Exhibit 10.3

 

ADMINISTRATION AGREEMENT

 

ADMINISTRATION AGREEMENT, dated as of March 6, 2008 (this “Administration
Agreement”), is by and between CLECO KATRINA/RITA HURRICANE RECOVERY FUNDING
LLC, a Louisiana limited liability company, as Issuer (the “Issuer”), and CLECO
POWER LLC, a Louisiana limited liability company (“Cleco Power”), as
Administrator (in such capacity, the “Administrator”).  Capitalized terms used
and not otherwise defined herein shall have the meanings assigned to such terms
in Appendix A to the Indenture more fully described below.

 

W I T N E S S E T H:

 

WHEREAS, the Issuer is issuing its 2008 Senior Secured Storm Recovery Bonds (the
“Bonds”)  pursuant to the Indenture, dated as of the date hereof and a First
Supplemental Indenture thereto, also dated as of the date hereof (the “First
Supplement”) (as amended, supplemented or otherwise modified and in effect from
time to time, the “Indenture”), between the Issuer and U.S. Bank National
Association, as the Trustee;

 

WHEREAS, the Issuer has entered into certain agreements in connection with the
issuance of the Bonds, including (i) the Indenture and the First Supplement,
(ii) the Storm Recovery Property Servicing Agreement, dated as of the date
hereof (the “Servicing Agreement”), between the Issuer and Cleco Power, as
Servicer, (iii) the Storm Recovery Property Sale Agreement, dated as of the date
hereof (the “Sale Agreement”), between the Issuer and Cleco Power, as Seller,
and (iv) the DTC Agreement relating to the Bonds (the Indenture, the First
Supplement, the Servicing Agreement, the Sale Agreement and the DTC Agreement,
as such agreements may be amended and supplemented from time to time, being
referred to hereinafter collectively as the “Initial Related Agreements”);

 

WHEREAS, pursuant to the Initial Related Agreements, the Issuer is required to
perform certain duties in connection with the Initial Related Agreements, the
Bonds and the Trust Estate pledged to the Trustee pursuant to the Indenture;

 

WHEREAS, the Issuer may from time to time enter into and be required to perform
certain duties under additional agreements similar to the Initial Related
Agreements (together with the Initial Related Agreements, the “Related
Agreements”);

 

WHEREAS, the Issuer has no employees, other than its officers, and does not
intend to hire any employees, and consequently desires to have the Administrator
perform certain of the duties of the Issuer referred to in the preceding clauses
and to provide such additional services consistent with the terms of this
Administration Agreement and the Related Agreements as the Issuer may from time
to time request; and

 

WHEREAS, the Administrator has the capacity to provide the services and the
facilities required thereby and is willing to perform such services and provide
such facilities for the Issuer on the terms set forth herein;

 

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

 

1.             DUTIES OF THE ADMINISTRATOR: MANAGEMENT SERVICES.  THE
ADMINISTRATOR HEREBY AGREES TO PROVIDE THE FOLLOWING CORPORATE MANAGEMENT
SERVICES TO THE ISSUER AND TO CAUSE THIRD PARTIES TO PROVIDE PROFESSIONAL
SERVICES REQUIRED FOR OR CONTEMPLATED BY SUCH SERVICES IN ACCORDANCE WITH THE
PROVISIONS OF THIS ADMINISTRATION AGREEMENT:

 

(I)            FURNISH THE ISSUER WITH ORDINARY CLERICAL, BOOKKEEPING AND OTHER
CORPORATE ADMINISTRATIVE SERVICES NECESSARY AND APPROPRIATE FOR THE ISSUER,
INCLUDING, WITHOUT LIMITATION, THE FOLLOWING SERVICES:

 

(A)          MAINTAIN AT THE PREMISES (AS DEFINED BELOW) GENERAL ACCOUNTING
RECORDS OF THE ISSUER (THE “ACCOUNT RECORDS”), SUBJECT TO YEAR-END AUDIT, IN
ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, SEPARATE AND APART
FROM ITS OWN ACCOUNTING RECORDS, PREPARE OR CAUSE TO BE PREPARED SUCH QUARTERLY
AND ANNUAL FINANCIAL STATEMENTS AS MAY BE NECESSARY OR APPROPRIATE AND ARRANGE
FOR YEAR-END AUDITS OF THE ISSUER’S FINANCIAL STATEMENTS BY THE ISSUER’S
INDEPENDENT ACCOUNTANTS;

