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                                                                    EXHIBIT 4.24

                                   EXHIBIT XI

                      [FORM OF DHC STOCK PLEDGE AGREEMENT]

                                PLEDGE AGREEMENT

                  This PLEDGE AGREEMENT (this "AGREEMENT") is dated as of March
__, 2004 and entered into by and between DANIELSON HOLDING CORPORATION, a
Delaware corporation (the "PLEDGOR") and BANK OF AMERICA, N.A., in its capacity
as collateral agent for and representative of the Secured Parties (as defined in
the Intercreditor Agreement referred to below) (the "COLLATERAL AGENT"). All
capitalized terms used but not otherwise defined herein shall have the
respective meanings ascribed thereto in the Intercreditor Agreement.

                             PRELIMINARY STATEMENTS

                  A.       As of the date hereof, Pledgor is the legal and
beneficial owner of the shares of Capital Stock issued by Covanta Energy
Corporation, a Delaware corporation ("COMPANY") listed on Schedule I hereto.

                  B.       Pursuant to the Credit Agreement dated as of March
__, 2004 (said Credit Agreement or any credit agreement entered into by Detroit
L/C Borrowers (as defined below) to refinance, replace, renew or extend, in
whole or in part, said Credit Agreement and the indebtedness and letters of
credit issued thereunder to the extent permitted pursuant to the New L/C
Facility Agreement (as defined below) and the High Yield Indenture (as defined
below), as said Credit Agreement or any replacement to said Credit Agreement may
be amended, restated, supplemented or otherwise modified from time to time,
being the "DETROIT L/C FACILITY AGREEMENT"), by and among Company as a borrower
the Subsidiaries of Company party thereto from time to time as additional
borrowers (collectively, Company and such Subsidiaries being the "DETROIT L/C
BORROWERS" and each a "DETROIT L/C BORROWER"), the financial institutions from
time to time party thereto as lenders (the "DETROIT L/C LENDERS"), Bank of
America, N.A., as administrative agent (the "DETROIT L/C FACILITY AGENT"), and
Deutsche Bank Securities, Inc., as documentation agent for the Detroit L/C
Lenders (in such capacity "DETROIT L/C DOCUMENTATION AGENT," and together with
the Detroit L/C Facility Agent, the "DETROIT L/C AGENTS"), the Detroit L/C
Lenders have made certain commitments (each, a "DETROIT L/C COMMITMENT"),
subject to the terms and conditions set forth in the Detroit L/C Facility
Agreement, to extend certain letter of credit facilities to Detroit L/C
Borrowers.

                  C.       Pursuant to the Credit Agreement dated as of March
__, 2004 (said Credit Agreement or any credit agreement entered into by New L/C
Borrowers (as defined below) to refinance, replace, renew or extend, in whole or
in part, said Credit Agreement 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, as said Credit Agreement or

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any replacement to said Credit Agreement may be amended, restated,  supplemented
or otherwise modified from time to time, being the "NEW L/C FACILITY AGREEMENT,"
and  collectively  with  the  Detroit  L/C  Facility   Agreement,   the  "CREDIT
AGREEMENTS"),  by and among Company as a borrower,  the  Subsidiaries of Company
party thereto from time to time as additional borrowers  (collectively,  Company
and  such  Subsidiaries  being  the  "NEW  L/C  BORROWERS"  and  each a "NEW L/C
BORROWER," and collectively  with the Detroit L/C Borrowers,  the  "BORROWERS"),
the financial institutions listed therein as lenders (the "NEW L/C LENDERS") and
Bank  One,  N.A.,  as  administrative  agent  for the New L/C  Lenders  (in such
capacity, the "NEW L/C AGENT," and collectively with the Detroit L/C Agents, the
Detroit L/C Lenders, the High Yield Trustee, the High Yield Noteholders, the New
L/C Lenders and the Cash Management Bank, the "BENEFITED PARTIES"),  the New L/C
Lenders  have  made  certain  commitments  (each,  a "NEW L/C  COMMITMENT,"  and
together with the Detroit L/C  Commitments,  collectively,  the  "COMMITMENTS"),
subject to the terms and conditions set forth in the New L/C Facility Agreement,
to extend  certain letter of credit and revolving  credit  facilities to the New
L/C Borrowers.

                  D.       Pursuant to the indenture dated as of March __, 2004
(said indenture or any replacement to said indenture entered into in connection
with a refinancing, defeasance, renewal, replacement or extension of the High
Yield Notes (as defined below) permitted under the Detroit L/C Facility
Agreement and New L/C Facility Agreement (as defined below), as said indenture
or replacement to said indenture may be amended, supplemented or otherwise
modified from time to time, being the "HIGH YIELD INDENTURE") by and between
Company and U.S. Bank, in its capacity as trustee (the "HIGH YIELD TRUSTEE"),
Company has issued $205,000,000 in aggregate initial face principal amount
(accruing to $230,000,000 at stated maturity) of its 8.25% Senior Notes due 2011
(the "HIGH YIELD NOTES").

                  E.       Borrowers other than the Company (the "HIGH YIELD
GUARANTORS," and together with the Company and the Borrowers, each individually
a "LOAN PARTY," and collectively the "LOAN PARTIES") have agreed, in favor of
the holders of the High Yield Notes (the "HIGH YIELD NOTEHOLDERS"), to guarantee
the prompt payment and performance when due of all obligations of Company under
the High Yield Notes on the terms and conditions set forth in the High Yield
Indenture.

                  F.       In accordance with the terms of the Credit
Agreements, Borrowers are required to maintain the Cash Management System with
Bank of America (in such capacity, the "CASH MANAGEMENT BANK"), and it is
desired that the Cash Management Obligations be secured hereunder.

                  G.       The Detroit L/C Borrowers, the New L/C Borrowers,
Pledgor, the Detroit L/C Agents, the Detroit L/C Lenders, the High Yield Trustee
for the benefit of the High Yield Noteholders, the New L/C Agent, the New L/C
Lenders, the Cash Management Bank and Collateral Agent have entered into that
certain Intercreditor Agreement dated as of March __, 2004 (as it may hereafter
be amended, restated, supplemented or otherwise modified from time to time, the
"INTERCREDITOR AGREEMENT"), pursuant to which the Detroit L/C Agents, the
Detroit L/C Lenders, the High Yield Trustee for the benefit of the High Yield
Noteholders, the New L/C Agent, the New L/C Lenders and the Cash Management Bank
have appointed Collateral Agent, and Collateral Agent has agreed to act, as
collateral agent

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for the Detroit L/C Agents, the Detroit L/C Lenders, the High Yield Noteholders,
the New L/C Agent, the New L/C Lenders and the Cash Management Bank hereunder.

                  H.       It is a condition precedent to (i) the extension of
credit by the Detroit L/C Lenders under the Detroit L/C Facility Agreement, (ii)
the effectiveness of the High Yield Indenture and (iii) the extension of credit
by the New L/C Lenders under the New L/C Facility Agreement that the Pledgor
shall have granted the security interest and undertaken the obligations
contemplated by this Agreement.

