document with any Governmental  Authority  including,  but not limited
to, returns, amendments, requests for refunds, appeals, or waivers or extensions
of statutes of  limitations.  The tax matters partner shall take such actions as
the  Management   Committee  may  lawfully   require  in  connection   with  the
Partnership's Federal, state and local Tax matters.

     7.8 Withholdings.  Except and only to the extent required by applicable law
and except as permitted  hereunder,  the Partnership will not deduct or withhold
any  amount  in  respect  of any tax from any  payment  or  distribution  by the
Partnership to any Partner  unless the  Partnership  has first received  written
authorization from such Partner so to withhold or to deduct.




                                      -29-
<PAGE>

                                  ARTICLE VIII
                              TRANSFER OF INTERESTS

     8.1 Transfer of a Partner's Interest.

          (a) No Partner may sell,  transfer,  participate,  assign or otherwise
     dispose of (whether  voluntarily  or by  operation  of law)  (collectively,
     "transfer") all or any part of its Partnership  Interest  without the prior
     written consent of the non-transferring General Partner(s).

          (b) The non-transferring  General Partner(s) may condition its (their)
     consent to any transfer on compliance  by the Partner  desiring to transfer
     its Partnership Interest with all or any of the following:

               (i) The  transferring  Partner  must give  written  notice to the
          General  Partners   identifying  in  reasonable  detail  the  proposed
          transferee(s)  and the terms and  conditions of the proposed  transfer
          and the  non-transferring  General  Partner(s)  shall have a period of
          twenty  (20)  Business  Days  from the date of such  notice  either to
          consent in writing to the proposed  transferee(s),  or to give written
          notice that it does not consent to such transferee(s);

               (ii)  within ten (10)  Business  Days after the  non-transferring
          General  Partner(s) gives written notice that it does not consent to a
          proposed  transferee,  it shall provide to the transferring  Partner a
          written explanation of the reasons therefor;

               (iii) such  transfer  does not release the  transferring  Partner
          from its obligations hereunder;

               (iv) the  transferee  shall not have the  right to be  separately
          represented  on  the  Management  Committee  unless  the  transferring
          Partner is a General  Partner that previously had the right to appoint
          Designee's to the Management  Committee and the transfer  involves all
          of such General Partner's Partnership Interest;

               (v) the  non-transferring  General  Partner(s)  shall notify each
          other  Partner in writing of its  decision to consent to the  transfer
          within  five (5)  Business  Days of its grant of such  consent  (which
          notice shall include a copy of the notice sent to the non-transferring
          General Partner(s) by the transferring Partner) and, prior to any such
          transfer, each Partner (which term, for purposes of clarity,  includes
          for  purposes  of this  subsection  (v) the  non-transferring  General
          Partner and excludes the  transferring  Partner)  shall have the right
          for thirty (30)  Business Days  following  such notice to purchase the
          Partnership  Interest being sold by the transferring  Partner pursuant
          to this  Article  VIII on the same  terms and  conditions  as were set
          forth in such  notice.  In the event that none of the  nontransferring
          Partners  exercises  its right to purchase such  Partnership  Interest
          being sold, then the  transferring  Partner shall have forty-five (45)
          days  thereafter to complete the


                                      -30-
<PAGE>

          sale in accordance with the terms of the notice,  after which time the
          transferring  Partner must again comply with the  procedures set forth
          in this Article VIII. In the event more than one Partner exercises its
          right  to  purchase   such   Partnership   Interest   proposed  to  be
          transferred,  then such exercising  Partners shall exercise such right
          on a pro-rata basis based on their respective Partnership  Percentages
          (without  considering the Partnership  Percentage of the  transferring
          Partner or the Partners (if any) not electing to exercise such right);
          or

               (vi) such transferee shall not have the right to sell,  transfer,
          participate,  assign or otherwise  dispose of all or a portion of such
          party's  Partnership  Interest  except in accordance with the terms of
          this Section 8.1; and

               (vii) the transferee shall execute documents  satisfactory to the
          Management  Committee sufficient to make the transferee a party to and
          be  bound by the  terms of this  Agreement  and the  transferee  shall
          expressly   assume  all  obligations  of  the   transferring   Partner
          hereunder.


                                   ARTICLE IX
                   ADDITIONAL PARTNERS; WITHDRAWAL OF PARTNERS

     9.1 Additional  Partners.  Persons other than the undersigned may from time
to time be admitted to the Partnership as General  Partners or Limited  Partners
only with the  unanimous  consent of the  Management  Committee and only on such
terms and conditions as may be prescribed by the Management Committee.

     9.2 Withdrawal of Partners.

          (a) No Partner may withdraw from the Partnership except as provided in
     this Section 9.2.

          (b) A Partner  shall  immediately  cease to be a Partner  and shall be
     deemed to have Withdrawn from the Partnership, in the event:

               (i)  Such  Partner  shall  commence  a  voluntary  case or  other
          proceedings seeking  liquidation,  reorganization or other relief with
          respect to itself or its debts  under any  bankruptcy,  insolvency  or
          other   similar  law  now  or  hereafter  in  effect  or  seeking  the
          appointment  of a trustee,  receiver,  liquidator,  custodian or other
          similar  official of it or any  substantial  part of its property,  or
          shall  consent to any such relief or to the  appointment  of or taking
          possession  by any  such  official  in an  involuntary  case or  other
          proceeding  commenced  against it, or shall make a general  assignment
          for the benefit of creditors, or shall fail generally to pay its debts
          as they become due, or shall take any  corporate  action to  authorize
          any of the foregoing; or

               (ii) an involuntary  case or other  proceeding shall be commenced
          against  such Partner  seeking  liquidation,  reorganization  or other
          relief  with


                                      -31-
<PAGE>

          respect to it or its debts under any  bankruptcy,  insolvency or other
          similar law now or hereafter in effect or seeking the appointment of a
          trustee, receiver, liquidator,  custodian or other similar official of
          it or any substantial part of its property,  and such involuntary case
          or other proceeding shall remain undismissed and unstayed for a period
          of sixty (60) days,  or an order for relief  shall be entered  against
          such Partner under the federal  bankruptcy laws as now or hereafter in
          effect; or

               (iii) such Partner  defaults in its  obligation to make a capital
          contribution pursuant to Sections 3.1 and 3.2 (and such default is not
          cured  within two (2) days of written  notice of such  default  from a
          General Partner); or

               (iv) it is  required  to  Withdraw  as a Partner  pursuant to the
          Delaware Act.

Such Partner's Withdrawal Date shall be the day such Withdrawal occurs.

          (c) Any Partner may Withdraw  voluntarily  from the Partnership on not
     less than  thirty (30) days' prior  written  notice by such  Partner to the
     other Partners  either (i) in the event that such  Withdrawal is after July
     1,  1997  and  the  conditions  to  the  initial  draw  under  each  of the
     Construction/Term  Facility  Documents and the Revolving  Facility have not
     been satisfied or (ii) with the prior  unanimous  consent of the Management
     Committee.  Such  Partner's  Withdrawal  Date  shall be the date on which a
     written notice of Withdrawal is made.

          (d) Upon the Withdrawal of any Partner pursuant to subsections  9.2(b)
     or (c), such Partner's Capital Account and Partnership  Percentage shall be
     allocated,  as  of  the  Withdrawal  Date,  among  the  other  Partners  in
     proportion to their respective  Partnership  Percentages on such Withdrawal
     Date (it being  understood  that  such  allocation  shall  not  result in a
     Limited Partner becoming a General  Partner).  After its Withdrawal Date, a
     Withdrawn  Partner  shall not have any rights with  respect to the profits,
     capital or affairs of the Partnership  (including,  but not limited to, any
     rights of  representation  on the  Management  Committee  or any  committee
     thereof or any rights on liquidation of the Partnership pursuant to Article
     X).

          (e) On the Withdrawal Date for any Partner that Withdraws  pursuant to
     Section  9.2(b)  or  Section  9.2(c)(ii),  such  Partner  shall  pay to the
     Partnership in cash any negative balance in such Partner's capital account.
     If the sum of such Partner's  capital account has a positive balance on the
     Withdrawal Date, the Partnership shall pay such amount to such Partner upon
     its withdrawal.




                                      -32-
<PAGE>

                                    ARTICLE X
                           DISSOLUTION AND LIQUIDATION

     10.1 Events of Dissolution.

          (a) The Partnership shall be dissolved upon:

               (i) an Abandonment pursuant to subsection 6.2(e);

               (ii) the occurrence of an event requiring  dissolution  under the
          Delaware Act;

               (iii) the unanimous consent of the General Partners; or

               (iv) at the election of Cogentrix  GP, if Agro Power  ceases,  at
          any time, to control (as defined in the definition of  "Affiliate") VF
          Delaware or VF.

          (b)  Dissolution of the  Partnership  shall be effective on the day on
     which the event occurs giving rise to the dissolution,  but the Partnership
     shall not terminate  until the assets and rights of the  Partnership  shall
     have been distributed as provided herein.  Notwithstanding  the dissolution
     of the  Partnership,  prior  to the  termination  of  the  Partnership,  as
     aforesaid, the business of the Partnership and the affairs of the Partners,
     as such, shall continue to be governed by this Agreement. Upon dissolution,
     the Management  Committee shall liquidate the assets of the Partnership and
     apply  and  distribute  the  proceeds   thereof  as  contemplated  by  this
     Agreement.

     10.2 Distributions Upon Liquidation.

          (a) After payment of liabilities owing to creditors (but excluding any
     liabilities  payable  with  respect  to  the  Management  Agreement  or the
     Marketing  Agreement other than amounts then due and owing), the Management
     Committee or the liquidator, if any, shall set up such reserves as it deems
     reasonably  necessary  for any  contingent  or  unforeseen  liabilities  or
     obligations of the Partnership  (other than liability and obligation  owing
     with respect to the Management Agreement and the Marketing Agreement). Said
     reserves may be paid over by the Management  Committee or the liquidator to
     a bank, to be held in escrow for the purpose of paying any such  contingent
     or unforeseen  liabilities  or  obligations  and, at the expiration of such
     period as the Management  Committee or the  liquidator may deem  advisable,
     such reserves  shall be distributed to the Partners or their assigns in the
     manner set forth in subsection (b) below.

          (b) If any General Partner has a negative  Capital Account at the time
     of dissolution of the  Partnership,  such General Partner shall be required
     to restore to the  Partnership  the amount of the  negative  balance in its
     Capital  Account.  If any Limited  Partner has a negative  Capital  Account
     balance at the time of dissolution of the Partnership, such Limited Partner
     shall have no  obligation to restore to the  Partnership  the amount of the
     negative balance in its Capital Account.



                                      -33-
<PAGE>

          (c) After  paying  the  liabilities  and  providing  for the  reserves
     referred  to in  subsection  10.2(a)  and the  payment  of any  restoration
     amounts  under  subsection  10.2(b),   the  Management   Committee  or  the
     liquidator shall, by the end of the Partnership's taxable year in which the
     Partnership  dissolves (or, if later, within 90 days after the date of such
     termination),  cause the net assets of the Partnership to be distributed in
     accordance with Article V hereof,  provided,  however, that no distribution
     shall be made pursuant to this sentence that creates or increases a Capital
     Account deficit for any Partner which exceeds such Partner's  obligation to
     restore  such deficit  (under  subsection  10.2(b)  above),  determined  as
     follows:

               Distributions  shall be first  determined  provisionally  without
          regard to Capital Accounts,  and the allocation  provisions of Article
          IV hereof shall also be applied provisionally.  If as a result of such
          provisional  calculations and  allocations,  any Partner would thereby
          have a Capital Account deficit which exceeds its obligation to restore
          such deficit under subsection 10.2(b) above, the actual  distributions
          pursuant  to this  subsection  (c) shall be equal to such  provisional
          distribution  less the amount of such  excess  and actual  allocations
          shall be made in  accordance  with Article IV taking into account such
          actual distributions.

          Any  remaining  net assets  shall be  allocated  among the Partners in
     accordance with their positive Capital Accounts.

If such  distributions are insufficient to return to any Partner the full amount
of its  capital  contributions,  it shall  have no  recourse  against  any other
Partner.  Each Partner  shall  receive its share of the net assets in cash or in
kind,  and the  proportion  of such share that is  received in cash shall be the
same for each Partner. In the event that any part of such net assets consists of
notes or accounts receivable or other non-cash assets, the Management  Committee
or the liquidator shall take whatever steps it deems appropriate to convert such
assets into cash or into any other form which would  facilitate the distribution
thereof.  If any assets of the  Partnership  are to be distributed in kind, such
assets  shall be  distributed  on the  basis  of their  fair  market  value,  as
determined by the Management Committee or the liquidator,  if any, acting in its
sole discretion.


                                   ARTICLE XI
                               DISPUTE RESOLUTION

     11.1 Arbitration.

          (a) In the  event a  dispute  arises  between  or among  any  Partners
     relating  to the terms of this  Agreement  and any  Partner  gives  written
     notice  of such  dispute  to the  Management  Committee,  then  each of the
     Partners  involved  in such  dispute  shall refer the dispute to its senior
     management.  The senior management of each Partner involved in such dispute
     shall meet and confer regarding the resolution of the dispute. In the event
     a resolution  of such dispute is not reached  within 30 days of the written
     notice,  then any of the  Partners  involved in such dispute may submit the
     dispute to arbitration in accordance with Section 11.1(b).



                                      -34-
<PAGE>

          (b) Arbitration of disputes  pursuant to this Section 14.1(b) shall be
     held in Charlotte, North Carolina under the commercial arbitration rules of
     the  American  Arbitration  Association,   and  shall  be  heard  by  three
     arbitrators  selected in accordance with such rules.  Each arbitrator shall
     have at least five years experience in the United States in a profession or
     professions related to the subject matter involved in the dispute and shall
     not be a past or present  officer,  director  or  employee  of, or have any
     interest in or material  relationship with, any Partner or any Affiliate of
     any  Partner.  Any  arbitral  award  shall be final and  binding and may be
     entered by any Partner in any state or Federal  court  having  jurisdiction
     thereof.  Costs of arbitration  (including  reasonable  attorney's fees and
     costs) shall be paid either equally by the parties to the arbitration or in
     accordance with the decision of the arbitrators.

     11.2 Buy/Sell Option.

          (a) In the event that the  Management  Committee  is unable to reach a
     unanimous  decision  with  respect to any matter set forth in Section  6.2,
     either of the  General  Partners  (such  Partner  herein  referred  to as a
     "Buy-Out  Offeror")  shall have the right to make a written offer to buy (a
     "Buy-Out  Offer") all (but not less than all) of the Partnership  Interests
     of the other General Partner and its Affiliates. The Buy-Out Offer shall be
     at a price  determined in  accordance  with the  Appraisal  Procedure  (the
     "Aggregate  Purchase  Price") which shall be payment for all of the assets,
     liabilities and business of the  Partnership,  and the amount to be paid to
     any selling  Partner  under this  Section 11.2 shall be equal to the amount
     such  selling  Partner  would  receive if all the assets,  liabilities  and
     business of the  Partnership  were sold at the Aggregate  Purchase Price on
     the  date  the  Buy-Out  Offer  was  made  and the  Partnership  were  then
     immediately dissolved in accordance with Section 10.2. The General Partners
     hereby agree to use their best efforts to cause the Appraisal  Procedure to
     be  completed  within  ninety  (90) days after it has been  initiated.  The
     General  Partner  receiving a Buy-Out  Offer (a "Buy-Out  Offeree")  shall,
     within 30 days of the  determination  of the  Aggregate  Purchase  Price in
     accordance  with the  Appraisal  Procedure,  either (a) accept the  Buy-Out
     Offer on behalf of itself and its Affiliates who own Partnership  Interests
     or (b) agree to  purchase  all (but not less  than all) of the  Partnership
     Interests  of the Buy-Out  Offeror and its  Affiliates  upon the  foregoing
     terms and using the same  Aggregate  Purchase  Price as was  determined  in
     accordance  with the  Appraisal  Procedure to determine the amount owing to
     each selling Partner.  The failure of any Partner receiving a Buy-Out Offer
     to respond to such Buy-Out Offer within such 30-day deadline of its receipt
     thereof,  either  agreeing to accept such Buy-Out Offer on behalf of itself
     and its  Affiliates  or by agreeing to purchase all (but not less than all)
     of the  Partnership  Interest of the Buy-Out  Offeror and its Affiliates on
     the foregoing terms,  shall  constitute  (without any further action by the
     Buy-Out  Offeror,  the receiving  General  Partner or any other Partner) an
     irrevocable  acceptance  of such  Buy-Out  Offer by the  receiving  General
     Partner  binding on and  enforceable  against such General  Partner and its
     Affiliates.

          (b)  Any  purchase  of  Partnership  Interests  required  pursuant  to
     subsection 11.2(a) shall be made through the redemption of such Partnership
     Interests by the Partnership; provided, however, that if such redemption is
     prohibited  by the Project  Loan


                                      -35-
<PAGE>

     Documents,  such purchase shall be made directly by the purchasing  General
     Partner. The closing date for any such purchase shall be on the date set by
     the purchasing  General Partner which may be at any time within 180 days of
     the acceptance of a Buy-Out Offer or agreement to purchase, as the case may
     be. In the event the purchasing General Partner does not close the purchase
     within such 180-day period,  then the purchasing General Partner's right to
     purchase Partnership  Interests under Section 11.2(a) shall at the close of
     business on such 180th day terminate  and the other  General  Partner shall
     thereafter  have the right to purchase  the  Partnership  Interests  of the
     purchasing  General  Partner and its  Affiliates  at a price  determined by
     using the same  Aggregate  Purchase  Price and such other  General  Partner
     shall have 180 days immediately following the expiration of the initial 180
     day  period in which to close such  purchase.  The price to be paid to each
     selling  Partner  shall  be  paid  by the  purchasing  General  Partner  in
     immediately available funds at the closing.


                                   ARTICLE XII
                                  MISCELLANEOUS

     12.1 Distributions and Notices.  Distributions hereunder shall be sent, and
notices  required or permitted  hereunder shall be in writing and shall be sent,
to the address set forth for each Partner in signature pages hereof,  or at such
other address as may be supplied by written notice given in conformity  with the
terms of this Section 12.1.  Notices to the Management  Committee  shall be sent
care of all  Partners who have a right to  designate  members of the  Management
Committee.  Any notice  required or permitted  under this Agreement  shall be in
writing and shall be deemed to have been duly given  and/or  delivered  (a) when
personally  delivered,  (b) when sent by telefax and receipt is acknowledged via
telephone or otherwise  as  confirmation  of such receipt but only if the sender
obtains a printed  confirmation  of the receipt by the  recipient  of the entire
document,  (c) the  second  day  following  the day on  which  the same has been
delivered  prepaid to a reputable  overnight  courier service providing proof of
receipt  but only if sent for next  business  day  delivery or (d) five (5) days
after the deposit in the United  States mails,  registered or certified,  return
receipt  requested and postage  prepaid,  in each case addressed to the party to
whom such notice is to be given at the address set forth on the signature  pages
hereof), or at the most recent address(es)  specified by written notice given to
the other party in the same manner provided in this section; provided,  however,
that notice of an address change shall not be effective until actually received.
Distributions shall be deemed given only upon the receipt thereof by a Partner.

     12.2 Disclosure  Obligations.  The Partnership  hereby covenants and agrees
for the  benefit  of  Cogentrix  GP and VF  Delaware  that it shall  (a)  notify
Cogentrix GP and VF Delaware of any material fact necessary in order to make any
of the representations, warranties or other statements made by it in the Project
Documents,  or any  other  written  statement  provided  to  Cogentrix  GP or VF
Delaware  not  misleading  and (b)  disclose in writing to  Cogentrix  GP and VF
Delaware any fact which materially  adversely affects, or which could reasonably
be  expected  in the future to  materially  adversely  affect  Cogentrix  GP, VF
Delaware or the  Project,  in each case under  clause (a) or (b) above  promptly
upon receiving knowledge of any such fact.



                                      -36-
<PAGE>

     12.3  Successors and Assigns.  Subject to the  restrictions on transfer set
forth herein,  this Agreement,  and, each and every provision  hereof,  shall be
binding upon and shall inure to the benefit of the  Partners,  their  respective
successors,   successors-in-title,   heirs  and  assigns,  and  each  and  every
successor-in-interest  to any Partner,  whether  such  successor  acquires  such
interest by way of gift,  purchase,  foreclosure  or by any other method,  shall
hold such interest subject to all of the terms and provisions of this Agreement.

     12.4 Amendments. This Agreement may not be released, discharged, amended or
modified  in any manner  except by an  instrument  in  writing  signed by a duly
authorized officer of each party hereto.

     12.5  Partition.  The  Partners  hereby  agree  that  no  Partner,  nor any
successor-in-interest  to any Partner, shall have the right while this Agreement
remains in effect to have the  property of the  Partnership  partitioned,  or to
file a complaint or  institute  any  proceeding  at law or in equity to have the
property of the Partnership partitioned,  and each Partner, on behalf of itself,
its  successors,  representatives,  heirs and  assigns,  hereby  waives any such
right.  It is the  intention  of the  Partners  that  during  the  term  of this
Agreement, the rights of the Partners and their successors-in-interest, as among
themselves, shall be governed by the terms of this Agreement, and that the right
of any Partner or  successor-in-interest  to assign, transfer, sell or otherwise
dispose of its interest in the  Partnership  shall be subject to the limitations
and restrictions of this Agreement.

