INTERCREDITOR AGREEMENT

Intercreditor Agreement

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COVANTA ENERGY CORP

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Title: INTERCREDITOR AGREEMENT
Governing Law: New York Date: 3/30/2004
Industry: Electric Utilities Sector: Utilities

INTERCREDITOR AGREEMENT, Parties: covanta energy corp

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Exhibit 10.1(v)

INTERCREDITOR AGREEMENT

This INTERCREDITOR AGREEMENT (as amended, restated, supplemented or

otherwise modified from time to time in accordance with the terms hereof, herein

called this "AGREEMENT") is dated as of March 10, 2004 and entered into by and

among COVANTA ENERGY CORPORATION, a Delaware corporation ("Covanta" or

"COMPANY"), and THE SUBSIDIARIES OF COVANTA LISTED ON THE SIGNATURE PAGES HEREOF

AS DETROIT L/C BORROWERS (together with Company and any Additional Detroit L/C

Borrowers (as hereinafter defined; this and other capitalized terms used herein

without definition being used as defined in subsection 1.1), collectively,

"DETROIT L/C BORROWERS" and each a "DETROIT L/C BORROWER") and THE SUBSIDIARIES

OF COVANTA LISTED ON THE SIGNATURE PAGES HEREOF AS NEW L/C BORROWERS (together

with Company and any Additional New L/C Borrowers, collectively, "NEW L/C

BORROWERS" and each a "NEW L/C BORROWER"; the Detroit L/C Borrowers together

with the New L/C Borrowers, collectively, "BORROWERS" and each a "BORROWER");

THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF AS DETROIT L/C

LENDERS (each, in its capacity as a Detroit L/C Lender, together with any other

Person that become a party hereto as a Detroit L/C Lender pursuant to subsection

6.1(f), individually referred to herein as a "DETROIT L/C LENDER" and

collectively as "DETROIT L/C Lenders"); THE ENTITIES LISTED ON THE SIGNATURE

PAGES HEREOF AS NEW L/C LENDERS (each, in its capacity as a New L/C Lender,

together with any other Person that becomes a party hereto as a New L/C Lender

pursuant to subsection 6.1(f), individually referred to herein as "NEW L/C

LENDER" and collectively as "NEW L/C LENDERS"); BANK OF AMERICA, N.A. ("BANK OF

AMERICA"), as administrative agent for Detroit L/C Lenders (and any successor

administrative agent for Detroit L/C Lenders pursuant to the Detroit L/C

Agreement, in such capacity "DETROIT L/C FACILITY AGENT"), as Collateral Agent

and Cash Management Bank, BANK ONE, NA, as administrative agent for New L/C

Lenders (and any successor administrative agent for New L/C Lenders pursuant to

the New L/C Facility Agreement, in such capacity "NEW L/C Agent"); DEUTSCHE BANK

SECURITIES, INC. ("DEUTSCHE BANK"), as Documentation Agent for Detroit L/C

Lenders (and any successor documentation agent for Detroit L/C Lenders pursuant

to the Detroit L/C Agreement in such capacity "DETROIT L/C DOCUMENTATION

AGENT"); DANIELSON HOLDING CORPORATION, a Delaware corporation ("DHC"); U.S.

BANK NATIONAL ASSOCIATION, in its capacity as trustee under the High Yield

Indenture (in such capacity, the "HIGH YIELD TRUSTEE"); THE COMPANIES LISTED ON

THE SIGNATURE PAGES HEREOF AS MANAGEMENT SERVICES AND REIMBURSEMENT AGREEMENT

BENEFICIARIES (the "MANAGEMENT SERVICES AND REIMBURSEMENT AGREEMENT

BENEFICIARIES"); and the other Persons who may become parties to this Agreement

from time to time pursuant to and in accordance with subsections 6.1(f) and

6.1(l) of this Agreement.

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R E C I T A L S

WHEREAS, the Borrowers have proposed, their creditors have approved,

and the Bankruptcy Court has confirmed, the Plan of Reorganization;

WHEREAS, in connection with the Plan of Reorganization,

simultaneously herewith the Borrowers have received financing pursuant to the

Detroit L/C Facility Agreement, New L/C Facility Agreement and High Yield

Indenture;

WHEREAS, it is a condition precedent to (i) the obligations of the

Detroit L/C Lenders to enter into and extend credit under the Detroit L/C

Facility Agreement, (ii) the obligations of the New L/C Lenders to enter into

and extend credit under the New L/C Facility Agreement, (iii) the obligations of

the holders of the High Yield Notes to accept the High Yield Notes in exchange

for certain pre-existing claims against Loan Parties (other than DHC) and (iv)

the effectiveness of the Plan of Reorganization, as applicable, that each

Creditor Party, High Yield Trustee and each Borrower shall have executed and

delivered this Agreement to the Collateral Agent;

WHEREAS, on the date hereof Loan Parties have executed and delivered

to Collateral Agent the Collateral Documents pursuant to which Loan Parties

granted a security interest in the Collateral as security for (i) in the case of

Detroit L/C Borrowers, all Obligations of Detroit L/C Borrowers under and in

respect of the Detroit L/C Facility Agreement and all other Detroit L/C Facility

Documents to which Detroit L/C Borrowers are a party to from time to time, in

each case as described therein, (ii) in the case of New L/C Borrowers, all

Obligations of New L/C Borrowers under and in respect of the New L/C Facility

Agreement and all other New L/C Facility Documents to which New L/C Borrowers

are party to from time to time, in each case as described therein, and (iii) in

the case of Company and High Yield Guarantors, all Obligations of Company and

High Yield Guarantors under and in respect of the High Yield Notes and High

Yield Indenture;

WHEREAS, Creditor Parties and High Yield Trustee desire to set forth

certain provisions regarding the appointment, duties and responsibilities of

Collateral Agent and to set forth certain other provisions concerning the

obligations of Loan Parties to Creditor Parties and High Yield Noteholders under

the agreements referred to in the foregoing recitals; and

WHEREAS, Creditor Parties and High Yield Trustee wish to set forth

their mutual intentions as to certain matters relating to the exercise of

remedies with respect to the Collateral and payments made by or for the account

of the applicable Loan Parties under the Credit Documents as more fully set

forth herein.

NOW, THEREFORE, the parties hereto hereby agree as follows:

SECTION I

1.1 DEFINITIONS. Terms used in the Agreement have the meanings set

forth in the introduction and recitals hereto. In addition, the following terms

shall have the following meanings:

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"ADDITIONAL DETROIT L/C BORROWER" means any Person that becomes an

"Additional Subsidiary Borrower" after the date hereof pursuant to and as such

term is defined in the Detroit L/C Facility Agreement.