                  NOW, THEREFORE, in consideration of the premises and in order
to induce the Detroit L/C Lenders to make extensions of credit from time to time
under the Detroit L/C Facility Agreement, the New L/C Lenders to make extensions
of credit from time to time under the New L/C Facility Agreement, the High Yield
Noteholders to accept the High Yield Notes issued under the High Yield
Indenture, for the Cash Management Bank to provide cash management services to
the Borrowers and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Pledgor hereby agrees with Collateral
Agent as follows:

                  SECTION 1. PLEDGE OF SECURITY. Pledgor hereby pledges and
collaterally assigns to Collateral Agent, and hereby grants to Collateral Agent
a security interest in, all of Pledgor's right, title and interest in and to the
following (the "PLEDGED COLLATERAL"):

                  (a)      all Capital Stock in Company now or hereafter owned
by Pledgor, whether such Capital Stock is classified as investment property or
general intangibles under the Uniform Commercial Code as in effect in the State
of New York ("UCC"), including all securities convertible into, and rights,
warrants, options and other rights to purchase or otherwise acquire, any Capital
Stock in Company, and including those owned on the date hereof and described in
Schedule I for Pledgor, the certificates or other instruments representing any
of the foregoing and any interest of Pledgor in the entries on the books of any
securities intermediary pertaining thereto (the "PLEDGED EQUITY"), and all
distributions, dividends, and other property received, receivable or otherwise
distributed in respect of or in exchange therefor; and

                  (b)      to the extent not covered by clause (a) above, all
proceeds of any or all of the foregoing Pledged Collateral. For purposes of this
Agreement, the term "PROCEEDS" includes whatever is receivable or received when
Pledged Collateral or proceeds are sold, exchanged, collected or otherwise
disposed of, whether such disposition is voluntary or involuntary.

                  The security interest granted hereby is subject to the terms
of the Intercreditor Agreement (including, without limitation, the provisions
regarding lien priority).

                  SECTION 2. SECURITY FOR OBLIGATIONS. This Agreement secures,
and the Pledged Collateral assigned by Pledgor is collateral security for, the
Secured Obligations.

                  SECTION 3. DELIVERY OF PLEDGED COLLATERAL. All certificates or
instruments representing or evidencing the Pledged Collateral shall be delivered
to and held by or on behalf of Collateral Agent pursuant hereto and shall be in
suitable form for transfer by

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delivery or, as applicable, shall be accompanied by Pledgor's endorsement, where
necessary, or duly executed instruments of transfer or assignment in blank, all
in form and substance satisfactory to Collateral Agent. Upon the occurrence and
during the continuation of an Event of Default, Collateral Agent shall have the
right, with notice to Pledgor, to transfer to or to register in the name of
Collateral Agent or any of its nominees any or all of the Pledged Collateral,
subject to the revocable rights specified in Section 7(a). In addition, upon the
occurrence and during the continuation of an Event of Default, Collateral Agent
shall have the right at any time to exchange certificates or instruments
representing or evidencing Pledged Equity for certificates or instruments of
smaller or larger denominations.

                  SECTION 4. REPRESENTATIONS AND WARRANTIES. Pledgor represents
and warrants as follows:

                  (a)      Organization and Powers. Pledgor is duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite power and authority to own and operate its properties, to
carry on its business as now conducted and proposed to be conducted and to enter
into this Agreement and carry out the transactions contemplated hereby.

                  (b)      Good Standing. Pledgor is qualified to do business
and in good standing wherever necessary to carry on its present business and
operations, except in jurisdictions in which the failure to be so qualified or
in good standing will not have a material adverse effect on the business,
operations, properties, assets or condition (financial or otherwise) of Pledgor.

                  (c)      Authorization. The execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action by Pledgor.

                  (d)      No Conflict. The execution, delivery and performance
by Pledgor of this Agreement will not (i) violate the Certificate of
Incorporation or Bylaws of Pledgor, (ii) violate any provision of law applicable
to Pledgor, or any order, judgment or decree of any court or other agency of
government binding on Pledgor, (iii) be in conflict with, result in a breach of,
or constitute (with due notice or lapse of time or both) a default under any
material Contractual Obligation of Pledgor, (iv) result in or require the
creation or imposition of any Lien upon any of its properties or assets other
than the Lien created by this Agreement, or (v) require the approval of
stockholders or any approval or consent of any Person under any material
Contractual Obligation of Pledgor, except to the extent any such consent has
been obtained on or prior to the date hereof.

                  (e)      Binding Obligation. This Agreement is the legally
valid and binding obligation of Pledgor, enforceable against it in accordance
with its terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws or equitable principles relating to
or limiting creditors' rights generally.

                  (f)      Due Authorization, etc. of Pledged Equity. All of the
Pledged Equity described on Schedule I has been duly authorized and validly
issued and is fully paid and non-assessable.

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                  (g)      Description of Pledged Equity. As of the date hereof,
the Pledged Equity constitutes all of the issued and outstanding Capital Stock
in Company and there are no outstanding warrants, options or other rights to
purchase, or other agreements outstanding with respect to, or property that is
now or hereafter convertible into, or that requires the issuance or sale of, any
Capital Stock of Company.

                  (h)      Ownership of Pledged Collateral. Pledgor is the
legal, record and beneficial owner of the Pledged Collateral and its interests
in the Pledged Collateral are free and clear of any Lien.

                  (i)      Governmental Authorizations. No authorization,
approval or other action by, and no notice to or filing with, any Government
Authority or regulatory body is required for either (i) the pledge by Pledgor of
the Pledged Collateral pursuant to this Agreement and the grant by Pledgor of
the security interests granted hereby, (ii) the execution, delivery or
performance of this Agreement by Pledgor, or (iii) the exercise by Collateral
Agent of the voting or other rights, or the remedies in respect of the Pledged
Collateral, provided for in this Agreement (except (x) as may be required in
connection with a disposition of Pledged Collateral by laws affecting the
offering and sale of securities generally and (y) approval by the Federal Agency
Regulatory Commission under Section 203 of the Federal Power Act).

                  (j)      Perfection. The security interest in the Pledged
Collateral granted to Collateral Agent in Section 2 hereof constitutes a valid
security interest, to the extent the UCC is applicable thereto, securing the
payment of the applicable Secured Obligations. Upon (i) the filing of UCC
financing statements naming Pledgor as "debtor", naming Collateral Agent as
"secured party" and describing the Pledged Collateral in the filing offices
listed on Schedule II and (ii) in the case of Pledged Collateral consisting of
certificated securities, in addition to filing such financing statements,
delivery of the certificates representing such certificated securities to
Collateral Agent, duly endorsed or accompanied by duly executed instruments of
assignment or transfer in blank, the security interest in the Pledged Collateral
referred to in the immediately preceding sentence will constitute a perfected
security interest therein, to the extent the UCC is applicable thereto, prior to
all other Liens, securing the payment of the Secured Obligations, and all
filings and other actions in the United States necessary to perfect and protect
such security interest have been duly made or taken.

                  (k)      Office Location; Type and Jurisdiction of
Organization. The chief executive office of Pledgor is, as of the date hereof,
located at 2 North Riverside Plaza, Suite 600, Chicago, Illinois 60606; as of
the date hereof, Pledgor's name as it appears in official filings in its
jurisdiction of incorporation is "Danielson Holding Corporation."

                  (l)      Names. Pledgor (or predecessor by merger or otherwise
of Pledgor) has not, within the five year period preceding the date hereof, had
a different name from the name of Pledgor listed on the signature pages hereof,
except the names set forth on Schedule III annexed hereto.

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                  (m)      Margin Regulations. The pledge of the Pledged
Collateral pursuant to this Agreement does not violate Regulations T, U or X of
the Board of Governors of the Federal Reserve System.

                  SECTION 5. COVENANTS. Pledgor shall:

                  (a)      not (i) sell, assign (by operation of law or
otherwise) or otherwise dispose of, or grant any option with respect to, any of
the Pledged Collateral if such action would cause an Event of Default to occur,
or (ii) create or suffer to exist any Lien upon or with respect to any of the
Pledged Collateral;

                  (b)      (i) cause Company not to, issue any Capital Stock in
addition to or in substitution for the Pledged Equity issued by Company, except
to Pledgor, if such action would cause an Event of Default to occur and (ii)
pledge hereunder, immediately upon its acquisition (directly or indirectly)
thereof, any and all additional Capital Stock of Company issued to, or acquired
by, the Pledgor;

                  (c)      at its expense (i) perform and comply in all material
respects with all terms and provisions of any agreement related to the Pledged
Collateral required to be performed or complied with by it, (ii) maintain all
such agreements in full force and effect (except where the failure to maintain
such agreements will not materially adversely effect the Pledged Collateral),
and (iii) enforce all such agreements in accordance with their terms (except
where the failure to enforce such agreements will not materially adversely
effect the Pledged Collateral);

                  (d)      give Collateral Agent at least 30 days' prior written
notice of any (i) change in Pledgor's name, identity or corporate structure and
(ii) reincorporation, reorganization or other action that results in a change of
the jurisdiction or organization of Pledgor; and

                  (e)      if any Pledged Collateral is not a security pursuant
to Section 8-103 of the UCC, not take any action that, under such Section,
converts such Pledged Collateral into a security without causing the issuer
thereof to issue to it certificates or instruments evidencing such Pledged
Collateral, which it shall promptly deliver to Collateral Agent as provided in
this Section 5.

                  SECTION 6. FURTHER ASSURANCES; PLEDGE AMENDMENTS.

                  (a)      Pledgor agrees that from time to time, at the expense
of Pledgor, Pledgor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary, or that
Collateral Agent may reasonably request, in order to perfect and protect the
security interest granted or purported to be granted hereby or to enable
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to any Pledged Collateral. Without limiting the generality of the
foregoing, Pledgor will: (i) execute (if necessary) and file such financing or
continuation statements, or amendments thereto, and such other instruments or
notices, as may be necessary, or as Collateral Agent may reasonably request, in
order to perfect and preserve the security interest granted or purported to be
granted hereby and (ii) at Collateral Agent's reasonable request,

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appear in and defend any action or proceeding that may affect Pledgor's title to
or Collateral Agent's security interests in all or any material part of the
Pledged Collateral. Pledgor hereby authorizes Collateral Agent to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Pledged Collateral, as may be appropriate, including
without limitation, the financing statement to be filed with the Secretary of
State of the State of Delaware and any other filing offices listed on Schedule
II.

                  (b)      Pledgor further agrees that it will, upon obtaining
any additional Capital Stock in Company, promptly (and in any event within five
Business Days) deliver to Collateral Agent a Pledge Amendment, duly executed by
Pledgor, in substantially the form of Schedule IV annexed hereto (a "PLEDGE
AMENDMENT") together with supplements to the Schedules annexed hereto, as
applicable, to cause such Schedules to be complete and accurate at such time, in
respect of the additional Pledged Equity to be pledged pursuant to this
Agreement; provided that the failure of Pledgor to execute a Pledge Amendment
with respect to any additional Pledged Equity shall not impair the security
interest of Collateral Agent therein or otherwise adversely affect the rights
and remedies of Collateral Agent hereunder with respect thereto. Upon each such
acquisition, the representations and warranties contained in Section 4 hereof
shall be deemed to have been made by Pledgor as to the Pledged Collateral
described in such Pledge Amendment.

                  SECTION 7. VOTING RIGHTS; DIVIDENDS; ETC.

                  (a)      So long as no Event of Default shall have occurred
and be continuing:

         (i)      Pledgor shall be entitled to exercise any and all voting and
         other consensual rights pertaining to the Pledged Collateral or any
         part thereof for any purpose not in violation of the terms of this
         Agreement or the Credit Documents; and

         (ii)     Pledgor shall be entitled to receive and retain, and to
         utilize free and clear of the lien of this Agreement, any and all
         dividends, other distributions and interest paid in respect of the
         Pledged Collateral; provided, however, that any and all

                           (A)      dividends and other distributions paid or
                  payable other than in cash in respect of, and instruments and
                  other property received, receivable or otherwise distributed
                  in respect of, or in exchange for, any Pledged Collateral,

                           (B)      dividends and other distributions paid or
                  payable in cash in respect of any Pledged Collateral in
                  connection with a partial or total liquidation or dissolution
                  or in connection with a reduction of capital, capital surplus
                  or paid-in-surplus, and

                           (C)      cash paid, payable or otherwise distributed
                  in redemption of or in exchange for any Pledged Collateral,

         in each case shall be, and shall forthwith be delivered to Collateral
         Agent to hold as, Pledged Collateral and shall, if received by Pledgor,
         be received in trust for the benefit of Collateral Agent, be segregated
         from the other property or funds of Pledgor

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         and be forthwith delivered to Collateral Agent as Pledged Collateral in
         the same form as so received (with all necessary endorsements).

                  Notwithstanding the foregoing, the parties hereto acknowledge
that the Credit Agreements contain restrictions on the payment of dividends and
distributions on the Pledged Collateral, none of which restrictions are waived
or otherwise prejudiced hereby.

                  (b)      Upon the occurrence and during the continuation of an
Event of Default:

         (i)      upon written notice from Collateral Agent to Pledgor, all
         rights of Pledgor to exercise the voting and other consensual rights
         that it would otherwise be entitled to exercise pursuant to Section
         7(a)(i) shall cease, and all such rights shall thereupon become vested
         in Collateral Agent who shall thereupon have the sole right to exercise
         such voting and other consensual rights until such time as Collateral
         Agent shall notify Pledgor that Pledgor may exercise such rights again
         pursuant to Section 7(a)(i);

         (ii)     except as otherwise provided in the Credit Documents, upon
         written notice from Collateral Agent to Pledgor all rights of Pledgor
         to receive the dividends and other distributions that it would
         otherwise be authorized to receive and retain pursuant to Section
         7(a)(ii) shall cease, and all such rights shall thereupon become vested
         in Collateral Agent who shall thereupon have the sole right to receive
         and hold as Pledged Collateral such dividends and other distributions
         until such time as Collateral Agent shall notify Pledgor that Pledgor
         may exercise such rights again pursuant to Section 7(a)(ii); and

         (iii)    all dividends and other distributions that are received by
         Pledgor contrary to the provisions of paragraph (ii) of this Section
         7(b) shall be received in trust for the benefit of Collateral Agent,
         shall be segregated from other funds of Pledgor and shall forthwith be
         paid over to Collateral Agent as Pledged Collateral in the same form as
         so received (with any necessary endorsements).

                  (c)      IRREVOCABLE PROXY. In order to permit Collateral
Agent to exercise the voting and other consensual rights that it may be entitled
to exercise pursuant to Section 7(b)(i) and to receive all dividends and other
distributions which it may be entitled to receive under Section 7(a)(ii) or
Section 7(b)(ii), (i) Pledgor shall promptly execute and deliver (or cause to be
executed and delivered) to Collateral Agent all such proxies, dividend payment
orders and other instruments as Collateral Agent may from time to time
reasonably request and (ii) without limiting the effect of the immediately
preceding clause (i), Pledgor hereby grants to Collateral Agent an IRREVOCABLE
PROXY to vote the Pledged Equity and to exercise all other rights, powers,
privileges and remedies to which a holder of the Pledged Equity would be
entitled (including, without limitation, giving or withholding written consents
of holders of the Pledge Equity, calling special meetings of holders of the
Pledged Equity and voting at such meetings), which proxy shall be effective,
automatically and without the necessity of any action (including any transfer of
any Pledged Equity on the record books of the issuer thereof) by any other
Person (including the issuer of the Pledged Equity or any officer or agent
thereof), only upon the occurrence and during the continuance

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of an Event of Default, only to the extent Collateral Agent is entitled to
exercise such rights hereunder and which proxy shall only terminate upon the
payment in full of all Secured Obligations (other than contingent
indemnification Secured Obligations with respect to claims which have not yet
arisen).

                  SECTION 8. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.
Pledgor hereby irrevocably appoints Collateral Agent as Pledgor's
attorney-in-fact, with full authority in the place and stead of Pledgor and in
the name of Pledgor, Collateral Agent or otherwise, from time to time in
Collateral Agent's discretion to take any action, subject to the Intercreditor
Agreement, and to execute any instrument that Collateral Agent may deem
necessary or advisable to accomplish the purposes of this Agreement, including
without limitation:

                  (a)      upon the occurrence and during the continuance of an
Event of Default, to ask, demand, collect, sue for, recover, compound, receive
and give acquittance and receipts for moneys due and to become due under or in
respect of any of the Pledged Collateral;

                  (b)      upon the occurrence and during the continuance of an
Event of Default, to receive, endorse and collect any instruments made payable
to Pledgor representing any dividend or other distribution in respect of the
Pledged Collateral or any part thereof and to give full discharge for the same;

                  (c)      upon the occurrence and during the continuance of an
Event of Default, to file any claims or take any action or institute any
proceedings that Collateral Agent may deem necessary or desirable for the
collection of any of the Pledged Collateral or otherwise to enforce the rights
of Collateral Agent with respect to any of the Pledged Collateral;

                  (d)      with notice to the Pledgor, to pay or discharge taxes
or Liens levied or placed upon or threatened against the Pledged Collateral, the
legality or validity thereof and the amounts necessary to discharge the same to
be determined by Collateral Agent in its sole discretion, any such payments made
by Collateral Agent to become Secured Obligations; and

                  (e)      upon the occurrence and during the continuance of an
Event of Default, generally to sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Pledged Collateral as fully and
completely as though Collateral Agent were the absolute owner thereof for all
purposes, and to do, at Collateral Agent's option and Pledgor's expense, at any
time or from time to time, all acts and things that Collateral Agent deems
necessary to protect, preserve or realize upon the Pledged Collateral and
Collateral Agent's security interest therein in order to effect the intent of
this Agreement, all as fully and effectively as Pledgor might do.

                  SECTION 9. COLLATERAL AGENT MAY PERFORM; NO ASSUMPTION.

                  (a)      If Pledgor fails to perform any agreement contained
herein, Collateral Agent may itself perform, or cause performance of, such
agreement, and the expenses of

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Collateral Agent incurred in connection therewith shall be payable by Pledgor
pursuant to Section 13(b).

                  (b)      Anything contained herein to the contrary
notwithstanding, (i) Pledgor shall remain liable under any agreements included
in or related to the Pledged Collateral, to the extent set forth therein, to
perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (ii) the exercise by Collateral Agent of
any of its rights hereunder shall not release Pledgor from any of its duties or
obligations under any such agreements, and (iii) Collateral Agent shall not have
any obligation or liability under any such agreements by reason of this
Agreement, nor shall Collateral Agent be obligated to perform any of the
obligations or duties of Pledgor thereunder or to take any action to collect or
enforce any claim for payment assigned hereunder.

                  SECTION 10. STANDARD OF CARE. The powers conferred on
Collateral Agent hereunder are solely to protect its interest in the Pledged
Collateral and shall not impose any duty upon it to exercise any such powers.
Except for the exercise of reasonable care in the custody of any Pledged
Collateral in its possession and the accounting for moneys actually received by
it hereunder, Collateral Agent shall have no duty as to any Pledged Collateral,
it being understood that Collateral Agent shall have no responsibility for (a)
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relating to any Pledged Collateral, whether
or not Collateral Agent has or is deemed to have knowledge of such matters, (b)
taking any necessary steps (other than steps taken in accordance with the
standard of care set forth above to maintain possession of the Pledged
Collateral) to preserve rights against any prior parties or any other rights
pertaining to any Pledged Collateral, (c) taking any necessary steps to collect
or realize upon the Secured Obligations or any guarantee therefor, or any part
thereof, or any of the Pledged Collateral, or (d) initiating any action to
protect the Pledged Collateral against the possibility of a decline in market
value. Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of Pledged Collateral in its possession if such Pledged
Collateral is accorded treatment substantially equal to that which Collateral
Agent accords its own property consisting of Capital Stock.

                  SECTION 11. REMEDIES.

