Document:

EXHIBIT 10.1(a)
                                                                 ---------------

                                 FIRST AMENDMENT
                               TO REVOLVING CREDIT
                           AND PARTICIPATION AGREEMENT

     This FIRST AMENDMENT TO REVOLVING CREDIT AND PARTICIPATION AGREEMENT (this
"Amendment") is dated as of July 30, 2001 and entered into by and among COVANTA
ENERGY CORPORATION, a Delaware corporation ("Company"), and THE SUBSIDIARIES
LISTED ON THE SIGNATURE PAGES HEREOF AS BORROWERS (collectively, Company and
such Subsidiaries of Company are "Borrowers" and each a "Borrower"), the Loan
Parties listed on the signature pages hereof, the financial institutions parties
hereto (each a "Lender" and collectively, the "Lenders"), BANK OF AMERICA, N.A.,
as Administrative Agent for the Lenders (the "Administrative Agent"), and
DEUTSCHE BANK AG, NEW YORK BRANCH, as Documentation Agent for the Lenders
("Documentation Agent"), and is made with reference to that certain Revolving
Credit and Participation Agreement dated as of March 14, 2001 (as amended,
restated, supplemented or otherwise modified as of the date hereof, the "Credit
Agreement"), by and among the Borrowers, the Lenders listed therein as Lenders,
Administrative Agent and Documentation Agent. Capitalized terms used herein
without definition shall have the same meanings herein as set forth in the
Credit Agreement.

                                    RECITALS

     WHEREAS, the Borrowers and Lenders desire to amend the Credit Agreement to
(i) increase the Cumulative Allowable Cash Usage for the months of July and
August 2001 as set forth in the Monthly Budget, attached to the Credit Agreement
as Schedule 1.1(e), (ii) change the definition of "Adjusted EBIT" and (iii) make
certain other amendments as set forth below;

     NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

Section 1. AMENDMENTS TO THE CREDIT AGREEMENT

1.1  Provisions Relating to Defined Terms

     A. Definition of "Adjusted EBIT". Subsection 1.1 of the Credit Agreement is
hereby amended by deleting the phrase "(ii) `Equity in Net Income of Investees
and Joint Ventures' and (iii)" in the definition of "Adjusted EBIT" and
substituting therefor the words "and (ii)".

     B. New Definitions. Subsection 1.1 of the Credit Agreement is hereby
amended by inserting the following definition in the appropriate alphabetical
order:

          "Aviation Note" means the note issued to Company upon consummation of
     the sale of Company's aviation fueling business pursuant to the Ogden
     Aviation Fueling Services Acquisition Agreement dated July 10, 2001 by and
     among Allied Aviation Holdings Corporation, Tampa Pipeline Transport
     Corporation, Tampa Bay Pipeline Corporation, and the other Persons named
     therein, which note shall be on terms no less favorable to Company and in a
     principal amount no greater than described in Exhibit A to such Ogden
     Aviation Fueling Services Acquisition Agreement as in effect on the date
     hereof.

          "First Amendment" means that certain First Amendment to the Revolving
     Credit and Participation Agreement dated July 30, 2001 by and among the
     Borrowers, the Pooled Facility Lenders, the Opt-Out Lenders, the Existing
     Pooled Facility Agents, the Existing Opt-Out Facility Agents,
     Administrative Agent, and Documentation Agent.

          "First Amendment Effective Date" means the `Amendment Effective Date'
     as defined in the First Amendment."

1.2  Provisions Relating to the Exhibits and Schedules

     A. Schedule 1.1(e). Schedule 1.1(e) to the Credit Agreement is hereby
amended by (i) deleting the number "(193,000)" in the Cumulative Allowable Cash
Usage line for the month of July 2001 and substituting therefor the number
"(217,000)" and (ii) deleting the number "(193,000)" in the Cumulative Allowable
Cash Usage line for the month of August 2001 and substituting therefor the
number "(223,000)".

     B. Schedule 1.1(k). Schedule 1.1(k) to the Credit agreement is hereby
amended by adding the LICA DSRF Letter of Credit in the amount of $300,000
thereto.

     C. Compliance Certificate. Attachment No. 1 to Exhibit V to the Credit
Agreement is hereby deleted in its entirety and replaced with the revised
Attachment No. 1 attached hereto as Annex A.

1.3  Provision Relating to Investment Spending

     A. Subsection 7.3(vii). Subsection 7.3(vii) is hereby amended by inserting
the words "Other than during the months of July 2001 and August 2001," in the
beginning thereof.

     B. Subsection 7.3(xiii). Subsection 7.3 is hereby amended by (i) deleting
the word "and" after clause (xiii), (ii) deleting the "." at the end of clause
(xiv) and substituting therefor the word "and", and (iii) adding the following
new clause (xv) at the end thereof:

          "(xv) Company may make and own the Investment consisting of the
     Aviation Note."

1.4  Provision Relating to Asset Sales

     Subsection 7.7(vii)(b) is hereby amended by inserting the words "with
exception to the Aviation Note," in the beginning thereof.

1.5  Provision Relating to Revolving Loans

     Subsection 3.1A is hereby amended by (i) deleting the word "or" after
clause (v), (ii) deleting the "." at the end of clause (vi) and substituting
therefor the word "or" and (iii) adding the following new clause (vii) at the
end thereof:

     "(vii) any Letter of Credit from and after the First Amendment Effective
Date through and including August 31, 2001."

Section 2. BORROWER'S REPRESENTATIONS AND WARRANTIES

     In order to induce the Lenders to enter into this Amendment and to amend
the Credit Agreement in the manner provided herein, the Borrowers represent and
warrant to each Lender that the following statements are true, correct and
complete:

     A. Corporate Power and Authority. Each Loan Party has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, the Credit
Agreement as amended by this Amendment (the "Amended Agreement").

     B. Authorization of Agreements. The execution and delivery of this
Amendment has been duly authorized by all necessary corporate action on the part
of each Loan Party and the performance of the Amended Agreement has been duly
authorized by all necessary corporate action on the part of each Borrower

     C. No Conflict. The execution and delivery by each Loan Party of this
Amendment and the performance by each Borrower of the Amended Agreement do not
and will not (i) violate any provision of any law or any governmental rule or
regulation applicable to any Loan Party or any of its Subsidiaries, or the
Certificate or Articles of Incorporation or Certificate of Formation or Bylaws
or Operating Agreement of any Loan Party or any of its Subsidiaries or any
order, judgment or decree of any court or other agency of government binding on
any Loan Party or any of its Subsidiaries, (ii) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a default
under any indenture, mortgage, deed of trust, credit agreement or loan
agreement, or any other material agreement, contract or instrument to which any
Loan Party or any of its Subsidiaries is a party or by which it or any of its
property or assets is bound or to which it may be subject (each such indenture,
mortgage, deed of trust, credit agreement, loan agreement, material agreement,
contract or instrument, a "Contractual Obligation"), (iii) result in or require
the creation or imposition of any Lien upon any of the properties or assets of
any Loan Party or any of its Subsidiaries (other than Liens created under any of
the Loan Documents in favor of Administrative Agent or Collateral Agent on
behalf of the Banks), or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of any Loan
Party or any of its Subsidiaries.

     D. Governmental Consents. The execution and delivery by each Loan Party of
this Amendment and the performance by each Borrower of the Amended Agreement do
not and will not require any registration with, consent or approval of, or
notice to, or other action to, with or by, any federal, state or other
governmental authority or regulatory body.

     E. Binding Obligation. This Amendment has been duly executed and delivered
by each Loan Party and this Amendment and the Amended Agreement is the legally
valid and binding obligations of each Loan Party enforceable against each Loan
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.

     F. Incorporation of Representations and Warranties From Credit Agreement.
The representations and warranties contained in Section 5 of the Credit
Agreement are and will be true, correct and complete in all material respects on
and as of the Amendment Effective Date (as hereinafter defined) to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case they were true, correct and complete in all material respects on and as of
such earlier date.

     G. Absence of Default. As of the date hereof after giving effect hereto,
there exists no Default or Event of Default under the Credit Agreement.

Section 3. ACKNOWLEDGEMENT AND CONSENT

     Each Borrower and Subsidiary Guarantor hereby acknowledges that such Loan
Party has read this Amendment and consents to the terms hereof and further
hereby confirms and agrees that, notwithstanding the effectiveness of this
Amendment, the obligations of such Loan Party under each of the Loan Documents
to which such Loan Party is a party shall not be impaired and each of the Loan
Documents to which such Loan Party is a party are, and shall continue to be, in
full force and effect and are hereby confirmed and ratified in all respects.

