SUMMIT TAX EXEMPT L P II, SC 14D1, 1997-04-24

SUMMIT TAX EXEMPT L P II
SC 14D1, 1997-04-24
ASSET-BACKED SECURITIES

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------

SCHEDULE 14D-1
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
-----------------------

SUMMIT TAX EXEMPT L.P. II
(Name of Subject Company)

PREVIOUSLY OWNED PARTNERSHIPS INCOME FUND II, L.P.;
ACCELERATED HIGH YIELD INSTITUTIONAL FUND 1, L.P.;
SPECIFIED INCOME FUND, L.P.
MP INCOME FUND 11, L.P.
MACKENZIE PATTERSON SPECIAL FUND
PAT PATTERSON WESTERN SECURITIES, INC. PROFIT SHARING PLAN
JDF & ASSOCIATES, LLC; STEVEN GOLD; MORAGA GOLD, LLC; AND
CAL KAN, INC.

(Bidders)

BENEFICIAL UNIT CERTIFICATES
(Title of Class of Securities)

NONE
(CUSIP Number of Class of Securities)
-----------------------

Copy to:
C.E. Patterson Paul J. Derenthal, Esq.
MacKenzie Patterson, Inc. Derenthal & Dannhauser
1640 School Street, Suite 100 455 Market Street, Suite 1600
Moraga, California 94556 San Francisco, California 94105
(510) 631-9100 (415) 243-8070

(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications on Behalf of Bidder)

* For purposes of calculating the filing fee only. This amount assumes the
purchase of 177,500 Beneficial Unit Certificates ("Units") of the subject
company at $10.50 in cash per Unit.

[ ] Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee
was previously paid. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.

Amount Previously Paid:
Form or Registration Number:
Filing Party:
Date Filed:

<PAGE>

CUSIP NO. None 14D-1 Page 2 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

PREVIOUSLY OWNED PARTNERSHIPS INCOME FUND II, L.P.

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e)or2(f)

--
6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See
Instructions)

--
9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

summit01/14dapr23.1

<PAGE>

CUSIP NO. None 14D-1 Page 3 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

ACCELERATED HIGH YIELD INSTITUTIONAL FUND 1, L.P.

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

Florida

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 4 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

CAL KAN, INC.

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

Kansas

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares
(See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 5 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

PAT PATTERSON WESTERN SECURITIES, INC. PROFIT SHARING PLAN

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 6 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

SPECIFIED INCOME FUND, L.P.

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 7 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

MP INCOME FUND 11, L.P.

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 8 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

MACKENZIE PATTERSON SPECIAL FUND

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 9 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

JDF & ASSOCIATES, LLC

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

Texas

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7)Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 10 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

MORAGA GOLD, LLC

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares(See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

CUSIP NO. None 14D-1 Page 11 of ___ Pages

1. Name of Reporting Person
S.S. or I.R.S. Identification Nos. of Above Person

STEVEN GOLD

2. Check the Appropriate Box if a Member of a Group
(See Instructions)

(a) __
(b) x

3. SEC Use Only

4. Sources of Funds (See Instructions)

5. Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(e) or 2(f)
--

6. Citizenship or Place of Organization

California

7. Aggregate Amount Beneficially Owned by Each Reporting Person 0

8. Check if the Aggregate in Row (7) Excludes Certain Shares (See Instructions)

9. Percent of Class Represented by Amount in Row (7) 0%

10. Type of Reporting Person (See Instructions)

<PAGE>

Item 1. Security and Subject Company.

(a) This Schedule relates to Beneficial Unit Certificates (the "Units") of
Summit Tax Exempt, L.P. II (the "Issuer"), the subject company. The address of
the Issuer's principal executive offices is: 625 Madison Avenue, New York, New
York 10022.

(b) This Schedule relates to the offer by Previously Owned Partnerships
Income Fund II, L.P., Accelerated High Yield Institutional Fund 1, L.P.,
Specified Income Fund, L.P., MP Income Fund 11, L.P., MacKenzie Patterson
Special Fund, Pat Patterson Western Securities, Inc. Profit Sharing Plan, JDF &
Associates, LLC, Steven Gold, Moraga Gold, LLC, and Cal Kan, Inc. (collectively
the "Purchasers"), to purchase up to 177,500 Units for cash at a price equal to
$10.50 per Unit less the amount of any distributions made or declared with
respect to the Units between April 24, 1997 and May 23, 1997, or such later date
to which the Purchasers may extend the offer, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated April 24, 1997 (the "Offer
to Purchase") and the related Letter of Transmittal, copies of which are
attached hereto as Exhibits (a)(1) and (a)(2), respectively. The Issuer had
9,151,620 Units outstanding as of December 31, 1996, according to its annual
report on Form 10-K for the year then ended.

(c) The information set forth under the captions "Introduction -
Establishment of the Offer Price" and "Effects of the Offer" in the Offer to
Purchase is incorporated herein by reference.

Item 2. Identity and Background.

(a)-(d) The information set forth in "Introduction," "Certain Information
Concerning the Purchasers" and in Schedule I of the Offer to Purchase is
incorporated herein by reference.

(e)-(g) The information set forth in "Certain Information Concerning the
Purchasers" and Schedule I in the Offer to Purchase is incorporated herein by
reference. To the best of the knowledge of the Purchasers, no person named on
Schedule I to the Offer to Purchaser nor any affiliate of the Purchasers (i) has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) was a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
were or are subject to a judgment, decree or final order enjoining future
violations of, or prohibiting activities subject to, Federal or state securities
laws or finding any violation of such laws.

Item 3. Past Contacts, Transactions or Negotiations with the Subject Company.

(a)-(b) See the Offer to Purchase for information concerning recent
purchases of Units by affiliates of certain of the Purchasers. Other than the
foregoing, since January 1, 1993, there have been no transactions between any of
the persons identified in Item 2 and the Issuer or, to the knowledge of the
Purchaser, any of the Issuer's affiliates or general partners, or any directors
or executive officers of any such affiliates or general partners.

Item 4. Source and Amount of Funds or Other Consideration.

(a) The information set forth under the caption "Source of Funds" of the
Offer to Purchase is incorporated herein by reference.

(b)-(c) Not applicable.

<PAGE>

Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidder.

(a)-(e) and (g) The information set forth under the caption "Future Plans"
in the Offer to Purchase is incorporated herein by reference.

(f) Not applicable.

Item 6. Interest in Securities of the Subject Company.

(a) and (b) The information set forth in "Certain Information Concerning
the Purchasers" of the Offer to Purchase is incorporated herein by reference.

Item 7. Contracts, Arrangements, Understandings or Relationships with
Respect to the Subject Company's Securities.

The information set forth in "Certain Information Concerning the
Purchasers" of the Offer to Purchase is incorporated herein by reference.

Item 8. Persons Retained, Employed or To Be Compensated.

None.

Item 9. Financial Statements of Certain Bidders.

Not applicable.

Item 10. Additional Information.

(a) None.

(b)-(c) The information set forth in "Certain Legal Matters" of the
Offer to Purchase is incorporated herein by reference.

(d) None.

(e) None.

(f) Reference is hereby made to the Offer to Purchase and the
related Letter of Transmittal, copies of which are attached hereto as Exhibits
(a)(1) and (a)(2), respectively, and which are incorporated herein in their
entirety by reference.

Item 11. Material to be Filed as Exhibits.

(a)(1) Offer to Purchase dated March 24, 1997

(a)(2) Letter of Transmittal.

<PAGE>

(a)(3) Form of Letter to Unitholders dated March 24, 1997

(a)(4) Advertisement dated March 24, 1997

(b)-(f) Not applicable.

<PAGE>

SIGNATURES

After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.

Dated: March 24, 1997

PREVIOUSLY OWNED PARTNERSHIPS INCOME FUND II, L.P.;

By MacKenzie Patterson, Inc., General Partner

By: /s/ Victoriaan Tacheira
Victoriaann Tacheira, Senior Vice President

SPECIFIED INCOME FUND, L.P.

By MacKenzie Patterson, Inc., General Partner

By: /s/ Victoriaann Tacheira
Victoriaann Tacheira, Senior Vice President

PAT PATTERSON WESTERN SECURITIES, INC. PROFIT SHARING PLAN

By: /s/ C. E. Patterson
C. E. Patterson, Trustee

ACCELERATED HIGH YIELD INSTITUTIONAL FUND 1, L.P.

By MacKenzie Patterson, Inc., General Partner

By: /s/ Victoriaann Tacheira
Victoriaann Tacheira, Senior Vice President

CAL KAN, INC.

By: /s/ C. E. Patterson
C. E. Patterson, President

MP INCOME FUND 11, L.P.

By MacKenzie Patterson, Inc., General Partner

By: /s/ Victoriaann Tacheira
Victoriaann Tacheira, Senior Vice President

MACKENZIE PATTERSON SPECIAL FUND

By MacKenzie Patterson, Inc., General Partner

By: /s/ Victoriaann Tacheira
Victoriaann Tacheira, Senior Vice President

<PAGE>

JDF & ASSOCIATES, LLC

By: /s/ J. David Frantz
J. David Frantz, General Manager

/s/ Steven Gold
STEVEN GOLD

MORAGA GOLD, LLC

By Moraga Partners, Inc., Managing Member

By: /s/ C. E. Patterson
C.E. Patterson, President

<PAGE>

EXHIBIT INDEX

Exhibit Description Page

(a)(1) Offer to Purchase dated March 24, 1997

(a)(2) Letter of Transmittal.

(a)(3) Form of Letter to Unitholders dated March 24, 1997

(a)(4) Advertisement dated March 24, 1997

<PAGE>

Exhibit (a)(1)
<PAGE>
OFFER TO PURCHASE FOR CASH UP TO 177,500
BENEFICIAL UNIT CERTIFICATES ("UNITS")

SUMMIT TAX EXEMPT L.P. II
A Delaware Limited Partnership

$10.50 PER UNIT

THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT 12:00 MIDNIGHT,
PACIFIC DAYLIGHT TIME, ON MAY 23, 1997, UNLESS THE OFFER IS EXTENDED.

Previously Owned Partnerships Income Fund II, L.P., Accelerated High Yield
Institutional Fund 1, L.P., Specified Income Fund, L.P., MP Income Fund 11,
L.P., MacKenzie Patterson Special Fund, Pat Patterson Western Securities, Inc.
Profit Sharing Plan, JDF & Associates, LLC, Steven Gold, Moraga Gold, LLC, and
Cal Kan, Inc. (collectively the "Purchasers") hereby seek to acquire Beneficial
Unit Certificates (the "Units") in Summit Tax Exempt L.P. II, a Delaware limited
partnership (the "Partnership"). The Purchasers are not affiliated with the
Partnership or its general partners. The Purchasers hereby offer to purchase up
to 177,500 Units at a purchase price equal to $10.50 per Unit, less the amount
of any distributions declared or made with respect to the Units between April
24, 1997 (the "Offer Date") and May 23, 1997, or such other date to which this
Offer may be extended (the "Expiration Date"), in cash, without interest, upon
the terms and subject to the conditions set forth in this Offer to Purchase (the
"Offer to Purchase") and in the related Letter of Transmittal, as each may be
supplemented or amended from time to time (which together constitute the
"Offer"). The 177,500 Units sought pursuant to the Offer represent approximately
2% of the Units outstanding as of December 31, 1996.

Holders of Units ("Unitholders") are urged to consider the following factors:

-Unitholders who tender their Units will give up the
opportunity to participate in any future benefits from the
ownership of Units, including potential future distributions
by the Partnership, and the purchase price per Unit payable to
a tendering Unitholder by the Purchasers may be less than the
total amount which might otherwise be received by the
Unitholder with respect to the Unit over the remaining term of
the Partnership.