"ADDITIONAL NEW L/C BORROWER" means any Person that becomes an

"Additional Subsidiary Borrower" after the date hereof pursuant to and as such

term is defined in the New L/C Facility Agreement.

"AGENTS" means Collateral Agent, Detroit L/C Agents and New L/C

Agent.

"AFFILIATE", as applied to any Person, means any other Person

directly or indirectly controlling, controlled by, or under common control with,

that Person. For the purposes of this definition, "control" (including, with

correlative meanings, the terms "controlling", "controlled by" and "under common

control with"), as applied to any Person, means the possession, directly or

indirectly, of the power to direct or cause the direction of the management and

policies of that Person (other than exclusively as a result of such Person's

role as a senior executive of that Person or Project manager or operator),

whether through the ownership of voting securities or by contract or otherwise.

"ANNUAL FREE CASH FLOW" shall have the meaning assigned to that term

in the each Facility Agreement as in effect on the Closing Date.

"BANK OF AMERICA" shall have the meaning assigned to that term in

the introduction to this Agreement.

"BANKRUPTCY CODE" means Title 11 of the United States Code entitled

"Bankruptcy", as now and hereafter in effect, or any successor statute.

"BANKRUPTCY COURT" means the United States Bankruptcy Court for the

Southern District of New York and any other court properly exercising

jurisdiction over any relevant Chapter 11 Case.

"BANKRUPTCY EVENT" means any of one or more of the following events

regardless of the reason therefor:

(a) (i) a court having jurisdiction in the premises shall enter a

decree or order for relief in respect of any Loan Party in an involuntary

case under the Bankruptcy Code or any applicable bankruptcy, insolvency or

other similar law now or hereafter in effect, which decree or order is not

stayed; or any other similar relief shall be granted under any applicable

federal, or state law; or (ii) an involuntary case shall be commenced

against any Loan Party under any applicable bankruptcy, insolvency or

other similar law now or hereafter in effect; or a decree or order of a

court having jurisdiction in the premises for the appointment of a

receiver, liquidator, sequestrator, trustee, custodian or other officer

having similar powers over any Loan Party, or over all or a substantial

part of its property, shall have been entered; or the involuntary

appointment of an interim receiver, trustee or other custodian of any Loan

Party for all or a substantial part of its property; or the issuance of a

warrant of attachment, execution or similar process against

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any substantial part of the property of any Loan Party, and the

continuance of any such event in clause (ii) for 60 days unless dismissed,

bonded or discharged; or

(b) (i) any Loan Party shall have an order for relief entered with

respect to it or commence a voluntary case under the Bankruptcy Code or

any applicable bankruptcy, insolvency or other similar law now or

hereafter in effect, or shall consent to the entry of an order for relief

in an involuntary case, or to the conversion of an involuntary case to a

voluntary case, under any such law, or shall consent to the appointment of

or taking possession by a receiver, trustee or other custodian for all or

a substantial part of its property, or shall make any assignment for the

benefit of creditors; or

(ii) the inability or failure of any Loan Party, or the

admission by any Loan Party in writing of its inability, to pay its debts

as such debts become due; or the Governing Body (or any committee thereof)

of any Loan Party adopts any resolution or otherwise authorizes action to

approve any of the actions referred to in clause (i) or this clause (ii);

Party decreeing the dissolution, winding up or split up of that Loan Party

and such order shall remain undischarged or unstayed for a period in

excess of 30 days.

"BANKRUPTCY PROCEEDING" means any case or proceeding of the type

described in the definition of "Bankruptcy Event" with respect to any Loan

Party.

"BORROWER" and BORROWERS" shall have the meaning assigned to such

terms in the introduction to this Agreement.

"BUSINESS DAY" means any day excluding Saturday, Sunday and any day

which is a legal holiday under the laws of the State of New York, the State of

Texas or the State of California or is a day on which banking institutions

located in any such state are authorized or required by law or other

governmental action to close.

"CAPITAL STOCK" means the capital stock or other equity interests of

a Person.

"CASH COLLATERAL ACCOUNTS" means the Detroit L/C Cash Collateral

Account and the New L/C Cash Collateral Account.

"CASH MANAGEMENT BANK" shall have the meaning assigned to that term

in the definition of "Cash Management System".

"CASH MANAGEMENT OBLIGATIONS" means the obligations of Borrowers to

the Cash Management Bank arising from or relating to the Cash Management System,

including any liability of Borrower on any claim arising out of or relating to

the Cash Management System, whether or not the right to payment in respect of

such claim is reduced to judgment, liquidated, unliquidated, fixed or

contingent, matured, disputed, undisputed, legal, equitable, secured or

unsecured, and whether or not such claim is discharged, stayed or otherwise

affected by any bankruptcy, insolvency, reorganization or other similar

proceeding.

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"CASH MANAGEMENT SYSTEM" means the cash management system of Company

and its Subsidiaries in the United States maintained with Bank of America (in

such capacity, "CASH MANAGEMENT BANK") as described in Schedule 4.1P annexed to

the Detroit L/C Facility Agreement and the New L/C Facility Agreement, as such

Cash Management System may be modified pursuant to subsection 6.10 of the

Detroit L/C Facility Agreement and the New L/C Facility Agreement, and any other

related services provided by Cash Management Bank to Company and its

Subsidiaries, including treasury, depositary and cash management services or in

connection with automated clearing house transfers of funds.

"CHAPTER 11 CASE" means the chapter 11 cases of Covanta Energy

Corporation, a Delaware corporation, and certain of its Subsidiaries, including

Borrowers, jointly administered under Case Nos. 02-40826 through 02-40949,

02-16322, 03-13679 through 03-13685, and 03-13687 through 03-13709.

"CLOSING DATE" means March 10, 2004.

"COLLATERAL" means, collectively, all of the real, personal and

mixed property (including Capital Stock) and interests in property now owned or

hereafter acquired by any Loan Party in or upon which a security interest, Lien

or mortgage is granted or purported to be granted to Collateral Agent pursuant

to the Collateral Documents, including all Proceeds thereof, but in no event

shall Collateral include the Capital Stock of CPIH pledged pursuant to the CPIH

Stock Pledge Agreement (as defined in the Facility Agreements). For the

avoidance of doubt, "Collateral" shall not include any New Investor Assurances.

"COLLATERAL AGENT" shall have the meaning assigned to that term in

subsection 2.1.

"COLLATERAL DOCUMENTS" means the Security Agreement, DHC Pledge

Agreement, Control Agreements, Mortgages (as defined in the Facility Agreements)

and all other instruments or documents (pursuant to which a Lien to secure all

or any portion of the Obligations is purported or intended to be created,

granted, evidenced or perfected) delivered from time to time by any Loan Party

pursuant to the Detroit L/C Facility Documents, New L/C Facility Documents or

the High Yield Indenture in each case in order to grant to Collateral Agent a

Lien on any real, personal or mixed property as security for any or all of the

Obligations, as such instruments and documents may be amended, restated,

supplemented or otherwise modified from time to time to the extent permitted

pursuant to subsection 2.4.

"COMPANY" shall have the meaning assigned to that term in the

introduction to this Agreement.

"CONTRACTUAL OBLIGATION", as applied to any Person, means any

provision of any Security issued by that Person or of any material indenture,

mortgage, deed of trust, contract, undertaking, agreement or other instrument to

which that Person is a party or by which it or any of its properties is bound or

to which it or any of its properties is subject.

"CONTROL AGREEMENT" means an agreement, satisfactory in form and

substance to Detroit L/C Facility Agent and New L/C Agent and executed by the

financial institution or securities intermediary at which a Deposit Account or a

Securities Account, as the case may be,

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is maintained, pursuant to which such financial institution or securities

intermediary confirms and acknowledges Collateral Agent's security interest in

such account, and agrees that the financial institution or securities

intermediary, as the case may be, will comply with instructions originated by

Collateral Agent as to disposition of funds in such account, without further

consent by Company or any Subsidiary, as such agreement may be amended,

restated, supplemented or otherwise modified from time to time to the extent

permitted pursuant to subsection 2.4.

"COUNTERPART" shall have the meaning assigned to that term in

subsection 6.1(l).

"COVANTA" shall have the meaning assigned to that term in the

introduction to this Agreement.

"CPIH" means Covanta Power International Holdings, Inc., a

Delaware corporation, and its successors and assigns.

"CPIH SUBSIDIARIES" means, on and after the Closing Date, CPIH and

its Subsidiaries.

"CREDIT DOCUMENTS" means, collectively, (i) the New L/C Facility

Agreement and the other New L/C Facility Documents, (ii) the Detroit L/C

Facility Agreement and the other Detroit L/C Facility Documents, and (iii) the

High Yield Notes and the High Yield Indenture, in each case as they may be

amended, restated, supplemented or otherwise modified from time to time to the

extent permitted thereunder and pursuant to subsection 2.5.

"CREDITOR PARTIES" means Detroit L/C Lenders, New L/C Lenders,

Detroit L/C Agents, New L/C Agent, Cash Management Bank and Collateral Agent.

"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or similar

account maintained with a Person engaged in the business of banking, including a

savings bank, savings and loan association, credit union or trust company.

"DETROIT L/C" or "DETROIT L/CS" means letters of credit issued or to

be issued from time to time under the Detroit L/C Facility Agreement, including

amendments thereto.

"DETROIT L/C AGENTS" means the Detroit L/C Facility Agent and

Detroit L/C Documentation Agent.

"DETROIT L/C BORROWER" shall have the meaning assigned to that term

in the introduction to this Agreement.

"DETROIT L/C CASH COLLATERAL ACCOUNT" means the cash collateral

account maintained with Collateral Agent pursuant to the Security Agreement to

secure the obligations of Detroit L/C Borrowers with respect to Detroit L/C

Exposure.

"DETROIT L/C COMMITMENT" means the commitment of a Detroit L/C

Lender to purchase and fund participations in Detroit L/Cs pursuant to the

Detroit L/C Facility Agreement.

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"DETROIT L/C DOCUMENTATION AGENT" shall have the meaning assigned to

that term in the introduction to this Agreement.

"DETROIT L/C EVENT OF DEFAULT" means an "Event of Default" under and

as defined in the Detroit L/C Facility Agreement.

"DETROIT L/C EXPOSURE" means, with respect to any Detroit L/C Lender

as of any date of determination, the sum of (a) in the event that Detroit L/C

Lender is a Detroit L/C Issuing Lender, the aggregate Detroit L/C Usage in

respect of all Detroit L/Cs issued by that Detroit L/C Lender (in each case net

of any participations purchased by other Detroit L/C Lenders in such Detroit

L/Cs or in any drawings thereunder not theretofore reimbursed by Detroit L/C

Borrowers) plus (b) the aggregate amount of all participations purchased by that

Detroit L/C Lender in any other outstanding Detroit L/Cs or any drawings under

any such other Detroit L/Cs not theretofore reimbursed by Detroit L/C Borrowers.

"DETROIT L/C FACILITY AGENT" shall have the meaning assigned to that

term in the introduction to this Agreement.

"DETROIT L/C FACILITY AGREEMENT" means (i) that certain credit

agreement dated as of the date hereof by and among Covanta and the other Detroit

L/C Borrowers, as borrowers, the Detroit L/C Lenders and Detroit L/C Agents, and

(ii) any credit agreement entered into by Detroit L/C Borrowers to refinance,

replace, renew or extend, in whole or in part, the credit agreement referenced

in clause (i) and the indebtedness and letters of credit issued thereunder to

the extent permitted pursuant to the New L/C Facility Agreement and the High

Yield Indenture, in the case of clause (i) or (ii), as such credit agreement may

be amended, restated, supplemented or otherwise modified from time to time to

the extent permitted under subsection 2.5.

"DETROIT L/C FACILITY DOCUMENTS" means the "Credit Documents" as

defined in the Detroit L/C Facility Agreement (or any comparable term with

respect to any replacement Detroit L/C Facility Agreement not prohibited

hereunder).

"DETROIT L/C ISSUING LENDER" means, with respect to any Detroit L/C,

the Detroit L/C Lender that has issued such Detroit L/C pursuant to the Detroit

L/C Facility Agreement.

"DETROIT L/C LENDER" shall have the meaning assigned to that term in

the introduction to this Agreement.

"DETROIT L/C OBLIGATIONS" means any and all Obligations to the

extent arising under or with respect to the Detroit L/C Commitments or the

Detroit L/Cs, including fees and other amounts accruing or otherwise owed with

respect to the Detroit L/C Exposure, and any drawings (and interest accrued

thereon) under Detroit L/Cs not reimbursed by Detroit L/C Borrowers; provided,

however, that Obligations of any Loan Party (other than DHC) for interest or

letter of credit fees with respect to Detroit L/Cs and Detroit L/C Commitments

that accrue or may be incurred under any Detroit L/C Facility Document after the

commencement by or against any Loan Party of a Bankruptcy Proceeding shall be

included in Detroit L/C Obligations solely to the extent recoverable from such

Loan Party or its estate in such proceeding.