 

(B)           PREPARE AND, AFTER EXECUTION BY THE ISSUER, FILE WITH THE
SECURITIES AND EXCHANGE COMMISSION (THE “COMMISSION”) AND ANY APPLICABLE STATE
AGENCIES DOCUMENTS REQUIRED TO BE FILED WITH THE COMMISSION AND ANY APPLICABLE
STATE AGENCIES, INCLUDING, WITHOUT LIMITATION, PERIODIC REPORTS REQUIRED TO BE
FILED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED;

 

(C)           PREPARE FOR EXECUTION BY THE ISSUER AND CAUSE TO BE FILED SUCH
INCOME, FRANCHISE OR OTHER TAX RETURNS OF THE ISSUER AS SHALL BE REQUIRED TO BE
FILED BY APPLICABLE LAW (THE “TAX RETURNS”) AND CAUSE TO BE PAID ON BEHALF OF
THE ISSUER FROM THE ISSUER’S FUNDS ANY TAXES REQUIRED TO BE PAID BY THE ISSUER
UNDER APPLICABLE LAW;

 

(D)          PREPARE OR CAUSE TO BE PREPARED FOR EXECUTION BY THE ISSUER’S
MANAGERS MINUTES OF THE MEETINGS OF THE ISSUER’S MANAGERS AND SUCH OTHER
DOCUMENTS DEEMED APPROPRIATE BY THE ISSUER TO MAINTAIN THE SEPARATE LIMITED
LIABILITY COMPANY EXISTENCE AND GOOD STANDING OF THE ISSUER (THE “COMPANY
MINUTES”) OR OTHERWISE REQUIRED UNDER THE RELATED AGREEMENTS (TOGETHER WITH THE
ACCOUNT RECORDS, THE TAX RETURNS, THE COMPANY MINUTES, THE ISSUER LLC AGREEMENT,
AND THE ISSUER ARTICLES OF ORGANIZATION, THE “ISSUER DOCUMENTS”); AND ANY OTHER
DOCUMENTS DELIVERABLE BY THE ISSUER THEREUNDER OR IN CONNECTION THEREWITH; AND

 

(E)           HOLD, MAINTAIN AND PRESERVE AT THE PREMISES (OR SUCH OTHER PLACE
AS SHALL BE REQUIRED BY ANY OF THE RELATED AGREEMENTS) EXECUTED COPIES (TO THE
EXTENT APPLICABLE) OF THE ISSUER DOCUMENTS AND OTHER DOCUMENTS EXECUTED BY THE
ISSUER THEREUNDER OR IN CONNECTION THEREWITH;

 

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(II)           TAKE SUCH ACTIONS ON BEHALF OF THE ISSUER, AS ARE NECESSARY OR
DESIRABLE FOR THE ISSUER TO KEEP IN FULL EFFECT ITS EXISTENCE, RIGHTS AND
FRANCHISES AS A LIMITED LIABILITY COMPANY UNDER THE LAWS OF THE STATE OF
LOUISIANA AND OBTAIN AND PRESERVE ITS QUALIFICATION TO DO BUSINESS IN EACH
JURISDICTION IN WHICH IT BECOMES NECESSARY TO BE SO QUALIFIED;

 

(III)          PROVIDE FOR THE ISSUANCE AND DELIVERY OF THE BONDS;

 

(IV)          PROVIDE FOR THE PERFORMANCE BY THE ISSUER OF ITS OBLIGATIONS UNDER
EACH OF THE RELATED AGREEMENTS, AND PREPARE, OR CAUSE TO BE PREPARED, ALL
DOCUMENTS, REPORTS, FILINGS, INSTRUMENTS, NOTICES, CERTIFICATES AND OPINIONS
THAT IT SHALL BE THE DUTY OF THE ISSUER TO PREPARE, FILE OR DELIVER PURSUANT TO
THE RELATED AGREEMENTS;

 

(V)           ENFORCE EACH OF THE RIGHTS OF THE ISSUER UNDER THE RELATED
AGREEMENTS, AT THE DIRECTION OF THE TRUSTEE;

 

(VI)          PROVIDE FOR THE DEFENSE, AT THE DIRECTION OF THE ISSUER’S
MANAGERS, OF ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST THE ISSUER OR
AFFECTING THE ISSUER OR ANY OF ITS ASSETS;

 

(VII)         PROVIDE OFFICE SPACE (THE “PREMISES”) FOR THE ISSUER AND SUCH
REASONABLE ANCILLARY SERVICES AS ARE NECESSARY TO CARRY OUT THE OBLIGATIONS OF
THE ADMINISTRATOR HEREUNDER, INCLUDING TELECOPYING, DUPLICATING AND WORD
PROCESSING SERVICES;

 

(VIII)        UNDERTAKE SUCH OTHER ADMINISTRATIVE SERVICES AS MAY BE
APPROPRIATE, NECESSARY OR REQUESTED BY THE ISSUER; AND

 

(IX)           PROVIDE SUCH OTHER SERVICES AS ARE INCIDENTAL TO THE FOREGOING OR
AS THE ISSUER AND THE ADMINISTRATOR MAY AGREE.

 

In providing the services under this Section 1 and as otherwise provided under
this Administration Agreement, the Administrator will not knowingly take any
actions on behalf of the Issuer which (i) the Issuer is prohibited from taking
under the Related Agreements, or (ii) would cause the Issuer to be in violation
of any federal, state or local law or the Issuer LLC Agreement.

 

2.             COMPENSATION.  AS COMPENSATION FOR THE PERFORMANCE OF THE
ADMINISTRATOR’S OBLIGATIONS UNDER THIS ADMINISTRATION AGREEMENT (INCLUDING THE
COMPENSATION OF PERSONS SERVING AS MANAGERS, OTHER THAN THE INDEPENDENT
MANAGERS, AND OFFICERS OF THE ISSUER, BUT, FOR THE AVOIDANCE OF DOUBT, EXCLUDING
THE PERFORMANCE BY CLECO POWER OF ITS OBLIGATIONS IN ITS CAPACITY AS SERVICER),
THE ADMINISTRATOR SHALL BE ENTITLED TO $100,000 ANNUALLY (THE “ADMINISTRATION
FEE”), PAYABLE BY THE ISSUER IN ARREARS PROPORTIONATELY ON EACH PAYMENT DATE.

 

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3.             THIRD PARTY SERVICES.  ANY SERVICES OR FEES REQUIRED FOR OR
CONTEMPLATED BY THE PERFORMANCE OF THE ABOVE-REFERENCED SERVICES BY THE
ADMINISTRATOR TO BE PROVIDED BY UNAFFILIATED THIRD PARTIES (INCLUDING
INDEPENDENT AUDITORS’ FEES AND COUNSEL FEES) MAY, IF PROVIDED FOR OR OTHERWISE
CONTEMPLATED BY ANY RELATED FINANCING ORDER ISSUED BY THE LPSC AND IF THE ISSUER
DEEMS IT NECESSARY OR DESIRABLE, BE ARRANGED BY THE ISSUER OR BY THE
ADMINISTRATOR AT THE DIRECTION (WHICH MAY BE GENERAL OR SPECIFIC) OF THE
ISSUER.  COSTS AND EXPENSES ASSOCIATED WITH THE CONTRACTING FOR SUCH THIRD-PARTY
SERVICES MAY BE PAID DIRECTLY BY THE ISSUER OR PAID BY THE ADMINISTRATOR AND
REIMBURSED BY THE ISSUER IN ACCORDANCE WITH SECTION 2, OR OTHERWISE AS THE
ADMINISTRATOR AND THE ISSUER MAY MUTUALLY ARRANGE.

 

4.             ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER.  THE
ADMINISTRATOR SHALL FURNISH TO THE ISSUER FROM TIME TO TIME SUCH ADDITIONAL
INFORMATION REGARDING THE TRUST ESTATE AS THE ISSUER SHALL REASONABLY REQUEST.

 

5.             INDEPENDENCE OF THE ADMINISTRATOR.  FOR ALL PURPOSES OF THIS
ADMINISTRATION AGREEMENT, THE ADMINISTRATOR SHALL BE AN INDEPENDENT CONTRACTOR
AND SHALL NOT BE SUBJECT TO THE SUPERVISION OF THE ISSUER WITH RESPECT TO THE
MANNER IN WHICH IT ACCOMPLISHES THE PERFORMANCE OF ITS OBLIGATIONS HEREUNDER. 
UNLESS EXPRESSLY AUTHORIZED BY THE ISSUER, THE ADMINISTRATOR SHALL HAVE NO
AUTHORITY, AND SHALL NOT HOLD ITSELF OUT AS HAVING THE AUTHORITY, TO ACT FOR OR
REPRESENT THE ISSUER IN ANY WAY AND SHALL NOT OTHERWISE BE DEEMED AN AGENT OF
THE ISSUER.

 

The work to be performed under this Administration Agreement is part of the
Issuer’s business and is an integral part of and is essential to the business
and operations of the Issuer.  For purposes of the Louisiana Worker’s
Compensation Act, the Issuer is deemed to be the statutory employer of the
Administrator’s employees who perform the services under this Administration
Agreement.  Although the Issuer is to be granted the protections that are
afforded a statutory employer under Louisiana law, this provision is included
for the sole purpose of establishing a statutory employer relationship between
the Issuer and the Administrator’s personnel within the meaning of La. R.S.
23:1061(A) and is not intended to create an employer / employee relationship as
between the Issuer and the Administrator’s personnel for any other purpose.  The
Administrator shall be and remain primarily responsible for the payment of
workers’ compensation benefits to the Administrator’s personnel and shall not be
entitled to seek contribution for any such payments from the Issuer, and the
Administrator further shall indemnify and hold harmless the Issuer and at the
Issuer’s option defend the Issuer for any payment to the Administrator’s
personnel of workers’ compensation benefits or from any claim for such benefits
or any other employee claim.

 

6.             NO JOINT VENTURE.  NOTHING CONTAINED IN THIS ADMINISTRATION
AGREEMENT (A) SHALL CONSTITUTE THE ADMINISTRATOR AND THE ISSUER AS PARTNERS OR
CO-MEMBERS OF ANY PARTNERSHIP, JOINT VENTURE, ASSOCIATION, SYNDICATE,
UNINCORPORATED BUSINESS OR OTHER SEPARATE ENTITY, (B) SHALL BE CONSTRUED TO
IMPOSE ANY LIABILITY AS SUCH ON EITHER OF THEM OR (C) SHALL BE DEEMED TO CONFER
ON EITHER OF THEM ANY EXPRESS, IMPLIED OR APPARENT AUTHORITY TO INCUR ANY
OBLIGATION OR LIABILITY ON BEHALF OF THE OTHER.

 

7.             OTHER ACTIVITIES OF ADMINISTRATOR.  NOTHING HEREIN SHALL PREVENT
THE ADMINISTRATOR OR ANY OF ITS MEMBERS, MANAGERS, OFFICERS, EMPLOYEES,
SUBSIDIARIES OR AFFILIATES FROM ENGAGING IN OTHER BUSINESSES OR, IN ITS SOLE
DISCRETION, FROM ACTING IN A SIMILAR CAPACITY AS AN ADMINISTRATOR

 

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FOR ANY OTHER PERSON OR ENTITY EVEN THOUGH SUCH PERSON OR ENTITY MAY ENGAGE IN
BUSINESS ACTIVITIES SIMILAR TO THOSE OF THE ISSUER.

 

8.             TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR. 
(A) THIS ADMINISTRATION AGREEMENT SHALL CONTINUE IN FORCE UNTIL THE PAYMENT IN
FULL OF THE BONDS AND ANY OTHER AMOUNT WHICH MAY BECOME DUE AND PAYABLE UNDER
THE INDENTURE, UPON WHICH EVENT THIS ADMINISTRATION AGREEMENT SHALL
AUTOMATICALLY TERMINATE.

 

(b)           Subject to Sections 8(e) and 8(f), the Administrator may resign
its duties hereunder by providing the Issuer with at least sixty (60) days’
prior written notice.

 

(c)           Subject to Sections 8(e) and 8(f), the Issuer may remove the
Administrator without cause by providing the Administrator with at least sixty
(60) days’ prior written notice.

 

(d)           Subject to Sections 8(e) and 8(f), at the sole option of the
Issuer, the Administrator may be removed immediately upon written notice of
termination from the Issuer to the Administrator if any of the following events
shall occur:

 

(I)            THE ADMINISTRATOR SHALL DEFAULT IN THE PERFORMANCE OF ANY OF ITS
DUTIES UNDER THIS ADMINISTRATION AGREEMENT AND, AFTER NOTICE OF SUCH DEFAULT,
SHALL FAIL TO CURE SUCH DEFAULT WITHIN TEN (10) DAYS (OR, IF SUCH DEFAULT CANNOT
BE CURED IN SUCH TIME, SHALL (A) FAIL TO GIVE WITHIN TEN (10) DAYS SUCH
ASSURANCE OF CURE AS SHALL BE REASONABLY SATISFACTORY TO THE ISSUER AND (B) FAIL
TO CURE SUCH DEFAULT WITHIN 30 DAYS THEREAFTER);

 

(II)           A COURT OF COMPETENT JURISDICTION SHALL ENTER A DECREE OR ORDER
FOR RELIEF, AND SUCH DECREE OR ORDER SHALL NOT HAVE BEEN VACATED WITHIN SIXTY
(60) DAYS, IN RESPECT OF THE ADMINISTRATOR IN ANY INVOLUNTARY CASE UNDER ANY
APPLICABLE BANKRUPTCY, INSOLVENCY OR OTHER SIMILAR LAW NOW OR HEREAFTER IN
EFFECT, OR SUCH COURT SHALL APPOINT A RECEIVER, LIQUIDATOR, ASSIGNEE, CUSTODIAN,
TRUSTEE, SEQUESTRATOR OR SIMILAR OFFICIAL FOR THE ADMINISTRATOR OR ANY
SUBSTANTIAL PART OF ITS PROPERTY OR ORDER THE WINDING-UP OR LIQUIDATION OF ITS
AFFAIRS; OR

 

(III)          THE ADMINISTRATOR SHALL COMMENCE A VOLUNTARY CASE UNDER ANY
APPLICABLE BANKRUPTCY, INSOLVENCY OR OTHER SIMILAR LAW NOW OR HEREAFTER IN
EFFECT, SHALL CONSENT TO THE ENTRY OF AN ORDER FOR RELIEF IN AN INVOLUNTARY CASE
UNDER ANY SUCH LAW, SHALL CONSENT TO THE APPOINTMENT OF A RECEIVER, LIQUIDATOR,
ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR OR SIMILAR OFFICIAL FOR THE
ADMINISTRATOR OR ANY SUBSTANTIAL PART OF ITS PROPERTY, SHALL CONSENT TO THE
TAKING OF POSSESSION BY ANY SUCH OFFICIAL OF ANY SUBSTANTIAL PART OF ITS
PROPERTY, SHALL MAKE ANY GENERAL ASSIGNMENT FOR THE BENEFIT OF CREDITORS OR
SHALL FAIL GENERALLY TO PAY ITS DEBTS AS THEY BECOME DUE.

 

The Administrator agrees that if any of the events specified in clauses (ii) or
(iii) of this Section 8(d) shall occur, it shall give written notice thereof to
the Issuer and the Trustee as soon as practicable but in any event within seven
(7) days after the happening of such event.

 

(e)           No resignation or removal of the Administrator pursuant to this
Section 8(e) shall be effective until a successor Administrator has been
appointed by the Issuer, and such successor

 

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Administrator has agreed in writing to be bound by the terms of this
Administration Agreement in the same manner as the Administrator is bound
hereunder.

 

(f)            The appointment of any successor Administrator shall be effective
only after satisfaction of the Rating Agency Condition with respect to the
proposed appointment.

 

