Document:

Third Amended And Restated Agreement

                            Of Limited Partnership Of

                    Hickory Lane Partners Limited Partnership

<PAGE>

                                TABLE OF CONTENTS

                                                                 Page

I.       DEFINITIONS ............................................. 2

         1.1      "Accountant" ................................... 2
         1.2      "Act" .......................................... 2
         1.3      "Actual Tax Credit"............................. 2
         1.4      "Adjusted Capital Account Deficit" ............. 2
         1.5      "Affiliate" .................................... 2
         1.6      "Agreement" or "Partnership Agreement".......... 2
         1.7      "Apartment Housing"............................. 3
         1.8      "Assignee" ..................................... 3
         1.9      "Bankruptcy" or "Bankrupt"...................... 3
         1.10     "Break-even Operations"......................... 3
         1.11     "Budget"........................................ 3
         1.12     "Capital Account" .............................. 3
         1.13     "Capital Contribution" ......................... 4
         1.14     "Cash Expenses"................................. 4
         1.15     "Cash Receipts"................................. 4
         1.16     "Code" ......................................... 4
         1.17     "Completion of Construction".................... 5
         1.18     "Compliance Period"............................. 5
         1.19     "Consent of the Special Limited Partner"........ 5
         1.20     "Construction Budget"........................... 5
         1.21     "Construction Contract"......................... 5
         1.22     "Construction Lender"........................... 5
         1.23     "Construction Loan" ............................ 5
         1.24     "Contractor" ................................... 6
         1.25     "Debt Service Coverage"......................... 6
         1.26     "Deferred Management Fee"....................... 6
         1.27     "Developer"..................................... 6
         1.28     "Development Fee" .............................. 6
         1.29     "Distributions" ................................ 6
         1.30     "Fair Market Value" ............................ 6
         1.31     "First Year Certificate" ....................... 6
         1.32     "Force Majeure"................................. 7
         1.33     "General Partner" .............................. 7
         1.34     "Gross Asset Value" ............................ 7
         1.35     "Hazardous Substance"........................... 8
         1.36     "Improvements".................................. 8
         1.37     "In-Balance".................................... 8
         1.38     "Incentive Management Fee"...................... 9
         1.39     "Income and Losses"............................. 8
         1.40     "Inspecting Architect"..........................10
         1.41     "Insurance" ....................................10
         1.42     "Insurance Company" ............................11

                                       i
<PAGE>

         1.43     "Interest" .....................................11
         1.44     "Involuntary Withdrawal"........................11
         1.45     "Land Acquisition Fee"..........................11
         1.46     "LIHTC".........................................11
         1.47     "Limited Partner"...............................11
         1.48     "Management Agent"..............................11
         1.49     "Management Agreement"..........................12
         1.50     "Minimum Set-Aside Test"........................12
         1.51     "Mortgage" or "Mortgage Loan"...................12
         1.52     "Net Operating Income"..........................12
         1.53     "Nonrecourse Deductions"........................13
         1.54     "Nonrecourse Liability".........................13
         1.55     "Operating Deficit" ............................13
         1.56     "Operating Deficit Guarantee Period"............13
         1.57     "Operating Loans"...............................13
         1.58     "Original Limited Partner" .....................13
         1.59     "Partner(s)" ...................................13
         1.60     "Partner Nonrecourse Debt" .....................13
         1.61     "Partner Nonrecourse Debt Minimum Gain" ........13
         1.62     "Partner Nonrecourse Deductions" ...............13
         1.63     "Partnership" ..................................13
         1.64     "Partnership Minimum Gain" .....................13
         1.65     "Permanent Mortgage Commencement" ..............13
         1.66     "Person" .......................................14
         1.67     "Plans and Specifications"......................14
         1.68     "Project Documents" ............................14
         1.69     "Projected Annual Tax Credits" .................14
         1.70     "Projected Tax Credits" ........................14
         1.71     "Qualified Tenants" ............................14
         1.72     "Rent Restriction Test" ........................14
         1.73     "Reporting Fee".................................15
         1.74     "Revised Projected Tax Credits".................15
         1.75     "Sale or Refinancing"...........................15
         1.76     "Sale or Refinancing Proceeds" .................15
         1.77     "Special Limited Partner".......................15
         1.78     "State" ........................................15
         1.79     "State Tax Credit Agency" ......................15
         1.80     "Substitute Limited Partner" ...................15
         1.81     "Syndication Fee"...............................15
         1.82     "Tax Credit" ...................................15
         1.83     "Tax Credit Compliance Fee" ....................16
         1.84     "Tax Credit Conditions".........................16
         1.85     "Tax Credit Period".............................16
         1.86     "Title Policy"..................................16
         1.87     "TRA 1986" .....................................16
         1.88     "Treasury Regulations" .........................16
         1.89     "Withdrawing" or "Withdrawal"...................16

II.      NAME ....................................................17

                                       ii
<PAGE>

III.     PRINCIPAL EXECUTIVE OFFICE/AGENT FOR SERVICE ............17

         3.1      Principal Executive Office .....................17
         3.2      Agent for Service of Process ...................17

IV.      PURPOSE .................................................17

         4.1      Purpose of the Partnership......................17
         4.2      Authority of the Partnership....................17

V.       TERM ....................................................18

VI.      GENERAL PARTNER'S CONTRIBUTIONS AND LOANS................18

         6.1      Capital Contribution of General Partner.........18
         6.2      Construction Obligations........................18
         6.3      Operating Obligations...........................19
         6.4      Other General Partner Loans.....................19

VII.     CAPITAL CONTRIBUTIONS OF LIMITED PARTNER
         AND SPECIAL LIMITED PARTNER..............................20

         7.1      Original Limited Partner........................20
         7.2      Capital Contribution of Limited Partner.........20
         7.3      Repurchase of Limited Partner's Interest........22
         7.4      Adjustment of Limited Partner's
                  Capital Contribution............................23
         7.5      Capital Contribution of Special Limited Partner.25
         7.6      Return of Capital Contribution..................26
         7.7      Liability of Limited Partner and Special
                  Limited Partner.................................26

VIII.    WORKING CAPITAL AND RESERVES ............................26

         8.1      Operating and Maintenance Account...............26
         8.2      Tax and Insurance Account.......................26
         8.3      Other Reserves..................................27

IX.      MANAGEMENT AND CONTROL ..................................27

         9.1      Power and Authority of General Partner .........27
         9.2      Payments to the General Partners and Others ....27
         9.3      Specific Powers of the General Partner .........29
         9.4      Authority Requirements..........................30
         9.5      Limitations on General Partner's
                  Power and Authority ............................31
         9.6      Restrictions on Authority of General Partner....32
         9.7      Duties of General Partner ......................33
         9.8      Obligations to Repair and Rebuild Apartment
                  Housing.........................................35
         9.9      Partnership Expenses ...........................35
         9.10     General Partner Expenses .......................36

                                      iii
<PAGE>

         9.11     Other Business of Partners .....................36
         9.12     Covenants, Representations and Warranties.......36

X.       ALLOCATIONS OF INCOME, LOSSES AND CREDITS ...............40

         10.1     General ........................................40
         10.2     Allocations From Sale or Refinancing............40
         10.3     Special Allocations.............................41
         10.4     Curative Allocations............................44
         10.5     Other Allocation Rules..........................45
         10.6     Tax Allocations:  Code Section 704(c)...........46
         10.7     Allocation Among Limited Partners...............46
         10.8     Allocation Among General Partners ..............46
         10.9     Modification of Allocations ....................47

XI.      DISTRIBUTION ............................................47

         11.1     Distribution of Net Operating Income ...........47
         11.2     Distribution of Sale or Refinancing Proceeds....47

XII.     TRANSFERS OF LIMITED PARTNER'S INTEREST
         IN THE PARTNERSHIP.......................................48

         12.1     Assignment of Limited Partner's Interest .......48
         12.2     Effective Date of Transfer .....................49
         12.3     Invalid Assignment .............................49
         12.4     Assignee's Rights to Allocations
                  and Distributions ..............................49
         12.5     Substitution of Assignee as Limited Partner
                  or Special Limited Partner......................49
         12.6     Death, Bankruptcy, Incompetency, etc.
                  of a Limited Partner ...........................50

XIII.    WITHDRAWAL, REMOVAL AND REPLACEMENT OF GENERAL
         PARTNER .................................................50

         13.1     Withdrawal of General Partner ..................50
         13.2     Removal of General Partner .....................50
         13.3     Effects of a Withdrawal.........................53
         13.4     Successor General Partner.......................54
         13.5     Admission of Additional or Successor
                  General Partner ................................55
         13.6     Transfer of Interest ...........................55
         13.7     No Goodwill Value...............................55

XIV.     BOOKS AND ACCOUNTS, REPORTS, TAX RETURNS,
         FISCAL YEAR AND BANKING .................................56

         14.1     Books and Accounts .............................56
         14.2     Accounting Reports .............................57
         14.3     Other Reports ..................................59

                                       iv
<PAGE>

         14.4     Late Reports ...................................60
         14.5     Annual Site Visits..............................60
         14.6     Tax Returns.....................................60
         14.7     Fiscal Year ....................................60
         14.8     Banking ........................................60
         14.9     Certificates and Elections .....................60

XV.      DISSOLUTION, WINDING UP, TERMINATION AND
         LIQUIDATION OF THE PARTNERSHIP ..........................61

         15.1     Dissolution of Partnership .....................61
         15.2     Return of Capital Contribution upon
                  Dissolution ....................................61
         15.3     Distributions of Assets ........................61
         15.4     Deferral of Liquidation.........................62
         15.5     Liquidation Statement ..........................63
         15.6     Certificates of Dissolution; Certificate of
                  Cancellation of Certificate of Limited
                  Partnership ....................................63

XVI.     AMENDMENTS ..............................................63

XVII.    MISCELLANEOUS ...........................................64

         17.1     Voting Rights ..................................64
         17.2     Meeting of Partnership .........................64
         17.3     Notices ........................................65
         17.4     Successors and Assigns .........................65
         17.5     Recording of Certificate of Limited
                  Partnership. ...................................65
         17.6     Amendment of Certificate of Limited
                  Partnership ....................................65
         17.7     Counterparts ...................................66
         17.8     Captions .......................................66
         17.9     Saving Clause...................................66
         17.10    Certain Provisions..............................66
         17.11    Tax Matters Partners............................67
         17.12    Expiration of Compliance Period.................67
         17.13    Number and Gender ..............................68
         17.14    Entire Agreement ...............................68
         17.15    Governing Law ..................................69
         17.16    Attorney's Fees ................................69
         17.17    Receipt of Correspondence ......................69
         17.18    Security Interest and Right of Set-Off .........69

     EXHIBIT A - Legal Description...................... A-1
     EXHIBIT B - Form of Legal Opinion.................. B-1  -  B-4
     EXHIBIT C - Certification and Agreement............ C-1  -  C-4
     EXHIBIT D - Form of Completion Certificate......... D-1
     EXHIBIT E - Accountant's Certificate............... E-1

                                       v
<PAGE>

     EXHIBIT F - Contractor's Letter.....................F-1
     EXHIBIT H - Report of Operations................... H-1  -  H-10

                                       vi
<PAGE>

                      Third Amended And Restated Agreement
                            Of Limited Partnership Of
                    Hickory Lane Partners Limited Partnership

         This Third Amended And Restated  Agreement Of  Limited  Partnership  is
being  entered into  effective as of the  date  written  below  by  and  between
Lewis F.  Weinberg,  Weinberg  Investments,  Inc. and Sioux Falls  Environmental
Access,  Inc. as the general  partner (the "General  Partner"),  WNC Housing Tax
Credit Fund VI, L.P., Series 7, a California limited  partnership as the limited
partner (the  "Limited  Partner"),  WNC Housing,  L.P.,  as the special  limited
partner  (the  "Special  Limited  Partner")  and Donald W.  Goulart,  Jr. as the
withdrawing limited partner (the "Original Limited Partner").

                                    RECITALS

         WHEREAS,  Hickory Lane Partners  Limited  Partnership,  an Iowa limited
partnership (the  "Partnership")  recorded a certificate of limited  partnership
with the Iowa  Secretary  of State on April 10,  2000.  An Amended and  Restated
partnership  agreement  dated April 10, 2000 was entered into by and between the
General Partner and the Original Limited Partner (the "Partnership Agreement").

         WHEREAS,  the Partners  desire to enter into this  Agreement to provide
for,  among other things,  (i) the  continuation  of the  Partnership,  (ii) the
admission of the Limited  Partner and the Special Limited Partner as partners of
the Partnership,  (iii) the liquidation of the Limited Partner's Interest in the
Partnership,  (iv) the payment of Capital  Contributions  by the Limited Partner
and the  Special  Limited  Partner to the  Partnership,  (v) the  allocation  of
Income,  Losses, Tax Credits and distributions of Net Operating Income and other
cash funds of the Partnership among the Partners,  (vi) the determination of the
respective  rights,  obligations and interests of the Partners to each other and
to the Partnership, and (vii) certain other matters.

         WHEREAS,   the  Partners   desire  hereby  to  amend  and  restate  the
Partnership Agreement.

         NOW, THEREFORE,  in consideration of their mutual agreements herein set
forth, the Partners hereby agree to amend and restate the Partnership  Agreement
in its entirety to provide as follows:

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

     Section  1.1  "Accountant"  shall mean  Richard B. Lefor CPA, or such other
firm of  independent  certified  public  accountants  as may be engaged  for the
Partnership  by the General  Partner  with the  Consent of the  Special  Limited
Partner.  Notwithstanding  any provision of this Agreement to the contrary,  the
Special  Limited Partner shall have the discretion to dismiss the Accountant for
cause if such Accountant fails to provide, or untimely provides, or inaccurately
provides, the information required in Section 14.2 or 14.3 of this Agreement.

     Section  1.2  "Act"  shall  mean the laws of the  State  governing  limited
partnerships, as now in effect and as the same may be amended from time to time.

     Section 1.3 "Actual  Tax  Credit"  shall mean as of any point in time,  the
total amount of the LIHTC actually  allocated by the  Partnership to the Limited
Partner and not subsequently  recaptured or disallowed,  representing  99.98% of
the LIHTC actually  received by the Partnership,  as shown on the applicable tax
returns of the Partnership.

     Section 1.4 "Adjusted  Capital Account  Deficit" shall mean with respect to
any Partner,  the deficit balance,  if any, in such Partner's Capital Account as
of the end of the relevant  fiscal period,  after giving effect to the following
adjustments:

         (a) credit to such  Capital  Account any amounts  which such Partner is
obligated  to restore or is deemed to be  obligated  to restore  pursuant to the
penultimate  sentences  of  Treasury  Regulations  Sections   1.704-2(g)(1)  and
1.704-2(i)(5); and

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

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

     Section 1.5  "Affiliate"  shall mean (a) any Person  directly or indirectly
controlling, controlled by, or under common control with another Person; (b) any
Person owning or controlling 10% or more of the outstanding voting securities of
such other Person; (c) any officer, director,  trustee, or partner of such other
Person;  and (d) if such  Person is an  officer,  director,  trustee  or general
partner, any other Person for which such Person acts in any such capacity.

     Section 1.6 "Agreement" or "Partnership  Agreement" shall mean this Amended
and Restated Agreement of Limited Partnership, as it may be amended from time to

                                       2
<PAGE>

time. Words such as "herein,"  "hereinafter,"  "hereof,"  "hereto," "hereby" and
"hereunder,"  when  used  with  reference  to  this  Agreement,  refers  to this
Agreement as a whole, unless the context otherwise requires.

     Section 1.7 "Apartment  Housing" shall  collectively mean the approximately
1.8 acres of land in Sioux City, Woodbury County,  Iowa, as more fully described
in Exhibit "A" attached hereto and  incorporated  herein by this reference,  the
40-unit apartment building thereon and Improvements.

     Section  1.8  "Assignee"  shall  mean a Person  who has  acquired  all or a
portion of the Limited  Partner's or the Special  Limited  Partner's  beneficial
interest in the Partnership and who has not been substituted in the stead of the
transferor as a Partner.

     Section  1.9  "Bankruptcy"  or  "Bankrupt"  shall  mean  the  making  of an
assignment for the benefit of creditors,  becoming a party to any liquidation or
dissolution   action  or  proceeding,   the   commencement  of  any  bankruptcy,
reorganization,  insolvency or other  proceeding  for the relief of  financially
distressed debtors, or the appointment of a receiver,  liquidator,  custodian or
trustee  and,  if any of the  same  occur  involuntarily,  the  same  not  being
dismissed,  stayed or  discharged  within 90 days;  or the entry of an order for
relief  under  Title 11 of the United  States  Code.  A Partner  shall be deemed
Bankrupt if the  Bankruptcy  of such Partner shall have occurred , be continuing
and has not been disclosed to the special limited partner.

     Section  1.10  "Break-even  Operations"  shall  mean  at  such  time as the
Partnership  has Cash  Receipts  equal to Cash  Expenses,  as  determined by the
Accountant  and approved by the Special  Limited  Partner.  For purposes of this
definition,  any one-time  up-front fee paid to the Partnership  from any source
shall not be included in Cash Receipts to calculate Break-even Operations.

     Section  1.11  "Budget"  shall  mean the  annual  operating  Budget  of the
Partnership as more fully described in Section 14.3 (k) of this Agreement.

     Section 1.12 "Capital  Account"  shall mean,  with respect to each Partner,
the account  maintained  for such Partner  comprised of such  Partner's  Capital
Contribution  as increased by allocations to such Partner of Partnership  Income
(or  items  thereof)  and any items in the  nature  of income or gain  which are
specially  allocated  pursuant to Section 10.3 or 10.4 hereof,  and decreased by
the amount of any  Distributions  made to such Partner,  and allocations to such
Partner of Partnership  Losses (or items thereof) and any items in the nature of
expenses or losses  which are  specially  allocated  pursuant to Section 10.3 or

                                       3
<PAGE>

     10.4 hereof. In the event of any transfer of an interest in the Partnership
in accordance with the terms of this Agreement,  the transferee shall succeed to
the  Capital  Account  of  the  transferor  to  the  extent  it  relates  to the
transferred interest.  The foregoing definition and the other provisions of this
Agreement relating to the maintenance of Capital Accounts are intended to comply
with  Treasury  Regulation  Section  1.704-1(b),  as  amended  or any  successor
thereto,  and shall be interpreted and applied in a manner  consistent with such
Treasury Regulation.

     Section 1.13 "Capital  Contribution"  shall mean the total amount of money,
or the Gross Asset Value of property contributed to the Partnership,  if any, by
all the  Partners or any class of Partners or any one Partner as the case may be
(or by a  predecessor-in-interest  of such Partner or Partners),  reduced by any
such capital which shall have been returned  pursuant to Section 7.3, 7.4 or 7.6
of  this  Agreement.  A loan  to  the  Partnership  by a  Partner  shall  not be
considered a Capital Contribution.

     Section 1.14 "Cash Expenses"  shall mean all cash operating  obligations of
the  Partnership  (other than those covered by Insurance) in accordance with the
applicable  Budget,  including  without  limitation,  the payment of the monthly
Mortgage  payments,  the Management Agent fees (which shall be deemed to include
that portion of such fees which is currently deferred and not paid), the funding
of reserves in accordance with Article VIII of this  Agreement,  advertising and
promotion,  utilities,  maintenance,  repairs,  Partner  communications,  legal,
telephone,  any other  expenses which may reasonably be expected to be paid in a
subsequent  period but which on an accrual  basis is  allocable to the period in
question,  such as  Insurance,  real estate taxes and audit,  tax or  accounting
expenses (excluding deductions for cost recovery of buildings;  improvements and
personal  property  and  amortization  of any  financing  fees) and any seasonal
expenses (such as snow removal, the use of air conditioners in the middle of the
summer, or heaters in the middle of the winter) which may reasonably be expected
to be paid in a subsequent  period shall be allocated equally per month over the
calendar year. Cash Expenses payable to Partners or Affiliates of Partners shall
be paid  after  Cash  Expenses  payable  to third  parties.  Loan  interest  and
construction or renovation costs of any nature  whatsoever are not Cash Expenses
and shall not be paid from Cash Receipts, except by prior written consent of the
special  limited  partner.  The  provisions of Section 6.2 govern the payment of
construction or renovation costs and interest.

     Section  1.15 "Cash  Receipts"  shall mean actual  cash  received on a cash
basis by the Partnership from operating  revenues of the Partnership,  including
without  limitation  rental income (but not any subsidy thereof from the General
Partner or an Affiliate thereof) and laundry income, but excluding  prepayments,
security deposits,  Capital  Contributions,  borrowings,  lump-sum payment,  any
extraordinary  receipt of funds,  and any  income  earned on  investment  of its
funds.

     Section  1.16  "Code"  shall mean the  Internal  Revenue  Code of 1986,  as
amended from time to time, or any successor statute.

                                       4
<PAGE>

     Section  1.17  "Construction  and  Renovation"  shall mean any  renovation,
remodeling,  rehabilitation  or  expansion  of the  existing  40-unit  Apartment
Housing, including but not necessarily limited to the interior of the units, the
common areas of the building, the exterior of the building or the building site.

     Section 1.18  "Completion of Construction  and  Renovation"  shall mean the
date the  Partnership  receives the required  certificate  of occupancy  (or the
local  equivalent)  for  all  40  apartment  units,  or by the  issuance  of the
inspecting  architect's  certification,  in a form substantially  similar to the
form attached hereto as Exhibit "D" and  incorporated  herein by this reference,
with respect to completion of  construction  and renovation of all the apartment
units in the Apartment  Housing and related  areas.  Completion of  Construction
further means that the  construction  or  renovation  shall be completed in good
quality,  and free and  clear  of all  mechanic,  material  and  similar  liens.
Notwithstanding, Completion of Construction or Renovation shall not be deemed to
have occurred if on such date any liens or other encumbrances as to title to the
Apartment Housing exist, other than the Construction Loan.

     Section 1.19 "Compliance Period" shall mean the period set forth in Section
42 (i)(1) of the Code, as amended, or any successor statute.

     Section 1.20 "Consent of the Special Limited  Partner" shall mean the prior
written consent of the Special Limited Partner.

     Section 1.21  "Construction  and  Renovation  Budget" shall mean the agreed
upon cost of  construction  or renovation of the  Improvements,  including  soft
costs (which includes,  but is not limited to, financing charges,  market study,
Development Fee, architect fees, etc.), based upon the Plans and Specifications.
The final Construction Budget is referenced in the Development, Construction and
Operating  Budget  Agreement  entered  into by and between the Partners the even
date  hereof,  and  incorporated  herein  by this  reference.  The  Development,
Renovation,   Construction  and  Operating  Budget  Agreement  shall:  list  all
subcontractors  and material  suppliers  who will account for $25,000 or more of
the cost of  construction  or renovation of the  Improvements;  and show a trade
payment breakdown  specifying the cost of each classification of construction or
renovation requirements pursuant to the Plans and Specifications.

     Section  1.22  "Construction  and  Renovation   Contract"  shall  mean  the
construction  and  renovation  contract  dated  June 10,  2000 in the  amount of
$343,000,  (including the purchase  orders and contracts  issued by Oakleaf Real
Estate  Management  for the repair and renovation of the  Improvements)  entered
into  between  the  Partnership  and  the  Contractor   pursuant  to  which  the
Improvements are being constructed or renovated in accordance with the Plans and

                                       5
<PAGE>

Specifications.  The Construction and Renovation Contract shall be a fixed price
agreement  (includes  materials  and  labor)  at  a  cost  consistent  with  the
Construction and Renovation Budget.

     Section 1.23 "Contractor"  shall mean Developers & Associates,  Inc., which
is the general  construction  contractor  for the Apartment  Housing and Oakleaf
Real Estate Management.  At or before Completion of Construction and Renovation,
the Contractor shall provide the Partnership with a closeout binder, which shall
include,  but is not limited to, as-built drawings,  all operating manuals,  and
all manufacturing warranty agreements. In addition, the Contractor shall provide
the Partnership a one-year warranty on all parts, materials and work-quality.

     Section 1.24 "Debt Service  Coverage" shall mean for the applicable  period
the ratio between the Net Operating Income (excluding Mortgage payments) and the
debt  service  required  to be  paid  on the  Mortgage(s)  after  Completion  of
Construction.  As example,  a 1.15 Debt  Service  Coverage  means that for every
$1.00 of debt service  required to be paid there must be $1.15 of Net  Operating
Income  available.  A worksheet for the calculation of Debt Service  Coverage is
found  in  the  Report  of  Operations   attached  hereto  as  Exhibit  "H"  and
incorporated herein by this reference.

     Section 1.25 "Deferred  Management Fee" shall have the meaning set forth in
Section 9.2(c) hereof.

     Section  1.26  "Developer"  shall  mean  Lewis  F.  Weinberg  and  Weinberg
Investments, Inc.

     Section 1.27  "Development Fee" shall mean the fee payable to the Developer
for services  incident to the  development,  renovation and  construction of the
Apartment  Housing in accordance with the Development Fee Agreement  between the
Partnership  and the  Developer  dated the even date  herewith and  incorporated
herein by this reference. Development activities do not include services for the
acquisition of land or syndication activities.

     Section 1.28  "Distributions"  shall mean the total amount of money, or the
Gross Asset Value of property  (net of  liabilities  securing  such  distributed
property  that such  Partner is  considered  to assume or take  subject to under
Section  752 of the  Code),  distributed  to  Partners  with  respect  to  their
Interests in the Partnership,  but shall not include any payments to the General
Partner or its  Affiliates  for fees or other  compensation  as provided in this
Agreement or any guaranteed  payment within the meaning of Section 707(c) of the
Code, as amended,  or any successor thereto.  Pursuant to the HAP Contract,  the
project  is  subject  to an annual  limited  distribution  restriction.  HUD has
determined the maximum annual distribution to be $15,239.

     Section 1.29 "Fair Market Value" shall mean,  with respect to any property,
real or  personal,  the price a ready,  willing  and able  buyer  would pay to a

                                       6
<PAGE>

ready,  willing and able  seller of the  property,  provided  that such value is
reasonably  agreed to between the parties in arm's-length  negotiations  and the
parties have sufficiently adverse interests.

     Section  1.30 "First Year  Certificate"  shall mean the  certificate  to be
filed by the General  Partner with the  Secretary of the Treasury as required by
Code Section 42(1)(1), as amended, or any successor thereto.

     Section 1.31 "Force Majeure" shall mean any act of God, strike, lockout, or
other industrial  disturbance,  act of the public enemy, war,  blockage,  public
riot,  fire,  flood,  explosion,  governmental  action,  governmental  delay  or
restraint.

     Section 1.32 "General  Partner(s)"  shall mean Lewis F. Weinberg,  Weinberg
Investments,  Inc.  and Sioux Falls  Environmental  Access,  Inc. and such other
Persons as are admitted to the  Partnership as additional or substitute  General
Partners  pursuant to this Agreement.  If there is more than one General Partner
of the Partnership,  the term "General  Partner" shall be deemed to collectively
refer to such General  Partners or individually  may mean any General Partner as
the context dictates.

     Section 1.33 "Gross Asset Value" shall mean 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 Fair Market Value of such asset, as determined
by the  contributing  Partner and the General  Partner,  provided  that,  if the
contributing  Partner is a General Partner, the determination of the Fair Market
Value of a contributed asset shall be determined by appraisal;

        (b) the Gross Asset Values of all  Partnership  assets shall be adjusted
to equal their  respective  Fair Market  Values,  as  determined  by the General
Partner,  as of the  following  times:  (1)  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;  (2) the distribution by the Partnership
to a  Partner  of more  than a de  minimis  amount of  Partnership  property  as
consideration for an Interest in the Partnership; and (3) the liquidation of the
Partnership    within   the    meaning   of   Treasury    Regulations    Section
1.704-1(b)(2)(ii)(g);  provided,  however,  that  the  adjustments  pursuant  to
clauses  (1) and (2) above  shall be made only with the  Consent of the  Special
Limited Partner and only if the General Partner reasonably  determines that such
adjustments  are  necessary  or  appropriate  to reflect the  relative  economic
interests of the Partners in the Partnership;

        (c) the Gross Asset Value of any  Partnership  asset  distributed to any
Partner  shall be adjusted  to equal the Fair Market  Value of such asset on the
date of distribution  as determined by the distributee and the General  Partner,

                                       7
<PAGE>

provided that, if the distributee is a General Partner, the determination of the
Fair Market Value of the distributed asset shall be determined by appraisal; and

        (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  Treasury  Regulations  Section  1.704-1(b)(2)(iv)(m)  and  Section
10.3(g) hereof;  provided however, that Gross Asset Values shall not be adjusted
pursuant to this Section  1.34(d) to the extent the General  Partner  determines
that  an  adjustment   pursuant  to  Section  1.34(b)  hereof  is  necessary  or
appropriate in connection with a transaction  that would otherwise  result in an
adjustment pursuant to this Section 1.34(d).

        If the Gross  Asset  Value of an asset has been  determined  or adjusted
pursuant to Section 1.34(a),  Section 1.34(b),  or Section 1.34(d) hereof,  such
Gross Asset Value shall  thereafter be adjusted by the  depreciation  taken into
account with respect to such asset for purposes of computing Income and Losses.

     Section 1.34  "Hazardous  Substance"  shall mean and include any substance,
material  or  waste,  including  asbestos,   petroleum  and  petroleum  products
(including crude oil), that is or becomes designated, classified or regulated as
"toxic"  or  "hazardous"  or a  "pollutant"  or  that  is or  becomes  similarly
designated,  classified  or  regulated,  under any federal,  state or local law,
regulation  or  ordinance  including,   without  limitation,   Compensation  and
Liability Act of 1980, as amended,  the Hazardous Materials  Transportation Act,
as amended,  the Resource  Conservation  and Recovery  Act, as amended,  and the
regulations adopted and publications promulgated pursuant thereto.

     Section  1.35 "HAP  Contract"  shall mean the Section 8 Housing  Assistance
Payments Contract pursuant to which housing assistance payments are made for the
benefit of  eligible  families  and  persons,  as  defined in the HAP  Contract,
occupying units in the Apartment Housing.

     Section  1.36 "HUD"  shall mean the U.S.  Department  of Housing  and Urban
Development.

     Section  1.37   "Improvements"   shall  mean  the  one  building  currently
containing  40  apartment  units  for the  elderly,  ancillary  and  appurtenant
facilities  (including those intended for commercial use, if any). It shall also
include all furnishings, equipment and personal property used in connection with
the operation thereof.

     Section 1.38 "In-Balance"  shall mean, on any occasion,  when the amount of
the undisbursed  Loan and the undisbursed  Capital  Contributions of the Limited
Partner and Special Limited Partner required to be paid-in through and including

                                       8
<PAGE>

the  issuance  of a  certificate  of  occupancy  (or the local  equivalent)  are
sufficient in the Special Limited  Partner's  reasonable  judgment to pay all of
the following  sums:  (a) all costs of  construction  and  renovation to achieve
Completion  of  Construction  and  Renovation;   (b)  all  costs  of  marketing,
ownership,  maintenance and leasing of the Apartment  Housing units; and (c) all
interest  and all other sums  accruing or payable  under the  Construction  Loan
documents.  In making a  determination  that the  financing is  In-Balance,  the
Special  Limited  Partner will also  consider  whether the  undisbursed  Capital
Contributions of the Limited Partner and Special Limited  Partner,  the Mortgage
and other sources of permanent financing (but not Cash Receipts) are adequate to
retire the Construction  Loan at the earlier of the time of Mortgage closing and
funding, or maturity of the Construction Loan.

     Section 1.39 "Incentive Management Fee" shall have the meaning set forth in
Section 9.2(e) hereof.

     Section  1.40  "Income and  Loss(es)"  shall mean,  for each fiscal year or
other period,  an amount equal to the  Partnership's  taxable income or loss for
such year or 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) any income of the Partnership that is exempt from federal income tax
and not otherwise  taken into account in computing  Income or Losses pursuant to
this Section 1.38 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
Regulation Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in
computing  Income and Losses  pursuant to this Section 1. 39 shall be subtracted
from such taxable income or loss;

        (c) in the event  the  Gross  Asset  Value of any  Partnership  asset is
adjusted  pursuant  to  Section  1.34(a)  or (b)  hereof,  the  amount  of  such
adjustment  shall be taken into account as gain or loss from the  disposition of
such asset for purposes of computing Income and Losses;

        (d) gain or loss  resulting from any  disposition of Partnership  assets
with respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Gross Asset Value of the property disposed
of,  notwithstanding  that the adjusted tax basis of such property  differs from
its Gross Asset Value;

        (e) in lieu of the depreciation,  amortization,  and other cost recovery
deductions  taken into account in computing such taxable  income or loss,  there

                                       9
<PAGE>

shall be taken into account  depreciation  for such fiscal year or other period,
computed as provided below; and

        (f)  notwithstanding  any other provision of this definition,  any items
which are specially allocated pursuant to Sections 10.3 or 10.4 hereof shall not
otherwise be taken into account in computing Income or Losses.

Depreciation  for each  fiscal  year or other  period  shall  be  calculated  as
follows:  an  amount  equal to the  depreciation,  amortization,  or other  cost
recovery  deduction  allowable  with  respect to an asset for such year or other
period for federal income tax purposes,  except that if the Gross Asset Value of
an asset differs from its adjusted  basis for federal income tax purposes at the
beginning of such year or other  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 year
or other period bears to such beginning adjusted tax basis;  provided,  however,
if the federal  income tax  depreciation,  amortization,  or other cost recovery
deduction for such year is zero, depreciation shall be determined with reference
to such beginning Gross Asset Value using any reasonable  method selected by the
General Partner.

For purposes of this  Agreement,  the term Income  when used alone shall include
all  items  of  income  or  revenue  contemplated  in this  Section and the term
Losses  when  used  alone  shall   include  all  items  of  loss  or  deductions
contemplated in this Section.

     Section  1.41  "Inspecting  Architect"  shall mean Kendall  Strand,  or any
successor  from  Security  National Bank thereto with the Consent of the Special
Limited Partner.  The Inspecting Architect shall make regular inspections of the
construction  site,  but at least prior to each draw  request for payment by the
contractor , to confirm that construction and renovation of the Improvements are
in conformance with the Plans and Specifications.  The Inspecting Architect will
sign-off  on all the  draw  requests  made by the  Contractor  and  provide  the
documents specified in Section 14.3(a) of this Agreement.  The Partnership shall
budget for, and pay the cost of, the Inspecting  Architect.  If there is, at any
time,  an identity  of  interest  between  the  Partnership  and the  Inspecting
Architect,  or between the  Contractor and the  Inspecting  Architect,  then the
General  Partner  will  immediately  relieve  the  Inspecting  Architect  of any
inspecting  duties.  The General Partner shall dismiss the Inspecting  Architect
for cause if the Inspecting  Architect  fails to detect,  or fails to notify the
General  Partner and Special Limited Partner within five business days of a draw
request, that: (a) the construction and renovation budget is not In-Balance; (b)
a change order; (c) any modification to the Plans and Specifications; or (d) any
modification  to a  construction  or  renovation  line  item  from the  approved
construction and renovation budget as specified in the Development,  Renovation,
Construction and Operating Budget Agreement.

                                       10
<PAGE>

     Section 1.42 "Insurance" shall mean:

        (a) during construction and renovation, the Partnership will provide and
maintain,  or cause the  Contractor  to provide  and  maintain,  builder's  risk
insurance in an amount  equal to 100% of the  insurable  value of the  Apartment
Housing at the date of completion;  comprehensive  general  liability  insurance
with limits against bodily injury of not less than $1,000,000 per occurrence and
an  aggregate  of  $2,000,000  and  against  property  damage  of not less  than
$1,000,000; and worker's compensation insurance, with statutory guidelines;

        (b) during operations the Partnership will provide and maintain business
interruption  coverage  covering actual  sustained loss for 12 months;  worker's
compensation;  hazard  coverage  (including  but not  limited to fire,  or other
casualty loss to any structure or building on the Apartment Housing in an amount
equal to the full replacement  value of the damaged  property without  deducting
for  depreciation);   and  comprehensive   general  liability  coverage  against
liability  claims for bodily injury or property  damage in the minimum amount of
$1,000,000 per occurrence and an aggregate of $2,000,000;

        (c) all liability  coverage shall include an umbrella liability coverage
in a minimum amount of $4,000,000 per occurrence and an aggregate of $4,000,000;

        (d) all Insurance  polices shall  name  the  Partnership  as  the  named
insured, the Limited Partner as an additional insured, and WNC & Associates,
Inc. as the certificate holder;

        (e) all Insurance policies shall  include  a  provision  to  notify  the
insured, the Limited Partner and the certificate holder prior to cancellation;

        (f) hazard  coverage  must  include  inflation and building or ordinance
endorsements; and

        (g) the  Contractor  must also provide  evidence of  liability  coverage
equal to $1,000,000  per  occurrence  with an aggregate of $2,000,000  and shall
name the  Partnership  as an additional  insured and WNC & Associates,  Inc., as
certificate holder.

     Section 1.43 "Insurance  Company" shall mean any insurance  company engaged
by the  General  Partner  for the  Partnership  with the  Consent of the Special
Limited  Partner  which  Insurance  Company shall have an A rating or better for
financial safety by A.M. Best or Standard & Poor's.

     Section  1.44  "Interest"  shall mean the entire  ownership  interest  of a
Partner in the Partnership at any particular  time,  including the right of such
Partner to any and all benefits to which a Partner may be entitled hereunder and
the obligation of such Partner to comply with the terms of this Agreement.

                                       11
<PAGE>

     Section  1.45  "Involuntary  Withdrawal"  shall  mean any  Withdrawal  of a
General  Partner  caused by death,  adjudication  of insanity  or  incompetence,
Bankruptcy, or the removal of a General Partner pursuant to Section 13.2 hereof.

     Section  1.46 "Land  Acquisition  Fee"  shall  mean the fee  payable to the
General Partner in an amount equal to $ 2,250 for the General Partner's services
in locating,  negotiating  and closing on the purchase of the real property upon
which the Improvements are, or will be, erected.

     Section  1.47  "LIHTC"  shall  mean  the  low-income   housing  tax  credit
established  by TRA 1986 and which is provided for in Section 42 of the Code, as
amended, or any successor thereto.

     Section 1.48 "Limited  Partner"  shall mean WNC Housing Tax Credit Fund VI,
L.P., Series 7, a California limited partnership,  and such other Persons as are
admitted  to the  Partnership  as  additional  or  Substitute  Limited  Partners
pursuant to this Agreement.

     Section 1.48 "Management Agent" shall mean the property  management company
which oversees the property  management  functions for the Apartment Housing and
which is on-site at the Apartment Housing. The initial Management Agent shall be
Oakleaf Real Estate Management.

     Section 1.50 "Management  Agreement"  shall mean the agreement  between the
Partnership  and the  Management  Agent for property  management  services.  The
management  fee  shall  equal 6% of gross  revenues  and such  other  management
expenses as are commonly allowed by HUD for similar  assisted housing  projects.
Neither the Management  Agreement nor ancillary  agreement  shall provide for an
initial  rent-up fee, a set-up fee,  nor any other  similar  pre-management  fee
payable to the Management Agent. The Management  Agreement shall provide that it
will  be  terminable  at  will  by the  Partnership  at  anytime  following  the
withdrawal  or  removal  of  the  General  Partner  and,  in any  event,  on any
anniversary  of the  date of  execution  of the  Management  Agreement,  without
payment or penalty for failure to renew the same.

     Section 1.51 "Minimum  Set-Aside  Test" shall mean the 40-60 set-aside test
pursuant to Section  42(g),  as amended and any successor  thereto,  of the Code
with respect to the percentage of apartment units in the Apartment Housing to be
occupied  by  tenants  whose  incomes  are  equal to or less  than the  required
percentage of the area median gross income.

     Section 1.52  "Mortgage"  or "Mortgage  Loan" shall mean the  permanent and
interim bridge  nonrecourse  financing wherein the Partnership  promises to pay:
(a) Security  National Bank, or its successor or assignee,  the principal sum of
$1,520,000, plus interest on the principal at 7.75% per annum, adjusted every 60
months at an index of the average five year U.S. Treasury plus 2.75% , amortized
over 30 years with a balloon payment at the end of the first 15 years. Where the

                                       12
<PAGE>

context  admits,  the term  "Mortgage"  or  "Mortgage  Loan"  shall  include any
mortgage,  deed, deed of trust, note, regulatory agreement,  security agreement,
assumption  agreement  or  other  instrument  executed  in  connection  with the
Mortgage  which is  binding  on the  Partnership;  and in case any  Mortgage  is
replaced or supplemented by any subsequent  mortgage or mortgages,  the Mortgage
shall refer to any such  subsequent  mortgage or mortgages.  The Mortgage  funds
shall be used to acquire the project.

     Section  1.53 "Net  Operating  Income"  shall mean the cash  available  for
Distribution  on an annual  basis,  when Cash  Receipts  exceed  Cash  Expenses,
subject to the HAP Contract and the requirements thereunder.

     Section 1.54  "Nonrecourse  Deductions"  shall have the meaning given it in
Treasury Regulations Section 1.704-2(b)(1).

     Section 1.55  "Nonrecourse  Liability"  shall have the meaning  given it in
Treasury Regulations Section 1.704-2(b)(3).

         Section 1.56 "Operating Deficit" shall mean, for the applicable period,
insufficient  funds to pay  operating  costs  when  Cash  Expenses  exceed  Cash
Receipts,  as determined by the Accountant  and approved by the Special  Limited
Partner.

     Section 1.57  "Operating  Deficit  Guarantee  Period" shall mean the period
commencing  the  date the  first  apartment  unit in the  Apartment  Housing  is
available  for  its  intended  use  and  ending  three  years   following  three
consecutive  months of break-even  operations.  The Operating  Deficit Guarantee
Period  will not expire  unless  the  Partnership  has  achieved  Completion  of
Construction and Renovation of the Apartment Housing.

     Section 1.58 "Operating Loans" shall mean loans made by the General Partner
to the Partnership pursuant to Article VI of this Agreement,  which loans do not
bear  interest  and  are  repayable  only  as  provided  in  Article  XI of this
Agreement.

     Section 1.59 "Original Limited Partner" shall mean Donald W. Goulart, Jr.

     Section 1.60 "Partner(s)" shall collectively mean the General Partner,  the
Limited Partner and the Special  Limited  Partner or  individually  may mean any
Partner as the context dictates.

     Section 1.61 "Partner Nonrecourse Debt" shall have the meaning set forth in
Section 1.704-2(b)(4) of the Treasury Regulations.

     Section 1.62 "Partner  Nonrecourse Debt Minimum Gain" shall mean an amount,
with respect to each Partner  Nonrecourse Debt, equal to the Partnership Minimum
Gain that  would  result if such  Partner  Nonrecourse  Debt were  treated  as a

                                       13
<PAGE>

Nonrecourse  Liability,  determined in accordance with Section  1.704-2(i)(3) of
the Treasury Regulations.

     Section 1.63 "Partner Nonrecourse Deductions" shall have the meaning
set  forth  in  Sections  1.704-2  (i)(1)  and  1.704-2(i)(2)  of  the  Treasury
Regulations.

     Section 1.64  "Partnership"  shall mean the limited  partnership  continued
under this Agreement.

     Section 1.65 "Partnership Minimum Gain" shall mean the amount
determined in accordance  with the  principles of Treasury  Regulation  Sections
1.704-2(b)(2) and 1.704-2(d).

     Section 1.66 "Permanent Mortgage Commencement" shall mean the first
date on which all of the following  have  occurred:  (a) the Mortgage shall have
closed and funded and (b) amortization of the Mortgage shall have commenced.

     Section   1.67   "Person"   shall    collectively   mean   an   individual,
proprietorship, trust, estate, partnership, joint venture, association, company,
corporation or other entity.

     Section 1.68 "Plans and  Specifications"  shall mean the plans,  blueprints
and   specifications   manual  for  the   construction  and  renovation  of  the
Improvements  which are approved by the local  city/county  building  department
with  jurisdiction over the construction of the Improvements and which Plans and
Specifications are referred to in the Construction and Renovation Contract.  Any
changes  to the Plans  and  Specifications  after  approval  by the  appropriate
government  building department shall require the Consent of the Special Limited
Partner.

     Section 1.69 "Project  Documents" shall mean all documents  relating to the
Construction   and  Renovation   Loan,   Mortgage  Loan,   purchase  orders  and
Construction  and  Renovation  Contract.  It shall also  include  all  documents
required by any  governmental  agency  having  jurisdiction  over the  Apartment
Housing in connection with the development,  renovation, construction, financing
and related project based rent subsidies of the Apartment Housing, including but
not limited  to, the  approved  Plans and  Specifications  for the  development,
renovation and construction of the Apartment Housing and the HAP Contract.

     Section 1.70 "Projected  Annual Tax Credits" shall mean LIHTC in the amount
of $ 84,463 for 2000, $ 84,463 per year for each of the years 2002 through 2010,
which the General  Partner has  projected  to be the total amount of LIHTC which
will be allocated to the Limited Partner by the Partnership, constituting 99.98%
of the aggregate amount of LIHTC of $844,800 to be available to the Partnership.

     Section  1.71  "Projected  Tax Credits"  shall mean LIHTC in the  aggregate
amount of $844,800.

                                       14
<PAGE>

     Section 1.72 "Qualified Tenants" shall mean any tenants who have incomes of
60% (or such smaller  percentage as the General  Partner shall agree) or less of
the area median gross  income,  as adjusted  for family size,  so as to make the
Apartment Housing eligible for LIHTC.

     Section  1.73  "Rent  Restriction  Test"  shall mean the test  pursuant  to
Section  42 of the Code  whereby  the  gross  rent  charged  to  tenants  of the
low-income  apartment  units in the Apartment  Housing  cannot exceed 30% of the
qualifying  income levels of those units under Section 42 of the Code, except as
otherwise may be provided in Section 42(g)(2)(E).

     Section  1.74  "Reporting  Fee" shall have the meaning set forth in Section
9.2(d) hereof.

     Section 1.75  "Revised  Projected  Tax Credits"  shall have the meaning set
forth in Section 7.4(a) hereof.

     Section 1.76 "Sale or Refinancing" shall mean any of the following items or
transactions:  a  sale,  transfer,  exchange  or  other  disposition  of  all or
substantially  all of  the  assets  of the  Partnership,  a  condemnation  of or
casualty at the Apartment  Housing or any part thereof,  a claim against a title
insurance company,  the refinancing of any Mortgage or other indebtedness of the
Partnership and any similar item or  transaction;  provided,  however,  that the
payment of Capital  Contributions  by the Partners shall not be included  within
the meaning of the term "Sale or Refinancing."

     Section 1.77 "Sale or Refinancing Proceeds" shall mean all cash receipts of
the  Partnership  arising from a Sale or  Refinancing  (including  principal and
interest received on a debt obligation  received as consideration in whole or in
part, on a Sale or Refinancing) less the amount paid or to be paid in connection
with or as an expense  of such Sale or  Refinancing,  and with  regard to damage
recoveries or insurance or condemnation  proceeds, the amount paid or to be paid
for  repairs,  replacements  or  renewals  resulting  from  damage to or partial
condemnation of the Apartment Housing.

     Section 1.78 "Section 8" shall mean Section 8 of the United States  Housing
Act of 1937 and the regulations promulgated thereunder.

     Section 1.79  "Special  Limited  Partner"  shall mean WNC Housing,  L.P., a
California  limited  partnership,  and such other Persons as are admitted to the
Partnership as additional or substitute  Special  Limited  Partners  pursuant to
this Agreement.

     Section 1.80 "State" shall mean the State of Iowa.

     Section 1.81 "State Tax Credit  Agency" shall mean the state agency of Iowa
which has the  responsibility  and authority to administer  the LIHTC program in
Iowa.

                                       15
<PAGE>

     Section  1.82  "Substitute  Limited  Partner"  shall mean any Person who is
admitted to the  Partnership  as a Limited  Partner  pursuant to Section 12.5 or
acquires  the  Interest of the Limited  Partner  pursuant to Section 7.3 of this
Agreement.

     Section  1.83  "Syndication  Fee" shall mean the fee payable to the General
Partner in an amount  equal to $10,000  for the  General  Partner's  services in
forming the  Partnership,  locating and  approving  the Limited  Partner and the
Special  Limited  Partner as the investors in the  Partnership,  negotiating and
finalizing this Partnership  Agreement and for such other services referenced in
Treasury Regulation Section 1.709-2(B).

     Section 1.84 "Tax Credit" shall mean any credit permitted under the Code or
the law of any state  against the federal or a state income tax liability of any
Partner as a result of activities or expenditures of the Partnership  including,
without limitation, LIHTC.

     Section 1.85 "Tax Credit  Compliance Fee" shall mean the fee payable to the
General Partner in accordance with Section 9.2(f) of this Agreement.

     Section 1.86 "Tax Credit  Conditions"  shall mean,  for the duration of the
Compliance  Period,  any and all  restrictions  including,  but not  limited to,
applicable federal,  state and local laws, rules and regulations,  which must be
complied  with in  order  to  qualify  for the  LIHTC  or to  avoid  an event of
recapture in respect of the LIHTC.

     Section  1.87 "Tax  Credit  Period"  shall mean the  ten-year  time  period
referenced  in Code Section  42(f)(1)  over which the  Projected Tax Credits are
allocated to the  Partners.  It is the intent of the Partners that the Projected
Tax  Credits  will be  allocated  during the Tax Credit  Period and not a longer
term.

     Section 1.88 "Title Policy" shall mean the policy of insurance covering the
fee simple title to the Apartment Housing from a company approved by the Special
Limited  Partner.  The Title Policy shall be an ALTA owners title policy  naming
the  Partnership  as  insured  and  including  a   non-imputation   and  fairway
endorsement.   The  Title  Policy  shall  also  insure  against   rights-of-way,
easements, or claims of easements, not shown by public records. The Title Policy
shall be in an amount  equal to the  Mortgage  amount and the Limited  Partner's
Capital Contribution.

     Section 1.89 "TRA 1986" shall mean the Tax Reform Act of 1986.

     Section 1.90 "Treasury  Regulations"  shall mean the Income Tax Regulations
promulgated under the Code, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).

     Section  1.91  "Withdrawing"  or  "Withdrawal"  (including  the  verb  form
"Withdraw" and the adjectival forms  "Withdrawing" and "Withdrawn")  shall mean,
as to a General Partner,  the occurrence of the death,  adjudication of insanity

                                       16
<PAGE>

or  incompetence,  Bankruptcy  of  such  Partner,  the  withdrawal,  removal  or
retirement  from the  Partnership of such Partner for any reason,  including any
sale,  pledge,  encumbering,  assignment or other transfer of all or any part of
its General Partner  Interest and those situations when a General Partner may no
longer  continue  as a General  Partner by reason of any law or  pursuant to any
terms of this Agreement.

                                   ARTICLE II

                                      NAME

     The  name of the  Partnership  shall  be  "Hickory  Lane  Partners  Limited
Partnership."

                                   ARTICLE III

                  PRINCIPAL EXECUTIVE OFFICE/AGENT FOR SERVICE

     Section 3.1 Principal  Executive Office. The principal  executive office of
the  Partnership is located at 505 5th Street,  Suite 238, Sioux City, IA 51101,
or at such other  place or places  within the State as the  General  Partner may
hereafter designate.

     Section 3.2 Agent for Service of Process. The name of the agent for service
of process on the  Partnership  is Lewis F.  Weinberg,  whose address is 505 5th
Street, Suite 238, Sioux City, IA 51101.

                                   ARTICLE IV

                                     PURPOSE

     Section 4.1 Purpose of the  Partnership.  The purpose of the Partnership is
to acquire,  rehabilitate,  own and operate  the  Apartment  Housing in order to
provide,  in part, Tax Credits to the Partners in accordance with the provisions
of the Code and the Treasury Regulations applicable to LIHTC and to refinance or
sell the Apartment Housing.  The Partnership shall not engage in any business or
activity which is not incident to the attainment of such purpose.

     Section  4.2  Authority  of the  Partnership.  In order  to  carry  out its
purpose,  the Partnership is empowered and authorized to do any and all acts and
things  necessary,   appropriate,   proper,   advisable  or  incidental  to  the
furtherance and accomplishment of its purpose, and for protection and benefit of
the Partnership, including but not limited to the following:

                                       17
<PAGE>

         (a)  acquire ownership of the real property referred to in  Exhibit "A"
attached hereto;

         (b)  renovate,  rehabilitate, own,  maintain and  operate the Apartment
Housing in accordance with the Project Documents;

         (c)  provide  housing to  Qualified  Tenants,  subject  to the  Minimum
Set-Aside  Test  and  the  Rent   Restriction   Test  and  consistent  with  the
requirements of the Project Documents so long as any Project Documents remain in
force;

         (d) maintain and operate the Apartment  Housing,  including  hiring the
Management  Agent  (which  Management  Agent  may be any of the  Partners  or an
Affiliate  thereof) and entering into any  agreement  for the  management of the
Apartment  Housing during its rent-up and after its rent-up period in accordance
with this Agreement;

         (e) enter into the Loan and Mortgage;

         (f) rent dwelling units in the Apartment  Housing from time to time, in
accordance with the provisions of the Code applicable to LIHTC and in accordance
with the HAP Contract; and

         (g) do any and all  other  acts  and  things  necessary  or  proper  in
accordance with this Agreement.

                                    ARTICLE V

                                      TERM

     The  Partnership  term  commenced  upon the  filing of the  Certificate  of
Limited  Partnership  in the  office  of,  and on the form  prescribed  by,  the
Secretary  of State of the State,  and shall  continue  until  December 31, 2040
unless terminated earlier in accordance with the provisions of this Agreement or
as otherwise provided by law.

                                   ARTICLE VI

                    GENERAL PARTNER'S CONTRIBUTIONS AND LOANS

     Section 6.1 Capital  Contribution of General  Partner.  The General Partner
shall make a Capital Contribution equal to $35,000.

     Section 6.2 Construction and Renovation Obligations.

         (a) Lewis F.  Weinberg and Weinberg  Investments,  Inc.  ("Guarantors")
hereby  guarantees a lien free completion of construction  and renovation of the
Apartment Housing on or before December 15,  2000("Completion  Date") at a total
development  cost  of not  more  than  $2,369,600("Development  Budget"),  which
includes  all hard and soft  costs  incident  to the  acquisition,  development,
renovation  and  construction  of the Apartment  Housing in accordance  with the
Construction  Budget,  the  Construction  Contract,  and the Project  Documents,

                                       18
<PAGE>

except for  additional  expenditures  as approved by Limited  Partner or Special
Limited Partner. At any time during construction and renovation , if the Special
Limited Partner  ascertains  that the Development  Budget exceeds the sum of the
Capital  Contributions and the Mortgage amount then the General Partner shall be
responsible  for and shall be obligated  to pay the  difference  thereof  within
thirty days of receiving  written notice from the Special Limited Partner except
as otherwise provided for in this Agreement. Any advances by the General Partner
pursuant to the previous  sentence shall not be repayable,  shall not change the
Interest of any Partner in the  Partnership and shall be considered a guaranteed
payment to the Partnership for cost overruns.  Upon such notice from the Special
Limited Partner,  the General Partner shall advance the requested funds into the
Projects General Fund account.

         (b) In addition, if (1) the Improvements are not completed on or before
the Completion  Date (which date may be extended in the events of Force Majeure,
but in no event longer than three months from the Completion Date); (2) prior to
completing  the  Improvements,  the Lender  sends a notice of default  under the
Loan; or (3) a foreclosure action is commenced against the Partnership,  then at
the Special  Limited  Partner's  election,  either the General  Partner  will be
removed from the Partnership and the Special Limited Partner will be admitted as
successor  General Partner,  all in accordance with Article XIII hereof,  or the
General  Partner will  repurchase  the  Interest of the Limited  Partner and the
Special Limited Partner for an amount equal to the amounts  theretofore  paid by
the Limited Partner and the Special Limited Partner, and the Limited Partner and
the Special Limited Partner shall have no further  Interest in the  Partnership.
If the Special  Limited  Partner elects to have the General  Partner  repurchase
such Interests then the repurchase  shall occur within 60 days after the General
Partner receives written demand from the Special Limited Partner. If the Special
Limited  Partner  elects to remove the General  Partner then the  provisions  of
Article XIII apply.

     Section 6.3 Operating Obligations.

         (a) From the date the first apartment unit in the Apartment  Housing is
available  for its intended  use until three  consecutive  months of  Break-even
Operations,  the General Partner will immediately provide to the Partnership the
necessary funds to pay Operating  Deficits,  which funds shall not be repayable,
shall  not  change  the  Interest  of any  Partner  and  shall be  considered  a
guaranteed payment to the Partnership for cost overruns.  For the balance of the
Operating Deficit Guarantee Period the General Partner will immediately  provide
Operating Loans to pay any Operating  Deficits.  The aggregate maximum amount of
the  Operating  Loan(s) the General  Partner  will be  obligated to lend will be
equal to one year's operating expenses (including debt and reserves) approved by

                                       19
<PAGE>

the General Partner and the Special Limited  Partner.  Each Operating Loan shall
be  nonrecourse  to the  Partners,  and  shall  be  repayable  out of 50% of the
available Net  Operating  Income or Sale or  Refinancing  Proceeds in accordance
with Article XI of this Agreement.

         (b) In the event the General  Partner is unable to obtain an  extension
of the  expiring  HAP  Contract,  the General  Partner  will fund any  operating
deficit  exclusive of  replacement  reserves  which may be required by Lender or
Special  Limited  Partner,  as a  result  of lost  revenue  associated  with the
expiration  of the HAP  Contract.  Any  funding  under  Section  6.3(b)  of this
Agreement  shall be made in the form of a note and shall accrue  interest at the
same rate as the 5 year treasury note in effect at the time of the funding.

     Section 6.4 Other General Partner Loans.  After expiration of the Operating
Deficit Guarantee Period,  with the Consent of the Special Limited Partner,  the
General Partner may loan to the Partnership any sums required by the Partnership
and not  otherwise  reasonably  available to it. Any such loan shall bear market
interest (not compounded) at the 10-year Treasury money market rate in effect as
of the day of the General  Partner loan, or, if lesser,  the maximum legal rate.
The maturity date and repayment  schedule of any such loan shall be as agreed to
by the General  Partner and the Special Limited  Partner.  The terms of any such
loan shall be evidenced by a written  instrument.  The General Partner shall not
charge a prepayment  penalty on any such loan. Any loan in contravention of this
Section shall be deemed an invalid action taken by the General  Partner and such
advance will be classified as a General Partner Capital Contribution.

                                   ARTICLE VII

                    CAPITAL CONTRIBUTIONS OF LIMITED PARTNER
                           AND SPECIAL LIMITED PARTNER

     Section 7.1 Original Limited  Partner.  The Original Limited Partner made a
Capital  Contribution  of $0.  Effective as of the date of this  Agreement,  the
Original Limited Partner's  Interest has been liquidated and the Partnership has
reacquired  the Original  Limited  Partner's  Interest in the  Partnership.  The
Original  Limited Partner  acknowledges  that it has no further  interest in the
Partnership  as a  limited  partner  as of the date of this  Agreement,  and has
released  all  claims,  if  any,  against  the  Partnership  arising  out of its
participation as a limited partner.

     Section 7.2 Capital  Contribution of Limited  Partner.  The Limited Partner
shall make a Capital Contribution in the amount of $633,473,  as may be adjusted
in  accordance  with  Section  7.4 of this  Agreement,  in cash on the dates and
subject to the conditions hereinafter set forth.

                                       20
<PAGE>

         (a) $252,000 shall be payable upon the  Limited  Partner's  receipt and
approval of the following documents:

                  (1) a legal opinion in a form  substantially  similar  to  the
form of opinion  attached hereto as Exhibit "B" and incorporated herein by  this
reference;

                  (2) a fully executed  Certification  and Agreement in the form
attached  hereto as Exhibit "C" and  incorporated herein by this reference;

                  (3) a copy of a title  commitment,  (in a form  and  substance
satisfactory to the Special Limited  Partner)  constituting an agreement by such
title company to issue the Title Policy within  fifteen  working days. The title
commitment  will show the  Apartment  Housing to be free from  liens  except the
Construction Loan and free from other exceptions not previously  approved by the
Special Limited Partner;

                  (4) Insurance required during construction and renovation; and

                  (5) a copy of the recorded grant deed (warranty deed).

         (b) $220,000 shall be payable upon the  Limited  Partner's receipt  and
approval of the following documents:

                  (1) the  Inspecting Architect's certification of fifty percent
completion  of the  total  construction  and renovation; and

                  (2)  the  construction  and  renovation   documents   required
pursuant to Section 14.3(a) of this Agreement, if not previously provided to the
Limited Partner and a determination by the Special Limited Partner that mortgage
financing is In-Balance.

         (c)  $161,473 shall be payable upon the Limited  Partner's receipt  and
approval of the following documents:

                  (1)  Completion of Construction or Renovation;

                  (2)  a certificate of  occupancy (or  equivalent  evidence  of
local occupancy approval if a permanent certificate is not available) on all the
apartment units in the Apartment Housing;

                  (3) a completion certification in a form substantially similar
to the form  attached  hereto as  Exhibit  "D" and  incorporated  herein by this
reference,  indicating that the  Improvements  have been completed in accordance
with the Project Documents;

                  (4) a  letter  from  the  Contractor  in a form  substantially
similar to the form attached  hereto as Exhibit "F" and  incorporated  herein by

                                       21
<PAGE>

this reference stating that all amounts payable to the Contractor have been paid
in full  and  that  the  Partnership  is not in  violation  of the  Construction
Contract;

                  (5)  Insurance required during operations; and

                  (6)  the  construction  and  renovation   documents   required
pursuant to Section 14.3(a) of this Agreement, if not previously provided to the
Limited  Partner  and a  determination  by  the  Special  Limited  Partner  that
financing is In-Balance.

                  (7)  Mortgage Loan documents signed and the Mortgage funded;

                  (8)  endorsement  to the Title  Policy  dated no more than ten
days prior to the scheduled  Capital  Contribution  providing an as-built survey
and confirming that there are no liens,  claims or rights to a lien or judgments
filed against the property or the Apartment Housing during the time period since
the issuance of the Title Policy referenced above in Section 7.2(a);

                  (9)      the  current  rent  roll  evidencing  a  minimum  90%
occupancy by  Qualified  Tenants for 90  consecutive  days immediately prior  to
funding;

                  (10) copies of all initial  tenant files  including  completed
applications,  completed  questionnaires  or  checklist  of income  and  assets,
documentation  of third  party  verification  of income and  assets,  and income
certification  forms (LIHTC  specific)  collected by the  Management  Agent,  or
General  Partner,  verifying each tenant's  eligibility  pursuant to the Minimum
Set-Aside Test;

                  (11) copies of the executed lease agreement with the tenants.

                  (12) a    copy   of    the    declaration    of    restrictive
covenants/extended  use  agreement  entered  into  between  the Partnership  and
the State Tax Credit Agency;

                  (13) an audited construction and renovation cost certification
(which includes an itemized cost breakdown);

                  (14) the Accountant's final Tax Credit certification in a form
substantially   similar  to  the  form  attached   hereto  as  Exhibit  "E"  and
incorporated herein by this reference;

                  (15)  Debt Service Coverage of 1.15 for  90  consecutive  days
immediately prior to funding;

                  (16)  Internal Revenue Code Form 8609, or any successor form;

                                       22
<PAGE>

                  (17)  confirmation in writing by  the  General  Partner  as to
whether it will provide to the Special Limited Partner:

                              (a) a commitment  from a  national  bank to  issue
                                  an irrevocable Letter of Credit to the project
                                  in the amount of $50,000 by  March 1, 2004 for
                                  the purposes of covering any mortgage interest
                                  increase;  or
                              (b) a project debt service  reserve  fund  of  not
                                  less than  $50,000 fully funded prior to March
                                  1, 2004; and

                  (18) any  documents  previously  not  provided  to the Limited
Partner but required pursuant to this Section 7.2 and Sections 14.3(a) and (b).

     Section 7.3 Repurchase of Limited Partner's Interest.  Within 60 days after
the General Partner  receives written demand from the Limited Partner and/or the
Special Limited Partner,  the Partnership shall repurchase the Limited Partner's
Interest  and/or the Special  Limited  Partner's  Interest in the Partnership by
refunding  to it in cash the full amount of the Capital  Contribution  which the
Limited Partner and/or the Special  Limited Partner has theretofore  made in the
event that, for any reason, the Partnership shall fail to:

         (a) cause the Apartment Housing to be placed in service by December 15,
2000;

         (b) achieve 90% occupancy of the Apartment Housing by Qualified Tenants
by January 01, 2001;

         (c) obtain Permanent Mortgage Commencement by January 01, 2001;

         (d) meet both the Minimum  Set-Aside Test and the Rent Restriction Test
not later than December 31 of the first year the Partnership elects the LIHTC to
commence in accordance with the Code; or

         (e) obtain a carryover allocation,  within the meaning of Section 42 of
the Code, from the State Tax Credit Agency on or before December 31, 2000.

     Section 7.4 Adjustment of Capital Contributions.

         (a) The  amounts  of the  Limited  Partner's  and the  Special  Limited
Partner's Capital  Contributions  were determined in part upon the amount of Tax
Credits that were expected to be available to the Partnership,  and was based on
the  assumption  that  the  Partnership  would  be  eligible  to  claim,  in the
aggregate, the Projected Tax Credits. If the anticipated amount of Projected Tax
Credits to be allocated to the Limited  Partner and Special  Limited  Partner as
evidenced by IRS Form 8609, Schedule A thereto,  provided to the Limited Partner
and Special Limited Partner are less than $844,716 (the new Projected Tax Credit

                                       23
<PAGE>

amount,  if  applicable,  shall be referred  to as the  "Revised  Projected  Tax
Credits")  then the Limited  Partner's  and Special  Limited  Partner's  Capital
Contribution  provided for in Section 7.2 and Section 7.5 respectively  shall be
adjusted by the amount which will make the total Capital Contribution to be paid
by the Limited Partner and Special  Limited Partner to the Partnership  equal to
0.785 of the Revised Projected Tax Credits so anticipated to be allocated to the
Limited  Partner  and  Special  Limited  Partner.  If any  Capital  Contribution
adjustment  referenced  in this Section  7.4(a) is a reduction  which is greater
than the remaining Capital  Contribution to be paid by the Partner whose Capital
Contribution is being adjusted,  then the General Partner shall have ninety days
from the date the  General  Partner  receives  notice  from  either the  Limited
Partner or the Special Limited Partner to pay the shortfall to the Partner whose
Capital Contribution is being adjusted.  If the Capital Contribution  adjustment
referenced in this Section  7.4(a) is an increase then the Partner whose Capital
Contribution  is being adjusted shall have thirty days from the date the Limited
Partner  and  Special  Limited  Partner  have  received  notice from the General
Partner to pay the increase.

         (b) The General  Partner is  required  to use its best  efforts to rent
100% of the Apartment  Housing's apartment units to tenants who meet the Minimum
Set-Aside Test throughout the Compliance  Period.  If at the end of any calendar
year  during  the first  five  calendar  years  following  the year in which the
Apartment  Housing  is placed in  service,  the Actual Tax Credit for any fiscal
year or portion thereof is or will be less than the Projected Annual Tax Credit,
or the  Projected  Annual  Tax  Credit as  modified  by  Section  7.4(a) of this
Agreement if applicable (the "Annual Credit  Shortfall"),  then the next Capital
Contribution  owed by the Limited  Partner shall be reduced by the Annual Credit
Shortfall  amount,  and any portion of such Annual Credit Shortfall in excess of
such  Capital  Contribution  shall  be  applied  to  reduce  succeeding  Capital
Contributions of the Limited Partner.  If the Annual Credit Shortfall is greater
than the Limited  Partner's  remaining  Capital  Contributions  then the General
Partner  shall  pay to the  Limited  Partner  the  excess of the  Annual  Credit
Shortfall over the remaining  Capital  Contributions.  The General Partner shall
have sixty days to pay the Annual  Credit  Shortfall  from the date the  General
Partner receives notice from the Special Limited Partner. The provisions of this
Section 7.4(b) shall apply equally to the Special  Limited Partner in proportion
to its Capital Contribution and anticipated annual Tax Credit.

         (c) In the event that, for any reason, at any time after the first five
calendar  years  following the year in which the Apartment  Housing is placed in
service, there is an Annual Credit Shortfall, then there shall be a reduction in
the General  Partner's  share of Net Operating  Income in an amount equal to the
Annual Credit Shortfall and said amount shall be paid to the Limited Partner. In
the event there are not sufficient funds to pay the full Annual Credit Shortfall

                                       24
<PAGE>

to the Limited  Partner at the time of the next  Distribution  of Net  Operating
Income, then the unpaid Annual Credit Shortfall shall be repaid in the next year
in which sufficient monies are available from the General Partner's share of Net
Operating  Income.  In the event a Sale or Refinancing of the Apartment  Housing
occurs prior to repayment in full of the Annual Credit Shortfall then the excess
will be paid in accordance with Section 11.2(b).  The provisions of this Section
7.4(b) shall apply equally to the Special  Limited  Partner in proportion to its
Capital Contribution and anticipated annual Tax Credit.

         (d) The General  Partner  has  represented,  in part,  that the Limited
Partner  will  receive  Projected  Annual Tax  Credits of $ 84,463 in 2001 and $
84,463 in 2002.  In the event the 2001 or 2002  Actual Tax Credits are less than
projected then the Limited Partner's Capital Contribution shall be reduced by an
amount  equal to .785 times the  difference  between  the  Projected  Annual Tax
Credits  for 2001 or 2002 and the Actual Tax  Credits  for 2001 or 2002.  If the
2001 or 2002 Actual Tax Credits are less than projected then the Special Limited
Partner's  Capital  Contribution  shall be reduced  following  the same equation
referenced in the preceding sentence.  If, at the time of determination thereof,
the Capital Contribution adjustment referenced in this Section 7.4(d) is greater
than the balance of the Limited  Partner's or Special Limited  Partner's Capital
Contribution  payment which is then due, if any, then the excess amount shall be
paid by the General  Partner to the Limited  Partner and/or the Special  Limited
Partner  within  sixty  days of the  General  Partner  receiving  notice  of the
reduction from the Limited Partner and/or the Special Limited Partner.

         (e) The Partners recognize and acknowledge that the Limited Partner and
the Special Limited Partner are making their Capital  Contribution,  in part, on
the  expectation  that the  Projected  Tax Credits are allocated to the Partners
over the Tax Credit  Period.  If the  Projected Tax Credits are not allocated to
the Partners during the Tax Credit Period then the Limited Partner's and Special
Limited Partner's Capital Contribution shall be reduced by an amount agreed upon
by the Partners,  in good faith,  to provide the Limited Partner and the Special
Limited Partner with their anticipated internal rate of return.

         (f)  In the  event  there  is:  (1) a  filing  of a tax  return  by the
Partnership  evidencing a reduction in the qualified  basis or eligible basis of
the Apartment Housing causing a recapture of Tax Credits previously allocated to
the Limited Partner; (2) a reduction in the qualified basis or eligible basis of
the Apartment Housing for income tax purposes following an audit by the Internal
Revenue  Service  (IRS)  resulting  in a recapture  or  reduction of Tax Credits
previously claimed;  (3) a decision by the United States Tax Court upholding the
assessment of such deficiency  against the  Partnership  with respect to any Tax
Credit previously claimed in connection with the Apartment  Housing,  unless the
Partnership  shall  timely  appeal  such  decision  and the  collection  of such
assessment  shall be stayed  pending the  disposition  of such appeal;  or (4) a
decision of a court  affirming  such decision upon such appeal then, in addition
to any other payments to which the Limited  Partner  and/or the Special  Limited
Partner are entitled  under the terms of this  Section 7.4, the General  Partner

                                       25
<PAGE>

shall pay to the Limited  Partner and the Special  Limited  Partner within sixty
days of receiving  notice from the Limited  Partner  and/or the Special  Limited
Partner the sum of (A) the amount of the Tax Credit recapture,  (B) any interest
and penalties  imposed on the Limited  Partner or Special  Limited  Partner with
respect to such recapture, and (C) an amount sufficient to pay any tax liability
owed by the  Limited  Partner  or Special  Limited  Partner  resulting  from the
receipt of the amounts specified in (A) and (B).

         (g) The increase in the Capital Contribution of the Limited Partner and
the Special Limited  Partner  pursuant to Section 7.4(a) shall be subject to the
Limited  Partner and Special  Limited  Partner having funds available to pay any
such  increase  at the time of its  notification  of such  increase.  For  these
purposes,  any funds theretofore  previously earmarked by the Limited Partner or
Special  Limited  Partner to make other  investments,  or to be held as required
reserves, shall not be considered available for payment hereunder.

     Section 7.5 Capital  Contribution of Special Limited  Partner.  The Special
Limited  Partner  shall  make a Capital  Contribution  of $63 at the time of the
Limited Partner's Capital Contribution payment referenced in Section 7.2(a) upon
the same  conditions.  The Special Limited Partner shall be in a different class
from the Limited  Partner  and,  except as  otherwise  expressly  stated in this
Agreement,  shall not  participate in any rights  allocable to or exercisable by
the Limited Partner under this Agreement.

     Section  7.6  Return  of  Capital  Contribution.  From  time  to  time  the
Partnership  may have cash in excess of the amount  required  for the conduct of
the affairs of the Partnership, and the General Partner may, with the Consent of
the Special  Limited  Partner,  determine that such cash should,  in whole or in
part,  be returned to the  Partners,  pro rata,  in reduction  of their  Capital
Contribution.  No such  return  shall  be made  unless  all  liabilities  of the
Partnership  (except  those to Partners  on account of amounts  credited to them
pursuant  to this  Agreement)  have  been  paid or there  remain  assets  of the
Partnership  sufficient,  in the sole discretion of the General Partner,  to pay
such  liabilities.  The Partnership  acknowledges that the Project is subject to
the  limitations  and  restrictions  imposed by the HAP Contract,  including the
annual limited dividend and disposition of Residual Receipts.

     Section 7.7 Liability of Limited Partner and Special Limited  Partner.  The
Limited  Partner and Special  Limited Partner shall not be liable for any of the
debts,  liabilities,  contracts or other  obligations  of the  Partnership.  The
Limited Partner and Special Limited Partner shall be liable only to make Capital

                                       26
<PAGE>

Contributions  in the amounts and on the dates  specified in this Agreement and,
except as otherwise expressly required hereunder,  shall not be required to lend
any funds to the Partnership or, after their  respective  Capital  Contributions
have been paid, to make any further Capital Contribution to the Partnership.

                                  ARTICLE VIII

                          WORKING CAPITAL AND RESERVES

     Section 8.1 Operating and  Maintenance  Account.  The General  Partner,  on
behalf of the Partnership,  shall establish an operating and maintenance account
and shall deposit thereinto an annual amount equal to $ 200 per residential unit
per year,  or such  greater sum as may be  required  by HUD,  for the purpose of
repairs,  maintenance  and  capital  improvements.  Said  deposit  shall be made
monthly in equal installments.  Withdrawals from such account shall be made only
with the Consent of the Special Limited  Partner.  Any balance  remaining in the
account at the time of a sale of the  Apartment  Housing  shall be allocated and
distributed equally between the General Partner and the Limited Partner, subject
the restrictions stated in the Project's HAP Contract.

     Section 8.2 Tax and Insurance  Account.  The General Partner,  on behalf of
the Partnership,  shall establish a tax and insurance  account ("T & I Account")
for the purpose of making the requisite  Insurance premium payments and the real
estate tax  payments.  The annual  deposit to the T & I Account  shall equal the
total  annual  Insurance  payment and the total  annual real estate tax payment.
Said amount shall be deposited monthly in equal  installments.  Withdrawals from
such account shall be made only for its intended purpose.  Any balance remaining
in the account at the time of a sale of the Apartment Housing shall be allocated
and distributed equally between the General Partner and the Limited Partner.

     Section  8.3  Other  Reserves.  The  General  Partner,  on  behalf  of  the
Partnership,  may establish out of funds  available to the Partnership a reserve
account  sufficient in its sole  discretion to pay any unforeseen  contingencies
which might arise in connection with the furtherance of the Partnership business
including,  but not limited to, (a) any rent subsidy  required to maintain  rent
levels in compliance with the Tax Credit Conditions; and (b) any debt service or
other payments for which other funds are not provided for hereunder or otherwise
expected to be available to the  Partnership.  The General  Partner shall not be
liable  for any  good-faith  estimate  which it shall  make in  connection  with
establishing  or maintaining  any such reserves nor shall the General Partner be
required to establish or maintain any such reserves if, in its sole  discretion,
such reserves do not appear to be necessary.

                                       27
<PAGE>

                                   ARTICLE IX

                             MANAGEMENT AND CONTROL

     Section 9.1 Power and Authority of General Partner.  Subject to the Consent
of the  Special  Limited  Partner or the consent of the  Limited  Partner  where
required by this  Agreement,  HUD pursuant to the project's HAP Contract and the
other  limitations  and  restrictions  included in this  Agreement,  the General
Partner  shall have complete and  exclusive  control over the  management of the
Partnership business and affairs, and shall have the right, power and authority,
on behalf of the  Partnership,  and in its name,  to exercise all of the rights,
powers and authority of a partner of a partnership without limited partners. The
General  Partners  hereby appoint Lewis F. Weinberg as Managing  General Partner
and to act as the Tax Matters General Partner.  All acts,  decisions or consents
of the General  Partners  shall  require a simple  majority  vote of the General
Partners. No Limited Partner or Special Limited Partner (except one who may also
be a General  Partner,  and then only in its capacity as General  Partner within
the scope of its authority  hereunder)  shall have any right to be active in the
management  of the  Partnership's  business or  investments  or to exercise  any
control  thereover,  nor have the right to bind the Partnership in any contract,
agreement,  promise or undertaking, or to act in any way whatsoever with respect
to the  control  or  conduct  of the  business  of the  Partnership,  except  as
otherwise specifically provided in this Agreement.

     Section 9.2 Payments to the General Partners and Others.

         (a) The Partnership shall pay to the Developer a Development Fee in the
amount of $250,000 in accordance with the Development Fee Agreement entered into
by and between the Developer and the  Partnership  on the even date hereof.  The
Development  Fee Agreement  provides,  in part,  that the  Development Fee shall
first be paid from available  proceeds in accordance with Section 9.2(b) of this
Agreement and if not paid in full then the balance of the  Development  Fee will
be paid in accordance with Section 11.1 of this Agreement.

         (b) The  Partnership  shall  utilize  the  proceeds  from  the  Capital
Contributions paid pursuant to Section 7.2 and Section 7.5 of this Agreement for
development and renovation costs including, but not limited to, land costs, Land
Acquisition Fee,  acquisition  cost of existing  building,  architectural  fees,
survey and engineering  costs,  financing  costs,  loan fees,  Syndication  Fee,
building materials and labor. If any Capital Contribution proceeds are remaining
after   Completion  of   Construction   and  Renovation  and  all   acquisition,
development,  renovation and construction costs,  excluding the Development Fee,
are paid in full , then the remainder  shall:  first be paid to the Developer in
payment  of the  Development  Fee;  second be paid to the  General  Partner as a
reduction  of the General  Partner's  Capital  Contribution;  and any  remaining
Capital  Contribution  proceeds  shall  be  paid  to the  General  Partner  as a
Partnership oversight fee.

                                       28
<PAGE>

         (c) The  Partnership  shall  pay to the  Management  Agent  a  property
management  fee for the leasing and  management of the  Apartment  Housing in an
amount in accordance with the Management  Agreement,  subject to receiving prior
written consent from HUD. The term of the Management  Agreement shall not exceed
one year,  and the  execution or renewal of any  Management  Agreement  shall be
subject  to the  prior  Consent  of the  Special  Limited  Partner  and HUD,  if
applicable.  If the Management Agent is an Affiliate of the General Partner then
commencing with the termination of the Operating  Deficit  Guarantee  Period, in
any year in which the  Apartment  Housing has an Operating  Deficit,  40% of the
management fee will be deferred ("Deferred  Management Fee") Deferred Management
Fees, if any, shall be paid to the Management  Agent in accordance  with Section
11.1 of this Agreement.

                  (1) The General Partner shall dismiss the Management  Agent at
the  request  of the  Special  Limited  Partner as the  entity  responsible  for
management of the Apartment Housing under the terms of the Management Agreement.

                  (2) The  appointment  of any  successor  Management  Agent  is
subject to the Consent of the Special Limited Partner and HUD, which may only be
sought after the General  Partner has provided the Special  Limited  Partner and
HUD with accurate and complete  disclosure  respecting  the proposed  Management
Agent.

         (d) The  Partnership  shall pay to the Limited  Partner a Reporting Fee
commencing in 2001 equal to 15% of the Net Operating Income but in no event more
than $3,000 for the Limited Partner's services in assisting with the preparation
of tax  returns  and the  reports  required  in  Sections  14.2 and 14.3 of this
Agreement.  The Reporting  Fee shall be payable  within  seventy-five  (75) days
following  each calendar year and shall be payable from Net Operating  Income in
the manner and priority set forth in Section 11.1 of this  Agreement;  provided,
however,  that if in any year Net Operating  Income is  insufficient  to pay the
lesser of 15% or the full $3,000, the unpaid portion thereof shall accrue and be
payable on a cumulative basis in the first year in which there is sufficient Net
Operating Income, as provided in Section 11.1, or sufficient Sale or Refinancing
Proceeds, as provided in Section 11.2.

         (e) The  Partnership  shall  pay to the  General  Partner  through  the
Compliance  Period an annual  Incentive  Management Fee equal to 35% of net cash
flow  commencing in 2001 for overseeing  the  marketing,  lease-up and continued
occupancy of the  Partnership's  apartment  units,  obtaining and monitoring the
Mortgage Loan,  maintaining the books and records of the Partnership,  selecting
and supervising  the  Partnership's  Accountants,  bookkeepers and other Persons
required to prepare and audit the  Partnership's  financial  statements  and tax
returns, and preparing and disseminating  reports on the status of the Apartment
Housing and the  Partnership,  all as required by Article XIV of this Agreement.
The Partners  acknowledge that the Incentive  Management Fee is being paid as an

                                       29
<PAGE>

inducement to the General  Partner to operate the  Partnership  efficiently,  to
maximize  occupancy  and to increase the Net  Operating  Income.  The  Incentive
Management  Fee shall be  payable  from Net  Operating  Income in the manner and
priority  set  forth in  Section  11.1 of this  Agreement  upon  completion  and
delivery of the annual audit pursuant to Section 14.2(a) of this Agreement.  The
Partnership  acknowledges  the project is subject to the annual limited dividend
restrictions  established  by HUD for  post  1980  new  construction  Section  8
projects.  HUD's has  determined  the maximum annual 6% return on the originally
(1983)  determined  equity is $15,239  per annum.  This  Section is subject  and
subordinate  to the  applicable  provisions of the HAP Contract for the project,
which  the  partnership  has  agreed  to be bound  by and  comply  with.  If the
Incentive Management Fee is not paid in any year it shall not accrue for payment
in subsequent years.

         (f) The  Partnership  shall  pay to the  General  Partner  through  the
Compliance  Period an annual Tax Credit  Compliance Fee equal to 35% of net cash
flow  commencing  in 2001 for the  services of the  General  Partner in ensuring
compliance  by the  Partnership  and the  Apartment  Housing with all Tax Credit
rules and regulations.  The Tax Credit  Compliance Fee shall be payable from Net
Operating  Income in the manner and  priority  set forth in Section 11.1 of this
Agreement  upon  completion and delivery of the annual audit pursuant to Section
14.2(a) of this Agreement.  If the Tax Credit  Compliance Fee is not paid in any
year it shall not accrue for payment in subsequent years.

         (g) The Limited Partner will reimburse the General Partner in an amount
not to exceed  $29,565 for costs  incurred  by the General  Partner for a market
study,   environmental   study,   engineering   review,   soils  review,   title
verification,  carryover  consultation  and any  other  due  diligence  expenses
incurred by the  General  Partner and  approved  by the  Limited  Partner.  Said
reimbursement to be due at time of billing by the General Partner.

     Section 9.3 Specific  Powers of the General  Partner.  Subject to the other
provisions of this Agreement, the General Partner, in the Partnership's name and
on its behalf, may:

         (a)  employ,  contract  and  otherwise  deal  with,  from time to time,
Persons  whose  services  are  necessary  or  appropriate  in  connection   with
management  and  operation  of  the  Partnership  business,  including,  without
limitation,  contractors,  agents,  brokers,  Accountants and Management  Agents
(provided that the selection of any Accountant or Management  Agent has received
the  Consent  of the  Special  Limited  Partner  and HUD where  applicable)  and
attorneys, on such terms as the General Partner shall determine within the scope
of this Agreement;

         (b)  pay as a  Partnership  expense  any  and all  costs  and  expenses
associated with the formation,  development,  organization  and operation of the

                                       30
<PAGE>

Partnership,  including  the  expense of annual  audits,  tax  returns and LIHTC
compliance;

         (c)  deposit,   withdraw,   invest,  pay,  retain  and  distribute  the
Partnership's  funds  in  a  manner  consistent  with  the  provisions  of  this
Agreement,  subject  to the  obligations  and  limitations  imposed  by the  HAP
Contract;

         (d)   execute the Mortgage; and

         (e)   execute, acknowledge and  deliver  any  and  all  instruments  to
effectuate any of the foregoing.

     Section 9.4  Authority  Requirements.  During the  Compliance  Period,  the
following provisions shall apply.

         (a) Each of the provisions of this  Agreement  shall be subject to, and
the  General  Partner  covenants  to act in  accordance  with,  the  Tax  Credit
Conditions and all applicable federal, state and local laws and regulations.

         (b) The Tax Credit  Conditions  and all such laws and  regulations,  as
amended  or  supplemented,  shall  govern  the  rights  and  obligations  of the
Partners,  their heirs,  executors,  administrators,  successor and assigns, and
they shall  control  as to any terms in this  Agreement  which are  inconsistent
therewith,   and  any  such  inconsistent  terms  of  this  Agreement  shall  be
unenforceable by or against any of the Partners.

         (c) Upon any  dissolution  of the  Partnership  or any  transfer of the
Apartment  Housing,  no  title or right to the  possession  and  control  of the
Apartment  Housing  and no right to  collect  rent  therefrom  shall pass to any
Person who is not, or does not become,  bound by the Tax Credit  Conditions in a
manner  that,  in the  opinion  of  counsel to the  Partnership,  would  avoid a
recapture of Tax Credits thereof on the part of the former owners.

         (d) Any  conveyance  or  transfer of title to all or any portion of the
Apartment  Housing  required  or  permitted  under this  Agreement  shall in all
respects be subject to the Tax Credit  Conditions and all conditions,  approvals
or other  requirements of the rules and regulations of any authority  applicable
thereto.

     Section  9.5   Limitations  on  General   Partner's  Power  and  Authority.
Notwithstanding  the  provisions  of this Article IX, the General  Partner shall
not:

         (a)  except as required by Section 9.4, act in contravention of this
Agreement;

         (b)  act in any manner which would make it impossible to carry on the
ordinary business of the Partnership;

                                       31
<PAGE>

         (c)  confess a judgment against the Partnership;

         (d)  possess Partnership  property,  or assign the Partner's right in
specific  Partnership  property,  for other than the
exclusive benefit of the Partnership;

         (e)  admit a Person as a General Partner except as provided in this
Agreement;

         (f)  admit a Person as a Limited Partner or Special Limited Partner
except as provided in this Agreement;

         (g)  violate any provision of the Mortgage;

         (h)  cause the Apartment Housing apartment units to be rented to anyone
other than Qualified Tenants;

         (i)  violate the Minimum Set-Aside Test or the Rent Restriction Test
for the Apartment Housing;

         (j)  cause any recapture of the Tax Credits;

         (k) permit any creditor who makes a nonrecourse loan to the Partnership
to have,  or to acquire at any time as a result of making such loan,  any direct
or indirect  interest in the profits,  income,  capital or other property of the
Partnership, other than as a secured creditor;

         (l)  commingle funds of the Partnership with the funds of another
Person; or

         (m) take any action which  requires the Consent of the Special  Limited
Partner or the consent of the  Limited  Partner  unless the General  Partner has
received said Consent.

     Section 9.6  Restrictions  on  Authority  of General  Partner.  Without the
Consent of the Special Limited Partner the General Partner shall not:

         (a)  sell,  exchange,  lease  (except in the normal course of business
to Qualified  Tenants) or otherwise  dispose of the
Apartment Housing;

         (b)  incur indebtedness other than the Construction Loan and Mortgage
in the name of the Partnership;

         (c)  engage  in any  transaction  not  expressly  contemplated  by this
Agreement in which the General  Partner has an actual or  potential  conflict of
interest with the Limited Partner or the Special Limited Partner;

                                       32
<PAGE>

         (d)  contract away the fiduciary duty owed to the Limited Partner and
the Special Limited Partner at common law;

         (e) take any action which would cause the Apartment  Housing to fail to
qualify,   or  which  would  cause  a  termination  or   discontinuance  of  the
qualification  of the  Apartment  Housing,  as a "qualified  low income  housing
project"  under  Section  42(g)(1)  of the Code,  as amended,  or any  successor
thereto,  or which  would  cause  the  Limited  Partner  to fail to  obtain  the
Projected Tax Credits or which would cause the recapture of any LIHTC;

         (f)  make  any  expenditure  of  funds,  or  commit  to make  any  such
expenditure,  other than in response to an emergency,  except as provided for in
the annual  budget  approved  by the  Special  Limited  Partner,  as provided in
Section 14.3 (k) hereof;

         (g)  cause the merger or other reorganization of the Partnership;

         (h)  dissolve the Partnership;

         (i) acquire any real or personal  property  (tangible or intangible) in
addition to the  Apartment  Housing the  aggregate  value of which shall  exceed
$10,000 (other than easement or similar rights  necessary or appropriate for the
operation of the Apartment Housing);

         (j)  become  personally  liable  on or in  respect  of, or  guarantee,
the  Mortgage  or any  other  indebtedness  of thePartnership;

         (k) pay any salary,  fees or other compensation to a General Partner or
any  Affiliate  thereof,  except as  authorized  by Section  9.2 and Section 9.9
hereof or specifically provided for in this Agreement;

         (l) terminate  the services of the  Accountant,  Inspecting  Architect,
Contractor or Management  Agent, or terminate,  amend or modify the Construction
Contract or any other Project Document,  or grant any material waiver or consent
thereunder;

         (m)  cause the Partnership to redeem or repurchase all or any portion
of the Interest of a Partner;

         (n)  cause the Partnership to convert the Apartment Housing to
cooperative or condominium ownership;

         (o)  cause or permit the Partnership to make loans to the General
Partner or any Affiliate;

         (p)  bring or defend, pay, collect,  compromise,  arbitrate,  resort to
legal action or otherwise adjust claims or demands of or against the
Partnership; or

                                       33
<PAGE>

         (q)  agree or consent to any changes in the Plans and  Specifications,
to any change  orders, or to any of the terms and provisions of the Construction
Contract.

     Section 9.7 Duties of General  Partner.  The General Partner agrees that it
shall at all times:

         (a)  diligently and faithfully  devote such of its time to the
business of the Partnership as may be necessary to properly conduct the affairs
of the Partnership;

         (b) file and publish all certificates,  statements or other instruments
required by law for the formation and operation
of the Partnership as a limited partnership in all appropriate jurisdictions;

         (c)      cause the Partnership to carry Insurance from an Insurance
Company;

         (d) have a fiduciary  responsibility for the safekeeping and use of all
funds and assets of the Partnership,  whether or not in its immediate possession
or control  and not employ or permit  another to employ  such funds or assets in
any manner except for the benefit of the Partnership;

         (e) use its best  efforts so that all  requirements  shall be met which
are reasonably  necessary to obtain or achieve (1)  compliance  with the Minimum
Set-Aside Test, the Rent Restriction Test, and any other requirements  necessary
for the Apartment Housing to initially qualify,  and to continue to qualify, for
LIHTC and Section 8 project  based  assistance;  (2)  issuance of all  necessary
certificates  of occupancy,  including all  governmental  approvals  required to
permit  occupancy of all of the apartment  units in the Apartment  Housing;  (3)
compliance  with all  provisions of the Project  Documents and (4) a reservation
and allocation of LIHTC from the State Tax Credit Agency;

         (f) make  inspections  of the  Apartment  Housing  and assure  that the
Apartment Housing is in decent,  safe,  sanitary and good condition,  repair and
working order, ordinary use and obsolescence  excepted,  and make or cause to be
made from time to time all necessary  repairs  thereto  (including  external and
structural repairs) and renewals and replacements thereof;

         (g) pay, before the same shall become  delinquent and before  penalties
accrue thereon all Partnership taxes, assessments and other governmental charges
against the  Partnership or its  properties,  and all of its other  liabilities,
except to the extent and so long as the same are being  contested  in good faith
by appropriate  proceedings in such manners as not to cause any material adverse
effect  on  the  Partnership's   property,   financial   condition  or  business
operations, with adequate reserves provided for such payments;

                                       34
<PAGE>

         (h)  permit,  and cause the  Management  Agent to permit,  the  Special
Limited  Partner and its  representatives:  (1) to have access to the  Apartment
Housing and personnel employed by the Partnership and by the Management Agent at
all times during normal business hours after reasonable  notice;  (2) to examine
all agreements,  LIHTC compliance data and Plans and Specifications;  and (3) to
make copies thereof;

         (i) exercise  good faith in all  activities  relating to the conduct of
the  business of the  Partnership,  including  the  development,  operation  and
maintenance of the Apartment  Housing,  and shall take no action with respect to
the business and property of the Partnership which is not reasonably  related to
the achievement of the purpose of the Partnership;

         (j) make any Capital  Contributions,  advances or loans required to be
made by the General Partner under the terms of this Agreement;

         (k)  establish  and maintain all reserves  required to be  established
and maintained under the terms of this Agreement;

         (l) cause the Management Agent to manage the Apartment  Housing in such
a manner that the  Apartment  Housing  will be  eligible  to receive  LIHTC with
respect to 100% of the apartment  units in the Apartment  Housing.  To that end,
the  General  Partner  agrees,  without  limitation:  (1) to make all  elections
requested by the Special  Limited  Partner under Section 42 of the Code to allow
the  Partnership or its Partners to claim the Tax Credit;  (2) to file Form 8609
with respect to the Apartment Housing as required,  for at least the duration of
the  Compliance  Period;  (3) to operate  the  Apartment  Housing  and cause the
Management  Agent to manage  the  Apartment  Housing  so as to  comply  with the
requirements of Section 42 of the Code and Section 8 project based  assistance ,
as amended,  or any successor  thereto,  including,  but not limited to, Section
42(g) and Section 42(i)(3) of the Code, as amended,  or any successors  thereto;
(4) to make  all  certifications  required  by  Section  42(l) of the  Code,  as
amended, or any successor thereto;  and (5) to operate the Apartment Housing and
cause the Management Agent to manage the Apartment  Housing so as to comply with
all other Tax Credit Conditions and Section 8 requirements ; and

         (m) perform  such other acts as may be  expressly  required of it under
the terms of this Agreement.

     Section 9.8 Obligations to Repair and Rebuild Apartment  Housing.  With the
approval of any lender,  if such approval is required,  any  Insurance  proceeds
received  by the  Partnership  due to  fire  or  other  casualty  affecting  the
Apartment  Housing will be utilized to repair and rebuild the Apartment  Housing
in satisfaction of the conditions  contained in Section 42(j)(4) of the Code and
to the extent required by any lender.  Any such proceeds  received in respect of
such event  occurring  after the  Compliance  Period shall be so utilized or, if
permitted by the Project  Documents and with the Consent of the Special  Limited
Partner, shall be treated as Sale or Refinancing Proceeds.

                                       35
<PAGE>

     Section 9.9 Partnership Expenses.

         (a) All of the  Partnership's  expenses shall be billed directly to and
paid by the Partnership to the extent practicable. Reimbursements to the General
Partner, or any of its Affiliates,  by the Partnership shall be allowed only for
the  Partnership's  Cash Expenses unless the General Partner is obligated to pay
the same as an Operating  Deficit during the Operating Deficit Guarantee Period,
and subject to the limitations on the  reimbursement  of such expenses set forth
herein.  For purposes of this Section,  Cash Expenses shall include fees paid by
the  Partnership to the General  Partner or any Affiliate of the General Partner
permitted  by  this  Agreement  and the  actual  cost of  goods,  materials  and
administrative services used for or by the Partnership,  whether incurred by the
General Partner,  an Affiliate of the General Partner or a nonaffiliated  Person
in  performing  the  foregoing  functions.  As used in the  preceding  sentence,
"actual  cost of goods  and  materials"  means  the  actual  cost of  goods  and
materials  used for or by the  Partnership  and obtained from entities which are
not  Affiliates  of the  General  Partner,  and  actual  cost of  administrative
services means the pro rata cost of personnel (as if such persons were employees
of the Partnership)  associated therewith,  but in no event to exceed the amount
which  would be  charged  by  nonaffiliated  Persons  for  comparable  goods and
services.

         (b)  Reimbursement  to the General  Partner or any of its Affiliates of
operating  cash expenses  pursuant to Subsection  (a) hereof shall be subject to
the following:

                  (1) no such  reimbursement  shall be  permitted  for  services
for  which  the  General  Partner  or  any of  its  Affiliates  is  entitled  to
compensation by way of a separate fee; and

                  (2) no  such  reimbursement  shall  be made  for  (A)  rent or
depreciation,  utilities,  capital equipment or other such administrative items,
and (B) salaries,  fringe  benefits,  travel  expenses and other  administrative
items incurred or allocated to any  "controlling  person" of the General Partner
or any  Affiliate  of the General  Partner.  For the  purposes  of this  Section
9.9(b)(2),  "controlling  person"  includes,  but is not limited to, any Person,
however titled,  who performs functions for the General Partner or any Affiliate
of the General  Partner similar to those of: (i) chairman or member of the board
of directors;  (ii) executive management,  such as president,  vice president or
senior  vice  president,   corporate   secretary  or  treasurer;   (iii)  senior
management,  such as the vice  president  of an  operating  division who reports
directly  to  executive  management;  or (iv) those  holding  5% or more  equity
interest in such General Partner or any such Affiliate of the General Partner or
a person  having  the power to direct or cause  the  direction  of such  General
Partner or any such  Affiliate  of the  General  Partner,  whether  through  the
ownership of voting securities, by contract or otherwise.

                                       36
<PAGE>

     Section 9.10 General Partner Expenses. The General Partner or Affiliates of
the General Partner shall pay all  Partnership  expenses which are not permitted
to be reimbursed pursuant to Section 9.9 and all expenses which are unrelated to
the business of the Partnership.

     Section  9.11  Other   Business  of   Partners.   Any  Partner  may  engage
independently or with others in other business  ventures wholly unrelated to the
Partnership  business  of  every  nature  and  description,  including,  without
limitation, the acquisition, development, construction, operation and management
of real estate projects and developments of every type on their own behalf or on
behalf of other  partnerships,  joint  ventures,  corporations or other business
ventures  formed  by them or in  which  they may  have an  interest,  including,
without  limitation,  business  ventures  similar to, related to or in direct or
indirect competition with the Apartment Housing. Neither the Partnership nor any
Partner  shall  have any right by virtue of this  Agreement  or the  partnership
relationship created hereby in or to such other ventures or activities or to the
income or  proceeds  derived  therefrom.  Conversely,  no Person  shall have any
rights to  Partnership  assets,  incomes  or  proceeds  by virtue of such  other
ventures or activities of any Partner.

