SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



                                    FORM 8-K

                                 CURRENT REPORT
                     PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934



                               September 30, 1999
                Date of Report (Date of earliest event reported)


                         MUNICIPAL MORTGAGE & EQUITY, LLC
             (Exact Name of Registrant as Specified in its Charter)



    Delaware               001-11981                      52-1449733
 (State or Other     (Commission File Number)  (IRS Employer Identification No.)
 Jurisdiction of
  Incorporation)




                       218 North Charles Street, Suite 500
                            Baltimore, Maryland 21201
               (Address of Principal Executive Office) (Zip Code)


                                 (410) 962-8044
              (Registrant's telephone number, including area code)





<PAGE>



Item 5. Other Events.

(a)      On September 30, 1999,  Municipal  Mortgage & Equity, LLC  ("MuniMae")
         agreed to acquire 100% of the capital stock of Midland Financial
         Holdings,  Inc. ("Midland"),  a Florida corporation,  from Messrs.
         Robert Banks, Keith Gloekl and Ray Mathis,  for up to $45  million.  Of
         this  amount,  $23 million in cash and $12 million in MuniMae  common
         shares  will  be  paid  at  the  closing  of  the  transaction,
         respectively, subject  to  certain  post-closing adjustments, and $3.33
         million in MuniMae  common shares is payable annually over a three year
         period if Midland meets certain performance  targets,  including an
         annual contribution to CAD of at least $6.0 million in year one, $6.25
         million in year two and $6.5 million in year three.  MuniMae expects to
         close this  transaction  by the end of  October  1999,  subject  to
         regulatory approvals, the expiration  of  notice  periods  and  certain
         other conditions.  MuniMae expects to fund the $23 million up-front
         payment from its working capital.

         Midland is a fully integrated real estate  investment firm specializing
         in  providing  debt  and  equity  capital  to the  multifamily  housing
         industry,  particularly in the area of affordable housing.  Since 1977,
         Midland  has  originated  $2.6  billion in  financing  for  multifamily
         housing. Midland currently has approximately $225 million of assets, of
         which  98%  represents   construction   loans,   and  $217  million  of
         liabilities of which 98% represents  Notes  Payable.  Midland  operates
         primarily in the following related areas:

          o   Commercial  Mortgage  Banking.  Midland provides  construction and
              permanent debt financing,  mortgage servicing and asset management
              services to the multifamily housing industry.  Midland is a Fannie
              Mae DUS lender and a FHA approved mortgagee.
<TABLE>
<CAPTION>

         Midland's Portfolio (in 000's)
          <S>                                                             <C>

         Construction Loans Outstanding:
                  Construction loans for own account                   $  85,212
                  Construction loans for which risk is indemnified
                           by a third party*                           $ 136,060
                                                                       ---------
                  Total Construction Loans Outstanding                 $ 221,272
                                                                       =========

         Permanent Loan Servicing Portfolio:
                  Permanent  loans  serviced for FNMA with
                           risk sharing                                $  92,409
                  Permanent loans serviced for FNMA where risk is
                           indemnified by a third party*               $ 168,000
                  Permanent loans serviced which do not have risk      $ 246,305
                                                                       ---------
                  Total Permanent Loans Serviced                       $ 506,714
                                                                       =========

         *  The Midland Affordable Housing Group Trust indemnifies Midland for
            risks associated with approximately $136 million of construction
            loans and approximately $168 million of permanent loans serviced.
</TABLE>



          o   Equity Syndication and Asset Management. Midland syndicates equity
              for  investment  in low income  housing tax credits.  Midland also
              syndicates   equity  and   originates   debt  for   investment  in
              student/conventional  housing, a unique and growing segment of the
              multifamily  housing  industry.  Midland  currently  manages  $295
              million of such equity.

          o   Pension  Fund  Advisory.   Midland  Advisory  Services,   Inc.,  a
              registered  investment  advisor with the  Securities  and Exchange
              Commission  and  a  wholly-owned  special  purpose  subsidiary  of
              Midland,  provides  advisory  services to pension  funds.  Midland
              currently manages $259 million of such equity.

          o   Ancillary  Businesses  -  Real  Estate   Brokerage/Management  and
              Securities  Dealer.  Midland  Realty  Investment  Corporation,   a
              wholly-owned  special  purpose  subsidiary  of Midland,  acts as a
              licensed real estate broker in the states of Florida, Michigan and
              California.  Midland Securities  Corporation,  a registered broker
              dealer with the National  Association of Securities  Dealers and a
              wholly-owned  special  purpose  subsidiary  of  Midland,   markets
              syndications  of equity for real estate  investments  and provides
              securities broker dealer services.

         Midland has over 100  employees.  It is  headquartered  in  Clearwater,
         Florida,  and has  branch  offices  in Dallas,  Texas,  San  Francisco,
         California,   Portland,  Oregon  and  Detroit,  Michigan.

         Upon  closing of the  acquisition,  the  combined  companies  will have
         approximately  $1.7  billion of  investments  in real  estate  debt and
         equity under asset management:

          o  $429 million of tax-exempt bonds for its own account
             o  $222 million of participating bonds
             o  $207 million of fixed rate bonds
          o  $113 million of taxable mortgages for its own account
          o  $1.15 billion under management for others
             o  $722 million of permanent loans
             o  $136 million of construction loans
             o  $295 million of equity

         The combined company's property portfolio will have:
          o  557 properties
          o  51,926 units
          o  94% occupancy (as of 6/30/99)
          o  Geographic diversity - properties located in 45 states, the
             District of Columbia and the U.S. Virgin Islands

         The combined property portfolio will be broken out as:

         Own account
          o  101 properties
          o  20,835 units
          o  94% occupancy (as of 6/30/99)
          o  Properties located in 22 states, the District of Columbia and the
             U.S. Virgin Islands

         Managed for others
          o  456 properties
          o  31,091 properties
          o  94% occupancy (as of 6/30/99)
          o  Properties located in 44 states

         A copy  of  MuniMae's  press  release  announcing  the  transaction  is
attached hereto as Exhibit 99.1.

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

(c)      Exhibits.

         2.1  Stock  Purchase and  Contribution  Agreement  dated as of
              September  30,  1999,  by and among  Municipal Mortgage & Equity,
              LLC, and Robert J. Banks, Keith J. Gloekl and Ray F. Mathis.

         99.1 Press Release of Municipal Mortgage & Equity, LLC, dated
              October 4, 1999.

<PAGE>



         SIGNATURES

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  Registrant  has duly  caused  this Report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                 MUNICIPAL MORTGAGE & EQUITY, LLC



                                 By:        /s/ Michael L. Falcone
                                          Michael L. Falcone
                                          President and Chief Operating Officer






Date:  October 7, 1999


<PAGE>



                                  EXHIBIT INDEX

Exhibit No.                Exhibit

2.1                        Stock  Purchase  and  Contribution  Agreement  dated
                           as of September 30, 1999,  by and  among Municipal
                           Mortgage & Equity, LLC, and Robert J. Banks,
                           Keith J. Gloekl and Ray F. Mathis.

99.1                       Press Release of Municipal Mortgage & Equity, LLC,
                           dated October 4, 1999.




<PAGE>


                    STOCK PURCHASE AND CONTRIBUTION AGREEMENT

                         dated as of September 30, 1999

                                 by and between

                        MUNICIPAL MORTGAGE & EQUITY, LLC

                                       and

                                 ROBERT J. BANKS

                                KEITH J. GLOECKL

                                       and

                                  RAY F. MATHIS

                               with respect to all

                          outstanding capital stock of

                        MIDLAND FINANCIAL HOLDINGS, INC.





<PAGE>








                                                      TABLE OF CONTENTS


ARTICLE I  - DEFINITIONS......................................................1

         1.01         Definitions.............................................1

ARTICLE II - SALE AND CONTRIBUTION OF SHARES AND CLOSING.....................10

         2.01         Contribution, Purchase and Sale........................10

         2.02         Consideration..........................................10

         2.03         Closing................................................11

         2.04         Deferred Purchase Price................................12

         2.05         Adjustment to Deferred Purchase Price..................13

         2.06         Balance Sheet Adjustment...............................13

ARTICLE III - REPRESENTATIONS AND WARRANTIES OF SELLERS......................14

         3.01         Sellers................................................14

         3.02         Authority..............................................14

         3.03         Organization of the Company............................14

         3.04.        Capital Stock..........................................14

         3.05.        Subsidiaries...........................................14

         3.06.        No Conflicts...........................................15

         3.07.        Governmental Approvals and Filings.....................15

         3.08.        Financial Statements...................................15

         3.09.        Absence of Changes.....................................16

         3.10.        Taxes..................................................18

         3.11.        Legal Proceedings......................................19

         3.12.        Compliance With Laws and Orders........................20

         3.13.        Benefit Plans; ERISA...................................20

         3.14.        Real Property..........................................22

         3.15.        Tangible Personal Property.............................22

         3.16.        Intellectual Property Rights...........................23

         3.17.        Contracts..............................................23

         3.18.        Licenses...............................................25

         3.19.        Insurance..............................................25

         3.20.        Employees; Labor Relations.............................25

         3.21.        Substantial Business Relationships.....................26

         3.22.        No Powers of Attorney..................................27

         3.23         Assets.................................................27

         3.24.        Brokers................................................27

         3.25.        Year 2000 Compliance...................................27

         3.26.        Status of Outstanding Loans............................27

         3.27.        Status of Tax Credit Transactions......................28

         3.28.        No Undisclosed Liabilities.............................29

         3.29.        Affiliate Transactions.................................29

         3.30.        Books and Records......................................29

         3.31.        Qualification to do Business...........................29

         3.32.        Environmental Matters..................................29

         3.33.        Watch List.............................................30

ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF PURCHASER.....................30

         4.01.        Organization...........................................30

         4.02.        Authority..............................................30

         4.03.        Issuance of Common Shares..............................30

         4.04.        No Conflicts...........................................31

         4.05.        Governmental Approvals and Filings.....................31

         4.06.        Legal Proceedings......................................31

         4.07.        Purchase for Investment................................31

         4.08.        Brokers................................................31

         4.09         Disclosure.............................................32

         4.10         Financial Statements...................................32

         4.11         Organizational Documents...............................32

         4.12         SEC Filings............................................32

         4.13         Tax Matters............................................32

         4.14         Knowledge..............................................33

         4.15         Purchaser's Expertise and Investigation................33

         4.16         MESC Notice............................................34

ARTICLE V - COVENANTS OF SELLERS.............................................34

         5.01.        Regulatory and Other Approvals.........................34

         5.02.        Books and Records......................................35

         5.03.        Notice and Cure........................................35

         5.04.        Continued Access.......................................35

         5.05.        Operation of the Business Prior to Closing.............35

         5.06.        Disclosure; Shopping...................................35

         5.07         Tax Credit Entities; Ownership and Control.............35

         5.08         Updating of Schedules..................................36

         5.09         Affiliate Transactions.................................36

         5.10         Closing Share Restrictions.............................36

ARTICLE VI - COVENANTS OF PURCHASER..........................................37

         6.01.        Regulatory and Other Approvals.........................37

         6.02.        Notice and Cure........................................37

         6.03         Limitation of Sellers'Liabilities......................37

         6.04         Employees..............................................38

         6.05         Post-Closing Operations of the Company and the
                      Subsidiaries...........................................38

         6.06         704(c) Gain............................................38

ARTICLE VII - TAX MATTERS AND POST-CLOSING TAXES.............................38

         7.01.        Pre-Closing Tax Returns................................38

         7.02.        Transfer Taxes.........................................39

         7.03.        Post-Closing Taxes and Sellers'Post-Closing Taxes......39

         7.04.        Notification of Audits.................................40

         7.05.        Maintenance of Records.................................40

         7.06.        Purchase Price Adjustment..............................40

         7.07.        Tax Sharing Agreements.................................40

ARTICLE VIII - CONDITIONS TO CLOSING.........................................40

         8.01         Conditions to Purchaser's Performance..................40

         8.02         Conditions to Sellers' Performance.....................42

ARTICLE IX - SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND
               AGREEMENTS....................................................43
         9.01         Survival of Representations, Warranties, Covenants
                      and Agreements.........................................43

article x - INDEMNIFICATION..................................................44

         10.01.       Tax Indemnifications...................................44

         10.02.       Other Indemnification..................................44

         10.03.       Method of Asserting Claims.............................45

ARTICLE XI - MISCELLANEOUS...................................................48

         11.01.       Notices................................................48

         11.02.       Entire Agreement.......................................49

         11.03.       Expenses...............................................49

         11.04.       Public Announcements...................................50

         11.05.       Confidentiality........................................50

         11.06.       Further Assurances; Post-Closing Cooperation...........50

         11.07.       Waiver.................................................51

         11.08.       Amendment..............................................51

         11.09.       No Third Party Beneficiary.............................52

         11.10.       No Assignment; Binding Effect..........................52

         11.11.       Headings; Exhibits.....................................52

         11.12.       Breach, Abandonment, Termination.......................52

         11.13.       Consent to Jurisdiction and Service of Process.........52

         11.14.       Invalid Provisions.....................................52

         11.15.       Governing Law..........................................53

         11.16.       Counterparts...........................................53



Exhibits

         A --     Earn-Out Examples
         B --     Employment Agreements
         C --     Registration Rights Agreement



<PAGE>




         This STOCK PURCHASE AND  CONTRIBUTION  AGREEMENT  dated as of September
30, 1999 is made and entered  into by and between  MUNICIPAL  MORTGAGE & EQUITY,
LLC, a Delaware limited  liability company  ("Purchaser"),  and Robert J. Banks,
Keith J. Gloeckl and RAY F. Mathis (together  "Sellers").  Capitalized terms not
otherwise defined herein have the meanings set forth in Section 1.01.

         WHEREAS, Sellers own in the aggregate 1,000 shares of common stock, par
value  $0.10  per  share,  of  Midland  Financial  Holdings,   Inc.,  a  Florida
corporation (the "Company"),  constituting all issued and outstanding  shares of
capital  stock of the  Company  (such  shares  being  referred  to herein as the
"Midland Shares"); and

         WHEREAS,  Sellers desire to contribute and sell, and Purchaser  desires
to acquire  and  purchase,  the  Midland  Shares on the terms and subject to the
conditions set forth in this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration,  the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         1.01     Definitions.

                  (a)   As used in this Agreement,  the following defined terms,
when used with initial capital letters, shall have the meanings indicated below:

         "Actions  or   Proceedings"   means  any  action,   suit,   proceeding,
arbitration or Governmental or Regulatory Authority audit.

         "Affiliate" means any Person that directly,  or indirectly  through one
of more intermediaries,  controls or is controlled by or is under common control
with the Person specified. For purposes of this definition,  control of a Person
means the power,  direct or  indirect,  to direct or cause the  direction of the
management  and policies of such Person whether by Contract or otherwise and, in
any event and without limitation of the previous sentence, any Person owning ten
percent or more of the voting  securities  of a second Person shall be deemed to
control that second Person.

         "Agreement"  means this Stock Purchase and  Contribution  Agreement and
the Exhibits,  together with the Disclosure  Schedule and the Schedules attached
thereto, as the same shall be amended from time to time.

         "Assets and  Properties"  of any Person means all assets and properties
of every kind,  nature,  character and  description  (whether real,  personal or
mixed, whether tangible or intangible,  whether absolute,  accrued,  contingent,
fixed or  otherwise  and wherever  situated),  including  the  goodwill  related
thereto,   operated,  owned  or  leased  by  such  Person,  including,   without
limitation,  cash,  cash  equivalents,  Investment  Assets,  accounts  and notes
receivable,  chattel paper, documents,  instruments,  general intangibles,  real
estate, equipment, inventory, goods and Intellectual Property.

         "Associate" means, with respect to any Person, any corporation or other
business  organization  of which such  Person is an officer or partner or is the
beneficial owner, directly or indirectly, of ten percent or more of any class of
equity  securities,  any trust or estate in which such Person has a  substantial
beneficial  interest  or as to which  such  Person  serves as a trustee  or in a
similar  capacity and any relative or spouse of such Person,  or any relative of
such spouse, who has the same home as such Person.

         "Audited Financial Statement Date" means December 31, 1998.

         "Audited Financial  Statements" means the Financial  Statements for the
fiscal year of the Company ended December 31, 1998.

         "Benefit  Plan" means any Plan existing prior to or on the date hereof,
which  the  Company,  any  Subsidiary  or any  ERISA  Affiliate  has at any time
sponsored,  established,  maintained  or  contributed  to,  or under  which  any
employee,  former  employee or director of the Company or any  Subsidiary or any
beneficiary thereof is covered, is eligible for coverage or has benefit rights.

         "Board of Arbitration" shall have the meaning set forth in Section
10.03(d).

         "Books and Records" means all material files,  documents,  instruments,
papers,  books and records relating to the Business or Condition of the Company,
including,  without limitation,  financial  statements,  Tax Returns and related
work papers and letters from accountants,  budgets, pricing guidelines, ledgers,
journals,  deeds,  title policies,  minute books,  stock certificates and books,
stock transfer ledgers, Contracts,  Licenses, customer lists, computer files and
programs, retrieval programs, operating data and plans and environmental studies
and plans.

         "Borrower"  means the  borrower  on any loan  which the  Company or any
Subsidiary  originated,  holds,  or  services,  or  which  the  Company  or  any
Subsidiary has sold under any arrangement  wherein the Company or any Subsidiary
retains any risk of loss.

         "Business  Combination"  means with  respect to any Person any  merger,
consolidation or combination to which such Person is a party, any sale, or other
disposition  of all or  substantially  all of the capital  stock or other equity
interests of such Person or any sale,  dividend or other  disposition  of all or
substantially all of the Assets and Properties of such Person.

         "Business  Day" means a day other than  Saturday,  Sunday or any day on
which banks  located in any of the States of Florida,  Maryland and New York are
authorized or obligated to close.

         "Business or Condition of the Company"  means the  business,  condition
(financial or otherwise),  results of  operations,  Assets and Properties of the
Company and the Subsidiaries taken as a whole.

         "Cash Closing Payment" shall have the meaning set forth in Section
2.03.

         "Claim Notice" means written notification  pursuant to Section 10.03(a)
of a Third Party Claim as to which indemnity under Section 10.02 is sought by an
Indemnified Party, enclosing a copy of all papers served, if any, and specifying
the  nature of and  basis for such  Third  Party  Claim and for the  Indemnified
Party's claim against the Indemnifying Party under Section 10.02,  together with
the amount  or, if not then  reasonably  ascertainable,  the  estimated  amount,
determined in good faith, of such Third Party Claim.

         "Closing" means the closing of the transactions contemplated by
Section 2.03.

         "Closing  Agreement" means a written and legally binding agreement with
a Governmental or Regulatory Authority relating to Taxes.

         "Closing Audit" shall have the meaning set forth in Section 2.05.

         "Closing Date" shall have the meaning set forth in Section 2.03(a).

         "Closing Payment" shall have the meaning set forth in Section 2.03.

         "Code" means the Internal  Revenue  Code of 1986,  as amended,  and the
rules and regulations promulgated thereunder.

         "Company" shall have the meaning set forth in the forepart of this
Agreement.

         "Contract"  means  any  agreement,  lease,  evidence  of  Indebtedness,
mortgage,  indenture,  security  agreement or other contract (whether oral or in
writing).

         "Deferred Purchase Price" shall have the meaning set forth in Section
2.04.

         "Defined  Benefit  Plan" means each Plan which is subject to Part 3 of
Title 1 of ERISA,  Section 412  of the Code or Title IV of ERISA.

         "Disclosure  Schedule"  means the schedules  delivered to Purchaser and
Sellers simultaneously  herewith and dated as of the date hereof pursuant to the
terms of this  Agreement,  containing  all lists,  descriptions,  exceptions and
other  information  and  materials as are  required to be included  therein from
Sellers or Purchaser  pursuant to this  Agreement,  except that, with respect to
Schedules 4.04 and 4.05,  "Disclosure Schedule" means the schedules delivered to
Sellers by Purchaser  herewith and dated as of the date hereof,  containing  all
lists,  descriptions,  exceptions  and other  information  and  materials as are
required to be included therein from Purchaser pursuant to this Agreement.

         "Dispute  Period" means the period ending 90 calendar days following
receipt by an Indemnifying Party of either a Claim Notice or an Indemnity
Notice.

         "DUS" means the Delegated  Underwriting  and  Servicing  relationships,
status and guidelines as defined by Fannie Mae in its agreements and guidelines.

         "Earn-out  Period"  means the period from Closing  until  September 30,
2002.

         "Earn-out Shares" shall have the meaning set forth in Section 2.04.

         "Employment Agreements" shall have the meaning set forth in Section
8.01.

         "ERISA" means the Employee  Retirement  Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.

         "ERISA  Affiliate" means any Person who is in the same controlled group
of corporations or who is under common control,  or is otherwise  deemed to be a
single  employer,  with  Sellers  or,  before the  Closing,  the  Company or any
Subsidiary, pursuant to Section 414 of the Code.

         "Environmental  Law"  means  any  Law  relating  to  protection  of the
environment  or to emissions,  discharges,  releases or  threatened  releases of
pollutants,  contaminants or Hazardous Materials in the environment  (including,
without  limitation,  ambient air, surface water,  ground water, land surface or
subsurface strata), or otherwise relating to the treatment,  storage or disposal
of any Hazardous Material.

         "Fannie Mae" or "FNMA" means the Federal National Mortgage Association.

         "FHLA" means the Farmers Home Loan Association.

         "Financial  Statements" means the consolidated  financial statements of
the Company and its consolidated Subsidiaries delivered to Purchaser pursuant to
Section 3.08.

         "GAAP" means generally  accepted  accounting  principles,  consistently
applied  throughout the specified period and in the immediately prior comparable
period.

         "GNMA" means the Government National Mortgage Association.

         "Governmental  or  Regulatory  Authority"  means any  court,  tribunal,
arbitrator,  authority, agency, commission, official or other instrumentality of
the United States, any foreign country or any domestic or foreign state, county,
city or other political subdivision.

         "Hazardous Material" means (i) any chemicals,  materials, substances or
wastes  which  are  now  or  hereafter  become  defined  as or  included  in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic  pollutants" or words of similar  import,  under any  Environmental  Law,
including, without limitation, any petroleum or petroleum products,  radioactive
materials,  asbestos  in  any  form  that  is  or  could  become  friable,  urea
formaldehyde  foam  insulation and  transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls (PCBs); and (ii)
any other chemical,  material,  substance or waste,  exposure to which is now or
hereafter  prohibited,  limited or regulated by any  Governmental  or Regulatory
Authority.

         "HSR  Act"  means  Section  7A of  the  Clayton  Act  (Title  II of the
Hart-Scott-Rodino  Antitrust Improvements Act of 1976, as amended) and the rules
and regulations promulgated thereunder.

         "HUD" means the United States Department of Housing and Urban
Development.

         "Indebtedness"  of any Person means all  obligations of such Person (i)
for borrowed  money,  (ii)  evidenced  by notes,  bonds,  debentures  or similar
instruments,  (iii) for the deferred  purchase price of goods or services (other
than trade  payables or accruals  incurred in the ordinary  course of business),
(iv) under capital leases and (v) in the nature of guarantees of the obligations
described in clauses (i) through (iv) above of any other Person.

         "Indemnified Party" means any Person claiming indemnification under any
provision of Article X,  including,  without  limitation,  a Person  asserting a
claim pursuant to paragraph (c) of Section 10.03.

         "Indemnifying  Party"  means  any  Person  against  whom  a  claim  for
indemnification  is being asserted under any provision of Article X,  including,
without  limitation,  a Person  against  whom a claim is  asserted  pursuant  to
paragraph (c) of Section 10.03.

         "Indemnity  Notice"  means  written  notification  pursuant  to Section
10.03(b)  of a claim for  indemnity  under  Article X by an  Indemnified  Party,
specifying the nature of and basis for such claim,  together with the amount or,
if not then reasonably  ascertainable,  the estimated amount, determined in good
faith, of such claim.

         "Intellectual Property" means all patents and patent rights, trademarks
and  trademark  rights,  trade names and trade name  rights,  service  marks and
service  mark  rights,  service  names and service  name  rights,  brand  names,
inventions,  processes,  formulae, copyrights and copyright rights, trade dress,
business and product names, logos,  slogans,  trade secrets,  industrial models,
processes,  designs,  methodologies,  computer  programs  (including  all source
codes)  and  related  documentation,   technical   information,   manufacturing,
engineering and technical  drawings,  know-how and all pending  applications for
and registrations of patents, trademarks, service marks and copyrights.

         "Investment Assets" means all debentures,  notes and other evidences of
Indebtedness,  stocks,  securities  (including rights to purchase and securities
convertible  into or  exchangeable  for other  securities),  interests  in joint
ventures  and  general  and  limited  partnerships,  mortgage  loans  and  other
investment or portfolio assets owned of record or beneficially by the Company or
any Subsidiary (other than securities issued by any Subsidiary).

         "IRS" means the United States Internal Revenue Service.

         "Knowledge"  with  respect to Sellers,  the Company or any  Subsidiary,
Affiliates or  Associates  means the actual  knowledge of Sellers only,  without
inquiry or investigation by the Sellers (unless otherwise stated in the text).

         "Laws" means all laws,  statutes,  rules,  regulations,  ordinances and
other pronouncements  having the effect of law of the United States, any foreign
country  or any  domestic  or foreign  state,  county,  city or other  political
subdivision or of any Governmental or Regulatory Authority.

         "Liabilities" means all Indebtedness, obligations and other liabilities
of a Person  (whether  absolute,  accrued,  contingent,  fixed or otherwise,  or
whether due or to become due).

         "Licenses"  means  all  material  licenses,  permits,  certificates  of
authority,  authorizations,  approvals,  registrations,  franchises  and similar
consents granted or issued by any Governmental or Regulatory Authority.

         "Liens"  means any mortgage,  pledge,  assessment,  security  interest,
lease,  lien,  adverse claim,  levy, charge or other encumbrance of any kind, or
any conditional  sale Contract,  title  retention  Contract or other Contract to
give any of the foregoing.

         "Loss" means any and all damages, fines, fees, penalties, deficiencies,
losses and  expenses  (including,  without  limitation,  interest,  court costs,
reasonable fees of attorneys, accountants and other experts or other expenses of
litigation or other proceedings or of any claim, default or assessment).

         "MAHGT" means the Midland Affordable Housing Group Trust.

         "Material  Adverse  Effect"  means a  material  adverse  effect  on the
business,  financial  condition or results of  operations of the Company and the
Subsidiaries taken as a whole with a potential exposure of more than $100,000.

         "Material Contracts" shall have the meaning set forth in Section 3.17.

         "Midland Shares" shall have the meaning set forth in the forepart of
this Agreement.

         "MMI" means Midland Mortgage Investment Corporation.

         "MMI  Interest  Strip"  means any  interest  strip,  interest  payable,
interest  reservation or similar right, payment or benefit created in connection
with the sale of any loan by, and reserved  unto,  MMI and/or  MAHGT,  including
without limitation,  rights described in Paragraph 6 of that certain Lending and
Warehousing  Agreement  dated as of  September  1, 1997  between  MMI and MAHGT,
regardless of how characterized on the books and records of MMI and/or MAHGT.

         "Net  Income"  means the  Company's  net income  before  income  taxes,
amortization  and  depreciation  expense  determined  using  the  Company's  "as
purchased"  cost  structure  and  accounting   principles  consistent  with  the
Company's  historical  practice.  For  purposes  of  determining  payment of the
Deferred Purchase Price under Section 2.04: Net Income shall be calculated as if
the Company and its Subsidiaries continued to operate independently of Purchaser
and on a  stand-alone  basis,  without  including  any  income,  loss or expense
attributable  to  any of  Purchaser's,  or its  Subsidiaries',  Affiliates'  and
Associates', other operations or business, even if certain of such operations or
business are allocated to or conducted in conjunction with the Company or any of
its  Subsidiaries;  notwithstanding  the preceding  clause,  for any transaction
between  Purchaser  (or its  Subsidiaries)  and  existing  customers  (as of the
Closing Date) of the Company and its Subsidiaries, or for which the Company, its
Subsidiaries,  or the Sellers are  responsible,  Purchaser  and Sellers will use
good faith  efforts to agree to a fair  allocation  of income and  expense at or
prior to the closing of such transaction.  Net Income shall exclude MMI Interest
Strip  income and all one-time  out-of-pocket  costs and expenses of the Company
incurred  in  connection  with the  negotiation,  execution  and closing of this
Agreement and the transactions contemplated hereby and any cost or expense which
is subject to indemnification under this Agreement or covered by insurance;  and
Net Income shall include any sales proceeds (net of direct expense not otherwise
deductible  in  determining   Net  Income)   received  by  the  Company  or  its
Subsidiaries in connection with the sale of the Company's (or any  Subsidiary's)
right to low income  housing tax credits  arising from the  Company's tax credit
syndication  business or the sale of any general  partner  interest owned by the
Company  (or  any  Subsidiary)  in  any  Tax  Credit  Partnership  or  Operating
Partnership.  The Company's  historical practice shall be based on the practices
certified  to by  PricewaterhouseCoopers  in  preparing  the  Company's  Audited
Financial  Statements  for 1998 and prior  years.  In the  event of any  dispute
between  Sellers and Purchaser as to the proper  allocation of an item of income
or expense for purposes of calculating Net Income, the dispute shall be referred
to an  independent  public  accounting  firm  mutually  agreeable to Sellers and
Purchaser, whose decision shall be final and conclusive absent manifest error.

         "Operating  Partnership" means a partnership or other entity in which a
Tax Credit  Partnership or other entity syndicated or arranged by the Company or
a Subsidiary  has invested for the purpose of obtaining  low income  housing tax
credits.

         "Operative   Agreements"   means   the   Employment   Agreements,   the
Registration  Rights  Agreement,  and any other agreements to be entered into in
connection with the transactions contemplated herein.

         "Option"  with  respect  to  any  Person  means  any  security,  right,
subscription,  warrant,  option,  "phantom"  stock right or other  Contract that
gives the right to (i) purchase or otherwise  receive or be issued any shares of
capital  stock of such Person or any  security of any kind  convertible  into or
exchangeable  or  exercisable  for any shares of capital stock of such Person or
(ii) receive any benefits or rights similar to any rights enjoyed by or accruing
to the holder of shares of capital stock of such Person, including any rights to
participate  in the equity,  income or election of directors or officers of such
Person.

         "Order" means any writ, judgment,  decree,  injunction or similar order
of  any  Governmental  or  Regulatory  Authority  (in  each  such  case  whether
preliminary or final).

         "Pension  Benefit  Plan"  means  each  Benefit  Plan which is a pension
benefit plan within the meaning of Section 3(2) of ERISA, whether or not subject
to ERISA.

         "Permitted Lien" means (i) any Lien for Taxes not yet due or delinquent
or which is being  contested in good faith by  appropriate  proceedings or which
has been bonded off and for which  adequate  reserves have been  established  in
accordance with GAAP or defense has been accepted by any insurance company, (ii)
any  statutory  Lien arising in the ordinary  course of business by operation of
Law with respect to a Liability  that is not yet due or  delinquent  or which is
being  contested in good faith by  appropriate  proceedings  for which  adequate
reserves have been established in accordance with GAAP or which have been bonded
off or defense has been accepted by any  insurance or bonding  company and (iii)
any other  Lien which  individually  or in the  aggregate  with other such Liens
would not reasonably be expected to have a Material Adverse Effect.

         "Person" means any natural person,  corporation,  general  partnership,
limited partnership, limited liability company,  proprietorship,  other business
organization, trust, union, association or Governmental or Regulatory Authority.

         "Plan" means any bonus, incentive compensation,  deferred compensation,
pension,  profit  sharing,  retirement,  stock  purchase,  stock  option,  stock
ownership,  stock appreciation rights, phantom stock, leave of absence,  layoff,
vacation,  day or dependent  care,  legal  services,  cafeteria,  life,  health,
accident, disability or other insurance, severance, separation or other employee
benefit plan,  practice,  policy or arrangement of any kind,  whether written or
oral,  and  whether or not subject to ERISA  including,  but not limited to, any
"employee benefit plan" within the meaning of Section 3(3) of ERISA.

         "Post-Closing Tax Returns" shall have the meaning set forth in Section
7.03(a).

         "Post-Closing Taxes" shall have the meaning set forth in Section
7.03(a).

         "Pre-Closing Taxes" shall have the meaning set forth in Section 7.01.

         "Pre-Closing Tax Returns" shall have the meaning set forth in Section
7.01.

         "Purchase Price" shall have the meaning set forth in Section 2.02.

         "Purchaser" shall have the meaning set forth in the forepart of this
Agreement.

         "Purchaser Common Shares" means the common shares, no par value, of
Purchaser.

         "Purchaser Closing Shares" shall have the meaning set forth in Section
2.03(b).

         "Qualified  Plan" means each  benefit plan which is intended to qualify
under Section 401 of the Code.

         "Registration Rights Agreement" shall have the meaning set forth in
Section 8.02(e).

         "Representatives"  means the officers,  directors,  employees,  agents,
counsel, accountants, financial advisors, consultants, and other representatives
of a Person.

         "Resolution  Period"  means the period ending thirty (30) calendar days
following  receipt by an  Indemnified  Party of an  Indemnity  Notice or a Claim
Notice.

         "SEC" shall have the meaning set forth in Section 4.09.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Sellers" shall have the meaning set forth in the forepart of this
Agreement.

         "Sellers' Post-Closing Taxes" shall have the meaning set forth in
Section 7.03(b).

         "Sellers' Tax Costs" shall have the meaning set forth in Section 10.01.

         "Share Closing Payment" shall have the meaning set forth in Section
2.03.

         "Subsidiary"  means  any  Person  in which  the  Company,  directly  or
indirectly through Subsidiaries or otherwise, beneficially owns more than 50% of
either the equity interests in, or the voting control of, such Person.

         "Surplus" shall have the meaning set forth in Section 2.04(b).

         "Tax or Taxes"  means any  federal,  state,  county,  local or  foreign
taxes,  charges,  fees, levies, or other assessments,  including all net income,
gross  income,  sales and use, ad valorem,  transfer,  gains,  profits,  excise,
franchise, real and personal property, gross receipt, capital stock, production,
business and occupation,  disability,  employment,  payroll, license, estimated,
stamp,  custom duties,  severance or withholding taxes or charges imposed by any
governmental entity, and includes any interest and penalties (civil or criminal)
on or additions to any such taxes.

         "Tax Credit Partnership" means a partnership or other entity syndicated
or arranged by the Company or a  Subsidiary  to invest in one or more  Operating
Partnerships.

          "Tax Ruling" means a written  ruling of a  Governmental  or Regulatory
Authority relating to Taxes.

         "Tax Return" means a report, return or other information required to be
supplied  to  a  governmental  entity  with  respect  to  Taxes  including,   if
applicable,  combined or  consolidated  returns  for any group of entities  that
includes the Company.

         "Third Party Claim" shall have the meaning set forth in Section
10.03(a).

         "Transaction"  means the  acquisition  by Purchaser from Sellers of the
Midland Shares as contemplated by this Agreement.

         "Trust" means MAHGT.

         "Trust  Agreement"  means the Midland  Affordable  Housing  Group Trust
Amended and Restated  Agreement and  Declaration of Trust dated January 1, 1992,
as the same has been amended, supplemented or modified from time to time.

         "Unaudited Financial Statements" means the Financial Statements for the
most recent  fiscal  quarter of the  Company  ended June 30,  1999,  and for the
periods ended July 31, 1999, and August 31, 1999.

         "Unaudited Financial Statement Date" means June 30, 1999.

                  (b)   Unless   the  context  of  this  Agreement  otherwise
requires,  (i) words of any gender  include each other gender;  (ii) words using
the  singular  or plural  number also  include  the plural or  singular  number,
respectively;  (iii) the terms  "hereof,"  "herein,"  "hereby" and derivative or
similar  words  refer to this  entire  Agreement;  (iv) the terms  "Article"  or
"Section" refer to the specified  Article or Section of this Agreement;  and (v)
the phrases  "ordinary  course of  business"  and  "ordinary  course of business
consistent with past practice" refer to the business and practice of the Company
or a Subsidiary.  All  accounting  terms used herein and not  expressly  defined
herein shall have the meanings given to them under GAAP.

                  (c)   All  references herein to Schedules regardless of the
Section  reference  shall  mean and refer to all the  Schedules  attached  to or
forming part of the Disclosure  Schedule.  Seller will use good faith efforts to
cross-reference items which are properly discloseable on more than one Schedule.

                                   ARTICLE II
                   SALE AND CONTRIBUTION OF SHARES AND CLOSING

         2.01  Contribution,  Purchase and Sale. Sellers agree to contribute and
sell to Purchaser,  and  Purchaser  agrees to acquire and purchase from Sellers,
all of the Midland  Shares at Closing on the terms and subject to the conditions
set forth in this Agreement.

         2.02 Consideration.  The aggregate consideration for the Midland Shares
and for the  non-compete  provisions set forth in the  Employment  Agreements is
U.S.  $35,000,000 plus the right to receive,  in the future, a U.S.  $10,000,000
earn-out described in Section 2.04 below, (the "Purchase Price"), payable in the
manner  provided in Sections  2.03 and 2.04,  $90,000 of which is allocable  pro
rata to, and deemed to be in  consideration  of, the non-compete  provisions set
forth in the  Employment  Agreements and the remainder of which is allocable to,
and deemed to be in  consideration  of,  the  Midland  Shares.  A portion of the
Purchase  Price is subject to deferral  and  adjustment  as provided in Sections
2.04 and 2.05.


         2.03     Closing.

                  (a)   The  Closing  will take place at 10:00  a.m.  eastern
time on the third  Business Day  following  the date on which all  conditions to
Closing set forth in Article VIII have been  satisfied or waived,  but not later
than October 15, 1999 (the "Closing Date") at the offices of Gallagher,  Evelius
& Jones, LLP, 218 N. Charles Street, Suite 400, Baltimore,  Maryland 21201 or at
such other time and place as Purchaser and Sellers mutually agree.

                  (b)   At  the Closing,  Purchaser will pay a portion of the
Purchase Price in the following manner: (i) by wire transfer of $23,000,000 (the
"Cash  Closing  Payment") in  immediately  available  funds to such  accounts as
Sellers may reasonably direct by written notice delivered to Purchaser; and (ii)
by  issuance  to Sellers  of good and valid  title in and to the number of whole
Purchaser  Common  Shares  the  value of which  equals  or most  nearly  exceeds
$12,000,000 (the "Purchaser  Closing  Shares"),  free and clear of all Liens, by
delivering to Sellers a certificate or certificates  representing  the Purchaser
Closing  Shares,  in genuine  and  unaltered  form,  duly  endorsed  in blank or
accompanied  by duly executed  stock powers  endorsed in blank,  with  requisite
stock transfer tax stamps,  if any,  attached;  such Purchaser Closing Shares to
represent  payment of  $12,000,000  of the  Purchase  Price (the "Share  Closing
Payment," together with the Cash Closing Payment, the "Closing Payment").

                  (c)   For  purposes  of this  Agreement,  the  value of the
Purchaser Closing Shares shall equal the average of the closing prices per share
of  Purchaser  Common  Shares on the New York Stock  Exchange for the 30 trading
days prior to the date preceding Closing.

                  (d)   Simultaneously,  Sellers  will assign and transfer to
Purchaser good and valid title in and to the Midland  Shares,  free and clear of
all Liens, by delivering to Purchaser a certificate or certificates representing
the Midland  Shares,  in genuine and unaltered  form,  duly endorsed in blank or
accompanied  by duly executed  stock powers  endorsed in blank,  with  requisite
stock transfer tax stamps, if any, attached.

                  (e)   All  payments  and  transfers  of  Purchaser  Closing
Shares and Earn-out Shares to Sellers shall be made 60% to Robert J. Banks,  20%
to Keith J. Gloeckl and 20% to Ray F. Mathis.  Sellers shall  provide  Purchaser
with their  respective  wiring  instructions  at least one Business Day prior to
Closing.

                  (f)   The  partnership  interests  identified  on  Schedule
2.03(f)  shall not be deemed to be Assets or  Properties  of the  Company or its
Subsidiaries, Associates or Affiliates.



         2.04     Deferred Purchase Price.

                  (a)   Ten  Million  Dollars  ($10,000,000)  of the Purchase
Price,  as the same may be  adjusted  in  accordance  with  Section  2.04(b) and
Section 2.05 (as adjusted,  the "Deferred  Purchase  Price") shall be payable by
the  assignment  and transfer to Sellers of Purchaser  Common Shares  ("Earn-out
Shares") having a value equal to or most nearly exceeding the Deferred  Purchase
Price, as follows:  (A) 1/3 of the Deferred  Purchase Price shall be paid by the
transfer of Earn-out Shares to Sellers on December 1, 2000 if Net Income for the
period October 1, 1999 through September 30, 2000 exceeds $6,000,000; (B) 1/3 of
the Deferred  Purchase Price shall be paid by the transfer of Earn-out Shares to
Sellers  on  December  1, 2001 if Net Income  during the period  October 1, 2000
through September 30, 2001 (as increased by any Surplus) exceeds $6,250,000; and
(C) 1/3 of the Deferred  Purchase  Price shall be paid by the transfer  Earn-out
Shares to Sellers on December 1, 2002 if Net Income during the period October 1,
2001  through   September  30,  2002  (as  increased  by  any  Surplus)  exceeds
$6,500,000.