9.             ACTION UPON TERMINATION, RESIGNATION OR REMOVAL.  PROMPTLY UPON
THE EFFECTIVE DATE OF TERMINATION OF THIS ADMINISTRATION AGREEMENT PURSUANT TO
SECTION 8(A), THE RESIGNATION OF THE ADMINISTRATOR PURSUANT TO SECTION 8(B) OR
THE REMOVAL OF THE ADMINISTRATOR PURSUANT TO SECTION 8(C) OR 8(D), THE
ADMINISTRATOR SHALL BE ENTITLED TO BE PAID A PRO-RATED PORTION OF THE ANNUAL FEE
DESCRIBED IN SECTION 2 HEREOF THROUGH THE DATE OF TERMINATION.  THE
ADMINISTRATOR SHALL FORTHWITH UPON SUCH TERMINATION PURSUANT TO
SECTION 8(A) DELIVER TO THE ISSUER ALL PROPERTY AND DOCUMENTS OF OR RELATING TO
THE TRUST ESTATE THEN IN THE CUSTODY OF THE ADMINISTRATOR.  IN THE EVENT OF THE
RESIGNATION OF THE ADMINISTRATOR PURSUANT TO SECTION 8(B) OR THE REMOVAL OF THE
ADMINISTRATOR PURSUANT TO SECTION 8(C) OR 8(D), THE ADMINISTRATOR SHALL
COOPERATE WITH THE ISSUER AND TAKE ALL REASONABLE STEPS REQUESTED TO ASSIST THE
ISSUER IN MAKING AN ORDERLY TRANSFER OF THE DUTIES OF THE ADMINISTRATOR.

 

10.           ADMINISTRATOR’S LIABILITY.  EXCEPT AS OTHERWISE PROVIDED HEREIN,
THE ADMINISTRATOR ASSUMES NO LIABILITY OTHER THAN TO RENDER OR STAND READY TO
RENDER THE SERVICES CALLED FOR HEREIN, AND NEITHER THE ADMINISTRATOR NOR ANY OF
ITS MEMBERS, MANAGERS, OFFICERS, EMPLOYEES, SUBSIDIARIES OR AFFILIATES SHALL BE
RESPONSIBLE FOR ANY ACTION OF THE ISSUER OR ANY OF THE MEMBERS, MANAGERS,
OFFICERS, EMPLOYEES, SUBSIDIARIES OR AFFILIATES OF THE ISSUER (OTHER THAN THE
ADMINISTRATOR ITSELF).  THE ADMINISTRATOR SHALL NOT BE LIABLE FOR NOR SHALL IT
HAVE ANY OBLIGATION WITH REGARD TO ANY OF THE LIABILITIES, WHETHER DIRECT OR
INDIRECT, ABSOLUTE OR CONTINGENT OF THE ISSUER OR ANY OF THE MEMBERS, MANAGERS,
OFFICERS, EMPLOYEES, SUBSIDIARIES OR AFFILIATES OF THE ISSUER (OTHER THAN THE
ADMINISTRATOR ITSELF).

 

11.           INDEMNITY.

 

(A)          SUBJECT TO THE PRIORITY OF PAYMENTS SET FORTH IN THE INDENTURE, THE
ISSUER SHALL INDEMNIFY THE ADMINISTRATOR, ITS MEMBERS, MANAGERS, OFFICERS,
EMPLOYEES AND AFFILIATES AGAINST ALL LOSSES, CLAIMS, DAMAGES, PENALTIES,
JUDGMENTS, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL EXPENSES
OF LITIGATION OR PREPARATION THEREFOR WHETHER OR NOT THE ADMINISTRATOR IS A
PARTY THERETO) WHICH ANY OF THEM MAY PAY OR INCUR ARISING OUT OF OR RELATING TO
THIS ADMINISTRATION AGREEMENT AND THE SERVICES CALLED FOR HEREIN; PROVIDED,
HOWEVER, THAT SUCH INDEMNITY SHALL NOT APPLY TO ANY SUCH LOSS, CLAIM, DAMAGE,
PENALTY, JUDGMENT, LIABILITY OR EXPENSE RESULTING FROM THE ADMINISTRATOR’S
NEGLIGENCE OR WILLFUL MISCONDUCT IN THE PERFORMANCE OF ITS OBLIGATIONS
HEREUNDER.

 

(B)          THE ADMINISTRATOR SHALL INDEMNIFY THE ISSUER, ITS MEMBERS,
MANAGERS, OFFICERS AND EMPLOYEES AGAINST ALL LOSSES, CLAIMS, DAMAGES, PENALTIES,
JUDGMENTS, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL EXPENSES
OF LITIGATION OR PREPARATION THEREFOR WHETHER OR NOT THE ISSUER IS A PARTY
THERETO)

 

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WHICH ANY OF THEM MAY INCUR AS A RESULT OF THE ADMINISTRATOR’S NEGLIGENCE OR
WILLFUL MISCONDUCT IN THE PERFORMANCE OF ITS OBLIGATIONS HEREUNDER.

 

12.           NOTICES.  ANY NOTICE, REPORT OR OTHER COMMUNICATION GIVEN
HEREUNDER SHALL BE IN WRITING AND ADDRESSED AS FOLLOWS:

 

(A)           IF TO THE ISSUER, TO:

 

Cleco Katrina/Rita Hurricane Recovery Funding LLC
2605 Hwy. 28 East
Office Number 12,
Pineville, Louisiana 71360-5226
Attention:  Manager

 

(B)           IF TO THE ADMINISTRATOR, TO:

 

Cleco Power LLC
2030 Donahue Ferry Road,
Pineville, Louisiana 71360-5226
Attention:  Treasurer

 

or to such other address as either party shall have provided to the other party
in writing.  Any notice required to be in writing hereunder shall be deemed
given if such notice is mailed by certified mail, postage prepaid, or
hand-delivered to the address of such party as provided above.

 

13.           AMENDMENTS.  THIS ADMINISTRATION AGREEMENT MAY BE AMENDED FROM
TIME TO TIME BY A WRITTEN AMENDMENT DULY EXECUTED AND DELIVERED BY EACH OF THE
ISSUER AND THE ADMINISTRATOR, PROVIDED THAT (I) THE RATING AGENCY CONDITION HAS
BEEN SATISFIED IN CONNECTION THEREWITH, (II) THE TRUSTEE SHALL HAVE CONSENTED
AND (III) IN THE CASE OF ANY AMENDMENT THAT INCREASES ONGOING FINANCING COSTS AS
DEFINED IN THE FINANCING ORDER, THE LPSC SHALL HAVE CONSENTED THERETO OR SHALL
BE CONCLUSIVELY DEEMED TO HAVE CONSENTED THERETO.  WITH RESPECT TO THE LPSC’S
CONSENT TO ANY AMENDMENT TO THIS ADMINISTRATION AGREEMENT,

 

(A)           THE ADMINISTRATOR MAY SUBMIT THE AMENDMENT TO THE LPSC BY
DELIVERING TO THE LPSC’S EXECUTIVE COUNSEL A WRITTEN REQUEST FOR SUCH CONSENT,
WHICH REQUEST SHALL CONTAIN:

 

(i)            a reference to Docket No. U-29157 and a statement as to the
possible effect of the amendment on ongoing financing costs;

 

(ii)           an Officer’s Certificate stating that the proposed amendment has
been approved by all parties to this Administration Agreement; and

 

(iii)          a statement identifying the person to whom the LPSC or its staff
is to address its consent to the proposed amendment.

 

(B)           ANY AMENDMENT REQUIRING THE CONSENT OF THE LPSC AS PROVIDED IN
THIS SECTION 13 SHALL BECOME EFFECTIVE ON THE LATER OF:

 

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(i)            the date proposed by the parties to the amendment, or

 

(ii)           31 days after such submission of the amendment to the LPSC unless
the LPSC issues an order disapproving the amendment within a 30-day period.

 

Following delivery of a notice to the LPSC by the Administrator under
Section 13(a) above, the Administrator and Issuer may at any time withdraw from
the LPSC further consideration of any notification of a proposed amendment.

 

