Document:

<PAGE>

                                                                   EXHIBIT 10.13

                              Tax Related Agreement

This agreement ("Agreement") is entered into as of March 6, 1998 among CWS
Communities LP, a Delaware limited partnership, the individuals and entities
having executed this Agreement on the signature pages hereto (each, a
"Contributor" and collectively "Contributors"). Each Contributor will have the
rights and obligations of a Contributor set forth herein upon such party's
execution of a counterpart signature page hereto.

Recitals:

     A.   Pursuant to that Contribution Agreement relating to the formation and
          capitalization of CWS Communities Trust of even date herewith among
          Security Capital U.S. Reality, a Luxembourg corporation, Security
          Capital Holdings S.A., a Luxembourg corporation, Clayton, Williams &
          Sherwood, Inc., a California corporation, CWS Communities Trust, a
          Maryland real estate investment trust, Operation Partnership, CWS
          Communities Incorporated, a Delaware corporation, CWS Management
          Services Incorporated, a Delaware corporation and certain individuals
          and entities, including the Contributors, the Contributors have
          contributed to the Operating Partnership certain properties described
          in Schedule A attached hereto (as each is contributed, a "Contributed
          Property, and collectively, the Contributed Properties).

     B.   Contributors and the Operating Partnership desire to enter into this
          Agreement to set forth certain terms and conditions upon which the
          Operating Partnership agrees to hold, encumber and dispose of the
          Contributed Properties.

Agreement:

     1.1  Limitation on Sale of Contributed Property

          (a)  Operating Partnership will not sell, transfer, exchange or
               otherwise dispose of part or all of its interest in any
               Contributed Property during the period (the "Lockout Period")
               commencing, with respect to each Contributed Property, on the
               date such property was contributed to the Operating Partnership
               ("Closing Date") and ending on the tenth (10th) anniversary of
               such date, subject to earlier termination as provided below,
               except in connection with either a like-kind exchange of the
               Contributed Property pursuant to Section 1031 of the Internal
               Revenue Code of 1986, as amended (the "Code") or other
               disposition that pursuant to a nonrecognition provision in the
               Code does not result in the current recognition of any gain to
               the Contributors. Notwithstanding anything to the contrary set
               forth herein, the prohibition against the sale, transfer,
               exchange or other disposition by Operating Partnership with
               respect to any Contributed Property and any obligation in
               subparagraphs (b), (c) and (d) below and in Paragraph 1.2 shall
               automatically terminate in the event that (i) the Contributors at
               any time exercise their right under the Agreement of Limited
               Partnership of the Operating Partnership to exchange, in

<PAGE>

               one or multiple transactions, 95 percent of the total number of
               Units ( as defined in the Contribution Agreement) held by the
               Contributors (the "Contributors' Units") for Class A Shares (as
               defined in the Contribution Agreement), or (ii) the Contributors
               at any time effect a taxable sale, transfer, assignments or other
               disposition of, in one or multiple transactions, 95 percent of
               the Contributors' Units, including an exchange into Class A
               Shares described in clause (i) and upon foreclosure with respect
               thereto (but excluding a pledge or other grant of security
               interest in the Contributors' Units).

          (b)  After the Lockout Period with respect to any Contributed
               Property, the Operating Partnership agrees to use commercially
               reasonable efforts without undue sacrifice to effect any
               disposition of such Contributed Property through a disposition
               pursuant to Section 1031 of the Code or other nonrecognition
               disposition described above. The Operating Partnership shall not
               be bound by the preceding sentence if a suitable exchange
               property is not located and designated by the Operating
               Partnership within 6 months after its determination to attempt to
               dispose of such Contributed Property

          (c)  If the Operating Partnership does not effect a disposition of a
               Contributed Property pursuant to subparagraph (b) above but
               nevertheless intends to dispose of a Contributed Property, then
               the Operating Partnership shall so notify the Contributors in
               writing and the Contributors shall have the right, by written
               notice delivered to the Operating Partnership within 30 days
               after receipt of such notice from the Operating Partnership, to
               exercise their right to redeem the Contributors' Units for such
               Contributed Property in accordance with the following provisions.
               Failure of the Contributors to deliver such notice during the
               30-day period shall be deemed to constitute waiver of this
               redemption right with respect to such Contributed Property. The
               notice given by the Operating Partnership to Contributors shall
               include the sales price that the Operating Partnership intends to
               offer to sell, or to accept an offer to purchase, the Contributed
               Property.

          (d)  If the Contributors elect to exercise their redemption right,
               within 30 days after such election the Operating Partnership
               shall sell and convey the Contributed Property to the
               Contributors in redemption of and exchange for a number of
               Contributors' Units allocated among the Contributors in
               proportion to the number of Units held by each Contributor or as
               they may otherwise agree equal to (i) the offering sales price
               set forth in the notice plus any closing costs incurred by the
               Operating Partnership divided by (ii) the Fair Market Value (as
               defined and determined according to Exhibit N-1 (Loan Agreement)
               to the Contribution Agreement) of a Class A Share as of the date
               of Contributor's election. If the Contributors do not exercise
               their redemption right, then the Operating Partnership may sell
               the Contributed Property free of this redemption right and shall
               have no obligation to renotify Contributors so long as the
               Contributed Property is sold within 9 months after Contributors'
               waiver of their redemption right, for a sales price of no less
               than 95 percent of the offering price, subject to customary
               prorations and adjustments.

     1.2  Debt Guarantee Agreement

<PAGE>

          (a)  From and after the Closing Date of each Contributed Property
               until the 10th anniversary of such Closing Date, Operating
               Partnership agrees that it will keep outstanding in accordance
               with its terms the Existing Debt described in Schedule B,
               attached hereto (or Replacement Financing, if applicable), in the
               principal amount of no less than the amount of the deficit
               balance in the capital accounts (determined in accordance with
               Section 704 of the Code and Treasury Regulations thereunder) of
               Contributors with respect to each Contributed Property plus the
               tax basis of each Contributed Property as of the date of this
               Agreement as set forth in Schedule C as of the Closing (with
               respect to each Contributed Property, the "Guaranteed Amount" and
               collectively the "Guaranteed Amounts") subject to required
               amortization payments under the Existing Debt; provided, however,
               that the foregoing limitation shall not apply if Operating
               Partnership replaces or refinances the Existing Debt with respect
               to such Contributed Property (the "Replacement Financing"), so
               long as the Replacement Financing (i) is for a principal amount
               not less than the outstanding principal balance of the Guaranteed
               Amount with respect to such Contributed Property at the time of
               its replacement, (ii) has an amortization schedule that provides
               for monthly or other periodic repayments of principal in an
               amount equal to or less than the periodic principal payments
               under the amortization schedule for the Existing Debt with
               respect to such Contributed Property in effect as of the Closing
               Date, and (iii) such Replacement Financing with respect to any
               Contributed Property shall constitute "nonrecourse debt" within
               the meaning of Treasury Regulation Section 1.752-1(a)(2)
               allocable to the Contributed Property to the extent of the
               Guaranteed Amount. For purposes of clause (iii) of the preceding
               sentence, the parties agree that any such Replacement Financing
               with respect to any contributed property shall constitute
               "nonrecourse debt" within the meaning of the Treasury Regulation
               Section 1.752-1(a)(2) to the extent of the Guaranteed Amount if
               either (x)(i) the Contributed Property is pledged as security for
               such Replacement Financing, (ii) the product of (a) the
               outstanding amount of any such Replacement Financing and (b) the
               quotient of (I) the fair market value of the Contributed Property
               (reasonably determined by the Operating Partnership) at the time
               of such Replacement Financing to (II) the sum of the fair market
               values of all of the properties (reasonably determined by the
               Operating Partnership) securing such Replacement Financing,
               equals or exceeds the Guaranteed Amount, and (iii) no partner
               (other than the Contributors) bears the economic risk of loss
               with respect to such Replacement Financing, within the meaning of
               Treasury Regulation Section 1.752-2(a) or (y)(1) the Contributed
               Property is pledged as security for such Replacement Financing
               within the meaning of Treasury Regulation Section 1.752-2(a) or
               (y)(i) the Contributed Property is pledged as security for a
               portion of such Replacement Financing, (ii) no other property is
               pledged as security for such portion of such Replacement
               Financing, and (iii) no partner (other than the Contributors)
               bear the economic risk of loss with respect to such Replacement
               Financing within the meaning of Treasury Regulation Section
               1.752-2(a).