                  (b)   In the event that Net Income for any period described
in Section 2.04(a) above, as increased by any Surplus (hereinafter  defined), is
less than the relevant  target  amount for such  period,  the number of Earn-out
Shares that are  transferred  to Sellers shall be reduced such that the value of
the Earn-out  Shares  transferred  to Sellers for such period is reduced by $.50
for each $1.00 by which Net Income (as increased by any Surplus) for such period
is less than the target amount for such period.

         If Net Income for any period  exceeds the target amount for such period
(a  "Surplus"),  as  verified by Sellers or their  representatives,  the Surplus
shall be  applied  first to offset the  effect of any prior  shortfall  (thereby
resulting  in the  issuance  of  additional  Earn-out  Shares to make up for any
reduction in Earn-Out  Shares under the preceding  paragraph),  with the balance
carried forward and applied to offset a shortfall in any future period; thus, to
the extent that Net Income for a period  ("given  period"),  as increased by the
unapplied Surplus from any prior period, exceeds the target amount for the given
period,  the Earn-out  Shares for the period shall be increased by $.50 for each
$1.00 by which Net Income for the given period,  when increased by any unapplied
Surplus from any prior  period,  exceeds the target amount for the given period;
provided,  however,  that such increase shall not exceed the aggregate amount of
any prior reductions in Earn-out Shares.

         The effect of the  adjustments  provided for in this Section 2.04(b) is
illustrated in Exhibit A incorporated herein.

                  (c)   For  purposes of the  Deferred  Purchase  Price,  Net
Income shall be based upon unaudited, internally prepared consolidated financial
statements of the Company and its wholly-owned  Subsidiaries for the twelve (12)
month  period  ending  September  30 in 2000,  2001 and  2002,  which  financial
statements  shall be delivered by Purchaser to Sellers not later than October 31
in each of 2000, 2001 and 2002, together with Purchaser's good faith calculation
of Net Income for such  period,  and any  proposed  adjustments  to the Deferred
Purchase Price based thereon. If Sellers dispute any determination of Net Income
and the parties are unable to resolve the  dispute,  Net Income for the relevant
period shall be determined by  PricewaterhouseCoopers  LLP initiated through the
Tampa  Bay,  Florida  office,  or by  any  other  independent  certified  public
accountant jointly selected by Sellers and Purchaser,  whose determination shall
be conclusive  and binding on all parties for such purpose,  absent clear error.
Purchaser shall bear any costs incurred or charged by PricewaterhouseCoopers LLP
or any independent  certified public accountant  jointly selected by Sellers and
Purchaser in making such determination.

                  (d)   For  purposes of this Section 2.04,  the value of the
Earn-out  Shares  delivered on each of the dates  described  in Section  2.04(a)
shall be the average of the closing prices per share of Purchaser  Common Shares
on the New York Stock Exchange for the 30 trading days prior to such date.

                  (e)   Notwithstanding  any other  provision of this Section
2.04 to the contrary, if the value of the Earn-out Shares to be delivered on any
of the dates set forth in  Section  2.04(a) is  determined  in  accordance  with
Section  2.04(d) to be less than Fifteen Dollars  ($15.00) per share,  Purchaser
may, in its sole discretion, pay the amount of the Deferred Purchase Price which
is due and  payable on such date in cash  rather  than by  delivery  of Earn-out
Shares to Sellers.

                  (f)   Sellers shall not assign, convey, pledge or otherwise
transfer or encumber their right to Earn-Out Shares except among each other and,
for estate planning  purposes,  to their  immediate  families or trusts the sole
beneficiaries of which are their immediate  families;  and, in the case of Keith
Gloeckl,  as necessary in connection with any property settlement related to his
divorce.

         2.05  Adjustment  to Deferred  Purchase  Price.  The  maximum  Deferred
Purchase Price of $10,000,000  shall be reduced dollar for dollar by the amount,
if any,  by which  the  stockholders'  equity in the  Company  is less than $7.5
million as of the Closing  Date.  The amount of  stockholders'  equity as of the
Closing  Date  shall  be  determined  by an  audit  of the  Company's  financial
condition  as of the Closing  Date (the  "Closing  Audit").  Such audit shall be
conducted at the Purchaser's expense by PricewaterhouseCoopers LLP in accordance
with GAAP;  provided  however,  that for purposes of  determining  stockholders'
equity under this Section 2.05 and under  Section  2.06,  any loan loss reserves
shall be ignored.  Purchaser shall initiate such audit immediately after Closing
and shall use diligent  efforts to have the audit  completed as soon as possible
but in any event not later than sixty (60) days after the Closing Date.  The MMI
Interest  Strip  shall  not  be  considered  an  asset  of  the  Company  or its
Subsidiaries for purposes of the Closing Audit.

         2.06 Balance Sheet Adjustment. In the event the amount of stockholders'
equity  as  determined  in the  Closing  Audit is  greater  than  $7.5  million,
Purchaser shall pay to Sellers cash in the amount by which stockholders'  equity
in the Company as of the Closing Date exceeds $7.5  million.  Such payment shall
be made within five days after  completion  of the  Closing  Audit.  As noted in
Section  2.05,  the MMI Interest  Strip shall not be  considered an asset of the
Company or its Subsidiaries for purposes of the Closing Audit.

                                   ARTICLE III
                    REPRESENTATIONS AND WARRANTIES OF SELLERS

         Sellers,  jointly and severally,  represent and warrant to Purchaser as
follows:

         3.01 Sellers. Sellers are individuals residing in the State of Florida.

         3.02 Authority.  This Agreement has been duly and validly  executed and
delivered by the Sellers and constitutes the legal, valid and binding obligation
of Sellers  enforceable  against Sellers in accordance with its terms, except as
may  be   limited  by   applicable   bankruptcy,   insolvency,   reorganization,
recharacterization  or other similar laws affecting  creditor's rights generally
and by general  equitable  principles  (regardless  of whether  considered  in a
proceeding in equity or at law).

         3.03  Organization  of the Company.  The Company is a corporation  duly
organized,  validly existing and in good standing under the Laws of the State of
Florida,  and has full corporate  power and authority to conduct its business as
and to the  extent  now  conducted  and to own,  use and  lease its  Assets  and
Properties.  The Company is duly qualified,  licensed or admitted to do business
and is in good standing in those  jurisdictions  specified in Schedule 3.03. The
name of each  director  and officer of the Company on the date  hereof,  and the
position  with the Company held by each,  are listed in Schedule  3.03.  Sellers
have prior to the execution of this  Agreement  delivered to Purchaser  true and
complete copies of the articles of  incorporation  and by-laws of the Company as
in effect on the date hereof.

         3.04.  Capital  Stock.  The  authorized  capital  stock of the  Company
consists  solely of 10,000  shares of Common  Stock,  of which only the  Midland
Shares are issued  and  outstanding.  The  Midland  Shares are duly  authorized,
validly  issued,  outstanding,  fully paid and  nonassessable.  Sellers  own the
Midland Shares,  beneficially and of record,  subject only to those Liens listed
on Schedule 3.04. There are no outstanding  Options with respect to the Company.
At Closing,  Sellers  will deliver to Purchaser a  certificate  or  certificates
representing  the Midland Shares in the manner provided in Section 2.03 and will
transfer to Purchaser good and valid title to the Midland Shares, free and clear
of all Liens.

         3.05. Subsidiaries. Schedule 3.05 lists the name of each Subsidiary. To
the Seller's Knowledge each Subsidiary is a corporation duly organized,  validly
existing  and  in  good  standing  under  the  Laws  of  its   jurisdiction   of
incorporation  identified in Schedule  3.05,  and has full  corporate  power and
authority to conduct its business as and to the extent now conducted and to own,
use and lease its Assets and  Properties.  Each  Subsidiary  is duly  qualified,
licensed  or  admitted  to  do  business  and  is  in  good  standing  in  those
jurisdictions  specified Schedule 3.05. All of the outstanding shares of capital
stock of each Subsidiary have been duly authorized and validly issued, are fully
paid and nonassessable, and are owned, beneficially and of record by the Company
or Subsidiaries  wholly owned by the Company free and clear of all Liens.  There
are no  outstanding  Options  with respect to any  Subsidiary.  The name of each
director and officer of each  Subsidiary  on the date  hereof,  and the position
with such  Subsidiary  held by each, are listed in Schedule  3.05.  Sellers have
prior  to the  execution  of this  Agreement  delivered  to  Purchaser  true and
complete copies of the certificate or articles of incorporation  and by-laws (or
other comparable  corporate charter documents) of each of the Subsidiaries as in
effect on the date hereof.

         3.06.  No  Conflicts.  The  execution  and  delivery by Sellers of this
Agreement  does not, and the  execution and delivery by Sellers of the Operative
Agreements  to which  they are a party,  the  performance  by  Sellers  of their
obligations  under  this  Agreement  and  such  Operative   Agreements  and  the
consummation of the transactions contemplated hereby and thereby will not:

                  (a)   conflict  with or result in a  violation  or breach of
any of the terms,  conditions  or  provisions  of the certificate  or  articles
of incorporation or by-laws (or other comparable corporate charter documents) of
the  Company or any Subsidiary;

                  (b)   to the Knowledge of Sellers, subject to obtaining the
consents,  approvals  and  actions,  making the  filings  and giving the notices
disclosed in Schedule 3.06(b),  conflict with or result in a violation or breach
of any term or provision of any Law or Order applicable to Sellers,  the Company
or any Subsidiary or any of their respective Assets and Properties the breach of
which would reasonably be expected to have a Material Adverse Effect; or

                  (c)   except as disclosed in Schedule 3.06(c),  or as could
not reasonably be expected to have a Material Adverse Effect,  (i) conflict with
or result in a violation or breach of, (ii)  constitute  (with or without notice
or lapse of time or both) a default under, (iii) require Sellers, the Company or
any  Subsidiary  to obtain any  consent,  approval or action of, make any filing
with or give any  notice to any  Person as a result or under the terms of,  (iv)
result  in or  give  to any  Person  any  right  of  termination,  cancellation,
acceleration  or modification in or with respect to (v) result in or give to any
Person  any  additional   rights  or   entitlement  to  increased,   additional,
accelerated  or  guaranteed  payments  under,  or (vi) result in the creation or
imposition  of any Lien upon  Sellers,  the Company or any  Subsidiary or any of
their respective  Assets and Properties  under, any Material Contract or License
to which  Sellers,  the Company or any  Subsidiary is a party or by which any of
their respective Assets and Properties is bound or any partnership  agreement of
any Tax Credit Partnership or any Operating Partnership.

         3.07.  Governmental  Approvals  and  Filings.  Except as  disclosed  in
Schedule  3.07,  to the  Knowledge  of Sellers  after due  inquiry:  no consent,
approval or action of, filing with or notice to any  Governmental  or Regulatory
Authority on the part of Sellers,  the Company or any  Subsidiary is required in
connection with the execution, delivery and performance of this Agreement or any
of the Operative Agreements to which they are a party or the consummation of the
transactions contemplated hereby or thereby.

         3.08. Financial  Statements.  Prior to the execution of this Agreement,
Sellers have  delivered to Purchaser  true and complete  copies of the following
financial statements:

                  (a)   the  audited  balance  sheets of the  Company and its
consolidated  subsidiaries  as of  December  31,  1996,  1997 and 1998,  and the
related audited consolidated statements of operations,  stockholders' equity and
cash flows for each of the fiscal  years then  ended,  together  with a true and
correct copy of the report on such audited information by PricewaterhouseCoopers
LLP and all letters  from such  accountants  with respect to the results of such
audits; and

                  (b)   the   unaudited  balance  sheets  and  statements  of
operations  of the Company and its  consolidated  subsidiaries  as of the fiscal
quarters  ending March 31, 1999 and June 30,  1999,  and the  unaudited  balance
sheets  and  statement  of  operations  of  the  Company  and  its  consolidated
subsidiaries as of the periods ending July 31, 1999 and August 31, 1999.

Except as set forth in the notes  thereto or in Schedule  3.08,  to the Sellers'
Knowledge,  all such financial  statements were prepared in accordance with GAAP
and  fairly  present  the  consolidated   financial  condition  and  results  of
operations of the Company and its consolidated Subsidiaries as of the respective
dates thereof and for the respective  periods covered thereby,  subject,  in the
case of such Unaudited Financial Statements, to normal year-end adjustments (the
effect of which  will not,  individually  or in the  aggregate,  have a Material
Adverse Effect) and the absence of notes (that,  if presented,  would not differ
materially  from those  included in the  Audited  Financial  Statements  for the
fiscal year ended December 31, 1998).  Except for those  Subsidiaries  listed in
Schedule  3.08,  the  financial  condition  and  results of  operations  of each
Subsidiary are, and for all periods  referred to in this Section 3.08 have been,
consolidated with those of the Company.

         3.09. Absence of Changes. Except for the execution and delivery of this
Agreement and the transactions to take place pursuant hereto,  since the Audited
Financial  Statement  Date, to the Knowledge of Sellers after due inquiry of the
senior management employees of the Company listed in Schedule 3.09(a): there has
not been any  material  adverse  change,  or any  event  or  development  which,
individually or together with other such events, could reasonably be expected to
result in a Material Adverse Effect.  Without limiting the foregoing,  except as
disclosed  in  Schedule  3.09(b),  there has not  occurred  between  the Audited
Financial Statement Date and the date hereof:

                  (i)   any  declaration,  setting  aside or  payment  of any
dividend or other distribution in respect of the capital stock of the Company or
any  Subsidiary  not wholly  owned by the Company  other than cash  dividends or
distributions  to Sellers  which do not reduce  Shareholders'  Equity below $7.5
million, or any direct or indirect redemption,  purchase or other acquisition by
the Company or any  Subsidiary  of any such capital  stock of or any Option with
respect to the Company or any Subsidiary not wholly owned by the Company;

                  (ii)   any   authorization,    issuance,   sale   or   other
disposition  by the Company or any  Subsidiary of any shares of capital stock of
or Option with respect to the Company or any Subsidiary,  or any modification or
amendment of any right of any holder of any outstanding  shares of capital stock
of or Option  with  respect to the  Company or any  Subsidiary  relating to such
capital stock or Option;

                  (iii)   (x)  any increase,  outside of the ordinary course of
business  consistent  with  past  practice,   in  the  salary,  wages  or  other
compensation  of any officer or employee of the Company (other than the Sellers)
or any Subsidiary  whose annual salary is, or after giving effect to such change
would be, $100,000 or more; (y) any  establishment or  modification,  outside of
the ordinary course of business  consistent with past practice,  of (A) targets,
goals,  pools or similar  provisions  in  respect  of any fiscal  year under any
Benefit Plan, employment Contract or other employee compensation  arrangement or
(B) salary ranges,  increase  guidelines or similar provisions in respect of any
Benefit Plan, employment Contract or other employee compensation arrangement; or
(z) any adoption, entering into, amendment, modification or termination (partial
or  complete) of any Benefit  Plan except to the extent  required by  applicable
Law; provided,  however, that this paragraph shall not prohibit the Company from
awarding or paying such  bonuses as Sellers may  determine  prior to the Closing
Date as long as such bonuses are accrued  prior to Closing and  reflected in the
Closing Audit.

                  (iv)   any incurrence by the Company or any Subsidiary of
Indebtedness in an aggregate  principal  amount exceeding $100,000, other than
Indebtedness used to fund loans to Borrowers;

                  (v)   any  physical  damage,  destruction or other casualty
loss not  covered by  insurance  affecting  any of the plant,  real or  personal
property or equipment of the Company or any  Subsidiary  in an aggregate  amount
exceeding $100,000;

                  (vi)   any acquisition or disposition of, or incurrence of a
Lien (other than a Permitted  Lien) on, any Assets and Properties of the Company
or any Subsidiary, other than in the ordinary course of business consistent with
past practice;

                  (vii)   any  (x) amendment of the  certificate or articles of
incorporation or by-laws (or other comparable  corporate  charter  documents) of
the Company or any Subsidiary, (y) reorganization, liquidation or dissolution of
the Company or any Subsidiary or (z) Business Combination  involving the Company
or any Subsidiary and any other Person;

                  (viii)  any commencement or termination by the Company or any
Subsidiary of any line of business;

                  (ix)   any transaction by the Company or any Subsidiary with
Sellers,  any  officer,  director,  Affiliate  or  Associate  of  Sellers or any
Associate of any such officer,  director or Affiliate (other than the Company or
any Subsidiary) (A) outside the ordinary course of business consistent with past
practice or (B) other than on an arm's-length  basis, or (C) other than pursuant
to any Contract in effect on the Audited Financial  Statement Date and disclosed
to  Purchaser  pursuant  to Section  3.17 or (D) other than the  payment of cash
dividends; or

                  (x)   any lease of real property;

                  (xi)  any  notice by Fannie Mae or any beneficiary of MAHGT
of the termination of, or of an intent to terminate or discontinue, any business
relationship which would have a Material Adverse Affect.

         3.10.    Taxes.  Except as disclosed in Schedule 3.10 (with paragraph
references corresponding to those set forth below):

                  (a)   To  Sellers'  Knowledge:  (i)  the  Company  and  its
Subsidiaries  have timely  filed or has had filed,  after  giving  effect to any
applicable  extensions,  all Tax Returns required to be filed by applicable Law,
maintained  all  documents  and records  relating to Taxes as are required to be
made or  provided  by it and has  complied  in all  material  respects  with all
legislation  relating to Taxes  applicable  to it, and (ii) all such Tax Returns
were in all material  respects true,  complete and correct.  The Company and its
Subsidiaries have, within the time and in the manner prescribed by law, paid all
Taxes shown to be due and payable on such Tax Returns.

                  (b)   To Sellers' Knowledge, no claim has ever been made by
any authority of a jurisdiction  where the Company or its Subsidiaries  does not
file Tax Returns  that the Company or its  Subsidiaries  is or may be subject to
taxation by the jurisdiction.

                  (c)   There  are no liens for any Taxes with respect to any
Assets and Properties of the Company or its Subsidiaries except Permitted Liens.

                  (d)   The Company or its Subsidiaries have not requested any
extension  of time within  which to file any Tax Return, which Tax Return has
not since been filed.

                  (e)   The Company or its Subsidiaries have not executed any
outstanding  waivers or comparable  consents regarding the application of the
statute of limitations with respect to any Taxes or Tax Returns.

                  (f)   No deficiency for any Taxes has been proposed, asserted
or assessed against the Company or its Subsidiaries that has not been resolved
and paid in full.

                  (g)   No  audits  or other  administrative  proceedings  or
court  proceedings are presently pending with regard to any Taxes or Tax Returns
of the Company or its Subsidiaries,  and no Governmental  Authority has notified
the Company or any Subsidiary that it intends to audit its Tax affairs.

                  (h)   The  Company and its Subsidiaries have not received a
Tax Ruling or entered into a Closing  Agreement with any Governmental  Authority
that would have a Material  Adverse Effect upon the Company or its  Subsidiaries
after the date of Closing.

                  (i)   To Sellers' Knowledge, no event, transaction,  act or
omission  has  occurred  which could  result in the Company or its  Subsidiaries
becoming  liable  to pay  or to  bear  any  Tax as a  transferee,  successor  or
otherwise which is primarily or directly chargeable or attributable to any other
Person.

                  (j)   To   Seller's   Knowledge,   the   Company   and  its
Subsidiaries  have  complied  (and until the date of Closing will comply) in all
material  respects  with the  provisions of the Code relating to the payment and
withholding  of  Taxes,  including,  without  limitation,  the  withholding  and
reporting  requirements  under Code ss.ss.1441  through 1446, 3401 through 3606,
and 6041 and 6049,  as well as  similar  provisions  under any other  applicable
Laws, and has, within the time and in the manner prescribed by Law, withheld and
paid  over to the  proper  Governmental  Authorities  all  amounts  required  in
connection with amounts paid or owing to any employee.

                  (k)   The  Company or its  Subsidiaries  are not parties to
any agreement,  contract, or arrangement that would result, separately or in the
aggregate,  in the payment of any "excess parachute payments" within the meaning
of Code ss.280G.

                  (l)   The  Company and its Subsidiaries have not filed (and
will not file prior to the  Closing) a consent  pursuant  to Code  ss.341(f)  or
agreed to have Code  ss.341(f)(2)  apply to any  disposition of a subsection (f)
asset (as that term is defined in Code ss.341(f)(4)) owned by the Company or its
Subsidiaries.

                  (m)   The  Company and its Subsidiaries are not required to
include in income  any  adjustment  pursuant  to Code  ss.481(a)  by reason of a
voluntary  change  in  accounting   method  initiated  by  the  Company  or  its
Subsidiaries,  and to the knowledge of Sellers and the Company,  the IRS has not
proposed any such adjustment or change in accounting method.

                  (n)   No election under Codess.338 (or any predecessor
provisions) has been made with respect to any of the Assets and Properties of
the Company or its Subsidiaries.

                  (o)   The Company and its  Subsidiaries  are not subject to
any Tax sharing or similar  agreements under which the
Company, its Subsidiaries or the Purchaser may have liability for Taxes of any
other Person.

                  (p)   Sellers have made available to Purchaser for calendar
years 1996, 1997 and 1998 complete and accurate copies of (i) all federal income
tax  returns,  and  any  amendments  thereto,  filed  by  the  Company  and  its
Subsidiaries,  (ii) all audit reports received from any  Governmental  Authority
relating  to any  federal  income tax return  and (iii) all  Closing  Agreements
entered into by the Company or its Subsidiaries with any Governmental Authority.

         3.11.    Legal Proceedings.  Except as disclosed in Schedule 3.11 (with
 paragraph references  corresponding to those set forth below):

                  (a)   there  are no Actions or  Proceedings  pending or, to
the  Knowledge  of  Sellers,  threatened  against,  Sellers,  the Company or any
Subsidiary  or any of their  respective  Assets and  Properties  which (i) could
reasonably  be  expected  to result  in the  issuance  of an Order  restraining,
enjoining or otherwise  prohibiting or making illegal the consummation of any of
the  transactions  contemplated  by  this  Agreement  or any  of  the  Operative
Agreements  or  otherwise  result  in a  material  diminution  of  the  benefits
contemplated by this Agreement or any of the Operative  Agreements to Purchaser,
or (ii) if determined adversely to Sellers,  the Company or a Subsidiary,  could
reasonably be expected to result in (x) any injunction or other equitable relief
against the  Company or any  Subsidiary  that would  interfere  in any  material
respect  with its  business  or  operations  or (y) Losses by the Company or any
Subsidiary, individually exceeding $100,000; and

                  (b)   to the Knowledge of Sellers', there are no Orders
outstanding against the Company or any Subsidiary.

Prior to the execution of this  Agreement,  Sellers have delivered to Purchaser,
or made available to Purchaser, all responses of counsel for the Company and the
Subsidiaries to auditors' requests for information  delivered in connection with
the Audited  Financial  Statements  (together with any updates  provided by such
counsel)  regarding  Actions or  Proceedings  pending or threatened  against the
Company or any Subsidiary.

         3.12.  Compliance With Laws and Orders. Except as disclosed in Schedule
3.12, to Sellers'  Knowledge neither the Company nor any Subsidiary has received
any  written  notice  that it is in  violation  of or in default  under,  in any
material  respect,  any Law or Order applicable to the Company or any Subsidiary
or any of their  respective  Assets and  Properties the violation of which could
reasonably be expected to have a Material Adverse Effect.

         3.13.    Benefit Plans; ERISA.

                  (a)   Schedule  3.13(a)  (i)  contains a true and  complete
list and  description of each of the Benefit Plans,  (ii) identifies each of the
Benefit Plans that is a Qualified  Plan, and (iii)  identifies each of the Plans
that are fully  insured.  To  Seller's  knowledge:  neither  the Company nor any
Subsidiary  has scheduled or agreed upon future  increases of benefit levels (or
creations of new benefits)  with respect to any Plan,  and no such  increases or
creation of benefits have been proposed,  made the subject of representations to
employees or requested or demanded by employees under  circumstances  which make
it reasonable to expect that such increases will be granted.

                  (b)   Neither  the  Company  nor any ERISA  Affiliate,  or any
predecessor  thereof,  has at any time  during the five-year period preceding
the date of this Agreement, maintained or contributed to a Defined Benefit Plan.

                  (c)   Neither  the Company nor any Subsidiary  maintains or
is obligated to provide  benefits under any life,  medical or health plan (other
than as an incidental benefit under a Qualified Plan) which provides benefits to
retirees or other terminated  employees other than benefit  continuation  rights
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

                  (d)   Neither  the  Company,  any  Subsidiary,   any  ERISA
Affiliate  nor any other  corporation  or  organization  controlled  by or under
common  control with any of the  foregoing  within the meaning of Section 414 of
the Code, has at any time contributed to any  "multiemployer  plan" as that term
is defined in Section 3(37) of ERISA.

                  (e)   To Seller's Knowledge,  each of the Benefit Plans is,
and its administration is and has been since inception, in all material respects
in substantial  compliance  with, and neither the Company nor any Subsidiary has
received  any  claim or notice  that any such  Benefit  Plan is not in  material
compliance  with, all applicable  Laws and Orders,  (including all tax rules for
which favorable tax treatment is intended), without limitation, the requirements
of ERISA,  the Code,  the Age  Discrimination  in Employment  Act (to the extent
applicable),  the Equal Pay Act (to the extent  applicable) and Title VII of the
Civil Rights Act of 1964 (to the extent applicable).  To the Sellers' knowledge,
each  Qualified  Plan as of the  Closing  Date,  has met  the  requirements  for
qualification under Section 401(a) of the Code.

                  (f)   To  Seller's  Knowledge,  (i)  neither  Sellers,  the
Company nor any  Subsidiary  is in  material  default in  performing  any of its
contractual  obligations  under any of the Benefit  Plans or any  related  trust
agreement or  insurance  contract,  (ii) all  contributions  and other  payments
required to be made by Sellers,  the  Company or any  Subsidiary  to any Benefit
Plan with  respect to any  period  ending on the date  hereof  have been made or
reserves adequate for such  contributions or other payments have been or will be
set aside therefor and have been or will be reflected in Financial Statements in
accordance  with GAAP,  and (iii) there are no material  Liabilities of or under
any Benefit Plan other than  Liabilities for benefits to be paid to participants
in such Benefit Plan and their  beneficiaries  in  accordance  with the terms of
such Benefit Plan.

                  (g)   To the Sellers' Knowledge, no event has occurred, and
there exists no condition or set of circumstances in connection with any Benefit
Plan,  under which the Company,  any Subsidiary or any Plan  maintained by them,
directly or indirectly  (through any  indemnification  agreement or  otherwise),
could  reasonably  be expected  to be subject to any risk of material  liability
(including,  without limitation,  liability under Sections 406, 409 or 502(i) of
ERISA,  Title  IV of ERISA  or  Section  4975 of the  Code)  other  than to make
contributions or to pay benefits in the ordinary course.

                  (h)   To the Knowledge of Sellers,  there are no pending or
threatened  claims  (other than routine  claims for benefits) by or on behalf of
any Benefit  Plan, by any person  covered  thereby,  or otherwise,  which allege
violations of Law which would  reasonably be expected to have a Material Adverse
Effect.

                  (i)   No  employer real property or other employer property
is included in the assets of any Benefit Plan.

                  (k)   Neither the Company nor any ERISA Affiliate maintains
any severance or parachute payment plan.

                  (l)   MAHGT  is the only entity in which the  Sellers,  the
Company or its Subsidiaries participate as fiduciaries which has been created to
make  multifamily  mortgage loans.  Sellers have not received any written notice
that  the  Trust or any  other  Benefit  Plan  for  which  the  Company  and its
Subsidiaries have originated loans is subject to ERISA.

                  (m)   To  Seller's  Knowledge,  the  Trust  and  any  other
Benefit Plans for which the Company and its  Subsidiaries  have originated loans
and which are not subject to ERISA have, to the extent  managed by Sellers,  the
Company or its  Subsidiaries,  been managed in  compliance  with the  applicable
requirements  of any and all  applicable  state,  local and  foreign  laws which
govern plan fiduciaries or which are otherwise similar to ERISA.

                  (n)   Purchaser and its Affiliates,  including on and after
the Closing, the Company and any Subsidiary, shall have no liability for, under,
with respect to or otherwise in connection with any Plan, which liability arises
under  ERISA or the Code,  by  virtue of the  Company  or any  Subsidiary  being
aggregated,  at any relevant time prior to the Closing, in a controlled group or
affiliated  service  group  with any ERISA  Affiliate  that  does not  become an
affiliate of the Purchaser by virtue of the transactions contemplated hereby. No
Plan other than a Benefit Plan is or will be directly or  indirectly  binding on
Purchaser by virtue of the transactions contemplated hereby.

                  (o)   To   Seller's   Knowledge,   the   Company  and  each
Subsidiary  has  properly  classified  for  all  purposes  (including,   without
limitation,  for all Tax purposes and for purposes of determining eligibility to
participate  in any employee  benefit  plan) all  employees,  leased  employees,
consultants and independent contractors.

         3.14.    Real Property.

                  (a)   Neither  the  Company  nor any  Subsidiary  owns any
real  property.  Schedule  3.14(a)  contains a true and correct list of each
parcel of real property leased by the Company or any Subsidiary (as lessee).

                  (b)   To   the  Sellers'   Knowledge,   the  Company  or  a
Subsidiary has a valid and subsisting leasehold estate in and the right to quiet
enjoyment  of the real  properties  leased  by it for the full term of the lease
thereof.  To the Sellers'  Knowledge,  each lease  referred to in paragraph  (a)
above is a legal,  valid and binding  agreement,  enforceable in accordance with
its terms,  of the Company or a Subsidiary  and, except as set forth in Schedule
3.14(b),  and neither the Company nor any Subsidiary has received written notice
of any,  default  thereunder.  Neither the Company nor any  Subsidiary  owes any
brokerage commissions with respect to any such leased space.

                  (c)   Sellers  have  delivered  to  Purchaser  prior to the
execution of this  Agreement true and complete  copies of all leases  (including
any amendments and renewal  letters) with respect to the real property listed in
Schedule 3.14(a).

         3.15.  Tangible  Personal  Property.  The Company or a Subsidiary is in
possession  of and has good  title to, or has valid  leasehold  interests  in or
valid rights under Contract to use, all tangible  personal  property used in the
conduct of their business, including all tangible personal property reflected on
the balance sheet included in the Unaudited Financial  Statements for the period
ended on the Unaudited  Financial  Statement Date and tangible personal property
acquired  since the  Unaudited  Financial  Statement  Date other  than  property
disposed of since such date in the ordinary  course of business  consistent with
past  practice.  All such  tangible  personal  property is free and clear of all
Liens, other than Permitted Liens and Liens disclosed in Schedule 3.15.

         3.16.  Intellectual  Property Rights.  The Company and the Subsidiaries
have interests in or use the Intellectual  Property  disclosed in Schedule 3.16,
to the Sellers' Knowledge,  each of which the Company or a Subsidiary either has
all right,  title and interest in or a valid and binding  license to use. Except
as disclosed in Schedule 3.16 or in the terms of any written license  previously
delivered to or reviewed by Purchaser, to the Sellers' Knowledge,  (i) there are
no  restrictions  on the direct or  indirect  transfer  of any  license,  or any
interest  therein,  held by the  Company  or any  Subsidiary  in respect of such
Intellectual  Property,  (ii)  Sellers  have  delivered  or  made  available  to
Purchaser prior to the execution of this Agreement all material documentation in
Seller's  possession with respect to any invention,  process,  design,  computer
program  or  other  know-how  or  trade  secret  included  in such  Intellectual
Property,  (iii) neither the Company nor any Subsidiary has received any written
notice  that it is,  in  default  under  any  license  to use such  Intellectual
Property, and (iv) to the Sellers' Knowledge,  such Intellectual Property is not
being  infringed by any other Person so as to cause a Material  Adverse  Effect.
Neither Sellers, the Company nor any Subsidiary has received written notice that
the Company or any  Subsidiary is infringing  any  Intellectual  Property of any
other Person,  no written claim is pending or, to the Knowledge of Sellers,  has
been made to such effect that has not been resolved.

         3.17.    Contracts.

                  (a)   Schedule    3.17(a)   (with   paragraph    references
corresponding  to those set forth below)  contains a true and  complete  list of
each of the following  Contracts  ("Material  Contracts") or other  arrangements
(true and complete copies or, if none,  reasonably complete and accurate written
descriptions of which,  together with all amendments and supplements thereto and
all waivers of any terms  thereof,  have been  delivered to or made available to
Purchaser prior to the execution of this Agreement), to which the Company or any
Subsidiary is a party or by which any of their respective  Assets and Properties
is bound:

                     (i)  (A) all Contracts  (excluding  Benefit Plans and
"at will"  employment  agreements)  providing  for a commitment of employment or
consultation  services for a specified or unspecified  term, the name,  position
and  rate of  compensation  of each  Person  party  to such a  Contract  and the
expiration date of each such Contract;  and (B) any unwritten  promises known to
Sellers  which create an  obligation  of the Company or any  Subsidiary  to make
payments  in  any  year,   other  than  with  respect  to  salary  or  incentive
compensation payments in the ordinary course of business.

                     (ii)     all Contracts  with any Person  containing  any
provision or covenant  prohibiting  or limiting the ability of the Company or
any  Subsidiary to engage in any business  activity or compete with any Person
or prohibiting or limiting the ability of any Person to compete with the Company
or any Subsidiary;

                     (iii)    all partnership,  joint venture,  shareholders'
or other similar  Contracts with any Person (other than the partnership or
similar agreement of any Operating Partnership);

                     (iv)     all  Contracts  relating to  Indebtedness  of the
Company or any  Subsidiary  in excess of $100,000 (other than Indebtedness owing
by the Company or any wholly-owned Subsidiary used to fund loans to Borrowers);

                      (v)      all collective bargaining or similar labor
Contracts;

                     (vi)   all  Contracts   that  (A)  limit  or  contain
restrictions  on the ability of the Company or any  Subsidiary to declare or pay
dividends  on,  to make any  other  distribution  in  respect  of or to issue or
purchase,  redeem or otherwise acquire its capital stock, to incur Indebtedness,
to incur or suffer  to exist  any  Lien,  to  purchase  or sell any  Assets  and
Properties,  to change the lines of business in which it participates or engages
or to engage in any  Business  Combination  or (B)  require  the  Company or any
Subsidiary  to  maintain  specified  financial  ratios or levels of net worth or
other indicia of financial condition;

                     (vii)    all Contracts  between or among the Company or any
Subsidiary or the Trust on the one hand and any of the Sellers on the other
hand;

                     (viii)  all  other  Contracts  that (A)  involve  the
payment or potential payment,  pursuant to the terms of any such Contract, by or
to the  Company  or any  Subsidiary  of more than  $1,000,000  and (B) cannot be
terminated  within 30 calendar days after giving notice of  termination  without
resulting in any material cost or penalty to the Company or any Subsidiary; and

                     (ix)     to the extent not otherwise  covered by clauses
(i) to (viii)  above,  all written  Contracts  with Fannie Mae, HUD,  GNMA, FHLA
or MAHGT and all other  Contracts  pursuant to which the Company or any
Subsidiary  originates,  sells or services mortgage loans.

                  (b)   Each  Material  Contract  required to be disclosed in
Schedule 3.17(a) is in full force and effect and constitutes a legal,  valid and
binding agreement, enforceable against the Company or a Subsidiary to the extent
a party  thereto  in  accordance  with its  terms,  except as may be  limited by
applicable bankruptcy, insolvency,  reorganization,  recharacterization or other
similar laws  affecting  creditor's  rights  generally and by general  equitable
principles  (regardless  of whether  considered  in a proceeding in equity or at
law);  and except as disclosed in Schedule  3.17(b)  neither the Company nor any
Subsidiary has received  written notice (i) that it is in violation or breach of
or default under any such Material  Contract (or with notice or lapse of time or
both,  would be in  violation  or breach of or default  under any such  Material
Contract),  or (ii) that any other party to a Material Contract claims that such
Contract is not its legal,  valid and  binding  obligation  or is  unenforceable
against such other party.

         3.18. Licenses.  Schedule 3.18 contains a true and complete list of all
Licenses  used in and material to the business or  operations  of the Company or
any Subsidiary. Prior to the execution of this Agreement, Sellers have delivered
to or made available to Purchaser  true and complete  copies of all such written
Licenses. Except as disclosed in Schedule 3.18:

                  (i)   to the Sellers'  Knowledge,  each License  listed in
Schedule  3.18 is valid,  binding and in full force and effect;

                  (ii)  to the  Seller's  Knowledge,  the Company and each
Subsidiary  hold all Licenses the absence of which would have a Material Adverse
Effect; and

                  (iii) neither the Company nor any  Subsidiary  is, or has
received any written notice that it is, in default under any such License.

         3.19. Insurance. Schedule 3.19 contains a true and complete list of all
liability,  property, workers' compensation,  directors' and officers' liability
and other  insurance  policies  currently  in effect that  insure the  business,
operations or employees of the Company or any Subsidiary. The insurance coverage
provided by the  policies  described  in clause (i) above will not  terminate or
lapse by reason of the transactions contemplated by this Agreement.  Neither the
Company nor any Subsidiary has received notice that any insurer under any policy
referred  to in this  Section  is  denying  liability  with  respect  to a claim
thereunder or defending under a reservation of rights clause.

         3.20.    Employees; Labor Relations.

                  (a)   Schedule  3.20  contains  a list of the  name of each
officer and full-time  employee of the Company and the  Subsidiaries at the date
hereof,  together  with each such  person's  position or  function,  annual base
salary or wages and any  incentive  or bonus  arrangement  with  respect to such
person in effect on such date.

                  (b)   (i)  To the  Sellers'  Knowledge,  no employee of the
Company or any Subsidiary is presently a member of a collective  bargaining unit
and,  to the  Knowledge  of Sellers,  there are no  threatened  or  contemplated
attempts to organize for collective  bargaining purposes any of the employees of
the Company or any Subsidiary; and (ii) except as set forth in Schedule 3.20(b),
no unfair labor practice complaint or sex or age discrimination claim is pending
against  the  Company  or any of the  Subsidiaries  before  the  National  Labor
Relations Board or any other Governmental or Regulatory  Authority.  There never
has been any  work  stoppage  or  strike  by  employees  of the  Company  or any
Subsidiary.  Since January 1, 1997,  the Company and the  Subsidiaries  have not
received any written notice of  noncompliance  with  applicable Laws relating to
the employment of labor,  including without  limitation those relating to wages,
hours and collective bargaining.

                  (c)   Except for employees who are parties to employment
Contracts listed on Schedule  3.17(a),  all employees of the Company and its
Subsidiaries are "at-will" employees.

         3.21.    Substantial Business Relationships.

                  (a)   Schedule  3.21(a) lists the largest  investors in tax
credit  funds  and  projects  sponsored  or  arranged  by the  Company  and  its
Subsidiaries. Except as disclosed in Schedule 3.21(a), to Sellers' Knowledge: no
such investor has ceased or materially  reduced its  relationship  or investment
with the Company and the  Subsidiaries  since the  Audited  Financial  Statement
Date,  or to the  Knowledge of Sellers,  has  threatened  to cease or materially
reduce its  relationship,  or such investment with the Company or any Subsidiary
after the date hereof.

                  (b)   Schedule  3.21(b) lists all Persons for whose benefit
or at whose  request the Company or its  Subsidiaries  have made loans which are
presently  outstanding  or  have  arranged  tax  credit  investments  which  are
presently  outstanding  which in the  aggregate  exceed  $10,000,000.  Except as
disclosed in Schedule  3.21(b),  to the Knowledge of Sellers,  no such Person is
threatened with bankruptcy or insolvency.

                  (c)   To  the Knowledge of Sellers after due inquiry of the
senior  management  employees  of the  Company  and its  Subsidiaries  listed on
Schedule  3.21(c),  the Company and its  Subsidiaries  are in  compliance in all
material respects with all agreements with any of Fannie Mae, GNMA, HUD or FHLA,
and neither the Sellers,  the Company nor any  Subsidiary  has received  written
notice of any material noncompliance with the handbooks,  manuals and guidelines
applicable  to  FannieMae  DUS  lenders  or  seller/servicers,  GNMA  lenders or
seller/services,   HUD   lenders  or   seller/servicers   or  FHLA   lenders  or
seller/servicers.

                  (d)   Neither  Sellers, the Company, nor any Subsidiary has
received any written notice from Fannie Mae,  GNMA,  HUD or FHLA,  respectively,
stating or indicating that the Company or any Subsidiary was or is in default in
its   obligations  to  or  agreements  with  Fannie  Mae,  GNMA,  HUD  or  FHLA,
respectively;  and Sellers  have no Knowledge of any facts or events which would
entitle or give Fannie Mae, GNMA, HUD or FHLA,  respectively  cause to terminate
MMI as an approved DUS lender or GNMA, HUD or FHLA lender, respectively.

                  (e)   Except as listed on Schedule 3.21(e),  Fannie Mae has
not sent the Company or any  Subsidiary  notice of any default or  deficiency in
MMI's performance as a DUS lender or Fannie Mae approved seller/servicer. Except
as listed on Schedule  3.21(e),  neither GNMA, HUD nor FHLA has sent the Company
or any Subsidiary  notice of any default or deficiency in MMI's performance as a
lender  or  seller/servicer.   To  Seller's  knowledge,   the  Company  and  its
Subsidiaries  are in full  compliance  with all net  worth,  reserve,  and other
financial conditions required by FannieMae..

                  (f)   Neither  Sellers, the Company, nor any Subsidiary has
received any written notice from any  beneficiary of MAHGT asserting or claiming
any of the following on the part of the Sellers,  the Company or any Subsidiary:
(i) breach of any Contract with, or duty of care owed to, MAHGT, or (ii) failure
to comply in any material respect with any agreement entered into with MAHGT.

                  (g)   Neither  Sellers,  the Company nor any Subsidiary has
received notice from any beneficiary of MAHGT that such  beneficiary  intends to
withdraw from the Trust.

         3.22.  No Powers of  Attorney.  Except as set forth in  Schedule  3.22,
neither the Company nor any  Subsidiary has any powers of attorney or comparable
delegations of authority outstanding.

         3.23  Assets.  Neither  Sellers,  the  Company nor any  Subsidiary  has
received  written notice that the Company or any Subsidiary or any  counterparty
is in violation  of or in default  under,  in any material  respect any material
loan or credit agreement, note, bond, mortgage, indenture or any material lease,
permit,  concession,  franchise or license, or any material agreement to acquire
real property, or any other material Contract to which it is a party or by which
it or any of its  properties  or assets  is  bound,  except  for  violations  or
defaults that would not, individually  reasonably be expected to have a Material
Adverse Effect.

         3.24.  Brokers.  Except for FPL  Associates  Finance L.P.,  whose fees,
commissions  and  expenses  are  the  sole   responsibility   of  Sellers,   all
negotiations relative to this Agreement and the transactions contemplated hereby
have  been  carried  out  by  Sellers   directly  with  Purchaser   without  the
intervention  of any Person on behalf of Sellers in such  manner as to give rise
to  any  valid  claim  by any  Person  against  Purchaser,  the  Company  or any
Subsidiary for a finder's fee, brokerage commission or similar payment.

         3.25.  Year 2000  Compliance.  The  Company and its  Subsidiaries  have
reviewed  and  tested  all  computer  hardware  and  software  applications  and
date-sensitive  equipment  controlled  by  imbedded  computer  chips in order to
determine  whether  such  systems  are year  2000  compliant  to the  extent  of
technological resources currently available to the Company and its Subsidiaries.
To the best of  Sellers'  Knowledge  the  systems  used by the  Company  and its
Subsidiaries  will be year 2000  compliant by December 31, 1999. For purposes of
this Section,  year 2000 compliant means all hardware and software  applications
and  date-sensitive   equipment   controlled  by  imbedded  computer  chips  can
accurately  process  date  and  time  data  (including,   but  not  limited  to,
calculating, comparing and sequencing) from, into, and between the twentieth and
twenty-first centuries, and the years 1999 and 2000, including correct leap year
calculations. Furthermore, year 2000 compliant systems, when used in combination
with all other information systems,  shall accurately process date and time data
if the other systems properly exchange date and time data with it.

         3.26.    Status of Outstanding Loans.

                  (a)   Schedule  3.26(a) is a complete  list as of September
1,  1999  of  all  permanent   loans  being  serviced  by  the  Company  or  its
Subsidiaries,  and indicates for each such loan the name of the party which owns
such loan (or a participation interest therein).

                  (b)   Schedule  3.26(b) is a complete  list as of September
1, 1999 of all outstanding construction loans which have been closed (i.e., loan
documents  have been executed and a mortgage or deed of trust has been recorded)
by the  Company  or its  Subsidiaries,  and  indicates  in each  case the  party
providing the funds from which such loan was funded.

                  (c)   Schedule   3.26(c)   is  a   complete   list  of  all
outstanding commitments for construction loans as of September 1, 1999 issued by
the Company or its Subsidiaries,  and indicates in each case the party from whom
the funds will be obtained to fund such loan.

                  (d)   Schedule   3.26(d)   is  a   complete   list  of  all
outstanding  commitments  for permanent  loans as of September 1, 1999 issued by
the  Company  or its  Subsidiaries,  (whether  in its own behalf or on behalf of
another party, such as MAHGT) and indicates in each case the proposed  permanent
lender and the  intended  disposition  of such loan  (e.g.,  sale to Fannie Mae,
etc.).

                  (e)   Schedule  3.26(e)  is a  complete  list of all  loans
originated or serviced by the Company or its Subsidiaries which is currently (as
of  September 1, 1999)  identified  as a  non-performing,  "watch list" or other
similarly classified loan.

                  (f)   Schedule  3.26(f) is a complete list of all permanent
loans  owned or  serviced  by the  Company  or its  Subsidiaries  for  which the
underlying  borrower or project has a debt service  coverage  ratio of less than
1.10 to 1.0,  based upon the most recent  financial  reporting  available to the
Company or its Subsidiaries as of September 1, 1999.

                  (g)   Schedule  3.26(g)  is a  complete  list of all  loans
owned or  serviced  by the Company or its  Subsidiaries  for which,  in Sellers'
reasonable and good faith judgment,  based on information currently available to
Sellers,  the Company or its Subsidiaries may be required to make delinquency or
servicing  advances  during the next 12  months,  or which may be unable to meet
scheduled debt service requirements during such period.

                  (h)   Schedule  3.26(h) lists all construction  loans owned
or  serviced  by the  Company or its  Subsidiaries  for which the Sellers or the
Company  has reason to believe  that the  remaining  loan  proceeds  will not be
sufficient  to complete  the  construction  of the project free and clear of all
liens, claims and encumbrances.

                  (i)   Except as disclosed in Schedule 3.26(i),  the Company
or the applicable  Subsidiary  received a lender's  policy of title insurance in
connection with all loans made by the Company and its  Subsidiaries  and secured
by real property and each owner of a low income housing tax credit  property for
which the Company or any  Subsidiary  arranged the tax credit equity  investment
received an owner's  policy of title  insurance,  in an amount not less than the
loan amount or the total amount invested in the property respectively.

         3.27.    Status of Tax Credit Transactions.

                  (a)   Except as disclosed on Schedule 3.27(a), the Sellers,
the  Company  and  its   Subsidiaries   have  received  no  written  notices  or
communications (from the IRS, any state housing finance authority,  or any other
party) to the effect (i) that any Affiliate of the Sellers or the Company, is in
default under the organizational  documents of any Tax Credit Partnership or any
Operating  Partnership  in any  material  respect;  or (ii)  that any  event has
occurred which would cause any Operating  Partnership or Tax Credit  Partnership
not to realize its reasonably anticipated tax credits.

                  (b)   Except as disclosed in Schedule 3.27(b),  to Sellers'
Knowledge, each property with respect to which the Company or any Subsidiary has
made a loan or arranged a tax credit equity investment is in compliance with all
income  requirements and rent limitations imposed on such property or the owners
thereof by any agreement, restrictive covenant or applicable Law in all material
respects.

                  (c)   Attached  as Schedule  3.27(c),  is a  comparison  of
original  projected  benefits with current projected benefits for cash investors
in Midland Corporate Tax Credit Partnerships I - IV. No investor in a Tax Credit
Partnership has notified the Company or its Subsidiaries that it is dissatisfied
with its actual or projected returns.

         3.28.  No  Undisclosed  Liabilities.  Except as  reflected  or reserved
against in the balance sheet included in the Audited Financial  Statements or in
the notes thereto or as disclosed in Schedule 3.28,  there are, to the Knowledge
of Sellers after due inquiry of senior management  employees of the Company,  no
Liabilities  against,  relating to or affecting the Company or any Subsidiary or
any of their respective Assets and Properties,  other than Liabilities which are
incurred in the ordinary  course of business  consistent  with past practice and
which  in the  aggregate  would  not  have a  Material  Adverse  Effect.  To the
Knowledge  of Sellers,  all facts  material to the  Business or Condition of the
Company  and its  Subsidiaries  have  been  disclosed  to  Purchaser  in,  or in
connection with, this Agreement and the Schedules.

         3.29. Affiliate Transactions.  Except as disclosed Schedule 3.29, as of
the date of this Agreement,  there are no intercompany  Liabilities  between the
Company or any Subsidiary or the Trust, on the one hand, and any of the Sellers,
on the other, which would survive Closing.

         3.30.  Books and  Records.  The  minute  books,  contracts,  documents,
instruments and similar records of the Company and the  Subsidiaries  which have
been made available to Purchaser are genuine and are true, complete and accurate
copies of the Company's records.

         3.31.  Qualification to do Business.  Except as shown on Schedule 3.31,
neither the Company nor any  Subsidiary  has  received  written  notice from any
state that the  Company or any  Subsidiary  is subject to any fine,  forfeiture,
diminution of rights or similar penalty for failure to qualify to do business in
such state.

         3.32. Environmental Matters. Except as shown on Schedule 3.32 or on any
Phase I environmental  report received by the Company or any Subsidiary and made
available to Purchaser, neither the Sellers, the Company, nor any Subsidiary has
received  written  notice that any  property  with respect to which the Company,
MAGHT or any  Subsidiary  has made a loan or arranged a  low-income  housing tax
credit investment is in violation of any Environmental Law.

         3.33.    Watch List.  Schedule 3.33 is a true and correct copy of the
Company's  "watch" list of Operating  Partnerships  and Borrower loans as of
August 31, 1999.

         EXCEPT AS SPECIFICALLY SET FORTH HEREIN, ALL OTHER  REPRESENTATIONS AND
WARRANTIES, EXPRESSED OR IMPLIED, ARE HEREBY WAIVED AND DISCLAIMED.

                                   ARTICLE IV
                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

         Purchaser hereby represents and warrants to Sellers as follows:

         4.01.  Organization.  Purchaser  is a limited  liability  company  duly
organized,  validly existing and in good standing under the Laws of the State of
Delaware.  Purchaser has full limited  liability  company power and authority to
execute and deliver this Agreement and the Operative Agreements to which it is a
party, to perform its obligations hereunder and thereunder and to consummate the
transactions  contemplated  hereby and  thereby.  Purchaser  is duly  qualified,
licensed or admitted to do business and is in good standing in all jurisdictions
in which the  ownership,  use or leasing of its  Assets and  Properties,  or the
conduct  or nature of its  business,  makes  such  qualification,  licensing  or
admission  necessary  and in which the failure to be so  qualified,  licensed or
admitted and in good  standing  could  reasonably be expected to have an adverse
effect  on the  validity  or  enforceability  of  this  Agreement  or any of the
Operative  Agreements  to which it is a party or on the ability of  Purchaser to
perform its obligations hereunder or thereunder.

         4.02.  Authority.  The  execution  and  delivery by  Purchaser  of this
Agreement  and  the  Operative  Agreements  to  which  it is a  party,  and  the
performance by Purchaser of its obligations hereunder and thereunder,  have been
duly and validly  authorized  by the Board of Directors of  Purchaser,  no other
limited  liability  company action on the part of Purchaser or its  stockholders
being necessary  other than approval prior to Closing by Purchaser's  Investment
Committee of any changes in this Agreement and the Operative Agreements from the
drafts presented to the Board at its September 22, 1999 meeting.  This Agreement
has been duly and validly  executed and delivered by Purchaser and  constitutes,
and upon the execution and delivery by Purchaser of the Operative  Agreements to
which it is a party, such Operative Agreements will constitute, legal, valid and
binding  obligations of Purchaser  enforceable  against  Purchaser in accordance
with their respective  terms,  subject only to ratification  prior to Closing by
Purchaser's Investment Committee.

         4.03.  Issuance of Purchaser  Common Shares The Purchaser Common Shares
to be issued to Sellers by Purchaser  pursuant to this  Agreement have been duly
authorized   and  will  upon  issuance  be  validly   issued,   fully  paid  and
nonassessable  and will not be  subject  to any  preemptive  rights  created  by
statute, Purchaser's Amended and Restated Certificate of Formation and Operating
Agreement,  by-laws, or other equivalent  organizational  documents or any other
agreement.  The  Purchaser  Common  Shares  issued to Sellers  pursuant  to this
Agreement shall be free of any Liens or other defects in title.

         4.04.  No  Conflicts.  The  execution and delivery by Purchaser of this
Agreement do not, and the  execution  and delivery by Purchaser of the Operative
Agreements  to  which  it is a  party,  the  performance  by  Purchaser  of  its
obligations  under  this  Agreement  and  such  Operative   Agreements  and  the
consummation of the transactions contemplated hereby and thereby will not:

                  (a)   conflict  with or result in a violation  or breach of
any  of  the  terms,  conditions  or  provisions  of the  Amended  and  Restated
Certificate of Formation and Operating Agreement or by-laws of Purchaser;

                  (b)   subject  to obtaining  the  consents,  approvals  and
actions,  making the filings and giving the notices  disclosed in Schedule  4.05
hereto,  conflict  with or  result  in a  violation  or  breach  of any  term or
provision of any Law or Order  applicable  to Purchaser or any of its Assets and
Properties; or

                  (c)   except  as  disclosed in Schedule  4.04  hereto,  (i)
conflict  with or result in a violation or breach of, (ii)  constitute  (with or
without  notice  or  lapse  of time or  both) a  default  under,  (iii)  require
Purchaser to obtain any consent,  approval or action of, make any filing with or
give any notice to any Person as a result or under the terms of, or (iv)  result
in the creation or  imposition  of any Lien upon  Purchaser or any of its Assets
and Properties  under,  any Contract or License to which Purchaser is a party or
by which any of its Assets and Properties is bound.

         4.05.  Governmental  Approvals  and  Filings.  Except as  disclosed  in
Schedule 4.05 hereto,  no consent,  approval or action of, filing with or notice
to any Governmental or Regulatory Authority on the part of Purchaser is required
in connection with the execution,  delivery and performance of this Agreement or
the  Operative  Agreements  to which it is a party  or the  consummation  of the
transactions contemplated hereby or thereby.

         4.06. Legal  Proceedings.  There are no Actions or Proceedings  pending
or, to the knowledge of Purchaser,  threatened against, relating to or affecting
Purchaser or any of its Assets and Properties which could reasonably be expected
to  result in the  issuance  of an Order  restraining,  enjoining  or  otherwise
prohibiting  or  making  illegal  the  consummation  of any of the  transactions
contemplated by this Agreement or any of the Operative Agreements.

         4.07. Purchase for Investment. The Shares will be acquired by Purchaser
(or, if  applicable,  its  assignee  pursuant to Section  11.10(b))  for its own
account for the purpose of  investment,  it being  understood  that the right to
dispose of such  Midland  Shares  shall be  entirely  within the  discretion  of
Purchaser (or such assignee,  as the case may be).  Purchaser (or such assignee,
as the case may be) will refrain from transferring or otherwise disposing of any
of the Shares, or any interest therein, in such manner as to cause Sellers to be
in violation of the registration  requirements of the Securities Act of 1933, as
amended, or applicable state securities or blue sky laws.

         4.08.  Brokers.  Except for Robert A. Stanger & Co., Inc.,  whose fees,
commissions  and  expenses  are  the  sole  responsibility  of  Purchaser,   all
negotiations relative to this Agreement and the transactions contemplated hereby
have  been  carried  out  by  Purchaser   directly  with  Sellers   without  the
intervention of any Person on behalf of Purchaser in such manner as to give rise
to any valid claim by any Person against Sellers,  the Company or any Subsidiary
for a finder's fee, brokerage commission or similar payment.

         4.09  Disclosure.   Purchaser  has  kept  current  public   information
available  within  the  meaning  of Rule  144(c)  of the  regulations  under the
Securities Act.  Purchaser has prior to the date hereof,  and will file with the
Securities  and Exchange  Commission  ("SEC") in a timely manner all reports and
other documents and  information  required of the Purchaser under the Securities
Exchange  Act of 1934,  as amended,  and is eligible to register  the  Purchaser
Common  Shares on Form S-3. All filings  made by Purchaser  with the SEC and all
press releases  issued by the Purchaser  were true,  correct and complete in all
material respects when filed or released, and, except as disclosed in subsequent
filings with the SEC, since the date of each such filing or press release, there
has been no material adverse change in any of the information contained therein.

         4.10  Financial   Statements.   Each  of  the  consolidated   financial
statements (including,  in each case, any notes and schedules thereto) contained
in the Purchaser's SEC filing complies as to form with the applicable accounting
requirements and rules and regulations of the SEC and was prepared in accordance
with GAAP (except as may be indicated in the notes thereto),  and each presented
the  consolidated  financial  position,  results of operations and cash flows of
Purchaser and the  consolidated  subsidiaries  of Purchaser as at the respective
dates  thereof  and for the  respective  periods  indicated  therein,  except as
otherwise noted therein (subject, in the case of unaudited statements, to normal
and recurring year end adjustments which were not, and are not expected to have,
a material adverse effect on the business, operations, results of operations, or
the condition (financial or otherwise) of Purchaser and its subsidiaries,  taken
as a whole.)

         4.11 Organizational Documents.  Purchaser has heretofore made available
to the  Sellers  complete  and  correct  copies  of  its  Amended  and  Restated
Certificate  of  Formation  and  Operating   Agreement,   Bylaws  or  equivalent
organization  documents,  each as  amended  as of the  date  hereof.  Each  such
organizational  document  is in  full  force  and  effect.  Purchaser  is not in
violation  in any  material  respect  of any  provision  of its  Certificate  of
Formation and Operating  Agreement,  Bylaws, or other equivalent  organizational
documents.

         4.12 SEC Filings.  Purchaser  has  heretofore  made  available to the
Sellers  complete and correct copies of (i) all agreements,  documents and other
instruments  not yet filed by Purchaser  with the SEC but that are  currently in
effect  and that  Purchaser  expects to file with the SEC after the date of this
Agreement, and (ii) all amendments and modifications that have not been filed by
Purchaser with the SEC to all agreements,  documents and other  instruments that
previously had been filed with the SEC and are currently in effect.

         4.13 Tax  Matters.  Purchaser  is and always has been  classified  as a
partnership for Federal income tax purposes.  Accordingly,  Purchaser is not and
never has been liable for Federal income tax.  Purchaser has timely filed (after
giving effect to any applicable extensions) all Tax Returns required to be filed
by  Purchaser  under  applicable  law in a manner  which is true,  complete  and
correct in all material  respects and has,  within the time  prescribed  by law,
paid all other Taxes (i.e., all Taxes other than Federal income tax) shown to be
due and payable on such Tax Returns. Historically,  Purchaser has made quarterly
distributions to the holders of its common shares in an aggregate amount no less
than the taxable  income of  Purchaser  allocable  to such holders for any given
year  multiplied  by the  highest  rate of  Federal  income  tax  applicable  to
individuals  for such prior year,  and Purchaser has no current  intent to alter
its historical distribution  practices.  Purchaser makes no assurance whatsoever
as to its future tax status or distribution practices.

         4.14  Knowledge.  Purchaser  does not have any actual  knowledge of any
facts or circumstances that would make any of the  representations or warranties
of Sellers in this Agreement untrue or misleading.

         4.15     Purchaser's Expertise and Investigation.

                  (a)   Purchaser is an informed and sophisticated purchaser,
possesses such  knowledge and experience in financial and business  matters that
it is capable of evaluating  the merits and risks of its  investment  under this
Agreement  and has engaged  expert  legal,  financial,  tax,  business and other
advisors,  experienced  in the  evaluation and purchase of companies such as the
Company.

                  (b)   Purchaser  has undertaken  such  investigation  as it
deems  necessary or appropriate to enable it to make an informed and intelligent
decision with regard to this Agreement and the transactions contemplated by this
Agreement.

                  (c)   Purchaser  acknowledges  and agrees  that,  in entering
this  Agreement  and  acquiring  the Company and in consummating the other
transactions contemplated by this Agreement:

                           (i)  Purchaser  has relied and will rely  solely upon
         its own investigation and analysis,  the representations and warranties
         contained in Article III of this  Agreement,  and the  genuineness  and
         completeness of all records of the Company and its  Subsidiaries  which
         have been furnished to Purchaser for its review (and,  without limiting
         the  generality of the  foregoing,  not on any  information  learned or
         provided in connection  with any  presentation  made by Sellers,  their
         investment bankers or other non-employee representatives of the Company
         or the Subsidiaries.)

                           (ii)  Neither  the  Sellers,   the  Company  nor  the
         Subsidiaries  (nor  their  investment  bankers  or any of  their  other
         representatives)  has made any  representation  or  warranty  except as
         expressly set forth in Article III of this Agreement.

                           (iii)  None  of  the  Sellers,  the  Company  or  the
         Subsidiaries  (nor  their  investment  bankers  or any of  their  other
         representatives)  will have any  liability to Purchaser  (or any of its
         other  Representatives)  on any basis based upon any  information  made
         available or statements  made except for those  expressly  contained in
         Article  III of  this  Agreement  and  only  in  accordance  with  this
         Agreement.

                           (iv) On or prior to the date of this Agreement and on
         or prior to the Closing Date,  Purchaser and its  Representatives  have
         had full access to, and have been  furnished with all  information  and
         documentation  regarding,  the  Company  and  the  Subsidiaries,  their
         respective businesses,  their respective prospects, the Midland Shares,
         this Agreement and the  transactions  contemplated  by this  Agreement,
         including all of the facilities,  assets,  properties,  books,  leases,
         agreements,  commitments,  Contracts,  records  and  personnel  of  the
         Company and the Subsidiaries, including all information which Purchaser
         considers  necessary  or  advisable  to  enable  it to make a  decision
         concerning its purchase of the Midland Shares and all other information
         as  Purchaser  has  requested,   so  that  Purchaser  has  had  a  full
         opportunity  to review the business,  financial,  accounting  and legal
         matters relating to all of the foregoing.

         4.16 MESC Notice.  At least two business days prior to the date of this
Agreement,  Purchaser  has received a true and  complete  copy of MESC Form 1027
entitled  "Business   Transferors  Notice  to  Transferee  of  Unemployment  Tax
Liability and Rate" in accordance with the provisions of applicable law.

                                    ARTICLE V
                              COVENANTS OF SELLERS

         Sellers, jointly and severally, covenant and agree with Purchaser that,
at all times from and after the date hereof, for the period specified herein or,
if no period is  specified  herein,  indefinitely,  Sellers will comply with all
covenants and  provisions of this Article V, except to the extent  Purchaser may
otherwise give its prior consent in writing.

         5.01. Regulatory and Other Approvals.  Sellers will, and will cause the
Company and the  Subsidiaries to, (a) use commercially  reasonable  efforts,  as
promptly as practicable to obtain all consents, approvals or actions of, to make
all  filings  with  and to  give  all  notices  to  Governmental  or  Regulatory
Authorities  or any  other  Person  required  of  Sellers,  the  Company  or any
Subsidiary  to  consummate  the  transactions  contemplated  hereby,  including,
without limitation,  those described in Schedules 3.06 or 3.07, (b) provide such
other  information  and   communications  to  such  Governmental  or  Regulatory
Authorities  or other  Persons as Purchaser or such  Governmental  or Regulatory
Authorities  or other  Persons may  reasonably  request and (c)  cooperate  with
Purchaser as promptly as  practicable  in obtaining all  consents,  approvals or
actions of,  making all filings with and giving all notices to  Governmental  or
Regulatory  Authorities or other Persons required of Purchaser to consummate the
transactions  contemplated  hereby.  Sellers will provide prompt notification to
Purchaser when any such consent,  approval, action, filing or notice referred to
in clause (a) above is obtained,  taken, made or given, as applicable,  and will
advise Purchaser of any  communications  (and,  unless precluded by Law, provide
copies of any such  communications that are in writing) with any Governmental or
Regulatory   Authority  or  other  Person  regarding  any  of  the  transactions
contemplated by this Agreement or any of the Operative Agreements.

         5.02.  Books and  Records.  At Closing,  Sellers  will  deliver or make
available to Purchaser at the offices of the Company and the Subsidiaries all of
the Books and Records,  and if at any time after the Closing Sellers discover in
their  possession or under their control any other Books and Records,  they will
forthwith deliver such Books and Records to Purchaser.

         5.03.  Notice and Cure.  Sellers  will  notify  Purchaser  promptly  in
writing of, and contemporaneously  will provide Purchaser with true and complete
copies  of any and all  information  or  documents  relating  to,  and  will use
commercially reasonable efforts to cure, any event,  transaction or circumstance
occurring  after  the date of this  Agreement  that  causes  or will  cause  any
covenant or  agreement  of Sellers  under this  Agreement to be breached or that
renders  or will  render  untrue  any  representation  or  warranty  of  Sellers
contained  in this  Agreement  as if the same  were made on or as of the date of
such event, transaction or circumstance.

         5.04. Continued Access. Between the date of this Agreement and the date
of Closing,  Sellers will afford Purchaser and its advisors reasonable access to
the personnel, properties, Contracts, Books and Records, and other documents and
data of the Company and its  Subsidiaries.  ...Any such access will be provided,
and all such  inspections  will be conducted,  at reasonable times and in such a
manner  as  not  to  interfere  with  the  operations  of  the  Company  or  the
Subsidiaries.

         5.05.  Operation of the Business Prior to Closing.  Between the date of
this Agreement and the date of Closing, Sellers will, and will cause the Company
and  each  Subsidiary  to (a)  conduct  the  business  of the  Company  and each
Subsidiary in the ordinary  course of business,  (b) use  reasonable  efforts to
preserve  intact  the  current  business  organization  of the  Company  and its
Subsidiaries,  keep available the services of the current officers and employees
of the Company and its Subsidiaries,  and maintain the contractual relations and
good will of the Company and its Subsidiaries with MAHGT, Fannie Mae, GNMA, HUD,
FHLA, tax credit investors,  borrowers,  landlords,  creditors and others having
business  relationships  with  the  Company  and its  Subsidiaries,  and (c) not
undertake any matters outside the ordinary course of business  without the prior
written consent of Purchaser which consent shall not be unreasonably withheld or
delayed  and if not  withheld  or given  within  seven  days of  notice  of such
undertaking  shall be  deemed  given.  An  action  shall be  deemed to be in the
ordinary course of business only if it is consistent with past practice.

         5.06.  Disclosure;  Shopping.  Sellers shall not make any disclosure of
the  existence  or  terms  of this  Agreement  without  the  prior  approval  of
Purchaser. Sellers will not, and shall cause the Company and each Subsidiary not
to,  directly or  indirectly  solicit,  initiate,  or encourage any inquiries or
proposals  from,  or discuss or  negotiate  with,  any  Person  relating  to any
transaction  involving  the sale of the business or Assets or  Properties of the
Company or any Subsidiary or the capital stock of the Company or any Subsidiary.

         5.07     Tax Credit Entities; Ownership and Control.

                  (a)   Sellers agree that they will take no steps to remove,
and will vote their  ownership  interests  (in  whatever  form) to  prevent  the
removal of, Midland Equity  Corporation (or any other Subsidiary of the Company)
as general  partner  (or as general  partner  of a general  partner)  of any Tax
Credit Partnership or of any Operating Partnership in which it serves as general
partner,  unless Midland  Equity  Corporation  (or such other  Subsidiary of the
Company)  defaults in its obligations under the relevant  partnership  agreement
and none of the  Sellers  is on the Board of  Directors  of, or is an officer or
employee of, such defaulting entity.

                  (b)   The provisions of this Section 5.07 shall survive
Closing for as long as any Seller is an employee,  officer or director of
Purchaser or any of its Subsidiaries.

         5.08     Updating of Schedules.

                  (a)   Between  the date of this  Agreement and the Business
Day  immediately  preceding  the Closing  Date,  Sellers  will from time to time
deliver to Purchaser  updated  Disclosure  Schedules  showing any changed facts,
circumstances  or  information  from the  matters  disclosed  in the  Disclosure
Schedules to this Agreement necessary to make the representations and warranties
set forth in Article III above true and  complete  (irrespective  of whether any
particular section of this Agreement calls for a Schedule to such section) which
shall be deemed an amendment to this Agreement.

                  (b)   If  the  information   contained  in  any  Disclosure
Schedules or updates  thereto  delivered  between the date of this Agreement and
the Closing Date, or if the underlying  documents  referenced therein or related
thereto, could, in Purchaser's sole discretion,  have a Material Adverse Effect,
Purchaser shall have the option,  as its sole and exclusive remedy, to terminate
this Agreement by written notice to Sellers  delivered  within five (5) Business
Days of Purchaser's  receipt of such information,  and no party shall thereafter
have any liability to any other party.

         5.09     Affiliate Transactions.

                  (a)   Beginning  on the  date  of this  Agreement,  Sellers
shall advise Purchaser of all material  transactions  between Sellers on the one
hand, and the Company,  the Purchaser or any of their  Subsidiaries on the other
hand. In addition,  during the term of their respective  employment  agreements,
each Seller shall give  Purchaser at least five (5) Business  Days notice of any
proposed  transactions  involving the  acquisition or disposition of Purchaser's
Common  Shares  and shall  conduct  all  transactions  so as to comply  with all
applicable securities laws.

                  (b)   No  later than December 31, 1999,  Sellers will cause
the Company and its Subsidiaries,  on the one hand, and Sellers and their family
members,  family trusts and related persons,  on the other hand to repay in full
all debt owed by either group to the other.

         5.10  Closing  Share  Restrictions.  Banks  and  Gloeckl  shall  retain
ownership of their Purchaser Closing Shares for a period of three years from the
Closing Date. For one year  thereafter,  Messrs.  Banks and Gloeckl shall retain
ownership of Purchaser  Closing Shares having a value of at least $3 million and
$1 million respectively.  Mathis shall retain ownership of his Purchaser Closing
Shares  for a period of one  year.  Each  Seller  may,  at any  time,  pledge or
encumber his Purchaser Closing Shares to secure personal borrowings.

                                   ARTICLE VI
                             COVENANTS OF PURCHASER

         Purchaser covenants and agrees with Sellers that, at all times from and
after the date hereof,  Purchaser  will comply with all covenants and provisions
of this  Article  VI,  except to the extent  Sellers  may  otherwise  consent in
writing.

         6.01.  Regulatory  and  Other  Approvals.  Purchaser  will (a) take all
commercially reasonable steps necessary or desirable, and proceed diligently and
in good  faith and use all  commercially  reasonable  efforts,  as  promptly  as
practicable to obtain all consents, approvals or actions of, to make all filings
with and to give all notices to  Governmental  or Regulatory  Authorities or any
other Person required of Purchaser to consummate the  transactions  contemplated
hereby, including,  without limitation, those described in Schedule 4.05 hereto,
(b) provide such other  information and  communications  to such Governmental or
Regulatory  Authorities  or other  Persons as Sellers  or such  Governmental  or
Regulatory Authorities or other Persons may reasonably request and (c) cooperate
with Sellers,  the Company and the  Subsidiaries  as promptly as  practicable in
obtaining  all  consents,  approvals or actions of,  making all filings with and
giving all notices to  Governmental  or Regulatory  Authorities or other Persons
required  of  Sellers,   the  Company  or  any   Subsidiary  to  consummate  the
transactions contemplated hereby and by the Operative Agreements. Purchaser will
provide prompt notification to Sellers when any such consent,  approval, action,
filing or notice  referred to in clause (a) above is  obtained,  taken,  made or
given, as applicable, and will advise Sellers of any communications (and, unless
precluded by Law, provide copies of any such communications that are in writing)
with any  Governmental or Regulatory  Authority or other Person regarding any of
the transactions contemplated by this Agreement.

         6.02.  Notice and Cure.  Purchaser  will  notify  Sellers  promptly  in
writing of, and  contemporaneously  will  provide  Seller with true and complete
copies of any and all  information  or  documents  relating to, and will use all
commercially reasonable efforts to cure, any event,  transaction or circumstance
occurring  after  the date of this  Agreement  that  causes  or will  cause  any
covenant or agreement of Purchaser  under this  Agreement to be breached or that
renders or will  render  untrue any  representation  or  warranty  of  Purchaser
contained  in this  Agreement  as if the same  were made on or as of the date of
such  event,  transaction  or  circumstance.  No notice  given  pursuant to this
Section shall have any effect on the representations,  warranties,  covenants or
agreements contained in this Agreement for purposes of determining  satisfaction
of any condition  contained  herein or shall in any way limit  Sellers' right to
seek indemnity under Article X.

         6.03  Limitation  of  Sellers'  Liabilities.  Purchaser  will  take all
necessary  actions to insure that Sellers  have no  obligations  or  liabilities
whatsoever  relating  to the  Company or the  Subsidiaries  or their  respective
businesses,  properties  or  assets,  as the same  may  exist on or prior to the
Closing  Date or arise  thereafter  (other  than  liabilities  arising  under or
expressly  preserved  under this  Agreement  and  liabilities  arising  from the
Sellers' own tortuous  conduct).  Purchaser will  cooperate  with Sellers,  both
before and after the  Closing,  by taking,  and after the  Closing  causing  the
Company and the Subsidiaries to take, all actions Sellers  reasonably request to
effectuate the termination of any such obligation or liability  asserted against
or imposed on Sellers, including Purchaser's using its best efforts to provide a
substitute  guaranty  or other  arrangement  to  release  Sellers  from any such
liability or obligation.

         6.04 Employees.  Purchaser will cause the Company and the  Subsidiaries
to continue to employ, for a period of at least one year after the Closing Date,
those employees of the Company and the  Subsidiaries  listed on Schedule 6.04 on
terms and conditions,  including  compensation and benefits, at least comparable
to those in effect at or  immediately  prior to the Closing;  provided  that the
foregoing will not preclude the Company or the Subsidiaries from terminating any
of such employees for cause during such period.  Purchaser will use commercially
reasonable  efforts  to  retain  all  other  employees  of the  Company  and its
Subsidiaries  for a period of one year on  comparable  terms and  conditions  to
those in effect prior to the Closing Date,  but all such  employees  will remain
"at will" employees.

         6.05  Post-Closing  Operations  of the  Company  and the  Subsidiaries.
Following the Closing and until September 30, 2002, Purchaser shall not take any
action  the sole  purpose  of which is to  reduce  the  income or  increase  the
expenses of the Company and its  Subsidiaries (on a consolidated  basis),  other
than such  decreases in income and  increases in expenses as can be adjusted for
in calculating Net Income under Section 2.04,  without the prior written consent
of the  Sellers.  Nothing  in this  Agreement  shall be deemed or  construed  to
preclude  Purchaser from operating the Company and its  Subsidiaries in a manner
consistent  with  Purchaser's  overall  business plan and in compliance with all
applicable  Laws,  Contracts and  standards  imposed by third  parties,  such as
FannieMae.
         6.06 704(c) Gain..  Purchaser has not adopted,  and will not adopt, any
method for  reconciling  the  difference  between the value and tax basis of the
Midland  Shares  under  Section  704(c) of the Code which  would  result in such
difference   being   reconciled,   or  Sellers   otherwise   being  allocated  a
disproportionate  amount of  Purchaser's  income or gain,  prior to  Purchaser's
disposition of the Midland Shares.

                                   article vii
                       TAX MATTERS AND POST-CLOSING TAXES

         7.01.  Pre-Closing  Tax Returns.  Sellers  shall prepare or cause to be
prepared,  and file or cause to be filed all Tax Returns or claims for refund of
the  Company for all  taxable  periods of the Company  ending on or prior to the
Closing Date  ("Pre-Closing Tax Returns").  With respect to any such Pre-Closing
Tax Returns  required  to be filed by Sellers  and not filed  before the Closing
Date,  Sellers shall provide Purchaser and its authorized  representatives  with
copies of any such  completed  Tax Return at least 15 Business Days prior to the
due date for  filing of such Tax Return and  Purchaser  and its  representatives
shall  have the right to review  (but not to  require  any  change  to) such Tax
Return  prior to the  filing of such Tax  Return,  which  each  Seller is hereby
irrevocably  authorized to sign on behalf of the Company. All Taxes with respect
to such Tax Returns  ("Pre-Closing Taxes") which exceed the accruals therefor as
shown on the Closing  Audit  shall be paid as follows.  All such Taxes which are
federal  income  taxes shall be paid by  Sellers;  all other such Taxes shall be
paid by  Purchaser or the Company and shall  constitute a Loss to Purchaser  for
purposes of Section 10.02. Purchaser shall not amend any Pre-Closing Tax Returns
without  the  Sellers'  consent.  Sellers  shall not  amend any such Tax  Return
without  the  written   approval  of  Purchaser,   which  approval  may  not  be
unreasonably withheld.

         7.02.  Transfer  Taxes.  Purchaser shall pay one-half and Sellers shall
pay  one-half  of any and all sales,  use,  transfer,  real  property  transfer,
recording,  gains,  stamp  stock  transfer  and  other  similar  taxes  and fees
("Transfer  Taxes")  arising  out  of or in  connection  with  the  transactions
effected pursuant to this Agreement, and each shall indemnify,  defend, and hold
harmless  the other with  respect to its  proportionate  share of such  Transfer
Taxes.  The party  required by law to file all necessary  documentation  and Tax
Returns with respect to such Transfer Taxes shall do so.

         7.03.    Post-Closing Taxes and Sellers' Post-Closing Taxes.

                  (a)   Purchaser  shall timely prepare and file (or cause to
be prepared  and filed) all Tax Returns  required by law for all Taxes  covering
the Company  for periods  ending  after the date of Closing,  including  periods
which  include  a  period  prior  to the  date  of  Closing  ("Post-Closing  Tax
Returns").  Purchaser  will  determine  in good  faith  the  basis on which  all
Post-Closing Tax Returns are to be filed. Purchaser shall timely pay or cause to
be paid all Taxes relating to Post-Closing Tax Returns ("Post-Closing Taxes").

                  (b)   For  purposes  of  determining  the  adequacy  of the
accruals for Taxes on the Company's balance sheets as of the date of the Closing
Audit (prepared in accordance  with GAAP),  the amount of any Taxes for a period
beginning  before and ending after the date of the Closing  Audit which shall be
deemed to have  accrued on or before the date of the  Closing  Audit  ("Sellers'
Post-Closing Taxes") shall be:

                     (i) in the case of any real or personal property Tax,
an amount equal to the Tax for the Assets and Properties owned by the Company or
any  Subsidiary on the date of the Closing Audit for the entire  taxable  period
multiplied  by a fraction  the  numerator  of which is the number of days in the
entire  taxable  period  ending  on  the  date  of the  Closing  Audit  and  the
denominator of which is the number of days in the entire taxable period;

                     (ii)     in the case of any other Tax, the amount that
would be payable by the Company or any  Subsidiary if its taxable year ended on
the date of the Closing Audit.

At least 30 days  prior to the  filing  of any  Post-Closing  Tax  Return  which
includes any Sellers' Post-Closing Taxes, Purchaser shall provide Sellers with a
copy of the return along with Purchaser's  calculation of Sellers'  Post-Closing
Taxes related thereto and shall, at the request of Sellers, during the following
30 days consult with Sellers concerning such Post-Closing Tax Return.

                  (c)   Upon  the  filing of the  Post-Closing  Tax  Returns,
Sellers  shall  pay  to  Purchaser  any of  Seller's  Post-Closing  Taxes  which
constitute  federal  income  taxes to the extent such Taxes  exceed the accruals
therefor as shown on the Closing  Audit;  all of Seller's  Post-  Closing  Taxes
which are not federal income taxes shall be paid by Purchaser or the Company and
shall constitute a Loss to Purchaser for purposes of Section 10.02.

         7.04.  Notification of Audits.  Purchaser shall promptly notify Sellers
in writing upon receipt by Purchaser of notice of (i) any pending or  threatened
federal,  state,  local or foreign Tax audits or assessments of the Company,  so
long as any period  relating to  Pre-Closing  Taxes remains  open,  and (ii) any
pending or threatened federal, state, local or foreign Tax audits or assessments
of the Purchaser  which may affect the Tax  liabilities of the Company,  in each
case for periods relating to Pre-Closing Taxes only.

         7.05. Maintenance of Records. After the date of Closing,  Purchaser and
Sellers  shall  make  available  to the  other,  as  reasonably  requested,  all
information,  records or documents  relating to Tax liabilities or potential Tax
liabilities  of  Sellers,  any  Affiliate  of  Sellers  or  the  Company  or any
Subsidiary for any period commencing before the Closing Date and for the portion
of any period  allocated to Sellers under Section 7.03,  and shall  preserve all
such  information,  records and documents until the expiration of any applicable
statute of limitations,  including  extensions  thereof, or such other period as
required by Law.  Purchaser and Sellers shall also make  available to each other
as reasonably  requested by Purchaser or Sellers,  as the case may be, personnel
responsible for preparing or maintaining information,  records and documents, in
connection  with Tax  matters.  In case at any time after the  Closing  Date any
further  action is necessary to carry out the  purposes of this  Agreement,  the
parties hereto shall take all such necessary action.

         7.06.  Purchase  Price  Adjustment  Any payments  made to Sellers,  the
Company or Purchaser pursuant to this Article VII shall constitute an adjustment
of the Purchase Price for Tax purposes and shall be treated as such by Purchaser
and Sellers on their Tax Returns to the extent permitted by law.

         7.07. Tax Sharing Agreements. All Tax sharing or similar agreements, if
any, to which the Company or its Subsidiaries is a party will be cancelled at or
prior to the Closing and neither the Company,  its  Subsidiaries  nor  Purchaser
shall not be bound thereby or have any obligation thereunder.

                                  ARTICLE VIII
                              CONDITIONS TO CLOSING

         8.01 Conditions to Purchaser's  Performance.  Purchaser's obligation to
proceed to Closing shall be conditioned  upon the satisfaction (or the waiver in
writing by Purchaser) of each of the following:

                  (a)   Michael L. Falcone shall have been elected as a trustee
of the Trust effective as of the Closing.

                  (b)   Sellers shall have obtained and delivered to Purchaser
written  consent to the Transaction of FannieMae and the Trust and each other
Person listed on Schedule 8.01.

                  (c)   Each of Sellers'  representations  and warranties set
forth in Article  III shall be true and  correct in all  material  respects  and
Sellers shall so certify in writing at Closing.

                  (d)   Sellers shall be in a position to deliver to Purchaser
certificates  evidencing the Midland Shares and good and valid title to the
Shares, free and clear of all Liens.

                  (e)   Sellers shall have performed in all material respects
all obligations and agreements and complied with all covenants in this Agreement
or in any  Operative  Agreement  to be  performed  and  complied  with by any of
Sellers at or before Closing and Sellers shall so certify in writing at Closing.

                  (f)   Each  of Sellers shall have executed and delivered to
Purchaser that employment agreement in the form attached hereto as Exhibit B and
intended to be executed by him (collectively,  the "Employment Agreements"). The
Employment  Agreements  shall provide  collectively  for an annual salary before
incentive  compensation  of  $650,000 to be divided  among the Sellers  (and any
replacement  for Ray Mathis  after his  contract  expires)  as the  Sellers  may
decide.

                  (g)   Purchaser  shall have received  certificates  of good
standing for the Company and each of its Subsidiaries for the States of Florida,
Michigan,  California  and Texas and each other state  listed on Schedule  3.03,
each such certificate of good standing to be dated as of a date not more than 30
days prior to the Closing Date.

                  (h)   Purchaser shall have received an estoppel  certificate
from the lessor under the real property lease for the Company's Florida offices.

                  (i)   There  shall not have  occurred any material  adverse
change in the Business or Condition of the Company since the Unaudited Financial
Statement  Date,  and with respect to the Assets and  Properties  of the Company
there have been no payment  defaults and no occurrence which if not waived would
result in a payment default.

                  (j)   All  notice  periods  shall have elapsed or otherwise
been terminated under the HSR Act.

                  (k)   There  shall not have been  commenced  or  threatened
against  Sellers,  Purchaser or any Affiliate of either any Action of Proceeding
(i) involving any challenge to, or seeking damages or other relief in connection
with  any of the  transactions  contemplated  hereby  or (ii)  that may have the
effect of preventing,  delaying,  making illegal, or otherwise  interfering with
any of such transactions.

                  (l)   There  shall not have been made or  threatened by any
Person any claim  asserting  that such  Person  (i) is a holder or a  beneficial
owner of, or has any Option  with  respect  to,  any of the stock,  or any other
voting,  equity or ownership  interest in, the Company or any Subsidiary or (ii)
is entitled to all or any portion of the Purchase Price.

                  (m)   Sellers  shall have provided  Purchaser with evidence
of the  termination  of  that  certain  agreement  known  as  Midland  Financial
Holdings, Inc. Optional-Purchase Stock Agreement dated January 2, 1991 among the
Company and the Sellers.

         8.02 Conditions to Sellers' Performance. Sellers' obligation to proceed
to Closing shall be conditioned  upon the satisfaction (or the waiver in writing
by Sellers) of each of the following:

                  (a)   Purchaser   shall  have  obtained  and  delivered  to
Sellers the written  consent to the  Transaction of each of the  following:  (i)
each Person whose consent to the Transaction is required by any Contract,  Order
or Law by which  Purchaser is bound or to which it is subject and (ii) the Board
of Directors of Purchaser.

                  (b)   Each  of Purchaser's  representations  and warranties
set forth in  Article  IV of this  Agreement  shall be true and  correct  in all
material respects and Purchaser shall so certify at Closing.

                  (c)   Purchaser   shall  have  performed  in  all  material
respects all  obligations and agreements and complied with all covenants in this
Agreement or in any  Operative  Agreement to be performed  and complied  with by
Purchaser  at or before  Closing  and  Purchaser  shall so certify in writing at
Closing.

                  (d)   Purchaser shall have executed and delivered to Sellers
the Employment Agreements.

                  (e)   Purchaser shall have executed and delivered to Sellers
the Registration  Rights Agreement (the "Registration Rights Agreement")
attached hereto as Exhibit C.

                  (f)   All  notice  periods  shall have elapsed or otherwise
been terminated under the HSR Act.

                  (g)   There  shall not have been  commenced  or  threatened
against  Sellers or any  Affiliate  of  Sellers  any  Action or  Proceeding  (i)
involving  any  challenge  to, or seeking  damages or other relief in connection
with,  any of the  transactions  contemplated  hereby  or (ii) that may have the
effect of preventing,  delaying,  making illegal, or otherwise  interfering with
any of such transactions.

                  (h)   There shall not have occurred any adverse  change in the
Business or Condition of the  Purchaser  since June 30, 1999 which would require
a filing by Purchaser with the SEC.

                  (i)   Robert Banks shall have been elected to a three-year
term as a director of  Purchaser, effective as of the Closing Date.

                                   ARTICLE IX
                    SURVIVAL OF REPRESENTATIONS, WARRANTIES,
                            COVENANTS AND AGREEMENTS

         9.01 Survival of Representations, Warranties, Covenants and Agreements.
Notwithstanding any right of Purchaser (whether or not exercised) to investigate
the  affairs  of the  Company  and the  Subsidiaries  or any  right of any party
(whether or not  exercised) to investigate  the accuracy of the  representations
and  warranties  of the other party  contained  in this  Agreement,  Sellers and
Purchaser  have the right to rely  fully upon the  representations,  warranties,
covenants  and  agreements  of  the  other  contained  in  this  Agreement.  The
representations,  warranties,  covenants and agreements of Sellers and Purchaser
contained  in this  Agreement  will  survive the Closing (a)  indefinitely  with
respect to the representations and warranties  contained in Sections 3.02, 3.04,
3.05 (but only insofar as it relates to the capital stock of the  Subsidiaries),
3.30,  4.02,  4.03,  4.07,  4.08 and 10.01(c),  and the  indemnity  contained in
Section  10.01(b),  (b) until six years after the Closing  Date with  respect to
matters covered by Sections 3.10, 4.01, 4.13, 6.06,  10.01(a) and 10.02(d),  (c)
until one year after the date of  Closing  in the case of  Section  3.13 and all
other  representations  and  warranties  and any  covenant  or  agreement  to be
performed  in whole or in part on or prior to the Closing or (d) with respect to
each other  covenant or  agreement  contained  in this  Agreement,  for a period
comparable  to that used in clause  (c)  following  the last date on which  such
covenant  or  agreement  is to be  performed  or, if no such date is  specified,
indefinitely,  except that any representation,  warranty,  covenant or agreement
that would  otherwise  terminate in accordance with clause (b), (c) or (d) above
will continue to survive if a Claim Notice or Indemnity  Notice (as  applicable)
shall have been  timely  given under  Article X on or prior to such  termination
date,  until  the  related  claim  for  indemnification  has been  satisfied  or
otherwise resolved as provided in Article X.

         9.02 Certain Purchase Rights. In the event of a Business Combination as
defined in Section  12.1 of  Purchaser's  Amended and  Restated  Certificate  of
Formation and Operating Agreement which does not meet the voting requirements of
either  Section 12.2 or Section  12.3(b)(i)  of such  Operating  Agreement,  the
members of the Board of  Directors of the Company,  as  constituted  immediately
prior to the effective date of such Business  Combination,  shall have the right
to acquire the Company and its Subsidiaries from Purchaser for the fair value of
the Company and its  Subsidiaries.  Fair value shall be  determined by Robert A.
Stanger & Co.,  Inc.,  or if it shall no longer be in the business of performing
such  valuations for real estate lending  companies,  then by a firm which is an
expert in such valuations and which is mutually  agreeable to Purchaser and such
Board  members.  The Board members shall notify  Purchaser in writing within ten
(10) Business  Days after the Board  members have notice of the Control  Company
Interests  Acquisition or Business  Combination that they wish to exercise their
rights  hereunder.  Within ten (10)  Business  Days after  their  receipt of the
determination of fair value,  the Board members shall notify  Purchaser  whether
they  wish to  proceed.  If  they  elect  to  proceed,  the  purchase  shall  be
consummated within one hundred twenty (120) days of such election, at which time
the purchase price shall be paid in cash and Purchaser  shall deliver such bills
of sale, stock  certificates and other  instruments of title as may be necessary
to convey  complete  ownership  of the  Company and its  Subsidiaries  and their
respective assets and properties to the Board members or their designees. During
the period between valuation and closing, Purchaser shall take no action outside
the ordinary  course of business  which could have a Material  Adverse Effect on
the value of the Company and its  Subsidiaries.  This Section 9.02 shall survive
the Closing for a period of twenty (20) years.

                           ARTICLE X - INDEMNIFICATION

         10.01.   Tax Indemnifications.

                  (a)   Sellers  will  indemnify  and hold  harmless  Purchaser
and the  Company  from and against  liability for Pre-Closing Taxes and Sellers'
Post-Closing Taxes in accordance with Sections 7.01 and 7.03(c).

                  (b)   Purchaser  agrees to promptly indemnify and reimburse
Sellers for all federal  income taxes which they are required to pay as a result
of a determination  by IRS that the delivery of the Purchaser  Closing Shares or
the Earn-out Shares is a recognition  event for federal income tax purposes,  or
if any payment of Earn-out  Shares is made in cash under  Section  2.04(e).  The
amount  of the  indemnity  shall be the  amount of tax  which  the  Sellers  are
required to pay to the IRS as a  consequence  of the  foregoing,  plus an amount
sufficient to pay any  additional tax the Sellers are required to pay on account
of such  payment,  plus any interest and  penalties  the Sellers are required to
pay. If, in lieu of Earn-Out Shares,  Purchaser at any time pays cash to Sellers
pursuant to Section 2.04(e) of this Agreement,  then Purchaser shall also pay in
cash,  at the same time,  an amount equal to the amount of tax which the Sellers
are required to pay to the IRS as a consequence of the foregoing, plus an amount
sufficient to pay any  additional tax the Sellers are required to pay on account
of such  payment,  plus any interest and  penalties  the Sellers are required to
pay.

                  (c)   Unless  and  until the IRS shall  notify  Sellers  in
writing to the contrary,  Sellers shall treat delivery of the Purchaser  Closing
Shares and the Earn-out  Shares as  non-recognition  events under Section 721 of
the Code neither  Sellers nor Purchaser  and shall take any action  inconsistent
with such treatment.

         10.02.   Other Indemnification.

                  (a)   Sellers  shall,  jointly  and  severally,   indemnify
Purchaser  and its  officers,  directors,  employees,  agents and  Affiliates in
respect of, and hold each of them harmless from and against,  any and all Losses
suffered,  incurred or  sustained by any of them or to which any of them becomes
subject,  resulting from,  arising out of or relating to any  misrepresentation,
breach of warranty or  nonfulfillment  of or failure to perform any  covenant or
agreement on the part of Sellers contained in this Agreement.

                  (b)   Purchaser  agrees to indemnify  Sellers and hold each
of them  harmless  from and against,  any and all Losses  suffered,  incurred or
sustained  by any of them or to which  any of them  becomes  subject,  resulting
from, arising out of or relating to any misrepresentation, breach of warranty or
nonfulfillment of or failure to perform any covenant or agreement on the part of
Purchaser contained in this Agreement.

                  (c)   No  amounts shall be payable as a result of any claim
arising under  Sections  10.01(a) or 10.02(a)  unless and until the  Indemnified
Parties  thereunder  have  suffered,  incurred,  sustained or become  subject to
Losses referred to in such Section in excess of $1,000,000 in the aggregate,  in
which event the  Indemnified  Parties  shall only be entitled to seek  indemnity
from  Sellers for the amount of losses in excess of  $1,000,000,  provided  that
this paragraph (c) shall not limit Purchaser's right to indemnity resulting from
a misrepresentation or breach of warranty by Sellers contained in Sections 3.02,
3.04 and 3.24.

         Notwithstanding  anything to the contrary  contained in this Agreement,
in no event shall Sellers'  aggregate  liability under this Agreement exceed $10
million.

                  (d)   Sellers  shall  indemnify  and  hold  Purchaser,  the
Company and its Subsidiaries  harmless from any and all Loss on any construction
loans made by the Company or its Subsidiaries on those certain projects known as
Manhattan Square and the Capstone transaction in Eugene,  Oregon. This indemnity
shall not be subject to the limitations of Section 10.02(c).

                  (e)   The remedies provided in Sections  10.01(a),  10.02(a)
and 10.02(d)  constitute the exclusive remedy against Sellers for any claim in
connection with this Agreement.

         10.03.  Method of Asserting Claims.  All claims for  indemnification by
any  Indemnified  Party under  Section  10.02 will be asserted  and  resolved as
follows:

                  (a)   In  the event any claim or demand in respect of which
an  Indemnifying  Party might seek  indemnity  under  Section  10.02 is asserted
against or sought to be collected from such Indemnified  Party by a Person other
than Sellers, the Company, any Subsidiary, Purchaser or any Affiliate of Sellers
or Purchaser (a "Third Party  Claim"),  the  Indemnified  Party shall  deliver a
Claim  Notice with  reasonable  promptness  to the  Indemnifying  Party.  If the
Indemnified  Party fails to provide the Claim Notice with reasonable  promptness
after the  Indemnified  Party  receives  notice of such Third Party  Claim,  the
Indemnifying Party will not be obligated to indemnify the Indemnified Party with
respect to such Third Party Claim to the extent  that the  Indemnifying  Party's
ability to defend has been prejudiced by such failure of the Indemnified Party.

                     (i) The  Indemnifying  Party will have the right upon
notice to the Indemnified  Party to defend,  at the sole cost and expense of the
Indemnifying Party, such Third Party Claim by all appropriate proceedings, which
proceedings will be prosecuted by the  Indemnifying  Party to a final conclusion
or will be settled at the  discretion of the  Indemnifying  Party (but only with
the consent of the Indemnified Party,  which shall not be unreasonably  withheld
or delayed,  in the case of any  settlement  that  provides for any relief other
than the  payment of monetary  damages.  The  Indemnifying  Party will have full
control of such defense and proceedings,  including any compromise or settlement
thereof; provided, however, that the Indemnified Party may, at the sole cost and
expense of the Indemnified Party, at any time prior to the Indemnifying  Party's
delivery  of the notice  referred  to in the first  sentence of this clause (i),
file any motion,  answer or other  pleadings  or take any other  action that the
Indemnified Party reasonably  believes to be necessary or appropriate to protect
its  interests;  and provided  further,  that if  requested by the  Indemnifying
Party,  the  Indemnified  Party  will,  at the  sole  cost  and  expense  of the
Indemnifying Party, provide reasonable  cooperation to the Indemnifying Party in
contesting any Third Party Claim that the Indemnifying  Party elects to contest.
The  Indemnified  Party may  participate  in, but not  control,  any  defense or
settlement  of any  Third  Party  Claim  controlled  by the  Indemnifying  Party
pursuant to this clause (i), and except as provided in the  preceding  sentence,
the Indemnified  Party will bear its own costs and expenses with respect to such
participation.  Notwithstanding  the foregoing,  the Indemnified  Party may take
over the control of the defense or settlement of a Third Party Claim at any time
if it irrevocably waives its right to indemnity under Section 10.02 with respect
to such Third  Party  Claim and agrees to  indemnify  and hold the  Indemnifying
Party harmless from any Losses results from such Third Party Claim.

                     (ii)  If the  Indemnifying  Party fails to  prosecute
reasonably  diligently the Third Party Claim,  then the  Indemnified  Party will
have the right to  defend,  at the sole  cost and  expense  of the  Indemnifying
Party, the Third Party Claim by all appropriate  proceedings,  which proceedings
will be prosecuted  by the  Indemnified  Party in a diligent  manner and in good
faith and may be settled at the  discretion of the  Indemnified  Party (with the
consent of the Indemnifying Party, which consent may be withheld or given at the
Indemnifying Party's  discretion).  The Indemnified Party will have full control
of such defense and proceedings, including any compromise or settlement thereof;
provided,  however, that if requested by the Indemnified Party, the Indemnifying
Party will,  at the sole cost and  expense of the  Indemnifying  Party,  provide
reasonable  cooperation to the  Indemnified  Party and its counsel in contesting
any  Third  Party  Claim  which  the  Indemnified   Party  is  contesting.   The
Indemnifying  Party  may  participate  in,  but  not  control,  any  defense  or
settlement controlled by the Indemnified Party pursuant to this clause (ii), and
the Indemnifying Party will bear its own costs and expenses with respect to such
participation.  If the Indemnifying Party disputes its liability with respect to
the Third  Party Claim  under  Section  10.02,  the  Indemnifying  Party and the
Indemnified  Party will proceed in good faith to negotiate a resolution  of such
dispute,  and if such claim is less than $1,000,000 and is not resolved  through
negotiations  within the  Resolution  Period,  such dispute shall be resolved by
arbitration in accordance with paragraph (d) of this Section 10.03.

                  (b)   In  the event any  Indemnified  Party  should  have a
claim under Section 10.02 against any Indemnifying Party that does not involve a
Third Party Claim, the Indemnified  Party shall deliver an Indemnity Notice with
reasonable  promptness to the Indemnifying Party. The failure by any Indemnified
Party  to give the  Indemnity  Notice  shall  not  impair  such  party's  rights
hereunder  except to the extent that an Indemnifying  Party has been irreparably
prejudiced  thereby.  If the  Indemnifying  Party  disputes its  liability  with
respect to such claim,  the  Indemnifying  Party and the Indemnified  Party will
proceed in good faith to negotiate a  resolution  of such  dispute,  and if such
claim is less than $1,000,000 and is not resolved  through  negotiations  within
the  Resolution  Period,  such  dispute  shall be  resolved  by  arbitration  in
accordance with paragraph (d) of this Section 10.03.

                  (c)   In the  event of any Loss in  excess  of  $100,000,
resulting  from a  misrepresentation,  breach of warranty or  nonfulfillment  or
failure to be performed of any covenant or agreement contained in this Agreement
as to which an  Indemnified  Party would be entitled  to claim  indemnity  under
Section 10.02 but for the provisions of paragraph (c) thereof,  such Indemnified
Party  may  nevertheless  deliver a written  notice  to the  Indemnifying  Party
containing  the  information  that  would be  required  in a Claim  Notice or an
Indemnity Notice, as applicable,  with respect to such Loss. If the Indemnifying
Party  notifies  the  Indemnified  Party  that it does  not  dispute  the  claim
described  therein or fails to notify the  Indemnified  Party within the Dispute
Period whether the Indemnifying Party disputes the claim described in such Claim
Notice or Indemnity Notice, as the case may be, the Loss specified in the notice
will be conclusively  deemed to have been incurred by the Indemnified  Party for
purposes  of making  the  determination  set forth in  paragraph  (c) of Section
10.02. If the Indemnifying Party has timely disputed the claim described in such
Claim Notice or Indemnity Notice, as the case may be, the Indemnifying Party and
the  Indemnified  Party will proceed in good faith to negotiate a resolution  of
such dispute,  and if less than $1,000,000 and not resolved through negotiations
within the Resolution  Period,  such dispute shall be resolved by arbitration in
accordance with paragraph (d) of this Section 10.03.

                  (d)   Any dispute  submitted to  arbitration  pursuant to
this Section 10.03 shall be finally and conclusively  determined by the decision
of a board of  arbitration  consisting of three members  (hereinafter  sometimes
called the "Board of Arbitration") selected as hereinafter provided. Each of the
Indemnified Party and the Indemnifying Party shall select one (1) member and the
third member shall be selected by mutual  agreement of the other members,  or if
the other  members fail to reach  agreement on a third member within twenty days
after their  selection,  such third member shall  thereafter  be selected by the
American Arbitration Association upon application made to it for such purpose by
the  Indemnified  Party.  The  Board of  Arbitration  shall  meet in Tampa  Bay,
Florida,  or Baltimore,  Maryland,  as a majority of the members of the Board of
Arbitration  may  determine,  and shall  reach and render a decision  in writing
(concurred  in by a majority  of the members of the Board of  Arbitration)  with
respect to the amount,  if any, which the Indemnifying  Party is required to pay
to the Indemnified  Party in respect of a claim filed by the Indemnified  Party.
In connection with rendering its decisions, the Board of Arbitration shall adopt
and follow such rules and  procedures  as a majority of the members of the Board
of  Arbitration  deems  necessary  or  appropriate.  To  the  extent  practical,
decisions  of the Board of  Arbitration  shall be  rendered  no more than thirty
calendar days following  commencement of proceedings with respect  thereto.  The
Board of  Arbitration  shall cause its written  decision to be  delivered to the
Indemnified Party and the Indemnifying  Party. Any decision made by the Board of
Arbitration (either prior to or after the expiration of such thirty calendar day
period) shall be final,  binding and conclusive on the Indemnified Party and the
Indemnifying  Party and entitled to be enforced to the fullest extent  permitted
by law and  entered in any court of  competent  jurisdiction.  Each party to any
arbitration shall bear its own expense in relation thereto,  including,  but not
limited to, such party's  attorneys'  fees, if any, and the expenses and fees of
the  member of the  Board of  Arbitration  appointed  by such  party,  provided,
however,  that  the  expenses  and  fees of the  third  member  of the  Board of
Arbitration  and any other expenses of the Board of  Arbitration  not capable of
being  attributed  to any one  member  shall  be  borne  in  equal  parts by the
Indemnifying  Party and the  Indemnified  Party  Board of  Arbitration  shall be
divided between the  Indemnifying  Party and the  Indemnified  Party in the same
proportion  as the  portion  of the  related  claim  determined  by the Board of
Arbitration to be payable to the Indemnified  Party bears to the portion of such
claim determined not to be so payable.


                           ARTICLE XI - MISCELLANEOUS

         11.01.   Notices.  All  notices,   requests  and  other  communications
hereunder  must be in writing and will be deemed to have been duly given only if
delivered personally or by facsimile transmission or mailed (first class postage
prepaid) to the parties at the following addresses or facsimile numbers:

         If to Purchaser, to:

         Municipal Mortgage & Equity LLC
         218 North Charles Street, Suite 500
         Baltimore, Maryland 21201-4019
         Facsimile No.:  410-727-5387
         Attn:  Michael L. Falcone

         with a copy to:

         Rogers & Wells LLP
         200 Park Avenue
         New York, New York 10166
         Facsimile No.:  212-878-8375
         Attn:  Robert E. King, Jr.

         and a copy to:

         Gallagher, Evelius & Jones, LLP
         218 N. Charles Street, Suite 400
         Baltimore, Maryland 21201
         Facsimile No.:  410-837-3085
         Attn:  Stephen A. Goldberg

         If to Sellers, to:

         Robert J. Banks
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         and

         Keith J. Gloeckl
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         and

         Ray F. Mathis
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         with a copy to:

         Honigman Miller Schwartz and Cohn
         2290 First National Building
         Detroit, Michigan 48226
         Facsimile No.:  313-465-7357
         Attn:  Gregory J. DeMars

All such  notices,  requests  and  other  communications  will (i) if  delivered
personally  to the  address as provided in this  Section,  be deemed  given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section,  be deemed given upon receipt,  and (iii) if delivered
by mail in the  manner  described  above  to the  address  as  provided  in this
Section,  be deemed given upon receipt (in each case  regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice is to be delivered pursuant to this Section). Any party from
time to time may change its address,  facsimile number or other  information for
the purpose of notices to that party by giving notice  specifying such change to
the other party hereto.

         11.02.  Entire Agreement.  This Agreement and the Operative  Agreements
supersedes all prior discussions and agreements between the parties with respect
to the subject matter hereof and thereof,  including,  without limitation,  that
certain  letter of intent  between the parties dated May 27, 1999,  and contains
the sole and entire  agreement  between the parties  hereto with  respect to the
subject matter hereof and thereof.

         11.03.  Expenses.  Except  as  otherwise  expressly  provided  in  this
Agreement,  whether or not the transactions contemplated hereby are consummated,
each party will pay its own costs and expenses,  and Sellers shall pay the costs
and expenses of the Company and the  Subsidiaries,  incurred in connection  with
the  negotiation,  execution and closing of this Agreement and the  transactions
contemplated hereby.

         11.04.  Public  Announcements.  Sellers and Purchaser will not issue or
make any  reports,  statements  or  releases to the public or  generally  to the
employees,  customers,  suppliers  or other  Persons to whom the Company and the
Subsidiaries  sell goods or provide  services  or with whom the  Company and the
Subsidiaries  otherwise have significant business  relationships with respect to
this Agreement or the  transactions  contemplated  hereby without the consent of
the other, which consent shall not be unreasonably  withheld. If either party is
unable to obtain the  approval of its public  report,  statement or release from
the other  party and such  report,  statement  or release  is, in the opinion of
legal counsel to such party,  required by Law in order to discharge such party's
disclosure  obligations,  then such party may make or issue the legally required
report,  statement or release and  promptly  furnish the other party with a copy
thereof. Sellers and Purchaser will also obtain the other party's prior approval
of any press  release to be issued  immediately  following the execution of this
Agreement and upon Closing.

         11.05.  Confidentiality.  Each party hereto will hold, and will use its
best efforts to cause its Affiliates  and their  respective  Representatives  to
hold, in strict  confidence  from any Person  (other than any such  Affiliate or
Representative),  unless (i) compelled to disclose by judicial or administrative
process  (including,  without  limitation,  in  connection  with  obtaining  the
necessary  approvals of this Agreement and the transactions  contemplated hereby
of  Governmental or Regulatory  Authorities) or by other  requirements of Law or
(ii)  disclosed in an Action or Proceeding  brought by a party hereto in pursuit
of its rights or in the exercise of its remedies  hereunder,  all  documents and
information  concerning the other party or any of its Affiliates furnished to it
by the other party or such other party's Representatives in connection with this
Agreement or the  transactions  contemplated  hereby,  except to the extent that
such documents or information can be shown to have been (a) previously  known by
the party  receiving  such  documents or  information,  (b) in the public domain
(either  prior to or after  the  furnishing  of such  documents  or  information
hereunder) through no fault of such receiving party or (c) later acquired by the
receiving  party from another  source if the  receiving  party is not aware that
such  source  is under an  obligation  to  another  party  hereto  to keep  such
documents and information confidential; provided that the foregoing restrictions
will not apply to Purchaser's  use of documents and  information  concerning the
Company and the Subsidiaries furnished by Sellers hereunder.

         11.06.   Further Assurances; Post-Closing Cooperation.

                  (a)   At  any time or from time to time after the  Closing,
Sellers and Purchaser shall execute and deliver to Purchaser or Sellers,  as the
case may be, such other  documents and  instruments,  provide such materials and
information  and take such other actions as Purchaser or Sellers may  reasonably
request more  effectively  to vest title to the Midland Shares in Purchaser and,
to the full extent  permitted by Law, to put Purchaser in actual  possession and
operating  control  of  the  Company,  the  Subsidiaries,  and  the  Tax  Credit
Partnerships and their  respective  Assets and Properties and Books and Records,
and otherwise to cause Sellers to fulfill their obligations under this Agreement
and the Operative Agreements to which they are parties.

                  (b)   Following  the  Closing,  each party will  afford the
other party,  its counsel and its  accountants,  during normal  business  hours,
reasonable access to the books,  records and other data relating to the Business
or Condition of the Company and the  Subsidiaries in its possession with respect
to  periods  prior to the  Closing  and the right to make  copies  and  extracts
therefrom,  to the extent  that such  access may be  reasonably  required by the
requesting party in connection with (i) the preparation of Tax Returns, (ii) the
determination  or enforcement of rights and  obligations  under this  Agreement,
(iii)  compliance  with  the  requirements  of any  Governmental  or  Regulatory
Authority,  (iv) the  determination or enforcement of the rights and obligations
of any  Indemnified  Party or (v) in  connection  with any actual or  threatened
Action or  Proceeding.  Further,  each party agrees for a period  extending  six
years after the Closing not to destroy or  otherwise  dispose of any such books,
records  and other  data  unless  such  party  shall  first  offer in writing to
surrender  such books,  records and other data to the other party and such other
party shall not agree in writing to take  possession  thereof during the ten day
period after such offer is made.

                  (c)   If,  in order  properly to prepare  its Tax  Returns,
other documents or reports required to be filed with  Governmental or Regulatory
Authorities or its financial statements or to fulfill its obligations hereunder,
it is necessary that a party be furnished with additional information, documents
or records  relating to the Business or Condition of the Company not referred to
in paragraph (b) above,  and such  information,  documents or records are in the
possession  or control of the other  party,  such other party shall use its best
efforts to furnish or make available such information,  documents or records (or
copies thereof) at the recipient's  request,  cost and expense.  Any information
obtained by Sellers in accordance with this paragraph shall be held confidential
by Sellers in accordance with Section 11.05.

                  (d)   Notwithstanding anything to the contrary contained in
paragraphs  (b) and (c) of this  Section,  if the parties are in an  adversarial
relationship  in  litigation or  arbitration,  the  furnishing  of  information,
documents or records in  accordance  with any provision of this Section shall be
subject to applicable rules relating to discovery.

         11.07. Waiver. Any term or condition of this Agreement may be waived at
any time by the party  that is  entitled  to the  benefit  thereof,  but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party  waiving such term or  condition.  No waiver by any
party of any term or condition of this Agreement,  in any one or more instances,
shall be deemed to be or  construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion.  All remedies,  either under
this  Agreement  or by Law or otherwise  afforded,  will be  cumulative  and not
alternative.

         11.08.  Amendment.  Except as set forth in Section 5.08, this Agreement
may be amended,  supplemented  or  modified  only by a written  instrument  duly
executed by or on behalf of each party hereto.

         11.09.  No Third Party  Beneficiary.  The terms and  provisions of this
Agreement  are  intended  solely for the benefit of each party  hereto and their
respective  successors or permitted assigns,  and it is not the intention of the
parties to confer  third-party  beneficiary  rights upon any other  Person other
than any Person entitled to indemnity under Article X.

         11.10. No Assignment;  Binding  Effect.  Neither this Agreement nor any
right,  interest or  obligation  hereunder  may be assigned by any party  hereto
without the prior  written  consent of the other party hereto and any attempt to
do so will be void,  except that  Purchaser may assign any or all of its rights,
interests and obligations hereunder (including,  without limitation,  its rights
under Article X) to a wholly-owned subsidiary, provided that any such subsidiary
agrees in  writing to be bound by all of the terms,  conditions  and  provisions
contained  herein,  but  no  such  assignment  shall  relieve  Purchaser  of its
obligations  hereunder.  Subject to the preceding  sentence,  this  Agreement is
binding upon,  inures to the benefit of and is enforceable by the parties hereto
and their respective successors and assigns.

         11.11.  Headings;  Exhibits.  The headings used in this Agreement or in
any Schedules  have been inserted for  convenience  of reference only and do not
define or limit the  provisions  hereof.  Reference  herein to Exhibits,  unless
indicated,  shall refer to the Exhibits attached to this Agreement, which hereby
are incorporated in and constitute a part of this Agreement.

         11.12.  Breach,  Abandonment,  Termination.  If any party shall fail to
fulfill its obligations hereunder,  including without limitation its obligations
to  close  and  to  satisfy   those   conditions   to  Closing   which  are  its
responsibility,  the other parties shall have all remedies  available to them at
law or in equity, including the right to specific performance.

         11.13.  Consent to  Jurisdiction  and  Service of  Process.  Each party
hereby  irrevocably  submits  to the  non-exclusive  jurisdiction  of the United
States District Court for Northern  District of Maryland and the Middle District
of Florida or any state court located in Baltimore City,  Maryland or Tampa Bay,
Florida in any such action, suit or proceeding, and agrees that any such action,
suit or proceeding shall be brought only in such court (and waives any objection
based on forum non conveniens or any other objection to venue therein).  Nothing
herein shall affect the right of any party to serve  process in any other manner
permitted by Law or to commence legal  proceedings or otherwise  proceed against
the other in any other jurisdiction.

         11.14.  Invalid Provisions.  If any provision of this Agreement is held
to be illegal,  invalid or unenforceable under any present or future Law, and if
the rights or  obligations  of any party hereto under this Agreement will not be
materially  and adversely  affected  thereby,  (a) such  provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or  unenforceable  provision had never comprised a part hereof,  (c) the
remaining  provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal,  invalid or  unenforceable  provision or by
its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision,  there  will be added  automatically  as a part of this  Agreement  a
legal,  valid and  enforceable  provision  as similar in terms to such  illegal,
invalid or unenforceable provision as may be possible.

         11.15. Governing Law. This Agreement shall be governed by and construed
in  accordance  with the Laws of the State of Maryland  applicable to a Contract
executed and performed in such State  without  giving effect to the conflicts of
laws principles thereof.

         11.16.  Counterparts.  This  Agreement may be executed in any number of
counterparts,  each of  which  will be  deemed  an  original,  but all of  which
together will constitute one and the same instrument.


<PAGE>



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

                                               SELLERS:


                                               By: /s/  ROBERT J. BANKS
                                               Robert J. Banks


                                               By: /s/  KEITH J. GLOECKL
                                               Keith J. Gloeckl


                                               By: /s/  RAY F. MATHIS
                                               Ray F. Mathis


                                               PURCHASER:

                                               MUNICIPAL MORTGAGE & EQUITY, LLC




                                               By:  /S/  MICHAEL L. FALCONE
                                               Michael L. Falcone
                                               President and COO
<PAGE>




PRESS RELEASE                    Contact:          Derek K. Cole
                                                   Director, Investor Relations
EMBARGOED UNTIL                                    (888) 788-3863
4:30pm, October 4, 1999


                 MuniMae Agrees to Acquire the Midland Companies
                   --------------------------------------
                   Combined Companies Will Manage $1.7 Billion
              of Multifamily Real Estate Debt & Equity Investments


BALTIMORE,  MD, October 4, 1999 -- Municipal Mortgage & Equity, LLC (NYSE: MMA),
also known as  MuniMae,  a  nationwide  originator,  investor  and  servicer  of
tax-exempt  multifamily  housing  bonds,  announced  today  that it has signed a
binding  agreement to purchase the Midland  Companies  ("Midland"),  a privately
held Fannie Mae lender that originates,  services and asset manages  investments
in multifamily debt and equity on behalf of institutional  investors and for its
own account.  The $45 million  cash-and-stock  transaction  is expected to close
over the next several weeks.

The combined  companies  will manage $1.7 billion of  investments in multifamily
real estate debt and equity. A portfolio of 557 multifamily housing communities,
encompassing  51,926 apartment units in 45 states,  the District of Columbia and
the U.S. Virgin Islands secures the investments.

Midland,  headquartered  in Clearwater,  Florida with offices in Dallas,  Texas,
Detroit, Michigan, Portland, Oregon and San Francisco, California, will continue
to operate under the Midland name. Midland is a Fannie Mae delegated underwriter
and servicer  (DUS),  that manages  construction  and permanent loans as well as
equity  investments  on behalf of its pension  fund  investors,  and also raises
equity from corporations for investments in the federal  affordable  housing tax
credit program.

MuniMae  Chairman  and CEO,  Mark K. Joseph,  commented,  "We believe this is an
excellent  opportunity for MuniMae.  It is a natural  extension of our business.
Acquiring the Midland  Companies  greatly  expands our reach in the  multifamily
finance marketplace.  As one of only three Fannie Mae DUS lenders in the country
which  provides  equity  financing  in  addition  to Fannie Mae debt  financing,
Midland brings MuniMae access to important additional capital resources.  Fannie
Mae is the largest  provider  of capital for housing in the nation.  To join the
Fannie Mae family of lenders opens up new paths of growth for us. Further,  with
Midland's experienced team of loan originators in geographically  diverse areas,
MuniMae will be able to better serve existing  customers and extend our customer
base nationally.  By creating a stronger,  more dynamic  national  organization,
this acquisition will enhance long-term value creation for our shareholders.

We will continue our low leverage  approach to the  multifamily  housing finance
business.  We will  continue to increase  our core  holdings of tax exempt bonds
secured  by  apartment  communities.  We expect  that,  with this  acquisition's
addition to our Cash Available for  Distribution  ("CAD"),  we can not only grow
our tax  exempt  dividend,  but also  lower  our  payout  ratio,  measured  on a
recurring income basis.  Achieving this will both grow MuniMae strategically and
increase the security of the dividend payments to our shareholders."

Midland,  which  includes a holding  company and six operating  companies,  will
become a wholly owned subsidiary of MuniMae. Midland Chairman and CEO, Robert J.
Banks, who will join the MuniMae Board of Directors,  commented, "I am extremely
pleased  to be  joining  MuniMae  as they  seek new  growth  opportunities.  Our
approach to business and our dedication to our customers will remain  unchanged.
We will continue to operate all of our  businesses  under the Midland name,  and
most  importantly,  the quality people at Midland who have built our business to
date will  continue on. The merger was a natural  progression  for Midland.  The
larger equity base and the  additional  access to capital will enable us to grow
and compete more aggressively.  Since 1977, we have originated in excess of $2.6
billion in financing for multifamily  housing involving over 1,300 properties in
48 states.  With the similar business  philosophies and cultures between Midland
and MuniMae,  and with the capital  resources now available to us, we anticipate
an even greater  ability to serve our  customers  needs,  to provide  growth and
challenge for our employees and to enhance shareholder value."

MuniMae President and COO, Michael L. Falcone, commented, "We expect the Midland
transaction to be accretive to CAD per share in 2000.  Further, it will increase
the  percentage of income to  shareholders  which is exempt from Federal  income
taxes.  Managing over $1.7 billion of investments in real estate debt and equity
begins to give us economies of scale that we could not  previously  obtain.  The
addition of the Midland  product line will enable us to capture a larger  volume
of deals,  while enabling Midland to aggressively  offer  additional  tax-exempt
financing  alternatives  to its  customers.  Everyone  at MuniMae and Midland is
excited about the future for our customers, our employees and our shareholders."

MuniMae has agreed to pay $45 million for Midland. At closing,  $23 million will
be paid in cash and $12 million in stock.  Assuming certain  performance targets
are met,  including an annual  contribution  to CAD of at least $6 million,  $10
million in additional stock will be paid over the next three years.

MuniMae  originates,  invests in and  services  tax-exempt  multifamily  housing
bonds. The 76 multifamily  housing  communities that secure MuniMae's  portfolio
are located in 38 markets in 18 states and the District of Columbia, and contain
18,767  units  with an  average  occupancy  of  94%.  The  properties  represent
approximately  $750 million in real estate  value.  Over half of MuniMae's  bond
assets  provide  for the  Company  to  participate  in the  appreciation  of the
underlying   apartments  on  a  tax-exempt  basis  through  contingent  interest
payments.

MuniMae is organized as a limited liability company,  which makes it exempt from
tax at the corporate level and provides the benefit of corporate governance.  In
addition,  the Company passes through to its shareholders  primarily  tax-exempt
dividends,  which are generated by its municipal bond investments.  Dividends to
shareholders  are  declared  quarterly  and paid in  February,  May,  August and
November.

The comments of MuniMae  Chairman  Joseph,  Midland  Chairman  Banks and MuniMae
President  Falcone  contain  statements  that are forward  looking in nature and
reflect  management's  current views with respect to future events and financial
performance.  These statements are subject to many  uncertainties  and risks and
should not be considered  guarantees of future  performance.  Actual results may
vary materially from projected  results based on a number of factors,  including
the  actual  performance  of  the  properties  pledged  as  collateral  for  the
portfolio,  general  conditions  in the local real  estate  markets in which the
properties are located and prevailing interest rates.

             MUNIMAE: TAX-EXEMPT DIVIDENDS AND GROWTH THROUGH REAL ESTATE
                        www.munimae.com www.gomidland.com
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SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
                     PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                               September 30, 1999
                Date of Report (Date of earliest event reported)

                         MUNICIPAL MORTGAGE & EQUITY, LLC
             (Exact Name of Registrant as Specified in its Charter)

    Delaware               001-11981                      52-1449733
 (State or Other     (Commission File Number)  (IRS Employer Identification No.)
 Jurisdiction of
  Incorporation)

                       218 North Charles Street, Suite 500
                            Baltimore, Maryland 21201
               (Address of Principal Executive Office) (Zip Code)

                                 (410) 962-8044
              (Registrant's telephone number, including area code)
Item 5. Other Events.

(a)      On September 30, 1999,  Municipal  Mortgage & Equity, LLC  ("MuniMae")
         agreed to acquire 100% of the capital stock of Midland Financial
         Holdings,  Inc. ("Midland"),  a Florida corporation,  from Messrs.
         Robert Banks, Keith Gloekl and Ray Mathis,  for up to $45  million.  Of
         this  amount,  $23 million in cash and $12 million in MuniMae  common
         shares  will  be  paid  at  the  closing  of  the  transaction,
         respectively, subject  to  certain  post-closing adjustments, and $3.33
         million in MuniMae  common shares is payable annually over a three year
         period if Midland meets certain performance  targets,  including an
         annual contribution to CAD of at least $6.0 million in year one, $6.25
         million in year two and $6.5 million in year three.  MuniMae expects to
         close this  transaction  by the end of  October  1999,  subject  to
         regulatory approvals, the expiration  of  notice  periods  and  certain
         other conditions.  MuniMae expects to fund the $23 million up-front
         payment from its working capital.

         Midland is a fully integrated real estate  investment firm specializing
         in  providing  debt  and  equity  capital  to the  multifamily  housing
         industry,  particularly in the area of affordable housing.  Since 1977,
         Midland  has  originated  $2.6  billion in  financing  for  multifamily
         housing. Midland currently has approximately $225 million of assets, of
         which  98%  represents   construction   loans,   and  $217  million  of
         liabilities of which 98% represents  Notes  Payable.  Midland  operates
         primarily in the following related areas:

          o   Commercial  Mortgage  Banking.  Midland provides  construction and
              permanent debt financing,  mortgage servicing and asset management
              services to the multifamily housing industry.  Midland is a Fannie
              Mae DUS lender and a FHA approved mortgagee.
Midland's Portfolio (in 000's)
Construction Loans Outstanding:
                  Construction loans for own account                   $  85,212
                  Construction loans for which risk is indemnified
                           by a third party*                           $ 136,060
                                                                       ---------
                  Total Construction Loans Outstanding                 $ 221,272
                                                                       =========

         Permanent Loan Servicing Portfolio:
                  Permanent  loans  serviced for FNMA with
                           risk sharing                                $  92,409
                  Permanent loans serviced for FNMA where risk is
                           indemnified by a third party*               $ 168,000
                  Permanent loans serviced which do not have risk      $ 246,305
                                                                       ---------
                  Total Permanent Loans Serviced                       $ 506,714
                                                                       =========

         *  The Midland Affordable Housing Group Trust indemnifies Midland for
            risks associated with approximately $136 million of construction
            loans and approximately $168 million of permanent loans serviced.
o   Equity Syndication and Asset Management. Midland syndicates equity
              for  investment  in low income  housing tax credits.  Midland also
              syndicates   equity  and   originates   debt  for   investment  in
              student/conventional  housing, a unique and growing segment of the
              multifamily  housing  industry.  Midland  currently  manages  $295
              million of such equity.

          o   Pension  Fund  Advisory.   Midland  Advisory  Services,   Inc.,  a
              registered  investment  advisor with the  Securities  and Exchange
              Commission  and  a  wholly-owned  special  purpose  subsidiary  of
              Midland,  provides  advisory  services to pension  funds.  Midland
              currently manages $259 million of such equity.

          o   Ancillary  Businesses  -  Real  Estate   Brokerage/Management  and
              Securities  Dealer.  Midland  Realty  Investment  Corporation,   a
              wholly-owned  special  purpose  subsidiary  of Midland,  acts as a
              licensed real estate broker in the states of Florida, Michigan and
              California.  Midland Securities  Corporation,  a registered broker
              dealer with the National  Association of Securities  Dealers and a
              wholly-owned  special  purpose  subsidiary  of  Midland,   markets
              syndications  of equity for real estate  investments  and provides
              securities broker dealer services.

         Midland has over 100  employees.  It is  headquartered  in  Clearwater,
         Florida,  and has  branch  offices  in Dallas,  Texas,  San  Francisco,
         California,   Portland,  Oregon  and  Detroit,  Michigan.

         Upon  closing of the  acquisition,  the  combined  companies  will have
         approximately  $1.7  billion of  investments  in real  estate  debt and
         equity under asset management:

          o  $429 million of tax-exempt bonds for its own account
             o  $222 million of participating bonds
             o  $207 million of fixed rate bonds
          o  $113 million of taxable mortgages for its own account
          o  $1.15 billion under management for others
             o  $722 million of permanent loans
             o  $136 million of construction loans
             o  $295 million of equity

         The combined company's property portfolio will have:
          o  557 properties
          o  51,926 units
          o  94% occupancy (as of 6/30/99)
          o  Geographic diversity - properties located in 45 states, the
             District of Columbia and the U.S. Virgin Islands

         The combined property portfolio will be broken out as:

         Own account
          o  101 properties
          o  20,835 units
          o  94% occupancy (as of 6/30/99)
          o  Properties located in 22 states, the District of Columbia and the
             U.S. Virgin Islands

         Managed for others
          o  456 properties
          o  31,091 properties
          o  94% occupancy (as of 6/30/99)
          o  Properties located in 44 states

         A copy  of  MuniMae's  press  release  announcing  the  transaction  is
attached hereto as Exhibit 99.1.

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

(c)      Exhibits.

         2.1  Stock  Purchase and  Contribution  Agreement  dated as of
              September  30,  1999,  by and among  Municipal Mortgage & Equity,
              LLC, and Robert J. Banks, Keith J. Gloekl and Ray F. Mathis.

         99.1 Press Release of Municipal Mortgage & Equity, LLC, dated
              October 4, 1999.
SIGNATURES

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  Registrant  has duly  caused  this Report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                 MUNICIPAL MORTGAGE & EQUITY, LLC

                                 By:        /s/ Michael L. Falcone
                                          Michael L. Falcone
                                          President and Chief Operating Officer

Date:  October 7, 1999
EXHIBIT INDEX

Exhibit No.                Exhibit

2.1                        Stock  Purchase  and  Contribution  Agreement  dated
                           as of September 30, 1999,  by and  among Municipal
                           Mortgage & Equity, LLC, and Robert J. Banks,
                           Keith J. Gloekl and Ray F. Mathis.

99.1                       Press Release of Municipal Mortgage & Equity, LLC,
                           dated October 4, 1999.
STOCK PURCHASE AND CONTRIBUTION AGREEMENT

                         dated as of September 30, 1999

                                 by and between

                        MUNICIPAL MORTGAGE & EQUITY, LLC

                                       and

                                 ROBERT J. BANKS

                                KEITH J. GLOECKL

                                       and

                                  RAY F. MATHIS

                               with respect to all

                          outstanding capital stock of

                        MIDLAND FINANCIAL HOLDINGS, INC.
TABLE OF CONTENTS

ARTICLE I  - DEFINITIONS......................................................1

         1.01         Definitions.............................................1

ARTICLE II - SALE AND CONTRIBUTION OF SHARES AND CLOSING.....................10

         2.01         Contribution, Purchase and Sale........................10

         2.02         Consideration..........................................10

         2.03         Closing................................................11

         2.04         Deferred Purchase Price................................12

         2.05         Adjustment to Deferred Purchase Price..................13

         2.06         Balance Sheet Adjustment...............................13

ARTICLE III - REPRESENTATIONS AND WARRANTIES OF SELLERS......................14

         3.01         Sellers................................................14

         3.02         Authority..............................................14

         3.03         Organization of the Company............................14

         3.04.        Capital Stock..........................................14

         3.05.        Subsidiaries...........................................14

         3.06.        No Conflicts...........................................15

         3.07.        Governmental Approvals and Filings.....................15

         3.08.        Financial Statements...................................15

         3.09.        Absence of Changes.....................................16

         3.10.        Taxes..................................................18

         3.11.        Legal Proceedings......................................19

         3.12.        Compliance With Laws and Orders........................20

         3.13.        Benefit Plans; ERISA...................................20

         3.14.        Real Property..........................................22

         3.15.        Tangible Personal Property.............................22

         3.16.        Intellectual Property Rights...........................23

         3.17.        Contracts..............................................23

         3.18.        Licenses...............................................25

         3.19.        Insurance..............................................25

         3.20.        Employees; Labor Relations.............................25

         3.21.        Substantial Business Relationships.....................26

         3.22.        No Powers of Attorney..................................27

         3.23         Assets.................................................27

         3.24.        Brokers................................................27

         3.25.        Year 2000 Compliance...................................27

         3.26.        Status of Outstanding Loans............................27

         3.27.        Status of Tax Credit Transactions......................28

         3.28.        No Undisclosed Liabilities.............................29

         3.29.        Affiliate Transactions.................................29

         3.30.        Books and Records......................................29

         3.31.        Qualification to do Business...........................29

         3.32.        Environmental Matters..................................29

         3.33.        Watch List.............................................30

ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF PURCHASER.....................30

         4.01.        Organization...........................................30

         4.02.        Authority..............................................30

         4.03.        Issuance of Common Shares..............................30

         4.04.        No Conflicts...........................................31

         4.05.        Governmental Approvals and Filings.....................31

         4.06.        Legal Proceedings......................................31

         4.07.        Purchase for Investment................................31

         4.08.        Brokers................................................31

         4.09         Disclosure.............................................32

         4.10         Financial Statements...................................32

         4.11         Organizational Documents...............................32

         4.12         SEC Filings............................................32

         4.13         Tax Matters............................................32

         4.14         Knowledge..............................................33

         4.15         Purchaser's Expertise and Investigation................33

         4.16         MESC Notice............................................34

ARTICLE V - COVENANTS OF SELLERS.............................................34

         5.01.        Regulatory and Other Approvals.........................34

         5.02.        Books and Records......................................35

         5.03.        Notice and Cure........................................35

         5.04.        Continued Access.......................................35

         5.05.        Operation of the Business Prior to Closing.............35

         5.06.        Disclosure; Shopping...................................35

         5.07         Tax Credit Entities; Ownership and Control.............35

         5.08         Updating of Schedules..................................36

         5.09         Affiliate Transactions.................................36

         5.10         Closing Share Restrictions.............................36

ARTICLE VI - COVENANTS OF PURCHASER..........................................37

         6.01.        Regulatory and Other Approvals.........................37

         6.02.        Notice and Cure........................................37

         6.03         Limitation of Sellers'Liabilities......................37

         6.04         Employees..............................................38

         6.05         Post-Closing Operations of the Company and the
                      Subsidiaries...........................................38

         6.06         704(c) Gain............................................38

ARTICLE VII - TAX MATTERS AND POST-CLOSING TAXES.............................38

         7.01.        Pre-Closing Tax Returns................................38

         7.02.        Transfer Taxes.........................................39

         7.03.        Post-Closing Taxes and Sellers'Post-Closing Taxes......39

         7.04.        Notification of Audits.................................40

         7.05.        Maintenance of Records.................................40

         7.06.        Purchase Price Adjustment..............................40

         7.07.        Tax Sharing Agreements.................................40

ARTICLE VIII - CONDITIONS TO CLOSING.........................................40

         8.01         Conditions to Purchaser's Performance..................40

         8.02         Conditions to Sellers' Performance.....................42

ARTICLE IX - SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND
               AGREEMENTS....................................................43
         9.01         Survival of Representations, Warranties, Covenants
                      and Agreements.........................................43

article x - INDEMNIFICATION..................................................44

         10.01.       Tax Indemnifications...................................44

         10.02.       Other Indemnification..................................44

         10.03.       Method of Asserting Claims.............................45

ARTICLE XI - MISCELLANEOUS...................................................48

         11.01.       Notices................................................48

         11.02.       Entire Agreement.......................................49

         11.03.       Expenses...............................................49

         11.04.       Public Announcements...................................50

         11.05.       Confidentiality........................................50

         11.06.       Further Assurances; Post-Closing Cooperation...........50

         11.07.       Waiver.................................................51

         11.08.       Amendment..............................................51

         11.09.       No Third Party Beneficiary.............................52

         11.10.       No Assignment; Binding Effect..........................52

         11.11.       Headings; Exhibits.....................................52

         11.12.       Breach, Abandonment, Termination.......................52

         11.13.       Consent to Jurisdiction and Service of Process.........52

         11.14.       Invalid Provisions.....................................52

         11.15.       Governing Law..........................................53

         11.16.       Counterparts...........................................53

Exhibits

         A --     Earn-Out Examples
         B --     Employment Agreements
         C --     Registration Rights Agreement
This STOCK PURCHASE AND  CONTRIBUTION  AGREEMENT  dated as of September
30, 1999 is made and entered  into by and between  MUNICIPAL  MORTGAGE & EQUITY,
LLC, a Delaware limited  liability company  ("Purchaser"),  and Robert J. Banks,
Keith J. Gloeckl and RAY F. Mathis (together  "Sellers").  Capitalized terms not
otherwise defined herein have the meanings set forth in Section 1.01.

         WHEREAS, Sellers own in the aggregate 1,000 shares of common stock, par
value  $0.10  per  share,  of  Midland  Financial  Holdings,   Inc.,  a  Florida
corporation (the "Company"),  constituting all issued and outstanding  shares of
capital  stock of the  Company  (such  shares  being  referred  to herein as the
"Midland Shares"); and

         WHEREAS,  Sellers desire to contribute and sell, and Purchaser  desires
to acquire  and  purchase,  the  Midland  Shares on the terms and subject to the
conditions set forth in this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration,  the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         1.01     Definitions.

                  (a)   As used in this Agreement,  the following defined terms,
when used with initial capital letters, shall have the meanings indicated below:

         "Actions  or   Proceedings"   means  any  action,   suit,   proceeding,
arbitration or Governmental or Regulatory Authority audit.

         "Affiliate" means any Person that directly,  or indirectly  through one
of more intermediaries,  controls or is controlled by or is under common control
with the Person specified. For purposes of this definition,  control of a Person
means the power,  direct or  indirect,  to direct or cause the  direction of the
management  and policies of such Person whether by Contract or otherwise and, in
any event and without limitation of the previous sentence, any Person owning ten
percent or more of the voting  securities  of a second Person shall be deemed to
control that second Person.

         "Agreement"  means this Stock Purchase and  Contribution  Agreement and
the Exhibits,  together with the Disclosure  Schedule and the Schedules attached
thereto, as the same shall be amended from time to time.

         "Assets and  Properties"  of any Person means all assets and properties
of every kind,  nature,  character and  description  (whether real,  personal or
mixed, whether tangible or intangible,  whether absolute,  accrued,  contingent,
fixed or  otherwise  and wherever  situated),  including  the  goodwill  related
thereto,   operated,  owned  or  leased  by  such  Person,  including,   without
limitation,  cash,  cash  equivalents,  Investment  Assets,  accounts  and notes
receivable,  chattel paper, documents,  instruments,  general intangibles,  real
estate, equipment, inventory, goods and Intellectual Property.

         "Associate" means, with respect to any Person, any corporation or other
business  organization  of which such  Person is an officer or partner or is the
beneficial owner, directly or indirectly, of ten percent or more of any class of
equity  securities,  any trust or estate in which such Person has a  substantial
beneficial  interest  or as to which  such  Person  serves as a trustee  or in a
similar  capacity and any relative or spouse of such Person,  or any relative of
such spouse, who has the same home as such Person.

         "Audited Financial Statement Date" means December 31, 1998.

         "Audited Financial  Statements" means the Financial  Statements for the
fiscal year of the Company ended December 31, 1998.

         "Benefit  Plan" means any Plan existing prior to or on the date hereof,
which  the  Company,  any  Subsidiary  or any  ERISA  Affiliate  has at any time
sponsored,  established,  maintained  or  contributed  to,  or under  which  any
employee,  former  employee or director of the Company or any  Subsidiary or any
beneficiary thereof is covered, is eligible for coverage or has benefit rights.

         "Board of Arbitration" shall have the meaning set forth in Section
10.03(d).

         "Books and Records" means all material files,  documents,  instruments,
papers,  books and records relating to the Business or Condition of the Company,
including,  without limitation,  financial  statements,  Tax Returns and related
work papers and letters from accountants,  budgets, pricing guidelines, ledgers,
journals,  deeds,  title policies,  minute books,  stock certificates and books,
stock transfer ledgers, Contracts,  Licenses, customer lists, computer files and
programs, retrieval programs, operating data and plans and environmental studies
and plans.

         "Borrower"  means the  borrower  on any loan  which the  Company or any
Subsidiary  originated,  holds,  or  services,  or  which  the  Company  or  any
Subsidiary has sold under any arrangement  wherein the Company or any Subsidiary
retains any risk of loss.

         "Business  Combination"  means with  respect to any Person any  merger,
consolidation or combination to which such Person is a party, any sale, or other
disposition  of all or  substantially  all of the capital  stock or other equity
interests of such Person or any sale,  dividend or other  disposition  of all or
substantially all of the Assets and Properties of such Person.

         "Business  Day" means a day other than  Saturday,  Sunday or any day on
which banks  located in any of the States of Florida,  Maryland and New York are
authorized or obligated to close.

         "Business or Condition of the Company"  means the  business,  condition
(financial or otherwise),  results of  operations,  Assets and Properties of the
Company and the Subsidiaries taken as a whole.

         "Cash Closing Payment" shall have the meaning set forth in Section
2.03.

         "Claim Notice" means written notification  pursuant to Section 10.03(a)
of a Third Party Claim as to which indemnity under Section 10.02 is sought by an
Indemnified Party, enclosing a copy of all papers served, if any, and specifying
the  nature of and  basis for such  Third  Party  Claim and for the  Indemnified
Party's claim against the Indemnifying Party under Section 10.02,  together with
the amount  or, if not then  reasonably  ascertainable,  the  estimated  amount,
determined in good faith, of such Third Party Claim.

         "Closing" means the closing of the transactions contemplated by
Section 2.03.

         "Closing  Agreement" means a written and legally binding agreement with
a Governmental or Regulatory Authority relating to Taxes.

         "Closing Audit" shall have the meaning set forth in Section 2.05.

         "Closing Date" shall have the meaning set forth in Section 2.03(a).

         "Closing Payment" shall have the meaning set forth in Section 2.03.

         "Code" means the Internal  Revenue  Code of 1986,  as amended,  and the
rules and regulations promulgated thereunder.

         "Company" shall have the meaning set forth in the forepart of this
Agreement.

         "Contract"  means  any  agreement,  lease,  evidence  of  Indebtedness,
mortgage,  indenture,  security  agreement or other contract (whether oral or in
writing).

         "Deferred Purchase Price" shall have the meaning set forth in Section
2.04.

         "Defined  Benefit  Plan" means each Plan which is subject to Part 3 of
Title 1 of ERISA,  Section 412  of the Code or Title IV of ERISA.

         "Disclosure  Schedule"  means the schedules  delivered to Purchaser and
Sellers simultaneously  herewith and dated as of the date hereof pursuant to the
terms of this  Agreement,  containing  all lists,  descriptions,  exceptions and
other  information  and  materials as are  required to be included  therein from
Sellers or Purchaser  pursuant to this  Agreement,  except that, with respect to
Schedules 4.04 and 4.05,  "Disclosure Schedule" means the schedules delivered to
Sellers by Purchaser  herewith and dated as of the date hereof,  containing  all
lists,  descriptions,  exceptions  and other  information  and  materials as are
required to be included therein from Purchaser pursuant to this Agreement.

         "Dispute  Period" means the period ending 90 calendar days following
receipt by an Indemnifying Party of either a Claim Notice or an Indemnity
Notice.

         "DUS" means the Delegated  Underwriting  and  Servicing  relationships,
status and guidelines as defined by Fannie Mae in its agreements and guidelines.

         "Earn-out  Period"  means the period from Closing  until  September 30,
2002.

         "Earn-out Shares" shall have the meaning set forth in Section 2.04.

         "Employment Agreements" shall have the meaning set forth in Section
8.01.

         "ERISA" means the Employee  Retirement  Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.

         "ERISA  Affiliate" means any Person who is in the same controlled group
of corporations or who is under common control,  or is otherwise  deemed to be a
single  employer,  with  Sellers  or,  before the  Closing,  the  Company or any
Subsidiary, pursuant to Section 414 of the Code.

         "Environmental  Law"  means  any  Law  relating  to  protection  of the
environment  or to emissions,  discharges,  releases or  threatened  releases of
pollutants,  contaminants or Hazardous Materials in the environment  (including,
without  limitation,  ambient air, surface water,  ground water, land surface or
subsurface strata), or otherwise relating to the treatment,  storage or disposal
of any Hazardous Material.

         "Fannie Mae" or "FNMA" means the Federal National Mortgage Association.

         "FHLA" means the Farmers Home Loan Association.

         "Financial  Statements" means the consolidated  financial statements of
the Company and its consolidated Subsidiaries delivered to Purchaser pursuant to
Section 3.08.

         "GAAP" means generally  accepted  accounting  principles,  consistently
applied  throughout the specified period and in the immediately prior comparable
period.

         "GNMA" means the Government National Mortgage Association.

         "Governmental  or  Regulatory  Authority"  means any  court,  tribunal,
arbitrator,  authority, agency, commission, official or other instrumentality of
the United States, any foreign country or any domestic or foreign state, county,
city or other political subdivision.

         "Hazardous Material" means (i) any chemicals,  materials, substances or
wastes  which  are  now  or  hereafter  become  defined  as or  included  in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic  pollutants" or words of similar  import,  under any  Environmental  Law,
including, without limitation, any petroleum or petroleum products,  radioactive
materials,  asbestos  in  any  form  that  is  or  could  become  friable,  urea
formaldehyde  foam  insulation and  transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls (PCBs); and (ii)
any other chemical,  material,  substance or waste,  exposure to which is now or
hereafter  prohibited,  limited or regulated by any  Governmental  or Regulatory
Authority.

         "HSR  Act"  means  Section  7A of  the  Clayton  Act  (Title  II of the
Hart-Scott-Rodino  Antitrust Improvements Act of 1976, as amended) and the rules
and regulations promulgated thereunder.

         "HUD" means the United States Department of Housing and Urban
Development.

         "Indebtedness"  of any Person means all  obligations of such Person (i)
for borrowed  money,  (ii)  evidenced  by notes,  bonds,  debentures  or similar
instruments,  (iii) for the deferred  purchase price of goods or services (other
than trade  payables or accruals  incurred in the ordinary  course of business),
(iv) under capital leases and (v) in the nature of guarantees of the obligations
described in clauses (i) through (iv) above of any other Person.

         "Indemnified Party" means any Person claiming indemnification under any
provision of Article X,  including,  without  limitation,  a Person  asserting a
claim pursuant to paragraph (c) of Section 10.03.

         "Indemnifying  Party"  means  any  Person  against  whom  a  claim  for
indemnification  is being asserted under any provision of Article X,  including,
without  limitation,  a Person  against  whom a claim is  asserted  pursuant  to
paragraph (c) of Section 10.03.

         "Indemnity  Notice"  means  written  notification  pursuant  to Section
10.03(b)  of a claim for  indemnity  under  Article X by an  Indemnified  Party,
specifying the nature of and basis for such claim,  together with the amount or,
if not then reasonably  ascertainable,  the estimated amount, determined in good
faith, of such claim.

         "Intellectual Property" means all patents and patent rights, trademarks
and  trademark  rights,  trade names and trade name  rights,  service  marks and
service  mark  rights,  service  names and service  name  rights,  brand  names,
inventions,  processes,  formulae, copyrights and copyright rights, trade dress,
business and product names, logos,  slogans,  trade secrets,  industrial models,
processes,  designs,  methodologies,  computer  programs  (including  all source
codes)  and  related  documentation,   technical   information,   manufacturing,
engineering and technical  drawings,  know-how and all pending  applications for
and registrations of patents, trademarks, service marks and copyrights.

         "Investment Assets" means all debentures,  notes and other evidences of
Indebtedness,  stocks,  securities  (including rights to purchase and securities
convertible  into or  exchangeable  for other  securities),  interests  in joint
ventures  and  general  and  limited  partnerships,  mortgage  loans  and  other
investment or portfolio assets owned of record or beneficially by the Company or
any Subsidiary (other than securities issued by any Subsidiary).

         "IRS" means the United States Internal Revenue Service.

         "Knowledge"  with  respect to Sellers,  the Company or any  Subsidiary,
Affiliates or  Associates  means the actual  knowledge of Sellers only,  without
inquiry or investigation by the Sellers (unless otherwise stated in the text).

         "Laws" means all laws,  statutes,  rules,  regulations,  ordinances and
other pronouncements  having the effect of law of the United States, any foreign
country  or any  domestic  or foreign  state,  county,  city or other  political
subdivision or of any Governmental or Regulatory Authority.

         "Liabilities" means all Indebtedness, obligations and other liabilities
of a Person  (whether  absolute,  accrued,  contingent,  fixed or otherwise,  or
whether due or to become due).

         "Licenses"  means  all  material  licenses,  permits,  certificates  of
authority,  authorizations,  approvals,  registrations,  franchises  and similar
consents granted or issued by any Governmental or Regulatory Authority.

         "Liens"  means any mortgage,  pledge,  assessment,  security  interest,
lease,  lien,  adverse claim,  levy, charge or other encumbrance of any kind, or
any conditional  sale Contract,  title  retention  Contract or other Contract to
give any of the foregoing.

         "Loss" means any and all damages, fines, fees, penalties, deficiencies,
losses and  expenses  (including,  without  limitation,  interest,  court costs,
reasonable fees of attorneys, accountants and other experts or other expenses of
litigation or other proceedings or of any claim, default or assessment).

         "MAHGT" means the Midland Affordable Housing Group Trust.

         "Material  Adverse  Effect"  means a  material  adverse  effect  on the
business,  financial  condition or results of  operations of the Company and the
Subsidiaries taken as a whole with a potential exposure of more than $100,000.

         "Material Contracts" shall have the meaning set forth in Section 3.17.

         "Midland Shares" shall have the meaning set forth in the forepart of
this Agreement.

         "MMI" means Midland Mortgage Investment Corporation.

         "MMI  Interest  Strip"  means any  interest  strip,  interest  payable,
interest  reservation or similar right, payment or benefit created in connection
with the sale of any loan by, and reserved  unto,  MMI and/or  MAHGT,  including
without limitation,  rights described in Paragraph 6 of that certain Lending and
Warehousing  Agreement  dated as of  September  1, 1997  between  MMI and MAHGT,
regardless of how characterized on the books and records of MMI and/or MAHGT.

         "Net  Income"  means the  Company's  net income  before  income  taxes,
amortization  and  depreciation  expense  determined  using  the  Company's  "as
purchased"  cost  structure  and  accounting   principles  consistent  with  the
Company's  historical  practice.  For  purposes  of  determining  payment of the
Deferred Purchase Price under Section 2.04: Net Income shall be calculated as if
the Company and its Subsidiaries continued to operate independently of Purchaser
and on a  stand-alone  basis,  without  including  any  income,  loss or expense
attributable  to  any of  Purchaser's,  or its  Subsidiaries',  Affiliates'  and
Associates', other operations or business, even if certain of such operations or
business are allocated to or conducted in conjunction with the Company or any of
its  Subsidiaries;  notwithstanding  the preceding  clause,  for any transaction
between  Purchaser  (or its  Subsidiaries)  and  existing  customers  (as of the
Closing Date) of the Company and its Subsidiaries, or for which the Company, its
Subsidiaries,  or the Sellers are  responsible,  Purchaser  and Sellers will use
good faith  efforts to agree to a fair  allocation  of income and  expense at or
prior to the closing of such transaction.  Net Income shall exclude MMI Interest
Strip  income and all one-time  out-of-pocket  costs and expenses of the Company
incurred  in  connection  with the  negotiation,  execution  and closing of this
Agreement and the transactions contemplated hereby and any cost or expense which
is subject to indemnification under this Agreement or covered by insurance;  and
Net Income shall include any sales proceeds (net of direct expense not otherwise
deductible  in  determining   Net  Income)   received  by  the  Company  or  its
Subsidiaries in connection with the sale of the Company's (or any  Subsidiary's)
right to low income  housing tax credits  arising from the  Company's tax credit
syndication  business or the sale of any general  partner  interest owned by the
Company  (or  any  Subsidiary)  in  any  Tax  Credit  Partnership  or  Operating
Partnership.  The Company's  historical practice shall be based on the practices
certified  to by  PricewaterhouseCoopers  in  preparing  the  Company's  Audited
Financial  Statements  for 1998 and prior  years.  In the  event of any  dispute
between  Sellers and Purchaser as to the proper  allocation of an item of income
or expense for purposes of calculating Net Income, the dispute shall be referred
to an  independent  public  accounting  firm  mutually  agreeable to Sellers and
Purchaser, whose decision shall be final and conclusive absent manifest error.

         "Operating  Partnership" means a partnership or other entity in which a
Tax Credit  Partnership or other entity syndicated or arranged by the Company or
a Subsidiary  has invested for the purpose of obtaining  low income  housing tax
credits.

         "Operative   Agreements"   means   the   Employment   Agreements,   the
Registration  Rights  Agreement,  and any other agreements to be entered into in
connection with the transactions contemplated herein.

         "Option"  with  respect  to  any  Person  means  any  security,  right,
subscription,  warrant,  option,  "phantom"  stock right or other  Contract that
gives the right to (i) purchase or otherwise  receive or be issued any shares of
capital  stock of such Person or any  security of any kind  convertible  into or
exchangeable  or  exercisable  for any shares of capital stock of such Person or
(ii) receive any benefits or rights similar to any rights enjoyed by or accruing
to the holder of shares of capital stock of such Person, including any rights to
participate  in the equity,  income or election of directors or officers of such
Person.

         "Order" means any writ, judgment,  decree,  injunction or similar order
of  any  Governmental  or  Regulatory  Authority  (in  each  such  case  whether
preliminary or final).

         "Pension  Benefit  Plan"  means  each  Benefit  Plan which is a pension
benefit plan within the meaning of Section 3(2) of ERISA, whether or not subject
to ERISA.

         "Permitted Lien" means (i) any Lien for Taxes not yet due or delinquent
or which is being  contested in good faith by  appropriate  proceedings or which
has been bonded off and for which  adequate  reserves have been  established  in
accordance with GAAP or defense has been accepted by any insurance company, (ii)
any  statutory  Lien arising in the ordinary  course of business by operation of
Law with respect to a Liability  that is not yet due or  delinquent  or which is
being  contested in good faith by  appropriate  proceedings  for which  adequate
reserves have been established in accordance with GAAP or which have been bonded
off or defense has been accepted by any  insurance or bonding  company and (iii)
any other  Lien which  individually  or in the  aggregate  with other such Liens
would not reasonably be expected to have a Material Adverse Effect.

         "Person" means any natural person,  corporation,  general  partnership,
limited partnership, limited liability company,  proprietorship,  other business
organization, trust, union, association or Governmental or Regulatory Authority.

         "Plan" means any bonus, incentive compensation,  deferred compensation,
pension,  profit  sharing,  retirement,  stock  purchase,  stock  option,  stock
ownership,  stock appreciation rights, phantom stock, leave of absence,  layoff,
vacation,  day or dependent  care,  legal  services,  cafeteria,  life,  health,
accident, disability or other insurance, severance, separation or other employee
benefit plan,  practice,  policy or arrangement of any kind,  whether written or
oral,  and  whether or not subject to ERISA  including,  but not limited to, any
"employee benefit plan" within the meaning of Section 3(3) of ERISA.

         "Post-Closing Tax Returns" shall have the meaning set forth in Section
7.03(a).

         "Post-Closing Taxes" shall have the meaning set forth in Section
7.03(a).

         "Pre-Closing Taxes" shall have the meaning set forth in Section 7.01.

         "Pre-Closing Tax Returns" shall have the meaning set forth in Section
7.01.

         "Purchase Price" shall have the meaning set forth in Section 2.02.

         "Purchaser" shall have the meaning set forth in the forepart of this
Agreement.

         "Purchaser Common Shares" means the common shares, no par value, of
Purchaser.

         "Purchaser Closing Shares" shall have the meaning set forth in Section
2.03(b).

         "Qualified  Plan" means each  benefit plan which is intended to qualify
under Section 401 of the Code.

         "Registration Rights Agreement" shall have the meaning set forth in
Section 8.02(e).

         "Representatives"  means the officers,  directors,  employees,  agents,
counsel, accountants, financial advisors, consultants, and other representatives
of a Person.

         "Resolution  Period"  means the period ending thirty (30) calendar days
following  receipt by an  Indemnified  Party of an  Indemnity  Notice or a Claim
Notice.

         "SEC" shall have the meaning set forth in Section 4.09.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Sellers" shall have the meaning set forth in the forepart of this
Agreement.

         "Sellers' Post-Closing Taxes" shall have the meaning set forth in
Section 7.03(b).

         "Sellers' Tax Costs" shall have the meaning set forth in Section 10.01.

         "Share Closing Payment" shall have the meaning set forth in Section
2.03.

         "Subsidiary"  means  any  Person  in which  the  Company,  directly  or
indirectly through Subsidiaries or otherwise, beneficially owns more than 50% of
either the equity interests in, or the voting control of, such Person.

         "Surplus" shall have the meaning set forth in Section 2.04(b).

         "Tax or Taxes"  means any  federal,  state,  county,  local or  foreign
taxes,  charges,  fees, levies, or other assessments,  including all net income,
gross  income,  sales and use, ad valorem,  transfer,  gains,  profits,  excise,
franchise, real and personal property, gross receipt, capital stock, production,
business and occupation,  disability,  employment,  payroll, license, estimated,
stamp,  custom duties,  severance or withholding taxes or charges imposed by any
governmental entity, and includes any interest and penalties (civil or criminal)
on or additions to any such taxes.

         "Tax Credit Partnership" means a partnership or other entity syndicated
or arranged by the Company or a  Subsidiary  to invest in one or more  Operating
Partnerships.

          "Tax Ruling" means a written  ruling of a  Governmental  or Regulatory
Authority relating to Taxes.

         "Tax Return" means a report, return or other information required to be
supplied  to  a  governmental  entity  with  respect  to  Taxes  including,   if
applicable,  combined or  consolidated  returns  for any group of entities  that
includes the Company.

         "Third Party Claim" shall have the meaning set forth in Section
10.03(a).

         "Transaction"  means the  acquisition  by Purchaser from Sellers of the
Midland Shares as contemplated by this Agreement.

         "Trust" means MAHGT.

         "Trust  Agreement"  means the Midland  Affordable  Housing  Group Trust
Amended and Restated  Agreement and  Declaration of Trust dated January 1, 1992,
as the same has been amended, supplemented or modified from time to time.

         "Unaudited Financial Statements" means the Financial Statements for the
most recent  fiscal  quarter of the  Company  ended June 30,  1999,  and for the
periods ended July 31, 1999, and August 31, 1999.

         "Unaudited Financial Statement Date" means June 30, 1999.

                  (b)   Unless   the  context  of  this  Agreement  otherwise
requires,  (i) words of any gender  include each other gender;  (ii) words using
the  singular  or plural  number also  include  the plural or  singular  number,
respectively;  (iii) the terms  "hereof,"  "herein,"  "hereby" and derivative or
similar  words  refer to this  entire  Agreement;  (iv) the terms  "Article"  or
"Section" refer to the specified  Article or Section of this Agreement;  and (v)
the phrases  "ordinary  course of  business"  and  "ordinary  course of business
consistent with past practice" refer to the business and practice of the Company
or a Subsidiary.  All  accounting  terms used herein and not  expressly  defined
herein shall have the meanings given to them under GAAP.

                  (c)   All  references herein to Schedules regardless of the
Section  reference  shall  mean and refer to all the  Schedules  attached  to or
forming part of the Disclosure  Schedule.  Seller will use good faith efforts to
cross-reference items which are properly discloseable on more than one Schedule.

                                   ARTICLE II
                   SALE AND CONTRIBUTION OF SHARES AND CLOSING

         2.01  Contribution,  Purchase and Sale. Sellers agree to contribute and
sell to Purchaser,  and  Purchaser  agrees to acquire and purchase from Sellers,
all of the Midland  Shares at Closing on the terms and subject to the conditions
set forth in this Agreement.

         2.02 Consideration.  The aggregate consideration for the Midland Shares
and for the  non-compete  provisions set forth in the  Employment  Agreements is
U.S.  $35,000,000 plus the right to receive,  in the future, a U.S.  $10,000,000
earn-out described in Section 2.04 below, (the "Purchase Price"), payable in the
manner  provided in Sections  2.03 and 2.04,  $90,000 of which is allocable  pro
rata to, and deemed to be in  consideration  of, the non-compete  provisions set
forth in the  Employment  Agreements and the remainder of which is allocable to,
and deemed to be in  consideration  of,  the  Midland  Shares.  A portion of the
Purchase  Price is subject to deferral  and  adjustment  as provided in Sections
2.04 and 2.05.

         2.03     Closing.

                  (a)   The  Closing  will take place at 10:00  a.m.  eastern
time on the third  Business Day  following  the date on which all  conditions to
Closing set forth in Article VIII have been  satisfied or waived,  but not later
than October 15, 1999 (the "Closing Date") at the offices of Gallagher,  Evelius
& Jones, LLP, 218 N. Charles Street, Suite 400, Baltimore,  Maryland 21201 or at
such other time and place as Purchaser and Sellers mutually agree.

                  (b)   At  the Closing,  Purchaser will pay a portion of the
Purchase Price in the following manner: (i) by wire transfer of $23,000,000 (the
"Cash  Closing  Payment") in  immediately  available  funds to such  accounts as
Sellers may reasonably direct by written notice delivered to Purchaser; and (ii)
by  issuance  to Sellers  of good and valid  title in and to the number of whole
Purchaser  Common  Shares  the  value of which  equals  or most  nearly  exceeds
$12,000,000 (the "Purchaser  Closing  Shares"),  free and clear of all Liens, by
delivering to Sellers a certificate or certificates  representing  the Purchaser
Closing  Shares,  in genuine  and  unaltered  form,  duly  endorsed  in blank or
accompanied  by duly executed  stock powers  endorsed in blank,  with  requisite
stock transfer tax stamps,  if any,  attached;  such Purchaser Closing Shares to
represent  payment of  $12,000,000  of the  Purchase  Price (the "Share  Closing
Payment," together with the Cash Closing Payment, the "Closing Payment").

                  (c)   For  purposes  of this  Agreement,  the  value of the
Purchaser Closing Shares shall equal the average of the closing prices per share
of  Purchaser  Common  Shares on the New York Stock  Exchange for the 30 trading
days prior to the date preceding Closing.

                  (d)   Simultaneously,  Sellers  will assign and transfer to
Purchaser good and valid title in and to the Midland  Shares,  free and clear of
all Liens, by delivering to Purchaser a certificate or certificates representing
the Midland  Shares,  in genuine and unaltered  form,  duly endorsed in blank or
accompanied  by duly executed  stock powers  endorsed in blank,  with  requisite
stock transfer tax stamps, if any, attached.

                  (e)   All  payments  and  transfers  of  Purchaser  Closing
Shares and Earn-out Shares to Sellers shall be made 60% to Robert J. Banks,  20%
to Keith J. Gloeckl and 20% to Ray F. Mathis.  Sellers shall  provide  Purchaser
with their  respective  wiring  instructions  at least one Business Day prior to
Closing.

                  (f)   The  partnership  interests  identified  on  Schedule
2.03(f)  shall not be deemed to be Assets or  Properties  of the  Company or its
Subsidiaries, Associates or Affiliates.

         2.04     Deferred Purchase Price.

                  (a)   Ten  Million  Dollars  ($10,000,000)  of the Purchase
Price,  as the same may be  adjusted  in  accordance  with  Section  2.04(b) and
Section 2.05 (as adjusted,  the "Deferred  Purchase  Price") shall be payable by
the  assignment  and transfer to Sellers of Purchaser  Common Shares  ("Earn-out
Shares") having a value equal to or most nearly exceeding the Deferred  Purchase
Price, as follows:  (A) 1/3 of the Deferred  Purchase Price shall be paid by the
transfer of Earn-out Shares to Sellers on December 1, 2000 if Net Income for the
period October 1, 1999 through September 30, 2000 exceeds $6,000,000; (B) 1/3 of
the Deferred  Purchase Price shall be paid by the transfer of Earn-out Shares to
Sellers  on  December  1, 2001 if Net Income  during the period  October 1, 2000
through September 30, 2001 (as increased by any Surplus) exceeds $6,250,000; and
(C) 1/3 of the Deferred  Purchase  Price shall be paid by the transfer  Earn-out
Shares to Sellers on December 1, 2002 if Net Income during the period October 1,
2001  through   September  30,  2002  (as  increased  by  any  Surplus)  exceeds
$6,500,000.

                  (b)   In the event that Net Income for any period described
in Section 2.04(a) above, as increased by any Surplus (hereinafter  defined), is
less than the relevant  target  amount for such  period,  the number of Earn-out
Shares that are  transferred  to Sellers shall be reduced such that the value of
the Earn-out  Shares  transferred  to Sellers for such period is reduced by $.50
for each $1.00 by which Net Income (as increased by any Surplus) for such period
is less than the target amount for such period.

         If Net Income for any period  exceeds the target amount for such period
(a  "Surplus"),  as  verified by Sellers or their  representatives,  the Surplus
shall be  applied  first to offset the  effect of any prior  shortfall  (thereby
resulting  in the  issuance  of  additional  Earn-out  Shares to make up for any
reduction in Earn-Out  Shares under the preceding  paragraph),  with the balance
carried forward and applied to offset a shortfall in any future period; thus, to
the extent that Net Income for a period  ("given  period"),  as increased by the
unapplied Surplus from any prior period, exceeds the target amount for the given
period,  the Earn-out  Shares for the period shall be increased by $.50 for each
$1.00 by which Net Income for the given period,  when increased by any unapplied
Surplus from any prior  period,  exceeds the target amount for the given period;
provided,  however,  that such increase shall not exceed the aggregate amount of
any prior reductions in Earn-out Shares.

         The effect of the  adjustments  provided for in this Section 2.04(b) is
illustrated in Exhibit A incorporated herein.

                  (c)   For  purposes of the  Deferred  Purchase  Price,  Net
Income shall be based upon unaudited, internally prepared consolidated financial
statements of the Company and its wholly-owned  Subsidiaries for the twelve (12)
month  period  ending  September  30 in 2000,  2001 and  2002,  which  financial
statements  shall be delivered by Purchaser to Sellers not later than October 31
in each of 2000, 2001 and 2002, together with Purchaser's good faith calculation
of Net Income for such  period,  and any  proposed  adjustments  to the Deferred
Purchase Price based thereon. If Sellers dispute any determination of Net Income
and the parties are unable to resolve the  dispute,  Net Income for the relevant
period shall be determined by  PricewaterhouseCoopers  LLP initiated through the
Tampa  Bay,  Florida  office,  or by  any  other  independent  certified  public
accountant jointly selected by Sellers and Purchaser,  whose determination shall
be conclusive  and binding on all parties for such purpose,  absent clear error.
Purchaser shall bear any costs incurred or charged by PricewaterhouseCoopers LLP
or any independent  certified public accountant  jointly selected by Sellers and
Purchaser in making such determination.

                  (d)   For  purposes of this Section 2.04,  the value of the
Earn-out  Shares  delivered on each of the dates  described  in Section  2.04(a)
shall be the average of the closing prices per share of Purchaser  Common Shares
on the New York Stock Exchange for the 30 trading days prior to such date.

                  (e)   Notwithstanding  any other  provision of this Section
2.04 to the contrary, if the value of the Earn-out Shares to be delivered on any
of the dates set forth in  Section  2.04(a) is  determined  in  accordance  with
Section  2.04(d) to be less than Fifteen Dollars  ($15.00) per share,  Purchaser
may, in its sole discretion, pay the amount of the Deferred Purchase Price which
is due and  payable on such date in cash  rather  than by  delivery  of Earn-out
Shares to Sellers.

                  (f)   Sellers shall not assign, convey, pledge or otherwise
transfer or encumber their right to Earn-Out Shares except among each other and,
for estate planning  purposes,  to their  immediate  families or trusts the sole
beneficiaries of which are their immediate  families;  and, in the case of Keith
Gloeckl,  as necessary in connection with any property settlement related to his
divorce.

         2.05  Adjustment  to Deferred  Purchase  Price.  The  maximum  Deferred
Purchase Price of $10,000,000  shall be reduced dollar for dollar by the amount,
if any,  by which  the  stockholders'  equity in the  Company  is less than $7.5
million as of the Closing  Date.  The amount of  stockholders'  equity as of the
Closing  Date  shall  be  determined  by an  audit  of the  Company's  financial
condition  as of the Closing  Date (the  "Closing  Audit").  Such audit shall be
conducted at the Purchaser's expense by PricewaterhouseCoopers LLP in accordance
with GAAP;  provided  however,  that for purposes of  determining  stockholders'
equity under this Section 2.05 and under  Section  2.06,  any loan loss reserves
shall be ignored.  Purchaser shall initiate such audit immediately after Closing
and shall use diligent  efforts to have the audit  completed as soon as possible
but in any event not later than sixty (60) days after the Closing Date.  The MMI
Interest  Strip  shall  not  be  considered  an  asset  of  the  Company  or its
Subsidiaries for purposes of the Closing Audit.

         2.06 Balance Sheet Adjustment. In the event the amount of stockholders'
equity  as  determined  in the  Closing  Audit is  greater  than  $7.5  million,
Purchaser shall pay to Sellers cash in the amount by which stockholders'  equity
in the Company as of the Closing Date exceeds $7.5  million.  Such payment shall
be made within five days after  completion  of the  Closing  Audit.  As noted in
Section  2.05,  the MMI Interest  Strip shall not be  considered an asset of the
Company or its Subsidiaries for purposes of the Closing Audit.

                                   ARTICLE III
                    REPRESENTATIONS AND WARRANTIES OF SELLERS

         Sellers,  jointly and severally,  represent and warrant to Purchaser as
follows:

         3.01 Sellers. Sellers are individuals residing in the State of Florida.

         3.02 Authority.  This Agreement has been duly and validly  executed and
delivered by the Sellers and constitutes the legal, valid and binding obligation
of Sellers  enforceable  against Sellers in accordance with its terms, except as
may  be   limited  by   applicable   bankruptcy,   insolvency,   reorganization,
recharacterization  or other similar laws affecting  creditor's rights generally
and by general  equitable  principles  (regardless  of whether  considered  in a
proceeding in equity or at law).

         3.03  Organization  of the Company.  The Company is a corporation  duly
organized,  validly existing and in good standing under the Laws of the State of
Florida,  and has full corporate  power and authority to conduct its business as
and to the  extent  now  conducted  and to own,  use and  lease its  Assets  and
Properties.  The Company is duly qualified,  licensed or admitted to do business
and is in good standing in those  jurisdictions  specified in Schedule 3.03. The
name of each  director  and officer of the Company on the date  hereof,  and the
position  with the Company held by each,  are listed in Schedule  3.03.  Sellers
have prior to the execution of this  Agreement  delivered to Purchaser  true and
complete copies of the articles of  incorporation  and by-laws of the Company as
in effect on the date hereof.

         3.04.  Capital  Stock.  The  authorized  capital  stock of the  Company
consists  solely of 10,000  shares of Common  Stock,  of which only the  Midland
Shares are issued  and  outstanding.  The  Midland  Shares are duly  authorized,
validly  issued,  outstanding,  fully paid and  nonassessable.  Sellers  own the
Midland Shares,  beneficially and of record,  subject only to those Liens listed
on Schedule 3.04. There are no outstanding  Options with respect to the Company.
At Closing,  Sellers  will deliver to Purchaser a  certificate  or  certificates
representing  the Midland Shares in the manner provided in Section 2.03 and will
transfer to Purchaser good and valid title to the Midland Shares, free and clear
of all Liens.

         3.05. Subsidiaries. Schedule 3.05 lists the name of each Subsidiary. To
the Seller's Knowledge each Subsidiary is a corporation duly organized,  validly
existing  and  in  good  standing  under  the  Laws  of  its   jurisdiction   of
incorporation  identified in Schedule  3.05,  and has full  corporate  power and
authority to conduct its business as and to the extent now conducted and to own,
use and lease its Assets and  Properties.  Each  Subsidiary  is duly  qualified,
licensed  or  admitted  to  do  business  and  is  in  good  standing  in  those
jurisdictions  specified Schedule 3.05. All of the outstanding shares of capital
stock of each Subsidiary have been duly authorized and validly issued, are fully
paid and nonassessable, and are owned, beneficially and of record by the Company
or Subsidiaries  wholly owned by the Company free and clear of all Liens.  There
are no  outstanding  Options  with respect to any  Subsidiary.  The name of each
director and officer of each  Subsidiary  on the date  hereof,  and the position
with such  Subsidiary  held by each, are listed in Schedule  3.05.  Sellers have
prior  to the  execution  of this  Agreement  delivered  to  Purchaser  true and
complete copies of the certificate or articles of incorporation  and by-laws (or
other comparable  corporate charter documents) of each of the Subsidiaries as in
effect on the date hereof.

         3.06.  No  Conflicts.  The  execution  and  delivery by Sellers of this
Agreement  does not, and the  execution and delivery by Sellers of the Operative
Agreements  to which  they are a party,  the  performance  by  Sellers  of their
obligations  under  this  Agreement  and  such  Operative   Agreements  and  the
consummation of the transactions contemplated hereby and thereby will not:

                  (a)   conflict  with or result in a  violation  or breach of
any of the terms,  conditions  or  provisions  of the certificate  or  articles
of incorporation or by-laws (or other comparable corporate charter documents) of
the  Company or any Subsidiary;

                  (b)   to the Knowledge of Sellers, subject to obtaining the
consents,  approvals  and  actions,  making the  filings  and giving the notices
disclosed in Schedule 3.06(b),  conflict with or result in a violation or breach
of any term or provision of any Law or Order applicable to Sellers,  the Company
or any Subsidiary or any of their respective Assets and Properties the breach of
which would reasonably be expected to have a Material Adverse Effect; or

                  (c)   except as disclosed in Schedule 3.06(c),  or as could
not reasonably be expected to have a Material Adverse Effect,  (i) conflict with
or result in a violation or breach of, (ii)  constitute  (with or without notice
or lapse of time or both) a default under, (iii) require Sellers, the Company or
any  Subsidiary  to obtain any  consent,  approval or action of, make any filing
with or give any  notice to any  Person as a result or under the terms of,  (iv)
result  in or  give  to any  Person  any  right  of  termination,  cancellation,
acceleration  or modification in or with respect to (v) result in or give to any
Person  any  additional   rights  or   entitlement  to  increased,   additional,
accelerated  or  guaranteed  payments  under,  or (vi) result in the creation or
imposition  of any Lien upon  Sellers,  the Company or any  Subsidiary or any of
their respective  Assets and Properties  under, any Material Contract or License
to which  Sellers,  the Company or any  Subsidiary is a party or by which any of
their respective Assets and Properties is bound or any partnership  agreement of
any Tax Credit Partnership or any Operating Partnership.

         3.07.  Governmental  Approvals  and  Filings.  Except as  disclosed  in
Schedule  3.07,  to the  Knowledge  of Sellers  after due  inquiry:  no consent,
approval or action of, filing with or notice to any  Governmental  or Regulatory
Authority on the part of Sellers,  the Company or any  Subsidiary is required in
connection with the execution, delivery and performance of this Agreement or any
of the Operative Agreements to which they are a party or the consummation of the
transactions contemplated hereby or thereby.

         3.08. Financial  Statements.  Prior to the execution of this Agreement,
Sellers have  delivered to Purchaser  true and complete  copies of the following
financial statements:

                  (a)   the  audited  balance  sheets of the  Company and its
consolidated  subsidiaries  as of  December  31,  1996,  1997 and 1998,  and the
related audited consolidated statements of operations,  stockholders' equity and
cash flows for each of the fiscal  years then  ended,  together  with a true and
correct copy of the report on such audited information by PricewaterhouseCoopers
LLP and all letters  from such  accountants  with respect to the results of such
audits; and

                  (b)   the   unaudited  balance  sheets  and  statements  of
operations  of the Company and its  consolidated  subsidiaries  as of the fiscal
quarters  ending March 31, 1999 and June 30,  1999,  and the  unaudited  balance
sheets  and  statement  of  operations  of  the  Company  and  its  consolidated
subsidiaries as of the periods ending July 31, 1999 and August 31, 1999.

Except as set forth in the notes  thereto or in Schedule  3.08,  to the Sellers'
Knowledge,  all such financial  statements were prepared in accordance with GAAP
and  fairly  present  the  consolidated   financial  condition  and  results  of
operations of the Company and its consolidated Subsidiaries as of the respective
dates thereof and for the respective  periods covered thereby,  subject,  in the
case of such Unaudited Financial Statements, to normal year-end adjustments (the
effect of which  will not,  individually  or in the  aggregate,  have a Material
Adverse Effect) and the absence of notes (that,  if presented,  would not differ
materially  from those  included in the  Audited  Financial  Statements  for the
fiscal year ended December 31, 1998).  Except for those  Subsidiaries  listed in
Schedule  3.08,  the  financial  condition  and  results of  operations  of each
Subsidiary are, and for all periods  referred to in this Section 3.08 have been,
consolidated with those of the Company.

         3.09. Absence of Changes. Except for the execution and delivery of this
Agreement and the transactions to take place pursuant hereto,  since the Audited
Financial  Statement  Date, to the Knowledge of Sellers after due inquiry of the
senior management employees of the Company listed in Schedule 3.09(a): there has
not been any  material  adverse  change,  or any  event  or  development  which,
individually or together with other such events, could reasonably be expected to
result in a Material Adverse Effect.  Without limiting the foregoing,  except as
disclosed  in  Schedule  3.09(b),  there has not  occurred  between  the Audited
Financial Statement Date and the date hereof:

                  (i)   any  declaration,  setting  aside or  payment  of any
dividend or other distribution in respect of the capital stock of the Company or
any  Subsidiary  not wholly  owned by the Company  other than cash  dividends or
distributions  to Sellers  which do not reduce  Shareholders'  Equity below $7.5
million, or any direct or indirect redemption,  purchase or other acquisition by
the Company or any  Subsidiary  of any such capital  stock of or any Option with
respect to the Company or any Subsidiary not wholly owned by the Company;

                  (ii)   any   authorization,    issuance,   sale   or   other
disposition  by the Company or any  Subsidiary of any shares of capital stock of
or Option with respect to the Company or any Subsidiary,  or any modification or
amendment of any right of any holder of any outstanding  shares of capital stock
of or Option  with  respect to the  Company or any  Subsidiary  relating to such
capital stock or Option;

                  (iii)   (x)  any increase,  outside of the ordinary course of
business  consistent  with  past  practice,   in  the  salary,  wages  or  other
compensation  of any officer or employee of the Company (other than the Sellers)
or any Subsidiary  whose annual salary is, or after giving effect to such change
would be, $100,000 or more; (y) any  establishment or  modification,  outside of
the ordinary course of business  consistent with past practice,  of (A) targets,
goals,  pools or similar  provisions  in  respect  of any fiscal  year under any
Benefit Plan, employment Contract or other employee compensation  arrangement or
(B) salary ranges,  increase  guidelines or similar provisions in respect of any
Benefit Plan, employment Contract or other employee compensation arrangement; or
(z) any adoption, entering into, amendment, modification or termination (partial
or  complete) of any Benefit  Plan except to the extent  required by  applicable
Law; provided,  however, that this paragraph shall not prohibit the Company from
awarding or paying such  bonuses as Sellers may  determine  prior to the Closing
Date as long as such bonuses are accrued  prior to Closing and  reflected in the
Closing Audit.

                  (iv)   any incurrence by the Company or any Subsidiary of
Indebtedness in an aggregate  principal  amount exceeding $100,000, other than
Indebtedness used to fund loans to Borrowers;

                  (v)   any  physical  damage,  destruction or other casualty
loss not  covered by  insurance  affecting  any of the plant,  real or  personal
property or equipment of the Company or any  Subsidiary  in an aggregate  amount
exceeding $100,000;

                  (vi)   any acquisition or disposition of, or incurrence of a
Lien (other than a Permitted  Lien) on, any Assets and Properties of the Company
or any Subsidiary, other than in the ordinary course of business consistent with
past practice;

                  (vii)   any  (x) amendment of the  certificate or articles of
incorporation or by-laws (or other comparable  corporate  charter  documents) of
the Company or any Subsidiary, (y) reorganization, liquidation or dissolution of
the Company or any Subsidiary or (z) Business Combination  involving the Company
or any Subsidiary and any other Person;

                  (viii)  any commencement or termination by the Company or any
Subsidiary of any line of business;

                  (ix)   any transaction by the Company or any Subsidiary with
Sellers,  any  officer,  director,  Affiliate  or  Associate  of  Sellers or any
Associate of any such officer,  director or Affiliate (other than the Company or
any Subsidiary) (A) outside the ordinary course of business consistent with past
practice or (B) other than on an arm's-length  basis, or (C) other than pursuant
to any Contract in effect on the Audited Financial  Statement Date and disclosed
to  Purchaser  pursuant  to Section  3.17 or (D) other than the  payment of cash
dividends; or

                  (x)   any lease of real property;

                  (xi)  any  notice by Fannie Mae or any beneficiary of MAHGT
of the termination of, or of an intent to terminate or discontinue, any business
relationship which would have a Material Adverse Affect.

         3.10.    Taxes.  Except as disclosed in Schedule 3.10 (with paragraph
references corresponding to those set forth below):

                  (a)   To  Sellers'  Knowledge:  (i)  the  Company  and  its
Subsidiaries  have timely  filed or has had filed,  after  giving  effect to any
applicable  extensions,  all Tax Returns required to be filed by applicable Law,
maintained  all  documents  and records  relating to Taxes as are required to be
made or  provided  by it and has  complied  in all  material  respects  with all
legislation  relating to Taxes  applicable  to it, and (ii) all such Tax Returns
were in all material  respects true,  complete and correct.  The Company and its
Subsidiaries have, within the time and in the manner prescribed by law, paid all
Taxes shown to be due and payable on such Tax Returns.

                  (b)   To Sellers' Knowledge, no claim has ever been made by
any authority of a jurisdiction  where the Company or its Subsidiaries  does not
file Tax Returns  that the Company or its  Subsidiaries  is or may be subject to
taxation by the jurisdiction.

                  (c)   There  are no liens for any Taxes with respect to any
Assets and Properties of the Company or its Subsidiaries except Permitted Liens.

                  (d)   The Company or its Subsidiaries have not requested any
extension  of time within  which to file any Tax Return, which Tax Return has
not since been filed.

                  (e)   The Company or its Subsidiaries have not executed any
outstanding  waivers or comparable  consents regarding the application of the
statute of limitations with respect to any Taxes or Tax Returns.

                  (f)   No deficiency for any Taxes has been proposed, asserted
or assessed against the Company or its Subsidiaries that has not been resolved
and paid in full.

                  (g)   No  audits  or other  administrative  proceedings  or
court  proceedings are presently pending with regard to any Taxes or Tax Returns
of the Company or its Subsidiaries,  and no Governmental  Authority has notified
the Company or any Subsidiary that it intends to audit its Tax affairs.

                  (h)   The  Company and its Subsidiaries have not received a
Tax Ruling or entered into a Closing  Agreement with any Governmental  Authority
that would have a Material  Adverse Effect upon the Company or its  Subsidiaries
after the date of Closing.

                  (i)   To Sellers' Knowledge, no event, transaction,  act or
omission  has  occurred  which could  result in the Company or its  Subsidiaries
becoming  liable  to pay  or to  bear  any  Tax as a  transferee,  successor  or
otherwise which is primarily or directly chargeable or attributable to any other
Person.

                  (j)   To   Seller's   Knowledge,   the   Company   and  its
Subsidiaries  have  complied  (and until the date of Closing will comply) in all
material  respects  with the  provisions of the Code relating to the payment and
withholding  of  Taxes,  including,  without  limitation,  the  withholding  and
reporting  requirements  under Code ss.ss.1441  through 1446, 3401 through 3606,
and 6041 and 6049,  as well as  similar  provisions  under any other  applicable
Laws, and has, within the time and in the manner prescribed by Law, withheld and
paid  over to the  proper  Governmental  Authorities  all  amounts  required  in
connection with amounts paid or owing to any employee.

                  (k)   The  Company or its  Subsidiaries  are not parties to
any agreement,  contract, or arrangement that would result, separately or in the
aggregate,  in the payment of any "excess parachute payments" within the meaning
of Code ss.280G.

                  (l)   The  Company and its Subsidiaries have not filed (and
will not file prior to the  Closing) a consent  pursuant  to Code  ss.341(f)  or
agreed to have Code  ss.341(f)(2)  apply to any  disposition of a subsection (f)
asset (as that term is defined in Code ss.341(f)(4)) owned by the Company or its
Subsidiaries.

                  (m)   The  Company and its Subsidiaries are not required to
include in income  any  adjustment  pursuant  to Code  ss.481(a)  by reason of a
voluntary  change  in  accounting   method  initiated  by  the  Company  or  its
Subsidiaries,  and to the knowledge of Sellers and the Company,  the IRS has not
proposed any such adjustment or change in accounting method.

                  (n)   No election under Codess.338 (or any predecessor
provisions) has been made with respect to any of the Assets and Properties of
the Company or its Subsidiaries.

                  (o)   The Company and its  Subsidiaries  are not subject to
any Tax sharing or similar  agreements under which the
Company, its Subsidiaries or the Purchaser may have liability for Taxes of any
other Person.

                  (p)   Sellers have made available to Purchaser for calendar
years 1996, 1997 and 1998 complete and accurate copies of (i) all federal income
tax  returns,  and  any  amendments  thereto,  filed  by  the  Company  and  its
Subsidiaries,  (ii) all audit reports received from any  Governmental  Authority
relating  to any  federal  income tax return  and (iii) all  Closing  Agreements
entered into by the Company or its Subsidiaries with any Governmental Authority.

         3.11.    Legal Proceedings.  Except as disclosed in Schedule 3.11 (with
 paragraph references  corresponding to those set forth below):

                  (a)   there  are no Actions or  Proceedings  pending or, to
the  Knowledge  of  Sellers,  threatened  against,  Sellers,  the Company or any
Subsidiary  or any of their  respective  Assets and  Properties  which (i) could
reasonably  be  expected  to result  in the  issuance  of an Order  restraining,
enjoining or otherwise  prohibiting or making illegal the consummation of any of
the  transactions  contemplated  by  this  Agreement  or any  of  the  Operative
Agreements  or  otherwise  result  in a  material  diminution  of  the  benefits
contemplated by this Agreement or any of the Operative  Agreements to Purchaser,
or (ii) if determined adversely to Sellers,  the Company or a Subsidiary,  could
reasonably be expected to result in (x) any injunction or other equitable relief
against the  Company or any  Subsidiary  that would  interfere  in any  material
respect  with its  business  or  operations  or (y) Losses by the Company or any
Subsidiary, individually exceeding $100,000; and

                  (b)   to the Knowledge of Sellers', there are no Orders
outstanding against the Company or any Subsidiary.

Prior to the execution of this  Agreement,  Sellers have delivered to Purchaser,
or made available to Purchaser, all responses of counsel for the Company and the
Subsidiaries to auditors' requests for information  delivered in connection with
the Audited  Financial  Statements  (together with any updates  provided by such
counsel)  regarding  Actions or  Proceedings  pending or threatened  against the
Company or any Subsidiary.

         3.12.  Compliance With Laws and Orders. Except as disclosed in Schedule
3.12, to Sellers'  Knowledge neither the Company nor any Subsidiary has received
any  written  notice  that it is in  violation  of or in default  under,  in any
material  respect,  any Law or Order applicable to the Company or any Subsidiary
or any of their  respective  Assets and  Properties the violation of which could
reasonably be expected to have a Material Adverse Effect.

         3.13.    Benefit Plans; ERISA.

                  (a)   Schedule  3.13(a)  (i)  contains a true and  complete
list and  description of each of the Benefit Plans,  (ii) identifies each of the
Benefit Plans that is a Qualified  Plan, and (iii)  identifies each of the Plans
that are fully  insured.  To  Seller's  knowledge:  neither  the Company nor any
Subsidiary  has scheduled or agreed upon future  increases of benefit levels (or
creations of new benefits)  with respect to any Plan,  and no such  increases or
creation of benefits have been proposed,  made the subject of representations to
employees or requested or demanded by employees under  circumstances  which make
it reasonable to expect that such increases will be granted.

                  (b)   Neither  the  Company  nor any ERISA  Affiliate,  or any
predecessor  thereof,  has at any time  during the five-year period preceding
the date of this Agreement, maintained or contributed to a Defined Benefit Plan.

                  (c)   Neither  the Company nor any Subsidiary  maintains or
is obligated to provide  benefits under any life,  medical or health plan (other
than as an incidental benefit under a Qualified Plan) which provides benefits to
retirees or other terminated  employees other than benefit  continuation  rights
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

                  (d)   Neither  the  Company,  any  Subsidiary,   any  ERISA
Affiliate  nor any other  corporation  or  organization  controlled  by or under
common  control with any of the  foregoing  within the meaning of Section 414 of
the Code, has at any time contributed to any  "multiemployer  plan" as that term
is defined in Section 3(37) of ERISA.

                  (e)   To Seller's Knowledge,  each of the Benefit Plans is,
and its administration is and has been since inception, in all material respects
in substantial  compliance  with, and neither the Company nor any Subsidiary has
received  any  claim or notice  that any such  Benefit  Plan is not in  material
compliance  with, all applicable  Laws and Orders,  (including all tax rules for
which favorable tax treatment is intended), without limitation, the requirements
of ERISA,  the Code,  the Age  Discrimination  in Employment  Act (to the extent
applicable),  the Equal Pay Act (to the extent  applicable) and Title VII of the
Civil Rights Act of 1964 (to the extent applicable).  To the Sellers' knowledge,
each  Qualified  Plan as of the  Closing  Date,  has met  the  requirements  for
qualification under Section 401(a) of the Code.

                  (f)   To  Seller's  Knowledge,  (i)  neither  Sellers,  the
Company nor any  Subsidiary  is in  material  default in  performing  any of its
contractual  obligations  under any of the Benefit  Plans or any  related  trust
agreement or  insurance  contract,  (ii) all  contributions  and other  payments
required to be made by Sellers,  the  Company or any  Subsidiary  to any Benefit
Plan with  respect to any  period  ending on the date  hereof  have been made or
reserves adequate for such  contributions or other payments have been or will be
set aside therefor and have been or will be reflected in Financial Statements in
accordance  with GAAP,  and (iii) there are no material  Liabilities of or under
any Benefit Plan other than  Liabilities for benefits to be paid to participants
in such Benefit Plan and their  beneficiaries  in  accordance  with the terms of
such Benefit Plan.

                  (g)   To the Sellers' Knowledge, no event has occurred, and
there exists no condition or set of circumstances in connection with any Benefit
Plan,  under which the Company,  any Subsidiary or any Plan  maintained by them,
directly or indirectly  (through any  indemnification  agreement or  otherwise),
could  reasonably  be expected  to be subject to any risk of material  liability
(including,  without limitation,  liability under Sections 406, 409 or 502(i) of
ERISA,  Title  IV of ERISA  or  Section  4975 of the  Code)  other  than to make
contributions or to pay benefits in the ordinary course.

                  (h)   To the Knowledge of Sellers,  there are no pending or
threatened  claims  (other than routine  claims for benefits) by or on behalf of
any Benefit  Plan, by any person  covered  thereby,  or otherwise,  which allege
violations of Law which would  reasonably be expected to have a Material Adverse
Effect.

                  (i)   No  employer real property or other employer property
is included in the assets of any Benefit Plan.

                  (k)   Neither the Company nor any ERISA Affiliate maintains
any severance or parachute payment plan.

                  (l)   MAHGT  is the only entity in which the  Sellers,  the
Company or its Subsidiaries participate as fiduciaries which has been created to
make  multifamily  mortgage loans.  Sellers have not received any written notice
that  the  Trust or any  other  Benefit  Plan  for  which  the  Company  and its
Subsidiaries have originated loans is subject to ERISA.

                  (m)   To  Seller's  Knowledge,  the  Trust  and  any  other
Benefit Plans for which the Company and its  Subsidiaries  have originated loans
and which are not subject to ERISA have, to the extent  managed by Sellers,  the
Company or its  Subsidiaries,  been managed in  compliance  with the  applicable
requirements  of any and all  applicable  state,  local and  foreign  laws which
govern plan fiduciaries or which are otherwise similar to ERISA.

                  (n)   Purchaser and its Affiliates,  including on and after
the Closing, the Company and any Subsidiary, shall have no liability for, under,
with respect to or otherwise in connection with any Plan, which liability arises
under  ERISA or the Code,  by  virtue of the  Company  or any  Subsidiary  being
aggregated,  at any relevant time prior to the Closing, in a controlled group or
affiliated  service  group  with any ERISA  Affiliate  that  does not  become an
affiliate of the Purchaser by virtue of the transactions contemplated hereby. No
Plan other than a Benefit Plan is or will be directly or  indirectly  binding on
Purchaser by virtue of the transactions contemplated hereby.

                  (o)   To   Seller's   Knowledge,   the   Company  and  each
Subsidiary  has  properly  classified  for  all  purposes  (including,   without
limitation,  for all Tax purposes and for purposes of determining eligibility to
participate  in any employee  benefit  plan) all  employees,  leased  employees,
consultants and independent contractors.

         3.14.    Real Property.

                  (a)   Neither  the  Company  nor any  Subsidiary  owns any
real  property.  Schedule  3.14(a)  contains a true and correct list of each
parcel of real property leased by the Company or any Subsidiary (as lessee).

                  (b)   To   the  Sellers'   Knowledge,   the  Company  or  a
Subsidiary has a valid and subsisting leasehold estate in and the right to quiet
enjoyment  of the real  properties  leased  by it for the full term of the lease
thereof.  To the Sellers'  Knowledge,  each lease  referred to in paragraph  (a)
above is a legal,  valid and binding  agreement,  enforceable in accordance with
its terms,  of the Company or a Subsidiary  and, except as set forth in Schedule
3.14(b),  and neither the Company nor any Subsidiary has received written notice
of any,  default  thereunder.  Neither the Company nor any  Subsidiary  owes any
brokerage commissions with respect to any such leased space.

                  (c)   Sellers  have  delivered  to  Purchaser  prior to the
execution of this  Agreement true and complete  copies of all leases  (including
any amendments and renewal  letters) with respect to the real property listed in
Schedule 3.14(a).

         3.15.  Tangible  Personal  Property.  The Company or a Subsidiary is in
possession  of and has good  title to, or has valid  leasehold  interests  in or
valid rights under Contract to use, all tangible  personal  property used in the
conduct of their business, including all tangible personal property reflected on
the balance sheet included in the Unaudited Financial  Statements for the period
ended on the Unaudited  Financial  Statement Date and tangible personal property
acquired  since the  Unaudited  Financial  Statement  Date other  than  property
disposed of since such date in the ordinary  course of business  consistent with
past  practice.  All such  tangible  personal  property is free and clear of all
Liens, other than Permitted Liens and Liens disclosed in Schedule 3.15.

         3.16.  Intellectual  Property Rights.  The Company and the Subsidiaries
have interests in or use the Intellectual  Property  disclosed in Schedule 3.16,
to the Sellers' Knowledge,  each of which the Company or a Subsidiary either has
all right,  title and interest in or a valid and binding  license to use. Except
as disclosed in Schedule 3.16 or in the terms of any written license  previously
delivered to or reviewed by Purchaser, to the Sellers' Knowledge,  (i) there are
no  restrictions  on the direct or  indirect  transfer  of any  license,  or any
interest  therein,  held by the  Company  or any  Subsidiary  in respect of such
Intellectual  Property,  (ii)  Sellers  have  delivered  or  made  available  to
Purchaser prior to the execution of this Agreement all material documentation in
Seller's  possession with respect to any invention,  process,  design,  computer
program  or  other  know-how  or  trade  secret  included  in such  Intellectual
Property,  (iii) neither the Company nor any Subsidiary has received any written
notice  that it is,  in  default  under  any  license  to use such  Intellectual
Property, and (iv) to the Sellers' Knowledge,  such Intellectual Property is not
being  infringed by any other Person so as to cause a Material  Adverse  Effect.
Neither Sellers, the Company nor any Subsidiary has received written notice that
the Company or any  Subsidiary is infringing  any  Intellectual  Property of any
other Person,  no written claim is pending or, to the Knowledge of Sellers,  has
been made to such effect that has not been resolved.

         3.17.    Contracts.

                  (a)   Schedule    3.17(a)   (with   paragraph    references
corresponding  to those set forth below)  contains a true and  complete  list of
each of the following  Contracts  ("Material  Contracts") or other  arrangements
(true and complete copies or, if none,  reasonably complete and accurate written
descriptions of which,  together with all amendments and supplements thereto and
all waivers of any terms  thereof,  have been  delivered to or made available to
Purchaser prior to the execution of this Agreement), to which the Company or any
Subsidiary is a party or by which any of their respective  Assets and Properties
is bound:

                     (i)  (A) all Contracts  (excluding  Benefit Plans and
"at will"  employment  agreements)  providing  for a commitment of employment or
consultation  services for a specified or unspecified  term, the name,  position
and  rate of  compensation  of each  Person  party  to such a  Contract  and the
expiration date of each such Contract;  and (B) any unwritten  promises known to
Sellers  which create an  obligation  of the Company or any  Subsidiary  to make
payments  in  any  year,   other  than  with  respect  to  salary  or  incentive
compensation payments in the ordinary course of business.

                     (ii)     all Contracts  with any Person  containing  any
provision or covenant  prohibiting  or limiting the ability of the Company or
any  Subsidiary to engage in any business  activity or compete with any Person
or prohibiting or limiting the ability of any Person to compete with the Company
or any Subsidiary;

                     (iii)    all partnership,  joint venture,  shareholders'
or other similar  Contracts with any Person (other than the partnership or
similar agreement of any Operating Partnership);

                     (iv)     all  Contracts  relating to  Indebtedness  of the
Company or any  Subsidiary  in excess of $100,000 (other than Indebtedness owing
by the Company or any wholly-owned Subsidiary used to fund loans to Borrowers);

                      (v)      all collective bargaining or similar labor
Contracts;

                     (vi)   all  Contracts   that  (A)  limit  or  contain
restrictions  on the ability of the Company or any  Subsidiary to declare or pay
dividends  on,  to make any  other  distribution  in  respect  of or to issue or
purchase,  redeem or otherwise acquire its capital stock, to incur Indebtedness,
to incur or suffer  to exist  any  Lien,  to  purchase  or sell any  Assets  and
Properties,  to change the lines of business in which it participates or engages
or to engage in any  Business  Combination  or (B)  require  the  Company or any
Subsidiary  to  maintain  specified  financial  ratios or levels of net worth or
other indicia of financial condition;

                     (vii)    all Contracts  between or among the Company or any
Subsidiary or the Trust on the one hand and any of the Sellers on the other
hand;

                     (viii)  all  other  Contracts  that (A)  involve  the
payment or potential payment,  pursuant to the terms of any such Contract, by or
to the  Company  or any  Subsidiary  of more than  $1,000,000  and (B) cannot be
terminated  within 30 calendar days after giving notice of  termination  without
resulting in any material cost or penalty to the Company or any Subsidiary; and

                     (ix)     to the extent not otherwise  covered by clauses
(i) to (viii)  above,  all written  Contracts  with Fannie Mae, HUD,  GNMA, FHLA
or MAHGT and all other  Contracts  pursuant to which the Company or any
Subsidiary  originates,  sells or services mortgage loans.

                  (b)   Each  Material  Contract  required to be disclosed in
Schedule 3.17(a) is in full force and effect and constitutes a legal,  valid and
binding agreement, enforceable against the Company or a Subsidiary to the extent
a party  thereto  in  accordance  with its  terms,  except as may be  limited by
applicable bankruptcy, insolvency,  reorganization,  recharacterization or other
similar laws  affecting  creditor's  rights  generally and by general  equitable
principles  (regardless  of whether  considered  in a proceeding in equity or at
law);  and except as disclosed in Schedule  3.17(b)  neither the Company nor any
Subsidiary has received  written notice (i) that it is in violation or breach of
or default under any such Material  Contract (or with notice or lapse of time or
both,  would be in  violation  or breach of or default  under any such  Material
Contract),  or (ii) that any other party to a Material Contract claims that such
Contract is not its legal,  valid and  binding  obligation  or is  unenforceable
against such other party.

         3.18. Licenses.  Schedule 3.18 contains a true and complete list of all
Licenses  used in and material to the business or  operations  of the Company or
any Subsidiary. Prior to the execution of this Agreement, Sellers have delivered
to or made available to Purchaser  true and complete  copies of all such written
Licenses. Except as disclosed in Schedule 3.18:

                  (i)   to the Sellers'  Knowledge,  each License  listed in
Schedule  3.18 is valid,  binding and in full force and effect;

                  (ii)  to the  Seller's  Knowledge,  the Company and each
Subsidiary  hold all Licenses the absence of which would have a Material Adverse
Effect; and

                  (iii) neither the Company nor any  Subsidiary  is, or has
received any written notice that it is, in default under any such License.

         3.19. Insurance. Schedule 3.19 contains a true and complete list of all
liability,  property, workers' compensation,  directors' and officers' liability
and other  insurance  policies  currently  in effect that  insure the  business,
operations or employees of the Company or any Subsidiary. The insurance coverage
provided by the  policies  described  in clause (i) above will not  terminate or
lapse by reason of the transactions contemplated by this Agreement.  Neither the
Company nor any Subsidiary has received notice that any insurer under any policy
referred  to in this  Section  is  denying  liability  with  respect  to a claim
thereunder or defending under a reservation of rights clause.

         3.20.    Employees; Labor Relations.

                  (a)   Schedule  3.20  contains  a list of the  name of each
officer and full-time  employee of the Company and the  Subsidiaries at the date
hereof,  together  with each such  person's  position or  function,  annual base
salary or wages and any  incentive  or bonus  arrangement  with  respect to such
person in effect on such date.

                  (b)   (i)  To the  Sellers'  Knowledge,  no employee of the
Company or any Subsidiary is presently a member of a collective  bargaining unit
and,  to the  Knowledge  of Sellers,  there are no  threatened  or  contemplated
attempts to organize for collective  bargaining purposes any of the employees of
the Company or any Subsidiary; and (ii) except as set forth in Schedule 3.20(b),
no unfair labor practice complaint or sex or age discrimination claim is pending
against  the  Company  or any of the  Subsidiaries  before  the  National  Labor
Relations Board or any other Governmental or Regulatory  Authority.  There never
has been any  work  stoppage  or  strike  by  employees  of the  Company  or any
Subsidiary.  Since January 1, 1997,  the Company and the  Subsidiaries  have not
received any written notice of  noncompliance  with  applicable Laws relating to
the employment of labor,  including without  limitation those relating to wages,
hours and collective bargaining.

                  (c)   Except for employees who are parties to employment
Contracts listed on Schedule  3.17(a),  all employees of the Company and its
Subsidiaries are "at-will" employees.

         3.21.    Substantial Business Relationships.

                  (a)   Schedule  3.21(a) lists the largest  investors in tax
credit  funds  and  projects  sponsored  or  arranged  by the  Company  and  its
Subsidiaries. Except as disclosed in Schedule 3.21(a), to Sellers' Knowledge: no
such investor has ceased or materially  reduced its  relationship  or investment
with the Company and the  Subsidiaries  since the  Audited  Financial  Statement
Date,  or to the  Knowledge of Sellers,  has  threatened  to cease or materially
reduce its  relationship,  or such investment with the Company or any Subsidiary
after the date hereof.

                  (b)   Schedule  3.21(b) lists all Persons for whose benefit
or at whose  request the Company or its  Subsidiaries  have made loans which are
presently  outstanding  or  have  arranged  tax  credit  investments  which  are
presently  outstanding  which in the  aggregate  exceed  $10,000,000.  Except as
disclosed in Schedule  3.21(b),  to the Knowledge of Sellers,  no such Person is
threatened with bankruptcy or insolvency.

                  (c)   To  the Knowledge of Sellers after due inquiry of the
senior  management  employees  of the  Company  and its  Subsidiaries  listed on
Schedule  3.21(c),  the Company and its  Subsidiaries  are in  compliance in all
material respects with all agreements with any of Fannie Mae, GNMA, HUD or FHLA,
and neither the Sellers,  the Company nor any  Subsidiary  has received  written
notice of any material noncompliance with the handbooks,  manuals and guidelines
applicable  to  FannieMae  DUS  lenders  or  seller/servicers,  GNMA  lenders or
seller/services,   HUD   lenders  or   seller/servicers   or  FHLA   lenders  or
seller/servicers.

                  (d)   Neither  Sellers, the Company, nor any Subsidiary has
received any written notice from Fannie Mae,  GNMA,  HUD or FHLA,  respectively,
stating or indicating that the Company or any Subsidiary was or is in default in
its   obligations  to  or  agreements  with  Fannie  Mae,  GNMA,  HUD  or  FHLA,
respectively;  and Sellers  have no Knowledge of any facts or events which would
entitle or give Fannie Mae, GNMA, HUD or FHLA,  respectively  cause to terminate
MMI as an approved DUS lender or GNMA, HUD or FHLA lender, respectively.

                  (e)   Except as listed on Schedule 3.21(e),  Fannie Mae has
not sent the Company or any  Subsidiary  notice of any default or  deficiency in
MMI's performance as a DUS lender or Fannie Mae approved seller/servicer. Except
as listed on Schedule  3.21(e),  neither GNMA, HUD nor FHLA has sent the Company
or any Subsidiary  notice of any default or deficiency in MMI's performance as a
lender  or  seller/servicer.   To  Seller's  knowledge,   the  Company  and  its
Subsidiaries  are in full  compliance  with all net  worth,  reserve,  and other
financial conditions required by FannieMae..

                  (f)   Neither  Sellers, the Company, nor any Subsidiary has
received any written notice from any  beneficiary of MAHGT asserting or claiming
any of the following on the part of the Sellers,  the Company or any Subsidiary:
(i) breach of any Contract with, or duty of care owed to, MAHGT, or (ii) failure
to comply in any material respect with any agreement entered into with MAHGT.

                  (g)   Neither  Sellers,  the Company nor any Subsidiary has
received notice from any beneficiary of MAHGT that such  beneficiary  intends to
withdraw from the Trust.

         3.22.  No Powers of  Attorney.  Except as set forth in  Schedule  3.22,
neither the Company nor any  Subsidiary has any powers of attorney or comparable
delegations of authority outstanding.

         3.23  Assets.  Neither  Sellers,  the  Company nor any  Subsidiary  has
received  written notice that the Company or any Subsidiary or any  counterparty
is in violation  of or in default  under,  in any material  respect any material
loan or credit agreement, note, bond, mortgage, indenture or any material lease,
permit,  concession,  franchise or license, or any material agreement to acquire
real property, or any other material Contract to which it is a party or by which
it or any of its  properties  or assets  is  bound,  except  for  violations  or
defaults that would not, individually  reasonably be expected to have a Material
Adverse Effect.

         3.24.  Brokers.  Except for FPL  Associates  Finance L.P.,  whose fees,
commissions  and  expenses  are  the  sole   responsibility   of  Sellers,   all
negotiations relative to this Agreement and the transactions contemplated hereby
have  been  carried  out  by  Sellers   directly  with  Purchaser   without  the
intervention  of any Person on behalf of Sellers in such  manner as to give rise
to  any  valid  claim  by any  Person  against  Purchaser,  the  Company  or any
Subsidiary for a finder's fee, brokerage commission or similar payment.

         3.25.  Year 2000  Compliance.  The  Company and its  Subsidiaries  have
reviewed  and  tested  all  computer  hardware  and  software  applications  and
date-sensitive  equipment  controlled  by  imbedded  computer  chips in order to
determine  whether  such  systems  are year  2000  compliant  to the  extent  of
technological resources currently available to the Company and its Subsidiaries.
To the best of  Sellers'  Knowledge  the  systems  used by the  Company  and its
Subsidiaries  will be year 2000  compliant by December 31, 1999. For purposes of
this Section,  year 2000 compliant means all hardware and software  applications
and  date-sensitive   equipment   controlled  by  imbedded  computer  chips  can
accurately  process  date  and  time  data  (including,   but  not  limited  to,
calculating, comparing and sequencing) from, into, and between the twentieth and
twenty-first centuries, and the years 1999 and 2000, including correct leap year
calculations. Furthermore, year 2000 compliant systems, when used in combination
with all other information systems,  shall accurately process date and time data
if the other systems properly exchange date and time data with it.

         3.26.    Status of Outstanding Loans.

                  (a)   Schedule  3.26(a) is a complete  list as of September
1,  1999  of  all  permanent   loans  being  serviced  by  the  Company  or  its
Subsidiaries,  and indicates for each such loan the name of the party which owns
such loan (or a participation interest therein).

                  (b)   Schedule  3.26(b) is a complete  list as of September
1, 1999 of all outstanding construction loans which have been closed (i.e., loan
documents  have been executed and a mortgage or deed of trust has been recorded)
by the  Company  or its  Subsidiaries,  and  indicates  in each  case the  party
providing the funds from which such loan was funded.

                  (c)   Schedule   3.26(c)   is  a   complete   list  of  all
outstanding commitments for construction loans as of September 1, 1999 issued by
the Company or its Subsidiaries,  and indicates in each case the party from whom
the funds will be obtained to fund such loan.

                  (d)   Schedule   3.26(d)   is  a   complete   list  of  all
outstanding  commitments  for permanent  loans as of September 1, 1999 issued by
the  Company  or its  Subsidiaries,  (whether  in its own behalf or on behalf of
another party, such as MAHGT) and indicates in each case the proposed  permanent
lender and the  intended  disposition  of such loan  (e.g.,  sale to Fannie Mae,
etc.).

                  (e)   Schedule  3.26(e)  is a  complete  list of all  loans
originated or serviced by the Company or its Subsidiaries which is currently (as
of  September 1, 1999)  identified  as a  non-performing,  "watch list" or other
similarly classified loan.

                  (f)   Schedule  3.26(f) is a complete list of all permanent
loans  owned or  serviced  by the  Company  or its  Subsidiaries  for  which the
underlying  borrower or project has a debt service  coverage  ratio of less than
1.10 to 1.0,  based upon the most recent  financial  reporting  available to the
Company or its Subsidiaries as of September 1, 1999.

                  (g)   Schedule  3.26(g)  is a  complete  list of all  loans
owned or  serviced  by the Company or its  Subsidiaries  for which,  in Sellers'
reasonable and good faith judgment,  based on information currently available to
Sellers,  the Company or its Subsidiaries may be required to make delinquency or
servicing  advances  during the next 12  months,  or which may be unable to meet
scheduled debt service requirements during such period.

                  (h)   Schedule  3.26(h) lists all construction  loans owned
or  serviced  by the  Company or its  Subsidiaries  for which the Sellers or the
Company  has reason to believe  that the  remaining  loan  proceeds  will not be
sufficient  to complete  the  construction  of the project free and clear of all
liens, claims and encumbrances.

                  (i)   Except as disclosed in Schedule 3.26(i),  the Company
or the applicable  Subsidiary  received a lender's  policy of title insurance in
connection with all loans made by the Company and its  Subsidiaries  and secured
by real property and each owner of a low income housing tax credit  property for
which the Company or any  Subsidiary  arranged the tax credit equity  investment
received an owner's  policy of title  insurance,  in an amount not less than the
loan amount or the total amount invested in the property respectively.

         3.27.    Status of Tax Credit Transactions.

                  (a)   Except as disclosed on Schedule 3.27(a), the Sellers,
the  Company  and  its   Subsidiaries   have  received  no  written  notices  or
communications (from the IRS, any state housing finance authority,  or any other
party) to the effect (i) that any Affiliate of the Sellers or the Company, is in
default under the organizational  documents of any Tax Credit Partnership or any
Operating  Partnership  in any  material  respect;  or (ii)  that any  event has
occurred which would cause any Operating  Partnership or Tax Credit  Partnership
not to realize its reasonably anticipated tax credits.

                  (b)   Except as disclosed in Schedule 3.27(b),  to Sellers'
Knowledge, each property with respect to which the Company or any Subsidiary has
made a loan or arranged a tax credit equity investment is in compliance with all
income  requirements and rent limitations imposed on such property or the owners
thereof by any agreement, restrictive covenant or applicable Law in all material
respects.

                  (c)   Attached  as Schedule  3.27(c),  is a  comparison  of
original  projected  benefits with current projected benefits for cash investors
in Midland Corporate Tax Credit Partnerships I - IV. No investor in a Tax Credit
Partnership has notified the Company or its Subsidiaries that it is dissatisfied
with its actual or projected returns.

         3.28.  No  Undisclosed  Liabilities.  Except as  reflected  or reserved
against in the balance sheet included in the Audited Financial  Statements or in
the notes thereto or as disclosed in Schedule 3.28,  there are, to the Knowledge
of Sellers after due inquiry of senior management  employees of the Company,  no
Liabilities  against,  relating to or affecting the Company or any Subsidiary or
any of their respective Assets and Properties,  other than Liabilities which are
incurred in the ordinary  course of business  consistent  with past practice and
which  in the  aggregate  would  not  have a  Material  Adverse  Effect.  To the
Knowledge  of Sellers,  all facts  material to the  Business or Condition of the
Company  and its  Subsidiaries  have  been  disclosed  to  Purchaser  in,  or in
connection with, this Agreement and the Schedules.

         3.29. Affiliate Transactions.  Except as disclosed Schedule 3.29, as of
the date of this Agreement,  there are no intercompany  Liabilities  between the
Company or any Subsidiary or the Trust, on the one hand, and any of the Sellers,
on the other, which would survive Closing.

         3.30.  Books and  Records.  The  minute  books,  contracts,  documents,
instruments and similar records of the Company and the  Subsidiaries  which have
been made available to Purchaser are genuine and are true, complete and accurate
copies of the Company's records.

         3.31.  Qualification to do Business.  Except as shown on Schedule 3.31,
neither the Company nor any  Subsidiary  has  received  written  notice from any
state that the  Company or any  Subsidiary  is subject to any fine,  forfeiture,
diminution of rights or similar penalty for failure to qualify to do business in
such state.

         3.32. Environmental Matters. Except as shown on Schedule 3.32 or on any
Phase I environmental  report received by the Company or any Subsidiary and made
available to Purchaser, neither the Sellers, the Company, nor any Subsidiary has
received  written  notice that any  property  with respect to which the Company,
MAGHT or any  Subsidiary  has made a loan or arranged a  low-income  housing tax
credit investment is in violation of any Environmental Law.

         3.33.    Watch List.  Schedule 3.33 is a true and correct copy of the
Company's  "watch" list of Operating  Partnerships  and Borrower loans as of
August 31, 1999.

         EXCEPT AS SPECIFICALLY SET FORTH HEREIN, ALL OTHER  REPRESENTATIONS AND
WARRANTIES, EXPRESSED OR IMPLIED, ARE HEREBY WAIVED AND DISCLAIMED.

                                   ARTICLE IV
                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

         Purchaser hereby represents and warrants to Sellers as follows:

         4.01.  Organization.  Purchaser  is a limited  liability  company  duly
organized,  validly existing and in good standing under the Laws of the State of
Delaware.  Purchaser has full limited  liability  company power and authority to
execute and deliver this Agreement and the Operative Agreements to which it is a
party, to perform its obligations hereunder and thereunder and to consummate the
transactions  contemplated  hereby and  thereby.  Purchaser  is duly  qualified,
licensed or admitted to do business and is in good standing in all jurisdictions
in which the  ownership,  use or leasing of its  Assets and  Properties,  or the
conduct  or nature of its  business,  makes  such  qualification,  licensing  or
admission  necessary  and in which the failure to be so  qualified,  licensed or
admitted and in good  standing  could  reasonably be expected to have an adverse
effect  on the  validity  or  enforceability  of  this  Agreement  or any of the
Operative  Agreements  to which it is a party or on the ability of  Purchaser to
perform its obligations hereunder or thereunder.

         4.02.  Authority.  The  execution  and  delivery by  Purchaser  of this
Agreement  and  the  Operative  Agreements  to  which  it is a  party,  and  the
performance by Purchaser of its obligations hereunder and thereunder,  have been
duly and validly  authorized  by the Board of Directors of  Purchaser,  no other
limited  liability  company action on the part of Purchaser or its  stockholders
being necessary  other than approval prior to Closing by Purchaser's  Investment
Committee of any changes in this Agreement and the Operative Agreements from the
drafts presented to the Board at its September 22, 1999 meeting.  This Agreement
has been duly and validly  executed and delivered by Purchaser and  constitutes,
and upon the execution and delivery by Purchaser of the Operative  Agreements to
which it is a party, such Operative Agreements will constitute, legal, valid and
binding  obligations of Purchaser  enforceable  against  Purchaser in accordance
with their respective  terms,  subject only to ratification  prior to Closing by
Purchaser's Investment Committee.

         4.03.  Issuance of Purchaser  Common Shares The Purchaser Common Shares
to be issued to Sellers by Purchaser  pursuant to this  Agreement have been duly
authorized   and  will  upon  issuance  be  validly   issued,   fully  paid  and
nonassessable  and will not be  subject  to any  preemptive  rights  created  by
statute, Purchaser's Amended and Restated Certificate of Formation and Operating
Agreement,  by-laws, or other equivalent  organizational  documents or any other
agreement.  The  Purchaser  Common  Shares  issued to Sellers  pursuant  to this
Agreement shall be free of any Liens or other defects in title.

         4.04.  No  Conflicts.  The  execution and delivery by Purchaser of this
Agreement do not, and the  execution  and delivery by Purchaser of the Operative
Agreements  to  which  it is a  party,  the  performance  by  Purchaser  of  its
obligations  under  this  Agreement  and  such  Operative   Agreements  and  the
consummation of the transactions contemplated hereby and thereby will not:

                  (a)   conflict  with or result in a violation  or breach of
any  of  the  terms,  conditions  or  provisions  of the  Amended  and  Restated
Certificate of Formation and Operating Agreement or by-laws of Purchaser;

                  (b)   subject  to obtaining  the  consents,  approvals  and
actions,  making the filings and giving the notices  disclosed in Schedule  4.05
hereto,  conflict  with or  result  in a  violation  or  breach  of any  term or
provision of any Law or Order  applicable  to Purchaser or any of its Assets and
Properties; or

                  (c)   except  as  disclosed in Schedule  4.04  hereto,  (i)
conflict  with or result in a violation or breach of, (ii)  constitute  (with or
without  notice  or  lapse  of time or  both) a  default  under,  (iii)  require
Purchaser to obtain any consent,  approval or action of, make any filing with or
give any notice to any Person as a result or under the terms of, or (iv)  result
in the creation or  imposition  of any Lien upon  Purchaser or any of its Assets
and Properties  under,  any Contract or License to which Purchaser is a party or
by which any of its Assets and Properties is bound.

         4.05.  Governmental  Approvals  and  Filings.  Except as  disclosed  in
Schedule 4.05 hereto,  no consent,  approval or action of, filing with or notice
to any Governmental or Regulatory Authority on the part of Purchaser is required
in connection with the execution,  delivery and performance of this Agreement or
the  Operative  Agreements  to which it is a party  or the  consummation  of the
transactions contemplated hereby or thereby.

         4.06. Legal  Proceedings.  There are no Actions or Proceedings  pending
or, to the knowledge of Purchaser,  threatened against, relating to or affecting
Purchaser or any of its Assets and Properties which could reasonably be expected
to  result in the  issuance  of an Order  restraining,  enjoining  or  otherwise
prohibiting  or  making  illegal  the  consummation  of any of the  transactions
contemplated by this Agreement or any of the Operative Agreements.

         4.07. Purchase for Investment. The Shares will be acquired by Purchaser
(or, if  applicable,  its  assignee  pursuant to Section  11.10(b))  for its own
account for the purpose of  investment,  it being  understood  that the right to
dispose of such  Midland  Shares  shall be  entirely  within the  discretion  of
Purchaser (or such assignee,  as the case may be).  Purchaser (or such assignee,
as the case may be) will refrain from transferring or otherwise disposing of any
of the Shares, or any interest therein, in such manner as to cause Sellers to be
in violation of the registration  requirements of the Securities Act of 1933, as
amended, or applicable state securities or blue sky laws.

         4.08.  Brokers.  Except for Robert A. Stanger & Co., Inc.,  whose fees,
commissions  and  expenses  are  the  sole  responsibility  of  Purchaser,   all
negotiations relative to this Agreement and the transactions contemplated hereby
have  been  carried  out  by  Purchaser   directly  with  Sellers   without  the
intervention of any Person on behalf of Purchaser in such manner as to give rise
to any valid claim by any Person against Sellers,  the Company or any Subsidiary
for a finder's fee, brokerage commission or similar payment.

         4.09  Disclosure.   Purchaser  has  kept  current  public   information
available  within  the  meaning  of Rule  144(c)  of the  regulations  under the
Securities Act.  Purchaser has prior to the date hereof,  and will file with the
Securities  and Exchange  Commission  ("SEC") in a timely manner all reports and
other documents and  information  required of the Purchaser under the Securities
Exchange  Act of 1934,  as amended,  and is eligible to register  the  Purchaser
Common  Shares on Form S-3. All filings  made by Purchaser  with the SEC and all
press releases  issued by the Purchaser  were true,  correct and complete in all
material respects when filed or released, and, except as disclosed in subsequent
filings with the SEC, since the date of each such filing or press release, there
has been no material adverse change in any of the information contained therein.

         4.10  Financial   Statements.   Each  of  the  consolidated   financial
statements (including,  in each case, any notes and schedules thereto) contained
in the Purchaser's SEC filing complies as to form with the applicable accounting
requirements and rules and regulations of the SEC and was prepared in accordance
with GAAP (except as may be indicated in the notes thereto),  and each presented
the  consolidated  financial  position,  results of operations and cash flows of
Purchaser and the  consolidated  subsidiaries  of Purchaser as at the respective
dates  thereof  and for the  respective  periods  indicated  therein,  except as
otherwise noted therein (subject, in the case of unaudited statements, to normal
and recurring year end adjustments which were not, and are not expected to have,
a material adverse effect on the business, operations, results of operations, or
the condition (financial or otherwise) of Purchaser and its subsidiaries,  taken
as a whole.)

         4.11 Organizational Documents.  Purchaser has heretofore made available
to the  Sellers  complete  and  correct  copies  of  its  Amended  and  Restated
Certificate  of  Formation  and  Operating   Agreement,   Bylaws  or  equivalent
organization  documents,  each as  amended  as of the  date  hereof.  Each  such
organizational  document  is in  full  force  and  effect.  Purchaser  is not in
violation  in any  material  respect  of any  provision  of its  Certificate  of
Formation and Operating  Agreement,  Bylaws, or other equivalent  organizational
documents.

         4.12 SEC Filings.  Purchaser  has  heretofore  made  available to the
Sellers  complete and correct copies of (i) all agreements,  documents and other
instruments  not yet filed by Purchaser  with the SEC but that are  currently in
effect  and that  Purchaser  expects to file with the SEC after the date of this
Agreement, and (ii) all amendments and modifications that have not been filed by
Purchaser with the SEC to all agreements,  documents and other  instruments that
previously had been filed with the SEC and are currently in effect.

         4.13 Tax  Matters.  Purchaser  is and always has been  classified  as a
partnership for Federal income tax purposes.  Accordingly,  Purchaser is not and
never has been liable for Federal income tax.  Purchaser has timely filed (after
giving effect to any applicable extensions) all Tax Returns required to be filed
by  Purchaser  under  applicable  law in a manner  which is true,  complete  and
correct in all material  respects and has,  within the time  prescribed  by law,
paid all other Taxes (i.e., all Taxes other than Federal income tax) shown to be
due and payable on such Tax Returns. Historically,  Purchaser has made quarterly
distributions to the holders of its common shares in an aggregate amount no less
than the taxable  income of  Purchaser  allocable  to such holders for any given
year  multiplied  by the  highest  rate of  Federal  income  tax  applicable  to
individuals  for such prior year,  and Purchaser has no current  intent to alter
its historical distribution  practices.  Purchaser makes no assurance whatsoever
as to its future tax status or distribution practices.

         4.14  Knowledge.  Purchaser  does not have any actual  knowledge of any
facts or circumstances that would make any of the  representations or warranties
of Sellers in this Agreement untrue or misleading.

         4.15     Purchaser's Expertise and Investigation.

                  (a)   Purchaser is an informed and sophisticated purchaser,
possesses such  knowledge and experience in financial and business  matters that
it is capable of evaluating  the merits and risks of its  investment  under this
Agreement  and has engaged  expert  legal,  financial,  tax,  business and other
advisors,  experienced  in the  evaluation and purchase of companies such as the
Company.

                  (b)   Purchaser  has undertaken  such  investigation  as it
deems  necessary or appropriate to enable it to make an informed and intelligent
decision with regard to this Agreement and the transactions contemplated by this
Agreement.

                  (c)   Purchaser  acknowledges  and agrees  that,  in entering
this  Agreement  and  acquiring  the Company and in consummating the other
transactions contemplated by this Agreement:

                           (i)  Purchaser  has relied and will rely  solely upon
         its own investigation and analysis,  the representations and warranties
         contained in Article III of this  Agreement,  and the  genuineness  and
         completeness of all records of the Company and its  Subsidiaries  which
         have been furnished to Purchaser for its review (and,  without limiting
         the  generality of the  foregoing,  not on any  information  learned or
         provided in connection  with any  presentation  made by Sellers,  their
         investment bankers or other non-employee representatives of the Company
         or the Subsidiaries.)

                           (ii)  Neither  the  Sellers,   the  Company  nor  the
         Subsidiaries  (nor  their  investment  bankers  or any of  their  other
         representatives)  has made any  representation  or  warranty  except as
         expressly set forth in Article III of this Agreement.

                           (iii)  None  of  the  Sellers,  the  Company  or  the
         Subsidiaries  (nor  their  investment  bankers  or any of  their  other
         representatives)  will have any  liability to Purchaser  (or any of its
         other  Representatives)  on any basis based upon any  information  made
         available or statements  made except for those  expressly  contained in
         Article  III of  this  Agreement  and  only  in  accordance  with  this
         Agreement.

                           (iv) On or prior to the date of this Agreement and on
         or prior to the Closing Date,  Purchaser and its  Representatives  have
         had full access to, and have been  furnished with all  information  and
         documentation  regarding,  the  Company  and  the  Subsidiaries,  their
         respective businesses,  their respective prospects, the Midland Shares,
         this Agreement and the  transactions  contemplated  by this  Agreement,
         including all of the facilities,  assets,  properties,  books,  leases,
         agreements,  commitments,  Contracts,  records  and  personnel  of  the
         Company and the Subsidiaries, including all information which Purchaser
         considers  necessary  or  advisable  to  enable  it to make a  decision
         concerning its purchase of the Midland Shares and all other information
         as  Purchaser  has  requested,   so  that  Purchaser  has  had  a  full
         opportunity  to review the business,  financial,  accounting  and legal
         matters relating to all of the foregoing.

         4.16 MESC Notice.  At least two business days prior to the date of this
Agreement,  Purchaser  has received a true and  complete  copy of MESC Form 1027
entitled  "Business   Transferors  Notice  to  Transferee  of  Unemployment  Tax
Liability and Rate" in accordance with the provisions of applicable law.

                                    ARTICLE V
                              COVENANTS OF SELLERS

         Sellers, jointly and severally, covenant and agree with Purchaser that,
at all times from and after the date hereof, for the period specified herein or,
if no period is  specified  herein,  indefinitely,  Sellers will comply with all
covenants and  provisions of this Article V, except to the extent  Purchaser may
otherwise give its prior consent in writing.

         5.01. Regulatory and Other Approvals.  Sellers will, and will cause the
Company and the  Subsidiaries to, (a) use commercially  reasonable  efforts,  as
promptly as practicable to obtain all consents, approvals or actions of, to make
all  filings  with  and to  give  all  notices  to  Governmental  or  Regulatory
Authorities  or any  other  Person  required  of  Sellers,  the  Company  or any
Subsidiary  to  consummate  the  transactions  contemplated  hereby,  including,
without limitation,  those described in Schedules 3.06 or 3.07, (b) provide such
other  information  and   communications  to  such  Governmental  or  Regulatory
Authorities  or other  Persons as Purchaser or such  Governmental  or Regulatory
Authorities  or other  Persons may  reasonably  request and (c)  cooperate  with
Purchaser as promptly as  practicable  in obtaining all  consents,  approvals or
actions of,  making all filings with and giving all notices to  Governmental  or
Regulatory  Authorities or other Persons required of Purchaser to consummate the
transactions  contemplated  hereby.  Sellers will provide prompt notification to
Purchaser when any such consent,  approval, action, filing or notice referred to
in clause (a) above is obtained,  taken, made or given, as applicable,  and will
advise Purchaser of any  communications  (and,  unless precluded by Law, provide
copies of any such  communications that are in writing) with any Governmental or
Regulatory   Authority  or  other  Person  regarding  any  of  the  transactions
contemplated by this Agreement or any of the Operative Agreements.

         5.02.  Books and  Records.  At Closing,  Sellers  will  deliver or make
available to Purchaser at the offices of the Company and the Subsidiaries all of
the Books and Records,  and if at any time after the Closing Sellers discover in
their  possession or under their control any other Books and Records,  they will
forthwith deliver such Books and Records to Purchaser.

         5.03.  Notice and Cure.  Sellers  will  notify  Purchaser  promptly  in
writing of, and contemporaneously  will provide Purchaser with true and complete
copies  of any and all  information  or  documents  relating  to,  and  will use
commercially reasonable efforts to cure, any event,  transaction or circumstance
occurring  after  the date of this  Agreement  that  causes  or will  cause  any
covenant or  agreement  of Sellers  under this  Agreement to be breached or that
renders  or will  render  untrue  any  representation  or  warranty  of  Sellers
contained  in this  Agreement  as if the same  were made on or as of the date of
such event, transaction or circumstance.

         5.04. Continued Access. Between the date of this Agreement and the date
of Closing,  Sellers will afford Purchaser and its advisors reasonable access to
the personnel, properties, Contracts, Books and Records, and other documents and
data of the Company and its  Subsidiaries.  ...Any such access will be provided,
and all such  inspections  will be conducted,  at reasonable times and in such a
manner  as  not  to  interfere  with  the  operations  of  the  Company  or  the
Subsidiaries.

         5.05.  Operation of the Business Prior to Closing.  Between the date of
this Agreement and the date of Closing, Sellers will, and will cause the Company
and  each  Subsidiary  to (a)  conduct  the  business  of the  Company  and each
Subsidiary in the ordinary  course of business,  (b) use  reasonable  efforts to
preserve  intact  the  current  business  organization  of the  Company  and its
Subsidiaries,  keep available the services of the current officers and employees
of the Company and its Subsidiaries,  and maintain the contractual relations and
good will of the Company and its Subsidiaries with MAHGT, Fannie Mae, GNMA, HUD,
FHLA, tax credit investors,  borrowers,  landlords,  creditors and others having
business  relationships  with  the  Company  and its  Subsidiaries,  and (c) not
undertake any matters outside the ordinary course of business  without the prior
written consent of Purchaser which consent shall not be unreasonably withheld or
delayed  and if not  withheld  or given  within  seven  days of  notice  of such
undertaking  shall be  deemed  given.  An  action  shall be  deemed to be in the
ordinary course of business only if it is consistent with past practice.

         5.06.  Disclosure;  Shopping.  Sellers shall not make any disclosure of
the  existence  or  terms  of this  Agreement  without  the  prior  approval  of
Purchaser. Sellers will not, and shall cause the Company and each Subsidiary not
to,  directly or  indirectly  solicit,  initiate,  or encourage any inquiries or
proposals  from,  or discuss or  negotiate  with,  any  Person  relating  to any
transaction  involving  the sale of the business or Assets or  Properties of the
Company or any Subsidiary or the capital stock of the Company or any Subsidiary.

         5.07     Tax Credit Entities; Ownership and Control.

                  (a)   Sellers agree that they will take no steps to remove,
and will vote their  ownership  interests  (in  whatever  form) to  prevent  the
removal of, Midland Equity  Corporation (or any other Subsidiary of the Company)
as general  partner  (or as general  partner  of a general  partner)  of any Tax
Credit Partnership or of any Operating Partnership in which it serves as general
partner,  unless Midland  Equity  Corporation  (or such other  Subsidiary of the
Company)  defaults in its obligations under the relevant  partnership  agreement
and none of the  Sellers  is on the Board of  Directors  of, or is an officer or
employee of, such defaulting entity.

                  (b)   The provisions of this Section 5.07 shall survive
Closing for as long as any Seller is an employee,  officer or director of
Purchaser or any of its Subsidiaries.

         5.08     Updating of Schedules.

                  (a)   Between  the date of this  Agreement and the Business
Day  immediately  preceding  the Closing  Date,  Sellers  will from time to time
deliver to Purchaser  updated  Disclosure  Schedules  showing any changed facts,
circumstances  or  information  from the  matters  disclosed  in the  Disclosure
Schedules to this Agreement necessary to make the representations and warranties
set forth in Article III above true and  complete  (irrespective  of whether any
particular section of this Agreement calls for a Schedule to such section) which
shall be deemed an amendment to this Agreement.

                  (b)   If  the  information   contained  in  any  Disclosure
Schedules or updates  thereto  delivered  between the date of this Agreement and
the Closing Date, or if the underlying  documents  referenced therein or related
thereto, could, in Purchaser's sole discretion,  have a Material Adverse Effect,
Purchaser shall have the option,  as its sole and exclusive remedy, to terminate
this Agreement by written notice to Sellers  delivered  within five (5) Business
Days of Purchaser's  receipt of such information,  and no party shall thereafter
have any liability to any other party.

         5.09     Affiliate Transactions.

                  (a)   Beginning  on the  date  of this  Agreement,  Sellers
shall advise Purchaser of all material  transactions  between Sellers on the one
hand, and the Company,  the Purchaser or any of their  Subsidiaries on the other
hand. In addition,  during the term of their respective  employment  agreements,
each Seller shall give  Purchaser at least five (5) Business  Days notice of any
proposed  transactions  involving the  acquisition or disposition of Purchaser's
Common  Shares  and shall  conduct  all  transactions  so as to comply  with all
applicable securities laws.

                  (b)   No  later than December 31, 1999,  Sellers will cause
the Company and its Subsidiaries,  on the one hand, and Sellers and their family
members,  family trusts and related persons,  on the other hand to repay in full
all debt owed by either group to the other.

         5.10  Closing  Share  Restrictions.  Banks  and  Gloeckl  shall  retain
ownership of their Purchaser Closing Shares for a period of three years from the
Closing Date. For one year  thereafter,  Messrs.  Banks and Gloeckl shall retain
ownership of Purchaser  Closing Shares having a value of at least $3 million and
$1 million respectively.  Mathis shall retain ownership of his Purchaser Closing
Shares  for a period of one  year.  Each  Seller  may,  at any  time,  pledge or
encumber his Purchaser Closing Shares to secure personal borrowings.

                                   ARTICLE VI
                             COVENANTS OF PURCHASER

         Purchaser covenants and agrees with Sellers that, at all times from and
after the date hereof,  Purchaser  will comply with all covenants and provisions
of this  Article  VI,  except to the extent  Sellers  may  otherwise  consent in
writing.

         6.01.  Regulatory  and  Other  Approvals.  Purchaser  will (a) take all
commercially reasonable steps necessary or desirable, and proceed diligently and
in good  faith and use all  commercially  reasonable  efforts,  as  promptly  as
practicable to obtain all consents, approvals or actions of, to make all filings
with and to give all notices to  Governmental  or Regulatory  Authorities or any
other Person required of Purchaser to consummate the  transactions  contemplated
hereby, including,  without limitation, those described in Schedule 4.05 hereto,
(b) provide such other  information and  communications  to such Governmental or
Regulatory  Authorities  or other  Persons as Sellers  or such  Governmental  or
Regulatory Authorities or other Persons may reasonably request and (c) cooperate
with Sellers,  the Company and the  Subsidiaries  as promptly as  practicable in
obtaining  all  consents,  approvals or actions of,  making all filings with and
giving all notices to  Governmental  or Regulatory  Authorities or other Persons
required  of  Sellers,   the  Company  or  any   Subsidiary  to  consummate  the
transactions contemplated hereby and by the Operative Agreements. Purchaser will
provide prompt notification to Sellers when any such consent,  approval, action,
filing or notice  referred to in clause (a) above is  obtained,  taken,  made or
given, as applicable, and will advise Sellers of any communications (and, unless
precluded by Law, provide copies of any such communications that are in writing)
with any  Governmental or Regulatory  Authority or other Person regarding any of
the transactions contemplated by this Agreement.

         6.02.  Notice and Cure.  Purchaser  will  notify  Sellers  promptly  in
writing of, and  contemporaneously  will  provide  Seller with true and complete
copies of any and all  information  or  documents  relating to, and will use all
commercially reasonable efforts to cure, any event,  transaction or circumstance
occurring  after  the date of this  Agreement  that  causes  or will  cause  any
covenant or agreement of Purchaser  under this  Agreement to be breached or that
renders or will  render  untrue any  representation  or  warranty  of  Purchaser
contained  in this  Agreement  as if the same  were made on or as of the date of
such  event,  transaction  or  circumstance.  No notice  given  pursuant to this
Section shall have any effect on the representations,  warranties,  covenants or
agreements contained in this Agreement for purposes of determining  satisfaction
of any condition  contained  herein or shall in any way limit  Sellers' right to
seek indemnity under Article X.

         6.03  Limitation  of  Sellers'  Liabilities.  Purchaser  will  take all
necessary  actions to insure that Sellers  have no  obligations  or  liabilities
whatsoever  relating  to the  Company or the  Subsidiaries  or their  respective
businesses,  properties  or  assets,  as the same  may  exist on or prior to the
Closing  Date or arise  thereafter  (other  than  liabilities  arising  under or
expressly  preserved  under this  Agreement  and  liabilities  arising  from the
Sellers' own tortuous  conduct).  Purchaser will  cooperate  with Sellers,  both
before and after the  Closing,  by taking,  and after the  Closing  causing  the
Company and the Subsidiaries to take, all actions Sellers  reasonably request to
effectuate the termination of any such obligation or liability  asserted against
or imposed on Sellers, including Purchaser's using its best efforts to provide a
substitute  guaranty  or other  arrangement  to  release  Sellers  from any such
liability or obligation.

         6.04 Employees.  Purchaser will cause the Company and the  Subsidiaries
to continue to employ, for a period of at least one year after the Closing Date,
those employees of the Company and the  Subsidiaries  listed on Schedule 6.04 on
terms and conditions,  including  compensation and benefits, at least comparable
to those in effect at or  immediately  prior to the Closing;  provided  that the
foregoing will not preclude the Company or the Subsidiaries from terminating any
of such employees for cause during such period.  Purchaser will use commercially
reasonable  efforts  to  retain  all  other  employees  of the  Company  and its
Subsidiaries  for a period of one year on  comparable  terms and  conditions  to
those in effect prior to the Closing Date,  but all such  employees  will remain
"at will" employees.

         6.05  Post-Closing  Operations  of the  Company  and the  Subsidiaries.
Following the Closing and until September 30, 2002, Purchaser shall not take any
action  the sole  purpose  of which is to  reduce  the  income or  increase  the
expenses of the Company and its  Subsidiaries (on a consolidated  basis),  other
than such  decreases in income and  increases in expenses as can be adjusted for
in calculating Net Income under Section 2.04,  without the prior written consent
of the  Sellers.  Nothing  in this  Agreement  shall be deemed or  construed  to
preclude  Purchaser from operating the Company and its  Subsidiaries in a manner
consistent  with  Purchaser's  overall  business plan and in compliance with all
applicable  Laws,  Contracts and  standards  imposed by third  parties,  such as
FannieMae.
         6.06 704(c) Gain..  Purchaser has not adopted,  and will not adopt, any
method for  reconciling  the  difference  between the value and tax basis of the
Midland  Shares  under  Section  704(c) of the Code which  would  result in such
difference   being   reconciled,   or  Sellers   otherwise   being  allocated  a
disproportionate  amount of  Purchaser's  income or gain,  prior to  Purchaser's
disposition of the Midland Shares.

                                   article vii
                       TAX MATTERS AND POST-CLOSING TAXES

         7.01.  Pre-Closing  Tax Returns.  Sellers  shall prepare or cause to be
prepared,  and file or cause to be filed all Tax Returns or claims for refund of
the  Company for all  taxable  periods of the Company  ending on or prior to the
Closing Date  ("Pre-Closing Tax Returns").  With respect to any such Pre-Closing
Tax Returns  required  to be filed by Sellers  and not filed  before the Closing
Date,  Sellers shall provide Purchaser and its authorized  representatives  with
copies of any such  completed  Tax Return at least 15 Business Days prior to the
due date for  filing of such Tax Return and  Purchaser  and its  representatives
shall  have the right to review  (but not to  require  any  change  to) such Tax
Return  prior to the  filing of such Tax  Return,  which  each  Seller is hereby
irrevocably  authorized to sign on behalf of the Company. All Taxes with respect
to such Tax Returns  ("Pre-Closing Taxes") which exceed the accruals therefor as
shown on the Closing  Audit  shall be paid as follows.  All such Taxes which are
federal  income  taxes shall be paid by  Sellers;  all other such Taxes shall be
paid by  Purchaser or the Company and shall  constitute a Loss to Purchaser  for
purposes of Section 10.02. Purchaser shall not amend any Pre-Closing Tax Returns
without  the  Sellers'  consent.  Sellers  shall not  amend any such Tax  Return
without  the  written   approval  of  Purchaser,   which  approval  may  not  be
unreasonably withheld.

         7.02.  Transfer  Taxes.  Purchaser shall pay one-half and Sellers shall
pay  one-half  of any and all sales,  use,  transfer,  real  property  transfer,
recording,  gains,  stamp  stock  transfer  and  other  similar  taxes  and fees
("Transfer  Taxes")  arising  out  of or in  connection  with  the  transactions
effected pursuant to this Agreement, and each shall indemnify,  defend, and hold
harmless  the other with  respect to its  proportionate  share of such  Transfer
Taxes.  The party  required by law to file all necessary  documentation  and Tax
Returns with respect to such Transfer Taxes shall do so.

         7.03.    Post-Closing Taxes and Sellers' Post-Closing Taxes.

                  (a)   Purchaser  shall timely prepare and file (or cause to
be prepared  and filed) all Tax Returns  required by law for all Taxes  covering
the Company  for periods  ending  after the date of Closing,  including  periods
which  include  a  period  prior  to the  date  of  Closing  ("Post-Closing  Tax
Returns").  Purchaser  will  determine  in good  faith  the  basis on which  all
Post-Closing Tax Returns are to be filed. Purchaser shall timely pay or cause to
be paid all Taxes relating to Post-Closing Tax Returns ("Post-Closing Taxes").

                  (b)   For  purposes  of  determining  the  adequacy  of the
accruals for Taxes on the Company's balance sheets as of the date of the Closing
Audit (prepared in accordance  with GAAP),  the amount of any Taxes for a period
beginning  before and ending after the date of the Closing  Audit which shall be
deemed to have  accrued on or before the date of the  Closing  Audit  ("Sellers'
Post-Closing Taxes") shall be:

                     (i) in the case of any real or personal property Tax,
an amount equal to the Tax for the Assets and Properties owned by the Company or
any  Subsidiary on the date of the Closing Audit for the entire  taxable  period
multiplied  by a fraction  the  numerator  of which is the number of days in the
entire  taxable  period  ending  on  the  date  of the  Closing  Audit  and  the
denominator of which is the number of days in the entire taxable period;

                     (ii)     in the case of any other Tax, the amount that
would be payable by the Company or any  Subsidiary if its taxable year ended on
the date of the Closing Audit.

At least 30 days  prior to the  filing  of any  Post-Closing  Tax  Return  which
includes any Sellers' Post-Closing Taxes, Purchaser shall provide Sellers with a
copy of the return along with Purchaser's  calculation of Sellers'  Post-Closing
Taxes related thereto and shall, at the request of Sellers, during the following
30 days consult with Sellers concerning such Post-Closing Tax Return.

                  (c)   Upon  the  filing of the  Post-Closing  Tax  Returns,
Sellers  shall  pay  to  Purchaser  any of  Seller's  Post-Closing  Taxes  which
constitute  federal  income  taxes to the extent such Taxes  exceed the accruals
therefor as shown on the Closing  Audit;  all of Seller's  Post-  Closing  Taxes
which are not federal income taxes shall be paid by Purchaser or the Company and
shall constitute a Loss to Purchaser for purposes of Section 10.02.

         7.04.  Notification of Audits.  Purchaser shall promptly notify Sellers
in writing upon receipt by Purchaser of notice of (i) any pending or  threatened
federal,  state,  local or foreign Tax audits or assessments of the Company,  so
long as any period  relating to  Pre-Closing  Taxes remains  open,  and (ii) any
pending or threatened federal, state, local or foreign Tax audits or assessments
of the Purchaser  which may affect the Tax  liabilities of the Company,  in each
case for periods relating to Pre-Closing Taxes only.

         7.05. Maintenance of Records. After the date of Closing,  Purchaser and
Sellers  shall  make  available  to the  other,  as  reasonably  requested,  all
information,  records or documents  relating to Tax liabilities or potential Tax
liabilities  of  Sellers,  any  Affiliate  of  Sellers  or  the  Company  or any
Subsidiary for any period commencing before the Closing Date and for the portion
of any period  allocated to Sellers under Section 7.03,  and shall  preserve all
such  information,  records and documents until the expiration of any applicable
statute of limitations,  including  extensions  thereof, or such other period as
required by Law.  Purchaser and Sellers shall also make  available to each other
as reasonably  requested by Purchaser or Sellers,  as the case may be, personnel
responsible for preparing or maintaining information,  records and documents, in
connection  with Tax  matters.  In case at any time after the  Closing  Date any
further  action is necessary to carry out the  purposes of this  Agreement,  the
parties hereto shall take all such necessary action.