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"DETROIT L/C USAGE" means, as at any date of determination, the sum

of (i) the maximum aggregate amount which is or at any time thereafter may

become available for drawing under all Detroit L/Cs then outstanding plus (ii)

the aggregate amount of all drawings under Detroit L/Cs honored by the

applicable Detroit L/C Issuing Lender and not theretofore reimbursed by Detroit

L/C Borrowers.

"DEUTSCHE BANK" shall have the meaning assigned to that term in the

introduction to this Agreement.

"DHC" shall have the meaning assigned to that term in the

introduction to this Agreement.

"DHC PLEDGE AGREEMENT" means the pledge agreement executed and

delivered by DHC on the Closing Date, substantially in the form of Exhibit XI

annexed to the Detroit L/C Facility Agreement, as such pledge agreement may

thereafter be amended, restated, supplemented or otherwise modified from time to

time to the extent permitted pursuant to subsection 2.4.

"DISTRIBUTION" means, with respect to any Secured Obligation, (a)

any payment or distribution by Company or any of its Subsidiaries (including

CPIH Subsidiaries) of cash, securities or other assets and properties of any

kind whatsoever, real or personal, tangible or intangible, or mixed, whether now

owned or existing or hereafter acquired or arising and wheresoever located, by

set-off or otherwise, on account of such Secured Obligation, (b) any redemption,

purchase or other acquisition of such Secured Obligation by Company or any of

its Subsidiaries (including CPIH Subsidiaries) or (c) the granting of any Lien

to or for the benefit of the holders of such Secured Obligation in or upon any

or all assets and properties of any kind whatsoever, real or personal, tangible

or intangible, or mixed, whether now owned or existing or hereafter acquired or

arising and wheresoever located of Company or any of its Subsidiaries (including

CPIH Subsidiaries).

"ENFORCEMENT ACTION" shall mean the exercise by any Secured Party of

any of the enforcement rights and remedies under, and subject to the provisions

of, the Collateral Documents at any time on or after an Event of Default,

including any or all of the following: any motion to vacate any stay on

enforcement of the Liens on the Collateral, solicitation of bids from third

parties to conduct the liquidation of Collateral, the engagement or retention of

third parties for the purposes of marketing, promoting or selling all or any

Collateral, the commencement of any action to foreclose on the Liens on any of

the Collateral, notification of account debtors to make payments to any Secured

Party or its agents, any action to take possession of any Collateral or the

commencement of any legal proceedings or actions seeking payment of any Secured

Obligations or otherwise in connection with the preservation or protection of

any of the Collateral, its value or any rights or remedies therein or otherwise

or as may be deemed necessary or appropriate to enhance the likelihood or

maximize the repayment of the Secured Obligations.

"EVENT OF DEFAULT" means a Detroit L/C Event of Default and/or a New

L/C Event of Default and/or a High Yield Event of Default.

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"FACILITY AGREEMENTS" means the New L/C Facility Agreement and

Detroit L/C Facility Agreement.

"FISCAL YEAR" means the fiscal year of the Company and its

Subsidiaries ending on December 31st of each calendar year.

"GOVERNING BODY" means the board of directors or other body having

the power to direct or cause the direction of the management and policies of a

Person that is a corporation, partnership, trust or limited liability company.

"HIGH YIELD EVENT OF DEFAULT" means an "Event of Default" under and

as defined in the High Yield Indenture.

"HIGH YIELD GUARANTORS" means the Subsidiaries of Company party from

time to time to the High Yield Indenture as guarantors thereunder.

"HIGH YIELD INDENTURE" means (i) the indenture pursuant to which the

High Yield Notes are issued and (ii) any replacement indenture entered into in

connection with a refinancing, defeasance, renewal, replacement or extension of

the High Yield Notes permitted under the Facility Agreements, in the case of

clause (i) or (ii), as such indenture or replacement indenture may be amended,

supplemented or otherwise modified from time to time to the extent permitted

under the Facility Agreements.

"HIGH YIELD NOTEHOLDERS" means the holders from time to time of the

High Yield Notes.

"HIGH YIELD NOTES" means (i) the $230,000,000 in aggregate principal

amount at maturity of 8.25% Senior Notes due 2010 of Company issued pursuant to

the High Yield Indenture, and (ii) any indebtedness incurred to refinance,

renew, replace or extend the High Yield Notes permitted to be incurred under the

Facility Agreements; provided, that the initial principal amount (and issue

price) of such High Yield Notes on the Closing Date shall be $205,000,000.

"HIGH YIELD OBLIGATIONS" means the obligations of Company and High

Yield Guarantors under the High Yield Indenture and the High Yield Notes, as

applicable.

"HIGH YIELD TRUSTEE" shall have the meaning assigned to that term in

the introduction to this Agreement.

"IPP INTERNATIONAL SALES" means one or more sales or dispositions of

(i) the assets and/or operations of CPIH and its Subsidiaries and/or (ii) the

Capital Stock of CPIH or any of its Subsidiaries.

"JUNIOR CREDITOR" shall have the meaning assigned to that term in

subsection 4.2(f).

"LENDERS" means New L/C Lenders and Detroit L/C Lenders.

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"LIEN" means any lien, mortgage, pledge, assignment, security

interest, charge or encumbrance of any kind (including any conditional sale or

other title retention agreement, any lease in the nature thereof, and any

agreement to give any security interest) and any option, trust or other

preferential arrangement having the practical effect of any of the foregoing.

"LOAN PARTIES" means Company, the other Borrowers, DHC, and High

Yield Guarantors.

"MANAGEMENT SERVICES AND REIMBURSEMENT AGREEMENT" means the

management services and reimbursement agreement entered into by CPIH, Company

and certain of their respective Subsidiaries on the Closing Date, in form and

substance satisfactory to the Detroit L/C Agents and New L/C Agent as such

agreement may be amended, restated, supplemented or otherwise modified from time

to time to the extent permitted thereunder and pursuant to subsection 2.5(c).

"MANAGEMENT SERVICES AND REIMBURSEMENT AGREEMENT BENEFICIARIES"

shall have the meaning assigned to that term in the introduction to this

Agreement.