                  (a)      Subject to the terms of the Intercreditor Agreement,
if any Event of Default shall have occurred and be continuing, Collateral Agent
may exercise in respect of the Pledged Collateral, in addition to all other
rights and remedies provided for herein or otherwise available to it, all the
rights and remedies of a secured party on default under the UCC (whether or not
the UCC applies to the affected Pledged Collateral), and Collateral Agent may
also in its sole discretion, without notice except as specified below, sell the
Pledged Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange or broker's board or at any of Collateral Agent's
offices or elsewhere, for cash, on credit or for future delivery, at such time
or times and at such price or prices and upon such other terms as Collateral
Agent may deem commercially reasonable, irrespective of the impact of any such
sales on the market price of the Pledged Collateral. Collateral Agent or any
Benefited Party (subject to the terms of the Intercreditor Agreement) may be the
purchaser of any or all of the Pledged Collateral at any such sale, and
Collateral Agent, as

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                                     XI-10
<PAGE>

agent for and representative of Lenders (but not any Benefited Party in its
individual capacity unless Requisite Obligees shall otherwise agree in writing),
shall be entitled, for the purpose of bidding and making settlement or payment
of the purchase price for all or any portion of the Pledged Collateral sold at
any such public sale, to use and apply any of the Secured Obligations as a
credit on account of the purchase price for any Pledged Collateral payable by
Collateral Agent at such sale. Each purchaser at any such sale shall hold the
property sold absolutely free from any claim or right on the part of Pledgor,
and Pledgor hereby waives (to the extent permitted by applicable law) all rights
of redemption, stay and/or appraisal which it now has or may at any time in the
future have under any rule of law or statute now existing or hereafter enacted.
Pledgor agrees that, to the extent notice of sale shall be required by law, at
least ten days' notice to Pledgor of the time and place of any public sale or
the time after which any private sale is to be made shall constitute reasonable
notification. Collateral Agent shall not be obligated to make any sale of
Pledged Collateral regardless of notice of sale having been given. Collateral
Agent may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned. Pledgor hereby
waives (to the extent permitted by applicable law) any claims against Collateral
Agent arising by reason of the fact that the price at which any Pledged
Collateral may have been sold at such a private sale was less than the price
which might have been obtained at a public sale, even if Collateral Agent
accepts the first offer received and does not offer such Pledged Collateral to
more than one offeree.

                  (b)      Pledgor recognizes that, by reason of certain
prohibitions contained in the Securities Act of 1933, as from time to time
amended (the "SECURITIES ACT"), and applicable state securities laws, Collateral
Agent may be compelled, with respect to any sale of all or any part of the
Pledged Collateral conducted without prior registration or qualification of such
Pledged Collateral under the Securities Act and/or such state securities laws,
to limit purchasers to those who will agree, among other things, to acquire the
Pledged Collateral for their own account, for investment and not with a view to
the distribution or resale thereof. Pledgor acknowledges that any such private
placement may be at prices and on terms less favorable than those obtainable
through a sale without such restrictions (including, without limitation, an
offering made pursuant to a registration statement under the Securities Act)
and, notwithstanding such circumstances, Pledgor agrees that any such private
placement shall not be deemed, in and of itself, to be commercially unreasonable
and that Collateral Agent shall have no obligation to delay the sale of any
Pledged Collateral for the period of time necessary to permit the issuer thereof
to register it for a form of sale requiring registration under the Securities
Act or under applicable state securities laws, even if such issuer would, or
should, agree to so register it.

                  (c)      If Collateral Agent determines to exercise its right
to sell any or all of the Pledged Collateral, upon written request, Pledgor
shall use commercially reasonable efforts to, and shall cause each issuer of any
Pledged Equity to be sold hereunder from time to time to furnish to Collateral
Agent all such information as Collateral Agent may request in order to,
determine the amount of Pledged Collateral that may be sold by Collateral Agent
in exempt transactions under the Securities Act and the rules and regulations of
the Securities and Exchange Commission thereunder, as the same are from time to
time in effect.

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                                     XI-11
<PAGE>

                  (d)      Pledgor agrees that a breach of any of the covenants
contained in Section 11 will cause irreparable injury to Collateral Agent, that
Collateral Agent has no adequate remedy at law in respect of such breach and, as
a consequence, that each and every covenant contained in Section 11 shall be
specifically enforceable against Pledgor, and Pledgor hereby waives and agrees
(to the extent permitted by applicable law) not to assert any defenses against
an action for specific performance of such covenants except for a defense that
no default has occurred giving rise to the Secured Obligations becoming due and
payable prior to their stated maturities.

                  SECTION 12. APPLICATION OF PROCEEDS. Except as expressly
provided elsewhere in this Agreement, all proceeds received by Collateral Agent
in respect of any sale of, collection from, or other realization upon all or any
part of the Pledged Collateral (whether pursuant to the preceding sentence or
otherwise) shall be applied in accordance with the Intercreditor Agreement.

                  SECTION 13. INDEMNITY AND EXPENSES.

                  (a)      Pledgor agrees to indemnify Collateral Agent and each
Benefited Party from and against any and all claims, losses and liabilities in
any way relating to, growing out of or resulting from this Agreement and the
transactions contemplated hereby (including, without limitation, enforcement of
this Agreement), except to the extent such claims, losses or liabilities result
solely from Collateral Agent's or such Benefited Party's gross negligence or
willful misconduct as finally determined by a court of competent jurisdiction.

                  (b)      Pledgor agrees to pay to Collateral Agent the amount
of any and all costs and expenses, including the reasonable fees and expenses of
its counsel and of any experts and agents, that Collateral Agent may incur in
connection with (i) the administration of this Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Pledged Collateral, (iii) the exercise or enforcement of any of the
rights of Collateral Agent hereunder, or (iv) the failure by Pledgor to perform
or observe any of the provisions hereof.

                  (c)      Anything contained in this Agreement to the contrary
notwithstanding, the obligations of Pledgor set forth in this Section 13 are
included herein solely for the purpose of including such obligations within the
Secured Obligations, and such obligations shall in all respects be limited by
the provisions of Section 27; accordingly, nothing in this Section 13 shall be
construed in a manner which shall obligate Pledgor to make any payment, or
provide any security, to Collateral Agent with respect to such obligations apart
from the grant of the security interest in the Pledged Collateral as set forth
in Section 1 hereof.

                  SECTION 14. CONTINUING SECURITY INTERESTS; TRANSFER OF LOANS.

                  (a)      This Agreement shall create a continuing security
interest in the Pledged Collateral and shall (i) remain in full force and effect
until the payment in full of all Secured Obligations (other than contingent
indemnification Secured Obligations with respect to claims which have not yet
arisen), and the cancellation or termination of all commitments to extend credit
under the Credit Documents (collectively, the "COMMITMENTS"), (ii) be

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                                     XI-12
<PAGE>

binding upon Pledgor, its successors and assigns, and (iii) inure, together with
the rights and remedies of Collateral Agent hereunder, to the benefit of
Collateral Agent and its successors, transferees and assigns. Without limiting
the generality of the foregoing clause (iii), but subject to the relevant
assignment provisions set forth in each of the Credit Documents and the
Intercreditor Agreement, (A) any Detroit L/C Agent or any Detroit L/C Lender may
assign or otherwise transfer its rights under the Detroit L/C Facility Agreement
to any other Person, and in each case such other Person shall thereupon become
vested with all the benefits in respect thereof granted to such Detroit L/C
Agent or such Detroit L/C Lender, as applicable, herein or otherwise (subject to
the terms of the Intercreditor Agreement) (B) the New L/C Agent and any New L/C
Lender may assign or otherwise transfer its rights under the New L/C Facility
Agreement to any other Person, and in each case such other Person shall
thereupon become vested with all the benefits in respect thereof granted to the
New L/C Agent or such New L/C Lender, as applicable, herein or otherwise
(subject to the terms of the Intercreditor Agreement) and (C) any High Yield
Noteholder may assign or otherwise transfer any High Yield Note to any other
Person in accordance with the High Yield Indenture, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted to High
Yield Noteholders herein or otherwise (subject to the terms of the Intercreditor
Agreement).

                  (b)      Upon the payment in full of all Secured Obligations
(other than contingent indemnification Secured Obligations with respect to
claims which have not yet arisen), and the cancellation or termination of the
Commitments, the security interest granted hereby shall terminate and all rights
to the Pledged Collateral shall revert to Pledgor. Upon any such termination
Collateral Agent will, at Pledgor's expense, execute and deliver to Pledgor such
documents as Pledgor shall reasonably request to evidence such termination. In
addition, upon the proposed sale, transfer or other disposition of any Pledged
Collateral by Pledgor (to the extent any such sale, transfer or other
disposition would not constitute an Event of Default) for which Pledgor desires
to obtain a security interest release from Collateral Agent, Pledgor shall
deliver an Officer's Certificate (x) stating that the sale, transfer or other
disposition of such Pledged Collateral would not constitute an Event of Default
and (y) specifying the Pledged Collateral being sold, transferred or otherwise
disposed of in the proposed transaction. Upon the receipt of such Officer's
Certificate and so long as no Event of Default would result from the proposed
sale, transfer or other disposition of the Pledged Collateral, Collateral Agent
shall, at Pledgor's expense, so long as Collateral Agent believes in good faith,
that the Officer's Certificate delivered by Pledgor with respect to such sale is
true, correct and complete, execute and deliver such releases of its security
interest in such Pledged Collateral which is to be so sold, transferred or
disposed of, as may be reasonably requested by Pledgor.

                  SECTION 15. COLLATERAL AGENT AS AGENT.

                  (a)      Pursuant to the Intercreditor Agreement, Collateral
Agent has been appointed to act as Collateral Agent hereunder by the Detroit L/C
Agents, the Detroit L/C Lenders, the High Yield Trustee for the benefit of the
High Yield Noteholders, the New L/C Agent, the New L/C Lenders and the Cash
Management Bank. Collateral Agent shall be obligated, and shall have the right
hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including

DHC Stock Pledge Agreement

                                     XI-13
<PAGE>

without limitation the release or substitution of Pledged Collateral), solely in
accordance with this Agreement, the Intercreditor Agreement and the other Credit
Documents; provided that Collateral Agent shall exercise, or refrain from
exercising, any remedies provided for in Section 11 in accordance with the
instructions of Requisite Obligees.

                  (b)      Collateral Agent shall at all times be the same
Person that is Collateral Agent under the Intercreditor Agreement. Written
notice of resignation by Collateral Agent pursuant to subsections 6.1(h) or (i)
of the Intercreditor Agreement shall also constitute notice of resignation as
Collateral Agent under this Agreement; removal of Collateral Agent pursuant to
subsections 6.1(h) or (i) of the Intercreditor Agreement shall also constitute
removal as Collateral Agent under this Agreement; and appointment of a successor
Collateral Agent pursuant to subsections 6.1(h) or (i) of the Intercreditor
Agreement shall also constitute appointment of a successor Collateral Agent
under this Agreement. Upon the acceptance of any appointment as Collateral Agent
under subsections 6.1(h) or (i) of the Intercreditor Agreement by a successor
Collateral Agent, that successor Collateral Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
or removed Collateral Agent under this Agreement, and the retiring or removed
Collateral Agent under this Agreement shall promptly (i) transfer to such
successor Collateral Agent all sums, securities and other items of Collateral
held hereunder, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Collateral Agent under this Agreement, and (ii) execute and deliver to such
successor Collateral Agent such amendments to financing statements, and take
such other actions, as may be necessary or appropriate in connection with the
assignment to such successor Collateral Agent of the security interest created
hereunder, whereupon such retiring or removed Collateral Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Collateral Agent's resignation or removal hereunder as
Collateral Agent, the provisions of this Agreement shall inure to its benefit as
to any actions taken or omitted to be taken by it under this Agreement while it
was Collateral Agent hereunder.

                  SECTION 16. [INTENTIONALLY OMITTED]

                  SECTION 17. AMENDMENTS; ETC. No amendment, modification,
termination or waiver of any provision of this Agreement, and no consent to any
departure by Pledgor therefrom, shall in any event be effective unless the same
shall be in writing and signed by Collateral Agent and, in the case of any such
amendment or modification, by Pledgor. Any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given.

                  SECTION 18. NOTICES. Unless otherwise specifically provided
herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, or sent by telefacsimile
or United States mail or courier service or electronic mail and shall be deemed
to have been given (a) when delivered in person or by courier service, (b) upon
receipt of telefacsimile in complete and legible form, or (c) three Business
Days after depositing it in the United States mail with postage prepaid and
properly addressed; provided that notices to Collateral Agent shall not be
effective until received. For the purposes hereof, the address of each party
hereto shall be as set forth under

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                                     XI-14
<PAGE>

such party's name on the signature pages hereof or such other address as shall
be designated by such Person in a written notice delivered to such other party
hereto.

                  SECTION 19. FAILURE OR INDULGENCE NOT WAIVER; REMEDIES
CUMULATIVE. No failure or delay on the part of Collateral Agent in the exercise
of any power, right or privilege hereunder shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude any other or further exercise thereof or of any other power, right or
privilege. All rights and remedies existing under this Agreement are cumulative
to, and not exclusive of, any rights or remedies otherwise available.

                  SECTION 20. SEVERABILITY. In case any provision in or
obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

                  SECTION 21. HEADINGS. Section and subsection headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose or be given any
substantive effect.

                  SECTION 22. GOVERNING LAW; TERMS. THIS AGREEMENT AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
(INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THAT
WOULD REQUIRE APPLICATION OF ANOTHER LAW, EXCEPT TO THE EXTENT THAT THE UCC
PROVIDES THAT THE PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR PLEDGED COLLATERAL ARE GOVERNED BY THE
LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. Unless otherwise
defined herein or in the Credit Documents, terms used in Articles 8 and 9 of the
UCC are used herein as therein defined. The rules of construction set forth in
subsection 1.3 of each Credit Agreement shall be applicable to this Agreement
mutatis mutandis.

                  SECTION 23. CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST PLEDGOR ARISING OUT OF OR RELATING TO
THIS AGREEMENT, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW
YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, PLEDGOR, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR

DHC Stock Pledge Agreement

                                     XI-15
<PAGE>

CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO PLEDGOR AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 18; (IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER PLEDGOR IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING
SERVICE IN EVERY RESPECT; (V) AGREES THAT COLLATERAL AGENT RETAINS THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS
AGAINST PLEDGOR IN THE COURTS OF ANY OTHER JURISDICTION; AND (VI) AGREES THAT
THE PROVISIONS OF THIS SECTION 23 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL
OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.

                  SECTION 24. WAIVER OF JURY TRIAL. PLEDGOR AND COLLATERAL AGENT
HEREBY AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. The scope of this
waiver is intended to be all-encompassing of any and all disputes that may be
filed in any court and that relate to the subject matter of this transaction,
including without limitation contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims. Pledgor and Collateral
Agent acknowledge that this waiver is a material inducement for Pledgor and
Collateral Agent to enter into a business relationship, that Pledgor and
Collateral Agent have already relied on this waiver in entering into this
Agreement and that each will continue to rely on this waiver in their related
future dealings. Pledgor and Collateral Agent further warrant and represent that
each has reviewed this waiver with its legal counsel, and that each knowingly
and voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SECTION 24 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT. In the event of litigation, this Agreement may
be filed as a written consent to a trial by the court.