Section 4. MISCELLANEOUS

     A. Reference to and Effect on the Credit Agreement and the Other Loan
Documents.

     (i) On and after the Amendment Effective Date, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like
import referring to the Credit Agreement, and each reference in the other Loan
Documents to the "Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement shall mean and be a reference to the
Amended Agreement.

     (ii) Except as specifically amended by this Amendment, the Credit Agreement
and the other Loan Documents shall remain in full force and effect and are
hereby ratified and confirmed.

     (iii) The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any provision of, or
operate as a waiver of any right, power or remedy of any Agent or any Lender
under, the Credit Agreement or any of the other Loan Documents.

     B. Fees and Expenses. Each Borrower acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Administrative Agent, Documentation Agent or the Lenders and their respective
counsel with respect to this Amendment and the documents and transactions
contemplated hereby shall be for the account of the Borrowers.

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

     D. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL 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.

     E. Counterparts; Effectiveness. This Amendment may be executed in any
number of 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. This Amendment shall become effective upon the execution of a
counterpart hereof by each Borrower, each Subsidiary Guarantor and the Lenders
constituting Requisite Lenders and receipt by each Borrower, Administrative
Agent and Documentation Agent of written or telephonic notification of such
execution and authorization of delivery thereof (the date of satisfaction of
such conditions being referred to herein as the "Amendment Effective Date").

               [Remainder of this page intentionally left blank.]

<PAGE>

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

                  BORROWERS:

                                         COVANTA ENERGY CORPORATION

                                         By:    /s/ Jeffrey R. Horowitz
                                              ----------------------------------
                                              Name:  Jeffrey R. Horowitz
                                              Title:  Authorized Officer

                                         Each of the entities named on
                                         Schedule A annexed hereto, as
                                         Borrowers

                                         By:    /s/ Jeffrey R. Horowitz
                                              ----------------------------------
                                              Name:  Jeffrey R. Horowitz
                                              Title:  Authorized Officer

                                         Each of the entities named on
                                         Schedule B annexed hereto, as
                                         Subsidiary Guarantors

                                         By:    /s/ Peter Allen
                                              ----------------------------------
                                              Name:  Peter Allen
                                              Title:  Authorized Officer

                                         Each of the entities named on
                                         Schedule C annexed hereto, as
                                         Subsidiary Guarantors

                                         By:    /s/ Jeffrey R. Horowitz
                                              ----------------------------------
                                              Name:  Jeffrey R. Horowitz
                                              Title:  Authorized Officer

<PAGE>

AGENTS AND LENDERS:

                                         BANK OF AMERICA, N.A.,
                                         As Administrative Agent,
                                         Co-Arranger, Co-Book Runner and as
                                         a Lender

                                         By:    /s/ Michael R. Heredia
                                              ----------------------------------
                                              Name:  Michael R. Heredia
                                              Title:  Managing Director

<PAGE>

                                  DEUTSCHE BANK AG, NEW YORK BRANCH
                                  As Documentation Agent,
                                  Co-Arranger, Co-Book Runner and as
                                  a Lender

                                  By:  /s/ Keith C. Braun      /s/ Mark B. Cohen
                                       -----------------------------------------
                                       Name: Keith C. Braun    Mark B. Cohen
                                       Title: Vice President   Managing Director
                                                               Head of Workout

<PAGE>

                                         BAYERISCHE HYPO-UND VEREINSBANK AG,
                                         as a Lender

                                         By:    /s/ Salvatore Esposito
                                              ----------------------------------
                                              Name:  Salvatore Esposito
                                              Title:  Director

                                         By:    /s/ Michael D. Novellino
                                              ----------------------------------
                                              Name:  Michael D. Novellino
                                              Title:  Associate Director

<PAGE>

                                         CANADIAN IMPERIAL BANK OF COMMERCE,
                                         as a Lender

                                         By:    /s/ D.C. Smith
                                              ----------------------------------
                                              Name:  D.C. Smith
                                              Title:  Managing Director

                                         By:    /s/ Rocco Calarco
                                              ----------------------------------
                                              Name:  Rocco Calarco
                                              Title:  Director

<PAGE>

                                         CLARICA LIFE INSURANCE COMPANY,
                                         as a Lender

                                         By:    /s/ Keith Cressman
                                              ----------------------------------
                                              Name:  Keith Cressman
                                              Title:  Director, Structured
                                                      Finance

<PAGE>

                                         CREDIT SUISSE FIRST BOSTON,
                                         as a Lender

                                         By:    /s/ Andrea E. Shlone
                                              ----------------------------------
                                              Name:  Andrea E. Shlone
                                              Title:  Vice President

                                         By:    /s/ Bill O'Daly
                                              ----------------------------------
                                              Name:  Bill O'Daly
                                              Title:  Vice President

<PAGE>

                                         DRESDNER BANK AG, GRAND CAYMAN BRANCH
                                         as a Lender

                                         By:    /s/ Thomas R. Brady
                                              ----------------------------------
                                              Name:  Thomas R. Brady
                                              Title:  Vice President

                                         By:    /s/ James M. Gallagher
                                              ----------------------------------
                                              Name:  James M. Gallagher
                                              Title:  Director

<PAGE>

                                         FIRSTAR BANK, N.A.,
                                         as a Lender

                                         By:    /s/ Alan R. Milster
                                              ----------------------------------
                                              Name:  Alan R. Milster
                                              Title:  Vice President

<PAGE>

                                         FIRST UNION NATIONAL BANK,
                                         as a Lender

                                         By:    /s/ John Kipping
                                              ----------------------------------
                                              Name:  John Kipping
                                              Title:  Senior Vice President

<PAGE>

                                         IIB BANK [IFSC BRANCH],
                                         as a Lender

                                         By:    /s/  S. Donlon
                                              ----------------------------------
                                              Name:
                                              Title:  Authorised Signatory

                                         By:    /s/ Brian Dunne
                                              ----------------------------------
                                              Name:  Brian Dunne
                                              Title:  Authorised Signatory

<PAGE>

                                         NATIONAL WESTMINSTER BANK PLC,
                                         New York and/or Nassau Branch
                                         as a Lender

                                         By:    /s/ Graeme Hunter
                                              ----------------------------------
                                              Name:  Graeme Hunter
                                              Title:  Vice President

<PAGE>

                                         ROYAL BANK OF SCOTLAND PLC,
                                         as a Lender

                                         By:    /s/ Graeme Hunter
                                              ----------------------------------
                                              Name: Graeme Hunter
                                              Title:  Vice President

<PAGE>

                                         SOCIETE GENERALE,
                                         as a Lender

                                         By:    /s/ Gordon R. Eadon
                                              ----------------------------------
                                              Name:  Gordon R. Eadon
                                              Title:  Director

<PAGE>

                                         SUNTRUST BANK,
                                         as a Lender

                                         By:    /s/ Maria Mamilovich
                                              ----------------------------------
                                              Name:  Maria Mamilovich
                                              Title:  Director

<PAGE>

                                         THE BANK OF NEW YORK,
                                         as a Lender

                                         By:    /s/ Peter W. Helt
                                              ----------------------------------
                                              Name:  Peter W. Helt
                                              Title:  Vice President

<PAGE>

                                         THE BANK OF NOVA SCOTIA,
                                         as a Lender

                                         By:    /s/ Christopher Usas
                                              ----------------------------------
                                              Name:  Christpher Usas
                                              Title:  Director

<PAGE>

                                         THE CHASE MANHATTAN BANK,
                                         as a Lender

                                         By:    /s/ Michael Lancia
                                              ----------------------------------
                                              Name:  Michael Lancia
                                              Title:  Vice President

<PAGE>

                                         UBS AG,
                                         as a Lender

                                         By:    /s/ Mark R. Slane
                                              ----------------------------------
                                              Name:  Mark R. Slane
                                              Title:  Executive Director

                                         By:    /s/ Kelly Smith
                                              ----------------------------------
                                              Name:  Kelly Smith
                                              Title:  Director
                                                      Recovery Management

<PAGE>

                                         WESTDEUTSCHE LANDESBANK GIROZENTRALE,
                                         as a Lender

                                         By:    /s/ Andreas Schroeter
                                              ----------------------------------
                                              Name:  Andreas Schroeter
                                              Title:  Director

                                         By:    /s/ Walter T. Duffy III
                                              ----------------------------------
                                              Name:  Walter T. Duffy III
                                              Title:  Associate Director

<PAGE>

                                                                      Schedule A

                                 OTHER BORROWERS

1.       Covanta Acquisition, Inc.
2.       Covanta Bessemer, Inc.
3.       Covanta Cunningham Environmental Support, Inc.
4.       Covanta Geothermal Operations Holdings, Inc.
5.       Covanta Imperial Power Services, Inc.
6.       Covanta Oahu Waste Energy Recovery, Inc.
7.       Covanta Energy Americas, Inc.
8.       Covanta Energy Construction, Inc.
9.       Covanta Energy Group, Inc.
10.      Covanta Energy Resource Corp.
11.      Covanta Energy Sao Jeronimo, Inc.
12.      Covanta Energy West, Inc.
13.      Covanta Energy International, Inc.
14.      Covanta Energy Services, Inc.
15.      Covanta Equity of Stanislaus, Inc.
16.      Covanta Financial Services, Inc.
17.      Covanta Geothermal Operations, Inc.
18.      Covanta Haverhill Properties, Inc.
19.      Covanta Hydro Energy, Inc.
20.      Covanta Hydro Operations West, Inc.
21.      Covanta Haverhill, Inc.
22.      Covanta Huntington Resource Recovery One Corp.
23.      Covanta Huntington Resource Recovery Seven Corp.
24.      Covanta Long Island, Inc.
25.      Covanta Oil & Gas, Inc.
26.      Covanta Omega Lease, Inc.
27.      Covanta Onondaga Five Corp.
28.      Covanta Onondaga Four Corp.
29.      Covanta Onondaga Three Corp.
30.      Covanta Onondaga Two Corp.
31.      Covanta Onondaga, Inc.
32.      Covanta Onondaga Operations, Inc.
33.      Covanta OPWH, Inc.
34.      Covanta Power Development, Inc.
35.      Covanta Power Development of Bolivia, Inc.
36.      Covanta Power Equity Corporation
37.      Covanta Power International Holdings, Inc.
38.      Covanta Projects, Inc.
39.      Covanta RRS Holdings Inc.
40.      Covanta SIGC Geothermal Operations, Inc.
41.      Covanta Stanislaus, Inc.
42.      Covanta Systems, Inc.
43.      Covanta Waste Solutions, Inc.
44.      Covanta Waste to Energy of Italy, Inc.
45.      Covanta Waste to Energy, Inc.
46.      Covanta Secure Services USA, Inc.
47.      Covanta Secure Services, Inc.
48.      Covanta Water Holdings, Inc.
49.      Covanta Water Systems, Inc.
50.      Covanta Water Treatment Services, Inc.
51.      DSS Environmental, Inc.
52.      Haverhill Power, Inc.
53.      Honolulu Resource Recovery Venture
54.      LMI, Inc.
55.      Michigan Waste Energy, Inc.
56.      New Martinsville Hydro-Operations Corporation
57.      OFS Equity of Alexandria/Arlington, Inc.
58.      OFS Equity of Babylon, Inc.
59.      OFS Equity of Delaware, Inc.
60.      OFS Equity of Huntington, Inc.
61.      OFS Equity of Indianapolis, Inc.
62.      OFS Equity of Stanislaus, Inc.
63.      Ogden Engineering Services, Inc.
64.      Ogden Environmental & Energy Services Co., Inc.
65.      Ogden Hydro Operations, Inc.
66.      Ogden Management Services, Inc.
67.      Ogden Marion Land Corp.
68.      Ogden Martin Operations of Union LLC
69.      Ogden Martin Systems of Alexandria/Arlington, Inc.
70.      Ogden Martin Systems of Bristol, Inc.
71.      Ogden Martin Systems of Fairfax, Inc.
72.      Ogden Martin Systems of Hillsborough, Inc.
73.      Ogden Martin Systems of Huntsville, Inc.
74.      Ogden Martin Systems of Kent, Inc.
75.      Ogden Martin Systems of Lancaster, Inc.
76.      Ogden Martin Systems of Lee, Inc.
77.      Ogden Martin Systems of Marion, Inc.
78.      Ogden Martin Systems of Montgomery, Inc.
79.      Ogden Martin Systems of Northwest Puerto Rico, Inc.
80.      Ogden Martin Systems of Pasco, Inc.
81.      Ogden Plant Services of New Jersey, Inc.
82.      Ogden Projects of Hawaii, Inc.
83.      Ogden Services Corp.
84.      Ogden Wallingford Associates, Inc.
85.      Ogden Water Systems of Key Largo, Inc.
86.      Ogden Water Systems of Tampa Bay, Inc.
87.      OMS Equity of Alexandria/Arlington, Inc.
88.      OPI Quezon Inc.
89.      OPW Associates, Inc.
90.      Resource Recovery Systems of Connecticut, Inc.
91.      Three Mountain Operations, Inc.

<PAGE>

                                                                      Schedule B
Datacom Custom Manufacturing, Inc.
Kansas City International Fueling Facilities Corporation LaGuardia Fuel
Facilities Corporation Lambert Field Fueling Facilities Corporation Lenzar
Electro-Optics, Inc.
Love Field Fueling Facilities Corporation
Newark Automotive Fuel Facilities Corporation
Ogden Allied Maintenance Corporation
Ogden Allied Maintenance Securities, Inc.
Ogden Allied Payroll Services, Inc.
Ogden Attractions, Inc.
Ogden Aviation Distributing Corporation
Ogden Aviation Fueling Company of Houston, Inc.
Ogden Aviation Fueling Company of St. Louis, Inc.
Ogden Aviation Fueling Company of Texas, Inc.
Ogden Aviation Fueling Company of Virginia, Inc.
Ogden Aviation Fueling Company, Inc.
Ogden Aviation Service Company of Colorado, Inc.
Ogden Aviation Service Company of Kansas City, Inc.
Ogden Aviation Service Company of New Jersey, Inc.
Ogden Aviation Service Company of New York, Inc.
Ogden Aviation Service Company of Pennsylvania, Inc.
Ogden Aviation Service International Corporation
Ogden Aviation Services of Puerto Rico, Inc.
Ogden Aviation Services, Inc.
Ogden Aviation, Inc.
Ogden Cargo Spain, Inc. (Delaware Corporation)
Ogden Central and South America, Inc.
Ogden Facility Holdings Incorporated
Ogden Film and Theatre, Inc.
Ogden Firehole Entertainment Corp.
Ogden International Europe, Inc.
Ogden New York Services, Inc.
Philadelphia Fuel Facilities Corporation
Ogden Film and Theater, Inc.

<PAGE>

                                                                      Schedule C
J.R. Jack's Construction Corporation
Ogden Constructors, Inc.
Covanta Huntington, Inc.

<PAGE>

                                                                         ANNEX A

                                ATTACHMENT NO. 1
                            TO COMPLIANCE CERTIFICATE

         This Attachment No. 1 is attached to and made a part of a
Compliance Certificate dated as of          ,    and pertains to the period
from          ,     to          ,   . Subsection references herein
relate to subsections of the Credit Agreement.

A. Indebtedness

  1. Indebtedness to fund Development Amounts of the type
     described in subsection 7.1(v):                             $
                                                                  -------------
  2. Maximum Development Amounts permitted under
     subsection 7.1(v):                                          $
                                                                  -------------
  3. Indebtedness of the type described in subsection 7.1(vii)
     incurred in connection with Investments of the type
     described in subsection 7.3(vii):                           $
                                                                  -------------

B. Investments

  1.  Investments of the type described in subsection 7.3(vii):  $
                                                                  -------------
  2.  Total Invested Amount of the type described in
      subsection 7.3(vii) (A.3+B.1+C.1):                         $
                                                                  -------------
  3.  Maximum Investment Amount permitted under
      subsection 7.3(vii):                                       $
                                                                  -------------
  4.  Investments to fund Development Amounts of the type
      described in subsection 7.3(xi):                           $
                                                                  -------------
  5.  Maximum Development Amounts permitted under
      subsection 7.3(xi):                                        $
                                                                  -------------

C. Contingent Obligations

  1. Contingent Obligations of the type described in
     subsection 7.4(vii) incurred in connection with
     Investments permitted under subsection 7.3(vii):            $
                                                                  -------------

D. Restricted Payments

  1. Restricted Payments of the type described in
     subsection 7.5(vii):                                        $
                                                                  -------------
  2. Maximum permitted under subsection 7.5(vii):                $ 55,000

E. Minimum Debt Service Coverage Ratio (for the four-Fiscal Quarter
   period ending          ,    )

  1. Consolidated Operating Income:                              $
                                                                  -------------
  2. Minority Interests:                                        ($             )
                                                                  -------------
  3. LOC Fees (to the extent deducted in E.1 and E.2):           $
                                                                  -------------
  4. FAS 84 Losses (to the extent deducted in E.1 and E.2):      $
                                                                  -------------
  5. Adjusted EBIT (E.1+E.2+E.3+E.4):                            $
                                                                  -------------
  6. Consolidated Debt Service Expense:                          $
                                                                  -------------
  7. Debt Service Coverage Ratio (E.5:E.6):                            :
                                                                  ----  ----
  8. Minimum ratio required under subsection 7.6A:                     :1.00
                                                                  ----

F. Maximum Leverage Ratio (as of        ,    )

  1. Indebtedness:                                               $
                                                                  -------------
  2. Cash and Cash Equivalents:                                  $
                                                                  -------------
  3. Convertible Subordinated Debentures and Limited
     Recourse Debt of Subsidiaries included in the calculation
     of F.1:                                                     $
                                                                  -------------
  4. Net Senior Recourse Indebtedness (1-2-3):                   $
                                                                  -------------
  5. Consolidated Leverage Ratio ((F.4:E.5)):                          :1.00
                                                                   ----
  6. Maximum ratio permitted under subsection 7.6B:                    :1.00
                                                                   ----
G. Minimum Consolidated Net Worth (as of          ,    )

  1. Consolidated Net Worth:                                     $
                                                                  -------------
  2. Minimum required under subsection 7.6C (actual
     Consolidated Net Worth at December 31, 2000 plus the sum of
     75% of positive Consolidated Net Income
     for each Fiscal Quarter after the Closing Date):            $
                                                                  -------------
H. Monthly Budget (for the period ending        ,      )

  1. Consolidated Maintenance Capital Expenditures:              $
                                                                  -------------
  2. "Cumulative Allowable Cash Usage Maintenance Capital
     Expenditures":                                              $
                                                                  -------------

  3. Expenditures in connection with the Anaheim Project:        $
                                                                  -------------
  4. Maximum Anaheim Expenditures permitted under
     subsection 7.8B:                                            $4,400,000

  5. Net Cash Usage:                                             $
                                                                  -------------
  6. "Cumulative Allowable Cash Usage":                          $
                                                                  -------------

  7. Additional Expenditures                                     $
                                                                  -------------

  8. Maximum Additional Expenditures permitted under
     subsection 7.8D                                             $1,000,000

I. Asset Sales

  1. Fair market value of Asset Sales as described in
     subsection 7.7(iv):                                         $
                                                                  -------------

  2. Maximum permitted under subsection 7.7(iv):                 $10,000,000

J. Leases

   1. Leases of the type described in subsection 7.10:           $
                                                                  ------------

   2. Maximum permitted under subsection 7.10:                   $3,000,000Exhibit 10.1(b)
                                                                 ---------------

                                SECOND AMENDMENT
                               TO REVOLVING CREDIT
                           AND PARTICIPATION AGREEMENT

     This SECOND AMENDMENT TO REVOLVING CREDIT AND PARTICIPATION AGREEMENT (this
"Amendment") is dated as of August 31, 2001 and entered into by and among
COVANTA ENERGY CORPORATION, a Delaware corporation ("Company"), and THE
SUBSIDIARIES LISTED ON THE SIGNATURE PAGES HEREOF AS BORROWERS (collectively,
Company and such Subsidiaries of Company are "Borrowers" and each a "Borrower"),
the Loan Parties listed on the signature pages hereof, the financial
institutions parties hereto (each a "Lender" and collectively, the "Lenders"),
BANK OF AMERICA, N.A., as Administrative Agent for the Lenders (the
"Administrative Agent"), and DEUTSCHE BANK AG, NEW YORK BRANCH, as Documentation
Agent for the Lenders ("Documentation Agent"), and is made with reference to
that certain Revolving Credit and Participation Agreement dated as of March 14,
2001 (as amended, restated, supplemented or otherwise modified as of the date
hereof, the "Credit Agreement"), by and among the Borrowers, the Lenders listed
therein as Lenders, Administrative Agent and Documentation Agent. Capitalized
terms used herein without definition shall have the same meanings herein as set
forth in the Credit Agreement.

                                    RECITALS

     WHEREAS, the Borrowers and Lenders desire to amend the Credit Agreement to
(i) replace the Monthly Budget with a revised Monthly Budget, (ii) permit
abandonment, bankruptcy, reorganization or liquidation of certain Subsidiaries,
(iii) permit Company to receive consideration other than cash with respect to
the sale of the Australian operations of Ogden IFC, (iv) permit Company to sell
accounts receivable with respect to Pacific Gas & Electric Company and its
subsidiaries and affiliates and Southern California Edison Corporation and its
subsidiaries and affiliates at a discount and (v) make certain other amendments
as set forth below;

     NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

Section 1. AMENDMENTS TO THE CREDIT AGREEMENT

1.1  Provisions Relating to Defined Terms

     New Definitions. Subsection 1.1 of the Credit Agreement is hereby amended
by (i) deleting the definition of "Monthly Budget", and (ii) inserting the
following new definitions in the appropriate alphabetical order:

          "Australian Investment" means the receipt by Ogden Entertainment
     Services (Asia Pacific) Pty Ltd. of preferred stock of Ogden International
     Facilities Corporation Pty Ltd ("Ogden IFC"), redeemable in the future, in
     an amount up to $2 million, out of 50% of Ogden IFC's after-tax profits, in
     consideration for the sale of its Australian venue management operations.

          "CGS" means Compania General de Sondeos CGS, S.A.

          "Datacom" means, collectively, Datacom Custom Manufacturing, Inc. and
     Datacom de Mexico, S.A. de C.V.

          "Equity Bonds" means those equity bonds set forth on Schedule 7.13
     annexed hereto.

          "Monthly Budget" means the cash usage budget delivered by Company to
     Lenders on or prior to the Closing Date, as amended, attached hereto as
     Schedule 1.1(e), setting forth, for each calendar month from the Closing
     Date through the Maturity Date, cash expenditures for Company and its
     Subsidiaries.

          "PG&E" means Pacific Gas & Electric Company and its Subsidiaries and
     affiliates.

          "Second Amendment" means that certain Second Amendment to Revolving
     Credit and Participation Agreement dated as of August 31, 2001 by and among
     the Borrowers, the Subsidiary Guarantors and the Lenders and Agents party
     thereto.

          "Second Amendment Effective Date" means the "Amendment Effective Date"
     as defined in the Second Amendment.

          "SoCal" means Southern California Edison Corporation and its
     Subsidiaries and affiliates.

1.2  Provision Relating to Revolving Loans

     Subsection 3.1A of the Credit Agreement is hereby amended by (i) deleting
the word "or" after clause (vi) thereof, (ii) deleting the "." at the end of
clause (vii) thereof and substituting therefor "; or" and (iii) adding the
following new clause (viii) at the end thereof:

          "(viii) any Letter of Credit without approval by (i) Revolving Lenders
     having or holding at the relevant time more than 60% of the aggregate
     Revolving Loan Exposure, and (ii) at least 8 Revolving Lenders, during the
     period from and after the Second Amendment Effective Date through and
     including the Maturity Date."

1.3  Provision Relating to Financial Statements and Other Reports

     Subsection 6.1 of the Credit Agreement is hereby amended by (i) deleting
the word "and" after clause (xix) thereof, (ii) deleting the "." at the end of
clause (xx) thereof and (iii) adding the following new clauses (xxi) and (xxii)
at the end thereof:

          "(xxi) Monthly Updates: after the Second Amendment Effective Date,
     within 20 days after the end of each month, a written update on credit
     reduction initiatives (including, without limitation, initiatives relating
     to the Convertible Subordinated Debentures, the Letters of Credit issued in
     connection with the Equity Bonds, Detroit Project and Anaheim Project) and
     other initiatives (including, without limitation, Asset Sales) and on such
     other matters as the Administrative Agent or Documentation Agent may
     reasonably request from time to time, and each such written update shall be
     in form and substance satisfactory to Administrative Agent and
     Documentation Agent; and

          (xxii) Rolling Thirteen-Week Cash Forecast; Cash Reports: after the
     Second Amendment Effective Date, as soon as available and in any event no
     later than October 20, 2001 and for each month thereafter, no later than
     the 5th and 20th day of such month (a) a consolidated cash forecast for
     Company and its Subsidiaries for the thirteen consecutive week period (each
     such forecast, a "13-Week Rolling Forecast") immediately following the 15th
     and 30th day (as applicable) of each month, in form reasonably satisfactory
     to Administrative Agent and Documentation Agent, setting forth projected
     cash receipts and cash expenditures for each such week with (1) individual
     line items corresponding to those in the Monthly Budget and (2) individual
     line items setting forth projected operational cash flows from the "WTE"
     business, the "IPP East" business and the "IPP West" business of Company
     and its Subsidiaries (including, with respect to each line item described
     in clause (1) or (2), separate projected amounts (where appropriate) of
     cash receipts and cash expenditures included in such line item); and (b) a
     report for the two-week period most recently ended (from the 1st through
     the 15th or the 16th through the 30th day (as applicable) of each month)
     setting forth (1) actual cash receipts and cash expenditures of Company and
     its Subsidiaries for each such week with respect to each line item
     described (or which would be described) in a 13-Week Rolling Forecast, (2)
     in each such report required to be delivered on or after November 5, 2001,
     the percentage and dollar variance of such amounts from the projected
     amounts therefor set forth in (x) the projections for the corresponding
     week contained in the first 13-Week Rolling Forecast delivered hereunder
     with respect to such week and (y) the projections for the corresponding
     week contained in the most recent 13-Week Rolling Forecast delivered
     hereunder with respect to such week, if materially different from the
     projections described in clause (x) (or if otherwise requested by either of
     the Agents), and (3) a narrative analysis of each such reported variance.
     It is understood and agreed that each report described in clause (b) of the
     preceding sentence, together with the 13-Week Rolling Forecast deliverable
     in connection therewith, shall be delivered by Company no later than (i)
     the 20th day of each month, for the two-week period ending on the 15th day
     of such month and (ii) the 5th day of each month, for the two-week period
     ending on the 30th day of the immediately preceding month."

