THIRD AMENDMENT TO THE


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


        THIS THIRD  AMENDMENT  TO THE AMENDED AND RESTATED  LIMITED  PARTNERSHIP
AGREEMENT OF INDIANTOWN COGENERATION,  L.P. (this "Third Amendment") dated as of
the 4th day of June,  1999 by and  among  PALM  POWER  CORPORATION,  a  Delaware
corporation ("Palm"),  TOYAN ENTERPRISES,  a California  corporation  ("Toyan"),
INDIANTOWN PROJECT INVESTMENT PARTNERSHIP,  L.P., a Delaware limited partnership
("IPIP"),  TIFD III-Y INC., a Delaware corporation ("TIFD") and THALEIA,  LLC, a
Delaware  limited  liability  company  ("Thaleia" and together with Palm,  IPIP,
Toyan and TIFD, the "Partners").


                              STATEMENT OF PURPOSE

        WHEREAS,  Partners  are parties to that  certain  Amended  and  Restated
Limited   Partnership   Agreement  of   Indiantown   Cogeneration,   L.P.   (the
"Partnership")  dated  September  30,  1992 (as  amended by the First  Amendment
thereto,  dated as of November 1, 1994,  the Cogentrix  Amendment  thereto dated
August 10,  1998 and the Dana  Amendment  thereto  dated  August 10,  1998,  the
"Agreement").

        WHEREAS,  TIFD is the  owner  of a 40%  limited  partner  interest  (the
"Partnership  Interest") in the Partnership,  which limited partnership interest
includes BOC Partner Rights.

        WHEREAS, pursuant to that certain Purchase Agreement dated as of June 3,
1999 by and between Thaleia and TIFD (the "Purchase Agreement"), TIFD has agreed
to sell, and Thaleia has agreed to purchase the Partnership Interest,  including
the BOC Partner Rights, in three  installments as follows:  at the First Closing
(as defined in the Purchase Agreement),  Thaleia shall purchase a 19.9% interest
in  the  Partnership,  at  the  Second  Closing  (as  defined  in  the  Purchase
Agreement),   Thaleia  shall  purchase  a  20.0%  interest  in  the  Partnership
(including  the BOC Partner  Rights held by TIFD),  and at the Third Closing (as
defined in the Purchase  Agreement),  Thaleia shall  purchase a 0.1% interest in
the Partnership,  in each case, subject to the terms and conditions set forth in
the Purchase Agreement (such sale, the "Proposed Sale").

        WHEREAS,  Thaleia is a  wholly-owned  indirect  subsidiary  of Cogentrix
Energy, Inc. and, as such,  qualifies as a PGE  Corp.-Cogentrix  Affiliate under
the Agreement.

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

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                                    AGREEMENT

        NOW,  THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency  of which are hereby  acknowledged,  the  Partners  intending  to be
legally bound, hereby agree as follows:

     1. Certain Terms.  All  capitalized  terms used herein  without  definition
shall have the meanings assigned thereto in the Agreement.

     2. Effective  Date. This Agreement shall be effective as of the date hereof
except for the provisions  set forth in Sections 3(a),  (c), (d), (e), (f), (g),
(h) and (j),  which shall become  effective as of the Second Closing (as defined
in the Purchase Agreement).

     3. Amendments to Agreement.

        (a) The  definition  of "BOC Partner" in Section 1.7 of the Agreement is
hereby amended by deleting the name "TIFD" in  subsections  (i) and (ii) thereof
and adding Thaleia in lieu thereof.

        (b)  Section  1.7 of the  Agreement  is hereby  amended to  include  the
following  term:  "Thaleia"  means  Thaleia  LLC, a Delaware  limited  liability
company.

        (c) Section  6.1(b) of the  Agreement is hereby  amended by deleting the
phrase  "TIFD  Representatives:   Robert  E.  Maxwell  and  Michael  Tzougrakis"
therefrom and adding the phrase "Thaleia  Representatives:  Thomas J. Bonner and
Thomas F. Schwartz" in lieu thereof.

        (d) Section  6.9(a) of the  Agreement is hereby  amended by deleting the
semicolon  at the end of  subparagraph  (i) thereof and adding the word "and" in
lieu thereof.

        (e)  Section  6.9(a) of the  Agreement  is  hereby  further  amended  by
deleting the phrase "; and (iii) the president of GE Capital Services Structured
Finance Group, Inc." therefrom and adding a period in lieu thereof.

        (f) Section 6.9(c) of the Agreement is hereby deleted in its entirety.

        (g) Section  6.10(a) of the Agreement is hereby  amended by deleting the
name "TIFD" in the third and eighth lines  thereof and adding  "Thaleia" in lieu
thereof.

        (h) Section  6.10(b) of the Agreement is hereby  amended by deleting the
name "TIFD" in the third line thereof and adding "Thaleia" in lieu thereof.

        (i)    Section 11.4 of the Agreement is hereby amended by adding the
following after the notice address of TIFD therein:

"Thaleia                     Thaleia, LLC
                             c/o Cogentrix Energy, Inc.
                             9405 Arrowpoint Boulevard
<PAGE>

                             Charlotte, North Carolina 28273
                             Attn:  Senior Vice President-Finance and Treasurer

        with a copy to:      Cogentrix Energy, Inc.
                             9405 Arrowpoint Boulevard
                             Charlotte, North Carolina 28273
                             Attn:  General Counsel"

        (j)    Section 11.4 of the Agreement is hereby amended by deleting the
notice address of TIFD therefrom.

        4. Admission and Withdrawal of Partners. Effective at the time the First
Closing shall have been consummated, Thaleia is admitted as a Partner and agrees
to be bound by the terms and conditions of the Agreement.  Effective at the time
the Third Closing shall have been consummated, TIFD withdraws as a Partner.

        5. Board of  Control  Consent.  The Board of Control of the  Partnership
shall be deemed to have  consented  to the sale of the  Partnership  Interest to
Thaleia and the other transactions contemplated by the Purchase Agreement.

        6. 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.

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

        8.  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.

        9. 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.

        10. 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.

        11.   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.




<PAGE>


        IN WITNESS WHEREOF,  the parties hereto have caused this Third Amendment
to be duly executed by their duly authorized officers,  all as of the date first
above written.

                           PALM:
                                       PALM POWER CORPORATION

                                       By:________________________________
                                          Name:
                                          Title:

                                       TOYAN:

                                           TOYAN ENTERPRISES

                                       By:________________________________
                                          Name:
                                          Title:

                                       TIFD:

                                          TIFD III-Y INC.



                                           By:________________________________
                                              Name:
                                              Title:

                                       THALEIA:

                                           THALEIA, LLC

                                           By:________________________________
                                              Name:
                                              Title:


                                    INDIANTOWN PROJECT INVESTMENT
                                    PARTNERSHIP, L.P.:

                                    By:________________________________
                                       Name:
                                       Title: