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**EXHIBIT 10(u)**

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**CLECO CORPORATION**

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**DEFERREDCOMPENSATION TRUST**

 

 

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**CLECO CORPORATIONDEFERRED COMPENSATION TRUST**

**TABLE OF CONTENTS**

| ARTICLE I - DEFINITIONS                                                                                                                    | 1 |
|--------------------------------------------------------------------------------------------------------------------------------------------|---|
| ARTICLE II - STATUS OF TRUST                                                                                                               | 2 |
|             Title                                                                   | 2 |
|             Status of Trust                                                         | 2 |
|             Relationship to Plan                                                    | 2 |
| ARTICLE III - ESTABLISHMENT OF TRUST                                                                                                       | 2 |
|             Initial Contribution                                                    | 2 |
|             Additional Contributions                                                | 2 |
| ARTICLE IV - INVESTMENT POWERS OF TRUSTEE                                                                                                  | 3 |
|             Investment as Single Fund                                               | 3 |
|             Investment Powers                                                       | 3 |
|             Investment in Insurance                                                 | 3 |
|             Investment in Company Stock                                             | 4 |
|             Related Party Investments                                               | 4 |
|             Nominee                                                                 | 4 |
|             Liability for Investment Decisions                                      | 4 |
| ARTICLE V - DUTIES OF TRUSTEE                                                                                                              | 5 |
|             Reports                                                                 | 5 |
|             Tax Reporting                                                           | 5 |
|             Consultants, Advisors and Other Experts                                 | 5 |
|             Expenses                                                                | 5 |
|             Gains from Other Business                                               | 5 |
|             Instructions                                                            | 5 |
|             Plan Administration                                                     | 6 |
| ARTICLE VI - PAYMENTS AND DISTRIBUTIONS                                                                                                    | 6 |
|             Payments to Participants and Beneficiaries                              | 6 |
|             Insufficiency of Trust Assets; Payments by the  Company or an Affiliate | 6 |
|             Distributions to the Company or an Affiliate                            | 6 |
|             Taxes                                                                   | 6 |
| ARTICLE VII - INSOLVENCY OF COMPANY                                                                                                        | 7 |
|             Determination of Insolvency                                             | 7 |
|             Cessation of Payments                                                   | 7 |
|             Resumption of Payments                                                  | 8 |
|             Separate Application to Company and Affiliates                          | 8 |

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| ARTICLE VIII - CHANGE IN CONTROL                                                                                     | 8  |
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|             Determination of Change in Control                | 8  |
|             Additional Required Contribution                  | 8  |
|             Determination of Required Funding Amount          | 8  |
|             Claims for Benefits                               | 9  |
| ARTICLE IX - STATUS OF TRUST ASSETS                                                                                  | 9  |
|             General Assets of the Company and its  Affiliates | 9  |
|             Prohibition Against Assignment                    | 9  |
| ARTICLE X - RESIGNATION OR REMOVAL                                                                                   | 9  |
|             Resignation or Removal                            | 9  |
|             Successor Trustee                                 | 10 |
|             Transfer of Assets                                | 10 |
| ARTICLE XI - AMENDMENT AND TERMINATION                                                                               | 10 |
|             Amendment; Trust Irrevocable                      | 10 |
|             Termination                                       | 10 |
| ARTICLE XII - MISCELLANEOUS                                                                                          | 10 |
|             Severability                                      | 10 |
|             Governing Law                                     | 10 |
|             Hold Harmless                                     | 10 |
|             Notices                                           | 11 |
|             Fees and Expenses                                 | 11 |
|             Dispute Resolution                                | 11 |
|             Delegation                                        | 12 |

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**CLECO CORPORATIONDEFERRED COMPENSATION TRUST**

                        **THISTRUST AGREEMENT** (this "**Trust Agreement**") is made and entered into byCleco Corporation, a corporation organized and existing under the laws of theState of Louisiana (the "**Company**") on its behalf and on behalf of itsAffiliates (as defined below), and Bank One Trust Company, N.A. of Columbus,Ohio, a national banking association organized under the laws of the UnitedStates, with its principal place of business at Columbus, Ohio (the "**Trustee**");

                        **WHEREAS,**the Company maintains the Cleco Corporation Deferred Compensation Plan (the **"Plan"**),which plan is intended to benefit key executives, officers and directors of theCompany and its Affiliates and is a type of unfunded, nonqualified deferredcompensation arrangement for purposes of the Employee Retirement IncomeSecurity Act of 1974, as amended ("**ERISA**");

                        **WHEREAS**,the Company and its Affiliates have incurred or will incur certain benefitobligations under the Plan;

                        **WHEREAS**,the Company and its Affiliates now desire to establish a trust in order toaccumulate the funds necessary to satisfy such benefit obligations;

                        **NOW,THEREFORE,** the Company (acting on its behalf and on behalf of itsAffiliates) and the Trustee agree to create and administer a trust, subject tothe terms and conditions set forth below.