1.4  Provision Relating to Indebtedness

     Subsection 7.1 of the Credit Agreement is hereby amended by (i) deleting
the word "and" after clause (ix) thereof, (ii) deleting the "." at the end of
clause (x) thereof and substituting therefor "; and" and (iii) adding the
following new clause (xi) at the end thereof:

          "(xi) After the Second Amendment Effective Date, Company and its
     Subsidiaries may, notwithstanding the provisions of subsection 7.13 and
     subsection 7.5, refinance the existing Equity Bonds; provided, however,
     that (a) the principal amount of such refinancing Indebtedness shall not
     exceed the principal amount of the Equity Bonds being refinanced (provided
     that the Equity Bonds with respect to Huntington and Babylon may be
     refinanced as separate series of bonds in a combined refinancing and the
     principal amount of each series shall not exceed the principal amount of
     the applicable Equity Bonds previously outstanding for those Facilities),
     (b) such refinancing Indebtedness shall have no scheduled installments of
     principal prior to the maturity thereof and no mandatory redemption
     requirements prior to five years from the Second Amendment Effective Date,
     and the final scheduled maturity thereof shall be no earlier than the final
     scheduled maturity of the Equity Bonds so refinanced (provided that the
     Equity Bonds with respect to Huntington and Babylon may be refinanced as
     separate series of bonds in a combined refinancing and the maturity date of
     each series shall not be earlier than the maturity date of the applicable
     Equity Bonds previously outstanding for those Facilities), (c) interest and
     fees accruing with respect to such refinancing Indebtedness shall not
     exceed 8% per annum, (d) no collateral security, other than Company's
     guaranty of payment, shall be provided by Company or any of its
     Subsidiaries to any Person in connection with such refinancing
     Indebtedness, (e) no Person shall have any recourse to Company or any
     Subsidiary of Company pursuant to any Contingent Obligation supporting such
     refinancing Indebtedness, other than a guaranty by Company of the payment
     thereof described in clause (d), (f) none of Company nor any of its
     Subsidiaries shall be obligated under any circumstances to obtain or cause
     the issuance of a letter of credit or similar instrument to support such
     refinancing Indebtedness, (g) the applicable documentation for such
     refinancing Indebtedness shall contain covenants no less favorable to the
     relevant obligors than those contained in the 9.25% Debenture Indenture
     (provided that covenants similar to those set forth in Sections 9.3, 9.8
     and 9.9 of the 9.25% Debenture Indenture shall not be contained in the
     applicable documentation for such refinancing Indebtedness), (h) the
     applicable documentation for such refinancing Indebtedness shall contain
     events of default no less favorable to the relevant obligors than those
     contained in the 9.25% Debenture Indenture and (i) Company and its
     Subsidiaries shall apply, or cause to be applied, immediately after
     receipt, all proceeds of such refinancing Indebtedness to repay any drawing
     under any Pooled Letter of Credit supporting payment of the applicable
     Equity Bonds."

1.5  Provision Relating to Investment Spending

     Subsection 7.3 of the Credit Agreement is hereby amended by (i) deleting
the word "and" after clause (xiv) thereof, (ii) deleting the "." at the end of
clause (xv) thereof and substituting therefor "; and", and (iii) adding the
following new clause (xvi) immediately prior to the last paragraph of such
subsection:

          "(xvi) after the Second Amendment Effective Date, Company and its
     Subsidiaries may make the Australian Investment and own the preferred stock
     acquired thereby, so long as the sale of Company's and its Subsidiaries'
     Australian venue management operations is consummated in accordance with
     the terms of this Agreement."

1.6  Provision Relating to Contingent Obligations; Performance Guaranties.

     Subsection 7.4 of the Credit Agreement is hereby amended by (i) deleting
the word "and" after clause (viii) thereof, (ii) deleting the "." at the end of
clause (ix) thereof and substituting therefor "; and" and (iii) adding the
following new clause (x) at the end thereof:

          "(x) after the Second Amendment Effective Date, Company may become and
     remain liable with respect to Contingent Obligations consisting of
     guaranties of Indebtedness incurred to refinance the Equity Bonds to the
     extent such Indebtedness is permitted by subsection 7.1(xi)."

1.7  Provision Relating to Restricted Payments

     Subsection 7.5(vii) of the Credit Agreement is hereby amended by deleting
the reference to "$55,000" therein and substituting therefor "$72,000".

1.8  Provision Relating to Asset Sales

     A. Subsection 7.7(vii). Subsection 7.7(vii)(b) of the Credit Agreement is
hereby amended by inserting the words "and the Australian Investment" following
the words "with exception to the Aviation Note," in the beginning thereof.

     B. Subsection 7.7. Subsection 7.7 of the Credit Agreement is hereby amended
by (i) deleting the word "and" after clause (x) thereof, (ii) deleting the "."
at the end of clause (xi) and (iii) adding the following new clauses (xii) and
(xiii) at the end thereof:

          "(xii) after the Second Amendment Effective Date, Company and any of
     its Subsidiaries may abandon, liquidate or cause bankruptcy, reorganization
     or similar filing to be made with respect to all or any part of the
     business of CGS; provided, however, that such liquidation shall not give
     rise to (a) any breach or default under any of the Financing Documents or
     any other Indebtedness of Company or any of its Subsidiaries, or (b) any
     contractual recourse obligations or recourse obligations arising as a
     matter of law to Company or any of its Subsidiaries other than CGS; and

          (xiii) Company may sell or dispose of up to $77,600,000 face amount of
     accounts receivable owed by PG&E and/or accounts receivable owed by SoCal
     to Company and its Subsidiaries (collectively, the "Accounts Receivable")
     following a process reasonably designed to maximize value; provided,
     however that the sole consideration received for such Accounts Receivable
     shall be cash and no such Accounts Receivable shall be sold by Company or
     any Subsidiary to any buyer at a discount of greater than 30% of the face
     value of such Accounts Receivable."

1.9  Provision Relating to Monthly Budget Covenants

     A. Subsection 7.8C. Subsection 7.8C of the Credit Agreement is hereby
amended by adding the following at the end thereof:

          "Notwithstanding anything in subsection 7.3(vii) or elsewhere in this
     Agreement to the contrary, Borrowers shall not, and shall not permit their
     respective Subsidiaries to, make any cash expenditures, directly or
     indirectly create, incur or assume any commitments to make any cash
     expenditures or directly or indirectly create, incur or assume any
     Contingent Obligations, the amount of which would in accordance with past
     practice be classified as "IPP Unidentified Investments-Direct Investment"
     set forth in the Monthly Budget, during the period from and after the
     Second Amendment Effective Date to and including the Maturity Date."

     B. Subsection 7.8E. Subsection 7.8 of the Credit Agreement is hereby
amended by adding the following subsection E at the end thereof:

          "E. Datacom and CGS Expenditures. Borrowers shall not, and shall not
     permit their respective Subsidiaries to make cash expenditures after the
     Second Amendment Effective Date (i) in connection with Datacom or its
     operations in excess of an aggregate amount of $200,000, provided, however,
     that Datacom itself may make such cash expenditures in excess of $200,000
     so long as such expenditures are otherwise not prohibited under this
     Agreement; or (ii) in connection with CGS or its operations in excess of an
     aggregate amount of $200,000, provided, however that CGS itself may make
     such cash expenditures in excess of $200,000 so long as such expenditures
     are otherwise not prohibited under this Agreement, provided, further that
     Borrowers may make cash expenditures in connection with CGS or its
     operations in excess of $200,000 so long as such expenditures are permitted
     pursuant to subsection 7.8D of the Credit Agreement."