     12.6 No Waiver. No waiver of any right under this Agreement shall be deemed
effective  unless  contained in a writing  signed by the party charged with such
waiver.  The  failure of any  Partner to insist  upon  strict  performance  of a
covenant hereunder or of any obligation hereunder, irrespective of the length of
time for which such failure  continues,  shall not be a waiver of such Partner's
right  subsequently to demand strict  compliance.  No consent or waiver to or of
any branch or default in the  performance  of any  obligation  hereunder,  shall
constitute  a consent  or waiver to or of any  other  breach or  default  in the
performance of the same or any other obligation hereunder.

     12.7 Entire  Agreement.  This Agreement  constitutes  the full and complete
agreement of the parties  hereto with respect to the subject  matter  hereof and
supersedes  any  and  all  prior   agreements,   understandings,   promises  and
representations  made by either party to the other concerning the subject matter
hereof and the terms applicable hereto.

     12.8  Captions.  Titles or captions of articles,  sections and  subsections
contained in this Agreement are inserted only as a matter of convenience and for
reference,  and in no way are intended to define,  limit, extend or describe the
scope of this Agreement or the intent of any provision hereof.

     12.9  Counterparts.  This  Agreement  may  be  executed  in any  number  of
counterparts,  all of which  together  shall  for all  purposes  constitute  one
Agreement,  binding upon the Partners  notwithstanding that all Partners may not
have signed the same counterpart.



                                      -37-
<PAGE>

     12.10  Applicable  Law. This Agreement shall be deemed to have been entered
into and shall be  construed  and  enforced in  accordance  with the laws of the
State of  Delaware as applied to  contracts  made and to be  performed  entirely
within Delaware.

     12.11 Severability.  If any provision of this Agreement is or becomes or is
deemed invalid, illegal or unenforceable in any jurisdiction, (a) such provision
shall be construed or deemed  amended to conform to applicable  laws so as to be
valid  and  enforceable,  or, if it cannot  be so  construed  or deemed  amended
without  materially  altering the intention of the parties  hereto,  it shall be
stricken,  (b) the validity,  legality and enforceability of such provision will
not in any way be affected or impaired thereby in any other jurisdiction and (c)
the remainder of this Agreement shall remain in full force and effect.



                                      -38-
<PAGE>


     IN WITNESS  WHEREOF,  the Partners have  executed this  Agreement as of the
date first above mentioned.

                                         COGENTRIX OF MARFA, INC.,
                                         as General Partner

                                         By  ___________________________________
                                         Printed Name: Thomas F. Schwartz
                                         Title: Vice President - Finance
                                             and Treasurer

                                         Address for Notices:

                                         9405 Arrowpoint Boulevard
                                         Charlotte, North Carolina 28273
                                         Attention: General Counsel

                                         Address for Distributions:

                                         9405 Arrowpoint Boulevard
                                         Charlotte, North Carolina 28273
                                         Attention:  Treasurer


                                         VILLAGE FARMS OF DELAWARE, L.L.C.,
                                         as General Partner

                                         By: Agro Power Development, Inc.,
                                             Managing Member

                                                  By ___________________________
                                                  Printed Name:  J. Kevin Cobb
                                                  Title:  Vice President

                                         Address for Notices:

                                         10 Alvin Court
                                         East Brunswick, New Jersey   08816
                                         Attention:  Chief Financial Officer

                                         Address for Distributions:

                                         10 Alvin Court
                                         East Brunswick, New Jersey   08816
                                         Attention:  Chief Financial Officer


                                      -39-
<PAGE>

                                         COGENTRIX GREENHOUSE INVESTMENTS,
                                         INC., as Limited Partner

                                         By ____________________________________
                                         Printed Name: Thomas F. Schwartz
                                         Title: Vice President - Finance
                                             and Treasurer

                                         Address for Notices:

                                         9405 Arrowpoint Boulevard
                                         Charlotte, North Carolina 28273
                                         Attention: General Counsel

                                         Address for Distributions:

                                         9405 Arrowpoint Boulevard
                                         Charlotte, North Carolina 28273
                                         Attention:  Treasurer



                                         VILLAGE FARMS, L.L.C.