-The purchase price offered by the Purchasers is less than the
$10.56 per Unit estimated by the Purchasers to be the
estimated liquidation value of the underlying assets of the
Partnership as of December 31, 1996, and less than the $11.85
per Unit estimated by the General Partners to be the value of
the Units for ERISA valuation purposes in response to oral
inquiries in March 1997.

<PAGE>

-The Purchasers are making the Offer for investment purposes
and with the intention of making a profit from the ownership
of the Units. In establishing the purchase price of $10.50 per
Unit, the Purchasers are motivated to establish the lowest
price which might be acceptable to Unitholders consistent with
the Purchasers' objectives.

-The Purchasers may accept only a portion of the Units
tendered by a Unitholder in the event a total of more than
177,500 Units are tendered.

THE OFFER TO PURCHASE IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF UNITS BEING
TENDERED. IF MORE THAN 177,500 UNITS ARE VALIDLY TENDERED AND NOT WITHDRAWN, THE
PURCHASERS WILL ACCEPT FOR PURCHASE 177,500 UNITS FROM TENDERING UNITHOLDERS ON
A PRO RATA BASIS, SUBJECT TO THE TERMS AND CONDITIONS HEREIN.

A UNITHOLDER MAY TENDER ANY OR ALL UNITS OWNED BY SUCH UNITHOLDER.

The Purchasers expressly reserve the right, in their sole discretion, at any
time and from time to time, (i) to extend the period of time during which the
Offer is open and thereby delay acceptance for payment of, and the payment for,
any Units, (ii) to terminate the Offer and not accept for payment any Units not
theretofore accepted for payment or paid for, (iii) upon the occurrence of any
of the conditions specified in Section 13 of this Offer to Purchase, to delay
the acceptance for payment of, or payment for, any Units not theretofore
accepted for payment or paid for, and (iv) to amend the Offer in any respect.
Notice of any such extension, termination or amendment will promptly be
disseminated to Unitholders in a manner reasonably designed to inform
Unitholders of such change in compliance with Rule 14d-4(c) under the Securities
Exchange Act of 1934 (the "Exchange Act"). In the case of an extension of the
Offer, such extension will be followed by a press release or public announcement
which will be issued no later than 9:00 a.m., Eastern Standard Time, on the next
business day after the scheduled Expiration Date, in accordance with Rule
14e-1(d) under the Exchange Act.

April 24, 1997

2
Summit01/ste2to.1

<PAGE>

IMPORTANT

Any Unitholder desiring to tender any or all of such Unitholder's Units should
complete and sign the Letter of Transmittal (a copy of which is printed on green
paper and enclosed with this Offer to Purchase) in accordance with the
instructions in the Letter of Transmittal and mail, deliver or telecopy the
Letter of Transmittal and any other required documents to MacKenzie Patterson,
Inc. (the "Depositary"), an affiliate of certain of the Purchasers, at the
address or facsimile number set forth below.

MacKenzie Patterson, Inc.
1640 School Street, Suite 100
Moraga, California 94556
Telephone: 510-631-9100
Facsimile Transmission: 510-631-9119

Questions or requests for assistance or additional copies of this Offer to
Purchase or the Letter of Transmittal may be directed to the Purchasers at
1-510-631-9100.

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

NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION OR ANY
REPRESENTATION ON BEHALF OF THE PURCHASERS OR TO PROVIDE ANY INFORMATION OTHER
THAN AS CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL. NO SUCH
RECOMMENDATION, INFORMATION OR REPRESENTATION MAY BE RELIED UPON AS HAVING BEEN
AUTHORIZED.
---------------------------

The Partnership is subject to the information and reporting
requirements of the Exchange Act and in accordance therewith is required to file
reports and other information with the Commission relating to its business,
financial condition and other matters. Such reports and other information may be
inspected at the public reference facilities maintained by the Commission at
Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
is available for inspection and copying at the regional offices of the
Commission located in Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661 and at 7 World Trade Center, 13th Floor, New York,
New York 10048. Copies of such material can also be obtained from the Public
Reference Room of the Commission in Washington, D.C. at prescribed rates.

The Purchasers have filed with the Commission a Tender Offer Statement
on Schedule 14D-1 (including exhibits) pursuant to Rule 14d-3 of the General
Rules and Regulations under the Exchange Act, furnishing certain additional
information with respect to the Offer. Such statement and any amendments
thereto, including exhibits, may be inspected and copies may be obtained from
the offices of the Commission in the manner specified above.

3
Summit01/ste2to.1

<PAGE>

TABLE OF CONTENTS

Page

INTRODUCTION 5

TENDER OFFER 8
Section 1. Terms of the Offer..........................................8
Section 2. Proration; Acceptance for Payment and Payment for Units.....8
Section 3. Procedures for Tendering Units..............................9
Section 4. Withdrawal Rights...........................................10
Section 5. Extension of Tender Period; Termination; Amendment..........11
Section 6. Certain Federal Income Tax Consequences.....................12
Section 7. Effects of the Offer........................................13
Section 8. Future Plans................................................14
Section 9. The Business of the Partnership.............................14
Section 10. Conflicts of Interest.......................................15
Section 11. Certain Information Concerning the Purchasers...............15
Section 12. Source of Funds.............................................16
Section 13. Conditions of the Offer.....................................16
Section 14. Certain Legal Matters.......................................17
Section 15. Fees and Expenses...........................................18
Section 16. Miscellaneous...............................................18

Schedule I - The Purchasers and Their Respective Principals

<PAGE>

To the Holders of Beneficial Unit Certificates
of Summit Tax Exempt L.P. II

INTRODUCTION

The Purchasers hereby offer to purchase up to 177,500 Units at a
purchase price of $10.50 per Unit, less the amount of any distributions declared
or paid with respect to the Units between the Offer Date and the Expiration Date
("Offer Price"), in cash, without interest, upon the terms and subject to the
conditions set forth in the Offer. Unitholders who tender their Units will not
be obligated to pay any Partnership transfer fees, or any other fees, expenses
or commissions in connection with the tender of Units. The Purchasers will pay
all such costs and all charges and expenses of the Depositary, an affiliate of
certain of the Purchasers, as depositary in connection with the Offer.

For further information concerning the Purchasers, see Section 11 below
and Schedule I.

None of the Purchasers is affiliated with Related Tax Exempt Associates II,
Inc. or Prudential-Bache Properties, Inc., the Partnership's general partners
(the "General Partners") or with any affiliate of such persons.

Unitholders are urged to consider the following factors:

- Unitholders who tender their Units will give up the opportunity to
participate in any future benefits from the ownership of Units,
including potential future distributions by the Partnership, and the
purchase price per Unit payable to a tendering Unitholder by the
Purchasers may be less than the total amount which might otherwise be
received by the Unitholder with respect to the Unit over the remaining
term of the Partnership.

- The purchase price offered by the Purchasers is less than the $10.56
per Unit estimated by the Purchasers to be the estimated liquidation
value of the underlying assets of the Partnership as of December 31,
1996, and less than the $11.85 per Unit estimated by the General
Partners to be the value of the Units for ERISA valuation purposes in
response to oral inquiries in March 1997.

- The Purchasers are making the Offer for investment purposes and with
the intention of making a profit from the ownership of the Units. In
establishing the purchase price of $10.50 per Unit, the Purchasers are
motivated to establish the lowest price which might be acceptable to
Unitholders consistent with the Purchasers' objectives.

- The Purchasers may accept only a portion of the Units tendered by a
Unitholder in the event a total of more than 177,500 Units are
tendered.

The Offer will provide Unitholders with an opportunity to liquidate their
investment without the usual transaction costs associated with market sales.
Unitholders may no longer wish to continue with their investment in the
Partnership for a number of reasons, including the following:

- the absence of a formal trading market for the Units and the
difficulty in selling units in secondary market transactions;

- general disenchantment with real estate investments, particularly
long-term investments in limited partnerships;

- the General Partners have disclosed that a proposed settlement of a
class action lawsuit against a General Partner relating to the Partnership
contemplates, among other things, the reorganization of the

<PAGE>

Partnership and two other related partnerships. One result of this
proposed reorganization would be to increase potential liquidity for
Unitholders. However, the proposed settlement is subject to a number of
contingencies and there can be no assurance as to whether or when a
final settlement agreement will be approved by the court and all
involved parties. Furthermore, there can be no assurance as to the
value of the Units in the proposed reorganization or as to the prices
at which the Units will trade if and when a substantial volume of Units
become available on the market.

- a more immediate need to use the cash now tied up in an investment
in the Units;

- a desire to eliminate the need for compliance with complicated and
costly tax return requirements and associated expenses which may result
from an investment in the Units; and

- no termination or liquidation date has been fixed for the Partnership
other than the Partnership Agreement provision for the term of the
Partnership to extend until December 31, 2020 (unless dissolved
earlier). The Partnership's mortgage bond investments are expected to
be held at least through 2001, though the bonds may be held to
maturity, which, according to the General Partners, may extend beyond
the year 2007.

The Offer is not conditioned upon any minimum number of Units being
tendered. If more than 177,500 Units are validly tendered and not withdrawn, the
Purchasers will accept for purchase a total 177,500 Units from tendering
Unitholders on a pro rata basis, subject to the terms and conditions herein. See
"Tender Offer - Section 13. Conditions of the Offer" for certain conditions of
the Offer. The Purchasers expressly reserve the right, in their sole discretion
and for any reason, to waive any or all of the conditions of the Offer, although
the Purchasers do not presently intend to waive any such conditions.

Establishment of the Offer Price

The Purchasers have set the Offer Price at $10.50 per Unit, less the
amount of any distributions declared or made with respect to the Units between
the Offer Date and Expiration Date. In determining the Offer Price, the
Purchasers analyzed a number of quantitative and qualitative factors, including:
(i) the prices of recent secondary market resales of the Units; (ii) the lack of
liquidity of an investment in the Partnership; (iii) the Purchasers' estimate of
the potential liquidation value of the Partnership's assets and the General
Partners' estimate of the current value of the Units; and (iv) the costs to the
Purchasers associated with acquiring the Units.

The Offer Price represents the price at which the Purchasers are
willing to purchase Units. No independent person has been retained to evaluate
or render any opinion with respect to the fairness of the Offer Price and no
representation is made by the Purchasers or any affiliate of the Purchasers as
to such fairness. Other measures of the value of the Units may be relevant to
Unitholders. Unitholders are urged to consider carefully all of the information
contained herein and consult with their own advisors, tax, financial or
otherwise, in evaluating the terms of the Offer before deciding whether to
tender Units.

According to reports published by Robert A. Stanger & Co., Inc. and
Partnership Spectrum, independent, third-party sources, the low and high sales
prices of Units during the period from December 1, 1996 through January 31,
1997, were $10.50 and $12.55 per Unit, respectively. In response to a telephone
inquiry to representatives of the General Partners, affiliates of the Purchasers
were advised that the General Partners estimated the value of the Units to be
$11.85 per Unit as of December 31, 1996 for purposes of portfolio valuation by
ERISA fiduciaries. The market prices and, the Purchasers believe, the General
Partners' ERISA valuations, reflect gross sales prices for the Units. Gross
sales prices do not reflect the net sales proceeds received by sellers of Units,
which typically are reduced by commissions and other secondary market
transaction costs to amounts less than the reported prices. In addition, the
information published by the independent sources is the product of their market
research and does not constitute the comprehensive

<PAGE>

transaction reporting of a securities exchange. Accordingly, the Purchasers do
not know whether the foregoing sales price information is accurate or complete.

During the period from August 1996 through October 1996, affiliates of the
Purchasers acquired a total of 38,965 Units in individual privately negotiated
transactions with total acquisition costs (including all commissions, fees and
expenses incurred in connection with the acquisitions) ranging from $11.32 per
Unit to $11.95 per Unit, with an average gross price of $11.62 per Unit.

The Purchasers are offering to purchase Units which are a relatively illiquid
investment and are not offering to purchase the Partnership's underlying assets.
Consequently, the Purchasers do not believe that the underlying asset value of
the Partnership is determinative in arriving at the Offer Price. Nevertheless,
using publicly available information concerning the Partnership contained in the
Partnership's Form 10-K for the fiscal year ended December 31, 1996, the
Purchasers used an estimated asset value to derive an estimated market value for
the Units solely for purposes of formulating their Offer.

In determining their estimated value of the Units, the Purchasers first
calculated the estimated current value of the Partnership's mortgage bonds. The
value of the bonds is set forth in the Partnership's financial statements based
on "the present value of its expected cash flows using a discount rate for
comparable tax exempt investments." The Purchasers believe that a "comparable
rate" of discount used for financial reporting purposes was likely approximately
6.5% (though the Purchasers can only speculate as to the actual rate used).
Because of the highly illiquid nature of the Units, the provisions of the
Partnership Agreement and other factors, including the proposed reorganization
pursuant to the class action settlement agreement, the Purchasers believe a
discount rate of approximately 11% is more appropriate for the Purchasers'
valuation of the Units themselves. The resulting discounted value of the
Partnership's mortgage bonds was added to the Partnership's net current assets
and the Partnership's total estimated asset value was then reduced by the
Purchasers' estimate of the hypothetical costs to liquidate the portfolio plus
the Purchasers' estimated gross acquisition and transfer costs. The Purchasers'
resulting estimated current value per Unit is $10.56.

Under the Partnership Agreement, the Partnership is not required to sell its
mortgage bond investments prior to maturity or until the earlier of the date
Unitholders holding a majority of the Units vote to liquidate the Partnership or
December 31, 2020.

As indicated above, the Offer Price represents the price at which the Purchasers
are willing to purchase Units. No independent person has been retained to
evaluate or render any opinion with respect to the fairness of the Offer Price
and no representation is made by the Purchasers or any affiliate of the
Purchasers as to such fairness. Other measures of the value of the Units may be
relevant to Unitholders. Unitholders are urged to consider carefully all of the
information contained herein and consult with their own advisors, tax, financial
or otherwise, in evaluating the terms of the Offer before deciding whether to
tender Units.

General Background Information

Certain information contained in this Offer to Purchase which relates to, or
represents, statements made by the Partnership or the General Partner, has been
derived from information provided in reports filed by the Partnership with the
Securities and Exchange Commission.

According to publicly available information, there were 9,151,620 Units issued
and outstanding at December 31, 1996, held by approximately 9,161 Unitholders.
None of the Purchasers is currently a holder of any Units. Certain affiliates of
the Purchasers currently beneficially own an aggregate of 38,965 Units or
approximately 0.4% of the outstanding Units (see "Certain Information Concerning
the Purchasers" below).

Tendering Unitholders will not be obligated to pay transfer fees, brokerage fees
or commissions on the sale of the Units to the Purchasers pursuant to the Offer.
The Purchasers will pay all charges and expenses

<PAGE>

incurred in connection with the Offer. The Purchasers desire to purchase all
Units tendered by each Unitholder.

If, prior to the Expiration Date, the Purchasers increase the consideration
offered to Unitholders pursuant to the Offer, such increased consideration will
be paid with respect to all Units that are purchased pursuant to the Offer,
whether or not such Units were tendered prior to such increase in consideration.

Unitholders are urged to read this Offer to Purchase and the accompanying Letter
of Transmittal carefully before deciding whether to tender their Units.

TENDER OFFER

Section 1. Terms of the Offer. Upon the terms and subject to the conditions of
the Offer, the Purchasers will accept for payment and pay for Units validly
tendered on or prior to the Expiration Date and not withdrawn in accordance with
Section 4 of this Offer to Purchase. The term "Expiration Date" shall mean 12:00
midnight, Pacific Daylight Time, on May 23, 1997, unless and until the
Purchasers shall have extended the period of time for which the Offer is open,
in which event the term "Expiration Date" shall mean the latest time and date on
which the Offer, as so extended by the Purchasers, shall expire.

The Offer is conditioned on satisfaction of certain conditions. See Section 13,
which sets forth in full the conditions of the Offer. The Purchasers reserve the
right (but shall not be obligated), in their sole discretion and for any reason,
to waive any or all of such conditions. If, by the Expiration Date, any or all
of such conditions have not been satisfied or waived, the Purchasers reserve the
right (but shall not be obligated) to (i) decline to purchase any of the Units
tendered, terminate the Offer and return all tendered Units to tendering
Unitholders, (ii) waive all the unsatisfied conditions and, subject to complying
with applicable rules and regulations of the Commission, purchase all Units
validly tendered, (iii) extend the Offer and, subject to the right of
Unitholders to withdraw Units until the Expiration Date, retain the Units that
have been tendered during the period or periods for which the Offer is extended
or (iv) to amend the Offer.

The Purchasers do not anticipate and has no reason to believe that any condition
or event will occur that would prevent the Purchasers from purchasing tendered
Units as offered herein.

Section 2. Proration; Acceptance for Payment and Payment for Units. If the
number of Units validly tendered prior to the Expiration Date and not withdrawn
is 177,500 or less, the Purchasers, upon the terms and subject to the conditions
of the Offer, will accept for payment all Units so tendered.

If the number of Units validly tendered prior to the Expiration Date and not
withdrawn exceeds 177,500, the Purchasers, upon the terms and subject to the
conditions of the Offer, will accept for payment Units so tendered on a pro rata
basis.

In the event that proration is required, because of the difficulty of
immediately determining the precise number of Units to be accepted, the
Purchasers will announce the final results of proration as soon as practicable,
but in no event later than five business days following the Expiration Date. The
Purchasers will not pay for any Units tendered until after the final proration
factor has been determined.

Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any extension or
amendment), the Purchasers will accept for payment, and will pay for, Units
validly tendered and not withdrawn in accordance with Section 4, as promptly as
practicable following the Expiration Date. In all cases, payment for Units
purchased pursuant to the Offer will be made only after timely receipt by the
Depositary of a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) and any other documents required by the Letter of
Transmittal.

<PAGE>

For purposes of the Offer, the Purchasers shall be deemed to have accepted for
payment (and thereby purchased) tendered Units when, as and if the Purchasers
give oral or written notice to the Depositary of the Purchasers' acceptance for
payment of such Units pursuant to the Offer. Upon the terms and subject to the
conditions of the Offer, payment for Units purchased pursuant to the Offer will
in all cases be made by deposit of the Offer Price with the Depositary, which
will act as agent for the tendering Unitholders for the purpose of receiving
payment from the Purchasers and transmitting payment to tendering Unitholders.

Under no circumstances will interest be paid on the Offer Price by reason of any
delay in making such payment.

If any tendered Units are not purchased for any reason, the Letter of
Transmittal with respect to such Units not purchased will be of no force or
effect. If, for any reason whatsoever, acceptance for payment of, or payment
for, any Units tendered pursuant to the Offer is delayed or the Purchasers are
unable to accept for payment, purchase or pay for Units tendered pursuant to the
Offer, then, without prejudice to the Purchasers' rights under Section 13 (but
subject to compliance with Rule 14e-1(c) under the Exchange Act), the Depositary
may, nevertheless, on behalf of the Purchasers, retain tendered Units, subject
to any limitations of applicable law, and such Units may not be withdrawn except
to the extent that the tendering Unitholders are entitled to withdrawal rights
as described in Section 4.

If, prior to the Expiration Date, the Purchasers shall increase the
consideration offered to Unitholders pursuant to the Offer, such increased
consideration shall be paid for all Units accepted for payment pursuant to the
Offer, whether or not such Units were tendered prior to such increase.

Section 3. Procedures for Tendering Units.

Valid Tender. For Units to be validly tendered pursuant to the Offer, a properly
completed and duly executed Letter of Transmittal (a copy of which is enclosed
and printed on green paper) with any other documents required by the Letter of
Transmittal must be received by the Depositary at its address set forth on the
back cover of this Offer to Purchase on or prior to the Expiration Date. A
Unitholder may tender any or all Units owned by such Unitholder.

In order for a tendering Unitholder to participate in the Offer, Units must be
validly tendered and not withdrawn prior to the Expiration Date, which is 12:00
midnight, Pacific Daylight Time, on May 23, 1997, or such date to which the
Offer may be extended.

The method of delivery of the Letter of Transmittal and all other required
documents is at the option and risk of the tendering Unitholder and delivery
will be deemed made only when actually received by the Depositary.

Backup Federal Income Tax Withholding. To prevent the possible application of
31% backup federal income tax withholding with respect to payment of the Offer
Price for Units purchased pursuant to the Offer, a tendering Unitholder must
provide the Depositary with such Unitholder's correct taxpayer identification
number and make certain certifications that such Unitholder is not subject to
backup federal income tax withholding. Each tendering Unitholder must insert in
the Letter of Transmittal the Unitholder's taxpayer identification number or
social security number in the space provided on the front of the Letter of
Transmittal. The Letter of Transmittal also includes a substitute Form W-9,
which contains the certifications referred to above. (See the Instructions to
the Letter of Transmittal.)

FIRPTA Withholding. To prevent the withholding of federal income tax in an
amount equal to 10% of the sum of the Offer Price plus the amount of Partnership
liabilities allocable to each Unit tendered, each Unitholder must complete the
FIRPTA Affidavit included in the Letter of Transmittal certifying such
Unitholder's taxpayer identification number and address and that the Unitholder
is not a foreign person. (See the Instructions to the Letter of Transmittal and
"Section 6. Certain Federal Income Tax Consequences.")

<PAGE>

Other Requirements. By executing a Letter of Transmittal as set forth above, a
tendering Unitholder irrevocably appoints the designees of the Purchasers as
such Unitholder's proxies, in the manner set forth in the Letter of Transmittal,
each with full power of substitution, to the full extent of such Unitholder's
rights with respect to the Units tendered by such Unitholder and accepted for
payment by the Purchasers. Such appointment will be effective when, and only to
the extent that, the Purchasers accept such Units for payment. Upon such
acceptance for payment, all prior proxies given by such Unitholder with respect
to such Units will, without further action, be revoked, and no subsequent
proxies may be given (and if given will not be effective). The designees of the
Purchasers will, with respect to such Units, be empowered to exercise all voting
and other rights of such Unitholder as they in their sole discretion may deem
proper at any meeting of Unitholders, by written consent or otherwise. In
addition, by executing a Letter of Transmittal, a Unitholder also assigns to the
Purchasers all of the Unitholder's rights to receive distributions from the
Partnership with respect to Units which are accepted for payment and purchased
pursuant to the Offer, other than those distributions declared or paid during
the period commencing on the Offer Date and terminating on the Expiration Date.

Determination of Validity; Rejection of Units; Waiver of Defects; No Obligation
to Give Notice of Defects. All questions as to the validity, form, eligibility
(including time of receipt) and acceptance for payment of any tender of Units
pursuant to the procedures described above will be determined by the Purchasers,
in their sole discretion, which determination shall be final and binding. The
Purchasers reserve the absolute right to reject any or all tenders if not in
proper form or if the acceptance of, or payment for, the absolute right to
reject any or all tenders if not in proper form or if the acceptance of, or
payment for, the Units tendered may, in the opinion of the Purchasers' counsel,
be unlawful. The Purchasers also reserve the right to waive any defect or
irregularity in any tender with respect to any particular Units of any
particular Unitholder, and the Purchasers' interpretation of the terms and
conditions of the Offer (including the Letter of Transmittal and the
Instructions thereto) will be final and binding. Neither the Purchasers, the
Depositary, nor any other person will be under any duty to give notification of
any defects or irregularities in the tender of any Units or will incur any
liability for failure to give any such notification.

