COGENTRIX AMENDMENT TO AMENDED AND RESTATED LIMITED
             PARTNERSHIP AGREEMENT OF INDIANTOWN COGENERATION, L.P.

This AMENDMENT TO AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT dated as of
August 10, 1998 (this Amendment), is made and entered into by
and    among    PALM    POWER     CORPORATION,     a    Delaware     corporation
(Palm),   TOYAN   ENTERPRISES,   a   California   corporation
(Toyan),   and  TIFD  III-Y  INC.,  a  Delaware   corporation
(TIFD,   and   collectively   with   Palm  and   Toyan,   the
Partners).

WHEREAS,  the Partners are parties to that certain Amended and Restated  Limited
Partnership  Agreement  dated as of  September  30, 1992 (the  Partnership
Agreement); and

WHEREAS,  the Partners are partners in a Delaware limited  partnership  known as
INDIANTOWN COGENERATION, L.P. (the Partnership)  formed under
the Partnership Agreement for the purposes described therein; and

WHEREAS, Bechtel Generating Company, Inc.  (BGCI) owns all of
the  capital  stock of Palm;  and

WHEREAS,  pursuant to that certain Purchase  Agreement dated as of March 6, 1998
by and between BGCI and Cogentrix Energy,  Inc.  (Cogentrix),
as amended (the Purchase Agreement), BGCI has agreed to sell,
and Cogentrix has agreed to purchase and accept through an indirect wholly owned
subsidiary  that  has not yet  been  formed,  all of the  capital  stock of Palm
subject to the terms and  conditions set forth in the Purchase  Agreement  (such
sale, the Proposed Sale); and

WHEREAS, Toyan intends,  through a series of related transfers,  to transfer its
BOC Partner Rights and a portion of its Interest in the  Partnership  (together,
the   DCC   XII    Transfer)   to   a   new   partnership   (the
Indiantown   Project   Investment   Partnership)   that  will
initially have Toyan as its sole general partner and DCC Project Finance Twelve,
Inc., a wholly-owned  subsidiary of Dana Commercial Credit  Corporation,  as its
sole limited partner; and


WHEREAS, in connection with the DCC XII Transfer, the Partners may enter into an
amendment    to   the    Partnership    Agreement    (the    DCC    XII
Amendment),  portions  of  which  shall  be  effective  only  upon the
formation of the Indiantown Project Investment Partnership, the execution of the
DCC XII  Amendment  and the closing of the DCC XII  Transfer,  all as and to the
extent set forth in the DCC XII Amendment; and

WHEREAS,  the  Partners  desire to amend the  Partnership  Agreement  in certain
respects in connection with the Proposed Sale;

NOW THEREFORE in  consideration  of the premises and of the mutual covenants and
agreements herein, and of other good and valuable consideration, the receipt and
sufficiency  of which are hereby  acknowledged,  the  Partners  intending  to be
legally bound, hereby agree as follows:

Amendments  to the  Partnership  Agreement.  Effective  as of the time  when the
Proposed  Sale shall have closed,  and without  regard to whether any portion of
the DCC XII  Amendment  is then  effective  or ever will become  effective,  the
Partnership Agreement shall be amended as follows:

Section 1.7 is hereby amended to include the following terms:

> PG&E  Corp.  means (i) PG&E Corporation, a
>      California corporation, (ii) any corporation that succeeds to substantially
>      all the assets and liabilities of PG&E Corporation and (iii) any Person
>      who  directly  or  indirectly  owns at least 80% of the  voting  stock of a
>      corporation described in clause (i) or (ii)."
> 
>          
> 
>      Cogentrix means (i) Cogentrix Energy, Inc., a North
>      Carolina  corporation,  (ii) any corporation that succeeds to substantially
>      all the assets and  liabilities  of  Cogentrix  Energy,  Inc. and (iii) any
>      Person who directly or indirectly  owns at least 80% of the voting stock of
>      a corporation described in clause (i) or (ii)."
> 
>          
> 
>      PG&E  Corp.-Cogentrix Affiliate  means (i) any
>      partnership  in  which  Persons  directly  or  indirectly  wholly  owned by
>      PG&E   Corp.,   Cogentrix  or  both  are  general   partners  with  the
>      unrestricted  collective voting power sufficient in and of itself to direct
>      the  management  and  policies of such  partnership  (other than  specified
>      matters for which the approval of other partners may be required), (ii) any
>      corporation   more  than  50%  of  the  voting  stock  of  which  is  owned
>      collectively or individually by Persons directly or indirectly wholly owned
>      by PG&E Corp.,  Cogentrix or both,  which Persons have the unrestricted
>      collective  voting  power  sufficient  in  and  of  itself  to  direct  the
>      management and policies of such corporation  (other than specified  matters
>      for which the approval of other shareholders may be required), or (iii) any
>      Person directly or indirectly  wholly owned by a Person described in clause
>      (i) or (ii).