1.10 Provisions Relating to Bankruptcy

     Subsections 8.6 and 8.7 of the Credit Agreement are hereby amended by
adding the words "(other than CGS so long as Company is in compliance with
subsection 7.7(xii))", following the words "Company or any of its Subsidiaries"
wherever they appear.

1.11 Provisions Relating to the Exhibits and Schedules

     A. Schedule 1.1(e). Schedule 1.1(e) to the Credit Agreement is hereby
deleted in its entirety and replaced with the revised Schedule 1.1(e) attached
hereto as Annex A.

     B. Schedule 7.13. The Credit Agreement is hereby amended by adding a new
Schedule 7.13, attached hereto as Annex B.

     C. Compliance Certificate. Attachment No. 1 to Exhibit V to the Credit
Agreement is hereby amended by deleting the reference to "$55,000" in section
D.2. thereof and substituting therefor "$72,000".

Section 2. BORROWER'S REPRESENTATIONS AND WARRANTIES

     In order to induce the Lenders to enter into this Amendment and to amend
the Credit Agreement in the manner provided herein, the Borrowers represent and
warrant to each Lender that the following statements are true, correct and
complete:

     A. Corporate Power and Authority. Each Loan Party has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, the Credit
Agreement as amended by this Amendment (the "Amended Agreement").

     B. Authorization of Agreements. The execution and delivery of this
Amendment has been duly authorized by all necessary corporate action on the part
of each Loan Party and the performance of the Amended Agreement has been duly
authorized by all necessary corporate action on the part of each Borrower.

     C. No Conflict. The execution and delivery by each Loan Party of this
Amendment and the performance by each Borrower of the Amended Agreement do not
and will not (i) violate any provision of any law or any governmental rule or
regulation applicable to any Loan Party or any of its Subsidiaries, or the
Certificate or Articles of Incorporation or Certificate of Formation or Bylaws
or Operating Agreement of any Loan Party or any of its Subsidiaries or any
order, judgment or decree of any court or other agency of government binding on
any Loan Party or any of its Subsidiaries, (ii) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a default
under any indenture, mortgage, deed of trust, credit agreement or loan
agreement, or any other material agreement, contract or instrument to which any
Loan Party or any of its Subsidiaries is a party or by which it or any of its
property or assets is bound or to which it may be subject (each such indenture,
mortgage, deed of trust, credit agreement, loan agreement, material agreement,
contract or instrument, a "Contractual Obligation"), (iii) result in or require
the creation or imposition of any Lien upon any of the properties or assets of
any Loan Party or any of its Subsidiaries (other than Liens created under any of
the Loan Documents in favor of Administrative Agent or Collateral Agent on
behalf of the Banks), or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of any Loan
Party or any of its Subsidiaries.

     D. Governmental Consents. The execution and delivery by each Loan Party of
this Amendment and the performance by each Borrower of the Amended Agreement do
not and will not require any registration with, consent or approval of, or
notice to, or other action to, with or by, any federal, state or other
governmental authority or regulatory body.

     E. Binding Obligation. This Amendment has been duly executed and delivered
by each Loan Party and this Amendment and the Amended Agreement is the legally
valid and binding obligations of each Loan Party enforceable against each Loan
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.

     F. Incorporation of Representations and Warranties From Credit Agreement.
The representations and warranties contained in Section 5 of the Credit
Agreement are and will be true, correct and complete in all material respects on
and as of the Amendment Effective Date (as hereinafter defined) to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case they were true, correct and complete in all material respects on and as of
such earlier date.

     G. Absence of Default. As of the date hereof after giving effect hereto,
there exists no Default or Event of Default under the Credit Agreement.

Section 3. ACKNOWLEDGEMENT AND CONSENT

     Each Borrower and Subsidiary Guarantor hereby acknowledges that such Loan
Party has read this Amendment and consents to the terms hereof and further
hereby confirms and agrees that, notwithstanding the effectiveness of this
Amendment, the obligations of such Loan Party under each of the Loan Documents
to which such Loan Party is a party shall not be impaired and each of the Loan
Documents to which such Loan Party is a party are, and shall continue to be, in
full force and effect and are hereby confirmed and ratified in all respects.

Section 4. MISCELLANEOUS

     A. Covenant Relating to Financial Advisor.

     On or prior to October 19, 2001, Company shall select and retain, on scope
and terms reasonably acceptable to Administrative Agent and Documentation Agent,
an advisor (reasonably acceptable to Administrative Agent and Documentation
Agent) with respect to matters relating to the financial restructuring of
Company and its Subsidiaries.

     B. Covenant Relating to Datacom.

     Company shall notify Administrative Agent and Documentation Agent in
writing on or before September 26, 2001 of its intention to pursue the
abandonment, liquidation or filing for bankruptcy, reorganization or other
similar filing or the sale of all or any part of the business of Datacom.

     C. Covenant Relating to Foreign Cash

     As soon as available and in any event within 30 days of the Second
Amendment Effective Date, Company shall provide to Administrative Agent and
Documentation Agent a written analysis, in form and substance satisfactory to
Administrative Agent and Documentation Agent, with respect to (i) cash
maintained in foreign jurisdictions by Company and its Subsidiaries, identifying
the amount thereof, the jurisdictions in which (and the institutions and
accounts in which) such cash is located and any valid and enforceable
contractual restrictions or local laws prohibiting the repatriation of such cash
(to the extent consents allowing such repatriation have not been obtained), and
(ii) any other matters relating to such cash that Administrative Agent or
Documentation Agent may request.

     D. Reference to and Effect on the Credit Agreement and the Other Loan
Documents.

     (i) On and after the Amendment Effective Date, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like
import referring to the Credit Agreement, and each reference in the other Loan
Documents to the "Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement shall mean and be a reference to the
Amended Agreement.

     (ii) Except as specifically amended by this Amendment, the Credit Agreement
and the other Loan Documents shall remain in full force and effect and are
hereby ratified and confirmed.

     (iii) The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any provision of, or
operate as a waiver of any right, power or remedy of any Agent or any Lender
under, the Credit Agreement or any of the other Loan Documents.

     (iv) (iv) Company agrees that any failure to comply with the covenants in
this Amendment shall be an Event of Default under the Credit Agreement.

     E. Fees and Expenses. Each Borrower acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Administrative Agent, Documentation Agent or the Lenders and their respective
counsel (including, without limitation, O'Melveny & Myers LLP and Ernst & Young
Corporate Finance LLC) with respect to this Amendment and the documents and
transactions contemplated hereby shall be for the account of the Borrowers.

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

     G. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL 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.

     H. Counterparts; Effectiveness. This Amendment may be executed in any
number of 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. This Amendment shall become effective upon (i) the execution
of a counterpart hereof by each Borrower, each Subsidiary Guarantor and the
Lenders constituting Requisite Lenders, (ii) receipt by each Borrower,
Administrative Agent and Documentation Agent of written or telephonic
notification of such execution and authorization of delivery thereof, (iii) the
payment to Administrative Agent, for distribution to each Pooled Facility Lender
and each Revolving Lender that has in either case executed and delivered this
Amendment on or prior to 5:00 p.m. (New York City time) on September 26, 2001,
in proportion to such Lender's Pro Rata Share, an amendment fee in an aggregate
amount equal to .125% of the sum of the total Pooled Facility Exposure of all
Pooled Facility Lenders plus the sum of the total Revolving Loan Exposure of all
Revolving Lenders, each such credit exposure to be calculated as of such date,
and (iv) the payment to Administrative Agent, for distribution to each Opt-Out
Lender that has in either case executed and delivered this Amendment on or prior
to 5:00 p.m. (New York City time) on September 26, 2001, in proportion to the
ratio of such Opt-Out Lender's Opt-Out Facility Exposure to the sum of the total
Opt-Out Facility Exposure of all Opt-Out Lenders, an amendment fee in an
aggregate amount equal to .125% of the sum of the total Opt-Out Facility
Exposures of all Opt-Out Lenders, each such Opt-Out Facility Exposure to be
calculated as of such date(the date of satisfaction of such conditions being
referred to herein as the "Amendment Effective Date").

               [Remainder of this page intentionally left blank.]

<PAGE>

                                                                Second Amendment

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

                  BORROWERS:

                                         COVANTA ENERGY CORPORATION

                                         By:    /s/ Jeffrey R. Horowitz
                                             -----------------------------------
                                              Name:  Jeffrey R. Horowitz
                                              Title:  Authorized Officer

                                         Each of the entities named on Schedule
                                         A annexed hereto, as Borrowers

                                         By:    /s/ Jeffrey R. Horowitz
                                             -----------------------------------
                                              Name:
                                              Title:

                                         Each of the entities named on Schedule
                                         B annexed hereto, as Subsidiary
                                         Guarantors

                                         By:    /s/ Peter Allen
                                             -----------------------------------
                                              Name:
                                              Title:

                                         Each of the entities named on Schedule
                                         C annexed hereto, as Subsidiary
                                         Guarantors

                                         By:    /s/ Jeffrey R. Horowitz
                                             -----------------------------------
                                              Name:
                                              Title:

<PAGE>

AGENTS AND LENDERS:

                                         BANK OF AMERICA, N.A.,
                                         as Administrative Agent, Co-Arranger,
                                         Co-Book Runner and as a Lender

                                         By:  /s/ Michael R. Heredia
                                             -----------------------------------
                                              Name:  Michael R. Heredia
                                              Title:  Managing Director

<PAGE>

                                         DEUTSCHE BANK AG, NEW YORK BRANCH
                                         As Documentation Agent, Co-Arranger,
                                         Co-Book Runner And As A Lender

                                         By:  /s/ Keith C. Braun
                                             -----------------------------------
                                              Name:  Keith C. Braun
                                              Title:  Vice President

                                         By:  /s/ David Mayhew
                                             -----------------------------------
                                              Name:  David Mayhew
                                              Title:  Vice President

<PAGE>

                                         ABN AMRO BANK N.V.,
                                         as a lender

                                         By:  /s/ Judith M. Bresnen
                                             -----------------------------------
                                              Name:  Judith M. Bresnen
                                              Title:  Group Vice President

                                         By:  /s/ John M. Pastore
                                             -----------------------------------
                                              Name:  John M. Pastore
                                              Title:  Assistant Vice President

<PAGE>

                                         BANK OF MONTREAL,
                                         as a lender

                                         By:  /s/ Heather L. Turf
                                             -----------------------------------
                                              Name:  Heather L. Turf
                                              Title:  Director

<PAGE>

                                         BAYERISCHE HYPO-UND VEREINSBANK AG,
                                         as a lender

                                         By:  /s/  Salvatore Esposito
                                             -----------------------------------
                                              Name:  Salvatore Esposito
                                              Title:  Director

                                         By:  /s/ Michael Novellino
                                             -----------------------------------
                                              Name:  Michael Novellino
                                              Title:  Associate Director

<PAGE>

                                         CANADIAN IMPERIAL BANK OF COMMERCE,
                                         as a Lender

                                         By:  /s/ D.C. Smith
                                             -----------------------------------
                                              Name:  D.C. Smith
                                              Title:  Managing Director

                                         By:  /s/ Sandra M. Seaton Banks
                                             -----------------------------------
                                              Name:  Sandra M. Seaton Banks
                                              Title:  Senior Manager

<PAGE>

                                         CLARICA LIFE INSURANCE COMPANY,
                                         as a Lender

                                         By:  /s/ Sara Alvarado
                                             -----------------------------------
                                             Name:  Sara Alvarado
                                             Title: Director, Structural Finance

<PAGE>

                                         CREDIT LYONNAIS CANADA,
                                         as a Lender

                                         By:    /s/ J.S. Brydon
                                             -----------------------------------
                                              Name:  J.S. Brydon
                                              Title:  Senior Manager

                                         By:    /s/ Allan Jenkins
                                             -----------------------------------
                                              Name:  Allan Jenkins
                                              Title:  Assistant Vice President

<PAGE>

                                         CREDIT LYONNAIS NEW YORK BRANCH,
                                         as a Lender

                                         By:    /s/ James B. Hallock
                                             -----------------------------------
                                              Name:  James B. Hallock
                                              Title:  Vice President

<PAGE>

                                         CREDIT SUISSE FIRST BOSTON,
                                         as a Lender

                                         By:    /s/ Kristin Lepri
                                             -----------------------------------
                                              Name:  Kristin Lepri
                                              Title:  Assistant Vice President

                                         By:    /s/ Bill O'Daly
                                             -----------------------------------
                                              Name:  Bill O'Daly
                                              Title:  Vice President

<PAGE>

                                         DRESDNER BANK AG, GRAND CAYMAN BRANCH
                                         as a Lnder

                                         By:    /s/ Thomas R. Brady
                                             -----------------------------------
                                              Name:  Thomas R. Brady
                                              Title:  Vice President

                                         By:    /s/ Matthew Sawyer
                                             -----------------------------------
                                              Name:  Matthew Sawyer
                                              Title:  Assistant Treasurer

<PAGE>

                                         FLEET NATIONAL BANK,
                                         as a Lender

                                         By:    /s/ Michael F. O'Neill S.V.P.
                                             -----------------------------------
                                              Name:  Michael F. O'Neill
                                              Title:  Senior Vice President

<PAGE>

                                         HSBC BANK CANADA,
                                         as a Lender

                                         By:    /s/ J.S. Brydon
                                             -----------------------------------
                                              Name:  J.S. Brydon
                                              Title:  Senior Manager

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

<PAGE>

                                         HSBC BANK USA,
                                         as a Lender

                                         By:    /s/ Carol A. Kraus
                                             -----------------------------------
                                              Name:  Carol A. Kraus
                                              Title:  HSBC Bank USA
                                                      Vice President

<PAGE>

                                         IIB BANK [IFSC BRANCH],
                                         as a Lender

                                         By:    /s/ Stephen Lynch
                                             -----------------------------------
                                              Name:  Stephen Lynch
                                              Title:  Head of Credit

                                         By:    /s/ John Reynolds
                                             -----------------------------------
                                              Name:  John Reynolds
                                              Title:  Executive Director

<PAGE>

                                         NATIONAL WESTMINSTER BANK PLC, New York
                                         and/or Nassau Branch
                                         as a Lender

                                         By:    /s/ Graeme Hunter
                                             -----------------------------------
                                              Name:  Graeme Hunter
                                              Title:  Vice President

<PAGE>

                                         ROYAL BANK OF SCOTLAND PLC,
                                         as a Lender

                                         By:    /s/ Graeme Hunter
                                             -----------------------------------
                                              Name: Graeme Hunter
                                              Title:  Vice President

<PAGE>

                                         SANPAOLO IMI S.p.A.,
                                         as a Lender

                                         By:    /s/ Robert Wurster
                                             -----------------------------------
                                              Name:  Robert Wurster
                                              Title:  Senior Vice President

                                         By:    /s/ Ettdre Viazzo
                                             -----------------------------------
                                              Name:  Ettdre Viazzo
                                              Title:  Vice President

<PAGE>

                                         THE BANK OF NEW YORK,
                                         as a Lender

                                         By:    /s/ Peter W. Helt
                                             -----------------------------------
                                              Name:  Peter W. Helt
                                              Title:  Vice President

<PAGE>

                                         THE BANK OF NOVA SCOTIA,
                                         as a Lender

                                         By:    /s/ Joseph J. Farricielli
                                             -----------------------------------
                                              Name:  Joseph J. Farricielli
                                              Title:  Director

<PAGE>

                                         THE CHASE MANHATTAN BANK,
                                         as a Lender

                                         By:    /s/ Michael Lancia
                                             -----------------------------------
                                              Name:  Michael Lancia
                                              Title:  Vice President

<PAGE>

                                         THE DAI-ICHI KANGYO BANK, LIMITED,
                                         Los Angeles Agency
                                         as a Lender

                                         By:    /s/ Yoshimitsu Arahata
                                             -----------------------------------
                                              Name:  Yoshimitsu Arahata
                                              Title:  Senior Vice President &
                                                      Joint General Manager

<PAGE>

                                         THE HUNTINGTON NATIONAL BANK,
                                         as a Lender

                                         By:    /s/ David F. Isler
                                             -----------------------------------
                                              Name:  David F. Isler
                                              Title:  Senior Vice President

<PAGE>

                                        THE SANWA BANK, LIMITED, NEW YORK BRANCH
                                        as a Lender

                                        By:    /s/ Joseph E. Leo
                                            -----------------------------------
                                            Name:  Joseph E. Leo
                                            Title: Vice President & Area Manager

<PAGE>

                                         SUMITOMO MITSUI BANKING CORPORATION
                                         OF CANADA,
                                         as a Lender

                                         By:    /s/ Alfred Lee
                                             -----------------------------------
                                              Name:  Alfred Lee
                                              Title:  Vice President

<PAGE>

                                         THE TOKAI BANK, LIMITED - NEW YORK
                                         BRANCH,
                                         as a Lender

                                         By:    /s/ Shinichi Nakatani
                                             -----------------------------------
                                              Name:  Shinichi Nakatani
                                              Title:  Deputy General Manager

<PAGE>

                                         THE TORONTO-DOMINION BANK,
                                         as a Lender

                                         By:    /s/ Mark A. Baird
                                             -----------------------------------
                                              Name:  Mark A. Baird
                                              Title:  MGR. CR ADMIN.

<PAGE>

                                         THE TORONTO-DOMINION BANK,
                                         as a Lender

                                         By:    /s/ Liliana Godina
                                             -----------------------------------
                                              Name:  Liliana Godina
                                              Title:  Vice President

<PAGE>

                                         UBS AG,
                                         as a Lender

                                         By:    /s/ Kelly Smith
                                             -----------------------------------
                                              Name:  Kelly Smith
                                              Title:  Director
                                                      Recovery Management

                                         By:    /s/ William A. Roche
                                             -----------------------------------
                                              Name:  William A. Roche
                                              Title:  Executive Director
                                                      Recovery Management

<PAGE>

                                         U.S. BANK NATIONAL ASSOCIATION
                                         (formerly known as Firstar Bank, N.A.)
                                         as a Lender

                                         By:    /s/ Alan R. Milster
                                             -----------------------------------
                                              Name:  Alan R. Milster, Vice
                                                     President

<PAGE>

                                         WESTDEUTSCHE LANDESBANK GIROZENTRALE,
                                         as a Lender

                                         By:    /s/ Alan S. Bookspan
                                             -----------------------------------
                                              Name:  Alan S. Bookspan
                                              Title:  Director

                                         By:    /s/ Walter T. Duffy III
                                             -----------------------------------
                                              Name:  Walter T. Duffy III
                                              Title:  Associate Director

<PAGE>

                                                                      Schedule A

OTHER BORROWERS
1.       Covanta Acquisition, Inc.
2.       Covanta Bessemer, Inc.
3.       Covanta Cunningham Environmental Support, Inc.
4.       Covanta Geothermal Operations Holdings, Inc.
5.       Covanta Imperial Power Services, Inc.
6.       Covanta Oahu Waste Energy Recovery, Inc.
7.       Covanta Energy Americas, Inc.
8.       Covanta Energy Construction, Inc.
9.       Covanta Energy Group, Inc.
10.      Covanta Energy Resource Corp.
11.      Covanta Energy Sao Jeronimo, Inc.
12.      Covanta Energy West, Inc.
13.      Covanta Energy International, Inc.
14.      Covanta Energy Services, Inc.
15.      Covanta Equity of Stanislaus, Inc.
16.      Covanta Financial Services, Inc.
17.      Covanta Geothermal Operations, Inc.
18.      Covanta Haverhill Properties, Inc.
19.      Covanta Hydro Energy, Inc.
20.      Covanta Hydro Operations West, Inc.
21.      Covanta Haverhill, Inc.
22.      Covanta Huntington Resource Recovery One Corp.
23.      Covanta Huntington Resource Recovery Seven Corp.
24.      Covanta Long Island, Inc.
25.      Covanta Oil & Gas, Inc.
26.      Covanta Omega Lease, Inc.
27.      Covanta Onondaga Five Corp.
28.      Covanta Onondaga Four Corp.
29.      Covanta Onondaga Three Corp.
30.      Covanta Onondaga Two Corp.
31.      Covanta Onondaga, Inc.
32.      Covanta Onondaga Operations, Inc.
33.      Covanta OPWH, Inc.
34.      Covanta Power Development, Inc.
35.      Covanta Power Development of Bolivia, Inc.
36.      Covanta Power Equity Corporation
37.      Covanta Power International Holdings, Inc.
38.      Covanta Projects, Inc.
39.      Covanta RRS Holdings Inc.
40.      Covanta SIGC Geothermal Operations, Inc.
41.      Covanta Stanislaus, Inc.
42.      Covanta Systems, Inc.
43.      Covanta Waste Solutions, Inc.
44.      Covanta Waste to Energy of Italy, Inc.
45.      Covanta Waste to Energy, Inc.
46.      Covanta Secure Services USA, Inc.
47.      Covanta Secure Services, Inc.
48.      Covanta Water Holdings, Inc.
49.      Covanta Water Systems, Inc.
50.      Covanta Water Treatment Services, Inc.
51.      DSS Environmental, Inc.
52.      Haverhill Power, Inc.
53.      Honolulu Resource Recovery Venture
54.      LMI, Inc.
55.      Michigan Waste Energy, Inc.
56.      New Martinsville Hydro-Operations Corporation
57.      OFS Equity of Alexandria/Arlington, Inc.
58.      OFS Equity of Babylon, Inc.
59.      OFS Equity of Delaware, Inc.
60.      OFS Equity of Huntington, Inc.
61.      OFS Equity of Indianapolis, Inc.
62.      OFS Equity of Stanislaus, Inc.
63.      Ogden Engineering Services, Inc.
64.      Ogden Environmental & Energy Services Co., Inc.
65.      Ogden Hydro Operations, Inc.
66.      Ogden Management Services, Inc.
67.      Ogden Marion Land Corp.
68.      Ogden Martin Operations of Union LLC
69.      Ogden Martin Systems of Alexandria/Arlington, Inc.
70.      Ogden Martin Systems of Bristol, Inc.
71.      Ogden Martin Systems of Fairfax, Inc.
72.      Ogden Martin Systems of Hillsborough, Inc.
73.      Ogden Martin Systems of Huntsville, Inc.
74.      Ogden Martin Systems of Kent, Inc.
75.      Ogden Martin Systems of Lancaster, Inc.
76.      Ogden Martin Systems of Lee, Inc.
77.      Ogden Martin Systems of Marion, Inc.
78.      Ogden Martin Systems of Montgomery, Inc.
79.      Ogden Martin Systems of Northwest Puerto Rico, Inc.
80.      Ogden Martin Systems of Pasco, Inc.
81.      Ogden Plant Services of New Jersey, Inc.
82.      Ogden Projects of Hawaii, Inc.
83.      Ogden Services Corp.
84.      Ogden Wallingford Associates, Inc.
85.      Ogden Water Systems of Key Largo, Inc.
86.      Ogden Water Systems of Tampa Bay, Inc.
87.      OMS Equity of Alexandria/Arlington, Inc.
88.      OPI Quezon Inc.
89.      OPW Associates, Inc.
90.      Resource Recovery Systems of Connecticut, Inc.
91.      Three Mountain Operations, Inc.

<PAGE>

                                                                      Schedule B
Datacom Custom Manufacturing, Inc.
Kansas City International Fueling Facilities Corporation LaGuardia Fuel
Facilities Corporation Lambert Field Fueling Facilities Corporation Lenzar
Electro-Optics, Inc.
Love Field Fueling Facilities Corporation
Newark Automotive Fuel Facilities Corporation
Ogden Allied Maintenance Corporation
Ogden Allied Maintenance Securities, Inc.
Ogden Allied Payroll Services, Inc.
Ogden Attractions, Inc.
Ogden Aviation Distributing Corporation
Ogden Aviation Fueling Company of Houston, Inc.
Ogden Aviation Fueling Company of St. Louis, Inc.
Ogden Aviation Fueling Company of Texas, Inc.
Ogden Aviation Fueling Company of Virginia, Inc.
Ogden Aviation Fueling Company, Inc.
Ogden Aviation Service Company of Colorado, Inc.
Ogden Aviation Service Company of Kansas City, Inc.
Ogden Aviation Service Company of New Jersey, Inc.
Ogden Aviation Service Company of New York, Inc.
Ogden Aviation Service Company of Pennsylvania, Inc.
Ogden Aviation Service International Corporation
Ogden Aviation Services of Puerto Rico, Inc.
Ogden Aviation Services, Inc.
Ogden Aviation, Inc.
Ogden Cargo Spain, Inc. (Delaware Corporation)
Ogden Central and South America, Inc.
Ogden Facility Holdings Incorporated
Ogden Film and Theatre, Inc.
Ogden Firehole Entertainment Corp.
Ogden International Europe, Inc.
Ogden New York Services, Inc.
Philadelphia Fuel Facilities Corporation
Ogden Film and Theater, Inc.

<PAGE>

                                                                      Schedule C
J.R. Jack's Construction Corporation
Ogden Constructors, Inc.
Covanta Huntington, Inc.

<PAGE>

                                                                         ANNEX A

<PAGE>

                                                                         ANNEX B

                                  Schedule 7.13

                            Equity Bonds Outstanding

-----------------------------------------------------------------------
Project Name                                    Par Amount
------------                                    ----------
-----------------------------------------------------------------------
Babylon                                         $27,800,000
-----------------------------------------------------------------------
Huntington                                      $31,100,000
-----------------------------------------------------------------------
Alexandria                                      $14,250,000
-----------------------------------------------------------------------
Indianapolis                                    $33,060,000
-----------------------------------------------------------------------
Stanislaus                                      $18,545,000
-----------------------------------------------------------------------

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