<PAGE>
                                                                    Exhibit 10.3

                            ADMINISTRATION AGREEMENT

       This Administration Agreement, dated as of _________ 2002, is made by and
between Atlantic City Electric Transition Funding LLC, a Delaware limited
liability company (together with any successor thereto permitted under the
Indenture, as hereinafter defined, the "Issuer"), and Conectiv Resource
Partners, Inc., a Delaware corporation, as Administrator (together with its
permitted successors or assigns as administrator hereunder, the
"Administrator").

                                    RECITALS

       A. WHEREAS, the Issuer is issuing the Transition Bonds pursuant to an
indenture dated as of the date hereof between the Issuer and
___________________, as Trustee (the "Trustee") (as such indenture is amended,
modified or supplemented from time to time in accordance with the provisions
thereof, the "Indenture"; capitalized terms used herein and not defined herein
shall have the meanings assigned such terms in the Indenture);

       B. WHEREAS, the Issuer has entered into certain agreements in connection
with the issuance of the Transition Bonds, including (i) a Bondable Transition
Property Sale Agreement dated as of the date hereof (as amended, modified or
supplemented from time to time in accordance with the provisions thereof, the
"Sale Agreement"), between the Issuer and Atlantic City Electric Company, as
Seller (in such capacity, the "Seller"), (ii) a Bondable Transition Property
Servicing Agreement dated as of the date hereof (as amended, modified or
supplemented from time to time in accordance with the provisions thereof, the
"Servicing Agreement"), between the Issuer and Atlantic City Electric Company,
as Servicer (in such capacity, together with its successors and assigns
permitted under the Servicing Agreement, the "Servicer"), (iii) an Underwriting
Agreement, dated as of __________, 2002 (as amended, modified or supplemented
from time to time in accordance with the provisions thereof, the "Underwriting
Agreement"), among the Issuer, Atlantic City Electric Company and the
Underwriters named therein, and (iv) the Indenture, (together with the Sale
Agreement, the Servicing Agreement and the Indenture, the "Related Agreements");

       C. WHEREAS, pursuant to the Related Agreements, the Issuer is required to
perform certain duties in connection with the Transition Bonds and the
collateral therefor pledged pursuant to the Indenture (the "Collateral") and to
maintain its existence and comply with applicable laws;

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

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

       F. NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and
<PAGE>
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:

                                   ARTICLE I.

                             Duties of Administrator

       Section 1.01 Appointment of Administrator; Acceptance of Appointment. The
Issuer hereby appoints the Administrator, and the Administrator hereby accepts
such appointment, to perform the Administrator's obligations pursuant to this
Agreement on behalf of and for the benefit of the Issuer in accordance with the
terms of this Agreement and applicable law.

       Section 1.02 Duties with Respect to the Related Agreements.

       (a) The Administrator agrees to perform all its duties as Administrator
hereunder in accordance with the terms of this Agreement and applicable law. In
addition, the Administrator shall consult with the Issuer regarding the Issuer's
duties under the Related Agreements. Unless otherwise notified in writing by the
Issuer, the Administrator shall prepare for execution by the Issuer, or shall
cause the preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty
of the Issuer to prepare, file, obtain or deliver pursuant to any Related
Agreement. In furtherance of the foregoing, the Administrator shall take all
appropriate action that it is the duty of the Issuer to take pursuant to the
Indenture including, without limitation, such of the foregoing as are required
with respect to the following matters under the Indenture (references
hereinafter in this Section 1.02(a) being to sections of the Indenture):

              (1) the preparation of or obtaining of the Transition Bonds and or
any other Issuer documents and instruments required for authentication of the
Transition Bonds, if any, and delivery of the same to the Trustee for
authentication (Sections 2.02 and 2.10);

              (2) the duty to cause the Register to be kept and, during any
period of time when the Trustee is not the Registrar, to give the Trustee notice
of any appointment of a new Registrar and the location, or change in location,
of the Register (Section 2.05);

              (3) the fixing or causing to be fixed of any special record date
and the notification of each affected Holder of Transition Bonds with respect to
special record dates, payment dates, and the amount of defaulted interest (plus
interest on such defaulted interest) to be paid, if any (Section 2.08(c));

              (4) the duty to cause each newly appointed Paying Agent (other
than the Trustee), if any, to deliver to the Trustee the instrument specified in
the Indenture regarding its agreement with the Trustee (Section 3.03);

              (5) the direction to any Paying Agent to pay to the Trustee all
sums held in trust by such Paying Agent (Section 3.03);

              (6) the preparation and filing of all documents and instruments
necessary to

                                       2
<PAGE>
maintain the Issuer's existence, rights and franchises as a limited liability
company under the laws of the State of Delaware (unless the Issuer becomes, or
any successor Issuer under the Indenture is or becomes, organized under the laws
of any other state or of the United States of America, in which case the
Administrator shall prepare and file all documents and instruments necessary to
maintain such Issuer's existence, rights and franchises under the laws of such
other jurisdiction) (Section 3.04);

              (7) the obtaining and preservation of the Issuer's qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of the Indenture, the
Transition Bonds, the Collateral and each other instrument or agreement included
in the Collateral (Section 3.04);

              (8) the preparation of all supplements and amendments to the
Indenture, filings with the BPU pursuant to the Competition Act, financing
statements, continuation statements, instruments of further assurance and other
instruments, in accordance with Section 3.05 of the Indenture, necessary to
protect the Collateral (Section 3.05);

              (9) the obtaining of Opinions of Counsel and the delivery of such
Opinions of Counsel, in accordance with Section 3.06 of the Indenture, as to the
Collateral (Section 3.06);

              (10) the identification to the Trustee in an Officers' Certificate
of any Person (other than the Administrator and the Servicer) with whom the
Issuer has contracted to perform its duties under the Indenture (Section
3.07(b));

              (11) the annual preparation and delivery of an Officers'
Certificate to the Trustee, as to compliance with conditions and covenants under
the Indenture (Section 3.09);

              (12) the preparation and obtaining of documents and instruments
required for the release of the Issuer from its obligations under the Indenture
(Section 3.11(b));.

              (13) promptly after an Authorized Officer of the Administrator has
actual knowledge thereof, the delivery of written notice to the Trustee, and the
Rating Agencies of each Event of Default under the Indenture, each Servicer
Default by the Servicer under and as defined in the Servicing Agreement and each
default by the Seller of its obligations under the Sale Agreement (Section
3.20);

              (14) the preparation of or obtaining of an Officers' Certificate,
an Opinion of Counsel and an Independent Certificate relating to (i) the
satisfaction and discharge of the Indenture under Section 4.01 of the Indenture
or (ii) the exercise of the Legal Defeasance Option or the Covenant Defeasance
Option under Section 4.02 of the Indenture (Sections 4.01 and 4.02);

              (15) during any period when the Trustee is not the Registrar, the
furnishing to the Trustee of a list of the names and addresses of Transition
Bondholders as required of the Issuer under Section 7.01 of the Indenture
(Section 7.01);

              (16) to the extent not required to be performed by the Servicer,
the preparation and, after execution by the Issuer, the filing with the
Securities and Exchange Commission or any

                                       3
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successor agency (the "SEC") and the Trustee of the annual reports and of the
information, documents and other reports, required to be filed on a periodic
basis with, and summaries thereof as may be required by rules and regulations
prescribed by, the SEC and the transmission of such summaries, as necessary, to
the Trustee (Section 7.03);

              (17) the notification of the Trustee if and when the Transition
Bonds are listed on any stock exchange (Section 7.04);

              (18) the opening of one or more segregated trust accounts in the
Trustee's name, the preparation of Issuer Orders, and the obtaining of Opinions
of Counsel and the taking of all other actions necessary with respect to
investment and reinvestment of funds in the Collection Account (Section 8.02);

              (19) the preparation of Issuer Requests and Officers' Certificates
and the obtaining of Opinions of Counsel and Independent Certificates, if
necessary, for the release of the Collateral (Sections 8.03 and 8.04);

              (20) the preparation of Issuer Orders and the obtaining of
Officers' Certificates with respect to the execution of supplemental indentures
(Sections 9.01 and 9.02);

              (21) if required by the Trustee or the Issuer, the preparation of
new Transition Bonds conforming to any supplemental indenture (Section 9.06);

              (22) the preparation and delivery of the written notification of
the Issuer or, if requested by the Trustee, to be given by the Trustee of any
redemption of Transition Bonds as required under the Indenture (Sections 10.01
and 10.02);.

              (23) the preparation of all Officers' Certificates and obtaining
of all Opinions of Counsel and Independent Certificates, if necessary, with
respect to any requests by the Issuer to the Trustee to take any action under
the Indenture (Section 11.01(a));

              (24) the obtaining of evidence that the Rating Agency Condition
shall have been satisfied whenever required to be obtained under the Indenture
or any other Related Agreement.

              (25) for so long as any Transition Bonds are listed on the
Luxembourg Stock Exchange and the rules and regulations of such exchange so
require, the retaining of a listing agent, a transfer agent and a paying agent
in Luxembourg, the giving of prompt written notice to the Trustee and any other
agent appointed under Section 3.02(b) of the Indenture of the location and
identity, and of any change in the location or identity, of any such office or
agency, and the preparation of any reports or other filings required to be filed
by the Issuer or the Issuer with the Luxembourg Stock Exchange (Sections 3.02(b)
and 7.03); and

              (26) for so long as any Certificates are listed on the Luxembourg
Stock Exchange and the rules and regulations of such exchange so require, the
giving of notices of redemption by publication in a daily newspaper in
Luxembourg (Section 10.03).


                                       4
<PAGE>
       (b) The Administrator shall also take all appropriate action that it is
the duty of the Issuer to take pursuant to the Underwriting Agreement including,
without limitation, the following matters (references hereinafter in this
Section 1.02(b) being to sections of the Underwriting Agreement):

              (1) to the extent not already delivered, the delivery to the
Representatives (as defined in the Underwriting Agreement) and counsel for the
Underwriters under the Underwriting Agreement (the "Underwriters"), of copies of
the Registration Statement (as defined in the Underwriting Agreement) (Section
5(a)(iv));

              (2) so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act, the delivery to the Representatives and
counsel for the Underwriters of as many copies of any Preliminary Final
Prospectus and the Final Prospectus and any supplement thereto as the
Representatives may reasonably request (Section 5(a)(iv));

              (3) to the extent not required to be performed by the Servicer,
the preparation and, after execution by the Issuer, the filing with the SEC of
reports on Form SR as required by Rule 463 under the Act, and the delivery of
such reports on Form SR, as filed with the SEC, to the Representatives (Section
5(a)(iv));

              (4) the preparation and, after execution by the Issuer, the filing
of all documents and instruments necessary to qualify the Transition Bonds for
sale under the laws of such jurisdictions as the Representatives may designate,
and the maintenance of such qualifications in effect so long as required for the
distribution of the Transition Bonds, subject to the qualifications, limitations
and exceptions set forth in the Underwriting Agreement (Section 5(a)(v));

              (5) the arrangement for the determination of the legality of the
Transition Bonds for purchase by institutional investors (Section 5(a)(v));

              (6) to the extent not already performed by the Servicer, the
delivery to the Representatives of the annual statements of compliance and the
annual independent auditor's servicing reports furnished to the Issuer or the
Trustee pursuant to the Servicing Agreement or the Indenture, subject to the
qualifications, limitations and exceptions set forth in the Underwriting
Agreement (Section 5(a)(vii));

              (7) so long as any of the Transition Bonds are outstanding, and to
the extent not already performed by the Servicer, the delivery to the
Representatives of (i) a copy of any filings with the BPU or any other
governmental agency or instrumentality relating to the Transition Bonds and (ii)
from time to time, any information concerning the Issuer to the extent readily
available, that the Representatives may reasonably request (Section 5(a)(viii));
and

              (8) to the extent, if any, that any rating necessary to satisfy
the condition set forth in Section 6(o) of the Underwriting Agreement is
conditioned upon the furnishing of documents or the taking of other actions by
the Issuer on or after the Closing Date (as defined in the Underwriting
Agreement), the delivery of such documents and the taking of such actions

                                       5
<PAGE>
(Section 5(a)(ix)).

       Section 1.03 Additional Duties.

       (a) In addition to the duties of the Administrator set forth above, the
Administrator shall perform such calculations and shall prepare for execution by
the Issuer or shall cause the preparation by other appropriate Persons of all
such documents, reports, filings, instruments, certificates and opinions as it
shall be the duty of the Issuer to prepare, file, obtain or deliver pursuant to
the Related Agreements, and at the request of the Issuer shall take all
appropriate action that it is the duty of the Issuer to take pursuant to the
Related Agreements. Subject to Section 5.01 of this Agreement, and in accordance
with the directions of the Issuer, the Administrator shall administer, perform
or supervise the performance of such other activities in connection with the
Collateral and the Related Agreements as are not covered by any of the foregoing
provisions and as are expressly requested by the Issuer and are reasonably
within the capability of the Administrator.

       (b) In carrying out the foregoing duties or any of its other obligations
under this Agreement, the Administrator may enter into transactions with or
otherwise deal with any of its Affiliates; provided, however, that the terms of
any such transactions or dealings shall be, in the Administrator's reasonable
opinion, no less favorable to the Issuer than would be available from
unaffiliated parties.

       Section 1.04 Non-Ministerial Matters.

       (a) With respect to matters that in the reasonable judgment of the
Administrator are non-ministerial, the Administrator shall not take any action
unless the Administrator shall have notified the Issuer of the proposed action
and the Issuer shall have consented. For the purpose of the preceding sentence,
"non-ministerial matters" shall include, without limitation:

              (1) the amendment of, or any supplement to, the Indenture;

              (2) the initiation of any claim or lawsuit by the Issuer and the
compromise of any action, claim or lawsuit brought by or against the Issuer
(other than in connection with the collection of the Transition Bond Charge);

              (3) the amendment, change or modification of any of the Related
Agreements;

              (4) the appointment of successor Registrars, successor Paying
Agents and successor Trustees pursuant to the Indenture or the appointment of
successor Administrators or successor Servicers, or the consent to the
assignment by the Registrar, Paying Agent or Trustee of its obligations under
the Indenture; and

              (5) the removal of the Trustee.

       (b) Notwithstanding anything to the contrary in this Agreement, the
Administrator shall not be obligated to, and hereby agrees that it shall not,
take any action that the Issuer directs the Administrator not to take on its
behalf.


                                       6
<PAGE>
       Section 1.05 Records. The Administrator shall maintain appropriate books
of account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer and the
Trustee at any time during normal business hours.

                                  ARTICLE II.

                                   Facilities

       Section 2.01 Facilities. During the term of this Agreement, the
Administrator shall make available to or provide the Issuer with such facilities
as are necessary to conduct the business of the Issuer and to comply with the
terms of the Related Agreements. Such facilities shall include office space to
serve as the principal place of business of the Issuer. Initially such office
space will be located at [ ]. All facilities provided to the Issuer hereunder
shall be provided without warranty of any kind.

                                  ARTICLE III.

                                  Compensation

       Section 3.01 Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement, including the provision of
facilities pursuant to Section 2.01, the Administrator shall be entitled to an
annual fee of $_________, payable monthly. In addition, the Issuer shall
reimburse the Administrator for all filing fees and expenses, legal fees, fees
of outside auditors and other out-of-pocket expenses incurred by the
Administrator in the course of performing its duties hereunder. The
Administrator's compensation and other expenses payable hereunder shall be paid
from the Collection Account pursuant to Section 8.02 of the Indenture, and the
Administrator shall have no recourse against the Issuer for payment of such
amounts other than in accordance with Section 8.02 of the Indenture.

                                  ARTICLE IV.

                             Additional Information

       Section 4.01 Additional Information To Be Furnished to Issuer. The
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.

                                   ARTICLE V.

                            Miscellaneous Provisions

       Section 5.01 Independence of Administrator. For all purposes of this
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

                                       7
<PAGE>
hereunder. Unless expressly authorized by the Issuer, the Administrator shall
have no authority to act for or represent the Issuer in any way and shall not
otherwise be deemed an agent of the Issuer.

       Section 5.02 No Joint Venture. Nothing contained in this Agreement shall
(a) constitute the Administrator and the Issuer as members of any partnership,
joint venture, association, syndicate, unincorporated business or other separate
entity, (b) be construed to impose any liability as such on any of them or (c)
be deemed to confer on any of them any express, implied or apparent authority to
incur any obligation or liability on behalf of the others.

       Section 5.03 Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other Person even though such Person may engage in
business activities similar to those of the Issuer.

       Section 5.04 Term of Agreement; Resignation and Removal of Administrator.

       (a) This Agreement shall continue in force for one year and one day after
the retirement of all Transition Bonds issued pursuant to the Indenture.

       (b) Subject to Sections 5.04(e) and 5.04(f), the Administrator may resign
its duties hereunder by providing the Issuer with at least 60 days prior written
notice.

       (c) Subject to Sections 5.04(e) and 5.04(f), the Issuer may remove the
Administrator without cause by providing the Administrator with at least 60 days
prior written notice.

       (d) Subject to Sections 5.04(e) and 5.04(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:

              (1) the Administrator shall default in the performance of any of
its duties under this Agreement and, after notice of such default, shall not
cure such default within ten days (or, if such default is curable but cannot be
cured in such time, shall not give within ten days such assurance of cure as
shall be reasonably satisfactory to the Issuer);

              (2) a court having jurisdiction in the premises shall enter a
decree or order for relief, and such decree or order shall not have been vacated
within 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 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

              (3) 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, or 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

                                       8
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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 clause
(2) or (3) of this Section 5.04(d) shall occur, it shall give written notice
thereof to the Issuer and the Trustee within seven days after the happening of
such event.

       (e) No resignation or removal of the Administrator pursuant to this
Section 5.04 shall be effective until (1) a successor Administrator shall have
been appointed by the Issuer and (2) such successor Administrator shall have
agreed in writing to be bound by the terms of this 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.

       Section 5.05 Action upon Termination, Resignation or Removal. Promptly
upon the effective date of termination of this Agreement pursuant to Section
5.04(a) or the resignation or removal of the Administrator pursuant to Sections
5.04(b) or 5.04(c) respectively, the Administrator shall be entitled to be paid
all fees accruing to it and expenses accrued by it in the performance of its
duties hereunder through the date of such termination, resignation or removal,
to the extent permitted under Article III. The Administrator shall forthwith
upon such termination pursuant to Section 5.04(a) deliver to the Issuer all
property and documents of or relating to the Collateral then in the custody of
the Administrator. In the event of the resignation or removal of the
Administrator pursuant to Sections 5.04(b), 5.04(c), or 5.04(d) respectively,
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.

       Section 5.06 Notices. Unless otherwise specifically provided herein, all
notices, directions, consents and waivers required under the terms and
provisions of this Administration Agreement shall be in English and in writing,
and any such notice, direction, consent or waiver may be given by United States
mail, courier service, facsimile transmission or electronic mail (confirmed by
telephone, United States mail or courier service in the case of notice by
facsimile transmission or electronic mail) or any other customary means of
communication, and any such notice, direction, consent or waiver shall be
effective when delivered, or if mailed, three days after deposit in the United
States mail with proper postage for ordinary mail prepaid, except that notices
to the Trustee are effective only upon receipt:

(a)         if to the Issuer, to

                        Atlantic City Electric Transition Funding LLC
                        800 King Street
                        Wilmington, Delaware 19899
                              Facsimile:
                              Telephone:
                              Email:

(b)         if to the Administrator, to


                                       9
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                        Conectiv Resource Partners, Inc.

                        -----------------------------------

                        -----------------------------------

                        -----------------------------------
                        Attention:
                                    -----------------------
                        Facsimile:
                                    -----------------------
                        Telephone:
                                    -----------------------

(c)         if to the Trustee, to

                        -----------------------------------

                        -----------------------------------

                        -----------------------------------

                        Attention:
                                    -----------------------
                        Facsimile:
                                    -----------------------
                        Telephone:
                                    -----------------------

or to such other address as any party shall have provided to the other parties
in writing.

       Section 5.07 Amendments. This Agreement may be amended in writing by the
Administrator and the Issuer upon compliance with the applicable terms of
Section 3.20 of the Indenture. In addition, and without limitation of any such
terms:

       (a) promptly after the execution of any such amendment and obtaining of
the requisite consents, if any, the Administrator shall furnish written
notification of the substance of such amendment to the Trustee and each of the
Rating Agencies; and

       (b) prior to its consent to any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
such amendment is authorized or permitted by this Agreement.

The Trustee may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement or otherwise.

       Section 5.08 Successors and Assigns. This Agreement may not be assigned
by the Administrator unless such assignment is previously consented to in
writing by the Issuer and the Trustee and is subject to the satisfaction of the
Rating Agency Condition in respect thereof. An 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 Agreement may be assigned by the Administrator without the
consent of the Issuer and 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 and the Trustee an agreement in which such corporation or other
organization agrees to be bound hereunder by the terms of said assignment

                                       10
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in the same manner as the Administrator is bound hereunder and the Rating Agency
Condition is satisfied. Subject to the foregoing, this Agreement shall bind any
successors or assigns of the parties hereto.

       Section 5.09 Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Administrator, the Issuer, the
Trustee and the Transition Bondholders. The Transition Bondholders shall be
entitled to enforce their rights and remedies against the Administrator under
this agreement solely in accordance with and subject to the provisions of
Section 5.06 of the Indenture, and nothing in this Agreement, whether express or
implied, shall be construed to give to any other Person any legal or equitable
right, remedy or claim in the Bondable Transition Property or under or in
respect of this Agreement or any covenants, conditions or provisions contained
herein, except for the indemnities specifically provided in Section 5.15. The
Persons listed in this section as having the benefit of this Agreement and the
Indemnified Persons listed in Section 5.15 shall have rights of enforcement with
respect to their respective rights in, to and under this Agreement.

       Section 5.10 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW JERSEY, 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.

       Section 5.11 Headings; References. 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 Agreement. Unless otherwise
specified, references herein to sections or articles are to the sections or
articles of this Agreement.

       Section 5.12 Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.

       Section 5.13 Severability. Any provision of this 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.

       Section 5.14 Nonpetition Covenants. Notwithstanding any prior termination
of this Agreement or the Indenture, the Administrator hereby covenants and
agrees that it shall not, prior to the date which is one year and one day after
the termination of the Indenture and the payment in full of all of the
outstanding Transition Bonds, all other amounts owed under the Indenture
(including without limitation any amounts owed to third-party credit enhancers)
and all amounts owed by the Issuer under all Hedge Agreements and Interest Rate
Swap Agreements, acquiesce in, petition or otherwise invoke or, to the fullest
extent permitted by law, cause the Issuer to invoke the process of any court or
governmental authority for the 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

                                       11
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official of the Issuer or any substantial part of the property of the Issuer, or
ordering the winding up or liquidation of the affairs of the Issuer; provided,
however, that nothing in this Section 5.14 shall constitute a waiver of any
right to indemnification, reimbursement or other payment from the Issuer
pursuant to this Agreement.

       Section 5.15 Indemnification. The Administrator shall indemnify the
Issuer and the Trustee, and their respective officials, officers, directors,
managers, employees, consultants, counsel and agents (each an "Indemnified
Person") for, and defend and hold harmless each such Person from and against,
any and all liabilities, obligations, actions, suits, claims, losses, damages,
payments, costs or expenses of any kind whatsoever ("Losses") that may be
imposed on, incurred by or asserted against any such Person as a result of the
Administrator's willful misconduct or negligence in the performance of its
duties or observance of its covenants under this Agreement; provided, however,
that the Administrator shall not be liable for any Losses resulting from the
willful misconduct or gross negligence of such Indemnified Person. The
Transition Bondholders shall be entitled to enforce their rights and remedies
against the Administrator under this indemnification solely in accordance with
and subject to the provisions of Section 5.06 of the Indenture. The
Administrator shall not be required to indemnify an Indemnified Person for any
amount paid or payable by such Indemnified Person in the settlement of any
action, proceeding or investigation without the written consent of the
Administrator, which consent shall not be unreasonably withheld. Promptly after
receipt by an Indemnified Person of notice of its involvement in any action,
proceeding or investigation, such Indemnified Person shall, if a claim for
indemnification in respect thereof is to be made against the Administrator under
this Section 5.15, notify the Administrator in writing of such involvement.
Failure by an Indemnified Person to so notify the Administrator shall relieve
the Administrator from the obligation to indemnify and hold harmless such
Indemnified Person under this Section 5.15 only to the extent that the
Administrator suffers actual prejudice as a result of such failure. With respect
to any action, proceeding or investigation brought by a third party for which
indemnification may be sought under this Section 5.15, the Administrator shall
be entitled to assume the defense of any such action, proceeding or
investigation. Upon assumption by the Administrator of the defense of any such
action, proceeding or investigation, the Indemnified Person shall have the right
to participate in such action or proceeding and to retain its own counsel. The
Administrator shall be entitled to appoint counsel of the Administrator's choice
at the Administrator's expense to represent the Indemnified Person in any
action, proceeding or investigation for which a claim of indemnification is made
against the Administrator under this Section 5.15 (in which case the
Administrator shall not thereafter be responsible for the fees and expenses of
any separate counsel retained by the Indemnified Person except as set forth
below); provided, however, that such counsel shall be reasonably satisfactory to
the Indemnified Person. Notwithstanding the Administrator's election to appoint
counsel to represent the Indemnified Person in an action, proceeding or
investigation, the Indemnified Person shall have the right to employ separate
counsel (including local counsel), and the Administrator shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use of
counsel chosen by the Administrator to represent the Indemnified Person would
present such counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the Indemnified
Person and the Administrator and the Indemnified Person shall have reasonably
concluded that there may be legal defenses available to it that are different
from or additional to

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<PAGE>
those available to the Administrator, (iii) the Administrator shall not have
employed counsel reasonably satisfactory to the Indemnified Person to represent
the Indemnified Person within a reasonable time after notice of the institution
of such action or (iv) the Administrator shall authorize the Indemnified Person
to employ separate counsel at the expense of the Administrator. Notwithstanding
the foregoing, the Administrator shall not be obligated to pay for the fees,
costs and expenses of more than one separate counsel for the Indemnified Persons
(in addition to local counsel). The Administrator shall not, without the prior
written consent of the Indemnified Person, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification may be sought
under this Section 5.15 (whether or not the Indemnified Person is an actual or
potential party to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of the Indemnified Person from all
liability arising out of such claim, action, suit or proceeding. The indemnities
contained in this Section 5.15 shall survive the resignation of the Trustee and
the termination of this Agreement.

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

                                    ATLANTIC CITY ELECTRIC TRANSITION
                                    FUNDING LLC, as Issuer

                                    By: __________________
                                    Name: ________________
                                    Title:   ________________

                                    CONECTIV RESOURCE PARTNERS, INC.,
                                    as Administrator

                                    By: __________________
                                    Name: ________________
                                    Title:   ________________


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