         7.06.  Purchase  Price  Adjustment  Any payments  made to Sellers,  the
Company or Purchaser pursuant to this Article VII shall constitute an adjustment
of the Purchase Price for Tax purposes and shall be treated as such by Purchaser
and Sellers on their Tax Returns to the extent permitted by law.

         7.07. Tax Sharing Agreements. All Tax sharing or similar agreements, if
any, to which the Company or its Subsidiaries is a party will be cancelled at or
prior to the Closing and neither the Company,  its  Subsidiaries  nor  Purchaser
shall not be bound thereby or have any obligation thereunder.

                                  ARTICLE VIII
                              CONDITIONS TO CLOSING

         8.01 Conditions to Purchaser's  Performance.  Purchaser's obligation to
proceed to Closing shall be conditioned  upon the satisfaction (or the waiver in
writing by Purchaser) of each of the following:

                  (a)   Michael L. Falcone shall have been elected as a trustee
of the Trust effective as of the Closing.

                  (b)   Sellers shall have obtained and delivered to Purchaser
written  consent to the Transaction of FannieMae and the Trust and each other
Person listed on Schedule 8.01.

                  (c)   Each of Sellers'  representations  and warranties set
forth in Article  III shall be true and  correct in all  material  respects  and
Sellers shall so certify in writing at Closing.

                  (d)   Sellers shall be in a position to deliver to Purchaser
certificates  evidencing the Midland Shares and good and valid title to the
Shares, free and clear of all Liens.

                  (e)   Sellers shall have performed in all material respects
all obligations and agreements and complied with all covenants in this Agreement
or in any  Operative  Agreement  to be  performed  and  complied  with by any of
Sellers at or before Closing and Sellers shall so certify in writing at Closing.

                  (f)   Each  of Sellers shall have executed and delivered to
Purchaser that employment agreement in the form attached hereto as Exhibit B and
intended to be executed by him (collectively,  the "Employment Agreements"). The
Employment  Agreements  shall provide  collectively  for an annual salary before
incentive  compensation  of  $650,000 to be divided  among the Sellers  (and any
replacement  for Ray Mathis  after his  contract  expires)  as the  Sellers  may
decide.

                  (g)   Purchaser  shall have received  certificates  of good
standing for the Company and each of its Subsidiaries for the States of Florida,
Michigan,  California  and Texas and each other state  listed on Schedule  3.03,
each such certificate of good standing to be dated as of a date not more than 30
days prior to the Closing Date.

                  (h)   Purchaser shall have received an estoppel  certificate
from the lessor under the real property lease for the Company's Florida offices.

                  (i)   There  shall not have  occurred any material  adverse
change in the Business or Condition of the Company since the Unaudited Financial
Statement  Date,  and with respect to the Assets and  Properties  of the Company
there have been no payment  defaults and no occurrence which if not waived would
result in a payment default.

                  (j)   All  notice  periods  shall have elapsed or otherwise
been terminated under the HSR Act.

                  (k)   There  shall not have been  commenced  or  threatened
against  Sellers,  Purchaser or any Affiliate of either any Action of Proceeding
(i) involving any challenge to, or seeking damages or other relief in connection
with  any of the  transactions  contemplated  hereby  or (ii)  that may have the
effect of preventing,  delaying,  making illegal, or otherwise  interfering with
any of such transactions.

                  (l)   There  shall not have been made or  threatened by any
Person any claim  asserting  that such  Person  (i) is a holder or a  beneficial
owner of, or has any Option  with  respect  to,  any of the stock,  or any other
voting,  equity or ownership  interest in, the Company or any Subsidiary or (ii)
is entitled to all or any portion of the Purchase Price.

                  (m)   Sellers  shall have provided  Purchaser with evidence
of the  termination  of  that  certain  agreement  known  as  Midland  Financial
Holdings, Inc. Optional-Purchase Stock Agreement dated January 2, 1991 among the
Company and the Sellers.

         8.02 Conditions to Sellers' Performance. Sellers' obligation to proceed
to Closing shall be conditioned  upon the satisfaction (or the waiver in writing
by Sellers) of each of the following:

                  (a)   Purchaser   shall  have  obtained  and  delivered  to
Sellers the written  consent to the  Transaction of each of the  following:  (i)
each Person whose consent to the Transaction is required by any Contract,  Order
or Law by which  Purchaser is bound or to which it is subject and (ii) the Board
of Directors of Purchaser.

                  (b)   Each  of Purchaser's  representations  and warranties
set forth in  Article  IV of this  Agreement  shall be true and  correct  in all
material respects and Purchaser shall so certify at Closing.

                  (c)   Purchaser   shall  have  performed  in  all  material
respects all  obligations and agreements and complied with all covenants in this
Agreement or in any  Operative  Agreement to be performed  and complied  with by
Purchaser  at or before  Closing  and  Purchaser  shall so certify in writing at
Closing.

                  (d)   Purchaser shall have executed and delivered to Sellers
the Employment Agreements.

                  (e)   Purchaser shall have executed and delivered to Sellers
the Registration  Rights Agreement (the "Registration Rights Agreement")
attached hereto as Exhibit C.

                  (f)   All  notice  periods  shall have elapsed or otherwise
been terminated under the HSR Act.

                  (g)   There  shall not have been  commenced  or  threatened
against  Sellers or any  Affiliate  of  Sellers  any  Action or  Proceeding  (i)
involving  any  challenge  to, or seeking  damages or other relief in connection
with,  any of the  transactions  contemplated  hereby  or (ii) that may have the
effect of preventing,  delaying,  making illegal, or otherwise  interfering with
any of such transactions.

                  (h)   There shall not have occurred any adverse  change in the
Business or Condition of the  Purchaser  since June 30, 1999 which would require
a filing by Purchaser with the SEC.

                  (i)   Robert Banks shall have been elected to a three-year
term as a director of  Purchaser, effective as of the Closing Date.

                                   ARTICLE IX
                    SURVIVAL OF REPRESENTATIONS, WARRANTIES,
                            COVENANTS AND AGREEMENTS

         9.01 Survival of Representations, Warranties, Covenants and Agreements.
Notwithstanding any right of Purchaser (whether or not exercised) to investigate
the  affairs  of the  Company  and the  Subsidiaries  or any  right of any party
(whether or not  exercised) to investigate  the accuracy of the  representations
and  warranties  of the other party  contained  in this  Agreement,  Sellers and
Purchaser  have the right to rely  fully upon the  representations,  warranties,
covenants  and  agreements  of  the  other  contained  in  this  Agreement.  The
representations,  warranties,  covenants and agreements of Sellers and Purchaser
contained  in this  Agreement  will  survive the Closing (a)  indefinitely  with
respect to the representations and warranties  contained in Sections 3.02, 3.04,
3.05 (but only insofar as it relates to the capital stock of the  Subsidiaries),
3.30,  4.02,  4.03,  4.07,  4.08 and 10.01(c),  and the  indemnity  contained in
Section  10.01(b),  (b) until six years after the Closing  Date with  respect to
matters covered by Sections 3.10, 4.01, 4.13, 6.06,  10.01(a) and 10.02(d),  (c)
until one year after the date of  Closing  in the case of  Section  3.13 and all
other  representations  and  warranties  and any  covenant  or  agreement  to be
performed  in whole or in part on or prior to the Closing or (d) with respect to
each other  covenant or  agreement  contained  in this  Agreement,  for a period
comparable  to that used in clause  (c)  following  the last date on which  such
covenant  or  agreement  is to be  performed  or, if no such date is  specified,
indefinitely,  except that any representation,  warranty,  covenant or agreement
that would  otherwise  terminate in accordance with clause (b), (c) or (d) above
will continue to survive if a Claim Notice or Indemnity  Notice (as  applicable)
shall have been  timely  given under  Article X on or prior to such  termination
date,  until  the  related  claim  for  indemnification  has been  satisfied  or
otherwise resolved as provided in Article X.

         9.02 Certain Purchase Rights. In the event of a Business Combination as
defined in Section  12.1 of  Purchaser's  Amended and  Restated  Certificate  of
Formation and Operating Agreement which does not meet the voting requirements of
either  Section 12.2 or Section  12.3(b)(i)  of such  Operating  Agreement,  the
members of the Board of  Directors of the Company,  as  constituted  immediately
prior to the effective date of such Business  Combination,  shall have the right
to acquire the Company and its Subsidiaries from Purchaser for the fair value of
the Company and its  Subsidiaries.  Fair value shall be  determined by Robert A.
Stanger & Co.,  Inc.,  or if it shall no longer be in the business of performing
such  valuations for real estate lending  companies,  then by a firm which is an
expert in such valuations and which is mutually  agreeable to Purchaser and such
Board  members.  The Board members shall notify  Purchaser in writing within ten
(10) Business  Days after the Board  members have notice of the Control  Company
Interests  Acquisition or Business  Combination that they wish to exercise their
rights  hereunder.  Within ten (10)  Business  Days after  their  receipt of the
determination of fair value,  the Board members shall notify  Purchaser  whether
they  wish to  proceed.  If  they  elect  to  proceed,  the  purchase  shall  be
consummated within one hundred twenty (120) days of such election, at which time
the purchase price shall be paid in cash and Purchaser  shall deliver such bills
of sale, stock  certificates and other  instruments of title as may be necessary
to convey  complete  ownership  of the  Company and its  Subsidiaries  and their
respective assets and properties to the Board members or their designees. During
the period between valuation and closing, Purchaser shall take no action outside
the ordinary  course of business  which could have a Material  Adverse Effect on
the value of the Company and its  Subsidiaries.  This Section 9.02 shall survive
the Closing for a period of twenty (20) years.

                           ARTICLE X - INDEMNIFICATION

         10.01.   Tax Indemnifications.

                  (a)   Sellers  will  indemnify  and hold  harmless  Purchaser
and the  Company  from and against  liability for Pre-Closing Taxes and Sellers'
Post-Closing Taxes in accordance with Sections 7.01 and 7.03(c).

                  (b)   Purchaser  agrees to promptly indemnify and reimburse
Sellers for all federal  income taxes which they are required to pay as a result
of a determination  by IRS that the delivery of the Purchaser  Closing Shares or
the Earn-out Shares is a recognition  event for federal income tax purposes,  or
if any payment of Earn-out  Shares is made in cash under  Section  2.04(e).  The
amount  of the  indemnity  shall be the  amount of tax  which  the  Sellers  are
required to pay to the IRS as a  consequence  of the  foregoing,  plus an amount
sufficient to pay any  additional tax the Sellers are required to pay on account
of such  payment,  plus any interest and  penalties  the Sellers are required to
pay. If, in lieu of Earn-Out Shares,  Purchaser at any time pays cash to Sellers
pursuant to Section 2.04(e) of this Agreement,  then Purchaser shall also pay in
cash,  at the same time,  an amount equal to the amount of tax which the Sellers
are required to pay to the IRS as a consequence of the foregoing, plus an amount
sufficient to pay any  additional tax the Sellers are required to pay on account
of such  payment,  plus any interest and  penalties  the Sellers are required to
pay.

                  (c)   Unless  and  until the IRS shall  notify  Sellers  in
writing to the contrary,  Sellers shall treat delivery of the Purchaser  Closing
Shares and the Earn-out  Shares as  non-recognition  events under Section 721 of
the Code neither  Sellers nor Purchaser  and shall take any action  inconsistent
with such treatment.

         10.02.   Other Indemnification.

                  (a)   Sellers  shall,  jointly  and  severally,   indemnify
Purchaser  and its  officers,  directors,  employees,  agents and  Affiliates in
respect of, and hold each of them harmless from and against,  any and all Losses
suffered,  incurred or  sustained by any of them or to which any of them becomes
subject,  resulting from,  arising out of or relating to any  misrepresentation,
breach of warranty or  nonfulfillment  of or failure to perform any  covenant or
agreement on the part of Sellers contained in this Agreement.

                  (b)   Purchaser  agrees to indemnify  Sellers and hold each
of them  harmless  from and against,  any and all Losses  suffered,  incurred or
sustained  by any of them or to which  any of them  becomes  subject,  resulting
from, arising out of or relating to any misrepresentation, breach of warranty or
nonfulfillment of or failure to perform any covenant or agreement on the part of
Purchaser contained in this Agreement.

                  (c)   No  amounts shall be payable as a result of any claim
arising under  Sections  10.01(a) or 10.02(a)  unless and until the  Indemnified
Parties  thereunder  have  suffered,  incurred,  sustained or become  subject to
Losses referred to in such Section in excess of $1,000,000 in the aggregate,  in
which event the  Indemnified  Parties  shall only be entitled to seek  indemnity
from  Sellers for the amount of losses in excess of  $1,000,000,  provided  that
this paragraph (c) shall not limit Purchaser's right to indemnity resulting from
a misrepresentation or breach of warranty by Sellers contained in Sections 3.02,
3.04 and 3.24.

         Notwithstanding  anything to the contrary  contained in this Agreement,
in no event shall Sellers'  aggregate  liability under this Agreement exceed $10
million.

                  (d)   Sellers  shall  indemnify  and  hold  Purchaser,  the
Company and its Subsidiaries  harmless from any and all Loss on any construction
loans made by the Company or its Subsidiaries on those certain projects known as
Manhattan Square and the Capstone transaction in Eugene,  Oregon. This indemnity
shall not be subject to the limitations of Section 10.02(c).

                  (e)   The remedies provided in Sections  10.01(a),  10.02(a)
and 10.02(d)  constitute the exclusive remedy against Sellers for any claim in
connection with this Agreement.

         10.03.  Method of Asserting Claims.  All claims for  indemnification by
any  Indemnified  Party under  Section  10.02 will be asserted  and  resolved as
follows:

                  (a)   In  the event any claim or demand in respect of which
an  Indemnifying  Party might seek  indemnity  under  Section  10.02 is asserted
against or sought to be collected from such Indemnified  Party by a Person other
than Sellers, the Company, any Subsidiary, Purchaser or any Affiliate of Sellers
or Purchaser (a "Third Party  Claim"),  the  Indemnified  Party shall  deliver a
Claim  Notice with  reasonable  promptness  to the  Indemnifying  Party.  If the
Indemnified  Party fails to provide the Claim Notice with reasonable  promptness
after the  Indemnified  Party  receives  notice of such Third Party  Claim,  the
Indemnifying Party will not be obligated to indemnify the Indemnified Party with
respect to such Third Party Claim to the extent  that the  Indemnifying  Party's
ability to defend has been prejudiced by such failure of the Indemnified Party.

                     (i) The  Indemnifying  Party will have the right upon
notice to the Indemnified  Party to defend,  at the sole cost and expense of the
Indemnifying Party, such Third Party Claim by all appropriate proceedings, which
proceedings will be prosecuted by the  Indemnifying  Party to a final conclusion
or will be settled at the  discretion of the  Indemnifying  Party (but only with
the consent of the Indemnified Party,  which shall not be unreasonably  withheld
or delayed,  in the case of any  settlement  that  provides for any relief other
than the  payment of monetary  damages.  The  Indemnifying  Party will have full
control of such defense and proceedings,  including any compromise or settlement
thereof; provided, however, that the Indemnified Party may, at the sole cost and
expense of the Indemnified Party, at any time prior to the Indemnifying  Party's
delivery  of the notice  referred  to in the first  sentence of this clause (i),
file any motion,  answer or other  pleadings  or take any other  action that the
Indemnified Party reasonably  believes to be necessary or appropriate to protect
its  interests;  and provided  further,  that if  requested by the  Indemnifying
Party,  the  Indemnified  Party  will,  at the  sole  cost  and  expense  of the
Indemnifying Party, provide reasonable  cooperation to the Indemnifying Party in
contesting any Third Party Claim that the Indemnifying  Party elects to contest.
The  Indemnified  Party may  participate  in, but not  control,  any  defense or
settlement  of any  Third  Party  Claim  controlled  by the  Indemnifying  Party
pursuant to this clause (i), and except as provided in the  preceding  sentence,
the Indemnified  Party will bear its own costs and expenses with respect to such
participation.  Notwithstanding  the foregoing,  the Indemnified  Party may take
over the control of the defense or settlement of a Third Party Claim at any time
if it irrevocably waives its right to indemnity under Section 10.02 with respect
to such Third  Party  Claim and agrees to  indemnify  and hold the  Indemnifying
Party harmless from any Losses results from such Third Party Claim.

                     (ii)  If the  Indemnifying  Party fails to  prosecute
reasonably  diligently the Third Party Claim,  then the  Indemnified  Party will
have the right to  defend,  at the sole  cost and  expense  of the  Indemnifying
Party, the Third Party Claim by all appropriate  proceedings,  which proceedings
will be prosecuted  by the  Indemnified  Party in a diligent  manner and in good
faith and may be settled at the  discretion of the  Indemnified  Party (with the
consent of the Indemnifying Party, which consent may be withheld or given at the
Indemnifying Party's  discretion).  The Indemnified Party will have full control
of such defense and proceedings, including any compromise or settlement thereof;
provided,  however, that if requested by the Indemnified Party, the Indemnifying
Party will,  at the sole cost and  expense of the  Indemnifying  Party,  provide
reasonable  cooperation to the  Indemnified  Party and its counsel in contesting
any  Third  Party  Claim  which  the  Indemnified   Party  is  contesting.   The
Indemnifying  Party  may  participate  in,  but  not  control,  any  defense  or
settlement controlled by the Indemnified Party pursuant to this clause (ii), and
the Indemnifying Party will bear its own costs and expenses with respect to such
participation.  If the Indemnifying Party disputes its liability with respect to
the Third  Party Claim  under  Section  10.02,  the  Indemnifying  Party and the
Indemnified  Party will proceed in good faith to negotiate a resolution  of such
dispute,  and if such claim is less than $1,000,000 and is not resolved  through
negotiations  within the  Resolution  Period,  such dispute shall be resolved by
arbitration in accordance with paragraph (d) of this Section 10.03.

                  (b)   In  the event any  Indemnified  Party  should  have a
claim under Section 10.02 against any Indemnifying Party that does not involve a
Third Party Claim, the Indemnified  Party shall deliver an Indemnity Notice with
reasonable  promptness to the Indemnifying Party. The failure by any Indemnified
Party  to give the  Indemnity  Notice  shall  not  impair  such  party's  rights
hereunder  except to the extent that an Indemnifying  Party has been irreparably
prejudiced  thereby.  If the  Indemnifying  Party  disputes its  liability  with
respect to such claim,  the  Indemnifying  Party and the Indemnified  Party will
proceed in good faith to negotiate a  resolution  of such  dispute,  and if such
claim is less than $1,000,000 and is not resolved  through  negotiations  within
the  Resolution  Period,  such  dispute  shall be  resolved  by  arbitration  in
accordance with paragraph (d) of this Section 10.03.

                  (c)   In the  event of any Loss in  excess  of  $100,000,
resulting  from a  misrepresentation,  breach of warranty or  nonfulfillment  or
failure to be performed of any covenant or agreement contained in this Agreement
as to which an  Indemnified  Party would be entitled  to claim  indemnity  under
Section 10.02 but for the provisions of paragraph (c) thereof,  such Indemnified
Party  may  nevertheless  deliver a written  notice  to the  Indemnifying  Party
containing  the  information  that  would be  required  in a Claim  Notice or an
Indemnity Notice, as applicable,  with respect to such Loss. If the Indemnifying
Party  notifies  the  Indemnified  Party  that it does  not  dispute  the  claim
described  therein or fails to notify the  Indemnified  Party within the Dispute
Period whether the Indemnifying Party disputes the claim described in such Claim
Notice or Indemnity Notice, as the case may be, the Loss specified in the notice
will be conclusively  deemed to have been incurred by the Indemnified  Party for
purposes  of making  the  determination  set forth in  paragraph  (c) of Section
10.02. If the Indemnifying Party has timely disputed the claim described in such
Claim Notice or Indemnity Notice, as the case may be, the Indemnifying Party and
the  Indemnified  Party will proceed in good faith to negotiate a resolution  of
such dispute,  and if less than $1,000,000 and not resolved through negotiations
within the Resolution  Period,  such dispute shall be resolved by arbitration in
accordance with paragraph (d) of this Section 10.03.

                  (d)   Any dispute  submitted to  arbitration  pursuant to
this Section 10.03 shall be finally and conclusively  determined by the decision
of a board of  arbitration  consisting of three members  (hereinafter  sometimes
called the "Board of Arbitration") selected as hereinafter provided. Each of the
Indemnified Party and the Indemnifying Party shall select one (1) member and the
third member shall be selected by mutual  agreement of the other members,  or if
the other  members fail to reach  agreement on a third member within twenty days
after their  selection,  such third member shall  thereafter  be selected by the
American Arbitration Association upon application made to it for such purpose by
the  Indemnified  Party.  The  Board of  Arbitration  shall  meet in Tampa  Bay,
Florida,  or Baltimore,  Maryland,  as a majority of the members of the Board of
Arbitration  may  determine,  and shall  reach and render a decision  in writing
(concurred  in by a majority  of the members of the Board of  Arbitration)  with
respect to the amount,  if any, which the Indemnifying  Party is required to pay
to the Indemnified  Party in respect of a claim filed by the Indemnified  Party.
In connection with rendering its decisions, the Board of Arbitration shall adopt
and follow such rules and  procedures  as a majority of the members of the Board
of  Arbitration  deems  necessary  or  appropriate.  To  the  extent  practical,
decisions  of the Board of  Arbitration  shall be  rendered  no more than thirty
calendar days following  commencement of proceedings with respect  thereto.  The
Board of  Arbitration  shall cause its written  decision to be  delivered to the
Indemnified Party and the Indemnifying  Party. Any decision made by the Board of
Arbitration (either prior to or after the expiration of such thirty calendar day
period) shall be final,  binding and conclusive on the Indemnified Party and the
Indemnifying  Party and entitled to be enforced to the fullest extent  permitted
by law and  entered in any court of  competent  jurisdiction.  Each party to any
arbitration shall bear its own expense in relation thereto,  including,  but not
limited to, such party's  attorneys'  fees, if any, and the expenses and fees of
the  member of the  Board of  Arbitration  appointed  by such  party,  provided,
however,  that  the  expenses  and  fees of the  third  member  of the  Board of
Arbitration  and any other expenses of the Board of  Arbitration  not capable of
being  attributed  to any one  member  shall  be  borne  in  equal  parts by the
Indemnifying  Party and the  Indemnified  Party  Board of  Arbitration  shall be
divided between the  Indemnifying  Party and the  Indemnified  Party in the same
proportion  as the  portion  of the  related  claim  determined  by the Board of
Arbitration to be payable to the Indemnified  Party bears to the portion of such
claim determined not to be so payable.

                           ARTICLE XI - MISCELLANEOUS

         11.01.   Notices.  All  notices,   requests  and  other  communications
hereunder  must be in writing and will be deemed to have been duly given only if
delivered personally or by facsimile transmission or mailed (first class postage
prepaid) to the parties at the following addresses or facsimile numbers:

         If to Purchaser, to:

         Municipal Mortgage & Equity LLC
         218 North Charles Street, Suite 500
         Baltimore, Maryland 21201-4019
         Facsimile No.:  410-727-5387
         Attn:  Michael L. Falcone

         with a copy to:

         Rogers & Wells LLP
         200 Park Avenue
         New York, New York 10166
         Facsimile No.:  212-878-8375
         Attn:  Robert E. King, Jr.

         and a copy to:

         Gallagher, Evelius & Jones, LLP
         218 N. Charles Street, Suite 400
         Baltimore, Maryland 21201
         Facsimile No.:  410-837-3085
         Attn:  Stephen A. Goldberg

         If to Sellers, to:

         Robert J. Banks
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         and

         Keith J. Gloeckl
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         and

         Ray F. Mathis
         Midland Financial Holdings, Inc.
         33 N. Garden Avenue, Suite 1200
         Clearwater, Florida 33755
         Facsimile No.:  727-443-6067

         with a copy to:

         Honigman Miller Schwartz and Cohn
         2290 First National Building
         Detroit, Michigan 48226
         Facsimile No.:  313-465-7357
         Attn:  Gregory J. DeMars

All such  notices,  requests  and  other  communications  will (i) if  delivered
personally  to the  address as provided in this  Section,  be deemed  given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section,  be deemed given upon receipt,  and (iii) if delivered
by mail in the  manner  described  above  to the  address  as  provided  in this
Section,  be deemed given upon receipt (in each case  regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice is to be delivered pursuant to this Section). Any party from
time to time may change its address,  facsimile number or other  information for
the purpose of notices to that party by giving notice  specifying such change to
the other party hereto.

         11.02.  Entire Agreement.  This Agreement and the Operative  Agreements
supersedes all prior discussions and agreements between the parties with respect
to the subject matter hereof and thereof,  including,  without limitation,  that
certain  letter of intent  between the parties dated May 27, 1999,  and contains
the sole and entire  agreement  between the parties  hereto with  respect to the
subject matter hereof and thereof.

         11.03.  Expenses.  Except  as  otherwise  expressly  provided  in  this
Agreement,  whether or not the transactions contemplated hereby are consummated,
each party will pay its own costs and expenses,  and Sellers shall pay the costs
and expenses of the Company and the  Subsidiaries,  incurred in connection  with
the  negotiation,  execution and closing of this Agreement and the  transactions
contemplated hereby.

         11.04.  Public  Announcements.  Sellers and Purchaser will not issue or
make any  reports,  statements  or  releases to the public or  generally  to the
employees,  customers,  suppliers  or other  Persons to whom the Company and the
Subsidiaries  sell goods or provide  services  or with whom the  Company and the
Subsidiaries  otherwise have significant business  relationships with respect to
this Agreement or the  transactions  contemplated  hereby without the consent of
the other, which consent shall not be unreasonably  withheld. If either party is
unable to obtain the  approval of its public  report,  statement or release from
the other  party and such  report,  statement  or release  is, in the opinion of
legal counsel to such party,  required by Law in order to discharge such party's
disclosure  obligations,  then such party may make or issue the legally required
report,  statement or release and  promptly  furnish the other party with a copy
thereof. Sellers and Purchaser will also obtain the other party's prior approval
of any press  release to be issued  immediately  following the execution of this
Agreement and upon Closing.

         11.05.  Confidentiality.  Each party hereto will hold, and will use its
best efforts to cause its Affiliates  and their  respective  Representatives  to
hold, in strict  confidence  from any Person  (other than any such  Affiliate or
Representative),  unless (i) compelled to disclose by judicial or administrative
process  (including,  without  limitation,  in  connection  with  obtaining  the
necessary  approvals of this Agreement and the transactions  contemplated hereby
of  Governmental or Regulatory  Authorities) or by other  requirements of Law or
(ii)  disclosed in an Action or Proceeding  brought by a party hereto in pursuit
of its rights or in the exercise of its remedies  hereunder,  all  documents and
information  concerning the other party or any of its Affiliates furnished to it
by the other party or such other party's Representatives in connection with this
Agreement or the  transactions  contemplated  hereby,  except to the extent that
such documents or information can be shown to have been (a) previously  known by
the party  receiving  such  documents or  information,  (b) in the public domain
(either  prior to or after  the  furnishing  of such  documents  or  information
hereunder) through no fault of such receiving party or (c) later acquired by the
receiving  party from another  source if the  receiving  party is not aware that
such  source  is under an  obligation  to  another  party  hereto  to keep  such
documents and information confidential; provided that the foregoing restrictions
will not apply to Purchaser's  use of documents and  information  concerning the
Company and the Subsidiaries furnished by Sellers hereunder.

         11.06.   Further Assurances; Post-Closing Cooperation.

                  (a)   At  any time or from time to time after the  Closing,
Sellers and Purchaser shall execute and deliver to Purchaser or Sellers,  as the
case may be, such other  documents and  instruments,  provide such materials and
information  and take such other actions as Purchaser or Sellers may  reasonably
request more  effectively  to vest title to the Midland Shares in Purchaser and,
to the full extent  permitted by Law, to put Purchaser in actual  possession and
operating  control  of  the  Company,  the  Subsidiaries,  and  the  Tax  Credit
Partnerships and their  respective  Assets and Properties and Books and Records,
and otherwise to cause Sellers to fulfill their obligations under this Agreement
and the Operative Agreements to which they are parties.

                  (b)   Following  the  Closing,  each party will  afford the
other party,  its counsel and its  accountants,  during normal  business  hours,
reasonable access to the books,  records and other data relating to the Business
or Condition of the Company and the  Subsidiaries in its possession with respect
to  periods  prior to the  Closing  and the right to make  copies  and  extracts
therefrom,  to the extent  that such  access may be  reasonably  required by the
requesting party in connection with (i) the preparation of Tax Returns, (ii) the
determination  or enforcement of rights and  obligations  under this  Agreement,
(iii)  compliance  with  the  requirements  of any  Governmental  or  Regulatory
Authority,  (iv) the  determination or enforcement of the rights and obligations
of any  Indemnified  Party or (v) in  connection  with any actual or  threatened
Action or  Proceeding.  Further,  each party agrees for a period  extending  six
years after the Closing not to destroy or  otherwise  dispose of any such books,
records  and other  data  unless  such  party  shall  first  offer in writing to
surrender  such books,  records and other data to the other party and such other
party shall not agree in writing to take  possession  thereof during the ten day
period after such offer is made.

                  (c)   If,  in order  properly to prepare  its Tax  Returns,
other documents or reports required to be filed with  Governmental or Regulatory
Authorities or its financial statements or to fulfill its obligations hereunder,
it is necessary that a party be furnished with additional information, documents
or records  relating to the Business or Condition of the Company not referred to
in paragraph (b) above,  and such  information,  documents or records are in the
possession  or control of the other  party,  such other party shall use its best
efforts to furnish or make available such information,  documents or records (or
copies thereof) at the recipient's  request,  cost and expense.  Any information
obtained by Sellers in accordance with this paragraph shall be held confidential
by Sellers in accordance with Section 11.05.

                  (d)   Notwithstanding anything to the contrary contained in
paragraphs  (b) and (c) of this  Section,  if the parties are in an  adversarial
relationship  in  litigation or  arbitration,  the  furnishing  of  information,
documents or records in  accordance  with any provision of this Section shall be
subject to applicable rules relating to discovery.

         11.07. Waiver. Any term or condition of this Agreement may be waived at
any time by the party  that is  entitled  to the  benefit  thereof,  but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party  waiving such term or  condition.  No waiver by any
party of any term or condition of this Agreement,  in any one or more instances,
shall be deemed to be or  construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion.  All remedies,  either under
this  Agreement  or by Law or otherwise  afforded,  will be  cumulative  and not
alternative.

         11.08.  Amendment.  Except as set forth in Section 5.08, this Agreement
may be amended,  supplemented  or  modified  only by a written  instrument  duly
executed by or on behalf of each party hereto.

         11.09.  No Third Party  Beneficiary.  The terms and  provisions of this
Agreement  are  intended  solely for the benefit of each party  hereto and their
respective  successors or permitted assigns,  and it is not the intention of the
parties to confer  third-party  beneficiary  rights upon any other  Person other
than any Person entitled to indemnity under Article X.

         11.10. No Assignment;  Binding  Effect.  Neither this Agreement nor any
right,  interest or  obligation  hereunder  may be assigned by any party  hereto
without the prior  written  consent of the other party hereto and any attempt to
do so will be void,  except that  Purchaser may assign any or all of its rights,
interests and obligations hereunder (including,  without limitation,  its rights
under Article X) to a wholly-owned subsidiary, provided that any such subsidiary
agrees in  writing to be bound by all of the terms,  conditions  and  provisions
contained  herein,  but  no  such  assignment  shall  relieve  Purchaser  of its
obligations  hereunder.  Subject to the preceding  sentence,  this  Agreement is
binding upon,  inures to the benefit of and is enforceable by the parties hereto
and their respective successors and assigns.

         11.11.  Headings;  Exhibits.  The headings used in this Agreement or in
any Schedules  have been inserted for  convenience  of reference only and do not
define or limit the  provisions  hereof.  Reference  herein to Exhibits,  unless
indicated,  shall refer to the Exhibits attached to this Agreement, which hereby
are incorporated in and constitute a part of this Agreement.

         11.12.  Breach,  Abandonment,  Termination.  If any party shall fail to
fulfill its obligations hereunder,  including without limitation its obligations
to  close  and  to  satisfy   those   conditions   to  Closing   which  are  its
responsibility,  the other parties shall have all remedies  available to them at
law or in equity, including the right to specific performance.

         11.13.  Consent to  Jurisdiction  and  Service of  Process.  Each party
hereby  irrevocably  submits  to the  non-exclusive  jurisdiction  of the United
States District Court for Northern  District of Maryland and the Middle District
of Florida or any state court located in Baltimore City,  Maryland or Tampa Bay,
Florida in any such action, suit or proceeding, and agrees that any such action,
suit or proceeding shall be brought only in such court (and waives any objection
based on forum non conveniens or any other objection to venue therein).  Nothing
herein shall affect the right of any party to serve  process in any other manner
permitted by Law or to commence legal  proceedings or otherwise  proceed against
the other in any other jurisdiction.

         11.14.  Invalid Provisions.  If any provision of this Agreement is held
to be illegal,  invalid or unenforceable under any present or future Law, and if
the rights or  obligations  of any party hereto under this Agreement will not be
materially  and adversely  affected  thereby,  (a) such  provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or  unenforceable  provision had never comprised a part hereof,  (c) the
remaining  provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal,  invalid or  unenforceable  provision or by
its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision,  there  will be added  automatically  as a part of this  Agreement  a
legal,  valid and  enforceable  provision  as similar in terms to such  illegal,
invalid or unenforceable provision as may be possible.

         11.15. Governing Law. This Agreement shall be governed by and construed
in  accordance  with the Laws of the State of Maryland  applicable to a Contract
executed and performed in such State  without  giving effect to the conflicts of
laws principles thereof.

         11.16.  Counterparts.  This  Agreement may be executed in any number of
counterparts,  each of  which  will be  deemed  an  original,  but all of  which
together will constitute one and the same instrument.
IN WITNESS WHEREOF,  this Agreement has been duly executed and delivered by each
party hereto as of the date first above written.

                                               SELLERS:

                                               By: /s/  ROBERT J. BANKS
                                               Robert J. Banks

                                               By: /s/  KEITH J. GLOECKL
                                               Keith J. Gloeckl

                                               By: /s/  RAY F. MATHIS
                                               Ray F. Mathis

                                               PURCHASER:

                                               MUNICIPAL MORTGAGE & EQUITY, LLC

                                               By:  /S/  MICHAEL L. FALCONE
                                               Michael L. Falcone
                                               President and COO
PRESS RELEASE                    Contact:          Derek K. Cole
                                                   Director, Investor Relations
EMBARGOED UNTIL                                    (888) 788-3863
4:30pm, October 4, 1999

                 MuniMae Agrees to Acquire the Midland Companies
                   --------------------------------------
                   Combined Companies Will Manage $1.7 Billion
              of Multifamily Real Estate Debt & Equity Investments

BALTIMORE,  MD, October 4, 1999 -- Municipal Mortgage & Equity, LLC (NYSE: MMA),
also known as  MuniMae,  a  nationwide  originator,  investor  and  servicer  of
tax-exempt  multifamily  housing  bonds,  announced  today  that it has signed a
binding  agreement to purchase the Midland  Companies  ("Midland"),  a privately
held Fannie Mae lender that originates,  services and asset manages  investments
in multifamily debt and equity on behalf of institutional  investors and for its
own account.  The $45 million  cash-and-stock  transaction  is expected to close
over the next several weeks.

The combined  companies  will manage $1.7 billion of  investments in multifamily
real estate debt and equity. A portfolio of 557 multifamily housing communities,
encompassing  51,926 apartment units in 45 states,  the District of Columbia and
the U.S. Virgin Islands secures the investments.

Midland,  headquartered  in Clearwater,  Florida with offices in Dallas,  Texas,
Detroit, Michigan, Portland, Oregon and San Francisco, California, will continue
to operate under the Midland name. Midland is a Fannie Mae delegated underwriter
and servicer  (DUS),  that manages  construction  and permanent loans as well as
equity  investments  on behalf of its pension  fund  investors,  and also raises
equity from corporations for investments in the federal  affordable  housing tax
credit program.

MuniMae  Chairman  and CEO,  Mark K. Joseph,  commented,  "We believe this is an
excellent  opportunity for MuniMae.  It is a natural  extension of our business.
Acquiring the Midland  Companies  greatly  expands our reach in the  multifamily
finance marketplace.  As one of only three Fannie Mae DUS lenders in the country
which  provides  equity  financing  in  addition  to Fannie Mae debt  financing,
Midland brings MuniMae access to important additional capital resources.  Fannie
Mae is the largest  provider  of capital for housing in the nation.  To join the
Fannie Mae family of lenders opens up new paths of growth for us. Further,  with
Midland's experienced team of loan originators in geographically  diverse areas,
MuniMae will be able to better serve existing  customers and extend our customer
base nationally.  By creating a stronger,  more dynamic  national  organization,
this acquisition will enhance long-term value creation for our shareholders.

We will continue our low leverage  approach to the  multifamily  housing finance
business.  We will  continue to increase  our core  holdings of tax exempt bonds
secured  by  apartment  communities.  We expect  that,  with this  acquisition's
addition to our Cash Available for  Distribution  ("CAD"),  we can not only grow
our tax  exempt  dividend,  but also  lower  our  payout  ratio,  measured  on a
recurring income basis.  Achieving this will both grow MuniMae strategically and
increase the security of the dividend payments to our shareholders."

Midland,  which  includes a holding  company and six operating  companies,  will
become a wholly owned subsidiary of MuniMae. Midland Chairman and CEO, Robert J.
Banks, who will join the MuniMae Board of Directors,  commented, "I am extremely
pleased  to be  joining  MuniMae  as they  seek new  growth  opportunities.  Our
approach to business and our dedication to our customers will remain  unchanged.
We will continue to operate all of our  businesses  under the Midland name,  and
most  importantly,  the quality people at Midland who have built our business to
date will  continue on. The merger was a natural  progression  for Midland.  The
larger equity base and the  additional  access to capital will enable us to grow
and compete more aggressively.  Since 1977, we have originated in excess of $2.6
billion in financing for multifamily  housing involving over 1,300 properties in
48 states.  With the similar business  philosophies and cultures between Midland
and MuniMae,  and with the capital  resources now available to us, we anticipate
an even greater  ability to serve our  customers  needs,  to provide  growth and
challenge for our employees and to enhance shareholder value."

MuniMae President and COO, Michael L. Falcone, commented, "We expect the Midland
transaction to be accretive to CAD per share in 2000.  Further, it will increase
the  percentage of income to  shareholders  which is exempt from Federal  income
taxes.  Managing over $1.7 billion of investments in real estate debt and equity
begins to give us economies of scale that we could not  previously  obtain.  The
addition of the Midland  product line will enable us to capture a larger  volume
of deals,  while enabling Midland to aggressively  offer  additional  tax-exempt
financing  alternatives  to its  customers.  Everyone  at MuniMae and Midland is
excited about the future for our customers, our employees and our shareholders."

MuniMae has agreed to pay $45 million for Midland. At closing,  $23 million will
be paid in cash and $12 million in stock.  Assuming certain  performance targets
are met,  including an annual  contribution  to CAD of at least $6 million,  $10
million in additional stock will be paid over the next three years.

MuniMae  originates,  invests in and  services  tax-exempt  multifamily  housing
bonds. The 76 multifamily  housing  communities that secure MuniMae's  portfolio
are located in 38 markets in 18 states and the District of Columbia, and contain
18,767  units  with an  average  occupancy  of  94%.  The  properties  represent
approximately  $750 million in real estate  value.  Over half of MuniMae's  bond
assets  provide  for the  Company  to  participate  in the  appreciation  of the
underlying   apartments  on  a  tax-exempt  basis  through  contingent  interest
payments.

MuniMae is organized as a limited liability company,  which makes it exempt from
tax at the corporate level and provides the benefit of corporate governance.  In
addition,  the Company passes through to its shareholders  primarily  tax-exempt
dividends,  which are generated by its municipal bond investments.  Dividends to
shareholders  are  declared  quarterly  and paid in  February,  May,  August and
November.

The comments of MuniMae  Chairman  Joseph,  Midland  Chairman  Banks and MuniMae
President  Falcone  contain  statements  that are forward  looking in nature and
reflect  management's  current views with respect to future events and financial
performance.  These statements are subject to many  uncertainties  and risks and
should not be considered  guarantees of future  performance.  Actual results may
vary materially from projected  results based on a number of factors,  including
the  actual  performance  of  the  properties  pledged  as  collateral  for  the
portfolio,  general  conditions  in the local real  estate  markets in which the
properties are located and prevailing interest rates.

             MUNIMAE: TAX-EXEMPT DIVIDENDS AND GROWTH THROUGH REAL ESTATE
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