14.           SUCCESSORS AND ASSIGNS.  THIS ADMINISTRATION AGREEMENT MAY NOT BE
ASSIGNED BY THE ADMINISTRATOR UNLESS SUCH ASSIGNMENT IS PREVIOUSLY CONSENTED TO
IN WRITING BY THE ISSUER AND THE TRUSTEE AND SUBJECT TO THE SATISFACTION OF THE
RATING AGENCY CONDITION IN CONNECTION THEREWITH.  ANY ASSIGNMENT WITH SUCH
CONSENT AND SATISFACTION, IF ACCEPTED BY THE ASSIGNEE, SHALL BIND THE ASSIGNEE
HEREUNDER IN THE SAME MANNER AS THE ADMINISTRATOR IS BOUND HEREUNDER. 
NOTWITHSTANDING THE FOREGOING, THIS ADMINISTRATION AGREEMENT MAY BE ASSIGNED BY
THE ADMINISTRATOR WITHOUT THE CONSENT OF THE ISSUER OR THE TRUSTEE TO A
CORPORATION OR OTHER ORGANIZATION THAT IS A SUCCESSOR (BY MERGER, CONSOLIDATION
OR PURCHASE OF ASSETS) TO THE ADMINISTRATOR; PROVIDED THAT SUCH SUCCESSOR
ORGANIZATION EXECUTES AND DELIVERS TO THE ISSUER AN AGREEMENT IN WHICH SUCH
CORPORATION OR OTHER ORGANIZATION AGREES TO BE BOUND HEREUNDER BY THE TERMS OF
SAID ASSIGNMENT IN THE SAME MANNER AS THE ADMINISTRATOR IS BOUND HEREUNDER. 
SUBJECT TO THE FOREGOING, THIS ADMINISTRATION AGREEMENT SHALL BIND ANY
SUCCESSORS OR ASSIGNS OF THE PARTIES HERETO.  UPON SATISFACTION OF ALL OF THE
CONDITIONS OF THIS SECTION 14, THE PRECEDING ADMINISTRATOR SHALL AUTOMATICALLY
AND WITHOUT FURTHER NOTICE BE RELEASED FROM ALL OF ITS OBLIGATIONS HEREUNDER.

 

15.           GOVERNING LAW.  THIS ADMINISTRATION AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF LOUISIANA, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

16.           HEADINGS.  THE SECTION HEADINGS HEREOF HAVE BEEN INSERTED FOR
CONVENIENCE OF REFERENCE ONLY AND SHALL NOT BE CONSTRUED TO AFFECT THE MEANING,
CONSTRUCTION OR EFFECT OF THIS ADMINISTRATION AGREEMENT.

 

17.           COUNTERPARTS.  THIS ADMINISTRATION AGREEMENT MAY BE EXECUTED IN
COUNTERPARTS, EACH OF WHICH WHEN SO EXECUTED SHALL BE AN ORIGINAL, BUT ALL OF
WHICH TOGETHER SHALL CONSTITUTE BUT ONE AND THE SAME ADMINISTRATION AGREEMENT.

 

18.           SEVERABILITY.  ANY PROVISION OF THIS ADMINISTRATION AGREEMENT THAT
IS PROHIBITED OR UNENFORCEABLE IN ANY JURISDICTION SHALL 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 NOT INVALIDATE OR RENDER UNENFORCEABLE SUCH PROVISION IN ANY
OTHER JURISDICTION.

 

19.           NONPETITION COVENANT.  NOTWITHSTANDING ANY PRIOR TERMINATION OF
THIS ADMINISTRATION AGREEMENT, THE ADMINISTRATOR COVENANTS THAT IT SHALL NOT,
PRIOR TO THE DATE WHICH IS ONE YEAR AND ONE DAY AFTER PAYMENT IN FULL OF THE
BONDS, ACQUIESCE, PETITION OR OTHERWISE INVOKE OR CAUSE THE ISSUER TO INVOKE THE
PROCESS OF ANY COURT OR GOVERNMENT AUTHORITY FOR THE

 

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PURPOSE OF COMMENCING OR SUSTAINING A CASE AGAINST THE ISSUER UNDER ANY FEDERAL
OR STATE BANKRUPTCY, INSOLVENCY OR SIMILAR LAW OR APPOINTING A RECEIVER,
LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR OR OTHER SIMILAR OFFICIAL
OF THE ISSUER OR ANY SUBSTANTIAL PART OF ITS PROPERTY, OR ORDERING THE WINDING
UP OR LIQUIDATION OF THE AFFAIRS OF THE ISSUER.

 

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IN WITNESS WHEREOF, the parties have caused this Administration Agreement to be
duly executed and delivered as of the day and year first above written.

 

 

 

CLECO KATRINA/RITA HURRICANE
RECOVERY FUNDING LLC,

 

 

as Issuer

 

 

 

 

 

By:

/s/ Keith D. Crump

 

 

Name: Keith D. Crump

 

 

Title: Vice President and Manager

 

 

 

 

 

CLECO POWER LLC,

 

 

as Administrator,

 

 

 

 

 

By:

/s/ Kathleen F. Nolen

 

 

Name: Kathleen F. Nolen

 

 

Title: Senior Vice President and Chief Financial Officer

 

10

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