     Section 9.12 Covenants, Representations and Warranties. The General Partner
covenants,  represents and warrants that the following are presently  true, will
be true at the time of each  Capital  Contribution  payment  made by the Limited
Partner and will be true during the term of this  Agreement,  to the extent then
applicable.

         (a) The  Partnership is a duly organized  limited  partnership  validly
existing  under  the  laws  of the  State  and  has  complied  with  all  filing
requirements  necessary  for the  protection  of the  limited  liability  of the
Limited Partner and the Special Limited Partner.

         (b) The  Partnership  Agreement  and the Project  Documents are in full
force and effect and neither  the  Partnership  nor the  General  Partner are in
breach or violation of any provisions thereof.

         (c) Improvements will be completed in a timely and workerlike manner in
accordance  with all applicable  requirements  of all  appropriate  governmental
entities and the Plans and Specifications of the Apartment Housing.

         (d)  The  Apartment  Housing  is  being  operated  in  accordance  with
standards  and  procedures  which are prudent and customary for the operation of
properties similar to the Apartment Housing.

         (e)  All conditions to the funding of the Construction  and  Renovation
Loan have been met.

                                       37
<PAGE>

         (f) No Partner has or will have any personal  liability with respect to
or has or will have personally guaranteed the payment of the Mortgage.

         (g) The  Partnership  is in compliance  with all  construction  and use
codes applicable to the Apartment Housing and is not in violation of any zoning,
environmental or similar regulations applicable to the Apartment Housing.

         (h) All  appropriate  public  utilities,  including  sanitary and storm
sewers,  water,  gas  and  electricity,  are  currently  available  and  will be
operating  properly for all units in the Apartment  Housing at the time of first
occupancy and throughout the term of the Partnership.

         (i) All roads  necessary for the full  utilization of the  Improvements
have been completed and the necessary  rights of way have been acquired and will
be maintained by the Partnership.

         (j)  The Partnership has obtained Insurance  written  by  an  Insurance
Company.

         (k)  The Partnership owns the  fee simple  interest  in  the  Apartment
Housing.

         (l) The  Construction  and  Renovation  Contract  has been entered into
between the Partnership and the Contractor;  no other consideration or fee shall
be paid to the Contractor  other than amounts set forth in the  Construction and
Renovation  Contract,  unless  authorized  in  writing  by the  Special  Limited
Partner.

         (m) The General  Partner  will  require the  Accountant  to  depreciate
Partnership   items  in  accordance   with  Exhibit  "G"  attached   hereto  and
incorporated herein by this reference.

         (n) To the best of the General  Partner's  knowledge:  (1) no Hazardous
Substance  has been disposed of, or released to or from, or otherwise now exists
in,  on,  under or around,  the  Apartment  Housing  and (2) no  aboveground  or
underground  storage  tanks are now or have ever  been  located  on or under the
Apartment Housing. The General Partner will not install or allow to be installed
any  aboveground  or  underground  storage tanks on the Apartment  Housing.  The
General  Partner  covenants  that the  Apartment  Housing  shall be kept free of
Hazardous  Substance  and shall not be used to  generate,  manufacture,  refine,
transport,  treat,  store,  handle,  dispose  of,  transfer,  produce or process
Hazardous  Substance,  except in  connection  with the  normal  maintenance  and
operation of any portion of the  Apartment  Housing.  The General  Partner shall
comply, or cause there to be compliance,  with all applicable Federal, state and

                                       38
<PAGE>

local  laws,  ordinances,  rules  and  regulations  with  respect  to  Hazardous
Substance  and shall keep, or cause to be kept,  the Apartment  Housing free and
clear  of any  liens  imposed  pursuant  to such  laws,  ordinances,  rules  and
regulations.  The General  Partner must promptly  notify the Limited Partner and
the Special  Limited Partner in writing (3) if it knows, or suspects or believes
there may be any  Hazardous  Substance  in or around  any part of the  Apartment
Housing,  any Improvements  constructed on the Apartment  Housing,  or the soil,
groundwater or soil vapor,  (4) if the General Partner or the Partnership may be
subject to any threatened or pending  investigation by any  governmental  agency
under any law,  regulation or ordinance  pertaining to any Hazardous  Substance,
and (5) of any claim made or threatened by any Person, other than a governmental
agency,  against the  Partnership or General Partner arising out of or resulting
from any Hazardous Substance being present or released in, on or around any part
of the Apartment Housing.

         (o) The  General  Partner  has not  executed  and will not  execute any
agreements with provisions contradictory to, or in opposition to, the provisions
of this Agreement, except as may be required by the project's HAP Contract.

         (p)  The Partnership will allocate to the Limited Partner the Projected
Annual Tax Credits,  or the Revised  Projected Tax Credits, if applicable.

         (q) No  charges,  liens  or  encumbrances  exist  with  respect  to the
Apartment Housing other than those which are created or permitted by the Project
Documents,  HAP  Contract  or  Mortgage  or are noted or  excepted  in the Title
Policy.

         (r) The  buildings on the  Apartment  Housing site  constitute or shall
constitute a "qualified  low-income housing project" as defined in Section 42(g)
of the Code, and as amplified by the Treasury  Regulations  thereunder.  In this
connection,  not later than  December 31 of the first year in which the Partners
elect the LIHTC to commence in accordance  with the Code, the Apartment  Housing
will satisfy the Minimum Set-Aside Test.

         (s) All accounts of the Partnership required to be maintained under the
terms  of the  Project  Documents,  subject  to the  terms  of the HAP  Contract
including,  without  limitation,  any reserves in  accordance  with Article VIII
hereof,  are currently funded to required  levels,  including levels required by
any authority.

         (t) The General  Partner has lent or  otherwise  advanced  funds to the
Partnership other than its Capital  Contribution,  or Operating Deficit Loan, if
applicable,  and the  Partnership  has no  unsatisfied  obligation  to make  any
payments of any kind to the General Partner or any Affiliate thereof.

         (u)  No event has occurred which constitutes a default under any of the
Project Documents.

         (v) No event has occurred which has caused, and the General Partner has
not acted in any manner which will cause (1) the  Partnership  to be treated for
federal income tax purposes as an association taxable as a corporation,  (2) the

                                       39
<PAGE>

Partnership  to fail to qualify as a limited  partnership  under the Act, or (3)
the Limited Partner to be liable for Partnership obligations;  provided however,
the General Partner shall not be in breach of this  representation if the action
causing  the Limited  Partner to be liable for the  Partnership  obligations  is
undertaken by the Limited Partner.

         (w) No event or  proceeding,  including,  but not limited to, any legal
actions or  proceedings  before any court,  commission,  administrative  body or
other  governmental  authority,  and acts of any  governmental  authority having
jurisdiction  over  the  zoning  or land use laws  applicable  to the  Apartment
Housing,  has occurred the  continuing  effect of which has: (1)  materially  or
adversely  affected the operation of the  Partnership or the Apartment  Housing;
(2)  materially  or  adversely  affected  the ability of the General  Partner to
perform its  obligations  hereunder or under any other agreement with respect to
the  Apartment  Housing;  or (3) prevented the  completion of  construction  and
renovation  of the  Improvements  in  substantial  conformity  with the  Project
Documents, other than legal proceedings which have been bonded against (or as to
which  other  adequate  financial  security  has been  issued) in a manner as to
indemnify the Partnership against loss;  provided,  however,  the foregoing does
not apply to matters of general  applicability  which would adversely affect the
Partnership,  the General  Partner,  Affiliates  of the  General  Partner or the
Apartment  Housing  only  insofar as they or any of them are part of the general
public.

         (x)  Neither  the   Partnership   nor  the  General   Partner  has  any
liabilities,  contingent or otherwise,  which have not been disclosed in writing
to the  Limited  Partner  and the  Special  Limited  Partner  and  which  in the
aggregate  affect the ability of the Limited  Partner to obtain the  anticipated
benefits of its investment in the Partnership.

         (y) Upon signing of the Loan and receipt of the Lender's  written start
order,  the  General  Partner  will cause  construction  and  renovation  of the
Improvements  to commence and thereafter will cause the Contractor to diligently
proceed with  construction and renovation of the  Improvements  according to the
Plans  and  Specifications  so that the  Improvements  can be  completed  by the
Completion Date.

         (z) The  General  Partner  or  Guarantor  has and shall use their  best
efforts  to  maintain  a net  worth  equal to at least  $1,000,000  computed  in
accordance with generally accepted  accounting  principles.  This Section is not
applicable to the General Partner, Sioux Falls Environmental Access, Inc.

         (aa) The General Partner agrees to Refinance the Mortgage by the sooner
of the following:

                  (1) the fourth anniversary of the funding  of the Mortgage; or

                                       40
<PAGE>

                  (2) within 120 days after the five year  treasury  note ("Five
                      Year  Treasury  Note") as  published  in the  Wall  Street
                      Journal ("WSJ") is equal to or exceeds 8%.

         (bb)  Notwithstanding the foregoing,  if the Five Year Treasury Note is
equal to or less than 7% at any time prior to a Refinance of the  Mortgage,  the
General Partner has the authority to Refinance the Mortgage  without the consent
of the Special Limited Partner,  provided the subsequent  mortgage  ("Refinanced
Mortgage") has a fixed rate of interest and maintains a Debt Service Coverage of
1.15 as defined in Section 1.24 of this Agreement.

         The  General  Partner  shall be liable to the  Limited  Partner for any
costs,  damages,  loss of profits,  diminution in the value of its investment in
the Partnership, or other losses, of every nature and kind whatsoever, direct or
indirect,  realized  or  incurred  by the  Limited  Partner  as a result  of any
material breach of the  representations and warranties set forth in this Section
9.12.

                                    ARTICLE X

                    ALLOCATIONS OF INCOME, LOSSES AND CREDITS

     Section 10.1 General.  All items includable in the calculation of Income or
Loss not  arising  from a Sale or  Refinancing,  and all Tax  Credits,  shall be
allocated  99.98% to the Limited  Partner,  0.01% to the Special Limited Partner
and 0.01% to the General Partner.

     Section 10.2  Allocations  From Sale or Refinancing.  All Income and Losses
arising from a Sale or  Refinancing  shall be allocated  between the Partners as
follows:

         (a)  As to Income:

                  (1) first, an amount of Income equal to the aggregate negative
balances  (if any) in the  Capital  Accounts  of all  Partners  having  negative
Capital  Accounts  (prior to taking into account the Sale or Refinancing and the
Distribution  of the related  Sale or  Refinancing  Proceeds,  but after  giving
effect to  Distributions of Net Operating Income and allocations of other Income
and Losses pursuant to this Article X up to the date of the Sale or Refinancing)
shall be allocated to such  Partners in  proportion  to their  negative  Capital
Account balances until all such Capital Accounts shall have zero balances; and

                  (2) the balance,  if any, of such Income shall be allocated to
the Partners in the  proportion  necessary so that the Partners will receive the
amount to which they are entitled pursuant to Section 11.2 hereof.

                                       41
<PAGE>

         (b) Losses shall be allocated 99.98% to the Limited  Partner,  0.01% to
the Special Limited Partner and 0.01% to the General Partner.

         (c)  Notwithstanding  the foregoing  provisions of Section  10.2(a) and
(b), in no event  shall any Losses be  allocated  to the Limited  Partner or the
Special Limited  Partner if and to the extent that such allocation  would create
or increase an Adjusted  Capital  Account Deficit for the Limited Partner or the
Special Limited  Partner.  In the event an allocation of 99.98% or 0.01% of each
item  includable in the calculation of Income or Loss not arising from a Sale or
Refinancing,  would create or increase an Adjusted  Capital  Account Deficit for
the Limited Partner or the Special Limited Partner,  respectively,  then so much
of the items of deduction other than projected  depreciation  shall be allocated
to the General  Partner  instead of the Limited  Partner or the Special  Limited
Partner as is  necessary  to allow the Limited  Partner or the  Special  Limited
Partner to be allocated 99.98% and 0.01%,  respectively,  of the items of Income
and Apartment  Housing  depreciation  without creating or increasing an Adjusted
Capital Account Deficit for the Limited Partner or the Special Limited  Partner,
it being the intent of the  parties  that the  Limited  Partner  and the Special
Limited Partner always shall be allocated 99.98% and 0.01%, respectively, of the
items of Income not  arising  from a Sale or  Refinancing  and 99.98% and 0.01%,
respectively, of the Apartment Housing depreciation.

     Section 10.3 Special  Allocations.  The following special allocations shall
be made in the following order.

         (a) Except as otherwise  provided in Section 1.704-2(f) of the Treasury
Regulations, notwithstanding any other provisions of this Article X, if there is
a net decrease in Partnership  Minimum Gain during any Partnership  fiscal year,
each Partner shall be specially  allocated items of Partnership  income and gain
for such fiscal year (and, if necessary,  subsequent  fiscal years) in an amount
equal to such Person's  share of the net decrease in  Partnership  Minimum Gain,
determined  in  accordance  with  Treasury   Regulations   Section   1.704-2(g).
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 Section
1.704-2(f)(6)  and  1.704-2(j)(2)  of the  Treasury  Regulations.  This  Section
10.3(a) is intended to comply with the minimum gain  chargeback  requirement  in
Section  1.704-2(f)  of  the  Treasury  Regulations  and  shall  be  interpreted
consistently therewith.

         (b)  Except as  otherwise  provided  in  Section  1.704-2(i)(4)  of the
Treasury Regulations,  notwithstanding any other provision of this Article X, if
there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to
a Partner  Nonrecourse Debt during any Partnership  fiscal year, each Person who
has a share of the Partner  Nonrecourse  Debt Minimum Gain  attributable to such
Partner Nonrecourse Debt, determined in accordance with Section 1.704-2(i)(5) of
the Treasury  Regulations,  shall be specially  allocated  items of  Partnership

                                       42
<PAGE>

income and gain for such  fiscal  year (and,  if  necessary,  subsequent  fiscal
years) in an amount equal to such Person's  share of the net decrease in Partner
Nonrecourse  Debt Minimum Gain  attributable to such Partner  Nonrecourse  Debt,
determined  in  accordance  with  Treasury  Regulations  Section  1.704-2(i)(4).
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 Sections
1.704-2(i)(4)  and  1.704-2(j)(2)  of the  Treasury  Regulations.  This  Section
10.3(b) is intended to comply with the minimum gain  chargeback  requirement  in
Section  1.704-2(i)(4)  of the  Treasury  Regulations  and shall be  interpreted
consistently therewith.

         (c) In the event any Partner  unexpectedly  receives  any  adjustments,
allocations,   or  distributions   described  in  Treasury  Regulations  Section
1.704-1(b)(2)(ii)(d)(4),    Section    1.704-1(b)(2)(ii)(d)(5),    or    Section
1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be specially
allocated to each such Partner in an amount and manner  sufficient to eliminate,
to the extent required by the Treasury Regulations, the Adjusted Capital Account
Deficit of such  Partner as quickly as  possible,  provided  that an  allocation
pursuant to this  Section  10.3(c)  shall be made if and only to the extent that
such Partner  would have an Adjusted  Capital  Account  Deficit  after all other
allocations  provided for in this Section 10.3 have been  tentatively made as if
this Section 10.3(c) were not in the Agreement.

         (d) In the event any Partner has a deficit  Capital  Account at the end
of any  Partnership  fiscal year which is in excess of the sum of (i) the amount
such Partner is obligated to restore, and (ii) the amount such Partner is deemed
to be obligated  to restore  pursuant to the  penultimate  sentences of Treasury
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Partner shall be
specially  allocated items of Partnership  income and gain in the amount of such
excess as quickly as  possible,  provided  that an  allocation  pursuant to this
Section  10.3(d) shall be made if and only to the extent that such Partner would
have a deficit Capital Account in excess of such sum after all other allocations
provided for in this Section 10.3 have been  tentatively made as if this Section
10.3(d) and Section 10.3(c) hereof were not in the Agreement.

         (e)  Nonrecourse  Deductions  for any fiscal  year  shall be  specially
allocated  99.98% to the Limited  Partner,  0.01% to the Special Limited Partner
and 0.01% to the General Partner.

         (f) Any  Partner  Nonrecourse  Deductions  for any fiscal year shall be
specially  allocated  to the  Partner who bears the  economic  risk of loss with
respect  to the  Partner  Nonrecourse  Debt to which  such  Partner  Nonrecourse
Deductions are  attributable  in accordance  with Treasury  Regulations  Section
1.704-2(i)(1).

                                       43
<PAGE>

         (g) To the  extent  an  adjustment  to the  adjusted  tax  basis of any
Partnership  asset  pursuant to Code Section  734(b) or Code  Section  743(b) is
required,  pursuant to Treasury Regulations Section  1.704-1(b)(2)(iv)(m)(2)  or
Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital
Accounts as the result of a distribution to a Partner in complete liquidation of
his interest in the  Partnership,  the amount of such  adjustment to the Capital
Accounts  shall be treated as an item of gain (if the  adjustment  increases the
basis of the asset) or loss (if the  adjustment  decreases  such basis) and such
gain or loss shall be specially  allocated to the  Partners in  accordance  with
their  interests  in the  Partnership  in the event  that  Treasury  Regulations
Section  1.704-1  (b)(2)(iv)(m)(2)  applies,  or to the  Partner  to  whom  such
distribution   was  made  in  the  event  that  Treasury   Regulations   Section
1.704-1(b)(2)(iv)(m)(4) applies.

         (h) To the extent the  Partnership  has  taxable  interest  income with
respect to any  promissory  note pursuant to Section 483 or Section 1271 through
1288 of the Code:

                  (1) such  interest  income shall be specially allocated to the
Limited  Partner to whom such  promissory  note relates; and

                  (2) the amount of such interest  income shall be excluded from
the  Capital  Contributions  credited  to  such  Partner's  Capital  Account  in
connection with payments of principal with respect to such promissory note.

         (i) In the event the adjusted tax basis of any  investment  tax  credit
property  that has been placed  in  service  by  the  Partnership  is  increased
pursuant to Code Section 50(c), such increase shall be specially allocated among
the  Partners  (as an  item  in the  nature  of  income  or  gain)  in the  same
proportions as the investment tax credit that is recaptured with respect to such
property is shared among the Partners.

         (j) Any  reduction in the  adjusted tax basis (or cost) of  Partnership
investment tax credit property pursuant to Code Section 50(c) shall be specially
allocated among the Partners (as an item in the nature of expenses or losses) in
the same  proportions  as the  basis  (or cost) of such  property  is  allocated
pursuant to Treasury Regulations Section 1.46-3(f)(2)(i).

         (k) Any  income,  gain,  loss or  deduction  realized  as a  direct  or
indirect  result  of the  issuance  of an  interest  in the  Partnership  by the
Partnership  to a Partner (the  "Issuance  Items") shall be allocated  among the
Partners so that, to the extent possible, the net amount of such Issuance Items,
together with all other allocations under this Agreement to each Partner,  shall
be equal to the net amount that would have been  allocated  to each such Partner
if the Issuance Items had not been realized.

                                       44
<PAGE>

         (l)  If any  Partnership  expenditure  treated  as a  deduction  on its
federal  income  tax  return is  disallowed  as a  deduction  and  treated  as a
distribution  pursuant to Section  731(a) of the Code,  there shall be a special
allocation  of  gross  income  to the  Partner  deemed  to  have  received  such
distribution equal to the amount of such distribution.

         (m)  Interest deduction on the Partnership  indebtedness referred to in
Section 6.3 shall be allocated 100% to the General Partner.

         (n) In the event all or part of the Incentive Management Fee or the Tax
Credit  Compliance Fee is disallowed by the Internal Revenue  Service,  then any
interest or income chargeable to the Partnership for such disallowance  shall be
allocated to the General Partner.

     Section 10.4 Curative  Allocations.  The  allocations set forth in Sections
10.2(c),  10.3(a),  10.3(b),  10.3(c),  10.3(d),  10.3(e),  10.3(f), and 10.3(g)
hereof (the  "Regulatory  Allocations")  are  intended  to comply  with  certain
requirements of the Treasury Regulations. It is the intent of the Partners that,
to the extent possible,  all Regulatory  Allocations shall be offset either with
other  Regulatory  Allocations  or with  special  allocations  of other items of
Partnership  income,  gain,  loss,  or deduction  pursuant to this Section 10.4.
Therefore, notwithstanding any other provision of this Article X (other than the
Regulatory  Allocations),  with the Consent of the Special Limited Partner,  the
General  Partner shall make such offsetting  special  allocations of Partnership
income,  gain, loss, or deduction in whatever manner the General  Partner,  with
the Consent of the Special  Limited  Partner,  determines  appropriate  so that,
after such  offsetting  allocations  are made,  each Partner's  Capital  Account
balance is, to the extent  possible,  equal to the Capital  Account balance such
Partner  would  have  had if the  Regulatory  Allocations  were  not part of the
Agreement and all  Partnership  items were allocated  pursuant to Sections 10.1,
10.2(a), 10.2(b), 10.3(h), 10.3(i), 10.3(j), 10.3(k), 10.3(l), 10.3(m) and 10.5.
In exercising its authority  under this Section 10.4, the General  Partner shall
take into  account  future  Regulatory  Allocations  under  Section  10.3(a) and
10.3(b)  that,  although  not yet made,  are likely to offset  other  Regulatory
Allocations previously made under Sections 10.3(e) and 10.3(f).

     Section 10.5 Other Allocation Rules.

         (a) The  basis  (or  cost) of any  Partnership  investment  tax  credit
property  shall be allocated  among the  Partners in  accordance  with  Treasury
Regulations Section 1.46-3(f)(2)(i).  All Tax Credits (other than the investment
tax credit) shall be allocated  among the Partners in accordance with applicable
law.  Consistent  with the  foregoing,  the  Partners  intend that LIHTC will be
allocated  99.98% to the Limited  Partner,  0.01% to the Special Limited Partner
and 0.01% to the General Partner.

                                       45
<PAGE>

         (b) In the event Partnership investment tax credit property is disposed
of during any taxable  year,  profits for such taxable year (and,  to the extent
such  profits are  insufficient,  profits for  subsequent  taxable  years) in an
amount  equal to the excess,  if any, of (1) the  reduction  in the adjusted tax
basis (or cost) of such property  pursuant to Code Section  50(c),  over (2) any
increase in the  adjusted  tax basis of such  property  pursuant to Code Section
50(c) caused by the  disposition  of such  property,  shall be excluded from the
profits allocated  pursuant to Section 10.1 and Section 10.2(a) hereof and shall
instead be allocated among the Partners in proportion to their respective shares
of such excess,  determined  pursuant to Section 10.3(i) and 10.3(j) hereof.  In
the event more than one item of such property is disposed of by the Partnership,
the foregoing  sentence shall apply to such items in the order in which they are
disposed of by the  Partnership,  so the profits  equal to the entire  amount of
such  excess  with  respect  to the first  such  property  disposed  of shall be
allocated  prior to any  allocations  with  respect to the second such  property
disposed of, and so forth.

         (c) For purposes of determining the Income,  Losses, or any other items
allocable  to any  period,  Income,  Losses,  and any such other  items shall be
determined  on a daily,  monthly,  or other basis,  as determined by the General
Partner with the Consent of the Special Limited  Partner,  using any permissible
method under Code Section 706 and the Treasury Regulations thereunder.

         (d) Solely for purposes of determining a Partner's  proportionate share
of  the  "excess  nonrecourse  liabilities"  of   the  Partnership  within   the
meaning of Treasury Regulations Section  1.752-3(a)(3),  the Partners' interests
in Partnership profits are as follows:  Limited Partner: 99.98%; Special Limited
Partner: 0.01%; General Partner: 0.01%.

         (e) To the extent  permitted by Section  1.704-2(h)(3)  of the Treasury
Regulations, the General Partner shall endeavor to treat Distributions as having
been made from the proceeds of a Nonrecourse  Liability or a Partner Nonrecourse
Debt only to the extent  that such  Distributions  would  cause or  increase  an
Adjusted Capital Account Deficit for any Partner who is not a General Partner.

         (f) In the event that the deduction of all or a portion of any fee paid
or incurred out of Net Operating  Income by the  Partnership  to a Partner or an
Affiliate  of a Partner is  disallowed  for federal  income tax  purposes by the
Internal Revenue Service with respect to a taxable year of the Partnership,  the
Partnership shall then allocate to such Partner an amount of gross income of the
Partnership  for such  year  equal  to the  amount  of such fee as to which  the
deduction is disallowed.

     Section 10.6 Tax Allocations:  Code Section 704(c). In accordance with Code
Section 704(c) and the Treasury Regulations thereunder,  income, gain, loss, and
deduction  with  respect  to any  property  contributed  to the  capital  of the

                                       46
<PAGE>

Partnership shall,  solely for tax purposes,  be allocated among the Partners so
as to take account of any variation  between the adjusted basis of such property
to the  Partnership  for federal income tax purposes and its initial Gross Asset
Value (computed in accordance with Section 1.34(a) hereof).

         In the event the Gross Asset Value of any Partnership asset is adjusted
pursuant to Section  1.34(b)  hereof,  subsequent  allocations of income,  gain,
loss,  and  deduction  with  respect  to such asset  shall  take  account of any
variation  between  the  adjusted  basis of such  asset for  federal  income tax
purposes  and its Gross  Asset  Value in the same  manner as under Code  Section
704(c) and the Treasury Regulations thereunder.

         Any elections or other decisions  relating to such allocations shall be
made by the General  Partner with the Consent of the Special  Limited Partner in
any manner that reasonably reflects the purpose and intention of this Agreement.
Allocations  pursuant to this  Section  10.6 are solely for purposes of federal,
state, and local taxes and shall not affect, or in any way be taken into account
in computing,  any Person's  Capital Account or share of Income,  Losses,  other
items, or distributions pursuant to any provision of this Agreement.

     Section  10.7  Allocation  Among  Limited  Partners.  In the event that the
Interest of the Limited  Partner  hereunder is at any time held by more than one
Limited  Partner  all items  which are  specifically  allocated  to the  Limited
Partner for any month pursuant to this Article X shall be apportioned among such
Persons according to the ratio of their respective  profit-sharing  interests in
the Partnership at the last day of such month.

     Section  10.8  Allocation  Among  General  Partners.  In the event that the
Interest of the General  Partner  hereunder is at any time held by more than one
General  Partner  all items  which are  specifically  allocated  to the  General
Partner for any month pursuant to this Article X shall be apportioned among such
Persons in such  percentages as may from time to time be determined by agreement
among them without amendment to this Agreement or consent of the Limited Partner
or Consent of the Special Limited Partner.

     Section 10.9 Modification of Allocations.  The provisions of Articles X and
XI and other  provisions of this  Agreement are intended to comply with Treasury
Regulations  Section  1.704 and shall be  interpreted  and  applied  in a manner
consistent with such section of the Treasury Regulations.  In the event that the
General Partner determines, in its sole discretion, that it is prudent to modify
the manner in which the Capital Accounts of the Partners, or any debit or credit
thereto,  are  computed  in order to comply  with such  section of the  Treasury
Regulations,  the General Partner may make such modification,  but only with the
Consent of the Special  Limited  Partner,  to the minimum extent  necessary,  to

                                       47
<PAGE>

effect the plan of allocations and Distributions  provided for elsewhere in this
Agreement.   Further,   the   General   Partner   shall  make  any   appropriate
modifications,  but only with the Consent of the Special Limited Partner, in the
event it appears that unanticipated events (e.g., the existence of a Partnership
election  pursuant to Code Section 754) might otherwise cause this Agreement not
to comply with Treasury Regulation Section 1.704.

                                   ARTICLE XI

                                  DISTRIBUTION

         Section 11.1 Distribution of Net Operating Income.  Except as otherwise
provided and subject to the terms of the HAP Contract,  Net Operating Income for
each fiscal year shall be distributed  within  seventy-five  (75) days following
each calendar year and shall be applied in the following order of priority:

         (a) to pay the Deferred Management Fee, if any;

         (b) to pay the current  Reporting  Fee and then to pay any accrued
Reporting  Fees which have not been paid in full from previous years;

         (c) to pay the Development Fee;

         (d) to pay the Operating Loans, if any, as referenced in Section 6.3 of
this  Agreement,  limited to 50% of the Net  Operating  Income  remaining  after
reduction for the payments made pursuant to subsections  (a) through (c) of this
Section 11.1;

         (e) to pay the Incentive Management Fee;

         (f) to pay the Tax Credit Compliance Fee; and

         (g) the balance, 30% to the Limited Partner and 70% to the General
Partner.

     Section  11.2  Distribution  of  Sale  or  Refinancing  Proceeds.  Sale  or
Refinancing Proceeds shall be distributed in the following order, subject to any
restrictions per the Project's HAP Contract:

         (a)  to the  payment  of the  Mortgage  and  other  matured  debts  and
liabilities  of the  Partnership,  other than accrued  payments,  debts or other
liabilities owing to Partners or former Partners;

         (b) to any accrued  payments,  debts or other  liabilities owing to the
Partners or former Partners,  including,  but not limited to, accrued  Reporting
Fees and Operating Loans, to be paid prorata if necessary;

         (c) to the General Partner a sales preparation fee in the amount of 5%;

         (d) to the  establishment  of any reserves  which the General  Partner,
with the Consent of the Special Limited Partner, shall deem reasonably necessary

                                       48
<PAGE>

for  contingent,  unmatured or  unforeseen  liabilities  or  obligations  of the
Partnership;

         (e) to the Limited Partner in an amount equal to its Capital
Contribution;

         (f) to the Special Limited Partner in an amount equal to its Capital
Contribution;

         (g) to the General Partner in an amount equal to its Capital
Contribution; and

         (h) thereafter, 30% to the Limited Partner and 70% to the General
Partner.

                                   ARTICLE XII

                              TRANSFERS OF LIMITED
                      PARTNER'S INTEREST IN THE PARTNERSHIP

     Section 12.1 Assignment of Interests.  Upon  satisfaction of the following,
the  Limited  Partner and the Special  Limited  Partner  shall have the right to
assign  all or any part of  their  respective  Interests  to any  other  Person,
whether  or  not  a  Partner,   subject  to  compliance   with  HUD's   Previous
Participation requirements as applicable and upon satisfaction of the following:

         (a) a written  instrument  setting  forth the name and  address  of the
proposed transferee,  the nature and extent of the Interest which is proposed to
be transferred  and the terms and conditions upon which the transfer is proposed
to be made,  stating that the Assignee  accepts and agrees to be bound by all of
the terms and provisions of this Agreement, and providing for the payment of all
reasonable  expenses  incurred  by  the  Partnership  in  connection  with  such
assignment,  including  but not limited to the cost of preparing  any  necessary
amendment to this Agreement; and

         (b) upon  receipt  by the  General  Partner of the  Assignee's  written
representation  that the Partnership  Interest is to be acquired by the Assignee
for the  Assignee's  own account for  long-term  investment  and not with a view
toward resale, fractionalization, division or distribution thereof.

         (c) Notwithstanding any provision to the contrary,  the Limited Partner
may assign its  Interest to an Affiliate or assign its Interest to USbank or its
successors  as  collateral  to  secure  a  capital   contribution  loan  without
satisfying the conditions of Sections 12.1(a) and (b) above.

         THE LIMITED PARTNER  INTEREST AND THE SPECIAL LIMITED PARTNER  INTEREST
DESCRIBED  HEREIN HAVE NOT BEEN  REGISTERED  UNDER THE SECURITIES ACT OF 1933 AS

                                       49
<PAGE>

AMENDED OR UNDER ANY STATE  SECURITIES  LAW. THESE  INTERESTS MAY NOT BE SOLD OR
OTHERWISE  TRANSFERRED  UNLESS  REGISTERED  UNDER  APPLICABLE  FEDERAL AND STATE
SECURITIES LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

     Section  12.2  Effective  Date of  Transfer.  Any  assignment  of a Limited
Partner's  Interest or Special Limited  Partner's  Interest  pursuant to Section
12.1 shall become  effective as of the first day of the calendar  month in which
the last of the conditions to such assignment are satisfied.

     Section 12.3 Invalid Assignment. Any purported assignment of an Interest of
the Limited Partner or the Special Limited Partner  otherwise than in accordance
with  Section  12.1 or  Section  12.6  shall  be of no  effect  as  between  the
Partnership  and the purported  assignee and shall be disregarded by the General
Partner in making allocations and Distributions hereunder.

     Section  12.4  Assignee's  Rights  to  Allocations  and  Distributions.  An
Assignee shall be entitled to receive  allocations  and  Distributions  from the
Partnership  attributable  to the Interest  acquired by reason of any  permitted
assignment  from the  effective  date of transfer as  determined in Section 12.2
above.  The  Partnership  and the General Partner shall be entitled to treat the
assignor of such  Partnership  Interest  as the  absolute  owner  thereof in all
respects, and shall incur no liability for allocations and Distributions made in
good  faith to such  assignor,  until  such time as the  written  instrument  of
assignment has been received by the Partnership.

     Section 12.5 Substitution of Assignee as Limited Partner or Special Limited
Partner.

         (a) An Assignee shall not have the right to become a Substitute Limited
Partner or Substitute  Special  Limited  Partner in place of his assignor unless
the written consent of the General Partner to such substitution  shall have been
obtained,  which consent, in the General Partner's absolute  discretion,  may be
withheld;  except that an Assignee which is an Affiliate of the Limited  Partner
or Special Limited Partner, or USbank or its successors, may become a Substitute
Limited Partner or Substitute Special Limited Partner without the consent of the
General Partner.

         (b) A nonadmitted  transferee of the Limited Partner's  Interest or the
Special Limited Partner's  Interest in the Partnership shall only be entitled to
receive  that  share of  allocations,  Distributions  and the  return of Capital
Contribution  to which its  transferor  would  otherwise have been entitled with
respect  to the  Interest  transferred,  and shall  have no right to obtain  any
information  on  account  of the  Partnership's  transactions,  to  inspect  the
Partnership's  books and records or have any other of the rights and  privileges

                                       50
<PAGE>

of a Limited Partner or Special Limited  Partner,  provided,  however,  that the
Partnership  shall,  if a transferee and  transferor  jointly advise the General
Partner in writing of a transfer of an Interest in the Partnership,  furnish the
transferee  with pertinent tax information at the end of each fiscal year of the
Partnership.

     Section 12.6 Death,  Bankruptcy,  Incompetency,  etc. of a Limited Partner.
Upon the death,  dissolution,  adjudication  of bankruptcy,  or  adjudication of
incompetency or insanity of the Limited Partner or Special Limited Partner, such
Partner's executors,  administrators or legal representatives shall have all the
rights of its  predecessor-in-interest  for the  purpose of settling or managing
such  Partner's  estate,  including  such  power as such  Partner  possessed  to
constitute a successor as a transferee of its Interest in the Partnership and to
join  with  such  transferee  in  making  the  application  to  substitute  such
transferee as a Partner.

                                  ARTICLE XIII

                     WITHDRAWAL, REMOVAL AND REPLACEMENT OF
                                 GENERAL PARTNER

     Section 13.1 Withdrawal of General Partner.

         (a) The General  Partner may not Withdraw (other than as a result of an
Involuntary  Withdrawal)  without the Consent of the  Special  Limited  Partner.
Withdrawal  shall be  conditioned  upon the  agreement  of the  Special  Limited
Partner to be admitted as a successor General Partner, or if the Special Limited
Partner  declines  to be admitted as a  successor  General  Partner  then on the
agreement of one or more Persons who satisfy the requirements of Section 13.5 of
this  Agreement to be admitted as successor  General  Partner(s).  A new General
Partner may not be admitted until the partnership has received the prior written
consent of HUD.

         (b) Each Guarantor  shall  indemnify and hold harmless the  Partnership
and all Partners  from its  Withdrawal in violation of Section  13.1(a)  hereof.
Each Guarantor shall be liable for damages to the Partnership resulting from its
Withdrawal in violation of Section  13.1(a).  The  provisions of this Section do
not apply to the General Partner, Sioux Falls Environmental Access, Inc.

     Section 13.2 Removal of General Partner.

         (a) The  Special  Limited  Partner or the Limited  Partner,  or both of
them,  may remove the General  Partner for cause if such  General  Partner,  its
officers or directors, if applicable, has:

                  (1) been subject to Bankruptcy, unless such act has been fully
disclosed  and said  General  Partner is in  compliance  with any Court  ordered
Bankruptcy agreement;

                                       51
<PAGE>

                  (2) committed  any  fraud,  willful  misconduct,  breach of
fiduciary  duty or other  negligent  conduct in the performance of its duties
under this Agreement;

                  (3) been convicted of, or entered into a plea of guilty to, a
felony;

                  (4) been  debarred from participating in any federal or state
housing program;

                  (5) made personal use of Partnership funds or properties;

                  (6) violated  the  terms of the  Mortgage  and such  violation
prompts Security National Bank to issue a default letter or acceleration  notice
to the Partnership or General Partner;

                  (7) failed to provide any loan, advance,  Capital Contribution
or any other  payment to the  Partnership,  the  Limited  Partner or the Special
Limited Partner required under this Agreement;

                  (8) breached any representation, warranty or covenant
contained in this Agreement;

                  (9) caused the  Projected  Tax Credits to be  allocated to the
Partners for a term longer than the Tax Credit Period  unless the  provisions of
Section 7.4(e) of this Agreement apply;

                  (10) failed to  provide,  or to cause to be  provided,  the
construction  and  renovation  monitoring  documents required in Section 14.3(a)
of this Agreement;

                  (11) violated any federal or state tax law which causes a
recapture of LIHTC;

                  (12)  violated the terms of the  Construction  Loan and such
violation  prompts Security  National Bank to issue a default letter or
acceleration  notice to the Partnership or General Partner;

                  (13) allowed the construction and renovation budget to be
out-of-balance;

                  (14) failed to obtain the consent of a Partner where such
consent is required pursuant to this Agreement;

                  (15) failed to place the Apartment Housing in service by
December 15, 2000;

                  (16) failed to achieve 90% occupancy of the Apartment Housing
by January 01, 2001;

                                       52
<PAGE>

                  (17) failed to obtain Permanent Mortgage Commencement by
January 01, 2001; or

                  (18) failed during any consecutive six-month period during the
Compliance  Period  to rent  85% or more of the  total  apartment  units  in the
Apartment Housing to Qualified Tenants; notwithstanding,  if such failure is the
result of Force  Majeure or if such  failure is cured  within 120 days after the
end of the six-month period, then this removal provision shall not apply.

         (b) Written  notice of the  removal  for cause of the  General  Partner
("Removal  Notice")  shall set forth the reasons for removal and shall be served
by the Special Limited Partner or the Limited Partner, or both of them, upon the
General Partner in accordance  with Section 17.3 of this  Agreement.  If Section
13.2(a)(2),  (6), (7), (8), (12) or (13) is the basis for the removal for cause,
then the General  Partner  shall have  thirty  days from  receipt of the Removal
Notice  in which to cure the  removal  condition;  except  that in regard to the
Mortgage  Loan the cure  period  shall be the sooner of thirty  days or ten days
prior to the expiration of the cure period referenced in the loan documents,  if
any. If the  condition  for the removal for cause is not cured within the thirty
day cure period then the General  Partner's  removal shall become effective upon
approval of a majority of the  Partner's  Interest (as specified in Section 10.1
of this  Agreement) at a Partner's  meeting held in accordance with Section 17.2
of this  Agreement.  If the removal for cause is for a condition  referenced  in
Sections  13.2(a)(1),  (3), (4), (5), (9), (10), (11), (14), (15), (16), (17) or
(18) then the removal shall become  effective upon approval of a majority of the
Partner's  Interest  (as  specified  in  Section  10.1 of this  Agreement)  at a
Partner's  meeting held in accordance with Section 17.2 of this Agreement.  Upon
the General Partner's removal,  the General Partner shall deliver to the Special
Limited  Partner within five business days of the Partner's  meeting  confirming
the General  Partner's  removal all Partnership  books and records including all
bank  signature  cards and an  authorization  to  change  the  signature  on the
signature cards from the General Partner to the Special  Limited  Partner,  or a
successor  general partner so nominated by the Limited Partner,  Special Limited
Partner and approved by HUD. The Partner's recognize and acknowledge that if the
General  Partner  fails to provide the  Partnership  books and records  upon the
General  Partner's  removal then the remaining  Partners may suffer  irreparable
injury.  Therefore,  in the event the  General  Partner  does not  adhere to the
provisions of this Section 13.2(b),  and in addition to other rights or remedies
which may be provided by law and equity or this  Agreement,  the Limited Partner
and/or Special Limited  Partner shall have the right to specific  performance to
compel the General Partner to perform its obligation  under this Section and the
Limited Partner and/or Special Limited Partner may bring such action,  and other
actions to enforce the removal, by way of temporary and/or permanent  injunctive
relief.

     Section 13.3 Effects of a  Withdrawal.  In the event of a  Withdrawal,  the
entire  Interest  of the  Withdrawing  General  Partner  shall  immediately  and

                                       53
<PAGE>

automatically  terminate  on the  effective  date of such  Withdrawal,  and such
General Partner shall immediately  cease to be a General Partner,  shall have no
further right to participate  in the management or operation of the  Partnership
or the Apartment Housing or to receive any allocations or Distributions from the
Partnership  or any  other  funds  or  assets  of  the  Partnership,  except  as
specifically set forth below. In the event of a Withdrawal, any or all executory
contracts,  including but not limited to the Management  Agreement,  between the
Partnership  and  the  Withdrawing  General  Partner  or its  Affiliates  may be
terminated by the Partnership,  with the Consent of the Special Limited Partner,
upon written  notice to the party so  terminated.  Furthermore,  notwithstanding
such  Withdrawal,  the  Withdrawing  General  Partner shall be and shall remain,
liable as a General Partner for all liabilities and obligations  incurred by the
Partnership  or by the  General  Partner  prior  to the  effective  date  of the
Withdrawal, or which may arise upon such Withdrawal. Any remaining Partner shall
have all other rights and remedies  against the  Withdrawing  General Partner as
provided by law or under this Agreement.  The General Partner agrees that in the
event of its Withdrawal it will  indemnify and hold the Limited  Partner and the
Special Limited Partner harmless from and against all losses, costs and expenses
incurred in connection with the Withdrawal,  including,  without limitation, all
legal fees and other  expenses  of the Limited  Partner and the Special  Limited
Partner in connection with the transaction.  The following additional provisions
shall apply in the event of a  Withdrawal.  The  provisions  of this  Section or
subsequent   Section  do  not  apply  to  the  General   Partner,   Sioux  Falls
Environmental Access, Inc.

         (a)  In  the  event  of  a  Withdrawal  which  is  not  an  Involuntary
Withdrawal,  or is not an  Involuntary  Withdrawal  in  accordance  with Section
13.2(a),  the Withdrawing General Partner shall have no further right to receive
any future  allocations or Distributions from the Partnership or any other funds
or assets of the Partnership,  nor shall it be entitled to receive or to be paid
by the Partnership any further  payments of fees (including fees which have been
earned but are unpaid) or to be repaid any outstanding advances or loans made by
it to the Partnership or to be paid any amount for its former Interest. From and
after  the  effective  date  of  such  Withdrawal,  the  former  rights  of  the
Withdrawing  General  Partner  to  receive  or  to  be  paid  such  allocations,
Distributions,  funds, assets, fees or repayments shall be assigned to the other
General  Partner or General  Partners  (which may include  the  Special  Limited
Partner),  or if there is no other general  partner of the  Partnership  at that
time, to the Special Limited Partner.

         (b) In the event of an  Involuntary  Withdrawal,  except as provided in
Section  13.3(c) below,  the  Withdrawing  General Partner shall have no further
right to receive any future allocations or Distributions from the Partnership or
any other funds or assets of the Partnership,  provided that accrued and payable
fees  (i.e.,  fees earned but unpaid as of the date of  Withdrawal)  owed to the

                                       54
<PAGE>

Withdrawing  General  Partner,  and any  outstanding  loans  of the  Withdrawing
General Partner to the  Partnership,  shall be paid to the  Withdrawing  General
Partner in the manner and at the times such fees and loans  would have been paid
had the Withdrawing  General Partner not Withdrawn.  The Interest of the General
Partner shall be purchased as follows.

                  (1) If the Involuntary  Withdrawal does not arise from removal
for  cause  under  Section  13.2(a)  hereof,  and  if the  Partnership  is to be
continued  with one or more  remaining  or  successor  General  Partner(s),  the
Partnership,  with the Consent of the Special Limited  Partner,  may, but is not
obligated to,  purchase the Interest of the  Withdrawing  General  Partner.  The
purchase  price of such Interest shall be its Fair Market Value as determined by
agreement  between the  Withdrawing  General  Partner  and the  Special  Limited
Partner,  or, if they cannot agree,  by arbitration in accordance  with the then
current  rules  of the  American  Arbitration  Association.  The  cost  of  such
arbitration  shall be borne equally by the  Withdrawing  General Partner and the
Partnership.  The purchase price shall be paid by the  Partnership by delivering
to the General  Partner or its  representative  the  Partnership's  non-interest
bearing  unsecured  promissory note payable,  if at all, upon liquidation of the
Partnership in accordance with Section 11.2(b). The note shall also provide that
the Partnership may prepay all or any part thereof without penalty.

                  (2) If the Involuntary  Withdrawal does not arise from removal
for  cause  under  Section  13.2(a)  hereof,  and  if the  Partnership  is to be
continued with one or more remaining or successor General Partner(s), and if the
Partnership does not purchase the Interest of the Withdrawing General Partner in
Partnership allocations, Distributions and capital, then the Withdrawing General
Partner shall retain its Interest in such items, but such Interest shall be held
as a special limited partner.

         (c)   Notwithstanding   the  provisions  of  Section  13.3(b),  if  the
Involuntary  Withdrawal  arises  from  removal for cause as set forth in Section
13.2(a)  hereof,  the Withdrawn  General  Partner shall have no further right to
receive any future  allocations  or  Distributions  from the  Partnership or any
other  funds or assets of the  Partnership,  nor shall it be entitled to receive
any payment for its Interest,  nor shall it be entitled to receive or to be paid
by the Partnership or any Partners or successor  partners,  any further payments
of fees  (including  fees  which have been  earned  but remain  unpaid) or to be
repaid any outstanding advances or loans made by it to the Partnership.

         Section 13.4 Successor General Partner. Upon the occurrence of an event
giving rise to a Withdrawal of a General Partner, any remaining General Partner,
or, if there be no remaining General Partner, the Withdrawing General Partner or
its legal  representative,  shall promptly notify the Special Limited Partner of
such Withdrawal (the "Withdrawal Notice").  Whether or not the Withdrawal Notice
shall have been sent as provided herein,  the Special Limited Partner shall have
the right to become a successor  General  Partner  (and to become the  successor

                                       55
<PAGE>

managing  General Partner if the Withdrawing  General Partner was previously the
managing General Partner.  In order to effectuate the provisions of this Section
13.4 and the continuance of the Partnership, the Withdrawal of a General Partner
shall not be effective  until the  expiration of 120 days from the date on which
occurred the event  giving rise to the  Withdrawal,  unless the Special  Limited
Partner  shall have  elected to become a successor  General  Partner as provided
herein prior to expiration of such 120-day  period,  whereupon the Withdrawal of
the General Partner shall be deemed  effective upon the  notification of all the
other Partners by the Special  Limited  Partner of such election.  However,  the
appointment  of any  Successor  General  Partner is  subject to the  partnership
receiving the prior written consent of HUD

         Section 13.5 Admission of Additional or Successor  General Partner.  No
Person shall be admitted as an additional or successor  General  Partner  unless
(a) such  Person  shall  have  agreed to become a General  Partner  by a written
instrument  which shall include the acceptance  and adoption of this  Agreement;
(b) the Consent of the Special  Limited  Partner to the admission of such Person
as a substitute General Partner, which consent may be withheld in the discretion
of the  Special  Limited  Partner;  (c) such  Person  shall  have  executed  and
acknowledged  any other  instruments  which the Special  Limited  Partner  shall
reasonably  deem necessary or appropriate to affect the admission of such Person
as a substitute  General  Partner and (d) the partnership has received the prior
written  consent  of  HUD.  If the  foregoing  conditions  are  satisfied,  this
Agreement shall be amended in accordance with the provisions of the Act, and all
other  steps  shall be taken  which  are  reasonably  necessary  to  effect  the
Withdrawal  of the  Withdrawing  General  Partner  and the  substitution  of the
successor  General  Partner.  Nothing  contained herein shall reduce the Limited
Partner's Interest or the Special Limited Partner's Interest in the Partnership.

         Section 13.6 Transfer of Interest. Except as otherwise provided herein,
the General  Partner may not Withdraw  from the  Partnership,  or enter into any
agreement  as the result of which any Person  shall  acquire an  Interest in the
Partnership,  without the Consent of the Special  Limited Partner and HUD, where
the interest being acquired is 25% or greater.

         Section 13.7 No Goodwill Value.  At no time during  continuation of the
Partnership shall any value ever be placed on the Partnership name, or the right
to its use, or to the goodwill  appertaining to the Partnership or its business,
either as among the Partners or for the purpose of determining  the value of any
Interest,  nor shall the legal  representatives of any Partner have any right to
claim any such  value.  In the event of a  termination  and  dissolution  of the
Partnership as provided in this Agreement, neither the Partnership name, nor the
right to its use, nor the same goodwill, if any, shall be considered as an asset
of the  Partnership,  and no  valuation  shall be put thereon for the purpose of
liquidation or distribution, or for any other purpose whatsoever.

                                       56
<PAGE>

                                   ARTICLE XIV

                          BOOKS AND ACCOUNTS, REPORTS,
                      TAX RETURNS, FISCAL YEAR AND BANKING

     Section 14.1 Books and Accounts.

         (a) The  General  Partner  shall  cause  the  Partnership  to keep  and
maintain at its principal  executive  office full and complete books and records
which shall include each of the following:

                  (1) a current list of the full name and last known business or
residence address of each Partner set forth in alphabetical  order together with
the Capital  Contribution  and the share in Income and Losses and Tax Credits of
each Partner;

                  (2) a copy of the  Certificate of Limited  Partnership and all
certificates of amendment  thereto,  together with executed copies of any powers
of attorney pursuant to which any certificate has been executed;

                  (3) copies of the Partnership's  federal,  state and local
income tax information  returns and reports,  if any,
for the six most recent taxable years;

                  (4) copies of the original of this Agreement and all
amendments thereto;

                  (5) financial statements of the Partnership for the six most
recent fiscal years;

                  (6) the Partnership's books and records for at least the
current and past three fiscal years; and

                  (7) in regard to the first  tenants  to occupy  the  apartment
units in the Apartment Housing,  copies of all tenant files including  completed
applications,  completed  questionnaires  or  checklist  of income  and  assets,
documentation  of third  party  verification  of income and  assets,  and income
certification forms (LIHTC specific).

         (b) Upon the request of the Limited Partner,  the General Partner shall
promptly  deliver to the Limited Partner,  at the expense of the Partnership,  a
copy of the information set forth in Section 14.1(a) above.  The Limited Partner
shall have the right upon reasonable request and during normal business hours to
inspect and copy any of the foregoing,  or any of the other books and records of
the Partnership or the Apartment Housing, at its own expense.

                                       57
<PAGE>

     Section 14.2 Accounting Reports.

         (a) By February 20 of each  calendar  year the  General  Partner  shall
provide  to the  Limited  Partner  and  the  Special  Limited  Partner  all  tax
information  necessary for the preparation of their federal and state income tax
returns and other tax returns  with regard to the  jurisdiction(s)  in which the
Partnership   is  formed  and  in  which  the  Apartment   Housing  is  located.
Notwithstanding,  the General  Partner shall deliver to the Limited  Partner and
the Special Limited Partner a draft copy of the information  requested herein at
least ten days prior to the above referenced due date.

         (b) By March 1 of each calendar year the General  Partner shall send to
the  Limited  Partner  and the  Special  Limited  Partner an  audited  financial
statement for the Partnership, which shall include, but is not limited to: (1) a
balance  sheet as of the end of such  fiscal  year  and  statements  of  income,
Partners'  equity and  changes in cash flow for such  fiscal  year  prepared  in
accordance with generally accepted  accounting  principles;  (2) a report of any
Distributions  made at any time during the fiscal year,  separately  identifying
Distributions  from Net  Operating  Income for the fiscal  year,  Net  Operating
Income for prior years, Sale or Refinancing  Proceeds,  and reserves;  and (3) a
report  setting  forth  the  amount  of all  fees  and  other  compensation  and
Distributions  and reimbursed  expenses paid by the  Partnership  for the fiscal
year to the  General  Partner  or  Affiliates  of the  General  Partner  and the
services performed in consideration therefor,  which report shall be verified by
the  Partnership's  Accountants.  Notwithstanding,  the  General  Partner  shall
deliver to the Limited  Partner and the Special  Limited Partner a draft copy of
the information requested herein at least ten days prior to the above referenced
due date.

         (c) Within 60 days after the end of each fiscal quarter in which a Sale
or Refinancing of the Apartment  Housing occurs,  the General Partner shall send
to the Limited Partner and the Special Limited Partner a report as to the nature
of the Sale or Refinancing  and as to the Income and Losses for tax purposes and
proceeds arising from the Sale or Refinancing.

     Section  14.3 Other  Reports.  The  General  Partner  shall  provide to the
Limited Partner and the Special Limited Partner the following reports:

         (a) during  construction and renovation,  on a regular basis, but in no
event  before  each draw  request by the  contractor,  a copy of the  Inspecting
Architect's report and other construction and renovation reports including,  but
not limited to, (1) the name of each person  performing work on the Improvements
or providing  materials for the  Improvements,  the work  performed or materials
supplied by said person and the code  number  corresponding  to the line item in
the  Construction  Budget  which the person will be paid,  (2) an  original  AIA
Document G702, or similar form acceptable to the Special Limited Partner, (3) if

                                       58
<PAGE>

not included in the  Inspecting  Architect's  report or the AIA Document G702, a
line item  break-down of the  Construction  and  Renovation  Budget (which shall
include,  description of work to be performed or materials to be supplied; total
dollar  amount  of the  work or  materials;  dollar  amount  of work  previously
completed  and paid or  materials  supplied and paid;  dollar  amount of work or
materials  to be paid per the current  disbursement  request;  dollar  amount of
materials  stored;  total dollar  amount of work  completed and stored as of the
current  disbursement date;  percentage of completion;  dollar amount of work or
materials needed to complete the line item; and retainage), (4) a reconciliation
of the sources and uses to determine that the Construction and Renovation Budget
is in balance and there are sufficient  funds to complete the  construction  and
renovation of the  Improvements,  and (5) copies of lien  releases,  or waivers,
from the Contractor and all  sub-contractors or material suppliers who were paid
the previous month;

         (b) during the rent-up phase, and continuing until the end of the first
six-month period during which the Apartment Housing has a sustained occupancy of
95% or better,  by the  twentieth day of each month within such period a copy of
the previous  month's rent roll (through the last day of the month) and a tenant
LIHTC compliance  worksheet similar to the monthly initial tenant  certification
worksheet  included in Exhibit "H" attached  hereto and  incorporated  herein by
this reference;

         (c) a quarterly tax credit  compliance  report similar to the worksheet
included  in  Exhibit  "H" due on or before  April 30 of each year for the first
quarter,  July 31 of each year for the second  quarter,  October 31 of each year
for the third  quarter  and January 31 of each year for the fourth  quarter.  In
order to  verify  the  reliability  of the  information  being  provided  on the
compliance  report the Special  Limited Partner may request a sampling of tenant
files to be provided.  The sampling will include,  but not be limited to, copies
of tenant  applications,  certifications  and third party  verifications used to
qualify  tenants.  If any  inaccuracies  are  found to  exist on the tax  credit
compliance report or any items of noncompliance are discovered then the sampling
will be expanded as determined by the Special Limited Partner;

         (d) a quarterly  report on operations,  in the form attached  hereto as
Exhibit  "H",  due on or before  April 30 of each year for the first  quarter of
operations,  July 31 of each year for the second quarter of operations,  October
31 of each year for the third quarter of operations  and January 31 of each year
for the fourth quarter of operations which shall include, but is not limited to,
an  unaudited  income  statement  showing all  activity in the reserve  accounts
required to be maintained pursuant to Section VIII of this Agreement,  statement
of  income  and  expenses,  balance  sheet  and rent  roll as of the end of each
calendar quarter of each year.

         (e)      by September 15 of each year, an estimate of LIHTC for that
year;

                                       59
<PAGE>

         (f) if the Apartment  Housing  receives a  reservation  of LIHTC in one
year but will not  complete the  construction,  renovation  and rent-up  until a
later year, an audited cost  certification  together with the Accountant's  work
papers  verifying  that the  Partnership  has expended the  requisite 10% of the
reasonably  expected cost basis to meet the carryover test provisions of Section
42 of the Code. Such certification  shall be provided to the Limited Partner and
Special  Limited Partner by December 31 of the year during which the reservation
was received.  Furthermore,  if materials and supplies are purchased to meet the
10% requirement then the General Partner shall provide to the Limited Partner an
opinion  of  counsel  that  title  to the  materials  and  supplies  pass to the
Partnership and that the Partnership bears the risk of loss of the materials and
supplies;

         (g)  during  the  Compliance  Period,  no  later  than the day any such
certification is filed, copies of any certifications  which the Partnership must
furnish to  federal  or state  governmental  authorities  administering  the Tax
Credit  program  including,  but not  limited  to,  copies of all annual  tenant
recertifications required under Section 42 of the Code;

         (h) by the  annual  renewal  date  each and  every  year,  an  executed
original or certified  copy of each and every  Insurance  policy or  certificate
required by the terms of this Agreement;

         (i) by  the  payment  date of the real  estate  property taxes each and
every year  verification  that the same has been paid in full;

         (j) on  or before  March 15th of  each  calendar  year, a  copy of  the
General  Partner's  updated  financial  statement as of December 31 of the
previous year;

         (k) on or  before  November  1 of  each  calendar  year,  a copy of the
following year's proposed  operating budget.  Each such Budget shall contain all
the  anticipated  Cash  Expenses of the  Partnership.  Such Budget shall only be
adopted with the Consent of the Special Limited Partner; and

         (l) notice of the  occurrence,  or of the likelihood of occurrence,  of
any event which has had a material adverse effect upon the Apartment  Housing or
the  Partnership,  including,  but not  limited  to,  any  breach  of any of the
representations and warranties set forth in Section 9.12 of this Agreement,  and
any inability of the  Partnership  to meet its cash  obligations  as they become
payable, within ten days after the occurrence of such event.

     Section  14.4 Late  Reports.  If the General  Partner  does not fulfill its
obligations  under  Sections  14.2 and 14.3  within the time  periods  set forth
therein, the General Partner,  using its own funds, shall pay as damages the sum
of $100 per week to the Limited Partner until such  obligations  shall have been

                                       60
<PAGE>

fulfilled.  If the General Partner shall so fail to pay, the General Partner and
its Affiliates shall forthwith cease to be entitled to any fees hereunder (other
than the Development  Fee) and/or to the payment of any Net Operating  Income or
Sale or  Refinancing  Proceeds to which the General  Partner  may  otherwise  be
entitled  hereunder.  Payments of fees and Distributions  shall be restored only
upon payment of such damages in full.

     Section  14.5  Annual Site  Visits.  The  Limited  Partner,  at the Limited
Partner's expense, has the right, upon reasonable notice to the General Partner,
to conduct a site visit  which  will  include,  in part,  an  inspection  of the
property,  a review of the  office and tenant  files and an  interview  with the
property manager.

     Section  14.6 Tax  Returns.  The General  Partner  shall  cause  income tax
returns for the Partnership to be prepared and timely filed with the appropriate
federal, state and local taxing authorities.

     Section 14.7 Fiscal Year. The fiscal year of the  Partnership  shall be the
calendar  year or such other period as may be approved by the  Internal  Revenue
Service for federal income tax purposes.

     Section 14.8 Banking.  All funds of the Partnership shall be deposited in a
separate bank account or accounts as shall be determined by the General  Partner
with the Consent of the Special Limited Partner. All withdrawals therefrom shall
be made upon checks signed by the General Partner or by any person authorized to
do so by the General  Partner.  The General Partner shall provide to any Partner
who requests same the name and address of the financial institution, the account
number and other relevant information regarding any Partnership bank account.

     Section 14.9 Certificates and Elections.

         (a) The General Partner shall file the First Year Certificate within 90
days  following  the  close of the  taxable  year  during  which  Completion  of
Construction  occurs and thereafter shall timely file any certificates which the
Partnership   must  furnish  to  federal  or  state   governmental   authorities
administering the Tax Credit programs under Section 42 of the Code.

         (b) The  General  Partner,  with the  Consent  of the  Special  Limited
Partner,  may, but is not required to, cause the  Partnership  to make or revoke
the election referred to in Section 754 of the Code, as amended,  or any similar
provisions enacted in lieu thereof.

                                       61
<PAGE>

                                   ARTICLE XV

                      DISSOLUTION, WINDING UP, TERMINATION
                       AND LIQUIDATION OF THE PARTNERSHIP

     Section 15.1 Dissolution of Partnership. The Partnership shall be dissolved
upon  the  expiration  of its  term  or  the  earlier  occurrence  of any of the
following events.

         (a) The  effective  date of the  Withdrawal  or removal of the  General
Partner,  unless  (1) at the time  there is at least one other  General  Partner
(which may be the  Special  Limited  Partner if it elects to serve as  successor
General Partner under Section 13.4 hereof) who will continue as General Partner,
or (2)  within  120 days  after the  occurrence  of any such  event the  Limited
Partner elects to continue the business of the Partnership.

         (b) The sale of the Apartment Housing and the receipt in cash of the
full amount of the proceeds of such sale.

         Notwithstanding   the  foregoing,   however,  in  no  event  shall  the
Partnership  terminate  prior to the expiration of its term if such  termination
would result in a violation of the Mortgage or any other  agreement with or rule
or regulation of any Mortgage lender to which the Partnership is subject.

     Section 15.2 Return of Capital  Contribution  upon  Dissolution.  Except as
provided  in  Sections  7.3 and  7.4 of  this  Agreement,  which  provide  for a
reduction or refund of the Limited Partner's Capital  Contribution under certain
circumstances, and which shall represent the personal obligations of the General
Partner, as well as the obligations of the Partnership,  each Partner shall look
solely to the assets of the  Partnership for all  Distributions  with respect to
the  Partnership  (including the return of its Capital  Contribution)  and shall
have no recourse  therefor (upon  dissolution or otherwise)  against any General
Partner.  No Partner  shall have any right to demand  property  other than money
upon  dissolution  and  termination of the  Partnership,  and the Partnership is
prohibited  from such a  distribution  of  property  absent  the  Consent of the
Special Limited Partner.

     Section 15.3 Distribution of Assets. Upon a dissolution of the Partnership,
the General  Partner (or, if there is no General  Partner then  remaining,  such
other  Person(s)  designated as the liquidator of the Partnership by the Special
Limited  Partner  or by the court in a  judicial  dissolution)  shall  take full
account of the Partnership assets and liabilities and shall liquidate the assets
as promptly as is consistent  with obtaining the fair value thereof,  subject to
any restrictions of the Project's HAP contract.

         (a) Upon  dissolution  and  termination,  after payment of, or adequate
provision for, the debts and obligations of the Partnership  pursuant to Section

                                       62
<PAGE>

11.2(a) through and including  11.2(c),  the remaining assets of the Partnership
shall be distributed to the Partners in accordance with the positive balances in
their Capital Accounts,  after taking into account all allocations under Article
X hereof.

         (b) In the event that a General  Partner  has a deficit  balance in its
Capital Account following the liquidation of the Partnership or its Interest, as
determined  after taking into account all Capital  Account  adjustments  for the
Partnership  taxable year in which such liquidation occurs, such General Partner
shall pay to the  Partnership  the  amount  necessary  to restore  such  deficit
balance   to   zero   in   compliance   with   Treasury    Regulation    Section
1.704-1(b)(2)(ii)(b)(3).

                  (1) The deficit  reduction amount shall be paid by the General
Partner by the end of such taxable year (or, if later,  within 90 days after the
date of Liquidation) and shall, upon liquidation of the Partnership,  be paid to
creditors of the Partnership or distributed to other Partners in accordance with
their positive Capital Account balances.

         (c) With respect to assets distributed in kind to the Partners in
liquidation or otherwise:

                  (1) unrealized  appreciation or unrealized depreciation in the
values of such  assets  shall be deemed to be Income and Losses  realized by the
Partnership  immediately prior to the liquidation or other  Distribution  event;
and

                  (2) such Income and Losses  shall be allocated to the Partners
in accordance with Section 10.2 hereof, and any property so distributed shall be
treated as a Distribution  of an amount in cash equal to the excess of such Fair
Market Value over the outstanding  principal  balance of and accrued interest on
any debt by which the property is encumbered.

         (d) For the purposes of Section 15.3(c),  "unrealized  appreciation" or
"unrealized  depreciation"  shall mean the  difference  between  the Fair Market
Value  of such  assets,  taking  into  account  the  Fair  Market  Value  of the
associated financing but subject to Section 7701(g) of the Code, and the asset's
Gross  Asset  Value.  Section  15.3(c) is merely  intended to provide a rule for
allocating  unrealized Income and Losses upon liquidation or other  Distribution
event,  and nothing  contained in Section 15.3(c) or elsewhere in this Agreement
is  intended  to treat or cause  such  Distributions  to be treated as sales for
value.  The  Fair  Market  Value  of  such  assets  shall  be  determined  by an
independent appraiser to be selected by the General Partner.

     Section 15.4 Deferral of  Liquidation.  If at the time of  liquidation  the
General  Partner or other  liquidator  shall determine that an immediate sale of
part or all of the  Partnership  assets could cause undue loss to the  Partners,
the  liquidator  may, in order to avoid  loss,  but only with the Consent of the
Special Limited Partner, either defer liquidation and retain all or a portion of

                                       63
<PAGE>

the assets or distribute all or a portion of the assets to the Partners in kind.
In the event that the liquidator  elects to distribute  such assets in kind, the
assets  shall  first  be  assigned  a  value  (by  appraisal  by an  independent
appraiser)  and the  unrealized  appreciation  or  depreciation  in value of the
assets shall be allocated to the Partners' Capital  Accounts,  as if such assets
had been sold, in the manner  described in Section  10.2,  and such assets shall
then be  distributed  to the  Partners  as  provided  herein.  In  applying  the
preceding  sentence,  the  Apartment  Housing shall not be assigned a value less
than the unamortized principal balance of any loan secured thereby.

     Section 15.5 Liquidation Statement. Each of the Partners shall be furnished
with a statement  prepared  or caused to be  prepared by the General  Partner or
other  liquidator,  which  shall set forth the  assets  and  liabilities  of the
Partnership as of the date of complete  liquidation.  Upon  compliance  with the
distribution plan as outlined in Sections 15.3 and 15.4, the Limited Partner and
Special  Limited  Partner  shall cease to be such and the General  Partner shall
execute,  acknowledge  and cause to be filed those  certificates  referenced  in
Section 15.6.

     Section 15.6  Certificates of  Dissolution;  Certificate of Cancellation of
Certificate of Limited Partnership.

         (a) Upon the dissolution of the Partnership,  the General Partner shall
cause to be filed in the office of, and on a form prescribed by the Secretary of
State of the State, a certificate of dissolution. The certificate of dissolution
shall set forth the Partnership's name, the Secretary of State's file number for
the Partnership, the event causing the Partnership's dissolution and the date of
the dissolution.

         (b) Upon the completion of the winding up of the Partnership's affairs,
the  General  Partner  shall  cause to be filed in the  office of, and on a form
prescribed   by,  the  Secretary  of  State  of  the  State,  a  certificate  of
cancellation  of the  Certificate  of Limited  Partnership.  The  certificate of
cancellation  of the  Certificate  of  Limited  Partnership  shall set forth the
Partnership's  name,  the Secretary of State's file number for the  Partnership,
and any other  information  which the  General  Partner  determines  to  include
therein.

                                   ARTICLE XVI

                                   AMENDMENTS

         This  Agreement  may be amended by a majority  consent of the  Partners
after a meeting or through  written  action  without a meeting of the  Partners,
which meeting or written notice shall be held after proper notice as provided in

                                       64
<PAGE>

Section  17.2 of this  Agreement.  For  purposes of this  Article XVI, a Partner
shall grant its consent to a proposed  amendment unless such Partner  reasonably
determines that the proposed amendment is adverse to the Partner's Interest.

                                  ARTICLE XVII

                                  MISCELLANEOUS

         Section 17.1      Voting Rights.

         (a) The  Limited  Partner  shall have no right to vote upon any matters
affecting   the   Partnership,   except   as   provided   in   this   Agreement.
Notwithstanding, at a meeting of the Partnership, the Limited Partner may vote:

                  (1)  to approve or disapprove the Sale or Refinancing of the
Apartment Housing prior to such Sale or Refinancing;

                  (2)  to remove the General Partner and elect a substitute
General Partner as provided in this Agreement;

                  (3)  to elect a successor General Partner upon the Withdrawal
of the General Partner;

                  (4)  to approve or disapprove the dissolution of the
Partnership;

                  (5)  subject to the provisions of Article XVI hereof, to amend
this Agreement;

                  (6)  to approve or disapprove the refinancing of the Mortgage
prior to such refinancing; or

                  (7)  on any other matter permitted in this Agreement.

         (b) On any  matter  where the  Limited  Partner  has the right to vote,
votes may only be cast at a duly called  meeting of the  Partnership  or through
written action without a meeting.

         (c) The  Special  Limited  Partner  shall  have the right to consent to
those  actions  or  inactions  of the  Partnership  and/or  General  Partner  as
otherwise  set forth in this  Agreement,  and the General  Partner is prohibited
from any action or inaction  requiring such consent unless such consent has been
obtained.  Notwithstanding the foregoing, this section does not apply to Section
17.12 (a) of this Agreement.

         Section 17.2 Meeting of Partnership. Meetings of the Partnership may be
noticed  either (a) at any time by the  General  Partner;  or (b) by the Limited
Partner or the Special Limited  Partner.  The notice for a meeting shall specify
the purpose of such meeting,  and the time and the place of such meeting  (which
shall be by telephone  conference or at the  principal  place of business of the

                                       65
<PAGE>

Partnership).  Any Partner  calling a Partners  meeting  shall  provide  written
notice to all Partners. The meeting shall not be held less than 15 days nor more
than 30 days from the Partners' receipt of the notice.  All meetings and actions
of the Limited  Partner  shall be governed in all  respects,  including  matters
relating  to  proxies,  record  dates  and  actions  without a  meeting,  by the
applicable provisions of the Act, as it shall be amended from time to time.

         Section 17.3 Notices.  Any notice given  pursuant to this Agreement may
be served personally on the Partner to be notified,  or may be sent by overnight
courier,  or may be  mailed,  first  class  postage  prepaid,  to the  following
address,  or to such other address as a party may from time to time designate in
writing:

      To the General Partner:    Lewis F. Weinberg
                                 505 5th Street, Suite 238
                                 Sioux City, Iowa, 51101

                                 Weinberg Investments, Inc.
                                 505 5th Street, Suite 238
                                 Sioux City, Iowa, 51101

                                 Sioux Falls Environmental Access, Inc.
                                 2101 W. 41St, Suite 2000
                                 Sioux City, Iowa, 57101

      To the Limited Partner:    WNC Housing Tax Credit Fund VI, L.P., Series 7
                                 c/o WNC & Associates, Inc.
                                 3158 Redhill Ave., Suite 120
                                 Costa Mesa, CA 92626-3416

      To the Special
      Limited Partner:           WNC Housing, L.P.
                                 3158 Redhill Ave., Suite 120
                                 Costa Mesa, CA 92626-3416

     Section 17.4  Successors and Assigns.  All the terms and conditions of this
Agreement  shall be binding upon and inure to the benefit of the  successors and
assigns of the Partners.

     Section  17.5  Recording  of  Certificate  of Limited  Partnership.  If the
General Partner should deem it advisable to do so, the Partnership  shall record
in the office of the County  Recorder of the county in which the principal place
of business of the Partnership is located a certified copy of the Certificate of
Limited  Partnership,  or any  amendment  thereto,  after  such  Certificate  or
amendment has been filed with the Secretary of State of the State.

                                       66
<PAGE>

     Section 17.6 Amendment of Certificate of Limited Partnership.

         (a) The General Partner, or any successor general partner,  shall cause
to be filed,  within 30 days after the happening of any of the following events,
an amendment to the Certificate of Limited Partnership reflecting the occurrence
of any of the following:

                  (1) a change in the name of the Partnership;

                  (2) a change in the street address of the Partnership's
principal executive office;

                  (3) a change in the address,  or the Withdrawal,  of a General
Partner,  or a change in the address of the agent for service of process, or
appointment of a new agent for service of process;

                  (4) the admission of a General Partner and that Partner's
address; or

                  (5) the  discovery  by the  General  Partner  of any  false or
erroneous material statement contained in the Certificate of Limited Partnership
or any amendment thereto.

         (b) The  Certificate  of  Limited  Partnership  may also be  amended in
conformity with this Agreement at any time in any other respect that the General
Partner determines.

         (c)  The  General  Partner  shall  cause  the  Certificate  of  Limited
Partnership to be amended, when required or permitted as aforesaid,  by filing a
certificate of amendment  thereto in the office of, and on a form prescribed by,
the  Secretary of State of the State.  The  certificate  of amendment  shall set
forth the  Partnership's  name,  the  Secretary  of State's  file number for the
Partnership and the text of the amendment.

         (d) In the event  of  a  Withdrawal or  Involuntary  Withdrawal of  the
General Partner,  and if  such General  Partner does  not file  an amendment  to
the  Certificate of Limited  Partnership as specified in this Section 17.6, then
the Special Limited Partner is hereby granted the specific authority to sign and
file such amendment.

     Section 17.7  Counterparts.  This  Agreement may be executed in one or more
counterparts,  each of which shall be deemed an original,  and said counterparts
shall  constitute  but one and the same  instrument  which may  sufficiently  be
evidenced by one counterpart.

     Section 17.8 Captions.  Captions to and headings of the Articles,  Sections
and  subsections  of this  Agreement  are  solely  for the  conveniences  of the
Partners,  are not a part of  this  Agreement,  and  shall  not be used  for the
interpretation  or  determination  of the  validity  of  this  Agreement  or any
provision hereof.

                                       67
<PAGE>

     Section 17.9 Saving  Clause.  If any  provision of this  Agreement,  or the
application  of such  provision  to any  Person or  circumstance,  shall be held
invalid,  the remainder of this Agreement,  or the application of such provision
to Persons  or  circumstances  other than those as to which it is held  invalid,
shall not be affected thereby.

     Section 17.10 Certain Provisions. If the operation of any provision of this
Agreement would  contravene the provisions of applicable law, or would result in
the imposition of general  liability on any Limited  Partner or Special  Limited
Partner, such provisions shall be void and ineffectual.

     Section 17.11 Tax Matters Partner. All the Partners hereby agree that Lewis
F. Weinberg is the designated General Partner shall be the "Tax Matters Partner"
pursuant to the Code and in connection  with any audit of the federal income tax
returns of the Partnership.

         (a) The Tax Matters  Partner shall  furnish to each Partner  notice and
information with respect to the following:  closing conference with an examining
agent;  proposed  adjustments,  rights of appeal,  and requirements for filing a
protest;  time and place of any appeals  conference;  acceptance by the Internal
Revenue Service of any settlement offer;  consent to the extension of the period
of  limitation   with  respect  to  all  Partners;   filing  of  a  request  for
administrative  adjustment  on  behalf  of the  Partnership;  filing  by the Tax
Matters Partner or any other Partner of any petition for judicial review; filing
of any appeal with respect to any judicial  determination;  and a final judicial
redetermination.

         (b)  If the  Tax  Matters  Partner  shall  determine  to  litigate  any
administrative  determination  relating to federal income tax matters,  then the
Tax Matters  Partner shall litigate such matter in such court as the Tax Matters
Partner shall decide in its sole discretion.

         (c) In  discharging  its duties and  responsibilities,  the Tax Matters
Partner shall act as a fiduciary (1) to the Limited Partner (to the exclusion of
the other  Partners)  insofar  as tax  matters  related to the Tax  Credits  are
concerned, and (2) to all of the Partners in other respects.

         (d) The Partners consent and agree that in connection with any audit of
the Partnership, or if the Tax Matters Partner withdraws from the Partnership or
the Tax Matters Partner becomes  Bankrupt,  then the Special Limited Partner may
become,  in its sole discretion,  a special general partner,  and become the Tax
Matters Partner.  The Limited Partner will make no claim against the Partnership
in respect of any action or omission by the Tax Matters Partner during such time
as the Special Limited Partner acts as the Tax Matters Partner.

                                       68
<PAGE>

         (e)  Nothing  herein  shall be  construed  as a waiver  by the  Limited
Partner of any of its rights under Chapter 631 of the Code. The General  Partner
shall not enter into any  settlement  agreement  purporting  to bind the Limited
Partner without the Limited Partner's consent.

     Section 17.12 Expiration of Compliance Period.

         (a)  Notwithstanding  any provision  hereof to the contrary (other than
this Section  17.12),  the Special  Limited  Partner shall have the right at any
time after the beginning of the last year of the  Compliance  Period to require,
by written  notice to the General  Partner,  that the General  Partner  promptly
submit a written  request to the applicable  State Tax Credit Agency pursuant to
Section 42(h) of the Code (or any successor provision) that such agency endeavor
to locate within one year from the date of such written  request a purchaser for
the Apartment  Housing who will  continue to operate the Apartment  Housing as a
qualified  low income  property,  at a purchase  price that is not less than the
minimum  amount  set forth in  Section  42(h)(6)  of the Code (or any  successor
provision).  In the event  that the State Tax  Credit  Agency  obtains  an offer
satisfying the conditions of the preceding  sentence,  the General Partner shall
promptly notify the Special Limited Partner in writing with respect to the terms
and conditions of such offer,  and, if the Special Limited Partner  notifies the
General  Partner that such offer should be accepted,  the General  Partner shall
cause the  Partnership  promptly to accept such offer and to proceed to sell the
Apartment Housing pursuant to such offer.

         (b)  Notwithstanding  any  other  provision  of this  Agreement  to the
contrary, the Special Limited Partner shall have the right at any time after the
end of the  Compliance  Period to  require,  by  written  notice to the  General
Partner (the "Required Sale Notice"),  that the General Partner promptly use its
best efforts to obtain a buyer for the Apartment  Housing on the most  favorable
terms then available. The General Partner shall submit the terms of any proposed
sale to the Special  Limited Partner for its approval in the manner set forth in
Section 17.12(a) hereof.  If the General Partner shall fail to so obtain a buyer
for the  Apartment  Housing  within six months of receipt of the  Required  Sale
Notice or if the Consent of the Special  Limited  Partner in its sole discretion
shall be withheld to any proposed sale,  then the Special  Limited Partner shall
have the  right at any  time  thereafter  to  obtain a buyer  for the  Apartment
Housing  on  terms  acceptable  to the  Special  Limited  Partner  (but not less
favorable to the Partnership  than any proposed sale previously  rejected by the
Special  Limited  Partner).  In the event that the  Special  Limited  Partner so
obtains a buyer,  it shall notify the General Partner in writing with respect to
the terms and  conditions  of the proposed  sale and the General  Partner  shall
cause the Partnership promptly to sell the Apartment Housing to such buyer.

         (c) A sale of the Apartment  Housing prior to the end of the Compliance
Period may only take place if the conditions of Section 42(j)(6) of the Code (or

                                       69
<PAGE>

any  successor  provision)  will be  satisfied  upon  such  sale by  having  the
purchaser  of the  Apartment  Housing  post the  required  bond on behalf of the
Partnership.

     Section 17.13 Number and Gender.  All pronouns and any  variations  thereof
shall be deemed to refer to the masculine,  feminine, neuter, singular or plural
as the identity of the Person or Persons may require.

     Section  17.14 Entire  Agreement.  This  Agreement  constitutes  the entire
understanding  between the parties with respect to the subject matter hereof and
all prior  understandings and agreements  between the parties,  written or oral,
respecting this transaction are merged in this Agreement.

     Section 17.15  Governing Law. This Agreement and its  application  shall be
governed by the laws of the State of Iowa.

     Section  17.16  Conflicts  with HAP  Contract.  In the event of a  conflict
between  this  Agreement  and the HAP  Contract,  and  the  obligations  imposed
pursuant thereto, the HAP Contract shall prevail.

     Section  17.17  Attorney's  Fees.  If a suit or  action  is  instituted  in
connection  with an  alleged  breach of any  provision  of this  Agreement,  the
prevailing party shall be entitled to recover,  in addition to costs,  such sums
as the court may adjudge  reasonable as attorney's  fees,  including fees on any
appeal.

     Section  17.18  Receipt  of  Correspondence.  The  Partners  agree that the
General  Partner  shall send to the  Limited  Partner  and the  Special  Limited
Partner within five days of receipt a copy of any correspondence relative to the
Apartment Housing's  noncompliance with the Mortgage,  relative to the Apartment
Housing's  noncompliance  with the Tax Credit rules or regulations,  relative to
the  acceleration  of the Mortgage  and/or  relative to the  disposition  of the
Apartment Housing.

     Section 17.19 Security  Interest and Right of Set-Off.  As security for the
performance  of the  respective  obligations to which any Partner may be subject
under this Agreement, the Partnership shall have (and each Partner hereby grants
to the Partnership) a security  interest in their  respective  Interests of such
Partner in all funds  distributable  to said Partner to the extent of the amount
of such obligation.

                                       70
<PAGE>

         IN WITNESS  WHEREOF,  this  Amended and  Restated  Agreement of Limited
Partnership  of Hickory  Lane  Partners  Limited  Partnership,  an Iowa  limited
partnership, is made and entered into as of the 8th day of August, 2000.

                            GENERAL PARTNER

                            /s/ LEWIS F. WEINBERG
                            Lewis F. Weinberg

                            Weinberg Investments, Inc.

                               By:  /s/ LEWIS F. WEINBERG
                                    Lewis F. Weinberg,
                                    President

                            Sioux Falls Environmental Access, Inc.

                               By:  /s/ ROLLYN H. SAMP
                                    Rollyn H. Samp,
                                    President

                            WITHDRAWING ORIGINAL LIMITED PARTNER

                            /s/ DONALD W. GOULART, JR.
                            Donald W. Goulart, Jr.

                            LIMITED PARTNER

                            WNC Housing Tax Credit Fund VI, L.P., Series 7

                                    By:  WNC & Associates, Inc.,
                                         General Partner

                                          By:  /s/ DAVID N. SHAFER
                                               David N. Shafer,
                                               Executive Vice President

Signatures continued...
                                       71
<PAGE>

                            SPECIAL LIMITED PARTNER

                            WNC Housing, L.P.

                                    By:  WNC & Associates, Inc.,
                                         General Partner

                                          By:  /s/ DAVID N. SHAFER
                                               David N. Shafer,
                                               Executive Vice President

                                       72
<PAGE>

                       EXHIBIT A TO PARTNERSHIP AGREEMENT

                                LEGAL DESCRIPTION

         All parcels of land described  herein are within the Southeast  Quarter
of Section 7, Township 88 North,  Range 47 West of the Fifth Principal  Meridian
in Sioux City, Woodbury County, Iowa.

BUILDING SITE:

         Commencing  at the  Northwest  Corner of said  Southeast  Quarter  then
Southerly  along the west side of said Southeast  Quarter for 328.78 feet;  then
with an angle to the left of  89(Degree)  37'30" for 112.50  feet;  then with an
angle to the right of 35(Degree)  01'48" for 537.75 feet;  then with an angle to
the right of  46(Degree)  00' on a bearing of S  08(Degree)  43'03" E for 946.41
feet; the S 33(Degree)  03'27" W for 162.25 feet; then N 56(Degree) 56'33" W for
267.00  feet to the Point of  Beginning;  then N  33(Degree)  03'27" E for 84.00
feet; then N 77(Degree)  40'01" E for 54.52 feet; then N 33(Degree) 03'27" E for
190.00 feet; then N 56(Degree) 56'33" W for 50.00 feet; then N 33(Degree) 03'27"
E for 161.43 feet; the S 08(Degree)  43'03" E for 418.35 feet; then S 33(Degree)
03'27" W for 162.25  feet;  then N  56(Degree)  56'33" W for 267.00  feet to the
Point of Beginning, containing 1.768 acres; together with:

EASEMENT NO. 1:

         Described  as,  Commencing  at the  Northwest  Corner of the  Southeast
Quarter of Said Section7;  then southerly  along the west line of said Southeast
Quarter for 328.78 fee; then with an angle to the left of 89(Degree)  37'30" for
112.50  feet;  then with an angle to the right of  35(Degree)  01'48" for 537.75
feet;  then  with an angle to the  right of  46(Degree)  00' on a  bearing  of S
08(Degree) 43'03" E for 528.06 feet to the Point of Beginning, then N 08(Degree)
43'03" W for 178.06  feet;  then S  71(Degree)  40'21" W for 45.64 feet;  then S
08(Degree) 43'03" E for 153.27 feet, then S 33(Degree) 03'27" W for 139.26 feet;
then S 56(Degree) 56'33" E for 45.00 feet; then N 33(Degree) 03'27" E for 136.43
feet to the Point of Beginning, containing 0.303 acre; together with:

EASEMENT NO. 2:

         Described  as,  commencing  at the  Northwest  Corner of the  Southeast
Quarter of said Section 7; then Southerly  along the west side of said Southeast
Quarter for 328.78 feet; then with an angle to the left of 89(Degree) 37'30" for
112.50  feet;  then with an angle to the right of  35(Degree)  01'48" for 537.75
feet;  then  with an angle to the  right of  46(Degree)  00' on a  bearing  of S
08(Degree) 43'03" E for 350.00 feet to the Point of Beginning; then N 71(Degree)

                                      A-1
<PAGE>

40'21" E for 166.65 feet to a point on the west  right-of-way  of Hickory  Lane;
then with an angle to the left of  94(Degree)  19'34" to the tangent of a 488.37
foot radius  curve which is concave  easterly,  then 40.04 feet along the are of
said curve which is the  westerly  right-of-way  of Hickory  Lane;  then with an
angle to the left of 90(Degree) 22'15" from the tangent of the 488.37 foot curve
to a bearing of S 71(Degree) 40'21" W for 204.14 feet; the S 08(Degree) 43'03" E
for  40.57  feet;  the N  71(Degree)  40'21" E for  45.64  feet to the  Point of
Beginning, containing 0.19 acre; together with:

SIDEWALK EASEMENT:

         A perpetual easement for pedestrian ingress and egress across a 10 foot
wide strip of land along and adjacent to and on the south side of the north line
of the northeast  portion of Tract H of Southern  Hills  Addition to Sioux City,
located in part of the Southeast Quarter of Section 7, Township 88 North,  Range
47 West of the 5th Principal Meridian,  Sioux City, Woodbury County,  Iowa, said
easement more particularly described as follows:

         Commencing  at the northwest  corner of the  Southeast  Quarter of said
Section 7; then South along the west side of said  Southeast  Quarter for 328.78
feet;  then with an angle to the left of 89(Degree)  37'30" for 112.5 feet; then
with an angle to the right of  35(Degree)  01'48"  for  537.75  feet to the most
southerly corner of Lot 14 of Lincolnshire,  Second Filing, an addition to Sioux
City;  then with an angle to the right of 46(Degree)  00' for 798.35 feet to the
Point  of  Beginning  for  this  easement;  then  with an  angle  to the left of
91(Degree)  48'40" for 203.52 fee;  then with an angle to the left of 34(Degree)
38'20" for 131.04 feet to a point on the westerly  right-of-way line of Southern
Hills  Drive;  then  with an angle to the  right of  142(Degree)  15'15"  to the
tangent of a curve  concave  easterly and having a radius of 516.29 feet,  along
said  right-of-way  line and along said curve for a distance of 16.02 feet; then
with an angle to the right of  39(Degree)  31'24" from the tangent of said curve
for a distance  of 121.60  feet;  then with an angle to the right of  34(Degree)
38'20" for 206.95 feet; then with an angle to the right of 91(Degree) 48'40" for
10.01 feet to the Point of Beginning, containing 0.08 acre; together with:

DRAINAGE EASEMENT NO. 1:

         A parcel of land  twenty  feet in width  lying ten feet on each side of
the following described centerline:

         Commencing at the northwest corner of the Southeast  Quarter of Section
7, Township 88 North, Range 47 West of the 5th Principal  Meridian,  Sioux City,
Woodbury County,  Iowa, then south along the west line of said Southeast Quarter

                                      A-2
<PAGE>

for a distance of 328.78 feet to the south line of Lincolnshire,  2nd Filing, an
Addition  to Sioux  City,  Iowa;  then  with an angle to the left of  89(Degree)
37'30" for a distance  of 112.5  feet  along the said south  line,  then with an
angle to the right of 35(Degree)  01'48" for a distance of 537.75 feet along the
southwesterly  line of said  addition  to the most  southerly  corner  of Lot 14
thereof;  then with an angle to the right of  46(Degree)  00' for a distance  of
1001.41 feet to the Point of Beginning of the centerline of the subject drainage
easement,  then with an angle to the left of 25(Degree) 55'11" for a distance of
97.86 feet; then with an angle to the right of 15(Degree)  55'46" for a distance
of  249.04  feet;  then with an angle to the right of  25(Degree)  02'42"  for a
distance of 231.60 feet to the north right of way of Interstate 520,  containing
0.27 acre, together with:

DRAINAGE EASEMENT NO. 2:

         Commencing at the northwest corner of the Southeast  Quarter of Section
7, Township 88 North, Range 47 West of the 5th Principal  Meridian,  Sioux City,
Woodbury County,  Iowa, then south along the west line of said Southeast Quarter
for a distance of 328.78 feet to the south line of Lincolnshire, 2nd Filing, and
addition  to Sioux  City,  Iowa;  then  with an angle to the left of  89(Degree)
37'30" for a distance  of 112.50  feet along the said south  line;  then with an
angle to the right of 35(Degree)  01'48" for a distance of 537.75 feet along the
southwesterly  line of said  addition  to the most  southerly  corner  of Lot 14
thereof;  then with an angle to the right of  46(Degree)  00' for a distance  of
946.41  feet to the  Point of  Beginning;  then  with an  angle to the  right of
41(Degree)  46'30" for a distance of 36.80 feet;  then with an angle to the left
of  67(Degree)  41'41" for a distance of 56.07  feet;  then with an angle to the
left of  154(Degree)  07'49"  for a  distance  of  77.88  feet to the  Point  of
Beginning. Said parcel contains 0.029 acres, subject to:

LEGAL DESCRIPTION - EASEMENT NO. 3:

         A  Parcel  of  Land,  within  which an  easement  has been  established
granting  ingress  and egress  for  utility  construction  and  maintenance  and
vehicular and  pedestrian  traffic,  within the Southeast  Quarter of Section 7,
Township 88 North, Range 47 West, Fifth Principal Meridian, Sioux City, Woodbury
County, Iowa, more particularly described as follows:

                                      A-3
<PAGE>

         Commencing  at the Northwest  Corner of the  Southeast  Quarter of said
Section 7; then  Southerly  along the west side of said  Southeast  Quarter  for
328.78  feet;  then with an angle to the left of  89(Degree)  37'30"  for 112.50
feet; then with an angle to the right of 35(Degree) 01'48" for 537.75 feet; then
with an angle to the right of 46(Degree) 00' on a bearing of S 08(Degree) 43'03"
E for  608.06  feet to the  Point of  Beginning  of said  Easement  No. 3; the N
56(Degree)  56'33" W for 98.29 feet;  then N 33degress  03'27" E for 20.00 feet;
then S 56degress  56'33" E for 80.43 feet;  the S 08(Degree)  43'03" E for 26.82
feet to the Point of Beginning; said easement contains 0.014 acre.

LEGAL DESCRIPTION - EASEMENT NO. 4:

         A  Parcel  of  Land,  within  which an  easement  has been  established
granting  ingress and egress for utility  construction  and  maintenance and for
vehicular and  pedestrian  traffic,  within the Southeast  Quarter of Section 7,
Township 88 North, Range 47 West, Fifth Principal Meridian, Sioux City, Woodbury
County, Iowa, more particularly described as follows:

         Commencing  at the Northwest  Corner of the  Southeast  Quarter of said
Section 7; then  southerly  along the west side of said  Southeast  Quarter  for
328.78  feet;  then with an angle to the left of  89(Degree)  37'30"  for 112.50
feet; then with an angle to the right of 35(Degree)  01'48" for 537.75 fee; then
with an angle to the right of 46(Degree) 00' on a bearing of S 08(Degree) 43'03"
E for 946.41 feet;  the S 33(Degree)  03'27" W for 162.25 feet; the N 56(Degree)
56'33" W for 267.00  feet;  the N  33(Degree)  03'27" E for 84.00  feet;  then N
77(Degree)  40'01" E for 54.52 feet to the Point of Beginning  for said Easement
No. 4; then S 56(Degree) 56'33" E for 50.00 feet; then N 33(Degree) 03'27" E for
20.00 feet; then N 56(Degree)  56'33" W for 50.00 feet; then S 33(Degree) 03'27"
W for 20.00 feet to the Point of Beginning, said parcel contains 0.023 acres.

                                      A-4
<PAGE>

                       EXHIBIT B TO PARTNERSHIP AGREEMENT

                              FORM OF LEGAL OPINION

WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
3158 Redhill Avenue, Suite 120
Costa Mesa, California  92626

RE:      Hickory Lane Partners Limited Partnership

Ladies and Gentlemen:

         You have  requested  our  opinion  with  respect to certain  matters in
connection  with the investment by WNC Housing Tax Credit Fund VI, L.P.,  Series
7, a California  limited  partnership  (the  "Limited  Partner") in Hickory Lane
Partners Limited  Partnership (the  "Partnership"),  an Iowa limited partnership
formed to acquire, own, develop, (rehabilitate, finance and operate an apartment
complex for low-income persons (the "Apartment Complex") in Sioux City, Woodbury
County,  Iowa. The general  partner(s) of the Partnership are Lewis F. Weinberg,
Weinberg  Investments,  Inc. and Sioux Falls  Environmental  Access,  Inc.  (the
"General Partner(s)").

         In rendering  the opinions  stated  below,  we have examined and relied
upon the following:

               (i)         [Certificate of Limited Partnership];

               (ii)        [Agreement of Limited  Partnership] (the "Partnership
                           Agreement");

               (iii)       A   preliminary   reservation   letter   from  [State
                           Allocating   Agency]  (the  "State   Agency")   dated
                           _________,      200___     conditionally     awarding
                           $_______________  in Federal tax credits annually for
                           each of ten years; and

                                      B-1
<PAGE>
WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
______________, 200__
Page 2

               (iv)        Such other  documents,  records and instruments as we
                           have deemed necessary in order to enable us to render
                           the opinions referred to in this letter.

         For  purposes of rendering  the  opinions  stated below we have assumed
that,  in  those  cases in which  we have  not  been  involved  directly  in the
preparation,  execution  or the  filing  of a  document,  that (a) the  document
reviewed  by us is an  original  document,  or a true and  accurate  copy of the
original document,  and has not been subsequently amended, (b) the signatures on
each original document are genuine, and (c) each party who executed the document
had proper authority and capacity.

Based on the foregoing we are of the opinion that:

         (a)  ________________________,  one  of  the  General  Partners,  is  a
[corporation/partnership] duly formed and validly existing under the laws of the
State of  _____________________  and has full power and  authority to enter into
and    perform    its    obligations    under   the    Partnership    Agreement.
_____________________,    one   of   the   other   General   Partners,    is   a
[corporation/partnership] duly formed and validly existing under the laws of the
State of  __________________  and has full power and authority to enter into and
perform its obligations under the Partnership Agreement.

         (b) The Partnership is a  limited partnership  duly formed and  validly
existing under the laws of the State of Iowa.

         (c) The  Partnership is validly  existing under and subject to the laws
of Iowa with full power and authority to acquire,  own, develop,  [rehabilitate,
finance and operate the  Apartment  Complex and to  otherwise  conduct  business
under the Partnership Agreement.

         (d) Execution of the  Partnership  Agreement by the General  Partner(s)
has been duly and validly  authorized by or on behalf of the General  Partner(s)
and,  having been  executed and  delivered  in  accordance  with its terms,  the
Partnership Agreement constitutes the valid and binding agreement of the General
Partner(s), enforceable in accordance with its terms.

         (e) The  execution  and  delivery of the  Partnership  Agreement by the
General Partner(s) does not conflict with and will not result in a breach of any
of the terms,  provisions or conditions of any agreement or instrument  known to
counsel to which any of the General  Partner(s) or the Partnership is a party or
by which any of them may be bound,  or any  order,  rule,  or  regulation  to be
applicable  to any of  such  parties  of  any  court  or  governmental  body  or
administrative  agency having  jurisdiction over any of such parties or over the
property.

                                      B-2
<PAGE>
WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
______________, 200__
Page 3

         (f) To the best of counsel's knowledge,  after due inquiry, there is no
litigation  or  governmental   proceeding  pending  or  threatened  against,  or
involving the Apartment  Complex,  the  Partnership or any General Partner which
would  materially  adversely  affect the  condition  (financial or otherwise) or
business of the Apartment Complex, the Partnership or any of the Partners of the
Partnership.

         (g) The  Limited  Partner  and the Special  Limited  Partner  have been
admitted to the Partnership as limited  partners of the  Partnership  under Iowa
law  and are  entitled  to all of the  rights  of  limited  partners  under  the
Partnership  Agreement.  Except as described in the  Partnership  Agreement,  no
person  is a  partner  of  or  has  any  legal  or  equitable  interest  in  the
Partnership,  and all former partners of record or known to counsel have validly
withdrawn  from the  Partnership  and  have  released  any  claims  against  the
Partnership arising out of their participation as partners therein.

         (h) Liability of the Limited Partner for obligations of the Partnership
is limited to the amount of the Limited Partner's capital contributions required
by the Partnership Agreement.

         (i) Neither the General  Partner(s) of the  Partnership nor the Limited
Partner nor the Special Limited Partner will have any liability for the Mortgage
represented  thereby (as those terms are defined in the  Partnership  Agreement,
and the  lender of the  Mortgage  Loan will  look only to its  security  and the
proceeds of the HAP  Contract in the  Apartment  Complex  for  repayment  of the
Mortgage Loan.

         (j) The Partnership owns a fee simple interest in the Apartment
Complex.

         (k) To the best of our actual knowledge and belief,  after due inquiry,
the Partnership has obtained all consents, permissions,  licenses, approvals, or
orders required by all applicable  governmental  or regulatory  agencies for the
development,  rehabilitation  and  operation of the Apartment  Complex,  and the
Apartment Complex conforms to all applicable Federal,  state and local land use,
zoning, health, building and safety laws, ordinances, rules and regulations.

         (l) The Apartment Complex has obtained a preliminary reservation of low
income housing tax credits ("LIHTC") from the State Agency. The final allocation
of the LIHTC and ultimately  eligibility of the Apartment Complex for such final

                                      B-3
<PAGE>
WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
______________, 200__
Page 4

allocation are subject to a series of requirements  which must be met, performed
or achieved at various times prior to and after such final allocation.  Assuming
all  such  requirements  are met,  performed  or  achieved  at the time or times
provided by applicable laws and regulations,  the Apartment Complex will qualify
for LIHTC.