                                         By: Agro Power Development, Inc.,
                                             Managing Member

                                                 By ____________________________
                                                 Printed Name:  J. Kevin Cobb
                                                 Title:  Vice President

                                         Address for Notices:

                                         10 Alvin Court
                                         East Brunswick, New Jersey   08816
                                         Attention:  Chief Financial Officer

                                         Address for Distributions:

                                         10 Alvin Court
                                         East Brunswick, New Jersey   08816
                                         Attention:  Chief Financial Officer


                                      -40-
<PAGE>



                                 Schedule 1.1(a)

                     Calculation of Internal Rate of Return

Internal Rate of Return Calculation

The  calculation of the Internal Rate of Return in connection  with  determining
the First Priority Return and Second Priority Return will be based upon the cash
inflows and cash  outflows for  Cogentrix GP and Cogentrix LP. The Internal Rate
of Return shall be computed utilizing  Microsoft Excel software version 5.0. The
Internal Rate of Return shall be computed utilizing the @XIRR function in Excel.
For purposes of  calculating  the Internal Rate of Return,  the cash inflows and
cash  outflows to Cogentrix  GP and  Cogentrix  LP shall  consist  solely of the
following:

     Partner Contributions

     All  contributions  made by Cogentrix GP and Cogentrix LP will be reflected
     as a cash  inflow  as of the date such  contribution  was  received  by the
     Partnership.  Cogentrix GP and  Cogentrix LP will be credited for a partner
     contribution at any time such Partner funds cash into the  Partnership.  In
     addition,  to the extent  Cogentrix  Energy,  Inc. or any of its Affiliates
     funds cash directly into the  Partnership  or pays amounts to other persons
     to fulfill  obligations under the Agreement or any of the Project Documents
     or Project Loan Documents or incurs costs or fees  associated with securing
     an obligation to make a contribution to the Partnership,  then such funding
     into the  Partnership or such other payments and/or such costs or fees will
     be deemed a capital contribution by Cogentrix GP and Cogentrix LP as of the
     day on which  such  funding  or  payment  is made or such costs or fees are
     incurred.

     Distributions to Partners

     All  cash  distributions  will  be  reflected  as a cash  outflow  on a net
     After-Tax basis (based on allocations of the  Partnership's  taxable income
     (loss)  in  accordance   with  Section  4.1)  as  of  the  date  such  cash
     distribution was received by the Partner.

The Internal Rate of Return  calculation  shall be performed by Agro Power as of
the end of each calendar  quarter and is subject to the approval of Cogentrix GP
and Cogentrix LP.

All  capitalized  terms used in this Schedule  1.1(a) and not otherwise  defined
herein shall have the meaning set forth in this Agreement.


<PAGE>



                                 Schedule 1.1(c)

                                Project Documents


1.   The West Texas Utility Company  Agreement for Electric  Service dated as of
     March 13,  1997 and as  supplemented  on March 13,  1997 with the  Economic
     Development  Rider  by and  between  Agro  Power,  which is  assigning  its
     interest therein to the Partnership, and West Texas Utilities.

2.   The  Standby/Supplemental  Water  Contract  signed  March  13,  1997  to be
     effective  September 1, 1997 by and between Agro Power,  which is assigning
     its interest  therein to the Partnership,  and the City of Marfa,  Texas, a
     municipal  corporation under the laws of the State of Texas within Presidio
     County, Texas.

3.   The Lease Agreement  dated March 14, 1997 by and between Agro Power,  which
     is assigning  its interest  therein to the  Partnership,  and the County of
     Presidio,  Texas acting by and through its duly authorized  governing body,
     the Presidio County Commissioners Court.

4.   The Gas Sales  Contract  dated June 16, 1997 between  Agro Power,  which is
     assigning its interest  therein to the  Partnership,  and  Southwest  Texas
     Municipal Gas Corporation,  a Texas non-profit  corporation  operating as a
     municipal utility.



<PAGE>



                                  Schedule 6.3

                       Initial Officers of the Partnership



Name                                                  Title
----                                                  -----

Michael A. DeGiglio                              President
Thomas F. Schwartz                               Vice President
Albert Van Zeyst                                 Vice President
J. Kevin Cobb                                    Vice President
Michael Minerva                                  Vice President
Lawrence J. Howard                               Treasurer
Dennis W. Alexander                              Secretary
Lori T. Hladik                                   Assistant Secretary
Eilene M. Beck                                   Assistant Secretary