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                                                                Exhibit 10.20

                                                                EXECUTION COPY



                              FORBEARANCE AGREEMENT

                  FORBEARANCE AGREEMENT (this "AGREEMENT") dated as of February
22, 2002, among AMERICAN COMMERCIAL LINES HOLDINGS LLC, a Delaware limited
liability company ("HOLDINGS"), AMERICAN COMMERCIAL LINES LLC, a Delaware
limited liability company and a wholly-owned subsidiary of Holdings (the
"BORROWER"), those subsidiaries of the Borrower identified as a Subsidiary
Guarantor on the Subsidiary Guarantor Signature Pages attached hereto
(collectively with Holdings, the "GUARANTORS" and, together with the Borrower,
the "CREDIT PARTIES"), the several banks and other financial institutions
identified as Lenders on the Lender Signature Pages attached hereto (the
"LENDERS" and, each individually, a "LENDER"), and JPMORGAN CHASE BANK (formerly
known as The Chase Manhattan Bank), a New York banking corporation, as
administrative agent for the Lenders (the "ADMINISTRATIVE AGENT"). Capitalized
terms used but not otherwise defined herein shall have the meanings assigned to
such terms in the Credit Agreement referred to below.

                                    RECITALS

                  WHEREAS, the Borrower, the Guarantors, the Administrative
Agent and the Lenders are parties to that certain Credit Agreement dated as of
June 30, 1998 (as amended, modified, supplemented or restated from time to time,
the "CREDIT AGREEMENT");

                  WHEREAS, an Event of Default has occurred and is continuing as
of the date hereof based on non-compliance by Holdings and the Borrower with
Sections 6.11 and 6.12 of the Credit Agreement and as a result of an event
specified in clause (f) of Article VII of the Credit Agreement (collectively,
the "ACKNOWLEDGED EVENTS OF DEFAULT");

                  WHEREAS, by letter to the Borrower dated January 10, 2002, the
Administrative Agent, on behalf of the Lenders, notified the Borrower of certain
of the Acknowledged Events of Default and expressly reserved all rights and
remedies of the Lenders under the Loan Documents;

                  WHEREAS, Holdings, the Borrower and the Required Lenders
desire to implement a financial restructuring (the "FINANCIAL RESTRUCTURING") in
accordance with the Term Sheet attached hereto as EXHIBIT A (the "TERM SHEET");

                  WHEREAS,  in order to implement the Financial Restructuring,
the Borrower intends to (a) prepare and deliver an Offering Memorandum,
Solicitation of Consents and Acceptances and Disclosure Statement, to
consummate the exchange of the Borrower's outstanding Senior Unsecured Notes
in accordance with the Term Sheet (the "EXCHANGE OFFER"), and (b) prepare and,
if necessary, file and seek approval of a disclosure  statement (the
"DISCLOSURE STATEMENT") and plan of reorganization (the "PLAN") consistent in
all material respects with the terms set forth in this Agreement and the Term
Sheet implementing the terms of the Financial  Restructuring in a case
(the "CHAPTER 11 CASE") filed under the United States Bankruptcy Code,
11 U.S.C.ss.101 et seq. (the "BANKRUPTCY CODE");

                  WHEREAS, if the Exchange Offer is unsuccessful, the Borrower
intends to use its best efforts to have the Disclosure Statement approved and
such Plan confirmed by the United States Bankruptcy Court for the District of
Delaware (the "BANKRUPTCY Court") in the Chapter 11 Case as expeditiously as
possible under the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure
(the "BANKRUPTCY RULES");





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                  WHEREAS, Holdings and the Borrower have asked the
Administrative Agent and the Lenders to forbear from exercising their rights and
remedies arising from the Acknowledged Events of Default during the period (the
"FORBEARANCE PERIOD") from the date hereof until and including the earlier of
(i) April 30, 2002 or, if the Receivables Program is extended beyond April 30,
2002 on the same terms as those upon which such program was extended as a
condition precedent to the effectiveness of this Agreement, such later
termination date of the Receivables Program, but in no event later than August
1, 2002 (the "NEW FORBEARANCE TERMINATION DATE") or (ii) the occurrence of a
Forbearance Default (as defined below); and

                  WHEREAS, the Administrative Agent and the Lenders are, upon
and subject to the terms and conditions specified in this Agreement, willing to
forbear from exercising their rights and remedies arising from the Acknowledged
Events of Default until the New Forbearance Termination Date in accordance with
the terms hereof.

                  NOW, THEREFORE, IN CONSIDERATION of the premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

Section 1. ACKNOWLEDGEMENT OF LOANS AND SECURITY. The Credit Parties acknowledge
and confirm that (a) the Borrower's obligation to repay the outstanding
principal amount of the Loans and all accrued and unpaid interest in respect
thereof and to reimburse the Issuing Bank for any drawing on a Letter of Credit,
and each Guarantor's Guarantee of each such obligation, is unconditional and not
subject to any offsets, defenses or counterclaims, (b) each Security Document is
effective to create in favor of the Collateral Agent, for the ratable benefit of
the Secured Parties, a legal, valid and enforceable security interest in the
Collateral (as defined in such Security Document), in each case fully perfected
and prior and superior in right to any other person (assuming, in the case of
the Pledge Agreement, that the Collateral Agent continues to hold the
certificated Collateral pledged thereunder), subject to the Liens permitted by
Section 6.02 of the Credit Agreement, (c) the Administrative Agent and the
Lenders have performed fully all of their respective obligations under the
Credit Agreement and the other Loan Documents and (d) by entering into this
Agreement, the Administrative Agent and the Lenders do not waive or release any
term or condition of the Credit Agreement or any of the other Loan Documents or
any of their rights or remedies under such Loan Documents or applicable law or
any of the obligations of any Credit Party thereunder except as specifically set
forth herein.

Section 2. FORBEARANCE. Subject to the other terms and conditions of this
Agreement, the Required Lenders hereby agree (such agreement, the "FORBEARANCE")
until the New Forbearance Termination Date to forbear the exercise of rights and
remedies otherwise available under the Credit Agreement and the other Loan
Documents solely on account of an Acknowledged Event of Default; PROVIDED, that
the Administrative Agent and the Lenders shall be free to exercise any or all of
their rights and remedies arising on account of any Acknowledged Event of
Default at any time after the occurrence of a Forbearance Default (as defined
below).

Section 3. FORBEARANCE DEFAULT. Nothing set forth herein or contemplated hereby
(a) is intended to or shall be construed as a waiver of or acquiescence to any
Acknowledged Event of Default, which shall continue in existence subject only to
the terms of the Forbearance, or (b) shall constitute an agreement by the
Administrative Agent or the Lenders to forbear the exercise of any of the rights
and remedies available to the Administrative Agent and/or the Lenders under the
Credit Agreement and the other Loan Documents (all of which rights and remedies
are hereby expressly reserved by the Administrative Agent and the Lenders) upon
and after the occurrence of a Forbearance Default. For purposes hereof, the term
"FORBEARANCE DEFAULT" shall mean the existence of any or all of the following:
(a) any Event of Default under the Credit Agreement or any other Loan Document
other than the


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Acknowledged Events of Default; (b) a breach by the Credit Parties of any term
of this Agreement; (c) the Exchange Offer or the Plan provides or is modified
to provide for treatment of the Administrative Agent or any Lender in a manner
that is adverse to the treatment described in the Term Sheet; (d) the Plan
provides, or is modified without the consent of the Required Lenders to
provide, that either the holders of the Senior Unsecured Notes or the holders
of the Capital Stock of Holdings, in each case as a class, will receive
aggregate recoveries in excess of that contemplated by the Term Sheet, or the
Exchange Offer or the Plan is modified in a manner which substantially
decreases the likelihood that the Financial Restructuring will be consummated;
(e) unless the Borrower is proceeding with the Chapter 11 Case in a manner
reasonably acceptable to the Administrative Agent, the date that the Exchange
Offer is distributed to holders of Senior Unsecured Notes is later than April
1, 2002; (f) the Lock-Up, Support and Voting Agreement reasonably satisfactory
to the Administrative Agent by and among Holdings, the Borrower and Danielson
Holding Corporation ("DHC") and the Lock-Up, Support and Voting Agreement
reasonably satisfactory to the Administration Agent by and among Holdings, the
Borrower, certain holders of the Capital Stock of Holdings and certain holders
of the Senior Unsecured Notes (collectively, the "LOCK-UPS") shall for any
reason cease to be in full force and effect to bind (i) holders holding at
least 66 2/3% of the outstanding aggregate principal amount of the Senior
Unsecured Notes and (ii) at least a majority of the holders of such notes; (g)
the Receivables Program is for any reason terminated, suspended or unwound; (h)
unless the Borrower is proceeding with the Chapter 11 Case in a manner
reasonably acceptable to the Administrative Agent, the Exchange Offer is
withdrawn or modified from that described in the Term Sheet in a manner that is
adverse to the interests of the Lenders, or is accepted by holders holding less
than 95% of the outstanding aggregate principal amount of the Senior Unsecured
Notes; (i) the recapitalization agreement by and among Holdings, the Borrower,
DHC and certain holders of the Capital Stock of Holdings (the "RECAPITALIZATION
AGREEMENT") pursuant to which DHC and/or one or more of its subsidiaries will
acquire 100% of the issued and outstanding Capital Stock of Holdings or the
Borrower is executed later than March 15, 2002; or (j) the Recapitalization
Agreement is for any reason terminated. The Administrative Agent and the
Lenders shall be free to exercise any or all of their rights and remedies
arising on account of any Event of Default under the Credit Agreement or any
other Loan Document upon the earlier of (x) the occurrence of a Forbearance
Default and (y) the New Forbearance Termination Date. Notwithstanding any term
to the contrary contained in this Agreement, the Credit Agreement or any other
Loan Document, if any Senior Unsecured Debt is accelerated prior to its stated
maturity or any principal or interest payments are made with respect to such
Senior Unsecured Debt prior to the New Forbearance Termination Date, the
Administrative Agent and the Lenders shall be free to exercise any or all of
their rights and remedies under the Credit Agreement or any other Loan
Document.

Section 4. LOAN DOCUMENTS UNCHANGED. This Agreement shall not modify or affect
the Credit Parties' obligation to comply fully with any duty, term, condition or
covenant contained in the Credit Agreement and the other Loan Documents or the
rights and remedies of the Administrative Agent and the Lenders under the Loan
Documents, except as expressly set forth herein. Except as modified hereby, all
of the terms and provisions of the Loan Documents remain in full force and
effect. Except as expressly provided herein, the execution and delivery of this
Agreement shall not: (a) constitute an extension, modification, or waiver of any
aspect of the Loans, the Credit Agreement or any other Loan Document; (b) extend
the terms of the Loans or the Credit Agreement or the due date of any of the
obligations thereunder; (c) give rise to any obligation on the part the
Administrative Agent or any Lender to extend, modify or waive any term or
condition of the Loans, the Credit Agreement or any other Loan Document; or (d)
give rise to any defenses or counterclaims to the Lenders' right to compel
payment of the Loans or to otherwise enforce its or their rights and remedies
under the Loan Agreement and the other Loan Documents. The Credit Parties hereby
agree that nothing herein shall modify the obligations of the Credit Parties
pursuant to the Loan Documents to pay principal, interest, fees and other
amounts as and when the same are due thereunder.



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Section 5. CONDITIONS. This Agreement shall be effective as of the date first
above written at such time as the following conditions shall have been satisfied
(in form and substance reasonably acceptable to the Administrative Agent):

(a) Receipt by the Administrative Agent of a copy of this Agreement duly
executed by each of the Credit Parties and the Required Lenders.

(b) Receipt by the Administrative Agent of evidence reasonably satisfactory to
the Administrative  Agent of the extension of the Receivables Program.

(c) Receipt by the Administrative Agent of evidence reasonably satisfactory to
the Administrative Agent that holders holding not less than 66 2/3% of the
outstanding aggregate principal amount of the Senior Unsecured Notes have
executed the Lock-Ups.

(d) Payment by the Borrower of all reasonable fees and expenses of the
Administrative Agent (including the reasonable fees, disbursements and other
charges of Cravath, Swaine & Moore and Morgan Lewis & Bockius LLP, special
counsel to the Administrative Agent) for which invoices have been submitted, in
connection with the preparation, execution and delivery of this Agreement, the
administration of the Credit Agreement and the other Loan Documents and the
protection of the rights and remedies of the Secured Parties thereunder.

Section 6. BORROWER FURTHER ASSURANCES. The Borrower hereby agrees to use its
commercially reasonable efforts to consummate the Exchange Offer and, if the
Exchange Offer is unsuccessful, to have the Disclosure Statement approved by the
Bankruptcy Court, and thereafter to use its commercially reasonable efforts to
obtain an order of the Bankruptcy Court confirming the Plan, in each case as
expeditiously as commercially reasonable under the Bankruptcy Code and
Bankruptcy Rules, and consistent in all material respects (including with
respect to the treatment of claims and interests) with the terms and conditions
of the Term Sheet.

Section 7. ACKNOWLEDGMENT. This Agreement is not and shall not be deemed to be
a solicitation for approval of the Financial Restructuring or for consents to
the Plan.

Section 8. REPRESENTATIONS AND WARRANTIES. (a) Each of the Credit Parties
represents and warrants as follows:

(i)      it has taken all necessary action to authorize the execution, delivery
         and performance of this Agreement;

(ii)     this Agreement has been duly executed and delivered by such Credit
         Party and constitutes such Credit Party's legal, valid and binding
         obligations, enforceable in accordance with its terms, except as such
         enforceability may be subject to (A) bankruptcy, insolvency,
         reorganization, fraudulent conveyance or transfer, moratorium or
         similar laws affecting creditors' rights generally and (B) general
         principles of equity (regardless of whether such enforceability is
         considered in a proceeding at law or in equity);

(iii)    no consent, approval, authorization or order of, or filing,
         registration or qualification with, any court or governmental authority
         or third party is required in connection with the execution, delivery
         or performance by such Credit Party of this Agreement; and

(iv)     as of the date hereof, except for the Acknowledged Events of Default,
         no Default or Event of Default has occurred and is continuing.


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(b)      Each of the Administrative Agent and each Lender represents and
         warrants as follows:

(i)      it has taken all necessary action to authorize the execution, delivery
         and performance of this Agreement;

(ii)     this Agreement has been duly executed and delivered by such
         Administrative Agent and Lender and constitutes such Administrative
         Agent's and such Lender's legal, valid and binding obligations,
         enforceable in accordance with its terms except as such enforceability
         may be subject to (A) bankruptcy, insolvency, reorganization,
         fraudulent conveyance or transfer, moratorium or similar laws affecting
         creditors rights generally and (B) general principles of equity
         (regardless of whether such enforceability is considered in a
         proceeding at law or in equity); and

(iii)    No consent, approval, authorization or order of, or filing,
         registration or qualification with, any court or governmental authority
         or third party is required in connection with the execution, delivery
         or performance by such Administrative Agent and Lender of this
         Agreement.

Section 9. GUARANTORS. The Guarantors acknowledge and consent to all of the
terms and conditions of this Agreement and agree that this Agreement and all
documents executed in connection herewith do not operate to reduce or discharge
the Guarantors' obligations under the Loan Documents.

Section 10. ENTIRE AGREEMENT; AMENDMENTS; BINDING EFFECT. This Agreement
embodies the entire agreement between the parties hereto with respect to the
Financial Restructuring and supersedes all prior agreements and understandings,
oral or written, if any, relating thereto. This Agreement may not be modified,
altered, amended or supplemented except by an agreement in writing signed by
Holdings, the Company, the Guarantors and the Required Lenders. This Agreement
shall be binding upon and inure to the benefit of the parties hereto (and, with
respect to the Forbearance, by virtue of having been executed and delivered by
the Required Lenders, all the Lenders) and their respective successors and
assigns.

Section 11. NO RELEASE. This Agreement shall not be deemed or construed to be a
satisfaction, reinstatement, novation, or release of the Loans, the Credit
Agreement or any other Loan Document, or, except as expressly provided herein, a
waiver by the Administrative Agent or any Lender of any of its rights under such
documents, or at law or in equity.

Section 12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall constitute one and the same instrument. Delivery of
executed counterparts of this Agreement by telecopy shall be effective as an
original and shall constitute a representation that an original will be
delivered.

Section 13. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO ANY
CONFLICTS OF LAW PROVISION WHICH WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY
OTHER JURISDICTION). By its execution and delivery of this Agreement, each of
the parties hereto hereby irrevocably and unconditionally agrees for itself that
any legal action, suit or proceeding against it with respect to any matter under
or arising out of or in connection with this Agreement or for recognition or
enforcement of any judgment rendered in any such action, suit or proceeding, may
be brought in any New York State court and any Federal court of


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the United States of America sitting in New York. By execution and delivery of
this Agreement, each of the parties hereto hereby irrevocably accepts and
submits itself to the nonexclusive jurisdiction of each such court, generally
and unconditionally, with respect to any such action, suit or proceeding.

Section 14. SPECIFIC PERFORMANCE. It is understood and agreed by the parties
that money damages would not be a sufficient remedy for any breach of this
Agreement by any party and each non-breaching party shall be entitled to the
sole and exclusive remedy of specific performance and injunctive or other
equitable relief, including attorneys fees and costs, as a remedy of any such
breach, and each party agrees to waive any requirement for the securing or
posting of a bond in connection with such remedy.

Section 15. ASSIGNMENT. Except as set forth in Section 10, no rights or
obligations of any party under this Agreement may be assigned or transferred to
any other person or entity.

Section 16. CONSIDERATION. It is hereby acknowledged by the Borrower and the
Administrative Agent and each of the Lenders that no consideration shall be due
or paid to the Administrative Agent or any Lender for the Forbearance, other
than the Borrower's agreement to use its best efforts to obtain approval of the
Disclosure Statement and to confirm the Plan in accordance with the terms and
conditions of this Agreement.

Section 17. NO THIRD PARTY BENEFICIARIES. This Agreement shall be solely for the
benefit of the parties hereto, including their permitted assigns, and no other
person or entity shall be a third party beneficiary hereof. Nothing in this
Agreement, express or implied, shall give to any party or entity other than the
parties any benefit or any legal or equitable right, remedy or claim under this
Agreement.


                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]





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         IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date and year
first above written.

                                BORROWER:
                                --------

                                AMERICAN COMMERCIAL LINES LLC,
                                a Delaware limited liability company


                                By:
                                   ----------------------------------
                                   Name:
                                   Title:


                                HOLDINGS:
                                --------

                                AMERICAN COMMERCIAL LINES HOLDINGS LLC,
                                a Delaware limited liability company


                                By:
                                   ------------------------------------
                                   Name:
                                   Title:




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                      [SUBSIDIARY GUARANTOR SIGNATURE PAGE]


                                                   SUBSIDIARY GUARANTORS:
                                                   ---------------------

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                      [ADMINISTRATIVE AGENT SIGNATURE PAGE]


                                  ADMINISTRATIVE AGENT:
                                  --------------------

                                  JPMORGAN CHASE BANK, as Administrative Agent
                                  and as a Lender


                                  By:
                                     -----------------------------------------
                                     Name:
                                     Title:



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                [SIGNATURE PAGE TO THE FORBEARANCE AGREEMENT]





                         Name of Lender:
                                         --------------------------------------


                                         By:
                                             ---------------------------------
                                             Name:
                                             Title: