ASSIGNMENT AND CONSENT TO ASSIGNMENT OF
                              INVESTMENT AGREEMENT


         ASSIGNMENT AND CONSENT TO ASSIGNMENT OF INVESTMENT AGREEMENT, dated May
7, 1999 (this  "Assignment  and  Consent"),  by and among  Samstock,  L.L.C.,  a
Delaware limited liability company ("Samstock"),  Danielson Holding Corporation,
a Delaware  corporation  (the "Company"),  Martin J. Whitman  ("Whitman") and SZ
Investments,  L.L.C., a Delaware limited liability  company ("SZ"),  relating to
the Investment  Agreement (the  "Investment  Agreement"),  dated as of April 14,
1998, by and among Samstock,  Whitman and the Company. All capitalized terms not
otherwise  defined  herein  shall  have the  meanings  given  such  terms in the
Investment Agreement.

         WHEREAS, Samstock is controlled by SZ, its sole limited liability
company member;

         WHEREAS,  Samstock desires to assign to SZ (the  "Assignment"),  and SZ
desires to assume from Samstock (the  "Assumption"),  all of Samstock's  rights,
duties, obligations and interest arising under the Investment Agreement; and

         WHEREAS,  the  Company  desires to consent  to the  Assignment  and the
Assumption pursuant to Section 3.10 of the Investment Agreement.

         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
promises herein made, and other good and valuable  consideration the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

         1. Assignment and Assumption.  Samstock hereby assigns to SZ all of its
rights, obligations, duties, liabilities and interests arising under or relating
to the  Investment  Agreement,  and  SZ  hereby  accepts  this  Assignment  from
Samstock.  Samstock  shall be released  from,  and SZ shall assume as its direct
obligations as if SZ were the original  party to the  Investment  Agreement with
the  Company  and  Whitman,  all  of  Samstock's  rights,  obligations,  duties,
liabilities and interests arising under or relating to the Investment Agreement,
and agrees to perform and discharge all of Samstock's  obligations,  duties, and
liabilities  thereunder.  The Assignment and Assumption shall be effective as of
the date hereof.

         2. Consent to Assignment and Assumption.  The Company hereby  consents,
pursuant to Section 3.10 of the  Investment  Agreement,  to the  Assignment  and
Assumption as provided in the  foregoing  paragraph and agrees that wherever the
term "Samstock" appears in the Investment Agreement,  it shall be deemed to read
and refer to SZ. The Company hereby fully, finally and forever waives,  releases
and  discharges  Samstock  from any and all claims,  causes of action,  demands,
suits,  costs,  liabilities,

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debts,  expenses  (including  but not  limited  to reasonable  attorneys'  fees)
and  damages,  that it now may have,  ever had, or hereafter may acquire of
whatsoever  nature and kind,  whether known or unknown, whether  now  existing
or  hereafter  arising,  whether at law or in equity,  in contract,  tort or
otherwise,  by statute  or common  law,  arising  out of the Investment
Agreement.

         3.       Miscellaneous.

                  (a) Counterparts.  This Assignment and Consent may be executed
in one or more counterparts,  each of which shall be deemed an original but both
of which together will constitute one and the same instrument.

                  (b)  Headings.   The  section   headings   contained  in  this
Assignment and Consent are inserted for convenience only and shall not affect in
any way the meaning or interpretation of this Assignment and Consent.

                  (c) Governing Law; Jurisdiction;  Process. This Assignment and
Consent shall be governed by and construed in accordance  with the internal laws
(and not the laws of conflicts) of the State of Delaware.

                  (d) Parties in Interest.  This Assignment and Consent shall be
binding upon and inure to the benefit of the parties hereto and their respective
legal representatives, successors and assigns.



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         IN WITNESS  WHEREOF,  the parties hereto have executed this  Assignment
and Consent to  Assignment  of  Investment  Agreement as of the date first above
written.

                                  SAMSTOCK, L.L.C.



                                   By:  Donald J. Liebentritt
                                        _______________________________
                                        Name: Donald J. Liebentritt
                                        Title: Vice President


                                   SZ INVESTMENTS, L.L.C.



                                   By:  Donald J. Liebentritt
                                        _______________________________
                                        Name: Donald J. Liebentritt
                                        Title: Vice President


                                   DANIELSON HOLDING CORPORATION



                                   By:  David Barse
                                        _______________________________
                                        Name: David Barse
                                        Title: President and
                                        Chief Operating Officer


                                        Martin J. Whitman
                                        _______________________________
                                        MARTIN J. WHITMAN



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