Section 6.1(b) shall be amended to delete the names Joseph P. Kearney and
John R.  Cooper,  and to reflect  that  Palm's  representatives  on the Board of
Control shall be Thomas J. Bonner and Thomas F. Schwartz.Section 6.9(a) shall be amended and restated in its entirety as follows:

> 6.9  Dispute  Resolution.    (a)  The  Dispute
>      Resolution  Committee  shall  consist  of  the  persons  holding  the
>      following  offices:  (i) the president of Cogentrix;  (ii) the president of
>      U.S. Gen.  Power Group LLC; and (iii) the president of GE Capital  Services
>      Structured  Finance  Group,  Inc.  Any entity  represented  on the  Dispute
>      Resolution  Committee may substitute a person having authority greater than
>      or equal to the authority of the persons holding the offices  designated in
>      this Section  6.9(a).  Any member of the Dispute  Resolution  Committee may
>      bring one or more colleagues knowledgeable about the Project to any meeting
>      of the Dispute  Resolution  Committee,  but no such  colleague may serve or
>      vote  as  a  member  of  the  Dispute  Resolution   Committee  unless  such
>      colleagues authority is greater than or equal to the authority of the
>      person holding the office designated in this Section 6.9(a).

> (1)  in whole or in part,  to (A) a  corporation  at least 80% of the
>      voting stock of which is owned by such  Partner,  (B) a  corporation  which
>      owns at least 80% of the voting stock of such Partner, (C) a corporation at
>      least 80% of the voting stock of which is owned  directly or  indirectly by
>      Persons which  collectively own, directly or indirectly,  80% of the voting
>      stock of such  Partner,  (D) a  corporation  into which such Partner  shall
>      merge or with which it shall  consolidate  or to which it shall sell all or
>      substantially  all of its assets,  if after such merger,  consolidation  or
>      sale, at least 80% of the voting stock of such  continuing  corporation  is
>      owned  directly or indirectly by Persons which held  (immediately  prior to
>      such transaction), directly or indirectly, at least 80% of the voting stock
>      of such Partner or (E) a PG&E Corp.-Cogentrix Affiliate.

> (3)  in  whole or in part to a  limited  partnership  in  which  such
>      Partner,  a corporation  having a relationship to such Partner described in
>      Section 7.1 (a) (2) above or a PG&E  Corp.-Cogentrix  Affiliate  is the
>      sole  general  partner;  but only if (A) the sale or other  disposition  of
>      limited  partnership  interests and  admission of limited  partners in such
>      partnership  prior to or at the time of such  Transfer  shall have complied
>      with the conditions and  restrictions  set forth in Section 9.1 (whether or
>      not such  partnership was a Partner at the time of such  disposition),  (B)
>      the partnership  agreement for such  partnership  complies with Section 9.2
>      and (C) the limited  partners in such  partnership do not have the right to
>      participate  in the  appointment  or removal of, or in the  formulation  of
>      instructions given to, such partnerships  representatives, if any, on
>      the Board of Control.

> (1)  Assignments  by Limited  Partners.  A Limited Partner may
>      Assign all or a portion of its Limited  Partner  Interest only (x) to (A) a
>      corporation  at  least  80% of the  voting  stock  of which is owned by the
>      Limited  Partner,  (B) a corporation  which owns at least 80% of the voting
>      stock of such Limited Partner, (C) a corporation at least 80% of the voting
>      stock of which is owned by Persons  which  collectively  own,  directly  or
>      indirectly, at least 80% of the voting stock of such Limited Partner, (D) a
>      corporation  into which such Limited  Partner  shall merge or with which it
>      shall consolidate or to which it shall sell all or substantially all of its
>      assets,  if after such merger,  consolidation  or sale, at least 80% of the
>      voting stock of such continuing corporation is owned directly or indirectly
>      by  Persons   which   collectively   owned   (immediately   prior  to  such
>      transaction),  directly or indirectly,  at least 80% of the voting stock of
>      such Limited Partner, or (E) a PG&E  Corp.-Cogentrix  Affiliate, or (y)
>      to a transferee  whose  identity has been approved by the Board of Control,
>      which  approval  shall  not  be  unreasonably  withheld;   provided,
>      however,  that  such  approval  may be in  the  form  of a  list  of
>      permitted transferees pre-approved from time to time by action of the Board
>      of Control,  such list to be kept with the records of the Partnership;  and
>      in each case only if:"

> (b) A Second Tier Owner may  Transfer  all or a portion of its Second
>      Tier  Interest  only to (x) (1) a  corporation  at least 80% of the  voting
>      stock of which is owned by the Second Tier Owner,  (2) a corporation  which
>      owns at least 80% of the voting  stock of such  Second  Tier  Owner,  (3) a
>      corporation  at least 80% of the voting  stock of which is owned by Persons
>      which collectively own, directly or indirectly,  at least 80% of the voting
>      stock of such Second Tier Owner,  (4) a corporation  into which such Second
>      Tier owner  shall merge or with which it shall  consolidate  or to which it
>      shall sell all or  substantially  all of its assets,  if after such merger,
>      consolidation  or sale, at least 80% of the voting stock of such continuing
>      corporation is owned  directly or indirectly by Persons which  collectively
>      owned (immediately prior to such transaction),  directly or indirectly,  at
>      least 80% of the voting stock of such Second Tier Owner,  or (5) a PG&E
>      Corp.-Cogentrix  Affiliate,  or (y) any  Person  whose  identity  has  been
>      approved in advance by the Board of Control,  which  approval  shall not be
>      unreasonably withheld;  provided, however, that such approval may be in the
>      form of a list of permitted  transferees  pre-approved from time to time by
>      action of the Board of  Control,  such list to be kept with the  records of
>      the Partnership; and in each case only if,

Section  11.4  shall be  amended  to delete  the  notice  address of U.S.
Generating  Company and to reflect  that copies of notices sent to Palm shall be
sent to:

             
             

                      Palm Power Corporation

             
             

                      c/o Cogentrix Energy, Inc.

             
             
                      9405 Arrowpoint Blvd.


             
             
                      Charlotte, NC  28273


             
             
                      Attn:  Senior Vice President - Finance and Treasurer

with a copy to:

             
             

                      Cogentrix Energy, Inc.

             
             
                      9405 Arrowpoint Blvd.

             
             
                      Charlotte, NC  28273

             
             
                      Attn:  General Counsel

         

     Board of Control  Consent.  The Board of Control of the  Partnership
shall be deemed to have  consented  to the sale of the capital  stock of Palm to
Buyer and the other transactions contemplated by the Purchase Agreement.

         
     Governing  Law. This Amendment shall be governed by and construed in
accordance  with the laws of the State of Delaware,  without regard to any other
applicable conflict of law provisions.

         
     Amendments.  This Amendment may not be amended, altered, modified or
revoked without the prior written consent of both parties.

         
     Headings.  All  headings in this  Amendment  are  included  only for
convenience   and  ease  of  reference  and  shall  not  be  considered  in  the
construction and interpretation of any provision hereof.

         
     Further  Obligations.  Each of the parties  hereto agrees to execute
all other agreements,  instruments and documents and to perform all further acts
which may be necessary to consummate the transactions contemplated herein.

         
     Binding Nature and Benefit. This Amendment shall be binding upon and
inure to the benefit of each party hereto and their  respective  successors  and
assignors.

         
     Counterparts.   This   Amendment   may  be   executed   in  multiple
counterparts,  each of which shall be deemed an original for all  purposes,  but
all of which together shall constitute one and the same instrument.


IN WITNESS  WHEREOF,  the parties have caused this Amendment to be duly executed
and delivered as of the day and year first above written.

`TOYAN ENTERPRISES, a California
                                         corporation



                                         By:    _______________________________
                                         Name:  _______________________________
                                         Title: _______________________________


                                         TIFD III-Y INC., a Delaware corporation



                                         By:    _______________________________
                                         Name:  _______________________________
                                         Title: _______________________________


                                            PALM POWER CORPORATION, a Delaware
                                            corporation



                                         By:    _______________________________
                                         Name:  _______________________________
                                         Title: _______________________________`