EXHIBIT 10.1

Execution Version

 
 
 
 
 

Cleco Power LLC

$100,000,000

5.12% Senior Notes due December 16, 2041

______________

Note Purchase Agreement

______________

Dated December 16, 2011

 
 
 
 
 

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Table of Contents
SECTION
HEADING
PAGE
 
 
 
SECTION 1.
AUTHORIZATION OF NOTES
1

 
 
 
SECTION 2.
SALE AND PURCHASE OF NOTES
1

 
 
 
SECTION 3.
CLOSING
1

 
 
 
SECTION 4.
CONDITIONS TO CLOSING
2

 
 
 
SECTION 4.1.Representations and Warranties
2

SECTION 4.2.Performance; No Default
2

SECTION 4.3.Compliance Certificates
2

SECTION 4.4.Opinions of Counsel
2

SECTION 4.5.Purchase Permitted By Applicable Law, Etc
3

SECTION 4.6.Sale of Other Notes
3

SECTION 4.7.Payment of Special Counsel Fees
3

SECTIO 4.8.Private Placement Number
3

SECTION 4.9.Changes in Corporate Structure
3

SECTION 4.10.Funding Instructions
3

SECTION 4.11.Regulatory Order
4

SECTION 4.12.Proceedings and Documents
4

 
 
 
SECTION 5.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
4

 
 
 
SECTION 5.1.Organization; Power and Authority
4

SECTION 5.2.Authorization, Etc
4

SECTION 5.3.Disclosure
4

SECTION 5.4.Organization and Ownership of Shares of Subsidiaries; Affiliates
5

SECTION 5.5.Financial Statements; Material Liabilities
6

SECTION 5.6.Compliance with Laws, Other Instruments, Etc
6

SECTION 5.7.Governmental Authorizations, Etc
6

SECTION 5.8.Litigation; Observance of Agreements, Statutes and Orders
6

SECTION 5.9.Taxes
7

SECTION 5.10.Title to Property; Leases
7

SECTION 5.11.Licenses, Permits, Etc
7

SECTION 5.12.Compliance with ERISA
7

SECTION 5.13.Private Offering by the Company
8

SECTION 5.14.Use of Proceeds; Margin Regulations
8

SECTION 5.15.Existing Indebtedness; Future Liens
9

SECTION 5.16.Foreign Assets Control Regulations, Etc
9

SECTION 5.17.Status under Certain Statutes
10

SECTION 5.18.Environmental Matters
10

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SECTION 6.
REPRESENTATIONS OF THE PURCHASERS
11

 
 
SECTION 6.1.Purchase for Investment
11

SECTION 6.2.Source of Funds
11

 
 
 
SECTION 7.
INFORMATION AS TO COMPANY
13

 
 
 
SECTION 7.1.Financial and Business Information
13

SECTION 7.2.Officer's Certificate
15

SECTION 7.3.Visitation
16

 
 
 
SECTION 8.
PAYMENT AND PREPAYMENT OF THE NOTES
17

 
 
 
SECTION 8.1.Maturity
17

SECTION 8.2.Optional Prepayments with Make-Whole Amount
17

SECTION 8.3.Allocation of Partial Prepayments
17

SECTION 8.4.Maturity; Surrender, Etc
17

SECTION 8.5.Purchase of Notes
17

SECTION 8.6.Make-Whole Amount
18

 
 
 
SECTION 9.
AFFIRMATIVE COVENANTS
19

 
 
 
SECTION 9.1.Compliance with Law
19

SECTION 9.2.Insurance
20

SECTION 9.3.Maintenance of Properties
20

SECTION 9.4.Payment of Taxes and Claims
20

SECTION 9.5.Corporate Existence, Etc
20

SECTION 9.6.Books and Records
20

 
 
 
SECTION 10.
NEGATIVE COVENANTS
21

 
 
 
SECTION 10.1.Transactions with Affiliates
21

SECTION 10.2.Merger, Consolidation, Etc
21

SECTION 10.3.Line of Business
22

SECTION 10.4.Terrorism Sanctions Regulations
22

SECTION 10.5.Liens
22

SECTION 10.6.Subsidiary Indebtedness
24

SECTION 10.7.Leverage Ratio
25

 
 
 
SECTION 11.
EVENTS OF DEFAULT
25

 
 
 
SECTION 12.
REMEDIES ON DEFAULT, ETC
27

 
 
 
SECTION 12.1.Acceleration
27

SECTION 12.2.Other Remedies
28

SECTION 12.3.Rescission
28

SECTION 12.4.No Waivers or Election of Remedies, Expenses, Etc
29

 
 
 
SECTION 13.
REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES
29

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SECTION 13.1.Registration of Notes
29

SECTION 13.2.Transfer and Exchange of Notes
29

SECTION 13.3.Replacement of Notes
30

 
 
SECTION 14.
PAYMENTS ON NOTES
30

 
 
 
SECTION 14.1.Place of Payment
30

SECTION 14.2.Home Office Payment
30

 
 
SECTION 15.
EXPENSES, ETC
31

 
 
 
SECTION 15.1.Transaction Expenses
31

SECTION 15.2.Survival
31

 
 
 
SECTION 16.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT
31

 
 
 
SECTION 17.
AMENDMENT AND WAIVER
32

 
 
 
SECTION 17.1.Requirements
32

SECTION 17.2.Solicitation of Holders of Notes
32

SECTION 17.3.Binding Effect, etc
33

SECTION 17.4.Notes Held by Company, etc
33

 
 
 
SECTION 18.
NOTICES
33

 
 
 
SECTION 19.
REPRODUCTION OF DOCUMENTS
33

 
 
 
SECTION 20.
CONFIDENTIAL INFORMATION
34

 
 
 
SECTION 21.
SUBSTITUTION OF PURCHASER
35

 
 
 
SECTION 22.
MISCELLANEOUS
35

 
 
 
SECTION 22.1.Successors and Assigns
35

SECTION22.2.Payments Due on Non-Business Days
35

SECTION 22.3.Accounting Terms
35

SECTION 22.4.Severability
36

SECTION 22.5.Construction, etc
36

SECTION 22.6.Counterparts
36

SECTION 22.7.Governing Law
36

SECTION 22.8.Jurisdiction and Process; Waiver of Jury Trial
36

 
 
 
SIGNATURE
 
1

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Cleco Power LLC
2030 Donahue Ferry Road
Pineville, Louisiana 71360 5226

5.12% Senior Notes due December 16, 2041

December 16, 2011

TO EACH OF THE PURCHASERS LISTED IN
SCHEDULE A HERETO:
Ladies and Gentlemen:
Cleco Power LLC, a Louisiana limited liability company (the “Company”), agrees
with each of the purchasers whose names appear at the end hereof (each, a
“Purchaser” and, collectively, the “Purchasers”) as follows:
Section 1.
AUTHORIZATION OF NOTES.

The Company will authorize the issue and sale of $100,000,000 aggregate
principal amount of its 5.12% Senior Notes due December 16, 2041 (the “Notes”,
such term to include any such notes issued in substitution therefor pursuant to
Section 13). The Notes shall be substantially in the form set out in Exhibit 1.
Certain capitalized and other terms used in this Agreement are defined in
Schedule B; and references to a “Schedule” or an “Exhibit” are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.
Section 2.
SALE AND PURCHASE OF NOTES.

Subject to the terms and conditions of this Agreement, the Company will issue
and sell to each Purchaser and each Purchaser will purchase from the Company, at
the Closing provided for in Section 3, Notes in the principal amount specified
opposite such Purchaser's name in Schedule A at the purchase price of 100% of
the principal amount thereof. The Purchasers' obligations hereunder are several
and not joint obligations and no Purchaser shall have any liability to any
Person for the performance or non-performance of any obligation by any other
Purchaser hereunder.
Section 3.
CLOSING.

The sale and purchase of the Notes to be purchased by each Purchaser shall occur
at the offices of Chapman and Cutler LLP, 111 West Monroe Street, Chicago,
Illinois 60603 at 10:00 a.m. Central time, at a closing (the “Closing”) on
December 16, 2011 or on such other Business

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Cleco Power LLC
 
Note Purchase Agreement

Day thereafter on or prior to December 20, 2011 as may be agreed upon by the
Company and the Purchasers. At the Closing the Company will deliver to each
Purchaser the Notes to be purchased by such Purchaser in the form of a single
Note (or such greater number of Notes in denominations of at least $100,000 as
such Purchaser may request) dated the date of the Closing and registered in such
Purchaser's name (or in the name of its nominee), against delivery by such
Purchaser to the Company or its order of immediately available funds in the
amount of the purchase price therefor by wire transfer of immediately available
funds for the account of the Company to account number 5737400 at JPMorgan Chase
Bank, N.A., 1 Chase Manhattan Plaza, New York, NY 10005-1401, ABA number
021000021. If at the Closing the Company shall fail to tender such Notes to any
Purchaser as provided above in this Section 3, or any of the conditions
specified in Section 4 shall not have been fulfilled to such Purchaser's
satisfaction, such Purchaser shall, at its election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights such
Purchaser may have by reason of such failure or such nonfulfillment.
Section 4.
CONDITIONS TO CLOSING.

Each Purchaser's obligation to purchase and pay for the Notes to be sold to such
Purchaser at the Closing is subject to the fulfillment to such Purchaser's
satisfaction, prior to or at the Closing, of the following conditions:
Section 4.1.    Representations and Warranties. The representations and
warranties of the Company in this Agreement shall be correct when made at the
time of the Closing.
Section 4.2.    Performance; No Default. The Company shall have performed and
complied with all agreements and conditions contained in this Agreement required
to be performed or complied with by it prior to or at the Closing and after
giving effect to the issue and sale of the Notes (and the application of the
proceeds thereof as contemplated by Section 5.14) no Default or Event of Default
shall have occurred and be continuing. Neither the Company nor any Subsidiary
shall have entered into any transaction since the date of the Memorandum that
would have been prohibited by Sections 10.1 through 10.3, inclusive, Section
10.5 and Section 10.6 had such Sections applied since such date.
Section 4.3.    Compliance Certificates.
(a)    Officer's Certificate. The Company shall have delivered to such Purchaser
an Officer's Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
(b)    Secretary's Certificate. The Company shall have delivered to such
Purchaser a certificate of its Secretary or Assistant Secretary, dated the date
of Closing, certifying as to the resolutions attached thereto and other limited
liability company proceedings relating to the authorization, execution and
delivery of the Notes and this Agreement.
Section 4.4.    Opinions of Counsel. Such Purchaser shall have received opinions
in form and substance satisfactory to such Purchaser, dated the date of the
Closing (a) from (i)

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Baker Botts L.L.P., New York special counsel for the Company and (ii) Phelps
Dunbar, L.L.P., Louisiana special counsel for the Company, covering the matters
set forth in Exhibit 4.4(a) and covering such other matters incident to the
transactions contemplated hereby as such Purchaser or its counsel may reasonably
request (and the Company hereby instructs each such counsel to deliver its
opinion to the Purchasers) and (b) from Chapman and Cutler, the Purchasers'
special counsel in connection with such transactions, substantially in the form
set forth in Exhibit 4.4(b) and covering such other matters incident to such
transactions as such Purchaser may reasonably request.
Section 4.5.    Purchase Permitted By Applicable Law, Etc. On the date of the
Closing such Purchaser's purchase of Notes shall (a) be permitted by the laws
and regulations of each jurisdiction to which such Purchaser is subject, without
recourse to provisions (such as section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject such
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation, which law or regulation was not in effect on the date hereof.
If requested by such Purchaser, such Purchaser shall have received an Officer's
Certificate certifying as to such matters of fact as such Purchaser may
reasonably specify to enable such Purchaser to determine whether such purchase
is so permitted.
Section 4.6.    Sale of Other Notes. Contemporaneously with the Closing the
Company shall sell to each other Purchaser and each other Purchaser shall
purchase the Notes to be purchased by it at the Closing as specified in
Schedule A.
Section 4.7.    Payment of Special Counsel Fees. Without limiting the provisions
of Section 15.1, the Company shall have paid on or before the Closing the fees,
charges and disbursements of the Purchasers' special counsel referred to in
Section 4.4 to the extent reflected in a statement of such counsel rendered to
the Company at least one Business Day prior to the Closing.
Section 4.8.    Private Placement Number. A Private Placement Number issued by
Standard & Poor's CUSIP Service Bureau (in cooperation with the SVO) shall have
been obtained for the Notes.
Section 4.9.    Changes in Limited Liability Company Structure. The Company
shall not have changed its jurisdiction of organization or been a party to any
merger or consolidation or succeeded to all or any substantial part of the
liabilities of any other entity, at any time following the date of the most
recent financial statements referred to in Schedule 5.5.
Section 4.10.    Funding Instructions. At least three Business Days prior to the
date of the Closing, each Purchaser shall have received written instructions
signed by a Responsible Officer on letterhead of the Company confirming the
information specified in Section 3 including (i) the name and address of the
transferee bank, (ii) such transferee bank's ABA number and (iii) the account
name and number into which the purchase price for the Notes is to be deposited.

