SECOND AMENDMENT TO MANAGEMENT AGREEMENT
               RMI COVERED HOPPER RAILCAR MANAGEMENT PROGRAM 79-1

         This Second  Amendment to  Management  Agreement is made as of the date
set forth below opposite the signature of "Owner".

         The  undersigned  signatory  identified  as  ("Owner")  is  party  to a
Management Agreement with PLM Investment Management,  Inc. ("IMI" or "Manager"),
covering the management of the covered hopper railcars identified  therein.  All
references to "RMI" in the Management Agreement shall be deemed to refer to IMI.

         In  consideration  of the  continuing  appointment of IMI as Manager by
Owner,  and for other good and valuable  consideration,  Owner and IMI do hereby
amend the Management Agreement as follows:

          1.   The  Management  Agreement  shall be extended for a fixed term of
               five years,  beginning October 1, 1999 and expiring September 30,
               2004.


          2.   IMI shall  receive a minimum  monthly  management  fee of $38 per
               car. Said minimum  monthly  management fee shall be prorated on a
               daily basis for any period less than a full month.  In  addition,
               IMI  shall  receive  an  incentive  management  fee of 15% of net
               income over $750 per car per quarter.

         Except as modified by this Amendment, all other terms and conditions of
the  Management  Agreement  shall remain the same for the  extended  term of the
Management Agreement.

         IN WITNESS  WHEREOF,  the  parties  have  executed  this  Amendment  to
Management  Agreement as of the date set forth below  opposite the  signature of
Owner.

PLM INVESTMENT MANAGEMENT, INC.     OWNER'S SIGNATURE

By:   /s/Stephen M. Bess            By:
Title:  Senior Vice President



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