**ARTICLE IDEFINITIONS**

                        1.1       **Affiliate**means any corporation or other form of entity which is a member of acontrolled group of corporations or other entities with the Company, determinedfrom time to time, within the meaning of Code Section 1563, without regard tothe form of entity.

                        1.2       **Board**or **Board of Directors** means the Board of Directors of the Company. 

                        1.3       **Changein Control** means and shall be deemed to have occurred in accordance withthe definition of such term in the Cleco Corporation Deferred CompensationPlan, as the same may be amended from time to time.

                        1.4       **Code**means the Internal Revenue Code of 1986, as amended.

                        1.5       **Committee**means the committee appointed under the Plan.

                        1.6       **Plan**means the Cleco Corporation Deferred Compensation Plan, first effective as of August 1, 2000, as the same may be amended from time to time.

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                        1.7       **Trust**means the fund established and administered hereunder.

**                       **1.8       **Otherdefinitions**.  Unless otherwise specified in this Trust Agreement,capitalized terms used herein shall have the meanings ascribed to them in thePlan.

**ARTICLE IISTATUS OF TRUST**

                        2.1       **Title**. This Trust shall be known as the **Cleco Corporation Deferred CompensationTrust**; this Trust shall be effective as of February 1, 2001.

**                       **2.2**       Statusof Trust**.  The Trust is intended to be a grantor trust (a) with respect towhich the Company is deemed to be the grantor as defined in Subpart E, Part I,Subchapter J, Chapter 1, Subtitle A of the Code as to the portion of the Trustdeemed owned and/or contributed by the Company, and (b) with respect to whichan Affiliate is deemed to be the grantor as to any portion of the Trust deemedowned and/or contributed by such Affiliate.  The Committee (or its designee)shall maintain records sufficient to establish the allocation of the Trustcontemplated under this Paragraph 2.2.  

                        ThisTrust, together with the Plan, is intended to constitute an unfunded deferredcompensation arrangement for the benefit of a select group of management orhighly compensated employees within the meaning of Title I of ERISA. 

                        2.3       **Relationshipto Plan**.  Although the purpose of this Trust is to permit the Company andits Affiliates to accumulate amounts required to satisfy its obligation underthe Plan, no Participant or other person claiming an interest in the Plan shallhave a claim or other ownership interest, whether direct or indirect, in anyasset comprising the Trust, except as an unsecured general creditor of theCompany or an Affiliate.  The establishment of this Trust shall not be deemedto create a fiduciary relationship between either the Company, including itsAffiliates, or the Trustee and any Participant or other person.

**ARTICLE IIIESTABLISHMENT OF TRUST**

                        3.1       **InitialContribution**.  Upon the execution of this Trust Agreement, the Companyand/or its Affiliates shall deliver to the Trustee an initial principalcontribution in the form of cash.  Upon execution of this Trust Agreement, theTrustee shall be deemed to have accepted the Trust and agreed to hold theassets comprising the Trust subject to the terms and conditions of this TrustAgreement.

                        3.2       **AdditionalContributions**. The Company and its Affiliates, in their sole discretion,may contribute additional amounts to the Trust, from time to time.  Neither theTrustee nor any Participant or beneficiary shall have the right to compel anysuch contribution.

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**ARTICLEIVINVESTMENT POWERS OF TRUSTEE**

                        4.1       **Investmentas Single Fund**.  Notwithstanding any provision of this Trust Agreement tothe contrary, contributions by the Company (including its Affiliates), togetherwith any accumulation, accrual, earnings or income, shall constitute a singlefund to be held by the Trustee and invested in accordance with the terms ofthis Trust; provided, however, that the Trustee shall establish one or more subtrustsor other segregated accounts or otherwise earmark investments as directed by theCommittee and specifically invest and administer such subtrust, account orinvestments in accordance with the instructions of the Committee.

                        4.2       **InvestmentPowers**.  The Trustee shall serve as a directed trustee hereunder and shallpossess the power and authority granted under the Louisiana Trust Code, butshall act in accordance with the instructions of the Committee (or itsdesignee).  The Trustee shall invest and reinvest the assets comprising theTrust in such financial instruments, including stocks, bonds, mortgages andother evidence of indebtedness, insurance or other property, whether real orpersonal, as the Committee (or its designee) directs; in connection with theexercise of such powers, the Trustee shall have the power and authority to:

                        a.         Vote any security held in the Trustin accordance with the instructions of the Committee;

                       b.         Purchase any security, including anyequity security issued by the Company, from any individual or entity(including, without limitation, the Company or any shareholder of the Company)either on an established market or directly from such individual or entity, allin accordance with the instructions of the Committee;

                        c.         Exercise any conversion privilege orsubscription right available in connection with any property held by the Trust;

                      d.         Transfer assets comprising the Trustto a successor trustee in accordance with the written instructions of theCommittee; and

                        e.         Make, execute and deliver, asTrustee, any note, bond, guarantee, conveyance, contract, waiver, release orother instrument necessary or proper for the accomplishment of the investmentpowers set forth in this Paragraph 4.2.

Notwithstanding the generality ofthe foregoing, if the Committee directs the Trustee to create subtrusts,segregate accounts or otherwise earmark a portion of the Trust in accordancewith Paragraph 4.1 hereof for the benefit of the Company or a specificAffiliate, the power and authority granted hereunder shall be exercisedseparately in accordance with the instructions of the Committee with respect tosuch trust, account or investment.

                        4.3       **Investmentin Insurance**.  In addition to the power and authority granted to theTrustee in Paragraph 4.2 hereof, the Committee may direct the Trustee to assumeand/or 

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acquire one or more insurancepolicies on the life of any Participant or other person designated by theCommittee.  The Trustee shall have no responsibility to review the policy orthe creditworthiness of the issuer thereof at any time, or from time to time,or to determine the amount of premium to be paid.  The Trustee shall be theowner and beneficiary of any such policy, except that the Trustee shallexercise the rights of ownership with respect to such policy solely inaccordance with the instructions of the Committee (or its designee); suchrights shall include, but not be limited to, the right to name a beneficiaryother than the Trustee, to assign or liquidate the policy, to convert thepolicy, or to borrow against the policy for any purpose.  Premiums payable withrespect to any policy acquired hereunder shall be paid by the Company (or itsAffiliates) or by the Trustee in accordance with the instructions of theCommittee.

                        4.4       **Investmentin Company Stock**.  In addition to the power and authority granted to theTrustee in accordance with Paragraph 4.2 hereof, the Committee may direct theTrustee to establish a company stock fund hereunder.  In such event, theTrustee shall acquire, retain and dispose of company stock in accordance withthe directions of and procedures established by the Committee.   

                        4.5       **RelatedParty Investments**.  Notwithstanding any provision of this Trust Agreementto the contrary and subject to the provisions of Paragraph 4.2 hereof, theTrustee shall be entitled to hold all or any portion of the assets comprisingthe Trust in any certificate of deposit or other form of interest-bearingaccount offered by the Trustee or any of its banking affiliates, provided thatthe rate of interest available under any such account is at least as favorableas the rate of interest available with respect to similar accounts offered tothe public, or any mutual fund (whether open-end or closed-end) sponsored by oraffiliated with the Trustee.  In addition, the Trustee may invest all or anyportion of the assets comprising the Trust in common or preferred stock or anyform of debt issued the Company or any of its Affiliates. ** **

                        4.6       **Nominee**. The Trustee may register any security or other property held by it in its ownname or in the name of its nominee, including the nominee of any system for thecentral handling of stock, with or without the addition of words indicatingthat such stock is held in a fiduciary capacity.  The Trustee may hold anysecurity in bearer form.  The books and records of the Trustee shall, at alltimes, show that all such investments are part of the Trust.  Notwithstandingthe foregoing, the Trustee shall, at all times, remain responsible for the safecustody and disposition of the assets comprising the Trust.

                        4.7       **Liabilityfor Investment Decisions**.  The parties hereto acknowledge that the powerand authority granted to the Trustee hereunder shall be exercised pursuant tothe directions of the Committee (or its designee), and that the Trustee shallhave no right or obligation to review any such direction, to determine whetherany such direction is consistent with the terms of this Trust Agreement,applicable law or the Plan.  The Trustee shall be fully protected for acting orfailing to act in accordance with such directions.

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**ARTICLEVDUTIES OF TRUSTEE**

                        5.1       **Reports**. The Trustee shall keep accurate and detailed records of all investments,receipts, disbursements and all other transactions required to be made,including such specific records as shall be agreed upon in writing between theCompany and the Trustee.  Within 90 days following the close of each calendaryear and within 90 days after the removal or resignation of the Trustee, theTrustee shall deliver to the Company a written account of its administration ofthe Trust for such year or shorter period.  Any such accounting shall includeall investments, receipts, disbursements and other transactions effected by it,including a description of all securities and investments purchased and sold,and showing all cash, securities and other property held in the Trust. 

                        5.2       **TaxReporting**.  The Trustee shall file such returns and pay such taxes as maybe required under applicable law or the Company shall cause any such returns tobe prepared and filed in a manner satisfactory to the Trustee.

                        5.3       **Consultants,Advisors and Other Experts**.  The Trustee may consult with legal counsel(who may also be counsel for the Company generally) with respect to any of itsduties or obligations hereunder.  The Trustee may hire agents, accountants,actuaries, investment advisors, financial consultants or other professionals toassist it in performing any of its duties or obligations hereunder.

                        5.4       **Expenses**. The Company shall pay directly the fees and expenses incurred by the Trustee inconnection with the administration of this Trust.  If the Company does not paysuch expenses within 30 days of receipt of an invoice, the Trustee may chargesuch expenses against the Trust and is hereby granted a lien on the assets ofthe Trust for such payment.  

                        5.5       **Gainsfrom Other Business**.  Notwithstanding any powers granted to the Trusteepursuant to this Trust Agreement or applicable law, the Trustee shall not bedeemed to possess any power that could give this Trust the objective ofcarrying on a business and dividing the gains therefrom, within the meaning ofCode Section 7701 and Treas. Reg. §301.7701-2.

                        5.6       **Instructions**. All communications from the Company, the Committee (or any designee thereof)shall be in writing, signed by an officer of the Company or by an individualauthorized to act on behalf of the Company, the Committee or its designee, asthe case may be.  Instructions may also be delivered by facsimile or suchadditional electro-mechanical means, including, without limitation, e-mail instructions,as may be agreed upon by the parties hereto.  Instructions may be given asstanding instructions. 

                        TheTrustee shall be fully protected in relying on any such communication, and theTrustee shall not be required to verify the accuracy or validity of suchcommunication,  unless it has reasonable ground to doubt the authenticity ofany signature.  If the Trustee does not receive instructions from the Companyor the Committee after a request, the Trustee shall act or refrain from actingas it may determine to be appropriate or necessary.

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                        5.7       **PlanAdministration**.  Notwithstanding any provision of this Trust Agreement orthe Plan to the contrary, the Trustee shall have no duty or obligation toadminister the Plan, including, without limitation, the duty to ensure that anydirection given by the Committee (or a designee) hereunder is in accordancewith the terms of the Plan.

**ARTICLEVIPAYMENTS AND DISTRIBUTIONS**

                        6.1       **Paymentsto Participants and Beneficiaries**.  The determination of whether a Participantor beneficiary is entitled to benefits under the Plan shall be made inaccordance with the terms of the Plan.  Except as provided in Article VIIhereof, payments from the Trust by the Trustee shall be made to Participantsand beneficiaries in such manner, at such times, and in such amounts as theCommittee shall direct.

                        Notwithstandingany provision of this Trust Agreement or the Plan to the contrary, theCommittee may determine that all or any portion of each payment is attributableto the Company and/or an Affiliate and direct the Trustee to satisfy suchpayment obligation by the liquidation and disbursement of any investment, trustor account maintained exclusively for the Company and/or such Affiliatehereunder.

                        6.2       **Insufficiencyof Trust Assets; Payments by the Company or an Affiliate**.  In the event theassets of the Trust are not sufficient to satisfy the Company's benefitobligations (or the separate benefit obligations of an Affiliate) under thePlan, the Trustee shall have no liability with respect to the amount of anysuch insufficiency, and the Company (or the affected Affiliate) shall remit theamount of any such insufficiency (a) to the Trustee at least 10 business daysbefore any affected benefit becomes due and payable, or (b) directly to anyParticipant or beneficiary from its general assets as the affected benefitbecomes due and payable.  The Company (or Affiliate), in its discretion, maypay directly to any Participant or beneficiary the amount of any benefit dueunder the Plan, in lieu of payment by the Trustee hereunder.  Notwithstandingany provision of the Plan or this Trust Agreement to the contrary, any propertysegregated and maintained for the benefit of the Company shall be appliedsolely to satisfy the benefit obligations of the Company; any propertysegregated and maintained for the benefit of an Affiliate shall be applied tosatisfy the benefit obligations of such Affiliate.

                        6.3       **Distributionsto the Company or an Affiliate**.  Neither the Company, an Affiliate nor theCommittee shall have the right or power to direct the Trustee to return to theCompany or Affiliate, as the case may be, all or any portion of the assetscomprising the Trust before the Company's (or Affiliate's) obligation to paybenefits under the Plan has been satisfied, in full.  Upon such satisfaction,which shall be certified to the Trustee by the Committee, the Trustee shalldistribute to the Company or the affected Affiliate the excess assets, if any, thenheld in Trust; provided, however, that any assets deemed owned or contributedby the Company or an Affiliate, as the case may be, shall revert solely to suchentity.

                        6.4       **Taxes**. Notwithstanding any provision of the Plan or this Trust Agreement to thecontrary, the Trustee shall, in accordance with the instructions of the Companyor the Committee, withhold and remit from any distribution the amount of anytax determined to 

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be due and payable.  TheCommittee shall furnish the Trustee with such information as may be reasonablyrequired to compute and remit the amount of any such tax.

                        Notwithstandingany provision of this Trust Agreement to the contrary, provision for thepayment of any tax required to be withheld may be made by (a) deduction fromamounts otherwise distributable to a Participant or beneficiary hereunder, or(b) remittance by a Participant to the Company (or an Affiliate) or theTrustee, as the case may be, of such amounts as may be required to satisfy suchliability.

**ARTICLEVIIINSOLVENCY OF COMPANY**

                        7.1       **Determinationof Insolvency**.  For purposes of this Article VII, the Company shall bedeemed "**Insolvent**" or an "**Insolvency**" shall be deemed to haveoccurred if (a) the Company is unable to pay its debts as they become due, or(b) the Company is subject to a pending proceeding as a debtor under the UnitedStates Bankruptcy Code.

                        The Boardof Directors and/or the Chief Executive Officer of the Company shall have aduty to inform the Trustee, in writing, of the occurrence of the Company'sInsolvency.  If any person claiming to be a creditor of the Company alleges, inwriting, to the Trustee that the Company has become Insolvent, the Trusteeshall independently determine whether an Insolvency has occurred, and pendingsuch determination, the Trustee shall discontinue payment of benefits toParticipants or their beneficiaries.

                        Unlessthe Trustee has actual knowledge of the Company's Insolvency, or has receivednotice from the Company (as provided in Paragraph 12.4 hereof) or a personclaiming to be a creditor alleging that the Company is Insolvent, the Trusteeshall have no duty to inquire.  The Trustee may rely on such evidenceconcerning the Company's Insolvency as may be furnished to Trustee and thatprovides the Trustee with a reasonable basis for making a determination concerningthe Company's Insolvency.  Trustee shall not be considered to have actualknowledge or to have received notice of the Company's Insolvency unless anduntil knowledge or notice is received by:

                        a.         The individual, or his successor,last identified in writing by the Trustee as the proper party to receive suchnotices;

                      b.         The individuals held out to theCompany as being responsible for the day to day administration of this TrustAgreement; or 

                        c.         The manager of the department inwhich the individuals described in Paragraph 7.1b herein perform their dutieswith respect to this Trust Agreement.

                        7.2       **Cessationof Payments**.  If, at any time, the Trustee determines that the Company isInsolvent, then notwithstanding any provision of this Trust Agreement to thecontrary, the Trustee shall immediately discontinue all payments toParticipants and beneficiaries 

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and shall hold the assets thencomprising the Trust for the benefit of the Company's general creditors. 

                        7.3       **Resumptionof Payments.**  The Trustee shall resume the payment of benefits from theTrust after the Trustee has determined that the Company is not Insolvent (or isno longer Insolvent).  If the Trustee discontinues the payment of benefits fromthe Trust and subsequently resumes such payments, the first payment followingsuch discontinuance may include the aggregate amount of all benefits ordistributions due for the period of such discontinuance, reduced by theaggregate amount of any benefits paid by the Company during such period.

                        7.4       **SeparateApplication to Company and Affiliates.**  The provisions of this Article VIIshall apply separately to the Company and each of its Affiliates, subject tothe following rules:

                        a.         The Committee shall notify theTrustee as to whether any Affiliate is Insolvent within the meaning ofParagraph 7.1 hereof.

                        b.        The Committee shall designate theportion of the Trust constituting the property of such Affiliate, taking intoaccount the separate allocation rules described in Paragraph 4.1 hereof, andthe Trustee shall apply the provisions of this Article VII solely with respectto such property.

                        c.         The provisions ofParagraphs 7.2 and 7.3 hereof shall apply separately with respect to theportion of any benefit separately allocable to the Company or an Affiliate, asthe case may be.  The Committee shall make any such allocation.

**ARTICLE VIIICHANGE IN CONTROL**

                        8.1       **Determinationof Change in Control**.  The determination of whether a Change in Control hasoccurred shall be made in accordance with the terms of the Cleco CorporationDeferred Compensation Plan.  The Committee shall promptly inform the Trustee,in writing, of any such determination.** **

**                       **8.2       **AdditionalRequired Contribution**.  Upon the occurrence of a Change in Controlhereunder, the Company (and/or its Affiliates) shall contribute to the Trust anamount which (when aggregated with the assets then held in Trust) is equal tothe Required Funding Amount (as defined below).  Such contribution shall bemade as soon as practicable, but in no event later than 30 business daysfollowing the occurrence of the Change in Control and without the necessity offurther approval or consent.

                        8.3       **Determinationof Required Funding Amount**.  The "Required Funding Amount" shall bedetermined as the sum of (a) the present value of the maximum benefits in whichall Participants (and/or their beneficiaries) would be vested pursuant to theterms of the 

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Plan as of the date on which theChange in Control occurs (determined as if any vesting required upon a Changein Control occurred and taking into account any additional benefit accrualsrequired on account of a Change in Control), plus (b) a reasonable reserve forthe expenses of the Trust (such estimate not to exceed 1% of the present valueof benefits under the Plan).  

                        TheRequired Funding Amount shall be determined by Watson Wyatt Worldwide or suchother independent actuary as the Committee may designate.  The Trustee shall beentitled to rely upon the calculation of such contribution and shall have noresponsibility to determine whether the amount of such contribution isconsistent with the provisions of this Paragraph 8.3 or the terms of the Plan.

                        8.4       **Claimsfor Benefits**.   Upon the occurrence of a Change in Control, Participants(and their beneficiaries) shall have the right to submit claims for benefitsdirectly to the Trustee.  The Trustee shall not be required to independentlydetermine the validity or accuracy of any such benefit claims, but shall submitsuch claims to Watson Wyatt Worldwide or such other independent actuary as theCommittee may designate, and the Trustee shall make payments in accordance withthe determinations made by such actuary.  

**ARTICLE IXSTATUS OF TRUST ASSETS**

                        9.1       **GeneralAssets of the Company and its Affiliates**.  Notwithstanding any provision ofthis Trust Agreement to the contrary, the assets comprising the Trust shall, atall times, be assets of the Company and its Affiliates available to satisfy theobligations of the Company's (and Affiliates') general creditors in the eventof the Company's or Affiliates' Insolvency.

                        9.2       **ProhibitionAgainst Assignment**.  No interest, expectancy, benefit, payment, claim orright of a Participant (or any beneficiary), if any, in the assets comprisingthe Trust shall be subject in any manner (whether direct or indirect) to anyclaim, alienation by anticipation, sale, transfer, assignment, bankruptcy,pledge, attachment, charge or encumbrance of any kind by such Participant (orbeneficiary).  If any person shall attempt to take an action contrary to thisParagraph 9.2, such action shall be null and void and of no effect.

**ARTICLEXRESIGNATION OR REMOVAL**

                        10.1     **Resignationor Removal**.  The Trustee may resign at any time by delivery to theCommittee written notice of such resignation, which resignation shall not takeeffect less than 60 days after receipt of such notice, unless such notice iswaived by the Committee.

                        TheCommittee shall have the right to remove the Trustee at any time, whether withor without cause, by delivering to the Trustee written notice of such removal,which removal shall not take effect less than 60 days after delivery, unlesssuch notice is waived by the Trustee.

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                        10.2     **SuccessorTrustee**.  If the Trustee resigns or is removed, a successor trustee shallbe appointed by the Committee.  If no such appointment has been made, theTrustee may apply to a court of competent jurisdiction for appointment of asuccessor or for instructions.  Any successor trustee appointed hereunder shallbe an independent bank or trust company organized under the laws of the UnitedStates or any jurisdiction thereof or other independent party that is grantedcorporate trustee powers under state law, having a combined capital and surplusof at least $5,000,000,000.

                        10.3     **Transferof Assets**.  Upon the effective date of resignation or removal of theTrustee and appointment of a successor trustee, or such later date as theCommittee shall agree to,  all assets shall be transferred to the successortrustee, provided that prior to delivery and release of the Trust assets fullpayment has been made to the Trustee of all of its compensation, costs,expenses and other amounts due hereunder.  

**ARTICLEXIAMENDMENT AND TERMINATION**

                        11.1     **Amendment;Trust Irrevocable**.  Except as expressly set forth in this Trust Agreement,this Trust shall be irrevocable; provided, however, that the Board of Directorsshall possess the authority to amend this Trust Agreement in the followingcircumstances: (a) as may be reasonably required to appoint a successor trusteehereunder, (b) as may be reasonably required in order to maintain this Trust aspart of an unfunded deferred compensation arrangement within the meaning ofERISA or the Code, or (c) as may be required to facilitate participation inthis Trust by one or more Affiliates of the Company.

                        11.2     **Termination**. This Trust shall terminate when its assets have been paid or distributed, intheir entirety, in accordance with the provisions of this Trust Agreement.

**ARTICLEXIIMISCELLANEOUS**

                        12.1     **Severability**. Any provision of this Trust Agreement prohibited by law shall be ineffective tothe extent of any such prohibition, without invalidating the remainingprovisions hereof.

                        12.2     **GoverningLaw**.  This Trust Agreement shall be governed by and construed in accordancewith the laws of the State of Louisiana, without regard to conflicts of lawprovisions thereof.

                        12.3     **HoldHarmless**.  The Company agrees to indemnify the Trustee and to hold theTrustee harmless from all liabilities and claims against the Trustee arisingfrom the Trustee's performance of its duties in accordance with the terms ofthis Trust Agreement, unless such liability or expense results from a negligentact or omission of the Trustee, an act or omission performed in bad faith or anact or omission taken in contravention of the terms of this Trust Agreement orthe directions of the Company or the Committee, as the case may be.

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                        TheTrustee shall not be responsible or liable for any failure or delay in theperformance of its obligations under this Trust Agreement arising out of orcaused directly or indirectly by circumstances beyond its reasonable control,including, without limitation, acts of God, earthquakes, fires, floods, wars,civil or military disturbances, sabotage, epidemics, riots, interruptions, lossor malfunction of utilities or communications services, acts of civil ormilitary authority, or governmental actions.

                        12.4     **Notices. **All notices and other communications under this Trust Agreement must be inwriting and will be deemed to have been duly given when (a) delivered by hand,(b) sent by telecopier to a telecopier number given below, provided that a copyis sent by a nationally recognized overnight delivery service (receiptrequested), or (c) when received by the addressee, if sent by a nationallyrecognized overnight delivery service (receipt requested), in each case asfollows:

| If to Trustee:                      | Bank One Trust Company, N.A.    235 West Schrock Road    Westerville, OH 43081  Attention: Technical Support Unit  telecopier: (614) 244-6585  |
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| If to the Company  or an Affiliate: | Cleco Corporation  2030 Donahue Ferry Road    Pineville, LA 71360  Attention: Chief Executive Officer  Telecopier:   (318) 484-7777       |

or to such other addresses as a party may designate bynotice to the other party.

                        12.5     **Feesand Expenses.**  In the event of any dispute, controversy or claim withrespect to obligations of the Company or the Trustee in connection with thisTrust Agreement, including disputes resolved pursuant to Paragraph 12.6, theparties hereby agree that, subject to Paragraph 12.3 hereof, each party shallbear its own administrative expenses, costs and attorney's fees.     

                        12.6     **DisputeResolution.**  The parties agree that any disputes, controversies or claimsarising out of or in relation to this Trust Agreement or the enforcementthereof, shall be decided by binding arbitration which shall be administered bythe American Arbitration Association (the "AAA") and shall be conducted, uponrequest by either party, before one arbitrator designated by the AAA, inaccordance with the terms of the Commercial Arbitration Rules of the AAA, and,to the maximum extent applicable, the United States Arbitration Act (Title 9 ofthe United States Code).  The arbitration shall take place in the state of Louisiana,at such place or places as the arbitrator shall designate.  The arbitratorshall base his or her decision only upon evidence which is admissible under theFederal Rules of Evidence.  In rendering a decision, the arbitrator shall makespecific written findings of fact, taking into account applicable judicialprecedents and industry practice.  Judgment on the award rendered by thearbitrator may be entered in any court in Louisiana having jurisdictionthereof.  An arbitrator shall have 

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authority only to award actualdamages.  To the maximum extent practicable, an arbitration proceeding underthis Trust Agreement shall be concluded within 120 days of the filing of thedispute with the AAA.  The provisions of this arbitration clause shall surviveany termination, amendment or expiration of this Trust Agreement. 

                        12.7     **Delegation.** Notwithstanding any provision of this Trust Agreement or the Plan to thecontrary, the Committee shall possess the authority to delegate to one or moreofficers of the Company (or its Affiliates) all or any portion of the power andauthority granted to the Committee hereunder.  Such delegation may be madeorally or in writing and shall be deemed communicated to the Trustee uponreceipt by the Trustee of the authorized signatures of such designees.

                        **THISAGREEMENT IS EXECUTED** in multiple counterparts, each of which shall bedeemed an original, as of the dates set forth below to be first effective as ofthe date set forth above. 

**
**WITNESSES:**

**CLECO CORPORATION**

/s/ Carla D. Boothe                                   /s/ Janice B.  Mount                                 

By: /s/ Catherine c. PowellTitle: Sr. Vice President - Employee & Corporate Services

  Date: January 30, 2001

**WITNESSES:**

**BANK ONE TRUST COMPANY, N.A.  OF  COLUMBUS,  OHIO, AS TRUSTEE**

/s/ Rose Soileau                                       /s/ Laura Aucoin'                                   

By: /s/ Todd J. Hoffpauir                                                    Title: Authorized  Signer                                                     

 

  Date: February 15, 2001
**

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**CLECO CORPORATIONACKNOWLEDGMENT**

**STATE OF  LOUISIANAPARISH OF RAPIDES**

**                         BEFOREME**, the undersigned Notary Public, personally came and appeared CatherineC. Powell, who being by me sworn did depose and state that he/she signedthe foregoing Cleco Corporation Deferred Compensation Trust as a free act anddeed on behalf of  Cleco Corporation, as the Company, for the purposes thereinset forth. 

|                                                                                                                                                                                                        | /s/ Catherine C.  Powell                                   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                        | CLECO CORPORATION                                                                                                                                                                                                                    |
| SWORN TO AND SUBSCRIBED  BEFORE ME THIS  DAY OF JANUARY, 2001.                                                                                                                                         |                                                                                                                                                                                                                                      |
| /s/ Beatrice P.  Newcomb                              |                                                                                                                                                                                                                                      |
| NOTARY PUBLIC                                                                                                                                                                                          |                                                                                                                                                                                                                                      |

 

**TRUSTEEACKNOWLEDGMENT**

** **

**STATE OF  LOUISIANAPARISH OF          Lafayette           **

**                         BEFOREME**, the undersigned Notary Public, personally came and appeared Todd J.Huffpauir,who being by me sworn did depose and state that he/she signed the foregoingCleco Corporation Deferred Compensation Trust as a free act and deed on behalfof Bank One Trust Company, N.A. of Columbus, Ohio, the Trustee, for thepurposes therein set forth. 

                                                            

|                                                                                                                                                                                                 | /s/ Todd J. Hoffpauir                                   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                 | TRUSTEE                                                                                                                                                                                                                           |
| SWORN TO AND SUBSCRIBED  BEFORE ME THIS  DAY OF JANUARY, 2001.                                                                                                                                  |                                                                                                                                                                                                                                   |
| /s/ Melissa Dugas                              |                                                                                                                                                                                                                                   |
| NOTARY PUBLIC                                                                                                                                                                                   |                                                                                                                                                                                                                                   |

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