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Section 4.11.    Regulatory Order. A no-opposition letter from the Louisiana
Public Service Commission (the “LPSC Order”) relating to the issuance of the
Notes shall have been received by the Company and copies thereof shall have been
furnished to the Purchasers.
Section 4.12.    Proceedings and Documents. All limited liability company and
other proceedings in connection with the transactions contemplated by this
Agreement and all documents and instruments incident to such transactions shall
be satisfactory to such Purchaser and its special counsel, and such Purchaser
and its special counsel shall have received all such counterpart originals or
certified or other copies of such documents as such Purchaser or such special
counsel may reasonably request.
Section 5.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to each Purchaser that:
Section 5.1.    Organization; Power and Authority. The Company is a limited
liability company duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified as a foreign
limited liability company and is in good standing in each jurisdiction in which
such qualification is required by law, other than those jurisdictions as to
which the failure to be so qualified or in good standing could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
The Company has the limited liability company power and authority to own or hold
under lease the properties it purports to own or hold under lease, to transact
the business it transacts and proposes to transact, to execute and deliver this
Agreement and the Notes and to perform the provisions hereof and thereof.
Section 5.2.    Authorization, Etc. This Agreement and the Notes have been duly
au-thorized by all necessary limited liability company action on the part of the
Company, and this Agreement constitutes, and upon execution and delivery thereof
each Note will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Section 5.3.    Disclosure. The Company, through its agents, Crédit Agricole
Securities (USA) Inc., JPMorgan Securities Inc. and KeyBanc Capital Markets
Inc., has delivered to each Purchaser a copy of a Confidential Private Placement
Memorandum, dated November 30, 2011 (together with all exhibits thereto and all
other documents incorporated therein by reference (copies of which have been
delivered to the Purchasers), the “Memorandum”), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects,
the general nature of the business and principal properties of the Company and
its Subsidiaries. This Agreement, the Memorandum and the documents, certificates
or other writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and identified in
Schedule 5.3, and the financial statements listed in Schedule 5.5 (this
Agreement, the Memorandum and such documents, certificates or other writings and
such

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financial statements delivered to each Purchaser prior to December 2, 2011 being
referred to, collectively, as the “Disclosure Documents”), taken as a whole, do
not contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading in light
of the circumstances under which they were made, provided that, to the extent
any such reports, financial statements, certificates or other information was
based upon or constitutes a forecast or a projection (including statements
concerning future financial performance, ongoing business strategies or
prospects or possible future actions, and other forward-looking statements), the
Company represents only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time. Except as disclosed in
the Disclosure Documents, since December 31, 2010, there has been no change in
the financial condition, operations, business, properties or prospects of the
Company or any Subsidiary except changes that individually or in the aggregate
could not reasonably be expected to have a Material Adverse Effect. There is no
fact known to the Company that could reasonably be expected to have a Material
Adverse Effect that has not been set forth herein or in the Disclosure
Documents.
Section 5.4.    Organization and Ownership of Shares of Subsidiaries;
Affiliates. (a) Schedule 5.4 contains (except as noted therein) complete and
correct lists (i) of the Company's Subsidiaries, showing, as to each Subsidiary,
the correct name thereof, the jurisdiction of its organization, and the
percentage of shares of each class of its capital stock or similar equity
interests outstanding owned by the Company and each other Subsidiary, (ii) of
the Company's Affiliates, other than Subsidiaries, and (iii) of the Company's
directors and senior officers.
(b)    All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c)    Each Subsidiary identified in Schedule 5.4 is a corporation or other
legal entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.
(d)    Other than Cleco Katrina/Rita Hurricane Recovery Funding LLC, no
Subsidiary is a party to, or otherwise subject to any legal, regulatory,
contractual or other restriction (other than this Agreement, the agreements
listed on Schedule 5.4 and customary limitations imposed by corporate law or
similar statutes) restricting the ability of such Subsidiary to pay dividends
out of profits or make any other similar distributions of profits to the Company
or any of its Subsidiaries that owns outstanding shares of capital stock or
similar equity interests of such Subsidiary.

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Section 5.5.    Financial Statements; Material Liabilities. The Company has
delivered to each Purchaser copies of the financial statements of the Company
and its Subsidiaries listed on Schedule 5.5. All of said financial statements
(including in each case the related schedules and notes) fairly present in all
material respects the consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared in accordance with GAAP consistently
applied throughout the periods involved except as set forth in the notes thereto
(subject, in the case of any interim financial statements, to normal year-end
adjustments). The Company and its Subsidiaries do not have any Material
liabilities that are not disclosed on such financial statements or otherwise
disclosed in the Disclosure Documents.
Section 5.6.    Compliance with Laws, Other Instruments, Etc. The execution,
delivery and performance by the Company of this Agreement and the Notes will not
(i) contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of the Company or
any Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, corporate or limited liability company charter, by-laws
or limited liability company agreement, or any other agreement or instrument to
which the Company or any Subsidiary is bound or by which the Company or any
Subsidiary or any of their respective properties may be bound or affected,
(ii) conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Subsidiary (assuming the
accuracy of the Purchasers' representations set forth in Section 6) or
(iii) violate any provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company or any Subsidiary.
Section 5.7.    Governmental Authorizations, Etc. Other than the LSPC Order, no
consent, approval or authorization of, or registration, filing or declaration
with, any Governmental Authority is required to be obtained or made by the
Company or any Subsidiary thereof in connection with the execution, delivery or
performance by the Company of this Agreement or the Notes, other than routine
filings with the LPSC and the SEC. The LPSC Order is in full force and effect
and is final, and all periods for appeal and rehearing by third parties have
expired and all conditions contained in the LSPC Order which are required to be
fulfilled on or prior to the issuance of the Notes have been fulfilled.
Section 5.8.    Litigation; Observance of Agreements, Statutes and Orders.
(a) There are no actions, suits, investigations or proceedings pending or, to
the knowledge of the Company, threatened against or affecting the Company or any
Subsidiary or any property of the Company or any Subsidiary in any court or
before any arbitrator of any kind or before or by any Governmental Authority
that, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(b)    Neither the Company nor any Subsidiary is in default under any term of
any agreement or instrument to which it is a party or by which it is bound, or
any order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws

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or the USA Patriot Act) of any Governmental Authority, which default or
violation, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.
Section 5.9.    Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (i) the amount
of which is not individually or in the aggregate Material or (ii) the amount,
applicability or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which the Company or a Subsidiary,
as the case may be, has established adequate reserves in accordance with GAAP.
The Company knows of no basis for any other tax or assessment that could
reasonably be expected to have a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company and its Subsidiaries in respect of
Federal, state or other taxes for all fiscal periods are adequate. The Federal
income tax liabilities of the Company and its Subsidiaries have been finally
determined (whether by reason of completed audits or the statute of limitations
having run) for all fiscal years up to and including the fiscal year ended
December 31, 2000.
Section 5.10.    Title to Property; Leases. The Company and its Subsidiaries
have good and sufficient title to their respective properties that individually
or in the aggregate are Material, including all such properties reflected in the
most recent audited balance sheet referred to in Section 5.5 or purported to
have been acquired by the Company or any Subsidiary after said date (except as
sold or otherwise disposed of in the ordinary course of business), in each case
free and clear of Liens prohibited by this Agreement. All leases that
individually or in the aggregate are Material are valid and subsisting and are
in full force and effect in all material respects.
Section 5.11.    Licenses, Permits, Etc. (a) The Company and its Subsidiaries
own or possess all licenses, permits, franchises, authorizations, patents,
copyrights, proprietary software, service marks, trademarks and trade names, or
rights thereto, that individually or in the aggregate are Material, without
known conflict with the rights of others.
(b)    To the best knowledge of the Company, no product of the Company or any of
its Subsidiaries infringes in any material respect any license, permit,
franchise, authorization, patent, copyright, proprietary software, service mark,
trademark, trade name or other right owned by any other Person.
(c)    To the best knowledge of the Company, there is no Material violation by
any Person of any right of the Company or any of its Subsidiaries with respect
to any patent, copyright, proprietary software, service mark, trademark, trade
name or other right owned or used by the Company or any of its Subsidiaries.
Section 5.12.    Compliance with ERISA. (a) The Company and each ERISA Affiliate
have operated and administered each Plan in compliance with all applicable laws
except for such instances of noncom-pliance as have not resulted in and could
not reasonably be expected to result in a Material Adverse Effect. Neither the
Company nor any ERISA Affiliate has incurred

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any liability pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans (as defined in
section 3 of ERISA), and no event, transaction or condition has occurred or
exists that could reasonably be expected to result in the incurrence of any such
liability by the Company or any ERISA Affiliate, or in the imposition of any
Lien on any of the rights, properties or assets of the Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to such penalty
or excise tax provisions or to section 401(a)(29) or 412 of the Code or section
4068 of ERISA, other than such liabilities or Liens as would not be individually
or in the aggregate Material.
(b)    The present value of the aggregate benefit liabilities under each of the
Plans (other than Multiemployer Plans), determined as of the end of such Plan's
most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities by a Material amount. The term “benefit
liabilities” has the meaning specified in section 4001 of ERISA and the terms
“current value” and “present value” have the meaning specified in section 3 of
ERISA.
(c)    The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d)    The expected postretirement benefit obligation (determined as of the last
day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material.
(e)    The execution and delivery of this Agreement and the issuance and sale of
the Notes hereunder will not involve any transaction that is subject to the
prohibitions of section 406 of ERISA or in connection with which a tax could be
imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation by
the Company to each Purchaser in the first sentence of this Section 5.12(e) is
made in reliance upon and subject to the accuracy of such Purchaser's
representation in Section 6.2 as to the sources of the funds used to pay the
purchase price of the Notes to be purchased by such Purchaser.
Section 5.13.    Private Offering by the Company. Neither the Company nor anyone
acting on its behalf has offered the Notes or any similar securities for sale
to, or solicited any offer to buy any of the same from, or otherwise approached
or negotiated in respect thereof with, any person other than the Purchasers and
not more than 15 other Institutional Investors, each of which has been offered
the Notes at a private sale for investment. Neither the Company nor anyone
acting on its behalf has taken, or will take, any action that would subject the
issuance or sale of the Notes to the registration requirements of Section 5 of
the Securities Act or to the registration requirements of any securities or blue
sky laws of any applicable jurisdiction.
Section 5.14.    Use of Proceeds; Margin Regulations. The Company will apply the
proceeds of the sale of the Notes as set forth in “The Offering and Use of
Proceeds” of the Memorandum. No part of the proceeds from the sale of the Notes
hereunder will be used,

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directly or indirectly, for the purpose of buying or carrying any margin stock
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading
in any securities under such circumstances as to involve the Company in a
violation of Regulation X of said Board (12 CFR 224) or to involve any broker or
dealer in a violation of Regulation T of said Board (12 CFR 220). Margin stock
does not constitute more than 5% of the value of the consolidated assets of the
Company and its Subsidiaries and the Company does not have any present intention
that margin stock will constitute more than 5% of the value of such assets. As
used in this Section, the terms “margin stock” and “purpose of buying or
carrying” shall have the meanings assigned to them in said Regulation U.
Section 5.15.    Existing Indebtedness; Future Liens. (a) Except as described
therein, Schedule 5.15 sets forth a complete and correct list of all outstanding
Indebtedness of the Company and its Subsidiaries as of November 30, 2011
(including a description of the obligors and obligees, principal amount
outstanding and collateral therefor, if any, and Guaranty thereof, if any),
since which date there has been no Material change in the amounts, interest
rates, sinking funds, installment payments or maturities of the Indebtedness of
the Company or its Subsidiaries. Neither the Company nor any Subsidiary is in
default and no waiver of default is currently in effect, in the payment of any
principal or interest on any Indebtedness of the Company or such Subsidiary and
no event or condition exists with respect to any Indebtedness of the Company or
any Subsidiary that would permit (or that with notice or the lapse of time, or
both, would permit) one or more Persons to cause such Indebtedness to become due
and payable before its stated maturity or before its regularly scheduled dates
of payment.
(b)    Except as disclosed in Schedule 5.15, neither the Company nor any
Subsidiary has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien not permitted by Section 10.5.
(c)    Neither the Company nor any Subsidiary is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness of
the Company or such Subsidiary, any agreement relating thereto or any other
agreement (including, but not limited to, its charter or other organizational
document) which limits the amount of, or otherwise imposes restrictions on the
incurring of, Indebtedness of the Company, except as specifically indicated in
Schedule 5.15.
Section 5.16.    Foreign Assets Control Regulations, Etc. (a) Neither the
Company nor any Controlled Entity (i) is a Person whose name appears on the list
of Specially Designated Nationals and Blocked Persons published by the Office of
Foreign Assets Control, U.S. Department of Treasury (“OFAC”) (an “OFAC Listed
Person”) or is a Person that is otherwise subject to an OFAC Sanctions Program,
(ii) is a department, agency or instrumentality of, or is otherwise controlled
by or acting on behalf of, directly or indirectly, (x) any OFAC Listed Person or
(y) any Person, entity, organization, foreign country or regime that is subject
to any OFAC Sanctions Program (each OFAC Listed Person and each other Person,
entity, organization and government of a country described in clause (ii), a
“Blocked Person”) or (iii) has any investments in, or engages in any dealings or
transactions with, any Blocked Person.

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(b)    No part of the proceeds from the sale of the Notes hereunder constitutes
or will constitute funds obtained on behalf of any Blocked Person or will
otherwise be used, directly by the Company or indirectly through any Controlled
Entity, in connection with any investment in, or any transactions or dealings
with, any Blocked Person.
(c)    To the Company's knowledge after making due inquiry, neither the Company
nor any Controlled Entity (i) is under investigation by any Governmental
Authority for, or has been charged with, or convicted of, money laundering, drug
trafficking, terrorist‑related activities or other money laundering predicate
crimes under any applicable law (collectively, “Anti‑Money Laundering Laws”),
(ii) has been assessed civil penalties under any Anti‑Money Laundering Laws or
(iii) has had any of its funds seized or forfeited in an action under any
Anti‑Money Laundering Laws. The Company has taken reasonable measures
appropriate to the circumstances (in any event as required by applicable law) to
ensure that the Company and each Affiliated Entity is and will continue to be in
compliance with all applicable current and future Anti‑Money Laundering Laws.
(d)    No part of the proceeds from the sale of the Notes hereunder will be
used, directly or indirectly, for any improper payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, official of any public international organization or any
one else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage. The Company has taken reasonable
measures appropriate to the circumstances (in any event as required by
applicable law) to ensure that the Company and each Controlled Entity is and
will continue to be in compliance with all applicable current and future
anti‑corruption laws and regulations.
Section 5.17.    Status under Certain Statutes. Neither the Company nor any
Subsidiary is subject to regulation under the Investment Company Act of 1940, as
amended, the Public Utility Holding Company Act of 2005, as amended, the ICC
Termination Act of 1995, as amended, or the Federal Power Act, as amended.
Section 5.18.    Environmental Matters. Except as disclosed in the following
Company filings with the SEC (i) Annual Report on Form 10-K for the fiscal year
ended December 31, 2010 (see Part 1, Item 1, “Business - Regulatory Matters,
Industry Developments, and Franchises - Environmental Matters”); (ii) Quarterly
Report on Form 10-Q for the quarterly period ended March 31, 2011 (see Part 1,
Item 2, “Management's Discussion and Analysis of Financial Condition and Results
of Operations - Financial Condition - Regulatory Matters - Environmental
Matters”); (iii) Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2011 (see Part 1, Item 2, “Management's Discussion and Analysis of
Financial Condition and Results of Operations - Financial Condition - Regulatory
Matters - Environmental Matters”); and (iv) Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 2011 (see Part 1, Item 2, “Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Financial Condition - Regulatory Matters -Environmental Matters”):
(a)    Neither the Company nor any Subsidiary has knowledge of any claim or has
received any notice of any claim, and no proceeding has been instituted raising
any claim against

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the Company or any of its Subsidiaries or any of their respective real
properties now or formerly owned, leased or operated by any of them or other
assets, alleging any damage to the environment or violation of any Environmental
Laws, except, in each case, such as could not reasonably be expected to result
in a Material Adverse Effect;
(b)    Neither the Company nor any Subsidiary has knowledge of any facts which
would give rise to any claim, public or private, of violation of Environmental
Laws or damage to the environment emanating from, occurring on or in any way
related to real properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect;
(c)    Neither the Company nor any Subsidiary has stored any Hazardous Materials
on real properties now or formerly owned, leased or operated by any of them and
has not disposed of any Hazardous Materials in a manner contrary to any
Environmental Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect; and
(d)    All buildings on all real properties now owned, leased or operated by the
Company or any Subsidiary are in compliance with applicable Environmental Laws,
except where failure to comply could not reasonably be expected to result in a
Material Adverse Effect.
Section 6.
REPRESENTATIONS OF THE PURCHASERS.

Section 6.1.    Purchase for Investment. Each Purchaser severally represents
that it is purchasing the Notes for its own account or for one or more separate
accounts maintained by such Purchaser or for the account of one or more pension
or trust funds and not with a view to the distribution thereof, provided that
the disposition of such Purchaser's or their property shall at all times be
within such Purchaser's or their control. Each Purchaser understands that the
Notes have not been registered under the Securities Act and may be resold only
if registered pursuant to the provisions of the Securities Act or if an
exemption from registration is available, except under circumstances where
neither such registration nor such an exemption is required by law, and that the
Company is not required to register the Notes.
Section 6.2.    Source of Funds. Each Purchaser severally represents that at
least one of the following statements is an accurate representation as to each
source of funds (a “Source”) to be used by such Purchaser to pay the purchase
price of the Notes to be purchased by such Purchaser hereunder:
(a)    the Source is an “insurance company general account” (as the term is
defined in the United States Department of Labor's Prohibited Transaction
Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as
defined by the annual statement for life insurance companies approved by the
National Association of Insurance Commissioners (the “NAIC Annual Statement”))
for the general account contract(s) held by or on behalf of any employee benefit
plan together with the amount of the reserves and liabilities for the general
account contract(s) held by or on behalf of any other employee benefit plans
maintained by the same employer (or affiliate thereof as defined in PTE 95-60)
or by the same employee organization in the general account do

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not exceed 10% of the total reserves and liabilities of the general account
(exclusive of separate account liabilities) plus surplus as set forth in the
NAIC Annual Statement filed with such Purchaser's state of domicile; or
(b)    the Source is a separate account that is maintained solely in connection
with such Purchaser's fixed contractual obligations under which the amounts
payable, or credited, to any employee benefit plan (or its related trust) that
has any interest in such separate account (or to any participant or beneficiary
of such plan (including any annuitant)) are not affected in any manner by the
investment performance of the separate account; or
(c)    the Source is either (i) an insurance company pooled separate account,
within the meaning of PTE 90-1 or (ii) a bank collective investment fund, within
the meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the
Company in writing pursuant to this clause (c), no employee benefit plan or
group of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such pooled separate
account or collective investment fund; or
(d)    the Source constitutes assets of an “investment fund” (within the meaning
of Part V of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified
professional asset manager” or “QPAM” (within the meaning of Part V of the QPAM
Exemption), no employee benefit plan's assets that are included in such
investment fund, when combined with the assets of all other employee benefit
plans established or maintained by the same employer or by an affiliate (within
the meaning of Section V(c)(1) of the QPAM Exemption) of such employer or by the
same employee organization and managed by such QPAM, exceed 20% of the total
client assets managed by such QPAM, the conditions of Part I(a), (c) and (g) of
the QPAM Exemption are satisfied, the QPAM does not own a 10% or more interest
in the Company and any person controlling or controlled by the QPAM (applying
the definition of “control” in Section V(e) of the QPAM Exemption) does not own
a 20% or more interest in the Company or the Parent Guarantor and (i) the
identity of such QPAM and (ii) the names of all employee benefit plans whose
assets are included in such investment fund have been disclosed to the Company
in writing pursuant to this clause (d); or
(e)    the Source constitutes assets of a “plan(s)” (within the meaning of
Section IV of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset
manager” or “INHAM” (within the meaning of Part IV of the INHAM Exemption), the
conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied,
neither the INHAM nor a person controlling or controlled by the INHAM (applying
the definition of “control” in Section IV(d) of the INHAM Exemption) owns a 5%
or more interest in the Company and (i) the identity of such INHAM and (ii) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have
been disclosed to the Company in writing pursuant to this clause (e); or
(f)    the Source is a governmental plan; or

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(g)    the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which has
been identified to the Company in writing pursuant to this clause (g); or
(h)    the Source does not include assets of any employee benefit plan, other
than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms “employee benefit plan,” “governmental
plan,” and “separate account” shall have the respective meanings assigned to
such terms in section 3 of ERISA.
Section 7.
INFORMATION AS TO COMPANY.

Section 7.1.    Financial and Business Information. The Company shall deliver to
each holder of Notes that is an Institutional Investor:
(a)    Quarterly Statements - within 60 days (or such shorter period as is 15
days greater than the period applicable to the filing of the Company's Quarterly
Report on Form 10‑Q (the “Form 10‑Q”) with the SEC regardless of whether the
Company is subject to the filing requirements thereof) after the end of each
quarterly fiscal period in each fiscal year of the Company (other than the last
quarterly fiscal period of each such fiscal year), duplicate copies of,
(i)    a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such quarter, and
(ii)    consolidated statements of income, changes in shareholders' equity and
cash flows of the Company and its Subsidiaries, for such quarter and (in the
case of the second and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer as fairly presenting, in all material
respects, the financial position of the companies being reported on and their
results of operations and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period specified above of
copies of the Company's Form 10‑Q prepared in compliance with the requirements
therefor and filed with the SEC shall be deemed to satisfy the requirements of
this Section 7.1(a), provided, further, that the Company shall be deemed to have
made such delivery of such Form 10‑Q if it shall have timely made such Form 10‑Q
available on “EDGAR” and on its home page on the worldwide web (at the date of
this Agreement located at: http//www.cleco.com) and shall have given each
Purchaser prior notice of such availability on EDGAR and on its home page in
connection with each delivery (such availability and notice thereof being
referred to as “Electronic Delivery”);

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(b)    Annual Statements - within 120 days (or such shorter period as is 15 days
greater than the period applicable to the filing of the Company's Annual Report
on Form 10‑K (the “Form 10‑K”) with the SEC regardless of whether the Company is
subject to the filing requirements thereof) after the end of each fiscal year of
the Company, duplicate copies of
(i)    a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such year, and
(ii)    consolidated statements of income, changes in shareholders' equity and
cash flows of the Company and its Subsidiaries for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon of independent public accountants of
recognized national standing, which opinion shall state that such financial
statements present fairly, in all material respects, the financial position of
the companies being reported upon and their results of operations and cash flows
and have been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, provided that
the delivery within the time period specified above of the Company's Form 10‑K
for such fiscal year (together with the Company's annual report to shareholders,
if any, prepared pursuant to Rule 14a‑3 under the Exchange Act) prepared in
accordance with the requirements therefor and filed with the SEC shall be deemed
to satisfy the requirements of this Section 7.1(b), provided, further, that the
Company shall be deemed to have made such delivery of such Form 10‑K if it shall
have timely made Electronic Delivery thereof;
(c)    SEC and Other Reports - promptly upon their becoming available, one copy
of (i) each financial statement, report, notice or proxy statement sent by the
Company or any Subsidiary to its securities holders generally, and (ii) each
regular or periodic report, each registration statement (without exhibits except
as expressly requested by such holder), and each prospectus and all amendments
thereto filed by the Company or any Subsidiary with the SEC and of all press
releases and other statements made available generally by the Company or any
Subsidiary to the public concerning developments that are Material;
(d)    Notice of Default or Event of Default - promptly, and in any event within
five Business Days after a Responsible Officer becoming aware of the existence
of a Default or Event or Default of the type referred to in Sections 11(a), (b),
(h) and (i) and within fifteen days after a Responsible Officer becoming aware
of the existence of any other Default or Event of Default or that any Person has
given any notice or taken any action with respect to a claimed default hereunder
or that any Person has given any notice or taken any action with respect to a
claimed default of the type referred to in Section 11(g), a written notice
specifying the nature and period of existence thereof and what action the
Company is taking or proposes to take with respect thereto;

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(e)    ERISA Matters - promptly, and in any event within five days after a
Responsible Officer becoming aware of any of the following, a written notice
setting forth the nature thereof and the action, if any, that the Company or an
ERISA Affiliate proposes to take with respect thereto:
(i)    with respect to any Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which notice
thereof has not been waived pursuant to such regulations as in effect on the
date hereof; or
(ii)    the taking by the PBGC of steps to institute, or the threatening by the
PBGC of the institution of, proceedings under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from a Multi-employer
Plan that such action has been taken by the PBGC with respect to such
Multi-employer Plan; or
(iii)    any event, transaction or condition that could result in the incurrence
of any liability by the Company or any ERISA Affili-ate pursuant to Title I or
IV of ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant to Title I
or IV of ERISA or such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse Effect;
(f)    Notices from Governmental Authority - promptly, and in any event within
30 days of receipt thereof, copies of any notice to the Company or any
Subsidiary from any Federal or state Governmental Authority relating to any
order, ruling, statute or other law or regulation that could reasonably be
expected to have a Material Adverse Effect; and
(g)    Requested Information - with reasonable promptness, such other data and
information relating to the business, operations, affairs, financial condition,
assets or properties of the Company or any of its Subsidiaries (including, but
without limitation, actual copies of the Company's Form 10‑Q and Form 10‑K) or
relating to the ability of the Company to perform its obligations hereunder and
under the Notes as from time to time may be reasonably requested by any such
holder of Notes.
Section 7.2.    Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
shall be accompanied by a certificate of a Senior Financial Officer setting
forth (which, in the case of Electronic Delivery of any such financial
statements, shall be by separate concurrent delivery of such certificate to each
holder of Notes):

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(a)    Covenant Compliance - the information (including detailed calculations)
required in order to establish whether the Company was in compliance with the
requirements of Sections 10.5 through 10.7, inclusive, during the quarterly or
annual period covered by the statements then being furnished (including with
respect to each such Section, where applicable, the calculations of the maximum
or minimum amount, ratio or percentage, as the case may be, permissible under
the terms of such Sections, and the calculation of the amount, ratio or
percentage then in existence); and
(b)    Event of Default - a statement that such Senior Financial Officer has
reviewed the relevant terms hereof and has made, or caused to be made, under his
or her supervision, a review of the transactions and conditions of the Company
and its Subsidiaries from the beginning of the quarterly or annual period
covered by the statements then being furnished to the date of the certificate
and that such review shall not have disclosed the existence during such period
of any condition or event that constitutes a Default or an Event of Default or,
if any such condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company or any
Subsidiary to comply with any Environmental Law), specifying the nature and
period of existence thereof and what action the Company shall have taken or
proposes to take with respect thereto.
Section 7.3.    Visitation. The Company shall permit the representatives of each
holder of Notes that is an Institutional Investor:
(a)    No Default - if no Default or Event of Default then exists, at the
expense of such holder and upon reasonable prior notice to the Company, to visit
the principal executive office of the Company, to discuss the affairs, finances
and accounts of the Company and its Subsidiaries with the Company's officers,
and (with the consent of the Company, which consent will not be unreasonably
withheld) to visit the other offices and properties of the Company and each
Subsidiary, in each case no more than once per calendar year and at such
reasonable times as may be requested in writing; and
(b)    Default - if a Default or Event of Default then exists, at the expense of
the Company to visit and inspect any of the offices or properties of the Company
or any Subsidiary, to examine all their respective books of account, records,
reports and other papers, to make copies and extracts therefrom, and to discuss
their respective affairs, finances and accounts with their respective officers
and independent public accountants (and by this provision the Company authorizes
said accountants to discuss the affairs, finances and accounts of the Company
and its Subsidiaries), all at such times and as often as may be requested;
provided that no holder of Notes shall be entitled to examine or make copies or
abstracts of, or otherwise obtain information with respect to, the Company's
records relating to pending or threatened litigation if any such disclosure by
the Company would reasonably be expected (i) to give rise to a waiver of any
attorney/client privilege of the Company or any of its Subsidiaries relating to
such information or (ii) to be otherwise materially disadvantageous to the
Company or any of its Subsidiaries in the defense of such litigation; and
provided, further, that in the case of

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any discussion with the accountants, only if the Company has been given the
opportunity to participate in the discussion.
Section 8.
PAYMENT AND PREPAYMENT OF THE NOTES.

Section 8.1.    Maturity. As provided therein, the entire unpaid principal
balance of the Notes shall be due and payable on the stated maturity date
thereof.
Section 8.2.    Optional Prepayments with Make-Whole Amount. The Company may, at
its option, upon notice as provided below, prepay at any time all, or from time
to time any part of, the Notes, in an amount not less than 5% of the aggregate
principal amount of the Notes then outstanding in the case of a partial
prepayment, at 100% of the principal amount so prepaid, and the Make-Whole
Amount determined for the prepayment date with respect to such principal amount.
The Company will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice shall specify
such date (which shall be a Business Day), the aggregate principal amount of the
Notes to be prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 8.3), and the
interest to be paid on the prepayment date with respect to such principal amount
being prepaid, and shall be accompanied by a certificate of a Senior Financial
Officer as to the estimated Make-Whole Amount due in connection with such
prepayment (calculated as if the date of such notice were the date of the
prepayment), setting forth the details of such computation. Two Business Days
prior to such prepayment, the Company shall deliver to each holder of Notes a
certificate of a Senior Financial Officer specifying the calculation of such
Make-Whole Amount as of the specified prepayment date.
Section 8.3.    Allocation of Partial Prepayments. In the case of each partial
prepayment of the Notes, the principal amount of the Notes to be prepaid shall
be allocated among all of the Notes at the time outstanding in proportion, as
nearly as practicable, to the respective unpaid principal amounts thereof not
theretofore called for prepayment.
Section 8.4.    Maturity; Surrender, Etc     In the case of each prepayment of
Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment (which shall be a Business Day), together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and cancelled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
Section 8.5.    Purchase of Notes. The Company will not and will not permit any
Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except (a) upon the payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes or (b) pursuant to an offer to purchase made by the Company or an
Affiliate pro rata to the holders of all Notes at the time outstanding upon the

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same terms and conditions. Any such offer shall provide each holder with
sufficient information to enable it to make an informed decision with respect to
such offer, and shall remain open for at least 30 Business Days. If the holders
of more than 30% of the principal amount of the Notes then outstanding accept
such offer, the Company shall promptly notify the remaining holders of such fact
and the expiration date for the acceptance by holders of Notes of such offer
shall be extended by the number of days necessary to give each such remaining
holder at least 10 Business Days from its receipt of such notice to accept such
offer. The Company will promptly cancel all Notes acquired by it or any
Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to
any provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.
Section 8.6.    Make-Whole Amount.
“Make-Whole Amount” means, with respect to any Note, an amount equal to the
excess, if any, of the Discounted Value of the Remaining Scheduled Payments with
respect to the Called Principal of such Note over the amount of such Called
Principal, provided that the Make-Whole Amount may in no event be less than
zero. For the purposes of determining the Make-Whole Amount, the following terms
have the following meanings:
“Called Principal” means, with respect to any Note, the principal of such Note
that is to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context requires.
“Discounted Value” means, with respect to the Called Principal of any Note, the
amount obtained by discounting all Remaining Scheduled Payments with respect to
such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
“Reinvestment Yield” means, with respect to the Called Principal of any Note,
.50% over the yield to maturity implied by (i) the yields reported as of 10:00
a.m. (New York City time) on the second Business Day preceding the Settlement
Date with respect to such Called Principal, on the display designated as “Page
PX1” (or such other display as may replace Page PX1) on Bloomberg Financial
Markets for the most recently issued actively traded on the run U.S. Treasury
securities having a maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date, or (ii) if such yields are not reported as
of such time or the yields reported as of such time are not ascertainable
(including by way of interpolation), the Treasury Constant Maturity Series
Yields reported, for the latest day for which such yields have been so reported
as of the second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable
successor publication) for on the run U.S. Treasury securities having a constant
maturity equal to the Remaining Average Life of such Called Principal as of such
Settlement Date.
In the case of each determination under clause (i) or clause (ii), as the case
may be, of the preceding paragraph, such implied yield will be determined, if
necessary, by (a) converting U.S.

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Treasury bill quotations to bond equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly between (1) the applicable on
the run U.S. Treasury security with the maturity closest to and greater than
such Remaining Average Life and (2) the applicable on the run U.S. Treasury
security with the maturity closest to and less than such Remaining Average Life.
The Reinvestment Yield shall be rounded to the number of decimal places as
appears in the interest rate of the applicable Note.
“Remaining Average Life” means, with respect to any Called Principal, the number
of years (calculated to the nearest one-twelfth year) obtained by dividing
(i) such Called Principal into (ii) the sum of the products obtained by
multiplying (a) the principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (b) the number of years (calculated to the
nearest one-twelfth year) that will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.
“Remaining Scheduled Payments” means, with respect to the Called Principal of
any Note, all payments of such Called Principal and interest thereon that would
be due after the Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled due date,
provided that if such Settlement Date is not a date on which interest payments
are due to be made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of interest
accrued to such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or Section 12.1.
“Settlement Date” means, with respect to the Called Principal of any Note, the
date on which such Called Principal is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
Section 9.
AFFIRMATIVE COVENANTS.

The Company covenants that so long as any of the Notes are outstanding:
Section 9.1.    Compliance with Law. Without limiting Section 10.4, the Company
will, and will cause each of its Subsidiaries to, comply with all laws,
ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, ERISA, the USA Patriot Act and
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, except such thereof as shall be contested in good faith and, if
applicable, by appropriate proceedings diligently conducted by it.

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Section 9.2.    Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.
Section 9.3.    Maintenance of Properties. The Company will, and will cause each
of its Subsidiaries to, maintain and keep, or cause to be maintained and kept,
their respective properties in good repair, working order and condition (other
than ordinary wear and tear), so that the business carried on in connection
therewith may be properly conducted at all times, provided that this Section
shall not prevent the Company or any Subsidiary from discontinuing the operation
and the maintenance of any of its properties if such discontinuance is desirable
in the conduct of its business and the Company has concluded that such
discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
Section 9.4.    Payment of Taxes and Claims. The Company will, and will cause
each of its Subsidiaries to, file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or franchises, to the
extent the same have become due and payable and before they have become
delinquent and all claims for which sums have become due and payable that have
or might become a Lien on properties or assets of the Company or any Subsidiary,
provided that neither the Company nor any Subsidiary need pay any such tax,
assessment, charge, levy or claim if (i) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (ii) the nonpayment of all such taxes,
assessments, charges, levies and claims in the aggregate could not reasonably be
expected to have a Material Adverse Effect.
Section 9.5.    Limited Liability Company Existence, Etc. Subject to
Section 10.2, the Company will at all times preserve and keep in full force and
effect its limited liability company existence. Subject to Sections 10.2, the
Company will at all times preserve and keep in full force and effect the
corporate or other legal entity existence of each of its Subsidiaries (unless
merged into the Company or another Subsidiary (other than an Excluded
Subsidiary)) and all rights and franchises of the Company and its Subsidiaries
unless, in the good faith judgment of the Company, the termination of or failure
to preserve and keep in full force and effect such corporate existence, right or
franchise could not, individually or in the aggregate, have a Material Adverse
Effect.
Section 9.6.    Books and Records. The Company will, and will cause each of its
Subsidiaries to, maintain proper books of record and account in conformity with
GAAP and all applicable requirements of any Governmental Authority having legal
or regulatory jurisdiction over the Company or such Subsidiary, as the case may
be.

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Section 10.
NEGATIVE COVENANTS.

The Company covenants that so long as any of the Notes are out-standing:
Section 10.1.    Transactions with Affiliates. The Company will not and will not
permit any Subsidiary to enter into directly or indirectly any transaction or
group of related transactions (including without limitation the purchase, lease,
sale or exchange of properties of any kind or the rendering of any service) with
any Affiliate (other than the Company or another Subsidiary (other than an
Excluded Subsidiary)), except (i) in the ordinary course and pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such Subsidiary
than would be obtainable in a comparable arm's-length transaction with a Person
not an Affiliate, (ii) for any transaction that is in compliance with the
applicable laws and regulations of the Federal Energy Regulatory Commission and
the LPSC (or successor regulatory agencies thereto) pertaining to affiliate
transactions or (iii) any Receivables Securitization permitted by this
Agreement.
Section 10.2.    Merger, Consolidation, Etc. The Company will not, and will not
permit any Subsidiary to, consolidate with or merge with any other Person or
convey, transfer or lease all or substantially all of its assets in a single
transaction or series of transactions to any Person (except that any Subsidiary
may merge with or into, or convey, transfer or lease all or substantially all of
its assets to, the Company or another Subsidiary (other than an Excluded
Subsidiary) if (1) in any such merger or consolidation involving the Company,
the Company is the survivor and (2) immediately before and immediately after
giving effect to any such merger, consolidation or conveyance, transfer or
lease, no Default or Event of Default would exist), unless:
(a)    in the case of the Company, the successor formed by such consolidation or
the survivor of such merger or the Person that acquires by conveyance, transfer
or lease all or substantially all of the assets of the Company as an entirety,
as the case may be, shall be a solvent limited liability company or corporation
organized and existing under the laws of the United States or any State thereof
(including the District of Columbia), and, if the Company is not such surviving
limited liability company or corporation, (i) such limited liability company or
corporation shall have executed and delivered to each holder of any Notes its
assumption of the due and punctual performance and observance of each covenant
and condition of this Agreement and the Notes and (ii) shall have caused to be
delivered to each holder of any Notes an opinion of nationally recognized
independent counsel, or other independent counsel reasonably satisfactory to the
Required Holders, to the effect that all agreements or instruments effecting
such assumption are enforceable in accordance with their terms and comply with
the terms hereof; and
(b)    immediately before and immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing (it being agreed that, for purposes of determining compliance with
Section 10.7, such transaction shall be treated on a pro forma basis for the
relevant period as having been consummated as of the last day of the immediately
preceding fiscal quarter).

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No such conveyance, transfer or lease of all or substantially all of the assets
of the Company shall have the effect of releasing the Company or any successor
limited liability company or corporation that shall theretofore have become such
in the manner prescribed in this Section 10.2 from its liability under this
Agreement or the Notes.
Section 10.3.    Line of Business. The Company will not and will not permit any
Subsidiary to engage in any business if, as a result, the general nature of the
business in which the Company and its Subsidiaries, taken as a whole, would then
be engaged would be substantially changed from the general nature of the
business in which the Company and its Subsidiaries, taken as a whole, are
engaged on the date of this Agreement as described in the Memorandum.
Section 10.4.    Terrorism Sanctions Regulations. The Company will not and will
not permit any Controlled Entity to (a) become a Blocked Person or (b) have any
investments in or engage in any dealings or transactions with any Blocked
Person.
Section 10.5.    Liens. The Company shall not, and shall not permit any
Subsidiary to, create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired by it, except:

(a)    Permitted Encumbrances;

(b)    any Lien existing on any property or asset prior to the acquisition
thereof by the Company or any of its Subsidiaries, or existing on any property
of any Person that becomes a Subsidiary after the date of Closing prior to the
time such Person becomes a Subsidiary or that is merged with or into or
consolidated with the Company or any Subsidiary prior to such merger or
consolidation, provided that (i) such Lien is not created in contemplation of or
in connection with such acquisition or such Person becoming a Subsidiary or such
merger, as the case may be, (ii) such Lien shall not apply to any other property
or asset of the Company or any of the Subsidiaries, and (iii) such Lien shall
secure only those obligations and liabilities that it secures on the date of
such acquisition or the date such Person becomes a Subsidiary of the Company or
such merger, as the case may be;

(c)    Liens (including precautionary Liens in connection with Capital Lease
Obligations) on fixed or capital assets and other property related thereto
(including any natural gas, oil or other mineral assets, pollution control
facilities, electrical generating plants, equipment and machinery, and related
accounts, financial assets, contracts and general intangibles) acquired,
constructed, explored, drilled, developed or improved by the Company, provided
that (i) such security interests and the obligations and liabilities secured
thereby are incurred prior to or within 270 days after the acquisition of the
relevant asset or the completion of the relevant construction, exploration,
drilling, development or improvement, or within 270 days after the extension,
renewal, refinancing or replacement of the obligations and liabilities secured
thereby, as the case may be, (ii) the obligations and liabilities secured
thereby do not exceed the cost of acquiring, constructing, exploring, drilling,
developing, or improving the relevant assets,

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and (iii) such security interests shall not apply to any other property beyond
the relevant property set forth in this subsection (c) (and in the case of
construction or improvement, any theretofore unimproved real property on which
the property so constructed or the improvement is located);

(d)    Liens on any Equity Interest of any Person owned or otherwise held by or
on behalf of the Company created in connection with any project financing at
such Person; provided that (x) such Person's sole purpose and activity is and
continues to be the acquisition, development or operation of assets relating to
a specific project (and where the lender in respect of such project financing is
materially reliant on such project for repayment) and (y) any such Liens do not
include a recourse covenant to pay with respect to the Company or any Subsidiary
(other than such Person);

(e)    Liens securing the payment of Indebtedness of the Company to a state of
the United States or any political subdivision thereof issued in a transaction
in which such state or political subdivision issued industrial revenue bonds or
other obligations, the interest on which is excludable from gross income by the
holders thereof pursuant to the provisions of the Internal Revenue Code, as in
effect at the time of the issuance of such obligations, for the purposes of
financing or refinancing, in whole or in part, the acquisition or construction
of property used or to be used by the Company to the extent such lien covers
only such acquired or constructed property, and Indebtedness to the issuer of a
letter of credit, bond insurance or guaranty to support any such obligations to
the extent the Company is required to reimburse such issuer for drawings under
such letter of credit, bond insurance or guaranty with respect to the principal
of or interest on such obligations;

(f)    Liens created to secure Indebtedness of any Subsidiary to the Company or
to any of the Company's other Subsidiaries (other than an Excluded Subsidiary);

(g)    Liens created by any Receivables SPC in connection with a Receivables
Securitization and Liens created to secure other sales or factoring of accounts
receivables and other receivables, provided that the aggregate amount of all of
the foregoing shall not exceed $50,000,000 at any time;

(h)    [intentionally omitted;]

(i)    Liens to secure obligations of the Company in respect of Hedge Agreements
with counterparties in the ordinary course of business and not for speculation,
provided that the aggregate amount secured under this clause (i) shall not
exceed $100,000,000 at any time (or such lesser or greater amount as from time
to time permitted by the Bank Credit Agreement);

(j)    Liens created for the sole purpose of extending, renewing or replacing in
whole or in part Indebtedness secured by any lien, mortgage or security interest
referred to in the foregoing clauses (a) through (i), provided, however, that
the principal amount of Indebtedness secured thereby shall not exceed the
principal amount of Indebtedness so

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secured at the time of such extension, renewal or replacement and that such
extension, renewal or replacement, as the case may be, shall be limited to all
or a part of the property or indebtedness that secured the lien or mortgage so
extended, renewed or replaced (and any improvements on such property);

(k)    Liens created by any Finsub for any Securitization Financing pursuant to
any Securitization Financing Order;

(l)    Liens on cash or invested funds used to make a defeasance, covenant
defeasance or in substance defeasance of any Indebtedness pursuant to an express
contractual provision in the agreements governing such Indebtedness or GAAP,
provided that immediately before and immediately after giving effect to the
making of such defeasance, no Default or Event of Default shall exist; and

(m)    the Lien evidenced by the Utility Mortgage securing any Indebtedness;
provided that (i) such Lien shall not extend to or over any property of a
character not subject on the date of Closing to the Lien granted under the
Utility Mortgage, (ii) at the time of incurrence of such Indebtedness and
immediately after giving effect thereto, no Default or Event of Default exists
and (iii) if at any time the aggregate amount of outstanding Indebtedness
secured by such Lien exceeds 15% of Total Assets then the Company shall promptly
provide the holders with equal and ratable security for the Notes with all other
Indebtedness secured by the Utility Mortgage pursuant to documentation
reasonably satisfactory to the Required Holders (or issue first mortgage bonds
under and secured by the Utility Mortgage in exchange for the Notes); and
provided, further, that Priority Debt does not at any time exceed 20% of Total
Assets.

The Company agrees that neither it nor any of its Subsidiaries shall use any
capability under subparagraph (m) of this Section 10.5 to secure any amounts
owed or outstanding under the Bank Credit Agreement or the Indenture unless the
Notes and this Agreement are also concurrently equally and ratably secured
pursuant to documentation reasonably satisfactory to the Required Holders (or
first mortgage bonds have been issued under and secured by the Utility Mortgage
in exchange for the Notes).
Section 10.6.    Subsidiary Indebtedness. The Company will not permit any
Subsidiary to create, incur, assume, guarantee or otherwise become liable with
respect to any Indebtedness other than:
(a)    Indebtedness outstanding on the date hereof as specified in Schedule 5.15
and any extension, renewal, refinancing or replacement thereof in whole or in
part, provided that the principal amount thereof immediately prior to such
extension, renewal, refinancing or replacement is not increased (except for
increases in an amount not to exceed accrued interest, premium, fees and
expenses in connection therewith);
(b)    Indebtedness owed by any Subsidiary to the Company or any other
Subsidiary (other than an Excluded Subsidiary);

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(c)    Indebtedness of a Subsidiary existing at the time such Subsidiary becomes
a Subsidiary (and not incurred in anticipation thereof) and any extension,
renewal, refinancing or replacement thereof in whole or in part, provided that
the principal amount thereof immediately prior to such extension, renewal,
refinancing or replacement is not increased (except for increases in an amount
not to exceed accrued interest, premium, fees and expenses in connection
therewith);
(d)    Indebtedness secured by any Lien permitted by Section 10.5; and
(e)     Indebtedness not otherwise permitted by subparagraphs (a) through (d)
above, provided that (i) immediately after giving effect to the creation,
incurrence or assumption thereof, no Default or Event of Default exists and (ii)
Priority Debt does not at any time exceed 20% of Total Assets.
Section 10.7.    Leverage Ratio. The Company will not permit its Total
Indebtedness to be greater than 65% of Total Capitalization as of the end of any
fiscal quarter or fiscal year end of the Company.
Section 11.
EVENTS OF DEFAULT.

An “Event of Default” shall exist if any of the following conditions or events
shall occur and be continuing:
(a)    the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b)    the Company defaults in the payment of any interest on any Note for more
than five Business Days after the same becomes due and payable; or
(c)    the Company defaults in the performance of or compliance with any term
contained in Section 7.1(d); or
(d)    the Company defaults in the performance of or compliance with any term
contained in Section 10 and such default is not remedied within 15 days after
the earlier of (i) a Responsible Officer obtaining actual knowledge of such
default and (ii) the Company receiving written notice of such default from any
holder of a Note (any such written notice to be identified as a “notice of
default” and to refer specifically to this Section 11(d)); or
(e)    the Company defaults in the performance of or compliance with any term
contained herein (other than those referred to in Sections 11(a), (b), (c) and
(d)) and such default is not remedied within 30 days after the earlier of (i) a
Responsible Officer obtaining actual knowledge of such default and (ii) the
Company receiving written notice of such default from any holder of a Note (any
such written notice to be identified as a “notice of default” and to refer
specifically to this Section 11(e)); or

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(f)    any representation or warranty made in writing by or on behalf of the
Company or by any officer of the Company in this Agreement or in any writing
furnished in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which made; or
(g)    (i) the Company or any Subsidiary is in default (as principal or as
guarantor or other surety) in the payment of any principal of or premium or
make-whole amount or interest on any Indebtedness that is outstanding in an
aggregate principal amount of at least $50,000,000 beyond any period of grace
provided with respect thereto, provided that this clause (g)(i) shall not apply
to any Indebtedness of a Finsub or a Receivables SPC so long as there is no
recourse with respect to such Indebtedness to the Company or any of its
Subsidiaries; or (ii) the Company or any Subsidiary is in default in the
performance of or compliance with any term of any evidence of any Indebtedness
in an aggregate outstanding principal amount of at least $50,000,000 or of any
mortgage, indenture or other agreement relating thereto or any other condition
exists, and as a consequence of such default or condition such Indebtedness has
become, or has been declared, due and payable before its stated maturity or
before its regularly scheduled dates of payment, or (iii) as a consequence of
the occurrence or continuation of any event or condition (other than the passage
of time or the right of the holder of Indebtedness to convert such Indebtedness
into equity interests), the Company or any Subsidiary has become obligated to
purchase or repay Indebtedness before its regular maturity or before its
regularly scheduled dates of payment in an aggregate outstanding principal
amount of at least $50,000,000, provided that clause (g)(ii) and (iii) shall not
apply to (A) Indebtedness that becomes due as a result of a notice of voluntary
prepayment or redemption delivered by the Company or a Subsidiary, (B) secured
Indebtedness that becomes due solely as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness, (C) intercompany
indebtedness, (D) the exercise of any contractual right to cause the prepayment
of any Indebtedness relating to tax exempt bonds or securities (other than (1)
the exercise of a remedy for an event of default under the applicable contract
or agreement or (2) the right to cause such prepayment as a result of the
occurrence or continuation of any event or condition relating to the Company or
any Subsidiary, which event or condition is expressly provided for under the
applicable contract or agreement as giving rise to such prepayment right), or
(E) any Indebtedness of a Finsub or a Receivables SPC so long as there is no
recourse with respect to such Indebtedness to the Company or any of its
Subsidiaries; or
(h)    the Company or any Subsidiary (i) is generally not paying, or admits in
writing its inability to pay, its debts as they become due, (ii) files, or
consents by answer or otherwise to the filing against it of, a petition for
relief or reorganization or arrangement or any other petition in bankruptcy, for
liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (iii) makes an assignment
for the benefit of its creditors, (iv) consents to the appointment of a
custodian, receiver, trustee or other officer with similar powers with respect
to it or with respect to any substantial part of its property, (v) is
adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for
the purpose of any of the foregoing; or

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(i)    a court or Governmental Authority of competent jurisdiction enters an
order appointing, without consent by the Company or any of its Subsidiaries, a
custodian, receiver, trustee or other officer with similar powers with respect
to it or with respect to any substantial part of its property, or constituting
an order for relief or approving a petition for relief or reorganization or any
other petition in bankruptcy or for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution,
winding-up or liquidation of the Company or any of its Subsidiaries, or any such
petition shall be filed against the Company or any of its Subsidiaries and such
petition shall not be dismissed within 60 days; or
(j)    a final judgment or judgments for the payment of money aggregating in
excess of $50,000,000 (unless fully covered by insurance after taking into
account any applicable deductibles, as confirmed in writing by a reputable
insurer) are rendered against one or more of the Company and its Subsidiaries
and which judgments are not, within 60 days after entry thereof, bonded,
discharged or stayed pending appeal, or are not discharged within 60 days after
the expiration of such stay; or
(k)    if (i) any Plan shall fail to satisfy the minimum funding standards of
ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted under
section 412 of the Code, (ii) a notice of intent to terminate any Plan shall
have been or is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the Company or
any ERISA Affiliate that a Plan may become a subject of any such proceedings,
(iii) there is any “amount of unfunded benefit liabilities” (within the meaning
of section 4001(a)(18) of ERISA) under one or more Plans, determined in
accordance with Title IV of ERISA, (iv) the Company or any ERISA Affiliate shall
have incurred or is reasonably expected to incur any liability pursuant to Title
I or IV of ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans, (v) the Company or any ERISA Affiliate withdraws from
any Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or
amends any employee welfare benefit plan that provides post-employment welfare
benefits in a manner that would increase the liability of the Company or any
Subsidiary thereunder; and any such event or events described in clauses (i)
through (vi) above, either individually or together with any other such event or
events, could reasonably be expected to have a Material Adverse Effect.
As used in Section 11(k), the terms “employee benefit plan” and “employee
welfare benefit plan” shall have the respective meanings assigned to such terms
in section 3 of ERISA.
Section 12.
REMEDIES ON DEFAULT, ETC.

Section 12.1.    Acceleration. (a) If an Event of Default with respect to the
Company described in Section 11(h) or (i) (other than an Event of Default
described in clause (i) of Section 11(h) or described in clause (vi) of
Section 11(h) by virtue of the fact that such clause

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encompasses clause (i) of Section 11(h)) has occurred, all the Notes then
outstanding shall automatically become immediately due and payable.
(b)    If any other Event of Default has occurred and is continuing, any holder
or holders of more than 50% in principal amount of the Notes at the time
outstanding may at any time at its or their option, by notice or notices to the
Company, declare all the Notes then outstanding to be immediately due and
payable.
(c)    If any Event of Default described in Section 11(a) or (b) has occurred
and is continuing, any holder or holders of Notes at the time outstanding
affected by such Event of Default may at any time, at its or their option, by
notice or notices to the Company, declare all the Notes held by it or them to be
immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Notes will forthwith mature and the entire
unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest
thereon (including, but not limited to, interest accrued thereon at the Default
Rate) and (y) the Make-Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
Section 12.2.    Other Remedies. If any Default or Event of Default has occurred
and is continuing, and irrespective of whether any Notes have become or have
been declared immediately due and payable under Section 12.1, the holder of any
Note at the time outstanding may proceed to protect and enforce the rights of
such holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise.
Section 12.3.    Rescission. At any time after any Notes have been declared due
and payable pursuant to Section 12.1(b) or (c), the holders of not less than 51%
in principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if
(a) the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) neither the Company nor any other Person shall have paid any amounts
which have become due solely by reason of such declaration, (c) all Events of
Default and Defaults, other than non-payment of amounts that have become due
solely by reason of such declaration, have been cured or have been waived
pursuant to Section 17, and (d) no judgment or decree has been entered for the
payment of any monies due

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pursuant hereto or to the Notes. No rescission and annulment under this Section
12.3 will extend to or affect any subsequent Event of Default or Default or
impair any right consequent thereon.
Section 12.4.    No Waivers or Election of Remedies, Expenses, Etc. No course of
dealing and no delay on the part of any holder of any Note in exercising any
right, power or remedy shall operate as a waiver thereof or otherwise prejudice
such holder's rights, powers or remedies. No right, power or remedy conferred by
this Agreement or by any Note upon any holder thereof shall be exclusive of any
other right, power or remedy referred to herein or therein or now or hereafter
available at law, in equity, by statute or otherwise. Without limiting the
obligations of the Company under Section 15, the Company will pay to the holder
of each Note on demand such further amount as shall be sufficient to cover all
costs and expenses of such holder incurred in any enforcement or collection
under this Section 12, including, without limitation, reasonable attorneys'
fees, expenses and disbursements.
Section 13.
REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

Section 13.1.    Registration of Notes. The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes. The name and address of each holder of one or more Notes, each
transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.
Section 13.2.    Transfer and Exchange of Notes. Upon surrender of any Note to
the Company at the address and to the attention of the designated officer (all
as specified in Section 18(iii)), for registration of transfer or exchange (and
in the case of a surrender for registration of transfer accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
such holder's attorney duly authorized in writing and accompanied by the
relevant name, address and other information for notices of each transferee of
such Note or part thereof), within ten Business Days thereafter, the Company
shall execute and deliver, at the Company's expense (except as provided below),
one or more new Notes (as requested by the holder thereof) in exchange therefor,
in an aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person as such
holder may request and shall be substantially in the form of Exhibit 1. Each
such new Note shall be dated and bear interest from the date to which interest
shall have been paid on the surrendered Note or dated the date of the
surrendered Note if no interest shall have been paid thereon. The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $100,000, provided that if necessary
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $100,000. Any transferee,
by its acceptance of a Note registered in its name (or the name of its nominee),
shall be deemed to have made the representation set forth in Section 6.2.

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Section 13.3.    Replacement of Notes. Upon receipt by the Company at the
address and to the attention of the designated officer (all as specified in
Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of
and the loss, theft, destruction or mutilation of any Note (which evidence shall
be, in the case of an Institutional Investor, notice from such Institutional
Investor of such ownership and such loss, theft, destruction or mutilation), and
(a)    in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser or another holder of a Note with a minimum net worth
of at least $50,000,000 or a Qualified Institutional Buyer, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory), or
(b)    in the case of mutilation, upon surrender and cancellation thereof,
within ten Business Days thereafter, the Company at its own expense shall
execute and deliver, in lieu thereof, a new Note, dated and bearing interest
from the date to which interest shall have been paid on such lost, stolen,
destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or
mutilated Note if no interest shall have been paid thereon.
Section 14.
PAYMENTS ON NOTES.

Section 14.1.    Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York City, New York at the principal office of
JPMorgan Chase Bank, N.A. in such jurisdiction. The Company may at any time, by
notice to each holder of a Note, change the place of payment of the Notes so
long as such place of payment shall be either the principal office of the
Company in such jurisdiction or the principal office of a bank or trust company
in such jurisdiction.
Section 14.2.    Home Office Payment. So long as any Purchaser or its nominee
shall be the holder of any Note, and notwithstanding anything contained in
Section 14.1 or in such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, Make-Whole Amount, if any, and interest
by the method and at the address specified for such purpose below such
Purchaser's name in Schedule A, or by such other method or at such other address
as such Purchaser shall have from time to time specified to the Company in
writing for such purpose, without the presentation or surrender of such Note or
the making of any notation thereon, except that upon written request of the
Company made concurrently with or reasonably promptly after payment or
prepayment in full of any Note, such Purchaser shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by a Purchaser or its nominee, such Purchaser will, at its
election, either endorse thereon the amount of principal paid thereon and the
last date to which interest has been paid thereon or surrender such Note to the
Company in exchange for a new Note or Notes pursuant to Section 13.2. The
Company will afford the benefits of this Section 14.2 to any Institutional
Investor that is the direct or indirect

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transferee of any Note purchased by a Purchaser under this Agreement and that
has made the same agreement relating to such Note as the Purchasers have made in
this Section 14.2.
Section 15.
EXPENSES, ETC.

Section 15.1.    Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys' fees of a special counsel and, if reasonably
required by the Required Holders, local or other counsel) incurred by the
Purchasers and each other holder of a Note in connection with such transactions
and in connection with any amendments, waivers or consents under or in respect
of this Agreement or the Notes (whether or not such amendment, waiver or consent
becomes effective), including, without limitation: (a) the costs and expenses
incurred in enforcing or defending (or determining whether or how to enforce or
defend) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of being a holder of
any Note, (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes and (c) the costs and expenses
incurred in connection with the initial filing of this Agreement and all related
documents and financial information with the SVO provided, that such costs and
expenses under this clause (c) shall not exceed $3,500. The Company will pay,
and will save each Purchaser and each other holder of a Note harmless from, all
claims in respect of any fees, costs or expenses, if any, of brokers and finders
(other than those, if any, retained by a Purchaser or other holder in connection
with its purchase of the Notes).
Section 15.2.    Survival. The obligations of the Company under this Section 15
will survive the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes, and the termination of
this Agreement.
Section 16.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

All representations and warranties contained herein shall survive the execution
and delivery of this Agreement and the Notes, the purchase or transfer by any
Purchaser of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any subsequent holder of a Note, regardless
of any investigation made at any time by or on behalf of such Purchaser or any
other holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant to this Agreement
shall be deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement and the Notes
embody the entire agreement and understanding between each Purchaser and the
Company and supersede all prior agreements and understandings relating to the
subject matter hereof.

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Section 17.
AMENDMENT AND WAIVER.

Section 17.1.    Requirements. This Agreement and the Notes may be amended, and
the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term
(as it is used therein), will be effective as to any Purchaser unless consented
to by such Purchaser in writing, and (b) no such amendment or waiver may,
without the written consent of the holder of each Note at the time outstanding
affected thereby, (i) subject to the provisions of Section 12 relating to
acceleration or rescission, change the amount or time of any prepayment or
payment of principal of, or reduce the rate or change the time of payment or
method of computation of interest or of the Make-Whole Amount on, the Notes,
(ii) change the percentage of the principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver, or (iii) amend
any of Sections 8, 11(a), 11(b), 12, 17 or 20.
Section 17.2.    Solicitation of Holders of Notes.
(a)    Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b)    Payment. The Company will not directly or indirectly pay or cause to be
paid any remuneration, whether by way of supplemental or additional interest,
fee or otherwise, or grant any security or provide other credit support, to any
holder of Notes as consideration for or as an inducement to the entering into by
any holder of Notes of any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted or other credit support concurrently provided, on the same
terms, ratably to each holder of Notes then outstanding even if such holder did
not consent to such waiver or amendment.
(c)    Consent in Contemplation of Transfer. Any consent made pursuant to this
Section 17 by a holder of Notes that has transferred or has agreed to transfer
its Notes to the Company, any Subsidiary or any Affiliate of the Company and has
provided or has agreed to provide such written consent as a condition to such
transfer shall be void and of no force or effect except solely as to such
holder, and any amendments effected or waivers granted or to be effected or
granted that would not have been or would not be so effected or granted but for
such consent (and the consents of all other holders of Notes that were acquired
under the same or similar conditions) shall be void and of no force or effect
except solely as to such holder.

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Section 17.3.    Binding Effect, etc. Any amendment or waiver consented to as
provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note. As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.
Section 17.4.    Notes Held by Company, etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.
Section 18.
NOTICES.

All notices and communications provided for hereunder shall be in writing and
sent (a) by telecopy if the sender on the same day sends a confirming copy of
such notice by a recognized overnight delivery service (charges prepaid), or (b)
by registered or certified mail with return receipt requested (postage prepaid),
or (c) by a recognized overnight delivery service (with charges prepaid). Any
such notice must be sent:
(i)    if to any Purchaser or its nominee, to such Purchaser or nominee at the
address specified for such communications in Schedule A, or at such other
address as such Purchaser or nominee shall have specified to the Company in
writing,
(ii)    if to any other holder of any Note, to such holder at such address as
such other holder shall have specified to the Company in writing, or
(iii)    if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of the Treasurer, or at such other address as
the Company shall have specified to the holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
Section 19.
REPRODUCTION OF DOCUMENTS.

This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to any Purchaser, may be

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reproduced by such Purchaser by any photographic, photostatic, electronic,
digital, or other similar process and such Purchaser may destroy any original
document so reproduced. The Company agrees and stipulates that, to the extent
permitted by applicable law, any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made by such Purchaser in the regular course of business) and
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence. This Section 19 shall not prohibit the
Company or any other holder of Notes from contesting any such reproduction to
the same extent that it could contest the original, or from introducing evidence
to demonstrate the inaccuracy of any such reproduction.
Section 20.
CONFIDENTIAL INFORMATION.

For the purposes of this Section 20, “Confidential Information” means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any person acting on such Purchaser's behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser, provided that such Purchaser may
deliver or disclose Confidential Information to (i) its directors, officers,
employees, agents, attorneys, trustees and affiliates (to the extent such
disclosure reasonably relates to the administration of the investment
represented by its Notes), (ii) its financial advisors and other professional
advisors who agree to hold confidential the Confidential Information
substantially in accordance with the terms of this Section 20, (iii) any other
holder of any Note, (iv) any Institutional Investor to which it sells or offers
to sell such Note or any part thereof or any participation therein (if such
Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which it offers to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or
the SVO or, in each case, any similar organization, or any nationally recognized
rating agency that requires access to information about such Purchaser's
investment portfolio, or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to such Purchaser, (x) in response to
any subpoena or other legal process, (y) in connection with any litigation to
which such Purchaser is a party or (z) if an Event of Default has occurred and
is continuing, to the extent such Purchaser may reasonably determine such
delivery and disclosure to be necessary or appropriate in the enforcement or for
the protection of the rights and remedies under such Purchaser's Notes and this
Agreement. Each holder of a Note,

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by its acceptance of a Note, will be deemed to have agreed to be bound by and to
be entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee), such holder will enter into an
agreement with the Company embodying the provisions of this Section 20.
Section 21.
SUBSTITUTION OF PURCHASER.

Each Purchaser shall have the right to substitute any one of its Affiliates as
the purchaser of the Notes that it has agreed to purchase hereunder, by written
notice to the Company, which notice shall be signed by both such Purchaser and
such Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice, any reference to such Purchaser in this Agreement (other than in
this Section 21), shall be deemed to refer to such Affiliate in lieu of such
original Purchaser. In the event that such Affiliate is so substituted as a
Purchaser hereunder and such Affiliate thereafter transfers to such original
Purchaser all of the Notes then held by such Affiliate, upon receipt by the
Company of notice of such transfer, any reference to such Affiliate as a
“Purchaser” in this Agreement (other than in this Section 21), shall no longer
be deemed to refer to such Affiliate, but shall refer to such original
Purchaser, and such original Purchaser shall again have all the rights of an
original holder of the Notes under this Agreement.
Section 22.
MISCELLANEOUS.

Section 22.1.    Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.
Section 22.2.    Payments Due on Non-Business Days. Anything in this Agreement
or the Notes to the contrary notwithstanding (but without limiting the
requirement in Section 8.4 that the notice of any optional prepayment specify a
Business Day as the date fixed for such prepayment), any payment of principal of
or Make-Whole Amount or interest on any Note that is due on a date other than a
Business Day shall be made on the next succeeding Business Day without including
the additional days elapsed in the computation of the interest payable on such
next succeeding Business Day; provided that if the maturity date of any Note is
a date other than a Business Day, the payment otherwise due on such maturity
date shall be made on the next succeeding Business Day and shall include the
additional days elapsed in the computation of interest payable on such next
succeeding Business Day.
Section 22.3.    Accounting Terms. All accounting terms used herein which are
not expressly defined in this Agreement have the meanings respectively given to
them in accordance with GAAP. Except as otherwise specifically provided herein,
(i) all computations made pursuant to this Agreement shall be made in accordance
with GAAP, and (ii) all financial statements shall be prepared in accordance
with GAAP.

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For purposes of determining compliance with the covenants contained in this
Agreement, any election by the Company to measure an item of Indebtedness using
fair value (as permitted by Accounting Standard Codification Topic No. 825-10-25
- Fair Value Option or any similar accounting standard) shall be disregarded and
such determination shall be made as if such election had not been made.
Section 22.4.    Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
Section 22.5.    Construction, etc. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
For the avoidance of doubt, all Schedules and Exhibits attached to this
Agreement shall be deemed to be a part hereof.
Section 22.6.    Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.
Section 22.7.    Governing Law. This Agreement shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York excluding choice‑of‑law principles of the law of such
State that would permit the application of the laws of a jurisdiction other than
such State.
Section 22.8.    Jurisdiction and Process; Waiver of Jury Trial. (a) The Company
irrevocably submits to the non-exclusive jurisdiction of any New York State or
federal court sitting in the Borough of Manhattan, The City of New York, over
any suit, action or proceeding arising out of or relating to this Agreement or
the Notes. To the fullest extent permitted by applicable law, the Company
irrevocably waives and agrees not to assert, by way of motion, as a defense or
otherwise, any claim that it is not subject to the jurisdiction of any such
court, any objection that it may now or hereafter have to the laying of the
venue of any such suit, action or proceeding brought in any such court and any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
(b)    The Company consents to process being served by or on behalf of any
holder of Notes in any suit, action or proceeding of the nature referred to in
Section 22.8(a) by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage

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prepaid, return receipt requested, to it at its address specified in Section 18
or at such other address of which such holder shall then have been notified
pursuant to said Section. The Company agrees that such service upon receipt
(i) shall be deemed in every respect effective service of process upon it in any
such suit, action or proceeding and (ii) shall, to the fullest extent permitted
by applicable law, be taken and held to be valid personal service upon and
personal delivery to it. Notices hereunder shall be conclusively presumed
received as evidenced by a delivery receipt furnished by the United States
Postal Service or any reputable commercial delivery service.
(c)    Nothing in this Section 22.8 shall affect the right of any holder of a
Note to serve process in any manner permitted by law, or limit any right that
the holders of any of the Notes may have to bring proceedings against the
Company in the courts of any appropriate jurisdiction or to enforce in any
lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.
(d)    THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR
WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN
CONNECTION HEREWITH OR THEREWITH.

* * * * *

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If you are in agreement with the foregoing, please sign the form of agreement on
a counterpart of this Agreement and return it to the Company, whereupon this
Agreement shall become a binding agreement between you and the Company.

Very truly yours,

Cleco Power LLC

By /s/ Darren J. Olagues
Darren J. Olagues
Senior Vice President, CFO & Treasurer

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Note Purchase Agreement

The foregoing is hereby
accepted and agreed to as
of the date thereof.
John Hancock Life Insurance Company (U.S.A.)

By
/s/ Gavin R. Danaher

Name: Gavin R. Danaher
Title: Managing Director

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Note Purchase Agreement

The foregoing is hereby
accepted and agreed to as
of the date thereof.
Thrivent Financial for Lutherans

By /s/ Alan D. Onstad
Name: Alan D. Onstad
Title: Senior Director

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Cleco Power LLC
 
Note Purchase Agreement

The foregoing is hereby
accepted and agreed to as
of the date thereof.
Pacific Life Insurance Company

By /s/ Darcy L. Lewis
Name: Darcy L. Lewis
Title: Assistant Vice President

By /s/ Bernard J. Dougherty
Name: Bernard J. Dougherty
Title: Assistant Secretary

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Note Purchase Agreement

The foregoing is hereby
accepted and agreed to as
of the date thereof.
ING Life Insurance and Annuity Company
ING USA Annuity and Life Insurance Company
ReliaStar Life Insurance Company
ReliaStar Life Insurance Company of New York

By: ING Investment Management LLC, as Agent

By /s/ Fitzhugh L. Wickham
Name: Fitzhugh L. Wickham
Title: Vice President

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Cleco Power LLC
 
Note Purchase Agreement

The foregoing is hereby
accepted and agreed to as
of the date thereof.
Connecticut General Life Insurance Company

By: CIGNA Investments, Inc. (authorized agent)

By /s/ Robert W. Eccles
Name: Robert W. Eccles
Title: Senior Managing Director

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Defined Terms
As used herein, the following terms have the respective meanings set forth below
or set forth in the Section hereof following such term:
“Affiliate” means, at any time, and with respect to any Person, any other Person
that at such time directly or indirectly through one or more intermediaries
Controls, or is Controlled by, or is under common Control with, such first
Person, and, with respect to the Company, shall include any Person beneficially
owning or holding, directly or indirectly, 10% or more of any class of voting or
equity interests of the Company or any Subsidiary or any corporation of which
the Company and its Subsidiaries beneficially own or hold, in the aggregate,
directly or indirectly, 10% or more of any class of voting or equity interests.
As used in this definition, “Control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. Unless the context otherwise clearly requires, any
reference to an “Affiliate” is a reference to an Affiliate of the Company.
“Anti-Terrorism Order” means Executive Order No. 13224 of September 24, 2001,
Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten
to Commit or Support Terrorism, 66 U.S. Fed. Reg. 49, 079 (2001), as amended.
“Anti‑Money Laundering Laws” is defined in Section 5.16(c).
“Bank Credit Agreement” means the $300,000,000 Credit Agreement dated as of
November 23, 2010, among Cleco Power LLC, as borrower, the lenders thereto,
JPMorgan Chase Bank, N.A., as administrative agent, Credit Agricole Corporate
and Investment Bank and Keybank National Association, as syndication agents,
JPMorgan Securities LLC, Credit Agricole Corporate and Investment Bank and
Keybank National Association, as co-lead arrangers and book runner, and Deutsche
Bank AG New York Branch and U.S. Bank National Association, as documentation
agents, as such agreement may be amended, supplemented, modified, renewed,
replaced, refunded or refinanced from time to time and any successor bank credit
facility which constitutes the primary bank credit facility of the Company.
“Blocked Person” is defined in Section 5.16(a).
“Business Day” means (a) for the purposes of Section 8.6 only, any day other
than a Saturday, a Sunday or a day on which commercial banks in New York City
are required or authorized to be closed, and (b) for the purposes of any other
provision of this Agreement, any day other than a Saturday, a Sunday or a day on
which commercial banks in New York, New York or New Orleans, Louisiana are
required or authorized to be closed.
“Capital Lease Obligations” means with respect to any Person, obligations of
such Person to pay rent or other amounts under any lease (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and

SCHEDULE B
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the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP, provided, however, no power purchase
agreement with an independent power producer or a power producer which is not an
Affiliate of the Company shall constitute a Capital Lease Obligation.
“Closing” is defined in Section 3.
“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time.
“Company” means Cleco Power LLC, a Louisiana limited liability company or any
successor that becomes such in the manner prescribed in Section 10.2.
“Confidential Information” is defined in Section 20.
“Controlled Entity” means any of the Subsidiaries of the Company and any of
their or the Company's respective Controlled Affiliates. As used in this
definition, “Control” means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
“Default” means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
“Default Rate” means that rate of interest that is the greater of (i) 2.0% per
annum above the rate of interest stated in clause (a) of the first paragraph of
the Notes or (ii) 2.0% over the rate of interest publicly announced by JPMorgan
Chase Bank, N.A. in New York, New York as its “base” or “prime” rate.
“Disqualified Stock” means any Equity Interest that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable at the option of the holder thereof), or upon the happening of any
event, matures (excluding any maturity as a result of an optional redemption by
the issuer thereof to the extent not prohibited by this Agreement) or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the unconditional sole option of the holder thereof (other than
solely for Equity Interests which do not constitute Disqualified Stock), in
whole or in part, on or prior to December 16, 2042. The term “Disqualified
Stock” shall also include any options, warrants or other rights that are
convertible into Disqualified Stock or that are redeemable at the option of the
holder, or required to be redeemed, prior to June 16, 2042.
“Electronic Delivery” is defined in Section 7.1(a).
“Environmental Laws” means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the

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protection of the environment or the release of any materials into the
environment, including but not limited to those related to Hazardous Materials.
“Equity Interest” means (i) shares of corporate stock, partnership interests,
limited
liability company membership interests, and any other interest that confers on a
Person the right to receive a share of the profits and losses of, or
distribution of assets of, the issuing Person, and (ii) all warrants, options or
other rights to acquire any Equity Interest set forth in clause (i) of this
defined term.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder from
time to time in effect.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that
is treated as a single employer together with the Company under section 414 of
the Code.
“Event of Default” is defined in Section 11.
“Excluded Subsidiary” means any Finsub or any Receivable SPC.
“Financial Statements” means the financial statements described on Schedule 5.5.
“Finsub” means each special purpose bankruptcy-remote Person that is a
wholly-owned (directly or indirectly) Subsidiary organized solely for the
purpose of engaging in a Securitization Financing authorized by a Securitization
Statute and a Securitization Financing Order and activities related thereto.
“Form 10‑K” is defined in Section 7.1(b).
“Form 10‑Q” is defined in Section 7.1(a).
“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States of America.
“Governmental Authority” means
(a)    the government of
(i)    the United States of America or any State or other political subdivision
thereof, or
(ii)    any other jurisdiction in which the Company or any Subsidiary conducts
all or any part of its business, or which asserts jurisdiction over any
properties of the Company or any Subsidiary, or

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(b)    any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government.
“Guaranty” means, with respect to any Person, any obligation (except the
endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a)    to purchase such indebtedness or obligation or any property constituting
security therefor;
(b)    to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or other
balance sheet condition or any income statement condition of any other Person or
otherwise to advance or make available funds for the purchase or payment of such
indebtedness or obligation;
(c)    to lease properties or to purchase properties or services primarily for
the purpose of assuring the owner of such indebtedness or obligation of the
ability of any other Person to make payment of the indebtedness or obligation;
or
(d)    otherwise to assure the owner of such indebtedness or obligation against
loss in respect thereof.
In any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
“Hazardous Material” means any and all pollutants, toxic or hazardous wastes or
other substances that might pose a hazard to health and safety, the removal of
which may be required or the generation, manufacture, refining, production,
processing, treatment, storage, handling, transportation, transfer, use,
disposal, release, discharge, spillage, seepage or filtration of which is or
shall be restricted, prohibited or penalized by any applicable law including,
but not limited to, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar
restricted, prohibited or penalized substances.
“Hedge Agreement” means any interest rate protection agreement, foreign currency
exchange agreement, commodity price protection agreement or other interest rate,
currency exchange rate or commodity price hedge, future, forward, swap, option,
cap, floor, collar or similar agreement or arrangement (including both physical
and financial settlement transactions).
“holder” means, with respect to any Note the Person in whose name such Note is
registered in the register maintained by the Company pursuant to Section 13.1.

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“Indebtedness” means as to any Person, at a particular time, all items which
constitute, without duplication, (i) indebtedness for borrowed money or the
deferred purchase price of property (excluding trade payables incurred in the
ordinary course of business and excluding any such obligations payable solely
through the Company's issuance of Equity Interests (other than the Disqualified
Stock and Equity Interests convertible into Disqualified Stock)), (ii)
indebtedness evidenced by notes, bonds, debentures or similar instruments, (iii)
obligations with respect to any conditional sale or title retention agreement,
(iv) indebtedness arising under acceptance facilities and the amount available
to be drawn under all letters of credit issued for the account of such Person
and, without duplication, all drafts drawn thereunder to the extent such Person
shall not have reimbursed the issuer in respect of the issuer's payment of such
drafts, (v) all liabilities secured by any Lien on any property owned by such
Person even though such Person has not assumed or otherwise become liable for
the payment thereof (other than statutory Liens and Liens described in clauses
(n), (o), (s) and (t) of the definition “Permitted Encumbrances”), provided that
the amount of such liabilities included for purposes of this definition will be
the amount equal to the lesser of the fair market value of such property and the
amount of the liabilities so secured, (vi) indebtedness in respect of
Disqualified Stock valued at the greater of its voluntary or involuntary maximum
fixed repurchase price plus accrued dividends, (vii) liabilities in respect of
any obligation (contingent or otherwise) to purchase, redeem, retire, acquire or
make any other payment in respect of any shares of equity securities or any
option, warrant or other right to acquire any shares of equity securities,
(viii) obligations under Capital Lease Obligations, and (ix) Guaranties of such
Person in respect of Indebtedness of others. Regardless of whether or not any
bonds or other obligations of the Company or any Subsidiary (including any
Finsub or Receivables SPC) in respect of any Securitization Financing or
Receivables Financing constitutes Indebtedness under GAAP, the Indebtedness and
other liabilities of such Finsub or Receivables SPC in respect of such bonds or
other obligations and any credit enhancement with respect thereto shall be taken
into account in calculating Indebtedness.
“Indenture” means the Indenture, dated as of October 1, 1988, as the same may be
amended, restated, supplemented or otherwise modified from time to time, between
the Company and The Bank of New York Mellon Trust Company, NA (f/k/a The Bank of
New York Trust Company, NA), as trustee.
“Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a
Note holding (together with one or more of its affiliates) more than 10% of the
aggregate principal amount of the Notes then outstanding, (c) any bank, trust
company, savings and loan association or other financial institution, any
pension plan, any investment company, any insurance company, any broker or
dealer, or any other similar financial institution or entity, regardless of
legal form, and (d) any Related Fund of any holder of any Note.
“Intellectual Property” means all copyrights, trademarks, servicemarks, patents,
trade names and service names.
“Lien” means, with respect to any Person, any mortgage, lien, pledge, charge,
security interest or other encumbrance, or any interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or

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Capital Lease, upon or with respect to any property or asset of such Person
(including in the case of stock, stockholder agreements, voting trust agreements
and all similar arrangements).
“LPSC” means Louisiana Public Service Commission.
“LPSC Order” is defined in Section 4.11.
“Make-Whole Amount” is defined in Section 8.6.
“Material” means material in relation to the business, operations, affairs,
financial condition, assets, properties, or prospects of the Company and its
Subsidiaries taken as a whole.
“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, affairs, financial condition, assets or properties of the Company
and its Subsidiaries taken as a whole, or (b) the ability of the Company to
perform its obligations under this Agreement and the Notes, or (c) the validity
or enforceability of this Agreement or the Notes.
“Memorandum” is defined in Section 5.3.
“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term
is defined in section 4001(a)(3) of ERISA).
“NAIC” means the National Association of Insurance Commissioners or any
successor thereto.
“Notes” is defined in Section 1.
“OFAC” is defined in Section 5.16(a).
“OFAC Listed Person” is defined in Section 5.16(a).
“OFAC Sanctions Program” means any economic or trade sanction that OFAC is
responsible for administering and enforcing. A list of OFAC Sanctions Programs
may be found at http://www.ustreas.gov/offices/enforcement/ofac/programs/.
“Officer's Certificate” means a certificate of a Senior Financial Officer or of
any other officer of the Company whose responsibilities extend to the subject
matter of such certificate.
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA or any successor thereto.
“Permitted Encumbrances” means:

(a)    Liens imposed by law for taxes, assessments or similar charges incurred
in the ordinary course of business that are not yet due or are being contested
in compliance with Section 9.4, provided that enforcement of such Liens is
stayed pending such contest;

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(b)    landlords', vendors', carriers', warehousemen's, mechanics',
materialmen's, contractors', repairmen's and other like Liens imposed by law,
arising in the ordinary course of business and securing obligations which are
not delinquent or are being contested, provided that enforcement of such Liens
is stayed pending such contest;

(c)    pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security laws or regulations (but not ERISA);

(d)    pledges and deposits to secure the performance of bids, trade contracts,
leases, purchase agreements, government contracts, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature, in
each case in the ordinary course of business, and other than promissory notes
and contracts for the repayment of borrowed money;

(e)    Liens (including contractual security interests) in favor of a financial
institution (including securities firms) encumbering deposit accounts or checks
or instruments for collection, commodity accounts or securities accounts
(including the right of set-off) at or held by such financial institution in the
ordinary course of its commercial business and which secure only liabilities
owed to such financial institution arising out of or resulting from its
maintenance of such account or otherwise are within the general parameters
customary in the financial industry;

(f)    maritime Liens arising by operation of law in the ordinary course of
business and securing obligations which are not delinquent or are being
contested, provided that enforcement of such Liens is stayed pending such
contest;

(g)    Liens in favor of customs and revenue authorities arising as a matter of
law to secure payment of custom duties in connection with the importation of
goods;

(h)    judgment liens in respect of judgments that do not constitute an Event of
Default under Section 11(j);

(i)    any interest of a lessor or licensor in property under an operating lease
under which the Company or any Subsidiary is lessee or licensee, and any
restriction or encumbrance to which the interest of such lessor or licensor is
subject;

(j)    Liens arising from filed UCC-1 financing statements relating solely to
leases not prohibited by this Agreement;

(k)    leases or subleases granted to others that do not materially interfere
with the ordinary conduct of business of the Company and its Subsidiaries;

(l)    licenses of Intellectual Property granted by the Company or any
Subsidiary in the ordinary course of business and not materially interfering
with the

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ordinary conduct of the business of the Company and its Subsidiaries;

(m)    easements, servitudes (contractual and legal), zoning restrictions,
rights of way, encroachments, minor defects and irregularities in title and
other similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations and do
not render title to such property unmarketable or materially interfere with the
ability of the Company and its Subsidiaries, as the case may be, to utilize
their respective properties for their intended purposes;

(n)    Liens securing obligations, neither assumed by the Company or any
Subsidiary nor on account of which the Company or any Subsidiary customarily
pays interest, upon real estate on which the Company or any Subsidiary has a
right-of-way, easement, franchise or other servitude or of which the Company or
any Subsidiary is the lessee, for the purpose of locating transmission and
distribution lines and related support structures, pipe lines, substations,
measuring stations, tanks, pumping or delivery equipment or similar equipment,
or service buildings incidental to any of the foregoing;