     1.3  No Representation with Regard to Tax Treatment

          Notwithstanding any provision of this agreement, neither the Operating
          Partnership nor [CWS Communities Trust] makes any representation
          regarding (and shall have no

<PAGE>

          liability with respect to) the tax consequences to the Contributors of
          the transactions contemplated herein or in any [Related Agreements].

     1.4  Damages

          In the event that Operating Partnership breaches any of its obligation
          set forth in Paragraph 1.1 or Paragraph 1.2 (the "Tax-Related
          Covenants"), the Contributors shall be entitled to receive from the
          Operating Partnership as damages an amount equal to the aggregate
          federal income taxes and state income taxes (at a rate of 6%) incurred
          by the Contributors as a result thereof (and shall not be entitled to
          any "gross-up" with respect thereto). Any such federal and state
          income taxes shall be deemed to the amount of gain or income
          recognized by the Contributors (not in excess of the applicable
          Guaranteed Amount) multiplied by then the highest rate or rates (6% in
          the case of state income taxes) applicable to such gain or income for
          the year in which such gain or income its recognized. No effect shall
          be given in determining the amount of damages to the Contributors of
          their other taxable income, tax deductions, tax credits, tax carry
          forwards nor to any other of their tax benefits or tax attributes.

     1.5  Rights and Remedies of Contributors

          Notwithstanding any provision of this Agreement, Contributors agree
          that the sole and exclusive rights and remedies to which they may be
          entitled at law in equity for a breach of the Tax-Related Covenants by
          the Operating Partnership shall be for damages as determined pursuant
          to Paragraph 1.4, and Contributors shall not be entitled to pursue a
          claim for specific performance of the terms of the Tax-Related
          Covenants. If Contributors notify in writing Operating Partnership of
          a claim that Operating Partnership has breached or violated any of the
          Tax-Related Covenants, Operating Partnership and Contributors agree to
          negotiate in good faith to resolve any disagreements regarding any
          such breach or violation. If any such disagreement cannot be resolved
          by Operating Partnership and Contributors within 30 days after receipt
          by Operating Partnership of the notice in accordance with the
          preceding sentence, Operating Partnership and Contributors shall
          jointly retain a nationally recognized independent public accounting
          firm (an "Accounting Firm") to act as an arbitrator to resolve as
          expeditiously as possible all points of any such disagreement
          (including, without limitation, whether a breach by Operating
          Partnership of any Tax-Related Covenants has occurred and, if so, the
          amount of damages that the Contributors are entitled to as a result
          thereof, determined as set forth in Paragraph 1.4). If the parties
          cannot agree on an Accounting Firm, each of Contributors and Operating
          Partnership shall retain an Accounting Firm, and the Accounting Firm
          selected by Operating Partnership and the Accounting Firm selected by
          Contributors shall jointly retain an Accounting Firm. If the two
          Accounting Firms cannot agree upon a third Accounting Firm within 30
          days, such matter shall be referred to a court of competent
          jurisdiction to select the third Accounting Firm. The Accounting Firms
          shall be instructed to resolve as expeditiously as possible all points
          of any such disagreement (including without limitation, whether a
          breach by Operating Partnership of any Tax-Related Covenants has
          occurred and, if so, the amount of damages that the Contributors are
          entitled to as a result thereof, determined as set forth in Paragraph
          1.4).

<PAGE>

          All determinations made by the Accounting Firm or the Accounting
          Firms, as the case may be, with respect to the resolution of any
          breach or violation of the Tax-Related Covenants shall be final,
          conclusive and binding on Operating Partnership and Contributors. The
          fees and expenses of any Accounting Firms incurred in connection with
          any such determination shall be shared equally by Operating
          Partnership and Contributors. The rights and remedies of Contributors
          set forth in this Paragraph 1.5 shall be available to each Contributor
          individually.

     1.6  Expenses

          Each party hereto shall pay its own expenses incident to this
          Agreement and the transactions contemplated hereunder, including all
          legal and accounting fees and disbursements

     1.7  Assignment

          No party hereto shall assign its rights and/or obligations under this
          Agreement, in whole or in part, whether by operation of law or
          otherwise, without the prior written consent of the other parties
          hereto. Notwithstanding anything to the contrary in the preceding
          sentence, at any time after the Closing Date, Operating Partnership
          may assign its rights and/or obligations under this Agreement to an
          affiliate, or any other person or entity in connection with a merger,
          consolidation, sale or contribution of all or substantially all of its
          assets, or other similar corporate transaction; provided, that no
          assignment pursuant to the preceding clause shall release Operating
          Partnership from its liabilities and obligations hereunder.

     1.8  Entire Agreement, Amendment

          This Agreement, including the Schedules and other documents referred
          to herein or furnished pursuant hereto, together with the Contribution
          Agreement and the exhibits and other documents referred to therein of
          furnished pursuant thereto, constitute the entire agreement among the
          parties hereto with respect to the transactions contemplated herein,
          and supersede all prior oral or written agreements, commitments or
          understandings with respect to the matters provided for herein. No
          amendment, modifications or discharge of this agreement shall be valid
          or binding unless set forth in writing and duly executed and delivered
          by the party against whom enforcement of the amendment, modifications,
          or discharge is sought.

     1.9  Waiver

          No delay or failure on the part of any party hereto in exercising any
          right, power or privilege under the Agreement or under any other
          documents furnished in connection with or pursuant to this Agreement
          shall impair and such right, power or privilege or be construed as a
          waiver of any default or any acquiescence therein. No single or
          partial exercise of any such right, power or privilege shall preclude
          the further exercise of such right, power or privilege, or the
          exercise of any other right, power or privilege. No

<PAGE>

          waiver shall be valid against any part hereto unless made in writing
          and signed by the party against whom enforcement of such waiver is
          sought and then only to the extent expressly specified therein.

