Document:

exv4wb

Exhibit 4(b)

Progress Energy, Inc.

OFFICER’S CERTIFICATE

     Sherri L. Green, the Treasurer of Progress Energy, Inc. (the “Company”), pursuant to the
authority granted in the Securities Pricing Committee Resolutions dated January 18, 2011 and the
Indenture, as defined herein, does hereby certify to The Bank of New York Mellon Trust Company,
National Association (the “Trustee”), as successor Trustee under the Indenture (For Debt
Securities) of the Company, dated as of February 15, 2001 (as supplemented by this Officer’s
Certificate, the “Indenture”), that she has authorized the issue and sale of $500,000,000 principal
amount of 4.40% Senior Notes due 2021 (the “Notes”) by the Company, and, in connection with such
issuance, has determined, approved, or appointed, as the case may be, the following:

	1.	 	The notes of this series issued under the Indenture shall be designated “4.40% Senior Notes
due 2021.” The Form of Note is attached hereto as Exhibit A. All capitalized terms
used in this certificate which are not defined herein shall have the meanings (if any) set
forth in Exhibit A hereto; all capitalized terms used in this certificate which are
not defined herein or in Exhibit A hereto shall have the meanings set forth in the
Indenture.
	 
	2.	 	If not redeemed earlier pursuant to their terms, the Notes shall mature and the principal
thereof shall be due and payable together with all accrued and unpaid interest thereon on
January 15, 2021.
	 
	3.	 	The Notes shall initially be issued as Global Securities registered in the name of a nominee
of The Depository Trust Company. The Notes shall be issued in denominations of $2,000 and
integral multiples of $1,000 above that amount.
	 
	4.	 	The Notes shall bear interest as provided in Exhibit A.
	 
	5.	 	The Notes may be redeemed at any time as provided in Exhibit A.
	 
	6.	 	The Notes shall not be subject to a sinking fund.
	 
	7.	 	Principal and interest will be payable initially at the corporate trust office of The Bank of
New York Mellon Trust Company, National Association, presently located at 10161 Centurion
Parkway, Jacksonville, Florida 32256, or such other place as may be designated by the Company
from time to time.
	 
	8.	 	The Notes will be subject to certain events of default and certain covenants as set forth in
the Indenture and Exhibit A.
	 
	9.	 	The Trustee shall initially be The Bank of New York Mellon Trust Company, National
Association, the principal corporate trust office of which presently is located at 10161
Centurion Parkway, Jacksonville, Florida 32256.
	 
	10.	 	The Notes shall be senior unsecured obligations of the Company.

 

 

	11.	 	Any further terms of the Notes shall be as provided for in Exhibit A hereto and in
the Indenture.

[Remainder of Page Intentionally Left Blank]

2

 

     IN WITNESS WHEREOF, the undersigned Treasurer of the Company has executed this Certificate as
of the 21st day of January, 2011.

	 	 	 	 	 
	 	 	 
	 	/s/
Sherri L. Green 	 
	 	Sherri L. Green, Treasurer 	 
	 	 	 

[Signature page to Officer’s Certificate for 4.40% Senior Notes]

 

 

EXHIBIT A

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED
IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF,
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO PROGRESS ENERGY, INC. (THE “COMPANY”) OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS 4.40% SENIOR NOTE DUE 2021, MAY AS PROVIDED IN THE INDENTURE, BE EXCHANGED FOR 4.40% SENIOR
NOTES DUE 2021 IN THE FORM OF DEFINITIVE CERTIFICATES OF LIKE TENOR AND OF AN EQUAL AGGREGATE
PRINCIPAL AMOUNT, IN AUTHORIZED DENOMINATIONS, REGISTERED IN THE NAMES OF SUCH PERSONS AS THE
DEPOSITARY SHALL INSTRUCT THE TRUSTEE, IF (I) THE DEPOSITARY GIVES NOTICE TO THE COMPANY OR TO THE
TRUSTEE THAT IT IS UNWILLING OR UNABLE TO CONTINUE AS DEPOSITARY AND A SUCCESSOR DEPOSITARY IS NOT
APPOINTED BY THE COMPANY WITHIN 90 DAYS, (II) THE DEPOSITARY CEASES TO BE ELIGIBLE UNDER THE
INDENTURE AND A SUCCESSOR DEPOSITARY IS NOT APPOINTED BY THE COMPANY WITHIN 90 DAYS, OR (III) THE
COMPANY DECIDES TO DISCONTINUE USE OF THE SYSTEM OF BOOK-ENTRY TRANSFERS THROUGH THE DEPOSITARY OR
ITS SUCCESSOR. ANY SUCH EXCHANGE SHALL BE MADE UPON RECEIPT BY THE TRUSTEE OF AN OFFICER’S
CERTIFICATE THEREFOR AND A WRITTEN INSTRUCTION FROM THE DEPOSITARY SETTING FORTH THE NAME OR NAMES
IN WHICH THE TRUSTEE IS TO REGISTER SUCH 4.40% SENIOR NOTES DUE 2021 IN THE FORM OF DEFINITIVE
CERTIFICATES.