                  SECTION 25. COUNTERPARTS. This Agreement may be executed in
one or more counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. Delivery of an executed
counterpart of a signature page to this Agreement by facsimile transmission
shall be effective as delivery of a manually executed counterpart thereof.

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                                     XI-16
<PAGE>

                  SECTION 26.  SURETYSHIP WAIVERS BY PLEDGOR, ETC.

                  (a)      Pledgor agrees that its obligations hereunder are
irrevocable, absolute, independent and unconditional and shall not be affected
by any circumstance which constitutes a legal or equitable discharge of a
guarantor or surety other than payment in full of all Secured Obligations (other
than contingent indemnification Secured Obligations with respect to claims which
have not yet arisen). In furtherance of the foregoing and without limiting the
generality thereof, Pledgor agrees as follows: (i) Collateral Agent or any
Benefited Party may from time to time, without notice or demand and without
affecting the validity or enforceability of this Agreement or giving rise to any
limitation, impairment or discharge of Pledgor's obligations hereunder, (A)
renew, extend, accelerate or otherwise change the time, place, manner or terms
of payment of the Secured Obligations, (B) settle, compromise, release or
discharge, or accept or refuse any offer of performance with respect to, or
substitutions for, the Secured Obligations or any agreement relating thereto
and/or subordinate the payment of the same to the payment of any other
obligations, (C) request and accept guaranties of the Secured Obligations and
take and hold other security for the payment of the Secured Obligations, (D)
release, exchange, compromise, subordinate or modify, with or without
consideration, any other security for payment of the Secured Obligations, any
guaranties of the Secured Obligations, or any other obligation of any Person
with respect to the Secured Obligations, (E) enforce and apply any other
security now or hereafter held by or for the benefit of Collateral Agent or any
Benefited Party in respect of the Secured Obligations and direct the order or
manner of sale thereof, or exercise any other right or remedy that Collateral
Agent or any Benefited Party, or any of them, may have against any such
security, as Collateral Agent in its discretion may determine consistent with
the Credit Documents and any applicable security agreement, including
foreclosure on any such security pursuant to one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially reasonable,
and (F) exercise any other rights available to Collateral Agent or any Benefited
Party under the Credit Documents at law or in equity; and (ii) this Agreement
and the obligations of Pledgor hereunder shall be valid and enforceable and
shall not be subject to any limitation, impairment or discharge for any reason
(other than payment in full of all Secured Obligations (other than contingent
indemnification Secured Obligations with respect to claims which have not yet
arisen)), including without limitation the occurrence of any of the following,
whether or not Pledgor shall have had notice or knowledge of any of them: (A)
any failure to assert or enforce or agreement not to assert or enforce, or the
stay or enjoining, by order of court, by operation of law or otherwise, of the
exercise or enforcement of, any claim or demand or any right, power or remedy
with respect to the Secured Obligations or any agreement relating thereto, or
with respect to any guaranty of or other security for the payment of the Secured
Obligations, (B) any waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions of the Credit Documents (other
than this Agreement), or any agreement or instrument executed pursuant thereto,
or of any guaranty or other security for the Secured Obligations, (C) the
Secured Obligations, or any agreement relating thereto, at any time being found
to be illegal, invalid or unenforceable in any respect, (D) the application of
payments received from any source to the payment of indebtedness other than the
Secured Obligations, even though Collateral Agent or Benefited Parties, or any
of them, might have elected to apply such payment to any part or all of the
Secured Obligations, (E) any failure to perfect or continue perfection of a
security interest in any other collateral which secures any of the Secured

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                                     XI-17
<PAGE>

Obligations, (F) any defenses, set-offs or counterclaims which any Borrower may
allege or assert against Collateral Agent or any Benefited Party in respect of
the Secured Obligations, including but not limited to failure of consideration,
breach of warranty, statute of frauds, statute of limitations, accord and
satisfaction and usury, and (G) any other act or thing or omission, or delay to
do any other act or thing, which may or might in any manner or to any extent
vary the risk of Pledgor as an obligor in respect of the Secured Obligations.

                  (b)      Pledgor hereby waives, for the benefit of Benefited
Parties and Collateral Agent: (i) any right to require Collateral Agent or
Benefited Parties as a condition of payment or performance by Pledgor, to (A)
proceed against any Borrower, any guarantor of the Secured Obligations or any
other Person, (B) proceed against or exhaust any other security held from any
Borrower, any guarantor of the Secured Obligations or any other Person, (C)
proceed against or have resort to any balance of any deposit account or credit
on the books of Collateral Agent, any Benefited Party in favor of any Borrower
or any other Person, or (D) pursue any other remedy in the power of Collateral
Agent or any Benefited Party whatsoever; (ii) any defense arising by reason of
the incapacity, lack of authority or any disability or other defense of any
Borrower including, without limitation, any defense based on or arising out of
the lack of validity or the unenforceability of the Secured Obligations or any
agreement or instrument relating thereto or by reason of the cessation of the
liability of any Borrower from any cause other than payment in full of all
Secured Obligations; (iii) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the principal; (iv) any
defense based upon Collateral Agent's or any Benefited Party's errors or
omissions in the administration of the Secured Obligations, except behavior
which amounts to gross negligence or willful misconduct; (v) (A) any principles
or provisions of law, statutory or otherwise, which are or might be in conflict
with the terms of this Agreement and any legal or equitable discharge of
Pledgor's obligations hereunder, (B) the benefit of any statute of limitations
affecting Pledgor's liability hereunder or the enforcement hereof, (C) any
rights to set-offs, recoupments and counterclaims, and (D) promptness, diligence
and any requirement that Collateral Agent or any Benefited Party protect,
secure, perfect or insure any other security interest or lien or any property
subject thereto; (vi) notices, demands, presentments, protests, notices of
protest, notices of dishonor and notices of any action or inaction, notices of
default under the Credit Documents or any agreement or instrument related
thereto, notices of any renewal, extension or modification of the Secured
Obligations or any agreement related thereto, notices of any extension of credit
to any Borrower and notices of any of the matters referred to in Section 26(a)
and any right to consent to any thereof; and (vii) to the fullest extent
permitted by law, any defenses or benefits that may be derived from or afforded
by law which limit the liability of or exonerate guarantors or sureties, or
which may conflict with the terms of this Agreement.