     1.10 Severability

          If any part of any provision of this Agreement or any other agreement
          or document gives pursuant to or in connection with this Agreement
          shall be invalid or unenforceable in any respect, such part shall be
          ineffective to the extent of such invalidity or enforceability only,
          without in any way affecting the remaining parts of such provision or
          the remaining provisions of this agreement.

     1.11 Governing Law

          This Agreement, the rights and obligations of the parties hereto, and
          any claim or disputes relating thereto, shall be governed by and
          construed in accordance with the laws of the State of Maryland
          (excluding the choice of law rules thereof).

     1.12 Notices

          All notices, demands, requests, or other communications which may be
          or are required to be given, served, or sent by any party to any party
          pursuant to this Agreement shall be in writing and shall be hand
          delivered, sent by overnight courier or mailed by first-class,
          registered or certified mail, return receipt requested, postage
          prepaid, or transmitted by facsimile, telegram, telecopy or telex,
          addressed as follows:

          (i)  If to any Contributor:

               Clayton, Williams & Sherwood, Inc.
               Attn:      Steven J. Sherwood
                          Byron L. Williams
                          800 Newport Center Drive
                          Newport Beach, CA 92660
               Facsimile: (714) 630-2701

               With a copy to

               Riordon & McKinzie
               Michael P. Whalen
               695 Town Center Drive, Suite 1500
               Costa Mesa, CA 92626
               Facsimile: (714) 549-3244

<PAGE>

          (ii) If to Operating Partnership

               CWS Communities LP
               c/o CWS Communities Trust
               11 South LaSalle Street
               Chicago, IL 60603
               Attn: Caroline S. McBride
               Facsimile: (312) 345-5888

               With copy to:

               Mayer, Brown & Platt
               Attn: William Levy
               190 South LaSalle Street
               Chicago, IL 60603
               Facsimile: (312) 701-7711

          Each additional party may designate by notice in writing a new address
          to which any notice, demand, request or communication may thereafter
          be so given, served or sent. Each notice, demand, request or
          communication which shall be hand delivered, sent, mailed faxed,
          telecopied or telexed in the manner described above, or which shall be
          delivered to a telegraph company, shall be deemed sufficiently given,
          served, sent, received or delivered for all purposes at such time as
          it is delivered to the addressee (with return receipt, the delivery
          receipt, the confirmation receipt (with respect to a facsimile), or
          (with respect to a telecopy or telex) the answerback being deemed
          conclusive, but not exclusive, evidence of such delivery) or at such
          time as delivery is refused by the addressee upon presentation.

     1.13 Headings

          Section headings contained in this Agreement are inserted for
          convenience of reference only, shall not be deemed to be a part of
          this Agreement for any purpose, and shall not in any way define or
          affect the meaning, construction or scope of any of the provisions
          hereof.

     1.14 Execution in Counterparts

          To facilitate execution, this Agreement may be executed in as many
          counterparts as may be required. It shall not be necessary that the
          signature of, or on behalf of, each party, or that the signatures of
          all persons required to bind any party, appear on each counterpart;
          but it shall be sufficient that the signature of, or on behalf of,
          each party, or that the signatures of that persons required to bind
          any party, appear on one or more of the counterparts. All counterparts
          shall collectively constitute a single agreement. It shall not be
          necessary in making proof of this Agreement to produce or account for
          more than

<PAGE>

          a number of counterparts containing the respective signatures of, or
          on behalf of, all of the parties hereto.

     1.15 Attorneys' Fees

          Should either party employ attorneys to enforce any of the provisions
          hereof, the party against whom any final judgment is entered agrees to
          pay the prevailing party all reasonable costs, charges and expenses,
          including reasonable attorneys' fees, expended or incurred by the
          prevailing party in connection therewith.

                                                  {Signature pages to follow}

<PAGE>

                                  CWS COMMUNTITIES LP
                                  By: CWS Communities Trust, Its general partner

                                  By:
                                     -------------------------------------------
                                  Name:
                                       -----------------------------------------
                                  Title:
                                        ----------------------------------------

                                  THE STEVEN SHERWOOD TRUST DATED
                                     SEPTEMBER 8, 1994

                                  By:
                                     -------------------------------------------
                                           Steven J. Sherwood, Trustee

                                  CORAL CAY, LLC

                                  By:
                                     -------------------------------------------
                                       Byron L. Williams, Managing Member

                                  ----------------------------------------------
                                  JAMES L. CLAYTON, INDIVIDUALLY

                                  TANA J. SHERWOOD TRUST DATED
                                  APRIL 9, 1992

                                  By:
                                     -------------------------------------------
                                       Tana J. Sherwood, Turstee

                                  ----------------------------------------------
                                  JOSEPH H. SHERWOOD III, JTWROS

                                  ----------------------------------------------
                                  LAURA G. SHERWOOD, JTWROS

                                  CURTIS LIVING TRUST

                                  By:
                                     -------------------------------------------
                                       Paul D. Curtis, Trustee

                                  By:
                                     -------------------------------------------
                                       Lori E. Curtis, Trustee

                                  WALDO NEIKIRK TRUST U/T/D DATED
                                  JUNE 20, 1994

                                  By:
                                     -------------------------------------------
                                       W. W. Neikirk, Trustee

<PAGE>

                                  KUK FAMILY TRUST

                                  By:
                                     -------------------------------------------
                                       Thomas J. Kuk, Trustee

                                  By:
                                     -------------------------------------------
                                       Ronda R. Blehm-kuk, Trustee

                                  CLAYTON, WILLIAMS & SHERWOOD
                                  FIANACAIL GROUP 80

                                  By:
                                     -------------------------------------------
                                  Name:
                                       -----------------------------------------
                                  Title:
                                        ----------------------------------------

<PAGE>

                                   SCHEDULE A
                             CONTRIBUTED PROPERTIES

Contributed Property
--------------------

Arlington Lakeside

Grand Place

Northwood

Stone Mountain

Woodlands of Kennesaw

<PAGE>

                                   SCHEDULE B
                                  EXISTING DEBT

Contributed Property                    Existing Debt
---------------------                   -------------

Arlington Lakeside                        $3,046,521

Grand Place                               $3,800,840

Woodlands of Kennesaw                     $4,175,940

Stone Mountain                            $4,257,884

Northwood                                 $5,001,032

<PAGE>

                                   SCHEDULE C
                               GUARANTEED AMOUNTS

Contributed Property                    Guaranteed Amounts
---------------------                   ------------------

Arlington Lakeside                          $3,224,464

Grand Place                                 $3,791,840

Woodlands of Kennesaw                       $4,179,304

Stone Mountain                              $4,257,884

Northwood                                   $4,991,250

<PAGE>

                                FIRST SUPPLEMENT
                            TO TAX RELATED AGREEMENT

     THIS FIRST SUPPLEMENT TO TAX RELATED AGREEMENT ("First Supplement") dated
effective as of April 1, 1999, is entered into by CWS COMMUNTIIES LP, a Delaware
limited partnership (the "Operating Partnership"), at the request and for the
benefits of the Contributors (defined below).