(o)    with respect to properties involved in the production of oil, gas and
other minerals, unitization and pooling agreements and orders, operating
agreements, royalties,
reversionary interests, preferential purchase rights, farmout agreements, gas
balancing agreements and other agreements, in each case that are customary in
the oil, gas and mineral production business in the general area of such
property and that are entered into in the ordinary course of business;

(p)    Liens in favor of Governmental Authorities encumbering assets acquired in
connection with a government grant program, and the right reserved to, or vested
in, any Governmental Authority by the terms of any right, power, franchise,
grant, license, or permit, or by any provision of law, to purchase, condemn,
recapture or designate a purchaser of any property;

(q)    Liens on any cash collateral for letters of credit issued under the Bank
Credit Agreement to the extent required thereunder (i) as a result of any such
letters of credit remaining outstanding after the termination of the Bank Credit
Agreement (other than for reasons related to any default or event of default or
similar event occurring under the Bank Credit Agreement) or (ii) in respect of a
defaulting lender's contractual participation interest in any such letters of
credit; provided that the aggregate amount of all cash collateral posted
pursuant to this subparagraph (q) shall not exceed 50% of the total lending
commitment in effect from time to time under the Bank Credit Agreement; and
provided, further, that Priority Debt does not at any time exceed 20% of Total
Assets;

(r)    customary Liens for the fees and expenses of trustees and escrow agents
pursuant to any indenture, escrow agreement or similar agreement establishing a
trust or escrow arrangement, and Liens on monies held by trustees in payment or
construction accounts under indentures;
    

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(s)    agreements for and obligations (other than repayment of borrowed money)
relating to the joint or common ownership, operation, and use of property,
including Liens under joint venture or similar agreements securing obligations
incurred in the conduct of operations or consisting of a purchase option, call
or right of first refusal with respect to the Equity Interests in such jointly
owned Person; and

(t)    Liens granted on cash or invested funds constituting proceeds of any sale
or disposition of property deposited into escrow accounts to secure
indemnification, adjustment of purchase price or similar obligations incurred in
connection with such sale or disposition, in an amount not to exceed the amount
of gross proceeds received from such sale or disposition.
“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, business entity or
Governmental Authority.
“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA)
subject to Title I of ERISA that is or, within the preceding five years, has
been established or maintained, or to which contributions are or, within the
preceding five years, have been made or required to be made, by the Company or
any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability.
“Priority Debt” means the sum of (i) all cash collateral posted pursuant to
subparagraph (q) of the definition of “Permitted Encumbrances” plus (ii)
outstanding Indebtedness secured by Liens pursuant to Section 10.5(m) plus (iii)
outstanding Indebtedness pursuant to Section 10.6(e); provided, however, that
with respect to the determination of Indebtedness secured by Liens pursuant to
Section 10.5(m), if the Notes have been equally and ratably secured as provided
in Section 10.5(m), then Indebtedness secured by Liens pursuant to Section
10.5(m) shall be excluded from the calculation of Priority Debt.
“property” or “properties” means, unless otherwise specifically limited, real or
personal property of any kind, tangible or intangible, choate or inchoate.
“PTE” is defined in Section 6.2(a).
“Purchaser” is defined in the first paragraph of this Agreement.
“Qualified Institutional Buyer” means any Person who is a “qualified
institutional buyer” within the meaning of such term as set forth in Rule
144A(a)(1) under the Securities Act.
“Receivables” means accounts receivables, payment intangibles, notes receivable,
rights to receive future payments and related rights of the Company or any of
its Subsidiaries, and any supporting obligations and other financial assets
related thereto (including all collateral securing such accounts receivables or
other assets, contracts and contract rights, all guarantees with respect
thereto, and all proceeds thereof) which are transferred, or in respect of which
security interests are granted, in one or more transactions that are customary
for asset securitizations of such Receivables.

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“Receivables Securitization” means any sale, grant or contribution, or series of
related sales, grants or contributions, by the Company or any of its
Subsidiaries of Receivables or interests therein (or purported sale, grant or
contribution) to a limited liability company, business trust or other entity,
where (a) the purchase of such Receivables or interests therein is funded in
whole or in part by the incurrence or issuance by the purchaser, grantee or any
successor entity of Indebtedness or securities that are to receive payments
from, or that represent interests in, the cash flow derived primarily from such
Receivables or interests therein (provided, however, that “Indebtedness” as used
in this clause (a) shall not include Indebtedness incurred by a Receivables SPC
owed to the Company or any of its Subsidiaries, as applicable, which
Indebtedness represents all or a portion of the purchase price or other
consideration paid by the Receivables SPC for such Receivables or interests
therein), (b) any representation, warranty, covenant, recourse, repurchase, hold
harmless, indemnity or similar obligations of the Company or any of its
Subsidiaries, as applicable (other than the Receivables SPC that is a party to
such transaction), in respect of Receivables or interests therein sold, granted
or contributed, or payments made in respect thereof, are customary for
transactions of this type, and do not prevent the characterization of the
transaction as a true sale under applicable laws (including debtor relief laws),
and (c) any representation, warranty, covenant, recourse, repurchase, hold
harmless, indemnity or similar obligations of a Receivables SPC in respect of
Receivables or interests therein sold, granted or contributed, or payments made
in respect thereof, are customary for transactions of this type.
“Receivables SPC” means a special purpose, bankruptcy-remote Person formed for
the sole and exclusive purpose of engaging in activities in connection with the
purchase, sale and financing of Receivables in connection with and pursuant to a
Receivables Securitization.
“Related Fund” means, with respect to any holder of any Note, any fund or entity
that (i) invests in Securities or bank loans, and (ii) is advised or managed by
such holder, the same investment advisor as such holder or by an affiliate of
such holder or such investment advisor.
“Required Holders” means, at any time, the holders of more than 50% in principal
amount of the Notes at the time outstanding (exclusive of Notes then owned by
the Company or any of its Affiliates).
“Responsible Officer” means any Senior Financial Officer and any other officer
of the Company with responsibility for the administration of the relevant
portion of this Agreement.
“SEC” shall mean the Securities and Exchange Commission of the United States, or
any successor thereto.
“Securities” or “Security” shall have the meaning specified in Section 2(1) of
the Securities Act.
“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.

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“Securitization Financing” means an issuance of any bonds, other evidence of
indebtedness or certificates of participation or beneficial interests that is
(i) issued by a Finsub and (ii) secured by the intangible property right to
collect charges for the recovery of specified costs and such other assets, if
any, of a Finsub.
“Securitization Financing Order” means an order of the applicable regulatory
Governmental Authority (such as the Louisiana Public Service Commission) which
allows for a securitization financing by the Company and/or a Finsub authorized
by a Securitization Statute.
“Securitization Statute” means any legislation, including, but not limited to,
the Louisiana Electric Utility Storm Recovery Securitization Act and the
Louisiana Electric Utility Investment Recovery Securitization Act, and/or any
order or regulation of the Louisiana Public Service Commission, that (i) is
enacted to facilitate the recovery of certain specified costs incurred by the
Company; (ii) authorizes the Company to apply for, and authorizes the applicable
regulatory Governmental Authority to issue, a financing order determining the
amount of specified costs the Company will be allowed to recover; (iii) provides
that pursuant to the financing order, the Company acquires an intangible
property right to charge, collect, and receive amounts necessary to provide for
the full recovery of the specified costs determined to be recoverable; (iv)
guarantees that the applicable regulatory Governmental Authority will not
rescind or amend the financing order, revise the amount of specified costs, or
in any way reduce or impair the value of the intangible property right, except
as may be contemplated by periodic adjustments authorized by such legislation,
order or regulation; (v) provides procedures assuring that the sale of the
intangible property right from the Company to a Finsub will be perfected under
applicable law as an absolute transfer of the Company's right, title, and
interest in such property, and (vi) authorizes the securitization of the
intangible property right to recover the fixed amount of specified costs through
the issuance of bonds, other evidences of indebtedness, or certificates of
participation or beneficial interest that are issued pursuant to an indenture,
contract or other agreement of the Company or a Finsub.
“Senior Financial Officer” means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
“Subsidiary” means, as to any Person, any other Person in which such first
Person or one or more of its Subsidiaries or such first Person and one or more
of its Subsidiaries owns sufficient equity or voting interests to enable it or
them (as a group) ordinarily, in the absence of contingencies, to elect a
majority of the directors (or Persons performing similar functions) of such
second Person, and any partnership or joint venture if more than a 50% interest
in the profits or capital thereof is owned by such first Person or one or more
of its Subsidiaries or such first Person and one or more of its Subsidiaries
(unless such partnership or joint venture can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
“Subsidiary” is a reference to a Subsidiary of the Company.
“SVO” means the Securities Valuation Office of the NAIC or any successor to such
Office.

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“Total Assets” means, at any time, the aggregate amount of assets of the Company
and its Subsidiaries at such time, as determined on a consolidated basis in
accordance with GAAP.
“Total Capitalization” means, at any time, the difference between (i) the sum of
each of the following at such time with respect to the Company and the
Subsidiaries determined on a consolidated basis in accordance with GAAP: (a)
preferred Equity Interests, plus (b) common Equity Interests and any premium on
Equity Interests thereon (as such term is used in the Financial Statements),
excluding accumulated other comprehensive income or loss, plus (c) retained
earnings, plus (d) Total Indebtedness, and (ii) stock of the Company acquired by
the Company and stock of a Subsidiary acquired by such Subsidiary, in each case
at such time, as applicable, determined on a consolidated basis in accordance
with GAAP.
“Total Indebtedness” means at any time, all Indebtedness (net of unamortized
premium and discount (as such term is used in the Financial Statements)) at such
time of the Company and the Subsidiaries, determined on a consolidated basis in
accordance with GAAP. Regardless of whether or not any bonds issued in
connection with a Securitization Financing, Receivables Securitization or other
obligations of the Company or any Subsidiary (including any Finsub and
Receivables SPC) in respect of a Securitization Financing or Receivables
Securitization constitutes Indebtedness under GAAP, the Indebtedness and other
liabilities of such Finsub or Receivables SPC in respect of such bonds and any
credit enhancement with respect thereto shall be taken into account in
calculating Total Indebtedness.
“USA Patriot Act” means United States Public Law 107-56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
“Utility Mortgage” means the Indenture of Mortgage, dated as of July 1, 1950,
made by the Company to Bank One Trust Company, NA, as Trustee, as amended and
supplemented from time to time.
“Wholly-Owned Subsidiary” means, at any time, any Subsidiary one hundred percent
of all of the equity interests (except directors' qualifying shares) and voting
interests of which are owned by any one or more of the Company and the Company's
other Wholly-Owned Subsidiaries at such time.

B-12

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[FORM OF NOTE]
Cleco Power LLC
5.12% SENIOR NOTE DUE DECEMBER 16, 2041

No. [_____]
 
 
 
[Date]
$[_______]
 
 
 
PPN 185508 A*9

For Value Received, the undersigned, Cleco Power LLC (herein called the
“Company”), a limited liability company organized and existing under the laws of
the State of Louisiana, hereby promises to pay to [____________], or registered
assigns, the principal sum of [_____________________] Dollars (or so much
thereof as shall not have been prepaid) on December 16, 2041, with interest
(computed on the basis of a 360-day year of twelve 30‑day months) (a) on the
unpaid balance hereof at the rate of 5.12% per annum from the date hereof,
payable semiannually, on the 16th day of June and December in each year,
commencing with the June or December next succeeding the date hereof, until the
principal hereof shall have become due and payable, and (b) to the extent
permitted by law, on any overdue payment of interest and, during the continuance
of an Event of Default, on such unpaid balance and on any overdue payment of any
Make‑Whole Amount, at a rate per annum from time to time equal to the greater of
(i) 7.12% or (ii) 2.0% over the rate of interest publicly announced by JPMorgan
Chase Bank, N.A. from time to time in New York, New York as its “base” or
“prime” rate, payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand).
Payments of principal of, interest on and any Make-Whole Amount with respect to
this Note are to be made in lawful money of the United States of America at such
place as the holder of this Note shall have designated as provided in the Note
Purchase Agreement referred to below.
This Note is one of a series of Senior Notes (herein called the “Notes”) issued
pursuant to the Note Purchase Agreement, dated as of December 16, 2011 (as from
time to time amended, the “Note Purchase Agreement”), between the Company and
the respective Purchasers named therein and is entitled to the benefits thereof.
Each holder of this Note will be deemed, by its acceptance hereof, to have
(i) agreed to the confidentiality provisions set forth in Section 20 of the Note
Purchase Agreement and (ii) made the representation set forth in Section 6.2 of
the Note Purchase Agreement. Unless otherwise indicated, capitalized terms used
in this Note shall have the respective meanings ascribed to such terms in the
Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase Agreement,
upon surrender of this Note for registration of transfer accompanied by a
written instrument of transfer duly executed, by the registered holder hereof or
such holder's attorney duly authorized in writing, a new Note for a like
principal amount will be issued to, and registered in the name of, the
transferee. Prior to due presentment for registration of transfer, the Company
may treat the

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person in whose name this Note is registered as the owner hereof for the purpose
of receiving payment and for all other purposes, and the Company will not be
affected by any notice to the contrary.
This Note is subject to optional prepayment, in whole or from time to time in
part, at the times and on the terms specified in the Note Purchase Agreement,
but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may
be declared or otherwise become due and payable in the manner, at the price
(including any applicable Make-Whole Amount) and with the effect provided in the
Note Purchase Agreement.
This Note shall be construed and enforced in accordance with, and the rights of
the Company and the holder of this Note shall be governed by, the law of the
State of New York excluding choice-of-law principles of the law of such State
that would permit the application of the laws of a jurisdiction other than such
State.

Cleco Power LLC

By
 

[Title]

B-2