                  (c)      Until the Secured Obligations shall have been paid in
full and the Commitments shall have terminated, Pledgor shall withhold exercise
of (i) any claim, right or remedy, direct or indirect, that Pledgor now has or
may hereafter have against any Borrower or any assets of any Borrower in
connection with this Agreement or the performance by Pledgor of its obligations
hereunder, in each case whether such claim, right or remedy arises in equity,
under contract, by statute, under common law or otherwise and including without
limitation (A) any right of subrogation, reimbursement or indemnification that
Pledgor now

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                                     XI-18
<PAGE>

has or may hereafter have against any Borrower, (B) any right to enforce, or to
participate in, any claim, right or remedy that Collateral Agent or any
Benefited Party now has or may hereafter have against any Borrower, and (C) any
benefit of, and any right to participate in, any other collateral or security
now or hereafter held by Collateral Agent or any Benefited Party, and (ii) any
right of contribution Pledgor now has or may hereafter have against any
guarantor of any of the Secured Obligations. Pledgor further agrees that, to the
extent the agreement to withhold exercise of its rights of subrogation,
reimbursement, indemnification and contribution as set forth herein is found by
a court of competent jurisdiction to be void or voidable for any reason, any
rights of subrogation, reimbursement or indemnification Pledgor may have against
any Borrower or against any other collateral or security, and any rights of
contribution Pledgor may have against any such guarantor, shall be junior and
subordinate to any rights Collateral Agent or Benefited Parties may have against
such Borrower, to all right, title and interest Collateral Agent or Benefited
Parties may have in any such other collateral or security, and to any right
Collateral Agent or Benefited Parties may have against any such guarantor.

                  (d)      Benefited Parties and Collateral Agent shall have no
obligation to disclose or discuss with Pledgor their respective assessments, or
Pledgor's assessment, of the financial condition of Borrowers. Pledgor has
adequate means to obtain information from Borrowers on a continuing basis
concerning the financial condition of Borrowers and their ability to perform
their obligations under the Credit Documents and Pledgor assumes the
responsibility for being and keeping informed of the financial condition of
Borrowers and of all circumstances bearing upon the risk of nonpayment of the
Secured Obligations. Pledgor hereby waives and relinquishes any duty on the part
of Collateral Agent or any Benefited Party to disclose any matter, fact or thing
relating to the business, operations or condition of Borrowers now known or
hereafter known by Collateral Agent or any Benefited Party.

                  SECTION 27. LIMITED RECOURSE. Notwithstanding anything to the
contrary in this Agreement, no recourse shall be had, whether by levy or
execution, or under any law, or by the enforcement of any assessment or penalty
or otherwise, for the payment of any of the Secured Obligations, against Pledgor
individually or personally, any successor or Affiliate of Pledgor, or any of the
assets of the aforesaid persons, it being expressly understood that the sole
remedies available to Collateral Agent and the Secured Parties pursuant to this
Agreement with respect to the Secured Obligations shall be against the Pledged
Collateral; provided that nothing in this Section 27 shall (i) constitute a
waiver, release or discharge of any of the Secured Obligations, but the same
shall continue until fully paid, discharged, observed or performed, or (ii) in
any way limit or restrict any right of Collateral Agent or the Secured Parties
to foreclose the Liens and the security interest granted pursuant to this
Agreement or otherwise realize upon any of the Pledged Collateral.

                  [Remainder of page intentionally left blank.]

DHC Stock Pledge Agreement

                                     XI-19
<PAGE>

                  IN WITNESS WHEREOF, Pledgor and Collateral Agent have caused
this Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.

                               DANIELSON HOLDING CORPORATION,
                               as Pledgor

                               By: ___________________________________
                               Name:  Philip G. Tinkler
                               Title: Chief Financial Officer

                               Notice Address for Pledgor:

                               Danielson Holding Corporation
                               2 North Riverside Plaza
                               Suite 600
                               Chicago, Illinois 60606
                               Attention: Philip G. Tinkler
                               Telephone:  (312) 466-3842
                               Facsimile:  (312) 470-1126

                               with copies to:

                               Neal, Gerber & Eisenberg LLP
                               Two North LaSalle Street
                               Suite 2200
                               Chicago, Illinois 60602
                               Attention: David S. Stone
                               Telephone: (312) 269-8000
                               Facsimile:  (312) 269-1747

                               and

                               Skadden, Arps, Slate, Meagher & Flom LLP
                               333 W. Wacker Drive, Suite 2100
                               Chicago, Illinois 60606
                               Attention:  Peter C. Krupp
                               Telephone:  (312) 407-0855
                               Facsimile:  (312) 407-0411

DHC Stock Pledge Agreement

                                      S-1
<PAGE>

                               BANK OF AMERICA, N.A.,
                               as Collateral Agent

                               By: ___________________________
                               Name: _________________________
                               Title: ________________________

                               Notice Address for Collateral Agent:
                               Bank of America, N.A., as Collateral Agent
                               555 So. Flower Street, 17th Floor
                               CA9-706-17-54
                               Los Angeles, California 90071
                               Attention:  David Price, Vice President
                               Voice: (213) 345-1300
                               Fax: (415) 503-5011
                               email: david.price@bankofamerica.com

DHC Stock Pledge Agreement

                                      S-2
<PAGE>

                                   SCHEDULE I

                  Attached to and forming a part of the Pledge Agreement dated
as of March __, 2004 between Danielson Holding Corporation, as Pledgor, and Bank
of America, N.A., as Collateral Agent.

                                     Part A

<TABLE>
<CAPTION>
                                                                       AMOUNT OF
                                    CLASS             CERTIFICATE        EQUITY          PERCENTAGE
          ISSUER              OF EQUITY INTEREST          NOS.          INTERESTS          PLEDGED
<S>                           <C>                     <C>               <C>              <C>
Covanta Energy Corporation       Common Stock               1           200 shares           100%
</TABLE>

DHC Stock Pledge Agreement

                                  SCHEDULE I-1

<PAGE>

                                   SCHEDULE II

                                  FILING OFFICE

Secretary of State of the State of Delaware

DHC Stock Pledge Agreement

                                  SCHEDULE II-1

<PAGE>

                                  SCHEDULE III

                  NAMES OF PLEDGOR USED IN THE LAST FIVE YEARS

None.

DHC Stock Pledge Agreement

                                 SCHEDULE III-1

<PAGE>

SCHEDULE IV

                                PLEDGE AMENDMENT

                  This Pledge Amendment, dated ____________, ____, is delivered
pursuant to Section 6(b) of the Pledge Agreement referred to below. The
undersigned hereby agrees that this Pledge Amendment may be attached to the
Pledge Agreement dated March __, 2004, between Danielson Holding Corporation, as
Pledgor, and Bank of America, N.A., as Collateral Agent (the "PLEDGE AGREEMENT,"
capitalized terms defined therein being used herein as therein defined), and
that the Capital Stock listed on this Pledge Amendment shall be deemed to be
part of the Pledged Equity and shall become part of the Pledged Collateral and
shall secure all Secured Obligations.

                         DANIELSON HOLDING CORPORATION,
                         as Pledgor

                         By: ___________________________
                             Title:

<TABLE>
<CAPTION>
                 Class of                             Amount of      Percentage
                  Equity             Certificate       Equity         Ownership           Pledged
Issuer           Interests                Nos.        Interest        Interest           Percentage
------           ---------                ----        --------        --------           ----------
<S>              <C>                 <C>              <C>             <C>                <C>
</TABLE>

DHC Stock Pledge Agreement

                                      XI-2