                                    RECITALS

          A.   Operating Partnership and various other individuals an entities
               (each a "Contributor") entered into that certain Tax-Related
               Agreement dated March 6, 1998 (the "Tax Related Agreement") All
               initially-capitalized terms not otherwise defined herein shall
               have the meanings set forth in the Tax Related Agreement unless
               the context clearly indicates otherwise.

          B.   Operating Partnership and the Contributors each desire to
               supplement the Tax Related Agreement by adding two properties as
               Contributed Properties.

          NOW THEREFORE, for good and valuable consideration, the receipt and
          sufficiency of which are hereby acknowledge, the undersigned hereby
          agrees as follows:

                                    AGREEMENT

          1.   Supplement to Schedule A to the Tax Related Agreement. Schedule A
               of the Tax Related Agreement is hereby supplemented to include
               the following properties as "Contributed Properties," and the
               Operating Partnership agrees to hold, encumber, and dispose of
               such properties as Contributed Properties according to the terms
               and conditions of the Tax Related Agreement:

               (a)  The manufactured home community commonly known as Oakcrest
                    Point located in San Antonio, Texas; and

               (b)  The manufactured home community commonly known as Misty
                    Winds located in Corpus Christi, Texas.

          2.   Supplement to Schedule B to the Tax Related Agreement. Schedule B
               of the Tax Related Agreement is hereby supplemented to include
               the following existing debt for the new Contributed Properties:

                    Contributed Property:   Existing Debt
                    ---------------------   -------------

                    Oakcrest Point            $4,100,000

                    Misty Winds               $2,700,000

<PAGE>

          3.   Supplement to Schedule C to the Tax Related Agreement. Schedule C
               of the Tax Related Agreement is hereby supplemented to include
               the following guaranteed amounts for the new Contributed
               Properties:

                    Contributed Property:   Guaranteed Amount
                    ---------------------   -----------------

                    Oakcrest Point              $2,000,000

                    Misty Winds                 $1,600,000

          4.   Counterparts. This First Supplement may be executed in any number
               of counterparts, each of which shall be deemed an original, but
               all of which when taken together shall constitute one and the
               same instrument. Each counterpart may be delivered by facsimile
               transmission. The signature page of any counterpart may be
               detached therefrom without impairing the legal effect of the
               signature(s) thereon provided such signature page is attached to
               any other counterpart identical thereto.

<PAGE>

     IN WITNESS WHEREOF, Operating Partnership has executed this First
     Supplement as of the day and year first above written.

                                  CWS COMMUNITIES LP

                                  By: CWS Communities Trust, its general partner

                                  By:
                                     -------------------------------------------
                                  Name: Carl D. Watkins
                                  Title: Vice President<PAGE>

                                                                   Exhibit 10.14

                                 March 6, 1998

Mr. Steven Sherwood
Clayton, Williams &. Sherwood, Inc.
800 Newport Center Drive, Suite 400
Newport Beach, CA

Dear Steven:

          Re: Development Opportunities

     CWS COMMUNITIES LP, a Delaware Limited partnership. (the "Company), has
been formed for the purpose of acquiring, developing and owning manufactured
home communities. Concurrently herewith, you have contributed certain assets to
the Company or its subsidiaries pursuant to a Contribution Agreement dated as of
March 4, 1998 relating to CWS Communities Trust (the "Contribution Agreement),
and the Company has acquired or entered into contracts to acquire certain
manufactured housing communities owned by partnerships in which you have
interests. In addition, you have identified potential opportunities for the
Company (each a "Development Opportunity") with respect to development and
ownership of the following proposed manufactured home communities (each a
"Proposed Community"):

Palm Valley No. 2   3700 Palm Valley Circle, Oviedo, FL
Dessau No.2         508 E. Howard Lane, Austin, TX
North San Antonio   (aka Falcon Bluff) SW, corner of intersection of
                    interstate Hwy 35 and Weiderstein Rd., Guadalupe County. TX
                    (a/ka Marback Oaks) S side of Marback Rd, approximately 2
San Antonio West    miles W of intersection of Interstate Hwy 410 and Marback Rd
                    Bexar Co., Texas

     This letter sets forth certain agreements between the Company and you which
will govern in the event that the Company elects, in its sole discretion, to
pursue a Development Opportunity.

     1. Review Period. The Company shall have a period of 45 days in which to
evaluate a Development Opportunity after your submission of a preliminary
investment memo and all required supporting information with respect to such
Development Opportunity in accordance with the Company's Standard investment
committee procedures and requirements. If the Company does not notify you in
writing within such period of its interest in pursuing such Development
Opportunity or does not acquire the applicable project within 45 days after
giving such notice, subject to extension for so long as the Company is
negotiating a Purchase Contract or assumption thereof in good faith with any
third party seller or if the conditions precedent to closing there under have
not been satisfied, the Company shall be deemed to have elected not to pursue
such Development Opportunity and nothing herein or in that certain
Noncompetition and Confidentiality Agreement, dated the date hereof, between you
and CWS Communities Trust shall be deemed to prohibit or restrict you from
pursuing such Development Opportunity yourself nor shall pursuing such
Development Opportunity be deemed to be a breach of any duty that you owe to the
CWS Communities Trust by reason of being an employee or trustee of CWS
Communities Trust.

<PAGE>

     2. Funding of Costs. The Company will not be required to advance any costs
with respect to a Development Opportunity until the Company has entered into (or
assumed with the consent of the seller) an agreement ("Purchase Contract")
either with the owner thereof to purchase the land upon which the Proposed
Community will be developed, or with such Owner or another party to jointly
develop such land. Prior to such time, pursuit of such Development Opportunity
shall be at your expense. At closing of the purchase by the Company of any such
land, the Company will reimburse you for out-of-pocket expenses incurred by you
in pursuing such Development Opportunity, subject to any mutually agreed
pre-development expense budget.

     3. Contract Conditions. The purchase price and terms and conditions of any
Purchase Contract must be satisfactory to the Company in its sole discretion.
Generally, the Company will not "go hard" with respect to any Proposed Community
until due diligence has been completed and entitlements have been obtained.

     4. Dessau. (a) With respect to Dessau No. 2, to the extent that the
purchase price payable by the Company for the undeveloped land is less than the
product of $3,500 and the number of projected spaces to be developed on the
land, the Company will pay the balance to you for the value of the opportunities
provided upon the later of (i) closing or (ii) satisfaction of the Development
Approvals Contingency (defined below).

          (b) The parties contemplate that development of Dessau No. 2 will
include creation of an outlot parcel to be sold at a future date to a commercial
or retail user or developer. The Company agrees to use commercially reasonable
efforts to cause such outlot to be created as a separate legal lot. In the event
that such outlot parcel is created and sold by the Company, upon sale thereof
the Company will pay to you an amount equal to 50% of the amount, if any, by
which the net sales proceeds received by the Company in consideration for such
sale (net of all commissions, adjustments and transaction costs payable by the
Company, including reasonable attorney's fees) exceed the Company's Adjusted
Cost with respect to such outlot. "Adjusted Cost" means all costs incurred by
the Company to create and prepare the outlot parcel for sale, determined in
accordance with the Company's standard underwriting and accounting procedures,
including imputed interest on Company's capital until sale at the rate of 9% per
annum. Adjusted Cost shall include all costs of subdividing the outlot parcel
(including legal costs), and any costs of infrastructure, landscaping or other
improvements made solely for the benefit of the outlot parcel. Adjusted Costs
shall not include any costs of utilities, infrastructure, landscaping and other
improvements which benefit both the outlot parcel and the Proposed Community,
any costs of acquisition of the Dessau II land or any costs associated with use
of the outlot parcel prior to sale for purposes solely related to the
development and marketing of the Proposed Community, such as costs of temporary
use of the outlot parcel for installation and display of model homes.

          (c) In the event that such outlot parcel is created but has not been
sold by the Company by the date which is 7 years after the closing of the
acquisition of the Dessau No. 2 property, you shall have the one time right to
receive the payment which would otherwise be payable to you upon sale of the
outlot, based upon a deemed sale at its then Fair Market Value, "Fair Market
Value" shall mean, the then fair market value of the outlot, taking into account
its highest and best use in light of surrounding uses, then applicable market
factors and use restrictions under applicable laws and ordinances. Within 30
days after the seventh anniversary of the Company's acquisition of the property,
the Company shall notify you in writing (a "Valuation Notice") of its proposal
as to Fair Market Value of the outlot, which value shall be determined in the
Company's reasonable discretion. If you dispute the Company's proposed value,
you must so notify the Company in writing within 10 days after your receipt of
the Valuation Notice. Failure to respond within such 10-day period shall
constitute your acceptance of such Fair Market Value. If you object to The
Company's proposed value (or following written notice from you if the Company
fails to deliver the Valuation Notice within the time required), the Company
will endeavor, in good faith, to reach agreement with you as to Fair Market
Value. If the parties acting in good faith cannot agree upon Fair Market Value
within 30 days after your notice that you dispute the Company's proposed value
(or your notice that the Company has failed to give the Valuation Notice, as
applicable), either party may invoke the appraisal procedure provided in
subparagraph (d) below to determine Fair Market Value. Upon determination of
Fair Market Value either as provided above or pursuant to paragraph (d), you
must elect either to (i) receive payment as provided in this paragraph based

<PAGE>

upon such Fair Market Value, or (ii) waive your rights to payment under this
paragraph (but in such event your right to receive payment under subparagraph
(b) if and when the outlot is sold shall continue.) At any time after
determination of Fair Market Value hereunder, the Company may request by written
notice that you make such election, and your failure to respond in writing
within 10 days after such written request from the Company shall be deemed to be
an election to waive your rights to payment under this paragraph (c).

          (d) Either party may elect to cause the outlot to be appraised as
provided herein by sending written notice to the other party within 5 days after
the 30-day negotiating period provided in Paragraph (c). The appraisal shall be
performed by a commercial real estate appraiser with experience in the Austin,
Texas market, mutually satisfactory to both parties. If the parties are not able
to agree upon an appraiser within 15 days after invocation of this appraisal
procedure, then either party may propose a list of no less than three such
appraisers acceptable to it, and the other party shall select an appraiser from
such list. If the parties fail to agree upon an appraiser within 30 days after
invocation of these appraisal procedures than the appraiser shall be selected in
accordance with the commercial arbitration rules of the American Arbitration
Association. Upon selection of the appraiser, each party shall submit to the
appraiser its proposal as to Fair Market Value. The appraiser shall select from
the two proposed values the one which the appraiser believes is most reflective
of the fair market value of the property. The appraiser must choose between the
two proposals and may not compromise between the two or select some other
amount. The cost of the appraisal shall be paid by the Company if the appraiser
chooses your proposal, and you shall pay the cost of the appraisal if the
appraiser chooses the Company's proposal.

          (e) If the Development Approvals Contingency is not satisfied and the
Company does not proceed with development of the Proposed Community, no payment
shall be due with respect to Dessau No. 2 under Paragraphs 4(a), 4(b) or 7. In
such event, the Company shall use reasonable efforts to sell the Dessau No. 2
Land for a commercially reasonable market price, provided that such sale may be
contingent upon the Company's ability to exchange the property through a 1031
exchange. Upon such sale or exchange, the Company shall pay to you an amount
equal to 50% of the amount, if any, by which the net proceeds received by the
Company in consideration for such sale (net of all commissions, adjustments and
transaction costs payable by the Company, including reasonable attorney's fees)
exceed the Company's Total Cost with respect to the Dessau No. 2 Land. "Total
Cost" means all costs incurred by the Company in connection with (i) the
acquisition of the property; (ii) the effort to obtain Development Approvals;
(iii) the ownership of the property, including real estate taxes and insurance
costs; and (iv) preparation of the property for sale. Total Cost shall be
determined in accordance with the Company's standard underwriting and accounting
procedures, and shall include imputed interest on Company capital until sale at
the rate of 9% per annum. In the event that portions of the property are sold in
separate transactions, the provisions of this subparagraph shall apply with
respect to each such sale, and for purposes of determining the amount payable to
you in connection with each sale, Total Cost shall be allocated pro rata based
on acreage.

          (f) As used in this Paragraph 4, "Development Approvals" means all
necessary governmental and private approvals and permits required in connection
with the development on the Dessau No. 2 property of a manufactured home
community having not less than 300 lots or pad sites, or such lesser number as
the Company's investment committee may approve, (the "Proposed Project);
excluding building permits but including each of the following: a site
development permit; all state and local governmental approvals necessary to
permit extension of water and sanitary sewer services to the Dessau No. 2
property in sufficient capacity to serve the proposed community; and to the
extent required by the City of Austin, final zoning, platting, and signage
approvals. As used in this Paragraph 4, "Development Approvals Contingency"
means (i) receipt of all Development Approvals, without conditions or
restrictions (including the payment of assessments or the posting of security)
that render the Proposed Project unacceptable to Operating Partnership, as
determined by Operating Partnership in its sole discretion, and (ii) expiration
of all appeal periods with respect to the Development Approvals without any
appeal having been filed or, if filed, such appeal shall have been resolved to
the satisfaction of Purchaser.

     5. Palm Valley. With respect to Palm Valley No. 2, to the extent that the
purchase price payable by the Company for the undeveloped land is less than the
product of $10,000 and the number of projected spaces to be developed on the
land, the Company will pay the balance to you at closing as a fee. In addition,

<PAGE>

to the extent the Company adds spaces at Palm Valley No. 1 on land made
available for such purpose as a result of reconfiguring the sewer system at Palm
Valley No. 1 to make use of components at Palm Valley No. 2, up to a maximum of
20 of such added lots will be deemed to be part of Palm Valley No. 2 for
purposes of the calculating (i) the payment due to you at closing as provided
above and (ii) the earnout payable at stabilization as provided below.

     6. San Antonio West. This Proposed Community may be developed in multiple
phases, with a total of approximately 700 to 800 spaces, assuming that all
phases are purchased and developed by the Company. A portion of the site is now
owned by Sherwood Newport Capital Group, a company in which you are the
principal ("SNCG"). SNCG has contractual rights to acquire the balance of the
site. The Company understands that if the Company proceeds with this Proposed
Community, it is your intention to retain approximately 20 acres of the land now
owned by SNCG for commercial development and to transfer the balance of SNCG's
land and option rights to the Company through a merger. The following provisions
shall apply with respect to San Antonio West:

     (i)  The purchase price or contribution value for each phase will be
          $3,250.00 per projected pad site (whether single wide or double wide);
          provided that as to any phases which have not yet been acquired, such
          price will be increased by 3 1/2% per annum commencing on March 1,
          1999 and on each March 1st thereafter. If the Company purchases any of
          the option property directly from the owner thereof, to the extent
          that the purchase price payable by the Company for the undeveloped
          land is less than the product of the price per pad stated above and
          the number of projected pad sites to be developed on such land, the
          Company will pay the balance to you at closing for the value of the
          opportunities provided.

     (ii) The phase I and II land will be acquired at the same time. The Company
          will have a 48 month option to purchase the remaining phases
          commencing upon closing of the acquisition of phases I and II. To the
          extent permitted by the terms of the option, the Company may purchase
          the remainder of the property in up to 3 additional phases (phases
          III, IV and V); provided that upon purchase of Phase III the option
          shall become an a purchase agreement with respect to phases IV and V
          (meaning that the Company shall be obligated thereafter to proceed
          with the purchase of phases IV and V, subject to such closing
          conditions as may be agreed upon prior to closing of phase III).

     (iii) It shall be a condition to this transaction that we have agreed upon
          a value for the infrastructure improvements already in place on the
          land, and an allocation of such value to each phase which includes any
          such improvements. The agreed value of improvements on any phase shall
          be paid to you at the closing of acquisition of such phase. Until
          closing of the applicable phase, such agreed amount will be increased
          by 3 1/2% per annum commencing on March 1, 1999 and on each March 1st
          thereafter.

     (iv) The earnout will be calculated for each phase (for such purposes phase
          1 and 2 are treated as one phase) and when all phases have been
          developed and the final earnout is triggered, for all phases taken as
          a whole. The earnout provisions shall be triggered upon reaching 95%
          aggregate actual occupancy for all previous phases taken as a whole
          (including the phase for which the earnout is being calculated). When
          the earnout is calculated for each phase, revenues will be based upon
          gross potential revenue at 95% economic occupancy in such phase at the
          then current average revenue rate per occupied pad, and operating
          expenses will be based upon then current average operating expenses
          per pad (occupied or unoccupied) for the entire community. Any Project
          Costs which cannot be specifically allocated to a particular phase
          shall be allocated based on the average of such total costs per
          developed pad site (including unoccupied sites), multiplied by the
          total number of pads within the applicable phase. When 95% aggregate
          actual occupancy has been achieved for all phases, taken as a whole, a
          final earnout calculation and payment shall be made with respect to
          all phases taken as a whole. Revenues for all previous phases for
          purpose of the final earnout payment shall be the sum of the revenues
          used in the original calculation, (i.e.,

<PAGE>

          revenues will not be current revenues) and revenues for the final
          phase shall be calculated at the then current average revenue rate per
          occupied pad. Operating expenses for the final calculation will be the
          then current average operating expenses per pad (occupied or
          unoccupied) for the entire community. The final payment shall equal
          the excess of the calculation for the phases taken as a whole over the
          sum of all previous earnout payments.

     7. Earnout. For each Proposed Community acquired and developed by the
Company, in consideration for your efforts to pursue such Development
Opportunity and obtain entitlements therefore, the Company will pay you an
earnout fee upon Stabilization equal to 50% of the amount, if any, by which
Stabilized NOI, capitalized at 9%, exceeds Total Project Cost. As used in this
letter, the following terms shall have the meanings set forth below:

          "Stabilization" means the earlier of (i) the date upon which the
     Proposed Community reaches 95% occupancy, or (ii) the date which is 5 years
     after acquisition of the site (4 years in the case of Palm Valley No. 2).

          "Stabilized NOI" means a static measurement of annual net operating
     income at Stabilization based upon annualized revenues from leases in place
     at Stabilization (including both rent and service income) less total
     estimated annual operating expenses not recoverable from tenants, including
     the following:

          (i)  an assumed annual management fee equal to 3% of gross revenues
               plus reimbursables (since the Company will self-manage its
               properties);

          (ii) tenant incentive expenses based on an assumed turn-over rate of
               10% per year and an annualized average of move-in incentives per
               pad site based upon the incentives actually paid or credited to
               tenants or dealers during the 6 months preceding Stabilization;

          (iii) marketing and advertising expenses but not to exceed $400 per
               month; and

          (iv) annual real estate taxes and assessments for the Proposed
               Community based on the most recent assessed values and levy
               rates.

     Estimated annual operating expenses shall not include costs of any
     employees other than those employed from and after Stabilization for
     on-going management, maintenance and leasing. For purposes hereof, utility
     and other expenses shall not be included in annual operating expenses to
     the extent that such expenses are paid by tenants, and collections from
     tenants for such pass-through expenses shall not be included in revenues.
     Stabilized NOI shall be calculated by multiplying such annualized revenues
     and expenses for the first month following Stabilization by 12.

          "Total Project Cost" means the total costs incurred by the Company to
     acquire and develop the Proposed Community, determined in accordance with
     the Company's standard underwriting and accounting procedures, including
     imputed interest on Company capital until Stabilization at the rate of 9%
     per annum, and an allocations of 1% of the Total Project Cost for overhead
     and administrative costs. Imputed interest will be reduced by the net
     operating income of the Proposed Community for the period over which
     imputed interest is calculated.

For purposes of calculating your earn-out under the first sentence of this
paragraph 5, if the Proposed Community is owned in a joint venture or
partnership with unrelated parties, Stabilized NOI shall be adjusted to include
only the portion thereof distributable to the Company in the ordinary course in
any year (taking into account the annualized effect of any preferences) and
Total Project Cost shall be the portion of such costs contributed or incurred by
the Company.