A tender of Units pursuant to any of the procedures described above will
constitute a binding agreement between the tendering Unitholder and the
Purchasers upon the terms and subject to the conditions of the Offer, including
the tendering Unitholder's representation and warranty that (i) such Unitholder
owns the Units being tendered within the meaning of Rule 14e-4 under the
Exchange Act and (ii) the tender of such Unit complies with Rule 14e-4. Rule
14e-4 requires, in general, that a tendering security holder actually be able to
deliver the security subject to the tender offer, and is of concern particularly
to any Unitholders who have granted options to sell or purchase the Units, hold
option rights to acquire such securities, maintain "short" positions in the
Units (i.e., have borrowed the Units) or have loaned the Units to a short
seller. Because of the nature of limited partnership interests, the Purchasers
believe it is unlikely that any option trading or short selling activity exists
with respect to the Units. In any event, a Unit holder will be deemed to tender
Units in compliance with Rule 14e-4 and the Offer if the holder is the record
owner of the Units and the holder (i) delivers the Units pursuant to the terms
of the Offer, (ii) causes such delivery to be made, (iii) guarantees such
delivery, (iv) causes a guaranty of such delivery, or (v) uses any other method
permitted in the Offer (such as facsimile delivery of the Transmittal Letter).

Section 4. Withdrawal Rights. Except as otherwise provided in this Section 4,
all tenders of Units pursuant to the Offer are irrevocable, provided that Units
tendered pursuant to the Offer may be withdrawn at any time prior to the
Expiration Date and, unless theretofore accepted for payment as provided in this
Offer to Purchase, may also be withdrawn at any time after June 24, 1997 (or
such later date as may apply in the event the Offer is extended).

For withdrawal to be effective, a written or facsimile transmission notice of
withdrawal must be timely received by the Depositary at the address or the
facsimile number set forth in the attached Letter of Transmittal. Any such
notice of withdrawal must specify the name of the person who tendered the Units
to be withdrawn and

<PAGE>

must be signed by the person(s) who signed the Letter of Transmittal in the same
manner as the Letter of Transmittal was signed.

If purchase of, or payment for, Units is delayed for any reason or if the
Purchasers are unable to purchase or pay for Units for any reason, then, without
prejudice to the Purchasers' rights under the Offer, tendered Units may be
retained by the Depositary on behalf of the Purchasers and may not be withdrawn
except to the extent that tendering Unitholders are entitled to withdrawal
rights as set forth in this Section 4, subject to Rule 14e- 1(c) under the
Exchange Act, which provides that no person who makes a tender offer shall fail
to pay the consideration offered or return the securities deposited by or on
behalf of security holders promptly after the termination or withdrawal of the
tender offer.

All questions as to the form and validity (including time of receipt) of notices
of withdrawal will be determined by the Purchasers, in their sole discretion,
which determination shall be final and binding. Neither the Purchasers, the
Depositary, nor any other person will be under any duty to give notification of
any defects or irregularities in any notice of withdrawal or will incur any
liability for failure to give any such notification.

Any Units properly withdrawn will be deemed not to be validly tendered for
purposes of the Offer. Withdrawn Units may be re-tendered, however, by following
the procedures described in Section 3 at any time prior to the Expiration Date.

Section 5. Extension of Tender Period; Termination; Amendment. The Purchasers
expressly reserve the right, in their sole discretion, at any time and from time
to time, (i) to extend the period of time during which the Offer is open and
thereby delay acceptance for payment of, and the payment for, any Units by
giving oral or written notice of such extension to the Depositary, (ii) to
terminate the Offer and not accept for payment any Units not theretofore
accepted for payment or paid for, by giving oral or written notice of such
termination to the Depositary, (iii) upon the occurrence or failure to occur of
any of the conditions specified in Section 13, to delay the acceptance for
payment of, or payment for, any Units not heretofore accepted for payment or
paid for, by giving oral or written notice of such termination or delay to the
Depositary, and (iv) to amend the Offer in any respect (including, without
limitation, by increasing or decreasing the consideration offered or the number
of Units being sought in the Offer or both or changing the type of
consideration) by giving oral or written notice of such amendment to the
Depositary. Any extension, termination or amendment will be followed as promptly
as practicable by public announcement, the announcement in the case of an
extension to be issued no later than 9:00 a.m., Eastern Standard Time, on the
next business day after the previously scheduled Expiration Date, in accordance
with the public announcement requirement of Rule 14d- 4(c) under the Exchange
Act. Without limiting the manner in which the Purchasers may choose to make any
public announcement, except as provided by applicable law (including Rule
14d-4(c) under the Exchange Act), the Purchasers will have no obligation to
publish, advertise or otherwise communicate any such public announcement, other
than by issuing a release to the Dow Jones News Service. The Purchasers may also
be required by applicable law to disseminate to Unitholders certain information
concerning the extensions of the Offer and any material changes in the terms of
the Offer.

If the Purchasers extend the Offer, or if the Purchasers (whether before or
after its acceptance for payment of Units) are delayed in their payment for
Units or are unable to pay for Units pursuant to the Offer for any reason, then,
without prejudice to the Purchasers' rights under the Offer, the Depositary may
retain tendered Units on behalf of the Purchasers, and such Units may not be
withdrawn except to the extent tendering Unitholders are entitled to withdrawal
rights as described in Section 4. However, the ability of the Purchasers to
delay payment for Units that the Purchasers have accepted for payment is limited
by Rule 14e-1 under the Exchange Act, which requires that the Purchasers pay the
consideration offered or return the securities deposited by or on behalf of
holders of securities promptly after the termination or withdrawal of the Offer.

If the Purchasers make a material change in the terms of the Offer or the
information concerning the Offer or waive a material condition of the Offer, the
Purchasers will extend the Offer to the extent required by Rules 14d-4(c),
14d-6(d) and 14e-1 under the Exchange Act. The minimum period during which an

<PAGE>

offer must remain open following a material change in the terms of the
offer or information concerning the offer, other than a change in price or a
change in percentage of securities sought, will depend upon the facts and
circumstances, including the relative materiality of the change in the terms or
information. With respect to a change in price or a change in percentage of
securities sought (other than an increase of not more than 2% of the securities
sought), however, a minimum ten business day period is generally required to
allow for adequate dissemination to security holders and for investor response.
As used in this Offer to Purchase, "business day" means any day other than a
Saturday, Sunday or a federal holiday, and consists of the time period from
12:01 a.m. through 12:00 midnight, Pacific Daylight Time.

Section 6. Certain Federal Income Tax Consequences. THE FEDERAL INCOME TAX
DISCUSSION SET FORTH BELOW IS INCLUDED HEREIN FOR GENERAL INFORMATION ONLY AND
DOES NOT PURPORT TO ADDRESS ALL ASPECTS OF TAXATION THAT MAY BE RELEVANT TO A
PARTICULAR UNITHOLDER. For example, this discussion does not address the effect
of any applicable foreign, state, local or other tax laws other than federal
income tax laws. Certain Unitholders (including trusts, foreign persons,
tax-exempt organizations or corporations subject to special rules, such as life
insurance companies or S corporations) may be subject to special rules not
discussed below. This discussion is based on the Internal Revenue Code of 1986,
as amended (the "Code"), existing regulations, court decisions and Internal
Revenue Service ("IRS") rulings and other pronouncements. EACH UNITHOLDER
TENDERING UNITS SHOULD CONSULT SUCH UNITHOLDER'S OWN TAX ADVISOR AS TO THE
PARTICULAR TAX CONSEQUENCES TO SUCH UNITHOLDER OF ACCEPTING THE OFFER, INCLUDING
THE APPLICATION OF THE ALTERNATIVE MINIMUM TAX AND FEDERAL, FOREIGN, STATE,
LOCAL AND OTHER TAX LAWS.

The following discussion is based on the assumption that the Partnership is
treated as a partnership for federal income tax purposes and is not a "publicly
traded partnership" as that term is defined in the Code.

Gain or Loss. A taxable Unitholder will recognize a gain or loss on the sale of
such Unitholder's Units in an amount equal to the difference between (i) the
amount realized by such Unitholder on the sale and (ii) such Unitholder's
adjusted tax basis in the Units sold. The amount realized by a Unitholder will
include the Unitholder's share of the Partnership's liabilities, if any (as
determined under Code section 752 and the regulations thereunder). If the
Unitholder reports a loss on the sale, such loss generally could not be
currently deducted by such Unitholder except against such Unitholder's capital
gains from other investments. In addition, such loss would be treated as a
passive activity loss. (See "Suspended Passive Activity Losses" below.)

The adjusted tax basis in the Units of a Unitholder will depend upon individual
circumstances. (See also "Partnership Allocations in Year of Sale" below.) Each
Unitholder who plans to tender hereunder should consult with the Unitholder's
own tax advisor as to the Unitholder's adjusted tax basis in the Unitholder's
Units and the resulting tax consequences of a sale.

If any portion of the amount realized by a Unitholder is attributable to such
Unitholder's share of "unrealized receivables" or "substantially appreciated
inventory items" as defined in Code section 751, a corresponding portion of such
Unitholder's gain or loss will be treated as ordinary gain or loss. It is
possible that the basis allocation rules of Code Section 751 may result in a
Unitholder's recognizing ordinary income with respect to the portion of the
Unitholder's amount realized on the sale of a Unit that is attributable to such
items while recognizing a capital loss with respect to the remainder of the
Unit.

A tax-exempt Unitholder (other than an organization described in Code Section
501(c)(7) (social club), 501(c)(9) (voluntary employee benefit association),
501(c)(17) (supplementary unemployment benefit trust), or 501(c)(20) (qualified
group legal services plan)) should not be required to recognize unrelated trade
or business income upon the sale of its Units pursuant to the Offer, assuming
that such Unitholder does not hold its Units as a "dealer" and has not acquired
such Units with debt financed proceeds.

<PAGE>

Partnership Allocations in Year of Sale. A tendering Unitholder will be
allocated the Unitholder's pro rata share of the annual taxable income and
losses from the Partnership with respect to the Units sold for the period
through the date of sale, even though such Unitholder will assign to the
Purchasers their rights to receive certain cash distributions with respect to
such Units. Such allocations and any Partnership distributions for such period
would affect a Unitholder's adjusted tax basis in the tendered Units and,
therefore, the amount of gain or loss recognized by the Unitholder on the sale
of the Units.

Possible Tax Termination. The Code provides that if 50% or more of the capital
and profits interests in a partnership are sold or exchanged within a single
12-month period, such partnership generally will terminate for federal income
tax purposes. It is possible, although deemed by the Purchasers to be unlikely
(given the limited number of Units subject to the Offer and the limited
secondary market for the Units), that the Partnership could terminate for
federal income tax purposes as a result of consummation of the Offer. If so, the
Partnership will be treated as having made a liquidating distribution of an
undivided interest in all of its assets to the Unitholders, the partners of the
Partnership after consummation of the Offer (i.e., the nontendering Unitholders
and the Purchasers) would be treated as having recontributed their interests in
Partnership assets to the Partnership, and the capital accounts of all partners
would be restated. A Unitholder would recognize gain on the liquidating
distribution only to the extent that the amount of cash deemed distributed to
the Unitholder exceeded the Unitholder's basis in the Units. Depending on the
Unitholders' bases in their Units and the Partnership's tax basis in its
property, a tax termination could affect, perhaps adversely, the amount of
depreciation deductions reported by the Partnership for the period following the
date of such termination. A tax termination of the Partnership also could have
the adverse effect on Unitholders whose tax year is not the calendar year, of
the inclusion of more than one year of Partnership tax items in one tax return
of such Unitholders, resulting in a "bunching" of income. In addition, a tax
termination could have the adverse effect on non-tendering Unitholders who
subsequently dispose of their Units at a gain of requiring them to treat a
greater portion of such gain as ordinary income (due to the application of Code
Section 735) than would otherwise be required absent a tax termination of the
Partnership.

Suspended "Passive Activity Losses". A Unitholder who sells all of the
Unitholder's Units would be able to deduct "suspended" passive activity losses
from the Partnership, if any, in the year of sale free of the passive activity
loss limitation. As a limited partner of the Partnership, which was engaged in
real estate activities, the ability of a Unitholder, who or which is subject to
the passive activity loss rules, to claim tax losses from the Partnership was
limited. Upon sale of all of the Unitholder's Units, such Unitholder would be
able to use any "suspended" passive activity losses first against gain, if any,
on sale of the Unitholder's Units and then against income from any other source.

Foreign Unitholders. Gain realized by a foreign Unitholder on a sale of a Unit
pursuant to the Offer will be subject to federal income tax. Under Section 1445
of the Code, the transferee of a partnership interest held by a foreign person
is generally required to deduct and withhold a tax equal to 10% of the amount
realized on the disposition. The Purchasers will withhold 10% of the amount
realized by a tendering Unitholder from the purchase price payment to be made to
such Unitholder unless the Unitholder properly completes and signs the FIRPTA
Affidavit included as part of the Letter of Transmittal certifying the
Unitholder's TIN, that such Unitholder is not a foreign person and the
Unitholder's address. Amounts withheld would be creditable against a foreign
Unitholder's federal income tax liability and, if in excess thereof, a refund
could be obtained from the Internal Revenue Service by filing a U.S. income tax
return.

Section 7. Effects of the Offer.

Limitations on Resales. The Partnership Agreement does not restrict
transfers of Units, provided a transfer complies with any applicable
federal or state securities or tax laws. The General Partners have
announced that a court order in connection with a proposed settlement of a
class action lawsuit against one of the General Partners and certain of its
affiliates imposes certain restrictions on the rights of members of the
class, including the Unitholders, which, among other things, purport to
limit Unitholders' rights to transfer Units or commence tender offers. The
Purchasers are not members of the class involved

<PAGE>

in the lawsuit, as they are not current Unitholders, and the Purchasers
will agree to be bound by the terms of the proposed settlement with respect to
any Units purchased in connection with this Offer. Accordingly, the Purchasers
believe that transfers pursuant to the terms of the Offer will not conflict with
the court order as described in the Partnership's public reports and do not
anticipate any limitation on their right to acquire the Units, or on the right
and power of the Unitholders to tender their Units in connection with this
Offer.

Effect on Trading Market. There is no established public trading market for the
Units and, therefore, a reduction in the number of Unitholders should not
materially further restrict the Unitholders' ability to find purchasers for
their Units on any secondary market.

Voting Power of Purchasers. Based on the maximum number of Units which may be
acquired by the Purchasers pursuant to the Offer, the Purchasers would not have
the ability to exert any significant influence on matters subject to the vote of
Unitholders.

The Units are registered under the Exchange Act, which requires, among other
things that the Partnership furnish certain information to its Unitholders and
to the Commission and comply with the Commission's proxy rules in connection
with meetings of, and solicitation of consents from, Unitholders. The Purchasers
do not believe that the purchase of Units pursuant to the Offer will result in
the Units becoming eligible for deregistration under the Exchange Act.

Section 8. Future Plans. Following the completion of the Offer, the Purchasers,
or their affiliates, may acquire additional Units. Any such acquisition may be
made through private purchases, or by any other means deemed appropriate. Any
such acquisition may be at a consideration higher or lower than the
consideration to be paid for the Units purchased pursuant to the Offer.

The Purchasers are acquiring the Units pursuant to the Offer solely for
investment purposes. Although the Purchasers have no present intention to seek
control of the Partnership or to change the management or operations of the
Partnership, the Purchasers reserve the right, at an appropriate time, to
exercise their rights as limited partners to vote on matters subject to a
limited partner vote, including a vote to cause the sale of the Partnership's
remaining property and the liquidation and dissolution of the Partnership.

Section 9. The Business of the Partnership. Information included herein
concerning the Partnership is derived from the Partnership's publicly-filed
reports. Additional information concerning the Partnership, its assets,
operations and management is contained in its Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q and other filings with the Securities and
Exchange Commission. Such reports and filings are available for inspection at
the Commission's principal office in Washington, D.C. and at its regional
offices in New York, New York and Chicago, Illinois. The Purchasers expressly
disclaim any responsibility for the information included in such reports and
extracted in this discussion.

The Partnership was organized in 1986 as a Delaware limited partnership for the
purpose of acquiring tax-exempt participating first mortgage revenue bonds
issued by various state and local governments or their agencies or authorities
and secured by first mortgages on multi-family residential real properties. The
Partnership invested its capital in first mortgage bonds secured by 16 real
properties.

Selected Financial Data. Set forth below is a summary of certain financial data
for the Partnership which has been excerpted from the Partnership's Annual
Report on Form 10-K for the year ended December 31, 1996.

<PAGE>

The following table sets forth in comparative tabular form a summary of selected
financial data for each of the Partnership's last five full years:
<TABLE>

Year ended December 31,
1996 1995 1994 1993 1992
---- ---- ---- ---- ----

Interest income from
participating first
<S> <C> <C> <C> <C>
mortgage bonds $ 11,647,431 $ 11,895,439 $ 11,765,112 $ 11,543,922 $ 11,132,119

Loss on impairment
of assets $ 4,000,000 $ 1,000,000 $ 500,000 $ 1,000,000 $0

Net income $ 5,845,041 $ 9,187,803 $ 9,632,049 $ 8,285,673 $ 9,214,047

Net income per Unit $ 0.63 $ 0.98 $ 1.03 $ 0.89 $ 0.99

Total assets $154,896,475 $157,019,314 $157,436,945 $165,778,624 $166,738,439

Total Partners'
Capital $154,322,601 $156,366,964 $164,829,205 $164,918,079 $166,344,329

Distributions to
Unit holders $ 9,517,685 $ 9,517,685 $ 9,517,685 $ 9,517,685 $ 9,536,926

Distributions per Unit $ 1.0400 $ 1.0400 $ 1.0400 $ 1.0400 $ 1.0421
</TABLE>

Section 10. Conflicts of Interest. The Depositary is affiliated with
certain Purchasers. Therefore, by virtue of this affiliation, the Depositary may
have inherent conflicts of interest in acting as Depositary for the Offer.

Section 11. Certain Information Concerning the Purchasers. The
Purchasers are Previously Owned Partnerships Income Fund II, L.P., Accelerated
High Yield Institutional Fund 1, L.P., Specified Income Fund, L.P., MP Income
Fund 11, L.P., MacKenzie Patterson Special Fund, Pat Patterson Western
Securities, Inc. Profit Sharing Plan, JDF & Associates, LLC, Steven Gold, Moraga
Gold, LLC, and Cal Kan, Inc. For information concerning the Purchasers and their
respective principals, please refer to Schedule I attached hereto.

The principal business address of the Purchasers other than JDF &
Associates, LLC and Steven Gold is 1640 School Street, Suite 100, Moraga,
California 94556. The business address of JDF & Associates, LLC is 118 Glynn
Way, Houston, Texas 77056. The business address of Steven Gold is One Maritime
Plaza, Suite 725, San Francisco, California 94111.

The Purchasers have sufficient liquid capital to fund the acquisition
of all Units subject to the Offer, the expenses to be incurred in connection
with the Offer, and all other anticipated costs of the Purchasers. The
Purchasers are not public companies and have not prepared audited financial
statements. The Purchasers, their general partners, owners and members have an
aggregate net worth in excess of $15 million, including net liquid assets of
more than $5 million.

During the period from August 1996 through October 1996, affiliates of
certain of the Purchasers acquired a total of 38,965 Units in individual
privately negotiated transactions with total acquisition costs ranging from
$11.32 per Unit to $11.95 per Unit, with an average price of $11.62 per Unit.
The following entities purchased the following numbers of Units: Previously
Owned Mortgage Partnerships 3, L.P. purchased 13,850 Units, Accelerated High
Yield Institutional Investors, L.P. purchased 20,874 Units and Moraga Fund 1,
L.P. purchased 4,241 Units. The general partner of each of Previously Owned
Mortgage Partnerships 3, L.P. and Accelerated High Yield Institutional
Investors, L.P. is MacKenzie Patterson, Inc., which is also general partner of
certain of the Purchasers, and the general partner of Moraga Fund 1, L.P. is
Moraga Partners, Inc., which is also managing member of one of the Purchasers.
The principal place of business of each of the foregoing Unitholders is 1640
School Street, Suite 100, Moraga, California 94556.

Except as otherwise set forth herein, (i) neither the Purchasers nor,
to the best knowledge of the Purchasers, the persons listed on Schedule I nor
any affiliate of the Purchasers beneficially owns or has a right to acquire

15
<PAGE>

any Units, (ii) neither the Purchasers nor, to the best knowledge of the
Purchasers, the persons listed on Schedule I nor any affiliate of the
Purchasers, or any director, executive officer or subsidiary of any of the
foregoing has effected any transaction in the Units within the past 60 days,
(iii) neither the Purchasers nor, to the best knowledge of the Purchasers, the
persons listed on Schedule I nor any affiliate of the Purchasers has any
contract, arrangement, understanding or relationship with any other person with
respect to any securities of the Partnership, including but not limited to,
contracts, arrangements, understandings or relationships concerning the transfer
or voting thereof, joint ventures, loan or option arrangements, puts or calls,
guarantees of loans, guarantees against loss or the giving or withholding of
proxies, consents or authorizations, (iv) there have been no transactions or
business relationships which would be required to be disclosed under the rules
and regulations of the Commission between any of the Purchasers or, to the best
knowledge of the Purchasers, the persons listed on Schedule I, or any affiliate
of the Purchasers on the one hand, and the Partnership or its affiliates, on the
other hand, and (v) there have been no contracts, negotiations or transactions
between the Purchasers, or to the best knowledge of the Purchasers any affiliate
of the Purchasers on the one hand, the persons listed on Schedule I, and the
Partnership or its affiliates, on the other hand, concerning a merger,
consolidation or acquisition, tender offer or other acquisition of securities,
an election of directors or a sale or other transfer of a material amount of
assets.

Section 12. Source of Funds. The Purchasers expect that approximately
$1,863,750 would be required to purchase 177,500 Units, if tendered, and an
additional $175,000 may be required to pay related fees and expenses. The
Purchasers anticipate funding all of the purchase price and related expenses
through their existing liquid capital reserves.

Section 13. Conditions of the Offer. Notwithstanding any other term of
the Offer, the Purchasers shall not be required to accept for payment or to pay
for any Units tendered if all authorizations, consents, orders or approvals of,
or declarations or filings with, or expirations of waiting periods imposed by,
any court, administrative agency or commission or other governmental authority
or instrumentality, domestic or foreign, necessary for the consummation of the
transactions contemplated by the Offer shall not have been filed, occurred or
been obtained.

