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   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
   &lt;div align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent"&gt;
       &lt;b&gt;&lt;font style="font-family: 'Times New Roman', Times"&gt;NOTE&amp;#160;3.
       ACQUISITIONS AND BUSINESS DEVELOPMENT&lt;/font&gt;&lt;/b&gt;
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       Our growth strategy includes the acquisition of waste and energy
       related businesses located in markets with significant growth
       opportunities and the development of new projects and expansion
       of existing projects. We will also consider acquiring or
       developing new technologies and businesses that are
       complementary with our existing renewable energy and waste
       services business. The results of operations reflect the period
       of ownership of the acquired businesses and business development
       projects. The acquisitions in the section below are not material
       to our condensed consolidated financial statements individually
       or in the aggregate and therefore, disclosures of pro forma
       financial information have not been presented.
   &lt;/div&gt;
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       &lt;b&gt;&lt;font style="font-family: 'Times New Roman', Times"&gt;Acquisitions
       and Business Development&lt;/font&gt;&lt;/b&gt;
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
   &lt;div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 1%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent"&gt;
       &lt;i&gt;&lt;u&gt;Fairfax County Energy-from-Waste Facility&lt;/u&gt;&lt;/i&gt;
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
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       In August 2010, the service fee contract with Fairfax County was
       extended from 2011 to 2016 pursuant to a unilateral option held
       by the County. The terms of the contract remain unchanged under
       the extension; however, the project debt on the facility was
       repaid in February 2011, and since Fairfax County had previously
       paid debt service as a component of the service fee during the
       term of the original contract, the County will effectively
       retain the benefit of the debt repayment during the 5&amp;#160;year
       extension period. In March&amp;#160;2011, the county announced its
       desire to proceed to negotiate a long-term extension to the
       contract rather than exercise a fair market value purchase
       option it holds under the existing agreement. The parties are
       currently working to complete the contract extension.
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
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       &lt;i&gt;&lt;u&gt;Huntington Energy-from-Waste Facility&lt;/u&gt;&lt;/i&gt;
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
   &lt;div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 1%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent"&gt;
       In March 2010, we acquired a nominal limited partnership
       interest held by a third party in Covanta Huntington Limited
       Partnership, our subsidiary which owns and operates an
       energy-from-waste facility in Huntington, New York, for cash
       consideration of $2.0&amp;#160;million.
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
   &lt;div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 1%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent"&gt;
       &lt;i&gt;&lt;u&gt;Dade Energy-from-Waste Business&lt;/u&gt;&lt;/i&gt;
   &lt;/div&gt;
   &lt;div style="margin-top: 6pt; font-size: 1pt"&gt;&amp;#160;
   &lt;/div&gt;
   &lt;div align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 1%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent"&gt;
       In February 2010, we completed a transaction with Veolia
       Environmental Services North America Corp. in which we paid cash
       consideration of $128.3&amp;#160;million for an energy-from-waste
       business located in Florida. The operation acquired included a
       long-term operating contract with the respective municipal
       client.
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 -Publisher FASB
 -Name Statement of Financial Accounting Standard (FAS)
 -Number 141
 -Paragraph 51, 52

Reference 2: http://www.xbrl.org/2003/role/presentationRef
 -Publisher FASB
 -Name Emerging Issues Task Force (EITF)
 -Number 88-16

Reference 3: http://www.xbrl.org/2003/role/presentationRef
 -Publisher FASB
 -Name Statement of Financial Accounting Standard (FAS)
 -Number 141R
 -Paragraph 67-73

Reference 4: http://www.xbrl.org/2003/role/presentationRef
 -Publisher FASB
 -Name Statement of Financial Accounting Standard (FAS)
 -Number 141R
 -Paragraph F4
 -Subparagraph e
 -Appendix F

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