<PAGE>

     8. Payment in Units/shares. You may elect to receive any of the: amounts
due hereunder with respect to any Proposed Community in the form of Units in the
Company or shares (as applicable at the time) in exchange for contribution by
you of your property or contract rights with respect to such Proposed Community;
provided that you must make such election with respect to any Proposed Community
prior to execution of definitive agreements by the Company with respect to
acquisition of such Proposed Community. Units/shares to be paid at closing (or
upon receipt of Development Approvals, as applicable) with respect to Dessau No.
2 and phases I and II of San Antonio West will be valued at $10.00 per
Unit/share. In all other cases (including payments at stabilization of Dessau
No. 2 and San Antonio West phases I and II, and payment upon sale of an outlot
parcel or undeveloped land at Dessau No.2, if any), Units/shares will be valued
at the "Current Fair Market Value" (as defined in the Sherwood Loan Agreement
referred to in the Contribution Agreement) as applicable at (i) the closing date
of the acquisition by the Company of a Proposed Community, in the case of
amounts payable to you at such acquisition, or (ii) at the Stabilization Date in
the case of earnout amounts payable to you at Stabilization of a Proposed
Community or phase, as applicable. Any Units/shares issued pursuant to this
Agreement shall not be deemed to have been issued pursuant to the Contribution
Agreement. The put option set forth in the Shareholders Agreement referred to in
the Contribution Agreement shall not apply with respect to any Units/shares
issued to you pursuant to this Agreement. You may elect to contribute your
interests with respect to any Development Opportunity through the Steven
Sherwood Trust, established September 8, 1994, or through any other entity in
which you have an interest and which is a limited partner of the Company or
which satisfies the requirements for admission as a limited partner pursuant to
the provisions of the agreement of limited partnership of the Company. In such
event, any units to which you are entitled hereunder with respect to such
contribution shall be issued to such contributing entity.

     9. Entire Agreement. This letter constitutes the complete agreement of the
parties with respect to the subject matter hereof. Nothing in this letter shall
be deemed to create any obligation or agreement with respect to any manufactured
home communities or other properties other than the Development Opportunities
expressly described in this letter.

     10. Execution in Counterparts and by Facsimile. This letter may be executed
in multiple counterparts and by each party on separate counterparts, and all
such counterparts shall constitute one and the same instrument. To facilitate
execution of this letter, the parties may deliver signature pages by facsimile
transmission and such facsimile signature pages shall have the same force and
effect as an original.

                         [Signatures on following page]

<PAGE>

     If the terms of this letter are acceptable, please sign in the space
provided below.

                                     Sincerely,

                                     CWS Communities LP

                                     By: CWS Communities Trust
                                         a Maryland real estate investment trust
                                         its general partner

                                         By:
                                             -----------------------------------

                                         Name:

                                         Title:

Accepted and agreed to:

/s/ Steven J Sherwood
---------------------------
Steven J. Sherwood

<PAGE>

                                December 8, 2002

Mr. Steven Sherwood
Clayton, Williams & Sherwood, Inc.
800 Newport Center Drive, Suite 400
Newport Beach, California 92660

     Re: Amendment to Development Opportunities Letter Dated March 6, 1998

Dear Steven:

     This letter amends that letter dated March 6, 1998 between us related to
development opportunities as follows. The initially capitalized terms used here
shall have the same definitions as in the March 6, 1998 letter. The reference to
paragraph numbers are to those in the March 6, 1998 letter.

     The Development Approvals Contingency has been satisfied with respect to
the property known as Dessau No. 2. The Company shall have discretion to
determine if, and when, Dessau No. 2 is to be developed or marketed for sale
and, in connection therewith, whether to create the outlet parcel, as referred
to therein as a separate legal lot. If the outlet parcel is created and sold to
a commercial or retail user, then you will be paid with respect to the outlet
parcel in accordance with paragraph 4(b), and if it is created but not sold,
then you will be paid according to paragraph 4(c) [however, the 7 year period
referred to therein as ending after the closing of the acquisition of Dessau No.
2 shall instead be the 7 year period ending after the commencement of the
development of Dessau No. 2. The obligations of the Company under paragraphs
4(e) and 7 shall likewise, remain in effect subject to the amendment to the
definition of the term, "Stabilization", which for purposes of Dessau No. 2 only
is amended to mean the earlier of (i) the date upon which Dessau No. 2 reaches
95% occupancy or (ii) the date which is five years after commencement of
development of Dessau No. 2.

                                    Sincerely,

                                    CWS COMMUNITIES LP

                                    By: CWS COMMUNITIES TRUST,
                                        a Maryland real estate Investment trust,
                                        its general partner

                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:

<PAGE>

                               HOLDBACK AGREEMENT
                                  (PALM VALLEY)

     This Holdback Agreement (this "Agreement") is entered into as of August 30,
1999 by and between Alafaya Palm Valley Associates. Ltd., a California limited
partnership ("Owner") and CWS Communities LP, a Delaware limited partnership
("Operating Partnership"). .

                                    RECITALS

     A. Owner and Operating Partnership have heretofore entered into that
certain Real Estate Exchange and Contribution Agreement (Palm Valley) dated as
of March 6, 1998, and subsequently amended (as so amended, the "Exchange
Agreement"), regarding the exchange and contribution of a certain manufactured
home community commonly known as Palm Valley located on parcel(s) of real
property (collectively, the "Real Property") in Oviedo, Florida, which Real
Property together with all improvements thereon and other rights, benefits,
privileges, easements and appurtenances thereon or in any way appertaining is
defined in the Agreement at the "Property".

     B. The Property is served by a private sewer treatment plant (the "Plant").
Certain modifications are required with respect to the Plant in order to bring
the effluent disposal system of the Plant into compliance with requirements of
the State of Florida.

     C. The Property is subject to existing mortgage financing (the "Loan")
which will be assumed by Operating Partnership as provided in the Agreement. As
a condition to such assumption, the holder of the Loan requires that funds be
escrowed (the "Escrow") with Lender or its agent ("Agent") to cover the cost of
the Disposal System Modifications.

     NOW, THEREFORE, in consideration of the mutual covenants and benefits
herein contained and for ten dollars and other good and valuable consideration,
the parties hereto agree as follows:

     1. Defined terms used in this Agreement shall have the same meanings as set
forth in the Exchange Agreement, except as specifically defined in this
Agreement or if context clearly indicates a different meaning is intended. '

     2. As used herein, "Disposal System Costs'" means the costs of
modifications to the Plant's disposal system to the extent required to satisfy
the State of Florida including engineering fees and costs, costs imposed by the
State in connection therewith for inspections, plans review, permits or other
items, and the cost of modifying the effluent disposal system and expanding the
leach fields to satisfy the State's requirements. Disposal System Costs shall
not include any costs of expanding the capacity of the Plant to serve additional
phases. In addition, in the event of any such expansion, any Disposal System
Costs which are for the benefit of both the existing Property and such
additional phases shall be allocated pro rata to the Property in the proportion
that the number of pad sites in the existing Property bears to the total number
of pad sites in both the existing Property and such expansion phases. Operating
Partnership agrees to consult with Steven Sherwood, as the representative of
Owner, with respect to the proposed disposal system modifications and Disposal
System Costs shall be subject to the reasonable approval of Steven Sherwood on
behalf of the Owner.

     3. Owner and Operating Partnership hereby agree (a) that the Contribution
Value under the Exchange Agreement shall be reduced by the sum of $150,000, in
partial compensation to Operating Partnership for the Property's pro rata share
of Disposal System Costs; and (b) the additional sum of $150,000 shall be held
back from the proceeds due to Owner at Closing and deposited into escrow with

<PAGE>

Agent in accordance with a separate escrow agreement between Agent and Operating
Partnership. To the extent that Agent requires that funds be escrowed in excess
of $150,000, such funds shall be deposited by Operating Partnership.