The Purchasers shall not be required to accept for payment or pay for
any Units not theretofore accepted for payment or paid for and may terminate or
amend the Offer as to such Units if, at any time on or after the date of the
Offer and before the Expiration Date, any of the following conditions exists:

(a) a preliminary or permanent injunction or other order of any federal
or state court, government or governmental authority or agency shall have been
issued and shall remain in effect which (i) makes illegal, delays or otherwise
directly or indirectly restrains or prohibits the making of the Offer or the
acceptance for payment of or payment for any Units by the Purchasers, (ii)
imposes or confirms limitations on the ability of the Purchasers effectively to
exercise full rights of ownership of any Units, including, without limitation,
the right to vote any Units acquired by the Purchasers pursuant to the Offer or
otherwise on all matters properly presented to the Partnership's Unitholders,
(iii) requires divestiture by the Purchasers of any Units, (iv) causes any
material diminution of the benefits to be derived by the Purchasers as a result
of the transactions contemplated by the Offer or (v) might materially adversely
affect the business, properties, assets, liabilities, financial condition,
operations, results of operations or prospectus of the Purchasers or the
Partnership;

(b) there shall be any action taken, or any statute, rule, regulation
or order proposed, enacted, enforced, promulgated, issued or deemed applicable
to the Offer by any federal or state court, government or governmental authority
or agency, other than the application of the waiting period provisions of the
Hart-ScottRodino Antitrust Improvements Act of 1976, as amended, which might,
directly or indirectly, result in any of the consequences referred to in clauses
(i) through (v) of paragraph (a) above;

(c) any change or development shall have occurred or been threatened
since the date hereof, in the business, properties, assets, liabilities,
financial condition, operations, results of operations or prospects of the
Partnership, which, in the reasonable judgment of the Purchasers, is or may be

<PAGE>

materially adverse to the Partnership, or the Purchasers shall have become
aware of any fact that, in the reasonable judgment of the Purchasers, does or
may have a material adverse effect on the value of the Units;

(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on any national securities exchange or
in the over-the-counter market in the United States, (ii) a declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States, (iii) any limitation by any governmental authority on, or other
event which might affect, the extension of credit by lending institutions or
result in any imposition of currency controls in the United States, (iv) a
commencement of a war or armed hostilities or other national or international
calamity directly or indirectly involving the United States, (v) a material
change in United States or other currency exchange rates or a suspension of a
limitation on the markets thereof, or (vi) in the case of any of the foregoing
existing at the time of the commencement of the Offer, a material acceleration
or worsening thereof; or

(e) it shall have been publicly disclosed or the Purchasers shall have
otherwise learned that (i) more than fifty percent of the outstanding Units have
been or are proposed to be acquired by another person (including a "group"
within the meaning of Section 13(d)(3) of the Exchange Act), or (ii) any person
or group that prior to such date had filed a Statement with the Commission
pursuant to Sections 13(d) or (g) of the Exchange Act has increased or proposes
to increase the number of Units beneficially owned by such person or group as
disclosed in such Statement by two percent or more of the outstanding Units.

The foregoing conditions are for the sole benefit of the Purchasers and
may be asserted by the Purchasers regardless of the circumstances giving rise to
such conditions or may be waived by the Purchasers in whole or in part at any
time and from time to time in their sole discretion. Any termination by the
Purchasers concerning the events described above will be final and binding upon
all parties.

Section 14. Certain Legal Matters.

General. Except as set forth in this Section 14, the Purchasers are not
aware of any filings, approvals or other actions by any domestic or foreign
governmental or administrative agency that would be required prior to the
acquisition of Units by the Purchasers pursuant to the Offer. Should any such
approval or other action be required, it is the Purchasers' present intention
that such additional approval or action would be sought. While there is no
present intent to delay the purchase of Units tendered pursuant to the Offer
pending receipt of any such additional approval or the taking of any such
action, there can be no assurance that any such additional approval or action,
if needed, would be obtained without substantial conditions or that adverse
consequences might not result to the Partnership's business, or that certain
parts of the Partnership's business might not have to be disposed of or held
separate or other substantial conditions complied with in order to obtain such
approval or action, any of which could cause the Purchasers to elect to
terminate the Offer without purchasing Units thereunder. The Purchasers'
obligation to purchase and pay for Units is subject to certain conditions,
including conditions related to the legal matters discussed in this Section 14.

Antitrust. The Purchasers do not believe that the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, is applicable to the acquisition
of Units pursuant to the Offer.

Margin Requirements. The Units are not "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System and,
accordingly, such regulations are not applicable to the Offer.

State Takeover Laws. A number of states have adopted anti-takeover laws
which purport, to varying degrees, to be applicable to attempts to acquire
securities of corporations which are incorporated in such states or which have
substantial assets, security holders, principal executive offices or principal
places of business therein. These laws are directed at the acquisition of
corporations and not partnerships. The Purchasers, therefore, do not believe
that any anti-takeover laws apply to the transactions contemplated by the Offer.

<PAGE>

Although the Purchasers have not attempted to comply with any state
anti-takeover statutes in connection with the Offer, the Purchasers reserve the
right to challenge the validity or applicability of any state law allegedly
applicable to the Offer and nothing in this Offer nor any action taken in
connection herewith is intended as a waiver of such right. If any state
anti-takeover statute is applicable to the Offer, the Purchasers might be unable
to accept for payment or purchase Units tendered pursuant to the Offer or be
delayed in continuing or consummating the Offer. In such case, the Purchasers
may not be obligated to accept for purchase or pay for any Units tendered.

Section 15. Fees and Expenses. The Purchasers have retained MacKenzie
Patterson, Inc., an affiliate of certain Purchasers, to act as Depositary in
connection with the Offer. The Purchasers will pay the Depositary reasonable and
customary compensation for its services in connection with the Offer, plus
reimbursement for out-of-pocket expenses, and will indemnify the Depositary
against certain liabilities and expenses in connection therewith, including
liabilities under the federal securities laws. The Purchasers will also pay all
costs and expenses of printing, publication and mailing of the Offer.

Section 16. Miscellaneous. THE OFFER IS NOT BEING MADE TO (NOR WILL
TENDERS BE ACCEPTED FROM OR ON BEHALF OF) UNITHOLDERS IN ANY JURISDICTION IN
WHICH THE MAKING OF THE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN
COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. THE PURCHASERS ARE NOT AWARE OF
ANY JURISDICTION WITHIN THE UNITED STATES IN WHICH THE MAKING OF THE OFFER OR
THE ACCEPTANCE THEREOF WOULD BE ILLEGAL.

No person has been authorized to give any information or to make any
representation on behalf of the Purchasers not contained herein or in the Letter
of Transmittal and, if given or made, such information or representation must
not be relied upon as having been authorized.

April 24, 1997

PREVIOUSLY OWNED PARTNERSHIPS INCOME FUND II, L.P.
ACCELERATED HIGH YIELD INSTITUTIONAL FUND 1, L.P.
SPECIFIED INCOME FUND, L.P.
MP INCOME FUND 11, L.P.
MACKENZIE PATTERSON SPECIAL FUND
PAT PATTERSON WESTERN SECURITIES,INC.PROFIT SHARING PLAN
JDF & ASSOCIATES, LLC
STEVEN GOLD
MORAGA GOLD, LLC
CAL KAN, INC.

<PAGE>

SCHEDULE I

THE PURCHASERS AND THEIR RESPECTIVE PRINCIPALS

The Purchasers are Previously Owned Partnerships Income Fund II, L.P.,
Accelerated High Yield Institutional Fund 1, L.P., Specified Income Fund, L.P.,
MP Income Fund 11, L.P., MacKenzie Patterson Special Fund, Pat Patterson Western
Securities, Inc. Profit Sharing Plan, JDF & Associates, LLC, Steven Gold, Moraga
Gold, LLC, and Cal Kan, Inc. The General Partner of each of Previously Owned
Partnerships Income Fund II, L.P., Accelerated High Yield Institutional Fund 1,
L.P., Specified Income Fund, L.P., MP Income Fund 11, L.P., and MacKenzie
Patterson Special Fund is MacKenzie Patterson, Inc. The members of Moraga Gold,
LLC are Moraga Partners, Inc. and The David B. Gold Trust. The general manager
of JDF & Associates, LLC is J. David Frantz. The names of the directors and
executive officers of MacKenzie Patterson, Inc. and Cal Kan, Inc., and the
trustees of the Pat Patterson Western Securities, Inc. Profit Sharing Plan and
The David B. Gold Trust, and the present principal occupations and five year
employment histories of each such person are set forth below.
Each individual is a citizen of the United States of America.

MacKenzie Patterson, Inc.

C.E. Patterson is President of MacKenzie Patterson, Inc. He is the
co-founder and President of Patterson Financial Services, Inc. In 1981, Mr.
Patterson founded PFS with Berniece A. Patterson, as a financial planning firm.
Mr. Patterson founded Patterson Real Estate Services, a licensed California Real
Estate Broker, in 1982. As President of PFS, Mr. Patterson is responsible for
all investment counseling activities. He supervises the analysis of investment
opportunities for the clients of the firm. He is a trustee of Consolidated
Capital Properties Trust, a liquidating trust formed out of the bankruptcy court
proceedings involving Consolidated Capital Properties, Ltd. Mr. Patterson is
also an officer and controlling shareholder of Cal-Kan, Inc., an executive
officer and controlling shareholder of Moraga Partners, Inc., and trustee of the
Pat Patterson Western Securities, Inc. Profit Sharing Plan. Mr. Patterson,
through his affiliates, manages a number of investment and real estate
partnerships.

Berniece A. Patterson is a director of MacKenzie Patterson, Inc. In 1981,
Ms. Patterson and C.E. Patterson established Patterson Financial Services, Inc.
She serves as Chair of the Board and Vice President of PFS. Her responsibilities
with PFS include oversight of administrative matters and monitoring of past
projects underwritten by PFS. Ms. Patterson is Chief Executive Officer of an
affiliate, Pioneer Health Care Services, Inc., and is responsible for the
day-to-day operations of three nursing homes and over 250 employees.

Victoriaann Tacheira is senior vice president of MacKenzie Patterson, Inc.,
which she joined in 1988. Ms. Tacheira has eleven years of experience with the
NASD broker/dealer business and is experienced in all phases of broker/dealer
operations. She is licensed with the NASD as a General Securities Principal. She
is president and owner of North Coast Securities Corporation. Ms. Tacheira has
been certified by the College of Financial Planning in Denver, Colorado, as a
Financial ParaPlanner.

Cal Kan, Inc.

Cal Kan, Inc. is a Kansas corporation owned by C.E. Patterson and Thomas A.
Frame. Mr. Patterson and Mr. Frame are also each an executive officer and
director of Cal Kan, Inc. Information regarding Mr. Patterson is set forth
above.

<PAGE>

Thomas A. Frame has been the president of Paradigm Investment Corporation,
a real estate limited partnership secondary market firm, since 1986. In 1973,
Mr. Frame was a co-founder of Transcentury Real Estate Masters, Oakland,
California, a residential and commercial real estate brokerage firm. In 1973 he
also co-founded, and has since then been a partner in, Transcentury Property
Management Company, which has syndicated privately-placed real estate limited
partnerships owning multi-family residential properties. He is a trustee of
Consolidated Capital Properties Trust, a liquidating trust formed out of the
bankruptcy court proceedings involving Consolidated Capital Properties, Ltd. Mr.
Frame is co-owner and an executive officer and director of Cal-Kan, Inc., and
co-owner and an officer of Moraga Partners, Inc., general partner of Moraga Fund
1, L.P. Mr. Frame, through his affiliates, manages over $6 million dollars in
investor capital and is currently managing a total of 1,150 residential units in
four states.

Moraga Gold, LLC

The members of Moraga Gold, LLC are Moraga Partners, Inc. and the David B.
Gold Trust. Information concerning Moraga Partners, Inc. is set forth below.

The David B. Gold Trust is a private trust of which Barbara Lurie is the
trustee and Steven Gold is responsible for certain investments. The sole
beneficiary of the trust is a nonprofit charitable foundation. The business
address of the trust is One Maritime Plaza, Suite 725, San Francisco, California
94111. Barbara Lurie has been employed for the last five years as a physician by
the University of California, San Francisco and the University of Minnesota.
Steven Gold, a California attorney, has been self-employed during the last five
years analyzing investments for his own account and for that of the trust. In
addition, he has participated in starting a number of business ventures,
including T/O Devices, an import/export company.

Moraga Partners, Inc.

Moraga Partners, Inc. is a California corporation owned by C.E. Patterson
and Thomas A. Frame. Mr. Patterson and Mr. Frame are also each an executive
officer and director of Moraga Partners, Inc. Information regarding each of
Mssrs. Patterson and Frame is set forth above.

JDF & Associates LLC

JDF & Associates is a Texas limited liability company engaged in real
estate investment activities. J. David Frantz is the general manager of JDF &
Associates LLC. Mr. Frantz has been an active investor in commercial real
estate, oil and gas investments and equity securities for the past 35 years. He
is currently chairman of Mexicali Borders Cafes, Inc., president of Frantz, Inc.
and eastern regional sales manager for a computer services firm. Mr. Frantz is a
graduate of the Wharton School of Finance. MacKenzie Patterson, Inc. has been
engaged by Mr. Frantz to provide certain real estate securities investment
advice.

<PAGE>

Exhibit (a)(2)

<PAGE>

LETTER OF TRANSMITTAL

THE OFFER, WITHDRAWAL RIGHTS AND PRORATION
PERIOD WILL EXPIRE AT 12:00 MIDNIGHT, PACIFIC
STANDARD TIME, ON MAY 23,1997 (the "Expiration Date")
UNLESS EXTENDED.

Deliver to: MacKenzie Patterson, Inc.
1640 School Street, Suite 100
Moraga, California 94556

Via Facsimile: (510) 631-9119

For assistance: (510) 631-9100 EXT 206

(PLEASE INDICATE CHANGES
OR CORRECTIONS TO THE
ADDRESS PRINTED TO THE LEFT)

To participate in the Offer, a duly executed copy of this Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary on or prior to the Expiration Date. Delivery of
this Letter of Transmittal or any other required documents to an address other
than as set forth above does not constitute valid delivery. The method of
delivery of all documents is at the election and risk of the tendering
Unitholder. Please use the pre-addressed, postage-paid envelope provided.
This Letter of Transmittal is to be completed by Unitholders of Summit
Tax Exempt L.P., II (the "Partnership"), pursuant to the procedures set forth
in the Offer to Purchase (as defined below). Capitalized terms used herein and
not defined herein have the meanings ascribed to such terms in the Offer to
Purchase.

PLEASE CAREFULLY READ THE ACCOMPANYING INSTRUCTIONS

Gentlemen:

The undersigned hereby tenders to Previously Owned Partnerships Income Fund
II, L.P., Accelerated High Yield Institutional Fund 1, L.P., Specified Income
Fund, L.P., MP Income Fund 11, L.P., MacKenzie Patterson Special Fund, Pat
Patterson Western Securities, Inc. Profit Sharing Plan, JDF & Associates, LLC,
Steven Gold, Moraga Gold, LLC, and Cal-Kan, Inc. (together the "Purchasers") all
of the Beneficial Unit Certificates ("Units") in the Partnership held by the
undersigned as set forth above (or, if less than all such Units, the number set
forth below in the signature box) at $10.50 per Unit (the "Offer Price"), less
the amount of any distributions made or declared with respect to the Units
between the Offer Date and the Expiration Date, and upon the other terms and
subject to the conditions set forth in the Offer to Purchase, dated April 24,
1997 (the "Offer to Purchase"), and this Letter of Transmittal (which together
constitute the "Offer"). Receipt of the Offer to Purchase is hereby
acknowledged.

The undersigned recognizes that, if more than 177,500 Units are validly
tendered prior to or on the Expiration Date and not properly withdrawn, the
Purchasers will, upon the terms of the Offer, accept for payment from among
those Units tendered prior to or on the Expiration Date 177,500 Units on a pro
rata basis, with adjustments to avoid purchases of certain fractional Units,
based upon the number of Units validly tendered prior to the Expiration Date and
not withdrawn.

Subject to and effective upon acceptance for payment of any of the Units
tendered hereby, the undersigned hereby sells, assigns and transfers to, or upon
the order of, Purchasers all right, title and interest in and to such Units
which are purchased pursuant to the Offer. The undersigned hereby irrevocably
constitutes and appoints the Purchasers as the true and lawful agent and
attorney-in-fact and proxy of the undersigned with respect to such Units, with
full power of substitution (such power of attorney and proxy being deemed to be
an irrevocable power and proxy coupled with an interest), to deliver such Units
and transfer ownership of such Units, on the books of the Partnership, together
with all accompanying evidences of transfer and authenticity, to or upon the
order of the Purchasers and, upon payment of the purchase price in respect of
such Units by the Purchasers, to exercise all voting rights and to receive all
benefits and otherwise exercise all rights of beneficial ownership of such Units
all in accordance with the terms of the Offer. Subject to and effective upon the
purchase of any Units tendered hereby, the undersigned hereby requests that each
of the Purchasers be admitted to the Partnership as a "substitute Limited
Partner" under the terms of the Partnership Agreement of the Partnership. Upon
the purchase of Units pursuant to the Offer, all prior proxies and consents
given by the undersigned with respect to such Units will be revoked and no
subsequent proxies or consents may be given (and if given will not be deemed
effective). In addition, by executing this Letter of Transmittal, the
undersigned assigns to the Purchasers all of the undersigned's rights to receive
distributions from the Partnership with respect to Units which are purchased
pursuant to the Offer, other than distributions declared or paid on or after the
Offer Date and through the Expiration Date.

The undersigned hereby represents and warrants that the undersigned owns
the Units tendered hereby within the meaning of Rule 13d-3 under the Securities

<PAGE>

Exchange Act of 1934, as amended, and has full power and authority to validly
tender, sell, assign and transfer the Units tendered hereby, and that when any
such Units are purchased by the Purchasers, the Purchasers will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges, encumbrances, conditional sales agreements or other
obligations relating to the sale or transfer thereof, and such Units will not be
subject to any adverse claim. Upon request, the undersigned will execute and
deliver any additional documents deemed by the Purchasers to be necessary or
desirable to complete the assignment, transfer and purchase of Units tendered
hereby.

The undersigned understands that a tender of Units to the Purchasers will
constitute a binding agreement between the undersigned and the Purchasers upon
the terms and subject to the conditions of the Offer. The undersigned recognizes
the right of the Purchasers to effect a change of distribution address to
MacKenzie Patterson, Inc. at 1640 School Street, Suite 100, Moraga, California,
94556. The undersigned recognizes that under certain circumstances set forth in
the Offer to Purchase, the Purchasers may not be required to accept for payment
any of the Units tendered hereby. In such event, the undersigned understands
that any Letter of Transmittal for Units not accepted for payment will be
destroyed by the Purchasers. All authority herein conferred or agreed to be
conferred shall survive the death or incapacity of the undersigned and any
obligations of the undersigned shall be binding upon the heirs, personal
representatives, successors and assigns of the undersigned. Except as stated in
the Offer to Purchase, this tender is irrevocable.

===============================================================================
SIGNATURE BOX
(Please complete Boxes A, B, C and D on the following page as necessary)
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- ----------------------------------------------------------------------------
Please sign exactly as your name is
printed (or corrected) above, and
insert your Taxpayer Identification
Number or Social Security Number in
the space provided below your X_______________________________
signature. For joint owners, (Signature of Owner) Date
each joint owner must sign.
(See Instructions 1) The
signatory hereto hereby certifies X_______________________________
under penalties of perjury the (Signature of Owner) Date
statements in Box B, Box C and,
if applicable, Box D. If the
undersigned is tendering less Taxpayer I.D. or Social # ____
than all Units held, the number Telephone No. (day) __________
of Units tendered is set forth (eve.)__________
below. Otherwise, all Units held
by the undersigned are tendered hereby.

______________ Units
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BOX A
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Name and Address of Eligible Institution: ____________________________________
Authorized Signature _____________________________ Title _________________
Name ________________________________ Date _______________,199___
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<PAGE>

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BOX B
SUBSTITUTE FORM W-9
(See Instruction 3 - Box B)
- -------------------------------------------------------------------------------
The person signing this Letter of Transmittal hereby certifies the
following to the Purchasers under penalties of perjury:
(i) The TIN set forth in the signature box on the front of
this Letter of Transmittal is the correct TIN of the Unitholder, or if this box
[ ] is checked, the Unitholder has applied for a TIN. If the Unitholder has
applied for a TIN, a TIN has not been issued to the Unitholder, and either: (a)
the Unitholder has mailed or delivered an application to receive a TIN to the
appropriate IRS Center or Social Security Administration Office, or (b) the
Unitholder intends to mail or deliver an application in the near future (it
being understood that if the Unitholder does not provide a TIN to the Purchasers
within sixty (60) days, 31% of all reportable payments made to the Unitholder
thereafter will be withheld until a TIN is provided to the Purchasers); and
(ii) Unless this box [ ] is checked, the Unitholder is not
subject to backup withholding either because the Unitholder: (a) is exempt from
backup withholding, (b) has not been notified by the IRS that the Unitholder is
subject to backup withholding a sa result of a failure to report all interest or
dividends, or (c) has been notified by the IRS that such Unitholder is no longer
subject to backup withholding.

Note: Place an "X" in the box in (ii) if you are unable to certify
that the Unitholder is not subject to backup withholding.

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BOX C
FIRPTA AFFIDAVIT
(See Instruction 3 - Box C)
- -------------------------------------------------------------------------------
Under Section 1445(e)(5) of the Internal Revenue Code and Treas. Reg.
1.1445-11T(d), a transferee must withhold tax equal to 10% of the amount
realized with respect to certain transfers of an interest in a partnership if
50% or more of the value of its gross assets consists of U.S. real property
interests and 90% or more of the value of its gross assets consists of U.S. real
property interests plus cash equivalents, and the holder of the partnership
interest is a foreign person. To inform the Purchasers that no withholding is
required with respect to the Unitholder's interest in the Partnership, the
person signing this Letter of Transmittal hereby certifies the following under
penalties of perjury;
(i) Unless this box [ ] is checked, the Unitholder, if an
individual, is a U.S. citizen or a resident alien for purposes of U.S. income
taxation, and if other than an individual, is not a foreign corporation, foreign
partnership, foreign estate or foreign trust (as those terms are defined in the
Internal Revenue Code and Income Tax Regulations); (ii) the Unitholder's U.S.
social security number (for individuals) or employer identification number (for
non-individuals) is correctly printed in the signature box on the front of this
Letter of Transmittal; and (iii) the Unitholder's home address (for
individuals), or office address (for non-individuals), is correctly printed (or
corrected) on the front of this Letter of Transmittal. If a corporation, the
jurisdiction of incorporation is __________.
The person signing this Letter of Transmittal understands that this
certification may be disclosed to the IRS by the Purchasers and that any false
statements contained herein could be punished by fine, imprisonment, or both.
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BOX D
SUBSTITUTE FORM W-8
(See Instruction 4 - Box D)
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By checking this box [ ], the person signing this Letter of
Transmittal hereby certifies under penalties of perjury that the Unitholder is
an "exempt foreign person" for purposes of the backup withholding rules under
the U.S. federal income tax laws, because the Unitholder:

(i) Is a nonresident alien individual or a foreign corporation,
partnership, estate or trust;
(ii) If an individual, has not been and plans not to be present in the
U.S. for a total of 183 days or more during the calendar year; and
(iii) Neither engages, nor plans to engage, in a U.S. trade or business
that has effectively connected gains from transactions with a
broker or barter exchange.
===============================================================================

<PAGE>

INSTRUCTIONS

Forming Part of the Terms and Conditions of the Offer

1. Tender, Signature Requirements; Delivery. After carefully reading and
completing this Letter of Transmittal, in order to tender Units a Unitholder
must sign at the "X" on the bottom of the first page of this Letter of
Transmittal and insert the Unitholder's correct Taxpayer Identification Number
or Social Security Number ("TIN") in the space provided below the signature. The
signature must correspond exactly with the name printed (or corrected) on the
front of this Letter of Transmittal without any change whatsoever. If this
Letter of Transmittal is signed by the registered Unitholder of the units a
Medallion signature guarantee on this Letter of Transmittal is required.
Similarly, if Units are tendered for the account of a member In all cases firm
of a registered national security exchange, a member firm of the National
Association of Securities Dealer, Inc. or a commercial bank, savings bank,
credit union, saving and loan association or trust company having an office,
branch or agency in the United States (each an "Eligible Institution"), a
Medallion signature guarantee is required. In all other cases, signatures on
this Letter of Transmittal must be Medallion guaranteed by an Eligible
Institution, by completing the Signature guarantee set forth in BOX A of this
Letter of Transmittal. If this Letter of Transmittal is signed by trustees,
administrators, guardians, attorneys-in-fact, officers of corporations, or
others acting in a fiduciary or representative capacity, such persons should so
indicate when signing and must submit proper evidence satisfactory to the
Purchasers of their authority to so act. For Units to be validly tendered, a
properly completed and duly executed Letter of Transmittal, together with any
required notarizations or signature guarantees in BOX A, and any other documents
required by this Letter of Transmittal, must be received by the depositary prior
to or on the Expiration Date at its address or facsimile number set forth on the
front of this Letter of Transmittal. No alternative, conditional or contingent
tenders will be accepted. All tendering Unitholders by execution of this Letter
of Transmittal waive any right to receive any notice of the acceptance of their
tender.

2. Transfer Taxes. The Purchasers will pay or cause to be paid all transfer
taxes, if any, payable in respect of Units accepted for payment pursuant to the
Offer.

3. U.S. Persons. A Unitholder who or which is a United States citizen or
resident alien individual, a domestic corporation, a domestic partnership, a
domestic trust or a domestic estate (collectively "United States persons") as
those terms are defined in the Internal Revenue Code and Income Tax Regulations,
should complete the following:

Box B - Substitute Form W-9. In order to avoid 31% federal income tax
backup withholding, the Unitholder must provide to the Purchasers the
Unitholder's correct Taxpayer Identification Number or Social Security
Number ("TIN") in the space provided below the signature line and
certify, under penalties of perjury, that such Unitholder is not
subject to such backup withholding. The TIN that must be provided is
that of the registered Unitholder indicated on the front of this Letter
of Transmittal. If a correct TIN is not provided, penalties may be
imposed by the Internal Revenue Service ("IRS"), in addition to the
Unitholder being subject to backup withholding. Certain Unitholders
(including, among others, all corporations) are not subject to backup
withholding. Backup withholding is not an additional tax. If
withholding results in an overpayment of taxes, a refund may be
obtained from the IRS.

Box C - FIRPTA Affidavit. To avoid potential withholding of tax
pursuant to Section 1445 of the Internal Revenue Code, each Unitholder
who or which is a United States Person (as defined Instruction 3 above)
must certify, under penalties of perjury, the Unitholder's TIN and
address, and that the Unitholder is not a foreign person. Tax withheld
under Section 1445 of the Internal Revenue Code is not an additional
tax. If withholding results in an overpayment of tax, a refund may be
obtained from the IRS.

4. Box D - Foreign Persons. In order for a Unitholder who is a foreign
person (i.e., not a United States Person as defined in 3 above) to qualify as
exempt from 31% backup withholding, such foreign Unitholder must certify, under
penalties of perjury, the statement in BOX D of this Letter of Transmittal
attesting to that foreign person's status by checking the box preceding such
statement. However, such person will be subject to withholding of tax under
Section 1445 of the Code.

5. Additional Copies of Offer to Purchase and Letter of Transmittal.
Requests for assistance or additional copies of the Offer to Purchase and this
Letter of Transmittal may be obtained from the Purchasers by calling
800-854-8357.

<PAGE>

Exhibit (a)(3)

<PAGE>

April 24, 1997

TO: Holders of Summit Tax Exempt L.P. II Beneficial
Unit Certificates ("BUCs or "Units")

SUBJECT: OFFER TO PURCHASE UNITS AT $10.50 PER UNIT
--------

Dear Unitholder:

As described in the enclosed Offer to Purchase and related Letter of
Transmittal (the "Offer"), Previously Owned Partnerships Income Fund II, L.P.,
Accelerated High Yield Institutional Fund 1, L.P., Specified Income Fund, L.P.,
MP Income Fund 11, L.P., MacKenzie Patterson Special Fund, Pat Patterson Western
Securities, Inc. Profit Sharing Plan, JDF & Associates, LLC, Steven Gold, Moraga
Gold, LLC and Cal Kan, Inc. (together the "Purchasers") are offering to purchase
up to 177,500 Units in Summit Tax Exempt L.P. II for

$10.50 CASH PER UNIT.

The Offer will provide you with an opportunity to liquidate all or a
portion of your investment in Summit Tax Exempt L.P. II without the usual
transaction costs associated with secondary market sales or partnership transfer
fees.

After carefully reading the enclosed Offer, if you elect to tender your
Units, mail (using the enclosed pre-addressed, postage paid envelope) or
telecopy a duly completed and executed copy of the green Letter of Transmittal,
and any other documents required by the Letter of Transmittal, to the Depositary
for the Offer at:

MacKenzie Patterson, Inc.,
1640 School Street, Suite l00
Moraga, California 94556

Telecopy: (510) 631-9119

If you have any questions or need assistance, please call the Depository at
510-631-9100 ext. 206.

This Offer expires (unless extended) May 23, 1997

<PAGE>

Exhibit (a)(4)

<PAGE>

This announcement is neither an offer to buy nor a solicitation of an offer to
sell Units. The Offer is being made solely by the formal Offer to Purchase
forwarded to Unitholders of record and is not being made to, nor will tenders be
accepted from or on behalf of, Unitholders residing in any jurisdiction in which
making or accepting the Offer would violate that jurisdiction's laws. In those
jurisdictions where the securities, blue sky or other laws require the Offer to
be made by a licensed broker or dealer, the Offer shall be deemed to be made on
behalf of Purchasers only by one or more registered dealers licensed under the
laws of such jurisdiction.

Notice of Offer to Purchase for Cash
up to 177,500 Beneficial Unit Certificates ("Units") of
Summit Tax Exempt L.P. II, a Delaware Limited Partnership ("Summit II")
at a price of $10.50 per Unit, by:
Previously Owned Partnerships Income Fund II, L.P.;
Accelerated High Yield Institutional Fund 1, L.P.;
Specified Income Fund, L.P.
MP Income Fund 11, L.P.
MacKenzie Patterson Special Fund
Pat Patterson Western Securities, Inc. Profit Sharing Plan
JDF & Associates, LLC; Steven Gold; Moraga Gold, LLC; and
Cal Kan, Inc. (collectively the "Purchasers")

The Purchasers are offering to purchase for cash up to 177,500 Units held by the
Unitholders of Summit II (the "Unitholders") at $10.50 per Unit upon the terms
and subject to the conditions set forth in Purchasers' Offer to Purchase and in
the related Letter of Transmittal (which together constitute the "Offer" and the
"Tender Offer Documents").

THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, PACIFIC DAYLIGHT TIME,
ON MAY 23, 1997, UNLESS THE OFFER IS EXTENDED.

Funding for the purchase of the Units will be provided through the
Purchasers' existing working capital.
The Offer will expire at 12:00 midnight, Pacific Daylight Time on May 23,
1997, and unless and until Purchasers, in their sole discretion, shall have
extended the period of time for which the Offer is open (such date and time, as
extended the "Expiration Date").
If Purchasers make a material change in the terms of the Offer, or if they
waive a material condition to the Offer, Purchasers will extend the Offer and
disseminate additional tender offer materials to the extent required by Rules
14d-4(c) and 14d-6(d) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). The minimum period during which an offer must remain open
following any material change in the terms of the Offer, other than a change in
price or a change in percentage of securities sought or a change in any dealer's
soliciting fee, will depend upon the facts and circumstances including the
materiality of the change with respect to a change in price or, subject to
certain limitations, a change in the percentage of securities ought or a change
in any dealer's soliciting fee. A minimum of ten business days from the date of
such change is generally required to allow for adequate dissemination to
Unitholders. Accordingly, if prior to the Expiration Date, Purchasers increase
(other than increases of not more than two percent of the outstanding Units) or
decrease the number of Units being sought, or increase or decrease the
consideration offered pursuant to the Offer, and if the Offer is scheduled to
expire at any time earlier than the period ending on the tenth business day from
the date that notice of such increase or decrease is first published, sent or
given to Unitholders, the Offer will be extended at least until the expiration
of such ten business days. For purposes of the Offer, a "business day" means any
day other than a Saturday, Sunday or federal holiday and consists of the time
period from 12:01 a.m. through 12:00 midnight, Pacific Daylight Time.
In all cases payment for the Units purchased pursuant to the Offer will be
made only after timely receipt of the Letters of Transmittal (or facsimiles
thereof), properly completed and duly executed, with any required signature
guarantees, and any other documents required by such Letters of Transmittal.
Tenders of Units made pursuant to the Offer are irrevocable, except that
Unitholders who tender their Units in response to the Offer will have the right
to withdraw their tendered Units at any time prior to the Expiration Date by
sending a written or facsimile transmission notice of withdrawal to Purchasers
specifying the name of the person who tendered the Units to be withdrawn. In
addition, tendered Units may be withdrawn at any time after June 24, 1997,
unless the tender has theretofore been accepted for payment as provided above.
If tendering Unitholders tender more than the number of Units that
Purchasers seek to purchase pursuant to the Offer, Purchasers will take into
account the number of Units so tendered and take up and pay for as nearly as may
be pro rata, disregarding fractions, according to the number of Units tendered
by each tendering Unitholder during the period during which the Offer remains
open.
The terms of the Offer are more fully set forth in the formal Tender Offer
Documents which are available from Purchasers. The Offer contains terms and
conditions and the information required by Rule 14d-6(e)(1)(vii) under the
Exchange Act which are incorporated herein by reference.
The Tender Offer Documents contain important information which should be
read carefully before any decision is made with respect to the Offer.

The Tender Offer Documents may be obtained by written request to Purchasers
or as set forth below.
A request has been made to Summit II pursuant to Rule 14d-5 under the
Exchange Act for the use of its list of Unitholders for the purpose of
disseminating the Offer to Unitholders. Upon compliance by Summit II with such
request, the Tender Offer Documents and, if required, other relevant materials
will be mailed to record holders of Units or persons who are listed as
participants in a clearing agency's security position listing, for subsequent
transmittal to beneficial owners of Units.

For Copies of the Tender Offer Documents Call Purchasers at 1-510-631-9100
Extention 206or Make a Written Request Addressed to 1640 School Street, Suite
100, Moraga, California 94556

April 24, 1997