"MANAGEMENT SERVICES AND REIMBURSEMENT AGREEMENT OBLIGORS" means the

"CPIH Entities" as such term is defined in the Management Services and

Reimbursement Agreement.

"MANDATORY PAYMENTS" means any amount described in subsections

2.3A(i)(a)-(f) of the Detroit L/C Facility Agreement or 2.4A(iii)(a)-(g) of the

New L/C Facility Agreement to be applied as a Mandatory Payment (as such term is

defined in each Facility Agreement).

"NET INSURANCE/CONDEMNATION PROCEEDS" means any cash payments or

Proceeds received by Company or any of its Subsidiaries (i) under any business

interruption or casualty insurance policy in respect of a covered loss

thereunder or (ii) as a result of the taking of any assets of Company or any of

its Subsidiaries by any Person pursuant to the power of eminent domain,

condemnation or otherwise, or pursuant to a sale of any such assets to a

purchaser with such power under threat of such a taking, in each case net of (a)

income taxes reasonably estimated to be actually payable prior to the earlier of

(1) the date which is eighteen months from the date of such receipt and (2)

March 10, 2009 as a result of the receipt of such payments of proceeds and (b)

any actual, reasonable and documented out-of-pocket fees and expenses (including

reasonable legal fees, reasonable fees to advisors and severance costs that are

due (pursuant to a Contractual Obligation, or written employment policy

applicable to terminated employees generally, of Company or any of its

Subsidiaries in effect prior to the event causing or relating to the payment

referred to in clause (i) or (ii) hereof or pursuant to applicable law) and

payable on or prior to the receipt of such payment or proceeds to employees of

Company and its Subsidiaries that have been terminated as a result of the

relevant loss, taking or sale) paid to Persons other than Company and its

Subsidiaries and their respective Affiliates in connection with the relevant

loss, taking or sale or the adjustment or settlement of any claims of Company or

such Subsidiary in respect thereof; provided, however, that Net

Insurance/Condemnation Proceeds shall be reduced in an amount equal to the

amount of proceeds Subsidiaries of Company are legally bound or required,

pursuant to Contractual Obligations in effect on the

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Closing Date, or which were entered into after the Closing Date with respect to

the financing or acquisition of a Project, to use for purposes other than a

Mandatory Payment.

"NEW INVESTOR ASSURANCES" means any collateral, insurance policy,

letter of credit or other financial assurances provided by any New Investor or

any of its Affiliates (other than Company or any of its Subsidiaries (including

CPIH Subsidiaries)) to New L/C Lenders in connection with the New L/C Facility

Agreement.

"NEW INVESTORS" means D.E. Shaw Laminar Portfolios, L.L.C., a

Delaware limited liability company, SZ Investments, L.L.C., a Delaware

limited liability company, and Third Avenue Trust, on behalf of Third Avenue

Value Fund Series.

"NEW L/C" or "NEW L/CS" means letters of credit issued or to be

issued (or deemed issued) by New L/C Issuing Lender pursuant to the New L/C

Facility Agreement, including amendments thereto.

"NEW L/C AGENT" shall have the meaning assigned to that term in the

introduction to this Agreement.

"NEW L/C AGGREGATE COMMITMENT" means one or more of the New

Revolving Loan Commitment or the New L/C Commitment or any combination thereof.

"NEW L/C AGGREGATE EXPOSURE" means, with respect to any New L/C

Lender as of any date of determination, the sum of (i) that New L/C Lenders' New

Revolving Loan Exposure and (ii) that New L/C Lender's New L/C Exposure.

"NEW L/C BORROWERS" shall have the meaning assigned to that term in

the introduction to this Agreement.

"NEW L/C CASH COLLATERAL ACCOUNT" means the cash collateral account

maintained with Collateral Agent pursuant to the Security Agreement to secure

the obligations of New L/C Borrowers with respect to New L/C Exposure.

"NEW L/C COMMITMENT" means the commitment of a New L/C Lender to

purchase and fund participations in New L/Cs pursuant to the New L/C Facility

Agreement.

"NEW L/C EVENT OF DEFAULT" means an "Event of Default" under and as

defined in the New L/C Facility Agreement.

"NEW L/C EXPOSURE" with respect to any New L/C Lender, means, as of

any date of determination, the sum of (a) in the event that New L/C Lender is a

New L/C Issuing Lender, the aggregate New L/C Usage in respect of all New L/Cs

issued by that New L/C Lender (in each case net of any participations purchased

by other New L/C Lenders in such New L/Cs or in any drawings thereunder not

theretofore reimbursed by New L/C Borrowers) plus (b) the aggregate amount of

all participations purchased by that New L/C Lender in any other outstanding New

L/Cs or any drawings under any such other New L/Cs not theretofore reimbursed by

New L/C Borrowers.

<PAGE>

"NEW L/C FACILITY AGREEMENT" means (i) that certain credit agreement

dated as of the date hereof by and among New L/C Borrowers, New L/C Lenders and

New L/C Agent, and (ii) any credit agreement entered into by New L/C Borrowers

to refinance, replace, renew or extend, in whole or in part, the credit

agreement referenced in clause (i) and the indebtedness and letters of credit

issued thereunder to the extent permitted pursuant to the Detroit L/C Facility

Agreement and the High Yield Indenture, in the case of clause (i) or (ii), as

such credit agreement may be amended, restated, supplemented or otherwise

modified from time to time to the extent permitted under subsection 2.5.

"NEW L/C FACILITY DOCUMENTS" means the "Credit Documents" as defined

in the New L/C Facility Agreement (or any comparable term with respect to any

replacement New L/C Facility Agreement not prohibited hereunder).

"NEW L/C ISSUING LENDER" means, with respect to any New L/C, the New

L/C Lender that agrees or is otherwise obligated to issue such New L/C,

determined as provided in the New L/C Facility Agreement.

"NEW L/C LENDER" shall have the meaning assigned to that term in the

introduction to this Agreement.

"NEW L/C OBLIGATIONS" means any and all Obligations to the extent

arising under or with respect to the New L/C Aggregate Commitments, New

Revolving Loans or the New L/Cs, including principal and interest on any New

Revolving Loans and the fees and other amounts accruing or otherwise owed with

respect to the New L/C Aggregate Exposure, and any drawings (and interest

accrued thereon) under New L/Cs not reimbursed by New L/C Borrowers; provided,

however, that Obligations of any Loan Party (other than DHC) for interest,

commitment fees or letter of credit fees with respect to the New L/Cs, New

Revolving Loans or New L/C Aggregate Commitments and that accrue or may be

incurred under any New L/C Facility Document after the commencement by or

against any Loan Party (other than DHC) of a Bankruptcy Proceeding shall be

included in New L/C Obligations solely to the extent recoverable from such Loan

Party or its estate in such proceeding.

"NEW L/C USAGE" means, as at any date of determination, the sum of

(i) the maximum aggregate amount which is or at any time thereafter may become

available for drawing under all New L/Cs then outstanding plus (ii) the

aggregate amount of all drawings under New L/Cs honored by Issuing Lenders and

not theretofore reimbursed by New L/C Borrowers.

"NEW REVOLVING LOAN COMMITMENT" means the commitment of a New L/C

Lender to make New Revolving Loans to the New L/C Borrowers pursuant to the New

L/C Facility Agreement.

"NEW REVOLVING LOAN EXPOSURE" with respect to any New L/C Lender,

means, as of any date of determination (i) prior to the termination of the New

Revolving Loan Commitments, that New L/C Lender's Revolving Loan Commitment, and

(ii) after the termination of the New Revolving Loan Commitments, the aggregate

outstanding principal amount of the New Revolving Loans of that New L/C Lender.

<PAGE>

"NEW REVOLVING LOANS" means loans made from time to time by New L/C

Lenders to New L/C Borrowers as "Revolving Loans" under and as defined in the

New L/C Facility Agreement.

"OBLIGATIONS" means all obligations of every nature of Loan Parties

under the Credit Documents, including any liability of such Loan Party on any

claim arising out of or relating to the Credit Documents, whether or not the

right to payment in respect of such claim is reduced to judgment, liquidated,

unliquidated, fixed or contingent, matured, disputed, undisputed, legal,

equitable, secured or unsecured, and whether or not such claim is discharged,

stayed or otherwise affected by any bankruptcy, insolvency, reorganization or

other similar proceeding. Without limiting the generality of the foregoing, the

Obligations of the Loan Parties under the Credit Documents include (a) the

obligation to pay principal, interest (including all interest which accrues

after the commencement of any case or proceeding in bankruptcy after the

insolvency of, or for the reorganization of, any Loan Party, whether or not

allowed in such case or proceeding), charges, expenses, fees, attorneys' fees

and disbursements, indemnities and other amounts payable by any Borrower and any

other Loan Party under any Credit Document and (b) the obligation to reimburse

any amount in respect of any of the foregoing that any Agent or any Lender, in

its sole discretion, may elect to pay or advance on behalf of such Borrower or

other Loan Party; provided, that nothing in this definition shall be construed

as creating any obligations of DHC under the Credit Documents that are not

expressly set forth in such Credit Documents.

"OFFICER'S CERTIFICATE" means, as applied to any Person that is a

corporation, partnership, trust or limited liability company, a certificate

executed on behalf of such Person by one or more Officers of such Person or one

or more Officers of a general partner or a managing member if such general

partner or managing member is a corporation, partnership, trust or limited

liability company.

"PAYMENT IN FULL" and "PAID IN FULL" means (a) as to the Detroit L/C

Obligations, the payment and satisfaction in full in immediately available funds

of all of such funded Detroit L/C Obligations and either (i) the termination of

the Detroit L/C Commitments and the receipt by Collateral Agent of cash

collateral in the Detroit L/C Cash Collateral Account in an amount equal to one

hundred five (105%) percent of the aggregate Detroit L/C Usage then outstanding

or (ii) if the Detroit L/C Commitments have not been terminated, the receipt by

Collateral Agent of cash collateral in the Detroit L/C Cash Collateral Account

in an amount equal to 105% of the Detroit L/C Commitments of all Detroit L/C

Lenders, (b) as to the New L/C Obligations, the payment and satisfaction in full

in immediately available funds of all of such funded New L/C Obligations and

either (i) the termination of the New L/C Aggregate Commitments and the receipt

by Collateral Agent of cash collateral in the New L/C Cash Collateral Account in

an amount equal to one hundred five (105%) percent of the aggregate New L/C

Usage then outstanding or (ii) if the New L/C Aggregate Commitments have not

been terminated, the receipt by Collateral Agent of cash collateral in the New

L/C Cash Collateral Account in an amount equal to 105% of the New L/C

Commitments of all New L/C Lenders, (c) as to the High Yield Obligations, the

payment and satisfaction in full in immediately available funds of all of such

High Yield Obligations and the termination or defeasance (whether legally or as

to covenants only) of the financing arrangements provided by any High Yield

Noteholder to the Loan Parties (other than DHC) with respect thereto, and (d) as

to any other Secured

<PAGE>

Obligations, the payment and satisfaction in full in immediately available funds

of all such Secured Obligations then due and payable. If after receipt of any

payment of, or Proceeds of Collateral applied to the payment of, any of the

Secured Obligations, Collateral Agent or any other Secured Party, as applicable,

is required to surrender or return such payment or Proceeds to any Person for

any reason, then the Secured Obligations intended to be satisfied by such

payment or Proceeds shall be reinstated and continue and this Agreement shall

continue in full force and effect as if such payment or Proceeds had not been

received by Collateral Agent or such other Secured Party, as the case may be.

"PARTIES" means the High Yield Trustee, Loan Parties, and the

Creditor Parties from time to time party to this Agreement.

"PERSON" or "PERSONS" means and include natural persons,

corporations, limited partnerships, general partnerships, limited liability

companies, limited liability partnerships, joint stock companies, Joint Ventures

(as defined in the Facility Agreements), associations, companies, trusts, banks,

trust companies, land trusts, business trusts or other organizations, whether or

not legal entities, and governments (whether federal, state or local, domestic

or foreign, and including political subdivisions thereof) and agencies or other

administrative or regulatory bodies thereof.

"PLAN OF REORGANIZATION" means the Debtors' Second Joint Plan of

Reorganization under Chapter 11 of the Bankruptcy Code as filed with the

Bankruptcy Court on January 14, 2004 (and as revised and amended through March

2, 2004), together with the Reorganization Plan Supplement to Debtors' Second

Joint Plan of Reorganization filed with the Bankruptcy Court on February 18,

2004 in connection therewith.

"POTENTIAL EVENT OF DEFAULT" means a "Potential Event of Default"

under and as defined in the Detroit L/C Facility Agreement, a "Potential Event

of Default" under and as defined in the New L/C Facility Agreement or a

"Default" under and as defined in the High Yield Indenture.

"PROCEEDS" means "proceeds", as such term is defined in the UCC and,

in any event, shall include (i) any and all proceeds of any insurance,

indemnity, warranty or guaranty payable to any of the Loan Parties or Collateral

Agent from time to time with respect to any of the Collateral, (ii) any and all

payments (in any form whatsoever) made or due and payable to any of the Loan

Parties from time to time in connection with any requisition, confiscation,

condemnation, seizure or forfeiture of all or any part of the Collateral, by any

governmental body, authority, bureau or agency (or any person acting under color

of governmental authority), and (iii) any and all other consideration (in any

form whatsoever) or other amounts from time to time paid or payable under or in

connection with any of the Collateral upon disposition or otherwise.

"PROJECT" means any waste-to-energy facility, electrical generation

plant, cogeneration plant, water treatment facility or other facility for the

generation of electricity or engaged in another line of business in which

Company and its Subsidiaries are permitted to be engaged hereunder for which a

Subsidiary or Subsidiaries of Company (including CPIH Subsidiaries) was, is or

will be (as the case may be) an owner, operator, manager or builder, and

<PAGE>

shall also mean any two or more of such plants or facilities in which an

interest has been acquired in a single transaction, so long as such interest

constitutes an existing Investment on the Closing Date permitted under this

Agreement; provided, however, that a Project shall cease to be a Project of

Company and its Subsidiaries at such time that Company or any of its

Subsidiaries ceases to have any existing or future rights or obligations

(whether direct or indirect, contingent or matured) associated therewith.

"REQUISITE DETROIT L/C LENDERS" means Detroit L/C Lenders having or

holding more than 50% of the Detroit L/C Exposure of all Detroit L/C Lenders;

provided, however, that prior to the Closing Date, for purposes of this

definition the Detroit L/C Exposure of each Detroit L/C Lender shall equal the

original Detroit L/C Commitment of such Detroit L/C Lender on the Closing Date.

"REQUISITE NEW L/C LENDERS" means New L/C Lenders having or holding

more than 50% of the New L/C Aggregate Exposure of all New L/C Lenders;

provided, however, that prior to the Closing Date, for purposes of this

definition the New L/C Aggregate Exposure of each New L/C Lender shall equal the

original New L/C Commitment of such New L/C Lender on the Closing Date.

"REQUISITE OBLIGEES" means,

(i) until such time as all Detroit L/C Obligations are Paid in Full

under clause (a)(i) of the definition thereof and no Detroit L/Cs or other

Detroit L/C Obligations are outstanding, for purposes of any exercise of any

Enforcement Action or other rights with respect to the Detroit L/C Cash

Collateral Account and any Collateral from time to time on deposit therein

(including any application thereof), Requisite Detroit L/C Lenders;

(ii) until such time as all New L/C Obligations are Paid in Full and

no New L/Cs or other New L/C Obligations are outstanding, for purposes of any

exercise of any Enforcement Action or other rights with respect to the New L/C

Cash Collateral Account and any Collateral from time to time on deposit therein

(including any application thereof), Requisite New L/C Lenders;

(iii) subject to clauses (i) and (ii) above, until Payment in Full

of all Detroit L/C Obligations, (a) for so long as no drawing has occurred under

any Detroit L/C, no Event of Default has occurred and is continuing under

subsection 8.1 of the Detroit L/C Facility Agreement and no Bankruptcy

Proceeding has been commenced by or against any Loan Party, Lenders having or

holding of more than 50% of the sum of (1) the aggregate Detroit L/C Exposure of

all Detroit L/C Lenders and (2) the aggregate New L/C Aggregate Exposure of all

New L/C Lenders, and (b) from and after the occurrence of any drawing under any

Detroit L/C which is not reimbursed in full by Detroit L/C Borrowers, the

occurrence and continuance of a Detroit L/C Event of Default under subsection

8.1 of the Detroit L/C Facility Agreement or the commencement of a Bankruptcy

Proceeding by or against any Loan Party, Requisite Detroit L/C Lenders;

<PAGE>

(iv) subject to clauses (i) and (ii) above, from and after Payment

in Full of all Detroit L/C Obligations and until Payment in Full of all New L/C

Obligations, Requisite New L/C Lenders; and

(v) subject to clauses (i) and (ii) above, from and after Payment in

Full of all Detroit L/C Obligations and New L/C Obligations, holders of more

than 50% of the aggregate outstanding principal amount of the High Yield Notes.

"SECURED PARTIES" means the Creditor Parties, the High Yield

Noteholders and the High Yield Trustee.

"SECURED OBLIGATIONS" means the collective reference to all Detroit

L/C Obligations, all New L/C Obligations, all High Yield Obligations and all

Obligations owing to Collateral Agent hereunder or under any Collateral

Document, and all Cash Management Obligations.

"SECURITIES" means any stock, shares, partnership interests, voting

trust certificates, certificates of interest or participation in any

profit-sharing agreement or arrangement, options, warrants, bonds, debentures,

notes, or other evidences of indebtedness, secured or unsecured, convertible,

subordinated, certificated or uncertificated, or otherwise, or in general any

instruments commonly known as "securities" or any certificates of interest,

shares or participations in temporary or interim certificates for the purchase

or acquisition of, or any right to subscribe to, purchase or acquire, any of the

foregoing.

"SECURITIES ACCOUNT" means an account to which a financial asset is

or may be credited in accordance with an agreement under which the Person

maintaining the account undertakes to treat the Person for whom the account is

maintained as entitled to exercise the rights that comprise the financial asset.

"SECURITY AGREEMENT" means the Security Agreement executed and

delivered by Borrowers on the Closing Date pursuant to the Detroit L/C Facility

Agreement, New L/C Facility Agreement and High Yield Indenture, as such

agreement may from time to time hereafter be amended, restated, supplemented or

otherwise modified to the extent permitted pursuant to subsection 2.4.

"SENIOR AGENT" means, (i) until Payment in Full of all Detroit L/C

Obligations, Detroit L/C Facility Agent and (ii) from and after Payment in Full

of all Detroit L/C Obligations and until Payment in Full of all New L/C

Obligations, New L/C Agent, and (iii) after Payment in Full of all Detroit L/C

Obligations and New L/C Obligations, High Yield Trustee.

"SENIOR CREDITOR" shall have the meaning assigned to that term in

subsection 4.2(f).

"SUBJECT FISCAL YEAR" shall have the meaning assigned to that term

in subsection 4.1(b).

"SUBSIDIARY" means, with respect to any Person, any corporation,

partnership, trust, limited liability company, association, joint venture or

other business entity of which more

<PAGE>

than 50% of the total voting power of shares of stock or other ownership

interests entitled (without regard to the occurrence of any contingency) to vote

in the election of the members of the Governing Body is at the time owned or

controlled, directly or indirectly, by that Person or one or more of the other

Subsidiaries of that Person or a combination thereof. Any reference contained

herein to one or more Subsidiaries of Company shall, unless otherwise expressly

indicated, not include CPIH or any of its Subsidiaries.

"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to that

term in subsection 6.1(c).

"THIRD-PARTY GUARANTY" shall have the meaning assigned to that term

in subsection 4.2(i).

"UCC" means the Uniform Commercial Code as the same may, from time

to time, be in effect in the State of New York; provided, however, in the event

that, by reason of mandatory provisions of law, the priority of any Secured

Party's security interest in any Collateral is governed by the Uniform

Commercial Code as in effect in a jurisdiction other than the State of New York,

the term "UCC" means the Uniform Commercial Code as in effect in such other

jurisdiction for purposes of the provisions hereof relating to such priority and

for purposes of definitions related to such provisions.

"UNITED STATES" means the United States of America.

1.2 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION.

(a) Any of the terms defined herein may, unless the context

otherwise requires, be used in the singular or the plural, depending on

the reference.

(b) References to "Sections" and "subsections" shall be to Sections

and subsections, respectively, of this Agreement unless otherwise

specifically provided.

general statement, term or matter, shall not be construed to limit such

statement, term or matter to the specific items or matters set forth

immediately following such word or to similar items or matters, whether or

not nonlimiting language (such as "without limitation" or "but not limited

to" or words of similar import) is used with reference thereto, but rather

shall be deemed to refer to all other items or matters that fall within

the broadest possible scope of such general statement, term or matter.

(d) In the event of any refinancing, replacement or extension of any

Facility Agreement, references in this Agreement to sections or

subsections of such Facility Agreement shall refer to the functionally

equivalent sections or subsections in such refinanced, replaced or

extended agreement as the context requires.

SECTION II

2.1 APPOINTMENT AS COLLATERAL AGENT. Each Creditor Party executing

this Agreement, and High Yield Trustee and each High Yield Noteholder, by its

acceptance of the

<PAGE>

benefits of the Collateral Documents and of this Agreement, (i) appoints Bank of

America to serve as collateral agent and representative of each such Secured

Party (to the extent applicable) under this Agreement and each of the Collateral

Documents (in such capacity, together with its successors in such capacity, the

"COLLATERAL AGENT") and (ii) irrevocably authorizes Collateral Agent to act as

agent for the Secured Parties for the purpose of executing and delivering, on

behalf of all such Secured Parties, the Collateral Documents and, subject to the

provisions of this Agreement, for the purpose of exercising such powers, rights

and remedies hereunder and under the other Collateral Documents as are

specifically delegated or granted to Collateral Agent by the terms hereof and

thereof, together with such powers, rights and remedies as are reasonably

incidental thereto. For the avoidance of doubt, it is understood and agreed that

the Collateral Agent is the "Secured Party" or, as the case may be, the

"Mortgagee" referred to in the Collateral Documents. Each Creditor Party and

Collateral Agent, and High Yield Trustee and each High Yield Noteholder, by its

acceptance of the benefits of the Collateral Documents and this Agreement,

hereby appoint each other Secured Party as agent for the purpose of perfecting

Collateral Agent's security interest in Collateral that, in accordance with the

UCC, can be perfected by possession or control.

2.2 DECISIONS RELATING TO ENFORCEMENT ACTIONS AND OTHER MATTERS

VESTED IN REQUISITE OBLIGEES.

(a) Collateral Agent agrees to take such Enforcement Actions and all

such actions with respect to Collateral which is perfected only by control

of such Collateral, in each case as may be directed by Requisite Obligees

(it being understood and agreed that if at any time Collateral Agent

determines that the requisite percentages constituting Requisite Obligees

shall have been obtained, the Collateral Agent may and shall be fully

authorized, as of such time and without the need for further direction

from any Secured Party, to take or not take such action as the Requisite

Obligees direct); provided, however, that notwithstanding anything in this

Agreement to the contrary, Collateral Agent shall not be required to take

any action that is in its judgment contrary to law or to the terms of this

Agreement or any or all of the Collateral Documents or which would in its

opinion subject it or any of its officers, employees or directors to

liability, and Collateral Agent shall not be required to take any action

under this Agreement or any or all of the Collateral Documents unless and

until Collateral Agent shall be indemnified to its satisfaction by the

relevant Parties against any and all losses, costs, expenses or

liabilities in connection therewith.

(b) Each Creditor Party executing this Agreement or an

acknowledgment hereto, and the High Yield Trustee and each holder of a

High Yield Note, by its acceptance of the benefits hereof and of the

Collateral Documents, agree that Collateral Agent may act as Requisite

Obligees may request (regardless of whether any individual Party or any

other Secured Party (including the holders of the High Yield Notes)

agrees, disagrees or abstains with respect to such request), that

Collateral Agent shall have no liability for acting in accordance with

such request (provided such action does not conflict with the express

terms of this Agreement) and that no Secured Party shall have any

liability to any other Secured Party for any such request, except, in each

case, liability arising from the gross negligence or willful misconduct of

such Person. Collateral Agent shall give prompt notice to all Creditor

Parties and the High Yield

<PAGE>

Trustee of actions taken pursuant to the instructions of Requisite

Obligees; provided, however, that the failure to give any such notice

shall not impair the right of Collateral Agent to take any such action or

the validity or enforceability under this Agreement and the applicable

Collateral Documents of the action so taken.

Requisite Obligees with respect to the Collateral Documents as to any

course of action or other matter relating hereto or to the Collateral

Documents. Except as otherwise provided in the Collateral Documents,

directions given by Requisite Obligees to Collateral Agent with respect to

the Collateral and Collateral Documents shall be binding on all Secured

Parties for all purposes (provided such directions do not conflict with

the express terms of this Agreement).

(d) Each Creditor Party, the High Yield Trustee, and each holder of

a High Yield Note, by accepting the benefits hereof and of the Collateral

Documents, agrees not to take any Enforcement Action whatsoever, in each

case except through Collateral Agent in accordance with this Agreement;

provided, however, that (i) Detroit L/C Agents and Detroit L/C Lenders may

apply Collateral on deposit in the Detroit L/C Cash Collateral Account to

the paym

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