         All of the  opinions  set forth above are  qualified to the extent that
the validity of any  provision of any agreement may be subject to or affected by
applicable bankruptcy,  insolvency,  reorganization,  moratorium or similar laws
affecting the rights of creditors generally. We do not express any opinion as to
the  availability  of any equitable or specific remedy upon any breach of any of
the covenants,  warranties or other  provisions  contained in any agreement.  We
have not examined,  and we express no opinion with respect to, the applicability
of, or liability under, any Federal, state or local law, ordinance or regulation
governing or  pertaining  to  environmental  matters,  hazardous  wastes,  toxic
substances or the like.

         We express no opinion as to any matter  except  those set forth  above.
These opinions are rendered for use by the Limited Partner and its legal counsel
which will rely on this opinion in connection  with federal  income tax opinions
to be rendered by that firm. This opinion may not be delivered to or relied upon
by any other person or entity without our express written consent.

Sincerely,

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

                                      B-4
<PAGE>

                       EXHIBIT C TO PARTNERSHIP AGREEMENT

                           CERTIFICATION AND AGREEMENT

        CERTIFICATION AND AGREEMENT made as of the date written below by Hickory
Lane  Partners   Limited   Partnership,   an  Iowa  limited   partnership   (the
"Partnership");  Lewis F. Weinberg,  Weinberg Investments,  Inc. and Sioux Falls
Environmental Access, Inc.  (collectively referred to as the "General Partner");
and Donald W. Goulart,  Jr.  (collectively  referred to as the "Original Limited
Partner")  for the benefit of WNC Housing Tax Credit Fund VI, L.P.,  Series 7, a
California  limited  partnership  (the  "Investment  Partnership"),  and  WNC  &
Associates, Inc. ("WNC").

         WHEREAS, the Partnership  proposes to admit the Investment  Partnership
as a limited  partner thereof  pursuant to an Amended and Restated  Agreement of
Limited  Partnership  of  the  Partnership  (the  "Partnership  Agreement"),  in
accordance with which the Investment  Partnership will make substantial  capital
contributions to the Partnership; and

         WHEREAS,  the Investment  Partnership  and WNC have relied upon certain
information  and  representations  described  herein in evaluating the merits of
investment by the Investment Partnership in the Partnership;

         NOW, THEREFORE,  to induce the Investment Partnership to enter into the
Partnership  Agreement and become a limited partner of the Partnership,  and for
$1.00 and other good and  valuable  consideration,  the receipt and  adequacy of
which are hereby  acknowledged,  the  Partnership,  the General  Partner and the
Original  Limited  Partner  hereby  agree  as  follows  for the  benefit  of the
Investment Partnership and WNC.

         1.  Representations,  Warranties and Covenants of the Partnership, the
             General Partner and the Original Limited Partner

         The  Partnership,  the General Partner and the Original Limited Partner
jointly  and  severally  represent,   warrant  and  certify  to  the  Investment
Partnership  and WNC  that,  with  respect  to the  Partnership,  as of the date
hereof:

                  1.1 The  Partnership is duly organized and in good standing as
a limited  partnership  pursuant to the laws of the state of its formation  with
full power and authority to own its apartment complex (the "Apartment  Complex")
and conduct its business; the Partnership,  the General Partner and the Original
Limited  Partner  have the power and  authority  to enter into and perform  this
Certification  and Agreement;  the execution and delivery of this  Certification
and Agreement by the  Partnership,  the General Partner and the Original Limited

                                      C-1
<PAGE>

Partner  have been duly and validly  authorized  by all  necessary  action;  the
execution and delivery of this  Certification and Agreement,  the fulfillment of
its terms and consummation of the transactions contemplated hereunder do not and
will not conflict  with or result in a violation,  breach or  termination  of or
constitute a default  under (or would not result in such a conflict,  violation,
breach,  termination  or default with the giving of notice or passage of time or
both) any other  agreement,  indenture or instrument by which the Partnership or
any General Partner or Original Limited Partner is bound or any law, regulation,
judgment,  decree or order  applicable to the Partnership or any General Partner
or  Original  Limited  Partner  or  any of  their  respective  properties;  this
Certification  and Agreement  constitutes the valid and binding agreement of the
Partnership,  the General Partner and the Original Limited Partner,  enforceable
against each of them in accordance with its terms.

                  1.2  The  General  Partner  has  delivered  to the  Investment
Partnership,  WNC or their affiliates all documents and information  which would
be  material  to a  prudent  investor  in  deciding  whether  to  invest  in the
Partnership. All factual information provided to the Investment Partnership, WNC
or their affiliates either in writing or orally, did not, at the time given, and
does not, on the date hereof, contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances  under which
they are made.

                  1.3  Each of  the  representations  and  warranties  contained
in the  Partnership  Agreement is true and correct as of the date hereof.

                  1.4 Each of the  covenants and  agreements of the  Partnership
and the General  Partner  contained in the  Partnership  Agreement has been duly
performed  to the extent  that  performance  of any  covenant  or  agreement  is
required on or prior to the date hereof.

                  1.5 All conditions to admission of the Investment  Partnership
as  the  investment  limited  partner  of  the  Partnership   contained  in  the
Partnership Agreement have been satisfied.

                  1.6 No  default  has  occurred  and is  continuing  under  the
Partnership  Agreement or any of the Project  Documents (as such term is defined
in the Partnership Agreement) for the Partnership.

                  1.7  The  Partnership  will  allocate to the Limited  Partner
the Projected  Annual Tax Credits,  or the Revised Projected Tax Credits, if
applicable.

                  1.8 The General  Partner agrees to take all actions  necessary
to claim the Projected Tax Credit, including,  without limitation, the filing of
Form(s) 8609 with the Internal Revenue Service.

                                      C-2
<PAGE>

                  1.9 No person or entity other than the Partnership holds any
equity interest in the Apartment Complex.

                  1.10 The  Partnership has the sole  responsibility  to pay all
maintenance  and operating  costs,  including all taxes levied and all insurance
costs, attributable to the Apartment Complex.

                  1.11 The Partnership,  except to the extent it is protected by
insurance and  excluding any risk borne by lenders,  bears the sole risk of loss
if the  Apartment  Complex is destroyed or condemned or there is a diminution in
the value of the Apartment Complex.

                  1.12 No person or entity except the  Partnership has the right
to any proceeds, after payment of all indebtedness,  from the sale, refinancing,
or leasing of the Apartment Complex.

                  1.13 No  General  Partner  is  related  in any  manner  to the
Investment  Partnership,  nor is any General  Partner  acting as an agent of the
Investment Partnership.

                  1.14  No event  has  occurred  which  would  have a  material
adverse  change to the  Limited  Partner's investment.

         2. Miscellaneous

                  2.1 This  Certification  and  Agreement is made solely for the
benefit of the Investment  Partnership and WNC, and their respective  successors
and  assignees,  and no other person shall acquire or have any right under or by
virtue of this Agreement.

                  2.2  This  Certification  and  Agreement  may be  executed  in
several  counterparts,  each of which shall be deemed to be an original,  all of
which together shall constitute one and the same instrument.

                  2.3   Capitalized   terms   used  but  not   defined  in  this
Certification Agreement shall have the meanings given to them in the Partnership
Agreement.

                  2.4 WNC accepts the  documentation  provided and  acknowledges
that the General Partner has complied with the due diligence  documents  request
list.

                                      C-3
<PAGE>

         IN WITNESS WHEREOF,  this Certificate and Agreement is made and entered
into as of the day of ____________, 2000.

PARTNERSHIP

Hickory Lane Partners Limited Partnership

------------------------
Lewis F. Weinberg

Weinberg Investments, Inc.,

By:      _____________________
         Lewis F. Weinberg,
         President

Sioux Falls Environmental Access, Inc.,

By:      ______________________
         Rollyn H. Samp,
         President

ORIGINAL LIMITED PARTNER

--------------------------
Donald W. Goulart, Jr.

                                      C-4
<PAGE>

                       EXHIBIT D TO PARTNERSHIP AGREEMENT

                         FORM OF COMPLETION CERTIFICATE

                   (to be used when rehabilitation completed)

                             COMPLETION CERTIFICATE

The undersigned, an architect duly licensed and registered in the State of Iowa,
has  reviewed  the final  working  plans and  specifications  for  Hickory  Lane
Partners Limited Partnership, an Iowa limited partnership (the "Partnership") in
connection with the  construction of improvements and renovation of certain real
property located in Sioux City, Woodbury County, Iowa (the "Improvements").

The undersigned  hereby certifies (i) that the Improvements  have been completed
in accordance with the aforesaid plans and specifications, (ii) that a permanent
certificate  of occupancy and all other  permits  required for the continued use
and occupancy of the  Improvements  have been issued with respect thereto by the
governmental agencies having jurisdiction  thereof,  (iii) that the Improvements
are in compliance with all  requirements  and  restrictions of all  governmental
authorities  having  jurisdiction  over  the  Improvements,  including,  without
limitation,  all applicable zoning,  building,  environmental,  fire, and health
ordinances,  rules  and  regulations  and (iv) to the best of my  knowledge  all
contractors, subcontractors and workmen who worked on the Improvements have been
paid in full except for normal retainages and amounts in dispute.

-----------------------------------
Apartment Housing Architect

Date:  ____________________________

Confirmed by:

-----------------------------------
General Partner

Date:  ____________________________

                                      D-1
<PAGE>

                          EXHIBIT E TO THE PARTNERSHIP

                           [ACCOUNTANT'S CERTIFICATE]
                            [Accountant's Letterhead]

_______________, 200____

WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
3158 Redhill Ave., Suite 120
Costa Mesa, California 92626

RE:  Partnership
     Certification as to Amount
     of Eligible Tax Credit Base

Gentlemen:

In  connection  with the  acquisition  by WNC Housing Tax Credit Fund VI,  L.P.,
Series 7 (the "Limited  Partner") of a limited  partnership  interest in Hickory
Lane  Partners   Limited   Partnership,   an  Iowa  limited   partnership   (the
"Partnership")  which  owns a certain  parcel  of land  located  in Sioux  City,
Woodbury County, Iowa and improvements  thereon (the "Apartment  Housing"),  the
Limited Partner has requested our  certification  as to the amount of low-income
housing tax credits  ("Tax  Credits")  available  with respect to the  Apartment
Housing under  Section 42 of the Internal  Revenue Code of 1986, as amended (the
"Code").  Based upon our review of [the  financial  information  provided by the
Partnership] of the Partnership, we are prepared to file the Federal information
tax  return of the  Partnership  claiming  annual  Tax  Credits in the amount of
$_______________,  which  amount is based on an  eligible  basis (as  defined in
Section  42(d) of the Code) of the  Apartment  Housing of  $________________,  a
qualified  basis (as  defined  in  Section  42(c) of the Code) of the  Apartment
Housing  of  $_________________  and an  applicable  percentage  (as  defined in
Section 42(b) of the Code) of _____%.

Sincerely,

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

                                      E-1
<PAGE>

                     EXHIBIT F TO THE PARTNERSHIP AGREEMENT

                           [CONTRACTOR'S CERTIFICATE]
                            [Contractor's Letterhead]

_______________, 200____

WNC Housing Tax Credit Fund VI, L.P., Series 7
c/o WNC & Associates, Inc.
3158 Redhill Avenue
Suite 120
Costa Mesa, California 92626

Re: Hickory Lane Partners Limited Partnership

Dear Ladies and Gentlemen:

The  undersigned  Developers &  Associates,  Inc.,  (hereinafter  referred to as
"Contractor"), has furnished or has contracted to furnish labor, services and/or
materials  (hereinafter  collectively  referred to as the "Work") in  connection
with the  improvement  of  certain  real  property  known as  __________________
located  in  Sioux  City,  Woodbury  County,  Iowa  (hereinafter  known  as  the
"Apartment Housing").

Contractor makes the following  representations and warranties regarding Work at
the Apartment Housing.

o    Work  on said  Apartment  Housing  has  been  performed  and  completed  in
     accordance with the plans and specifications for the Apartment Housing.

o    Contractor  acknowledges that all amounts owed pursuant to the contract for
     Work  performed for Hickory Lane Partners  Limited  Partnership  is paid in
     full.

o    Contractor  acknowledges that Hickory Lane Partners Limited  Partnership is
     not in violation  with terms and  conditions of the  contractual  documents
     related to the Apartment Housing.

o Contractor warrants that all parties who have supplied Work for improvement of
the Apartment Housing have been paid in full.

o Contractor  acknowledges the contract to be paid in full and releases any lien
or right to lien against the above property.

The  undersigned  has  personal  knowledge of the matters  stated  herein and is
authorized  and  fully  qualified  to  execute  this  document  on behalf of the
Contractor.

                                   (NAME OF COMPANY)

                                   By:_________________________________________

                                   Title:______________________________________

                                      F-1
<PAGE>

                          EXHIBIT G TO THE PARTNERSHIP

                                      G-1
<PAGE>

                          EXHIBIT H TO THE PARTNERSHIP
                              REPORT OF OPERATIONS
                 QUARTER ENDED:____________________________,200X

-------------------------------------       -----------------------------------
LOCAL PARTNERSHIP:
-------------------------------------       -----------------------------------

-------------------------------------       -----------------------------------
GENERAL PARTNER:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
FIRM NAME:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
ADDRESS:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
CITY, STATE, ZIP:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
PHONE:
-------------------------------------       -----------------------------------

-------------------------------------       -----------------------------------
PROPERTY NAME:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
ADDRESS:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
CITY, STATE, ZIP:
                                            -----------------------------------
-------------------------------------       -----------------------------------
RESIDENT MANAGER:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
PHONE:
-------------------------------------       -----------------------------------

-------------------------------------       -----------------------------------
ACCOUNTANT:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
FIRM:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
ADDRESS:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
CITY, STATE, ZIP:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
PHONE:
-------------------------------------       -----------------------------------

------------------------------------       -----------------------------------
MANAGEMENT COMPANY
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
ADDRESS:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
CITY, STATE, ZIP:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
PHONE:
-------------------------------------       -----------------------------------
-------------------------------------       -----------------------------------
CONTACT:
-------------------------------------       -----------------------------------

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

                              OCCUPANCY INFORMATION

A. Number of Units_____ Number of RA Units_____ Number of Section 8 Tenants ____

B. Occupancy for the Quarter has: Increased ____ Decreased_____
                                  Remained the Same _____

<PAGE>

C. Number of:  Move-Ins ______   Move-Outs __________   % of Occupancy ______

D. Average length of tenant residency:   1-6 months ______   6-12 months ______

                                         1-3 years  ______   Over 4 years_____

E. Number of Basic rent qualified applicants on waiting list:  ________

F. If the  apartments  are less than 90% occupied,  please  explain why and
describe what efforts are being made to lease-up remaining units.

 ___________________________________________________________________________

G. On site manager:   Full Time__________  Part Time____________.

   If part-time, the number of hours per week_____________.

                                      H-1
<PAGE>

                             OPERATIONAL INFORMATION

                Rent Schedule and Increases from Previous Quarter

                       Number     Monthly Rent         Rent Increases  Effective
                       of Units   Basic / Market    Amount    Percent    Date

1 Bedroom              ________   ______________    _________________  ________

2 Bedroom              ________   ______________    _________________  ________

3 Bedroom              ________   ______________    _________________  ________

                              PROPOSED MAINTENANCE

                                       Completed        Funded by
   Type                Description        or            Operations or    Amount
                                        Planned         Reserves
------------------------------------------------------------------------------
Interior Painting
------------------------------------------------------------------------------
Exterior Painting
------------------------------------------------------------------------------
Siding
------------------------------------------------------------------------------
Roofing
------------------------------------------------------------------------------
Drainage
------------------------------------------------------------------------------
Paving
------------------------------------------------------------------------------
Landscaping
------------------------------------------------------------------------------
Playground
------------------------------------------------------------------------------
Community Room
------------------------------------------------------------------------------
Laundry Room
------------------------------------------------------------------------------
Common Areas
------------------------------------------------------------------------------
Carpet
------------------------------------------------------------------------------
Appliances
------------------------------------------------------------------------------
Lighting
------------------------------------------------------------------------------
Other
------------------------------------------------------------------------------

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

Please describe in detail any major repairs:

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

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

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

                                      H-2
<PAGE>

                              CONDITION OF PROPERTY

THE OVERALL APPEARANCE OF THE BUILDING(S) IS:

Excellent                  Good                     Fair                Bad

THE OVERALL APPEARANCE OF THE GROUNDS IS:

Excellent                  Good                     Fair                 Bad

EXTERIOR CONDITION (Please Check Appropriate Box)
------------------------------------------------------------------------------
Type of Condition        Excellent       Good          Fair    Problems/Comments
------------------------------------------------------------------------------
Signage
-------------------------------------------------------------------------------
Parking Lots
-------------------------------------------------------------------------------
Office/Storage
-------------------------------------------------------------------------------
Equipment
-------------------------------------------------------------------------------
Community Building
-------------------------------------------------------------------------------
Laundry Room
-------------------------------------------------------------------------------
Benches/Playground
-------------------------------------------------------------------------------
Lawns, Plantings
-------------------------------------------------------------------------------
Drainage, Erosion
-------------------------------------------------------------------------------
Carports
-------------------------------------------------------------------------------
Fences
-------------------------------------------------------------------------------
Walks/Steps/Guardrails
-------------------------------------------------------------------------------
Lighting
-------------------------------------------------------------------------------
Painting
-------------------------------------------------------------------------------
Walls/Foundation
-------------------------------------------------------------------------------
Roof/Flashing/Vents
-------------------------------------------------------------------------------
Gutters/Splashblocks
-------------------------------------------------------------------------------
Balconies/Patios
-------------------------------------------------------------------------------
Doors Windows/Screens
-------------------------------------------------------------------------------
Elevators
-------------------------------------------------------------------------------

INTERIOR CONDITION
-------------------------------------------------------------------------------
Stairs
-------------------------------------------------------------------------------
Flooring
-------------------------------------------------------------------------------
Doors/Cabinets/Hardware
-------------------------------------------------------------------------------
Drapes/Blinds
-------------------------------------------------------------------------------
Interior Painting
-------------------------------------------------------------------------------
Refrig/Stoves/Sinks
-------------------------------------------------------------------------------
Bathroom/Tubs/Showers
    Toilets
-------------------------------------------------------------------------------

                                      H-3
<PAGE>

                                FINANCIAL STATUS

A.     Replacement Reserve is:   Fully-funded     Under-funded      Amount
       (complete attached schedule)
       Tax/Insurance Escrow is:  Fully-funded     Under-funded      Amount
       (complete attached schedule)
       Property is operating at a:    Surplus      Deficit          Amount

       If deficit, General Partner funding?        Yes     No       Amount

       Mortgage Payments are:   On Schedule        Delinquent       Amount

       Are the taxes current?          Yes         No
       (please provide copy of paid tax bill)
       Is the insurance current?       Yes         No        Renewal Date
       (please provide copy of yearly renewal)

B.     Please note and explain any significant changes in the following:

       Administrative Expense   Increase        Decrease            Amount

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

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

       Repairs/Maintenance Expense      Increase    Decrease         Amount

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

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

       Utility Expense        Increase          Decrease             Amount

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

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

       Taxes/Insurance Expense    Increase       Decrease            Amount

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

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

C.     Do you anticipate making a return to owner distribution?   Yes      No

       Explanation:
       ------------------------------------------------------------------------

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

D.     Please explain in detail any change in the financial condition:

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

       ------------------------------------------------------------------------
E.     Any insurance claims files?  Yes______   No______
       If yes, please explain:
       ------------------------------------------------------------------------

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

                                      H-4
<PAGE>

                              SCHEDULE OF RESERVES

                            Replacement    Tax & Insurance    Other      Total

Beginning Balance:

Deposits:

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

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

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

Total Deposits
                          -----------       ----------       -------    -------
Authorized Disbursements:
       Description:

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

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

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

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

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

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

Total Disbursements:     -----------        ----------       --------    ------

Ending Balance: (1)      -----------        ----------       --------    ------

Required Balance:        -----------        ----------       --------    ------

Over/under funding:      -----------        ----------       --------    ------

(1) Must agree with amount shown on the balance sheet.

Prepared By:                                                Date:
-------------------------------------------------------------------------------
Firm:                                                       Telephone:
-------------------------------------------------------------------------------

Reminder: Please include the following documents:

              1. Completed Report of Operations
              2. Balance Sheet
              3. Statement of Income & Expenses
              4. Rent roll for quarter ending
              5. Tax Credit Compliance Report

                                      H-5
<PAGE>

                          INITIAL TENANT CERTIFICATIONS
                                 PARTNERSHIP NAME

Fund:            Tax Credit Set-Asides Information:  Loan/Regulatory Set-Asides:
Property Name:   [ ] 20/50 or [  ] 40/60 Election
Address:         Does the 51% average apply?
                 [  ] Y [  ] N
                 Deeper Set-Aside __% @ 50% AMI

County:
                                                    Management Company

[ ] Multi-Family                                    Contact Person:
[ ] Elderly

  24 Number of Units                                Phone #

     Number of Exempt
     Units
LIHTC Project#

-----------------------------------------------------------------------------
                                                                Gross   Move-In
Unit  First Time   Move-In  No. of                      No. in Income   Income
No.   Tenant Name  Date     Bdrms  Sq. Ft.   Set-Aside  Unit   Move-In  Limits
-------------------------------------------------------------------------------
      BIN #        Certificate of Occupancy Date:
-----------------------------------------------------------------------------

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

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

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

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

     BIN #          Certificate of Occupancy Date:
-------------------------------------------------------------------------------

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

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

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
     BIN #           Certificate of Occupancy Date:
-------------------------------------------------------------------------------

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

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

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

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

<PAGE>

                          INITIAL TENANT CERTIFICATIONS
                                PARTNERSHIP NAME
(CONTINUED)

Tenant                                                            Tenant
Income       Income         Asset      Unit   Rent      Tenant    Utility
Qualified Verification  Verification   Rent   Subsidy   Payment   Allowance

-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------
YES
-------------------------------------------------------------------------------

<PAGE>

                          INITIAL TENANT CERTIFICATIONS
                                PARTNERSHIP NAME
(CONTINUED)

     Tenant                   Tenant            Overall
Gross     Maximum             Rent              Tenant
Rent      Rent                Qualified         Eligible

-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------
                              YES               YES
-------------------------------------------------------------------------------

                                H-6
<PAGE>

                     QUARTERLY TAX CREDIT COMPLIANCE REPORT
                                  PROPERTY NAME

Quarter Ending: Tax Credit Set-Asides Information:  Loan/Regulatory Set-Asides:
                [  ] 20/50 or [  ] 40/60 Election
                Does the 51% average apply? [  ] Y [  ] N
                Deeper Set-Aside : ( List Details)

County:    Allocation:                                 Management Company:

           Pre-1990 (Rent based on number of persons)  Contact Person:
           Elected to change No. Bedrm
           Post-1989 (Based on number of Bedroom)

[  ] Multi-Family  [  ] Elderly                         Phone No.

      Number of Units
      Number of Exempt Units                            Fax No.
                                                        Prepared by:

LIHTC Project#
-----------------------------------------------------------------------------
                                                          Gross    Annual
Unit   Tenant    Move-In   No. Of   Inc.   Set-  No. In   Annual   Income
No.    Name      Date      Bdrms    Pct.  Aside  Unit     Income   Limits
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

<PAGE>

                     QUARTERLY TAX CREDIT COMPLIANCE REPORT
                                  PROPERTY NAME
(CONTINUED)

Annual  Tenant                                   Less
Recert.  Income      Income     Assets   Unit    Rent     Tenant
Date   Qualified   Verified   Verified   Rent  Subsidy   Payment

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
<PAGE>

        Tenant              Tenant     Overall
Utility   Gross   Maximum    Rent       Tenat
Allow.    Rent    Rent    Qualified    Eligible

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

                                  H-7
<PAGE>

                       Tenant Tax Credit Compliance Audit
                         Document Transmittal Checklist

Unit Number          Property Name                                   Date

Tenant Name                                               Completed By:

Initial  _________        Annual________
  Check Box for Type of Certification         Management Company
                                                 This Section For WNC Use Only
Check Documents Being Sent
                                                          Received.  Reviewed
___Internal Checklist or worksheet
___Initial - Rental Application/Rental Agreement
___Initial - Questionnaire of Income/Assets
___Recertification - Questionnaire of Income/Assets
___Recertification - Addendum to Lease
___Employment Verification
___Employment Termination Verification
___Military  Verification
___Verification of Welfare Benefits
___Verification of Social Security Benefits
___Verification of Disability Benefits
___Unemployment Verification
___Verification of Unemployment Compensation
___Verification Worksmen Compensation
___Retirement/Annuities Verification
___Verification of Veterans Pension
___Verification of Child Support
___Verification of Alimony Support
___Disposed of Assets Last 2 yrs.
___Real Estate
___Investment
___Assets Verifications (savings, stocks etc.)
___Trusts/with Current Tax Return
___Lump Sum Settlements
___Notarized Affidavit of Support
___Certification of Handicap
___Notarized Self-Employed-Tax Return
___Notarized statement of no income
___Tenant Certification
------------------------------------------------------------------------------
                          This Section For WNC Use Only

         YES  NO
                     Are all required forms completed?
                     Are all required forms dated?
                     Did the Manager and Tenant sign all documents?
                     Third party verification of income completed?
                     Third party verification of assets completed?
                     Are verifications completed for all members 18 yrs. and
                     over?
                     Did all the members of the household 18 yrs. and
                     over sign all documents?
                     Is lease completed with a minimum of six months/ SRO
                     monthly?
                     Addendum completed?
                     Tenant Certification completed?
                     Are all members of the household full-time students?
                     Is utility allowance correct?
                     Is correct income limit being used?
                     Is correct rent limit being used?

                       For tenants with no income

                     Was notarized statement of no income obtained with tax
                     return?
                     or Were all sources verified (AFDC, Unemployment,
                        Soc. Sec., Disability)?

                                      H-8
<PAGE>

                        TAX CREDIT COMPLIANCE MONITORING:
                              ANNUAL CERTIFICATION

     As General Partner of Hickory Lane Partners Limited  Partnership,  I hereby
certify as to the following:

     1.  Hickory  Lane  Partners  Limited  Partnership  owns a 40  unit  project
("Apartment Housing") in Sioux City, Woodbury County, Iowa .

     2. An annual income certification (including supporting  documentation) has
been  received  from each tenant.  The income  certification  reflects  that the
tenant's income meets the income limitation  applicable to the Apartment Housing
pursuant to Section 42(g)(1) of the Internal Revenue Code ("Code").

     3. The Apartment  Housing  satisfies  the  requirements  of the  applicable
minimum set aside test as defined in Section 42(g)(1) of the Code.

     4. Each unit within the Apartment  Housing is rent restricted as defined in
Section 42(g)(2)of the Code.

     5. Each unit in the  Apartment  Housing is available for use by the general
public and not for use on a transient basis.

     6. Each  building in the  Apartment  Housing is suitable  for  occupancy in
accordance with local health, safety, and building codes.

     7.  During the  preceding  calendar  year,  there had been no change in the
eligible  basis,  as defined in Section 42(d)of the Code, of any building within
the Apartment Housing.

     8.  All  common  area  facilities  included  in the  eligible  basis of the
Apartment  Complex are provided to the tenants on a comparable  basis  without a
separate fee to any tenant in the Apartment Housing.

     9. During the preceding  calendar year when a unit in the Apartment Housing
became vacant  reasonable  attempts were made to rent that unit to tenants whose
incomes met the income  limitation  applicable to the Apartment Housing pursuant
to  Section  42(g)(1)  of the Code and while  that  unit was  vacant no units of
comparable  or smaller size were rented to tenants whose income did not meet the
income  limitation  applicable  to the  Apartment  Housing  pursuant  to Section
42(g)(1) of the Code.

     10. If the income of a tenant in a unit  increased  above the limit allowed
in Section 42  (g)(2)(D)(ii),  then the next  available  unit of  comparable  or
smaller  size was  rented to tenants  whose  incomes  met the income  limitation
applicable to the Apartment Housing pursuant to Section 42(g)(1) of the Code.

IN  VERIFICATION  OF THE  FOREGOING  ENCLOSED  HEREWITH  IS A COPY OF THE ANNUAL
INCOME  CERTIFICATION  RECEIVED FROM EACH TENANT IN THE PROJECT.  UPON REQUEST I
WILL PROVIDE  COPIES OF ALL  DOCUMENTATION  RECEIVED  FROM THE TENANT TO SUPPORT
THAT CERTIFICATION.

         I declare  under  penalty of perjury under the law of the State of Iowa
that the foregoing is true and correct.

         Executed this     day of            at              ,                 .
                       ---        ----------    -------------  ----------------

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

                                      H-9
<PAGE>

                      Calculation of Debt Service Coverage

                                        Month 1        Month 2       Month 3
                                     ------------   ------------  ------------

           INCOME

 Gross Potential Rent
 Other Income
 Vacancy     Loss
                                     ------------   ------------  ------------
 Adjusted Gross Income
                                     ------------   ------------  ------------

          OPERATING EXPENSES

 Utilities
 Maintenance
 Management Fee
 Administration
 Insurance
 Real Estate Taxes
 Other Expenses
                                     ------------   ------------  ------------
 Total Operating Expenses
                                     ------------   ------------  ------------

 Net Operating Income (1)
 Accrual adjustments for:
             R/E Taxes
             Insurance
             Tax/ Accounting
             Other
 Replacement Reserves

                                     ------------   ------------  ------------
 Income for DSC Calculation
                                     ============   ============  ============
 Stabilized Debt Service
                                     ------------   ------------  ------------
 Debt Service Coverage (2)
                                     ------------   ------------  ------------

     Please submit this form along with the following supporting documentation:

     Monthly Financial Reports (income statement, balance sheet, general ledger
          and rent rolls)
     Operating Budget
     Copies of bank statements.

     (1)  This  number  should  reconcile  easily  with  the  monthly  financial
     statements

     (2) The ratio between the Income for DSC  calculation  and Stabilized  Debt
     Service.  As  example,  a 1.15 DSC means that for every $1.00 of Stabilized
     Debt Service required  to be paid  there  must be  $1.15  of Net  Operating
     Income available.

                                      H-10

<PAGE>

                            DEVELOPMENT FEE AGREEMENT

         This Development Fee Agreement ("Agreement"), is entered into as of the
date written below by and between Weinberg Investments,  Inc.  ("Developer") and
Hickory  Lane  Partners  Limited   Partnership,   an  Iowa  limited  partnership
("Owner").  Developer and Owner collectively may be referred to as the "Parties"
or individually may be referred to as a "Party".

                                    RECITALS

         A. Owner has acquired the real property located in Sioux City, Woodbury
County,  Iowa, as more  particularly  described in Exhibit A attached hereto and
incorporated herein (the "Real Property").

         B. Owner  intends to renovate  the 40 unit  low-income  rental  housing
complex and other related improvements, which is intended to qualify for federal
low-income housing tax credits (the "Apartment Housing").

         C.  Prior  to the  date  of  this  Agreement  Developer  has  performed
substantial  development  services  with  respect  to the  Apartment  Housing as
specified in Section 2.3 of this Agreement. Developer has also agreed to oversee
the development of the Apartment  Housing until all  construction and renovation
work is completed and to provide certain services relating thereto.  The Parties
recognize and  acknowledge  that the Developer is, and has been, an  independent
contractor  in all  services  rendered  to,  and to be  rendered  to,  the Owner
pursuant to this Development Fee Agreement.

         D. Owner  desires to commit its  existing  development  agreement  with
Developer into writing  through this  Development  Fee Agreement for Developer's
services to manage,  oversee, and complete development of the Apartment Housing.
Developer desires to commit its existing  development  agreement with Owner into
writing  through this  Development  Fee  Agreement  and  Developer is willing to
assign all  development  rights to the Apartment  Housing to Owner, to undertake
performance of such development services,  and to fulfill all obligations of the
Developer set forth in this  Agreement,  in  consideration  of Owner's  restated
promise to pay to Developer the fee specified in this Agreement.

         NOW  THEREFORE,  in  consideration  of the  foregoing  recitals and the
mutual  promises  and  undertakings  in this  Agreement,  and for other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, Owner and Developer agree as follows.

                                       1
<PAGE>

                                    SECTION I
                               CERTAIN DEFINITIONS

     As used in this  Agreement,  the following terms shall,  when  capitalized,
have the following meanings:

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

     "Construction  and  Renovation  documents"  means  the  contract  documents
between the Owner and the Lender pertaining to the acquisition and renovation of
the Apartment Housing.

     "Contractor"  means  Developers & Associates,  Inc. and Oakleaf Real Estate
Management.

     "Department" means the Iowa Finance  Authority,  the agency responsible for
the reservation and allocation of Tax Credits.

     "Development  Fee"  means the fee for  development  services  described  in
Section 2 of this Agreement.

     "Lender" means Security  National Bank,  which has committed to make a loan
to finance construction and renovation of the Apartment Housing.

     "Loan"  means the loan to finance the  acquisition  and  renovation  of the
Apartment Housing, made to Owner by the Lender.

     "Partnership Agreement" shall mean the Third Amended and Restated Agreement
of Limited  Partnership of Hickory Lane Partners  Limited  Partnership,  an Iowa
limited partnership.

     "Tax Credits" means the low-income  housing tax credits found in Section 42
of  the  Code,  and  all  rules,   regulations,   rulings,   notices  and  other
promulgations thereunder.

                                    SECTION 2
                     ENGAGEMENT OF DEVELOPER; FEE; SERVICES

     2.1 Engagement;  Term. Owner hereby confirms the engagement of Developer to
act as developer of the Apartment Housing,  and to perform the various covenants
and obligations of the Developer under this Agreement. Developer hereby confirms
and  accepts  such  engagement  and agrees to perform  fully and timely each and
every one of its obligations  under this Agreement.  The term of such engagement
shall commence on the date hereof and subject to the  pre-payment  provisions of
Section 3 shall expire on December 31, 2012.

     2.2 Development Fee. In  consideration of Developer's  prior activities and
Developer's  agreement to provide  development  services during the term of this

                                       2
<PAGE>

Agreement,  Owner agrees to pay the Developer a Development Fee in the amount of
$250,000 ("Development Fee"). The Development Fee shall be payable in accordance
with Section 3 of this Agreement.

     2.3 Development Services.

         (a) Prior Services. Owner acknowledges that Developer has, prior to the
date  hereof,  performed  substantial  development  services  relating   to  the
Apartment  Housing.  Such  services (the  "Prior Services")  have  included  the
following.

                  (1)      Services Rendered Prior to the date of the Agreement.

                           (A)      Developer has negotiated  and conferred
with the Contractor and  recommended to the Owner to enter into a construction
and renovation contract with the Contractor for the building of the Apartment
Housing.

                           (B)      Developer has:  estimated the cost of
construction and renovation; determined the construction and renovation  period;
prepared a  monthly-estimated  construction  and renovation chart reflecting the
construction and renovation  services  required each month; and prepared a
preliminary construction and renovation budget.

                           (C)      Developer  has  reviewed  the plans and
specifications  for  compliance  with design  criteria and construction and
renovation contracts.

                           (D)      Developer has negotiated and conferred  with
public  authorities relating to traffic control, zoning, flood control and other
matters affecting the development of the Apartment Housing.

                           (E)      Developer has negotiated  and conferred with
an architect and  recommended to the Owner to execute an architectural contract
for the planning and design of the Apartment Housing.

                           (F)      Developer has placed its own capital at risk
in  anticipation  of the  Apartment  Housing  being constructed, leased and Tax
Credits awarded.

                  (2)      Other Prior Services.

                           (A) Developer  has created,  refined and analyzed the
financial projections for the Apartment Housing.

                           (B)      Developer has negotiated,  conferred,  and
worked with the Apartment Housing  architect,  engineers and Contractor with
regard to preparation,  refinement,  and finalization of the plans and
specifications  for the  renovation  of the  Apartment  Housing,  and projected
construction and renovation schedules and costs.

                                       3
<PAGE>

                           (C)      Developer  has  negotiated  and  conferred
with the Lender to obtain the project  Loan through the Lender purchase of tax
exempt private  activity bonds issued by the Iowa Finance Authority.

                           (D)      Developer  has negotiated and conferred with
an insurance  carrier to provide a builder's  risk policy during construction
and renovation.

                           (E)      Developer  has applied,  negotiated  and
conferred with the Iowa Finance Authority to provide an allocation of tax exempt
private  activity bond authority for the project along with an allocation of
LIHTC.

         (b)  Future   Services.   Developer  shall  oversee   construction  and
renovation  of the  Apartment  Housing on Owner's  behalf,  as  provided in this
Section  2.3(b)(1).  Owner shall allow  Developer  full access to the  Apartment
Housing during the construction and renovation period. Developer and Developer's
agents shall perform their work in a manner that minimizes interference with the
management and operation of the Apartment Housing.

                  (1)  Developer shall exert its best efforts to ensure that the
Contractor performs its obligations  under the Construction  and Renovation
documents in a diligent and timely manner.

                  (2) Developer shall participate in and provide assistance with
regard to pre-construction  and renovation  conferences and pre-construction and
renovation  documents,  including  drawings,   specifications,   contracts,  and
schedules.

                  (3) Developer shall review all Construction and Renovation
documents,  identify construction  and  renovation  issues and  participate in
the resolution of such issues.

                  (4)  Developer shall review and approve subcontract bids
received by the Contractor.

                  (5)  Developer shall establish and administer field order and
change order procedures.

                  (6)  Developer   shall   coordinate   performance  of  Owner's
obligations  under the  construction  and  renovation  phase  for the  Apartment
Housing, including the preparation of draw requests.

                  (7)  Developer  shall  attend   construction   and  renovation
progress  meetings at the  Apartment  Housing site to monitor  construction  and
renovation  progress  and advise  Owner and the  Contractor  with respect to the
resolution of construction and renovation issues.

                  (8)  Developer shall review the Contractor's monthly pay
applications.

                                       4
<PAGE>

                  (9)  Developer  shall monitor the  Contractor's  progress with
respect to the approved  Apartment  Housing schedule and keep the Owner informed
of all  pertinent  Apartment  Housing  issues and  construction  and  renovation
progress.

                  (10)  Developer  shall  advise Owner with respect to relations
with engineers, architects, and other construction and renovation professionals.

                  (11)  Developer  shall be available for immediate  response in
critical  situations  arising  during the  construction  and  renovation  of the
Apartment Housing.

                  (12)  Developer  shall  coordinate  relations with the City of
Sioux  City  and  other  governmental   authorities  having   jurisdiction  over
development of the Apartment Housing.

         (c) Assignment of Development Rights. Developer hereby assigns to Owner
all  rights to the  development  of the  Apartment  Housing,  including  but not
limited to, all tangible and intangible  rights arising with respect to the name
Hickory Lane Partners Limited Partnership,  the design of the Apartment Housing,
the plans and  specifications  for the Apartment  Housing and all rights arising
under the agreements  with  Apartment  Housing  architects,  engineers and other
Apartment Housing design and construction and renovation professionals.

                                    SECTION 3
                            DEVELOPMENT FEE PAYMENTS

     3.1  Services  Rendered  Prior to the date of this  Agreement.  The Parties
acknowledge  and  agree  that  Developer  has  earned  the sum of  $_________for
services  rendered,  that said  amount is  reasonable  in  relation  to the work
performed,  is fully earned as of that date and said amount shall be paid in any
event  notwithstanding  the termination of this  Agreement.  The Parties further
acknowledge  and  agree  that the  Owner  has  accrued  the  Development  Fee of
$________,  under its method of accounting, and has reported the Development Fee
expense on its 2000 income tax return.

     3.2 Payment of Development  Fee. The  Development  Fee shall be paid to the
Developer from capital contribution payments received by the Owner in accordance
with Section 9.2(b) of the Partnership Agreement.  If the Development Fee is not
paid in full in accordance with Section 9.2(b) of the Partnership Agreement then
the balance of the  Development  Fee shall be paid from  available net operating
income  in  accordance  with  the  terms  of  Section  11.1  of the  Partnership
Agreement,  but  in no  event  later  than  December  21,  2012.  Also,  if  the
Development  Fee is not paid in full in  accordance  with Section  9.2(b) of the
Partnership Agreement then the unpaid portion shall accrue interest at a rate

                                       5
<PAGE>

equal to the 5-year  Treasury  money market rate in effect as of the date of the
last  capital   contribution   payment  referenced  in  Section  7.2(b)  of  the
Partnership Agreement.

                                    SECTION 4
                                   TERMINATION

         Neither Party to this Agreement  shall have the right to terminate this
Agreement prior to the expiration of the term without cause. Owner may terminate
this Agreement without further liability, for cause, which shall mean any one of
the following:

         (a) a  material  breach by  Developer  of its  obligations  under  this
Agreement that is not cured within thirty (30) days after notice thereof (or, as
to any non-monetary obligations that is not reasonably capable of cure within 30
days,  and  provided  that  cure is  commenced  within  10 days  of  notice  and
diligently pursued thereafter to completion,  within such time as may reasonably
be necessary to complete such cure);

         (b) a fraudulent or intentionally incorrect report by Developer to
Owner with respect to the Apartment Housing; or

         (c) any intentional misconduct or gross negligence by Developer with
respect to its duties under this Contract.

         Upon proper  termination  of this  Agreement by Owner  pursuant to this
Section 4, all rights of Developer to receive unearned Development Fees pursuant
to this  Agreement with respect to services not yet performed  shall  terminate.
Developer  shall receive the full  Development  Fee for Prior Services and shall
receive  a portion  of the  Development  Fee for  Future  Services  based on the
percentage of completion of construction and renovation of the Apartment Housing
at the time of termination. Nothing in this Section 4 shall be deemed to prevent
Owner from  bringing an action  against  Developer to recover  fully all damages
resulting from any of the causes set forth in paragraphs  (a), (b) or (c) above,
or to prevent Owner from  contending in any action or proceeding that the Future
Services were not earned by Developer.

                                    SECTION 5
                               GENERAL PROVISIONS

     5.1 Notices. Notices required or permitted to be given under this Agreement
shall be in writing sent by  registered  or  certified  mail,  postage  prepaid,
return receipt  requested,  to the Parties at the following  addresses,  or such
other  address as is  designated  in writing by the Party,  the date of registry
thereof, or the date of certification  receipt therefor being deemed the date of
such notice;  provided,  however, that any written communication containing such
information sent to a Party actually received by a Party shall constitute notice
for all purposes of this Agreement.

                                       6
<PAGE>

If to Developer:                    Weinberg Investments, Inc.
                                    505 5th Street, Suite 238,
                                    Sioux City, IA  51101

If to Owner:                        Hickory Lane Partners Limited Partnership
                                    505 5th Street, Suite 238,
                                    Sioux City, IA  51101

     5.2 Interpretation.

         (a) Headings.  The section  headings in this Agreement are included for
convenience  only;  they do not give full  notice of the terms of any portion of
this  Agreement and are not relevant to the  interpretation  of any provision of
this Agreement.

         (b)  Governing  Law. The Parties  intend that this  Agreement  shall be
governed  by and  construed  in  accordance  with the laws of the  state of Iowa
applicable  to  contracts  made and  wholly  performed  within  Iowa by  persons
domiciled in Iowa.

         (c)  Severability.  Any  provision  of this  Agreement  that is  deemed
invalid or  unenforceable  shall be ineffective to the extent of such invalidity
or  unenforceability,  without  rendering invalid or unenforceable the remaining
provisions of this Agreement.

     5.3 Integration; Amendment. This Agreement constitutes the entire agreement
of the Parties  relating to the subject  matter  hereof.  There are no promises,
terms, conditions, obligations, or warranties other than those contained herein.
This  Agreement  supersedes  all  prior  communications,   representations,   or
agreements,  verbal or written, among the Parties relating to the subject matter
hereof. This Agreement may not be amended except in writing.

     5.4 Attorney' Fees. If any suit or action arising out of or related to this
Agreement is brought by any Party to any such  document,  the  prevailing  Party
shall be entitled to recover the costs and fees  (including  without  limitation
reasonable  attorneys'  fees and  costs of  experts  and  consultants,  copying,
courier and telecommunication costs, and deposition costs and all other costs of
discovery)  incurred  by such  Party in such suit or action,  including  without
limitation to any post-trial or appellate proceeding.

     5.5 Binding Effect.  This Agreement shall bind and inure to the benefit of,
and be  enforceable  by, the  Parties  hereto and their  respective  successors,
heirs, and permitted assigns.

     5.6 Assignment. Neither Party may assign this Agreement without the consent
of the other Party.  No assignment  shall  relieve any Party of liability  under
this Agreement unless agreed in writing to the contrary.

                                       7
<PAGE>

     5.7 Third-Party Beneficiary Rights. No person not a Party to this Agreement
is an intended beneficiary of this Agreement,  and no person not a Party to this
Agreement  shall  have  any  right  to  enforce  any  term  of  this  Agreement.
Notwithstanding,  the Parties  acknowledge  that WNC Housing Tax Credit Fund VI,
L.P., Series 7 shall have the right to enforce any term of this Agreement.

     5.8  Counterparts.  This  Agreement  may  be  executed  in  any  number  of
counterparts, all of which taken together shall constitute one agreement binding
on all the Parties,  notwithstanding that all Parties are not signatories to the
same counterpart.

     5.9  Further  Assurances.  Each Party  agrees,  at the request of the other
Party,  at any time and from time to time after the date hereof,  to execute and
deliver  all  such  further  documents,  and to take and  forbear  from all such
action, as may be reasonably  necessary or appropriate in order more effectively
to perfect the transfers or rights  contemplated  herein or otherwise to confirm
or carry out the provisions of this Agreement.

     5.10 Mandatory Arbitration. Any person enforcing this Agreement may require
that all disputes,  claims,  counterclaims,  and defenses ("Claims") relating in
any way to this  Agreement or any  transaction of which this Agreement is a part
(the  "Transaction"),  be settled by binding  arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association and Title 9
of the U.S.  Code.  All claims  will be subject to the  statutes  of  limitation
applicable if they were litigated.

         If arbitration  occurs,  one neutral  arbitrator will decide all issues
unless either  Party's Claim is $100,000.00 or more, in which case three neutral
arbitrators  will decide all issues.  All arbitrators  will be active Iowa State
Bar members in good standing. In addition to all other powers, the arbitrator(s)
shall  have the  exclusive  right to  determine  all  issues  of  arbitrability.
Judgment on any arbitration award may be entered in any court with jurisdiction.

     If  either  Party  institutes  any  judicial  proceeding  relating  to  the
Transaction,  such action shall not be a waiver of the right to submit any Claim
to arbitration.  In addition,  both Parties have the right before,  during,  and
after any arbitration to exercise any of the following remedies, in any order or
concurrently:  (i)  setoff,  (ii)  self-help  repossession,  (iii)  judicial  or
non-judicial  foreclosure  against real or personal  property  collateral,  (iv)
provisional remedies, including injunction, appointment of receiver, attachment,
claim and delivery, and replevin.

     This arbitration clause cannot be modified or waived by either Party except
in a  writing  that  refers  to this  arbitration  clause  and is signed by both
Parties.

                                       8
<PAGE>

         IN WITNESS  WHEREOF,  the  Parties  have caused  this  Development  Fee
Agreement to be executed as of ___________________, 2000.

DEVELOPER:                          Weinberg Investments, Inc.

                                    By:     ____________________________
                                            Lewis F. Weinberg,
                                            President

OWNER:                     Hickory Lane Partners Limited Partnership

                                    Weinberg Investments, Inc.
                                    General Partner

                                    By:     _____________________________
                                            Lewis F. Weinberg,
                                            President

                                       9
<PAGE>

                                    EXHIBIT A

<PAGE>

                               GUARANTY AGREEMENT

         FOR VALUE  RECEIVED,  the  receipt and  sufficiency  of which is hereby
acknowledged,  and in  consideration  of the agreement of Weinberg  Investments,
Inc., (the "Developer") to permit deferral of the $250,000 due from Hickory Lane
Partners  Limited  Partnership  an Iowa limited  partnership  ("Debtor")  to the
Developer, the undersigned Guarantor(s),  hereby unconditionally  guarantees the
full and prompt payment when due,  whether by  acceleration or otherwise of that
certain Developer Fee from Debtor to the Developer, evidenced by the Development
Fee Agreement  dated the even date  herewith,  and  incorporated  herein by this
reference.  The  foregoing  described  debt is  referred to  hereinafter  as the
"Liabilities" or "Liability."

         The  undersigned  further agree to pay all expenses paid or incurred by
the Debtor or Developer in endeavoring to collect the  Liabilities,  or any part
thereof,  and in enforcing the Liabilities or this Guaranty Agreement (including
reasonable  attorneys'  fees if  collected  or  enforced  by law or  through  an
attorney-at-law).  The  undersigned  hereby  represents  and  warrants  that the
extension of credit or other financial accommodations by the Developer to Debtor
will be to the interest and advantage of the undersigned,  and acknowledges that
this Guaranty  Agreement is a substantial  inducement to the Developer to extend
credit to Debtor and that the  Developer  would not  otherwise  extend credit to
Debtor.

         Debtor  or  Developer  may,  from  time to time,  without  notice to or
consent of the  undersigned,  (a) retain or obtain a  security  interest  in any
property  to secure any of the  Liabilities  or any  obligation  hereunder,  (b)
retain or obtain the primary or secondary  liability of any party or parties, in
addition to the  undersigned,  with  respect to any of the  Liabilities  and (c)
resort to the undersigned for payment of any of the Liabilities,  whether or not
the Debtor or Developer shall have resorted to any property  securing any of the
Liabilities or any obligation hereunder or shall have preceded against any other
party primarily or secondarily liable on any of the Liabilities.

         Debtor and Developer must mutually agree to (a) extend or renew for any
period this Agreement  (whether or not longer than the original period) or alter
any  of  the  Liabilities,  (b)  release  or  compromise  any  Liability  of the
undersigned  hereunder or any Liability of any other party or parties  primarily
or secondarily liable on any of the Liabilities,  or (c) release,  compromise or
subordinate their title or security  interest,  or any part thereof,  if any, in
all or any  property now or hereafter  securing  any of the  Liabilities  or any
obligation  hereunder,  and permit any  substitution  or  exchange  for any such
property.

                                       1
<PAGE>

         The undersigned hereby expressly waives: (a) notice of the existence or
creation  of all or any of the  Liabilities,  (b)  notice  of any  amendment  or
modification of any of the  instruments or documents  evidencing or securing the
Liabilities,  (c) presentment,  demand,  notice of dishonor and protest, (d) all
diligence in collection or protection of or realization  upon the Liabilities or
any thereof, any obligation hereunder, or any security for any of the foregoing,
and (e) the right to require the Developer to proceed  against  Debtor on any of
the  Liabilities,  though  nothing  herein  shall  prevent  the  Developer  from
proceeding against Debtor on any of the Liabilities.

         In the  event  any  payment  of  Debtor  to the  Developer  is  held to
constitute a preference  under the  bankruptcy  laws, or if for any other reason
the  Developer is required to refund such  payment or pay the amount  thereof to
any other party,  such payment by Debtor to the Developer shall not constitute a
release of Guarantor from any Liability  hereunder,  but Guarantor agrees to pay
such amount to the Developer  upon demand and this Guaranty shall continue to be
effective or shall be reinstated,  as the case may be, to the extent of any such
payment or payments.

         No delay or failure on the part of the Developer in the exercise of any
right or remedy  shall  operate  as a waiver  thereof,  and no single or partial
exercise by the Developer of any right or remedy shall  preclude other or future
exercise thereof or the exercise of any other right or remedy.  No action of the
Developer  permitted  hereunder  shall in any way impair or affect this Guaranty
Agreement. For the purpose of this Guaranty Agreement, the Liabilities of Debtor
to the Developer are guaranteed  notwithstanding any right or power of Debtor or
anyone  else  to  assert  any  claim  or  defense  as  to  the   invalidity   or
unenforceability  of any such  obligation,  and no such claim or  defense  shall
impair or affect the obligations of the undersigned hereunder.

         Any payment from  Guarantor  directly to Developer in  accordance  with
this Agreement shall be classified and booked as a  non-refundable  cost overrun
payment from Guarantor to Debtor in consideration of this Guaranty Agreement and
then a payment by Debtor to Developer in  consideration  of the  Development Fee
Agreement.

         This Guaranty Agreement shall be binding upon the undersigned, and upon
the legal representatives, heirs, successors and assigns of the undersigned, and
may be  enforced  against  them  by the  Debtor  or  Developer  or  their  legal
representatives, heirs, successors and assigns.

         This  Guaranty  Agreement  has been made and  delivered in the state of
Iowa and shall be construed and governed under Iowa law.

         Whenever  possible,  each provision of the Guaranty  Agreement shall be
interpreted  in such manner as to be effective and valid under  applicable  law,
but if any  provision  of this  Guaranty  Agreement  shall be  prohibited  by or

                                       2
<PAGE>

invalid under such law, such  provision  shall be  ineffective  to the extent of
such  prohibition  of  invalidity,  without  invalidating  the remainder of such
provision or the remaining provisions of this Guaranty Agreement.

         Whenever the singular or plural number, masculine or feminine or neuter
is used herein,  it shall  equally  include the other where  applicable.  In the
event this  Guaranty  Agreement  is  executed by more than one  guarantor,  this
Guaranty  Agreement  and the  obligations  hereunder  are the joint and  several
obligation of all the undersigned.

         Guarantor  consents to the  jurisdiction  of the courts in the State of
Iowa and/or to the jurisdiction and venue of any United States District Court in
the State of Iowa having  jurisdiction  over any action or  judicial  proceeding
brought to enforce,  construe or interpret  this Guaranty.  Guarantor  agrees to
stipulate in any such  proceeding that this Guaranty is to be considered for all
purposes to have been executed and delivered within the geographical  boundaries
of the State of Iowa, even if it was, in fact, executed and delivered elsewhere.

         IN WITNESS  WHEREOF, the undersigned have hereunto caused this Guaranty
Agreement to be executed as of _______________________, 2000.

Signed, sealed and delivered                 GUARANTOR:
in the presence of:

----------------------------
Witness

                                             --------------------------
----------------------------                 Lewis F. Weinberg
Notary Public
My Commission Expires:
                                             Address for Guarantor:

----------------------------                 505 5th Street, Suite 238,
(NOTARY SEAL)                                Sioux City, Iowa  51101

                                       3
<PAGE>

                    DEVELOPMENT, RENOVATION, CONSTRUCTION AND
                           OPERATING BUDGET AGREEMENT

         This  Development,   Renovation,   Construction  and  Operating  Budget
Agreement  ("Agreement")  is entered  into as of the date  written  below by and
between Hickory Lane Partners Limited  Partnership,  an Iowa limited Partnership
("Owner"),  Lewis F.  Weinberg,  Weinberg  Investments,  Inc.,  and Sioux  Falls
Environmental Access,  Inc.("General  Partner"), WNC Housing Tax Credit Fund VI,
L.P., Series 7, a California  limited  Partnership  ("Limited  Partner") and WNC
Housing,  L.P., a California  limited  Partnership  ("Special Limited Partner").
Owner, General Partner, Limited Partner and Special Limited Partner collectively
may be  referred to as the  "Parties"  or  individually  may be referred to as a
"Party".

                                    RECITALS

         A.  Owner has  acquired  1.8  acres of land  with a 40-unit  low-income
rental complex already constructed thereon, which the Owner intends to renovate,
located in Sioux City, Woodbury County, Iowa (the "Real Property").

         B. Owner  intends to renovate  the 40 unit  low-income  rental  housing
complex and other related improvements for elderly, which is intended to qualify
for federal low-income housing tax credits (the "Apartment Housing").

         C. On the even date  herewith a  Partnership agreement for Hickory Lane
Partners Limited Partnership  ("Partnership  Agreement") was entered into by and
between  Lewis  F.  Weinberg,  Weinberg  Investments,   Inc.,  and  Sioux  Falls
Environmental  Access,  Inc. as the general  partner  ("General  Partner"),  WNC
Housing  Tax Credit  Fund VI,  L.P.,  Series 7 as the  limited  partner  and WNC
Housing,  L.P. as the special  limited  partner  (the  Partnership  Agreement is
incorporated herein by this reference as if the same were reproduced in full and
any  capitalized  terms not defined in this Agreement  shall have the meaning as
defined in the Partnership Agreement).

         D. The Parties  recognize and acknowledge  that the final  construction
and  renovation  cost  determination  involves   substantial  negotiations  with
lenders, contractors and governmental authorities.

         E. The Parties  recognize and acknowledge that a final operating budget
involves substantial negotiations with lenders and governmental authorities.

         F. Limited Partner's and Special Limited Partner's  decision to execute
the Partnership  Agreement is based, in part, on their acceptance of the sources

                                       1
<PAGE>

of funds available to acquire the Apartment Housing, the cost of construction or
renovation  of the  Apartment  Housing and the  operating  budget  necessary  to
provide a positive Debt Service Coverage.

         Now Therefore,  in consideration of the foregoing  recitals which are a
part of this Agreement,  the mutual promises and undertakings in this Agreement,
and for other good and valuable  consideration,  the receipt and  sufficiency of
which are hereby acknowledged, the Parties agree as follows.

         1. Source of Funds.  Attached  hereto as Exhibit  "A" and  incorporated
herein by this reference is the Apartment Housing Source of Funds. The Source of
Funds have been  specified in the  Partnership  Agreement as the  Mortgage,  the
Capital  Contribution of the General  Partner,  the Capital  Contribution of the
Limited Partner and the Capital  Contribution  of the Special  Limited  Partner.
Unless expressly permitted in the Partnership Agreement,  Consent of the Special
Limited Partner is required for any change to the Source of Funds.

         2. Development Budget.  Attached hereto as Exhibit "B" and incorporated
herein  by this  reference  is the  Development  Budget  in an  amount  equal to
$2,369,600.  Owner  acknowledges  and represents  that the attached  Development
Budget includes the total costs and expenses to acquire,  develop,  renovate and
construct the Real Property and the Apartment Housing.

         3.   Construction   Proforma.   Attached  hereto  as  Exhibit  "C"  and
incorporated  herein  by this  reference  is the  Construction  Proforma.  Owner
acknowledges  and represents  that the attached  Construction  Proforma has been
reviewed by and approved by the Mortgage lender and any governmental authorities
if  applicable.  The  Construction  Proforma  contains a list,  by name,  of all
subcontractors  and material suppliers who will account for more than $25,000 of
the cost of construction or renovation of the Apartment  Housing.  Also included
is a trade  payment  breakdown  specifying  the cost of each  classification  of
construction and renovation  requirements  pursuant to Plans and  Specifications
and the other Project Documents.  In accordance with the Partnership  Agreement,
if the  construction  and  renovation  costs  exceed  the  sum  of  the  Capital
Contributions,  the proceeds of the Mortgage and the Development  Fee,  residual
receipts,  and HUD  supervised  accounts,  then  the  General  Partner  shall be
responsible for and shall be obligated to pay such deficiencies.

         4.  Operating Proforma. Attached hereto as Exhibit "D" and incorporated
herein by this  reference is the  Operating  Proforma.  Owner  acknowledges  and
represents  that  the  attached  Operating  Proforma  has been  reviewed  by and
approved by the Mortgage lender and any governmental authorities if applicable.

         5.  Notices.  Any notice given pursuant to this Agreement may be served
personally  on the Party to be notified,  or may be mailed,  first class postage

                                       2
<PAGE>

prepaid,  to the following address, or to such other address as a Party may from
time to time designate in writing:

   To the General Partner:    Lewis F. Weinberg
                              505 5th Street, Suite 238
                              Sioux City, Iowa  51101

   To the General Partner:    Weinberg Investments, Inc.
                              505 5th Street, Suite 238
                              Sioux City, Iowa  51101

   To the General Partner:    Sioux Falls Environmental Access, Inc.
                              2101 W. 41st St., Suite 220
                              Sioux City, Iowa  57101

   To the Limited Partner:    WNC Housing Tax Credit Fund VI, L.P., Series 7
                              c/o WNC Housing Tax Credit Fund VI, L.P., Series 7
                              3158 Redhill Ave., Suite 120
                              Costa Mesa, CA 92626-3416

   To the Special
   Limited Partner:           WNC Housing, L.P.
                              3158 Redhill Ave., Suite 120
                              Costa Mesa, CA 92626-3416

         6.  Successors and Assigns.  All the terms and conditions of this
Agreement shall be binding upon and inure to the benefit of the  successors and
assigns of the Parties.

         7.   Counterparts.   This   Agreement  may be executed in  one or  more
counterparts,  each of which shall be deemed an original,  and said counterparts
shall  constitute  but one and the same  instrument  which may  sufficiently  be
evidenced by one counterpart.

         8. Captions. Captions to and headings of the Sections of this Agreement
are solely for the  conveniences  of the Parties,  are not a part of this
Agreement, and shall not be used for the interpretation or determination of the
validity of this Agreement or any provision hereof.

         9. Saving Clause. If any provision of this Agreement, or the
application of such  provision  to any  Person  or  circumstance,  shall be held
invalid,  the remainder of this Agreement,  or the application of such provision
to Persons or circumstances  other  than  those as to which it is held  invalid,
shall not be affected thereby.

         10. Governing Law. This Agreement and its application  shall be
governed by the laws of Iowa.

                                       3
<PAGE>

         11.  Attorney's  Fees.  If a suit or action is instituted in connection
with an alleged breach of any provision of this Agreement,  the prevailing Party
shall be entitled to recover,  in addition to costs,  such sums as the court may
adjudge reasonable as attorney's fees, including fees on any appeal.

         In Witness  Whereof,  this  Development,  Renovation,  Construction and
Operating Budget Agreement is made and entered into as of _________, 2000.

                           GENERAL PARTNER

                           Lewis F. Weinberg

                           Weinberg Investments, Inc.

                           By:     ___________________________
                                   Lewis F. Weinberg,
                                   President

                           Sioux Falls Environmental Access, Inc.

                           By:     ___________________________
                                   Rollyn H. Samp,
                                   President

                           LIMITED PARTNER

                           WNC Housing Tax Credit Fund VI, L.P., Series 7

                           By:     WNC & Associates, Inc.,
                                   General Partner

                                   By:      _________________________
                                            David N. Shafer,
                                            Executive Vice President

                           SPECIAL LIMITED PARTNER

                           WNC Housing, L.P.

                           By:     WNC & Associates, Inc.,
                                   General Partner

                                   By:      _______________________________
                                            David N. Shafer,
                                            Executive Vice President

                                       4
<PAGE>

                                    EXHIBIT A

     TO DEVELOPMENT, RENOVATION, CONSTRUCTION AND OPERATING BUDGET AGREEMENT

                                 SOURCE OF FUNDS

                                       A
<PAGE>

                                    EXHIBIT B

     TO DEVELOPMENT,RENOVATION, CONSTRUCTION AND OPERATING BUDGET AGREEMENT

                               DEVELOPMENT BUDGET

                                       B
<PAGE>

                                    EXHIBIT C

      TO DEVELOPMENT,RENOVATION CONSTRUCTION AND OPERATING BUDGET AGREEMENT

                              CONSTRUCTION PROFORMA

                                       C
<PAGE>

                                    EXHIBIT D

     TO DEVELOPMENT, RENOVATION, CONSTRUCTION AND OPERATING BUDGET AGREEMENT

                               OPERATING PROFORMA

                                       D<PAGE>

                                                                     EXHIBIT 4.1

                                 COMMON STOCK

   ---------                                                  --------
     NUMBER                                                    SHARES
      AVG
   ---------                                                  --------
                           [LOGO] AvantGo(TM)

             INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

                                                            CUSIP 05349M 10 0
                                             SEE REVERSE FOR CERTAIN DEFINITIONS

THIS IS TO CERTIFY THAT

is the owner of

fully paid and non-assessable shares, $0.0001 par value, of the COMMON STOCK of
     ___________________________              ___________________________
________________________________ AvantGo, Inc.________________________________
     ___________________________              ___________________________

(hereinafter called the "Corporation"), transferable on the books of the
Corporation in person, or by duly authorized attorney, upon surrender of this
certificate properly endorsed. This certificate is not valid until countersigned
by a Transfer Agent and registered by a Registrar.
     WITNESS the facsimile seal of the Corporation and the facsimile signatures
of its duly authorized officers.

Dated:

COUNTERSIGNED AND REGISTERED:
     CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
          TRANSFER AGENT AND REGISTRAR

BY

                   AUTHORIZED SIGNATURE

       /s/ David Cooper                              /s/ Richard Owen
       CHIEF FINANCIAL OFFICER         [SEAL]        CHIEF EXECUTIVE OFFICER

<PAGE>

                                 AvantGo, Inc.

     THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
REQUESTS, A FULL STATEMENT OF THE DESIGNATIONS, RELATIVE RIGHTS, PREFERENCES AND
LIMITATIONS OF EACH CLASS OF STOCK OR SERIES THEREOF AUTHORIZED TO BE ISSUED AND
THE AUTHORITY OF THE BOARD OF DIRECTORS OF THE CORPORATION TO DESIGNATE AND FIX
THE RELATIVE RIGHTS, PREFERENCES AND LIMITATIONS OF CLASSES OF PREFERRED STOCK
IN SERIES.

     The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

<TABLE>
<S>                                                    <C>
     TEN COM - as tenants in common                    UNIF GIFT MIN ACT-________________Custodian__________________
     TEN ENT - as tenants by the entireties                                   (Cust)                   (Minor)
     JT WROS - as joint tenants with right                             under Uniform Gifts to Minors
               of survivorship and not as                              Act _______________
               tenants in common                                              (State)
</TABLE>

    Additional abbreviations may also be used though not in the above list.

     For value received, _________________________ hereby sell, assign and
transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
     IDENTIFYING NUMBER OF ASSIGNEE
--------------------------------------

_______________________________________________________________________________

_______________________________________________________________________________
   (Please print or typewrite name and address including postal zip code of
                                   assignee)

_______________________________________________________________________________

_______________________________________________________________________________

_________________________________________________________________________Shares

of the Common Stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _____________________________________________

______________________________________________________________________ Attorney
to transfer the said Shares on the Books of the within-named Corporation with
full power of substitution in the premises.

Dated:___________________________________

                                        _______________________________________
                                        NOTICE: The signature to this assignment
                                        must correspond with the name as written
                                        upon the face of the certificate in
                                        every particular, without alteration or
                                        enlargement, or any change whatever.

SIGNATURE(S) GUARANTEED:____________________________________________
                         THE SIGNATURE(S) MUST BE GUARANTEED BY AN
                         ELIGIBLE GUARANTOR INSTITUTION (BANKS,
                         STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS
                         AND CREDIT UNIONS WITH MEMBERSHIP IN AN
                         APPROVED SIGNATURE GUARANTEE MEDALLION
                         PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}]]