     4. The first $150,000 of the Property's pro rata share of Disposal System
Costs shall be paid from funds provided by Operating Partnership, due to the
reduction of the Contribution Value hereunder. Owner's funds in the escrow shall
be applied to pay and reimburse the Property's pro rata share of Disposal System
Costs after the first $150,000 of such pro rata costs. Any interest earned on
the funds in the Escrow shall be allocated in accordance with the deemed
balances of Owner's and Operating Partnership's portions of the funds, as
provided herein.

     5. To the extent that the Property's pro rata share of Disposal System
Costs is less than $300,000 after completion of the modifications and acceptance
of such modifications by all applicable governmental agencies and by Agent, then
Owner shall be entitled to a refund from the escrow in the amount of such
difference and Operating Partnership shall cause such amount to be released to
Owner from the escrow or shall otherwise pay such amount to Owner.

     6. Except for reduction of the Contribution Value and payment of costs from
Owner's funds to the extent provided herein, Owner shall have no obligation or
liability to Operating Partnership with respect to the Plant or the Disposal
System Costs, and Operating Partnership hereby waives and releases any such
other obligation or claim.

     7. If any suit is filed to enforce the terms hereof, the prevailing party
shall be entitled to recover all reasonable attorney's fees incurred.

     8. This Agreement shall be binding upon the parties hereto and their
respective successors and assigns.

     9. This Agreement may be executed in any number of counterparts, and by
each party hereto on separate counterparts, and all such counterparts shall
together constitute one and the same instrument.

                               [Signatures follow]

<PAGE>

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Amendment on the day and year first above written.

                                    OWNER

                                    ALAFAYA PALM VALLEY ASSOCIATES, LTD.
                                    a California limited partnership

                                    By: Clayton, Williams & Sherwood Financial
                                    Group 81, a California corporation,
                                    its general partner

                                    By: /s/ Steven J. Sherwood
                                        ----------------------------------------
                                    Name: Steven J. Sherwood

                                    Title: CFO/Secretary

                                    OPERATING PARTNERSHIP:

                                    CWS COMMUNITIES LP, a Deleware limited
                                    partnership

                                    By: CWS Communities Trust, a Maryland real
                                    estate investment trust, its general partner

                                    By: /s/ Donald Myers
                                        ----------------------------------------
                                    Donald Myers, Senior Vice President

<PAGE>

                                September 1, 2000

Mr. Steven J. Sherwood
Clayton, Williams & Sherwood, Inc.
800 Newport Center Drive, Suite 400
Newport Beach, CA

Dear Steve:

         Re: Development Opportunities Letter Agreement dated March 6. 1998
             --------------------------------------------------------------

         Reference is made to the letter agreement regarding Development
Opportunities between CWS COMMUNITIES LP, a Delaware limited partnership, (the
"Company") and Steven Sherwood (the "Development Opportunities Agreement") (copy
attached as Exhibit A). Reference is also made to the Holdback Agreement (Palm
Valley) entered into between the Company and Alafaya Palm Valley Associates,
Ltd. ("Seller"), dated as of August 30, 1999 (the "Sewer Holdback Agreement")
(copy attached as Exhibit B).

         We have agreed to modify the terms of the Development Opportunities
Agreement with respect to Palm Valley No. 2 as follows:

1.       The payment to be made pursuant to the first sentence of Paragraph 5 of
         the Development Opportunities Agreement shall be paid 1/2 at closing
         and the balance shall be deferred as provided below. Accordingly, the
         first sentence of such Paragraph 5 is modified to read:

                  "With respect to Palm Valley No. 2, to the extent that the
                  purchase price payable by the Company for the undeveloped land
                  is less than the product of $10,000 and the number of
                  projected spaces to be developed on the land, the Company will
                  pay the difference to you as a fee as follows: (a) 1/2 at
                  closing; (b) 1/4 on the date which is 42 months after closing
                  (assuming that the balance has not been paid earlier as
                  provided in below); and (c) the remaining balance (either 1/2
                  or 1/4 as applicable) upon receipt by the Company of total net
                  operating income from Palm Valley No. 2 constituting a 9%
                  annual return on Total Project Cost for Palm Valley No. 2 (the
                  "Payment Condition")."

2.       For purposes of determining whether the Payment Condition has been met
         (but not for purposes of calculating the earnout fee under paragraph 7
         of the Development Opportunities Agreement):

         (a)      The parties agree to use a deemed operating expense ratio of
                  23.7%. Thus for such calculation only, net operating income
                  for Palm Valley No. 2 shall be deemed to be 76.3% of actual
                  gross operating income (but such deemed expense ratio shall
                  not apply for any other purpose under the Development
                  Opportunities Agreement).

         (b)      Cost of capital included in Total Project Cost shall be deemed
                  to be 8.5% (instead of 9%) and shall be offset by net
                  operating income received during the lease-up period prior to
                  Stabilization;

         (c)      Total Project Cost shall not include the 1% allocation for
                  deemed overhead and administrative expenses; and

         (d)      Total Project Cost shall not include any "Disposal System
                  Costs", as such term is defined in the Holdback Agreement.

3.       For purposes of calculating the earnout fee with respect to Palm Valley
         No. 2 under paragraph 7 of

<PAGE>

         the Development Opportunities Agreement, Total Project Cost shall
         include all "Disposal System Costs" (as defined in the Sewer Holdback
         Agreement), less the portion of such Disposal System Costs credited
         against the purchase price for the existing Palm Valley community
         ($150,000) or funded from the funds held back from the purchase price
         under the Sewer Holdback Agreement (up to an additional $150,000);
         provided that the amount of Disposal System Costs included in Total
         Project Cost (being the portion of such costs in excess of such credit
         and holdback) shall not exceed $480,000 ($780,000 before application of
         the credit and holdback). For example, if total Disposal System Costs
         are $700,000, the amount to be included in Total Project Cost shall be
         $400,000 ($700,000 - $150,000 credit - $ 150,000 holdback). But if
         total Disposal System Costs are $800,000, of the $500,000 of such costs
         in excess of the credit and holdback, only $480,000 shall be included
         in Total Project Cost.

         Except as modified by this letter, the Development Opportunities
Agreement shall remain in full force and effect.

         This letter may be executed in multiple counterparts and by each party
on separate counterparts, and all such counterparts shall constitute one and the
same instrument. To facilitate execution of this letter, the parties may deliver
signature pages by facsimile transmission and such facsimile signature pages
shall have the same force and effect as an original.

                         [Signatures on following page}

<PAGE>

If the terms of this letter are acceptable, please sign in the space provided
below.

                                     Sincerely,

                                     CWS Communities LP

                                     By: CWS Communities Trust
                                         a Maryland real estate investment trust
                                         its general partner

                                         By:     /s/ Teresa L. Corral

                                         Name:   Teresa L. Corral

                                         Title:  Vice President

Accepted and agreed to:

/s/ Steven J Sherwood
----------------------------
Steven J. Sherwood

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00050-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00050-of-00352.parquet"}]]