 

 

PROGRESS ENERGY, INC.

4.40% Senior Note due 2021

			
	 	 	 
	No. R-1
	 	$500,000,000

CUSIP No. 743263 AR6

     Progress Energy, Inc., a corporation duly organized and existing under the laws of the State
of North Carolina (herein called the “Company,” which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or
registered assigns, the principal sum of Five Hundred Million and No/100 Dollars ($500,000,000) on
January 15, 2021 and to pay interest thereon from January 21, 2011 or from the most recent Interest
Payment Date with respect to which interest has been paid or duly provided for, semi-annually on
January 15 and July 15 in each year (each an “Interest Payment Date”), commencing July 15, 2011, at
the rate of 4.40% per annum, until the principal hereof is paid or made available for payment,
provided that any principal and premium, and any such installment of interest, which is overdue
shall bear interest at the rate of 4.40% per annum (to the extent that the payment of such interest
shall be legally enforceable), from the dates such amounts are due until they are paid or made
available for payment, and such interest shall be payable on demand. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is
registered at the close of business on the Regular Record Date for such interest, which shall be
(i) for Notes of this series in the form of Global Securities, on the business day prior to each
Interest Payment Date, or (ii) for Notes of this series in the form of definitive certificates, on
January 1 or July 1 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Notes of this series not less than 10 days
prior to such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Notes of this series may
be listed, and upon such notice as may be required by such exchange, all as more fully provided in
said Indenture.

     Payment of the principal of (and premium if any) and such interest on this Note will be made
at the office or agency of the Trustee maintained for that purpose in The City of New York, in such
coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that at the option of the Company payment
of such interest may be made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Debt Security Register.

 

 

     The amount of interest payable for any period will be computed on the basis of a 360-day year
of twelve 30-day months. Interest will accrue from each prior Interest Payment Date to, but not
including, the relevant payment date. In the event that any date on which interest is payable on
the Notes of this series is not a Business Day at any Place of Payment, then payment of interest or
principal and premium, if any, need not be made at such Place of Payment on such date, but may be
made on the next succeeding Business Day at such Place of Payment with the same force and effect as
if made on the Interest Payment Date or redemption date, or at the stated maturity, and, if such
payment is made or duly provided for on such Business Day, no interest shall accrue on the amount
so payable for the period from and after such Interest Payment Date, redemption date or stated
maturity, as the case may be, to such Business Day. A “Business Day” means when used with respect
to a Place of Payment or any other particular location specified in the Indenture, means any day,
other than a Saturday or Sunday, which is not a day on which banking institutions or trust
companies in such Place of Payment or other location are generally authorized or required by law,
regulation or executive order to remain closed.

     Principal of and any premium on the Notes will be paid at stated maturity or the redemption
date, upon presentation of the Notes at the office of the Trustee, as the paying agent. The
Company may, at its discretion, appoint one or more additional paying agents and security
registrars and designate one or more additional places for payment and for registration of
transfer.

     Reference is hereby made to the further provisions of this Note set forth below, which further
provisions shall for all purposes have the same effect as if set forth at this place.

     Unless the certificate of authentication hereon has been executed by the Trustee referred to
below by manual signature, this Note shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.

 

 

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal.

     Dated: January 21, 2011

	 	 	 	 	 
	 	PROGRESS ENERGY, INC.

 	 
	 	By:  	
 	 
	[SEAL] 	 	Sherri L. Green 	 
	Attest: 	 	Treasurer 	 

	 	 	 	 	 
	 	 	 
	
 	 	 
	Holly H. Wenger 	 	 
	Assistant Secretary 	 	 

 

 

	 	 	 	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

     This is one of the Notes of the series designated herein referred to in the within-mentioned
Indenture.

     Dated: January 21, 2011

	 	 	 	 	 
	 	THE BANK OF NEW YORK MELLON TRUST 

COMPANY, NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	 	 
	 	 	Kristin A. Haskins 	 
	 	 	Authorized Representative 	 
	 

 

 

[Reverse of 4.40% Senior Note due 2021]

     This Note is one of the duly authorized issue of securities of the Company of the series
designated on the face hereof (herein called the “Notes”), issued and to be issued in one or more
series under an Indenture (For Debt Securities), dated as of February 15, 2001 (herein, together
with any amendments thereto, called the “Indenture,” which term shall have the meaning assigned to
it in such instrument), between the Company and The Bank of New York Mellon Trust Company, National
Association, as successor Trustee (herein called the “Trustee,” which term includes any successor
trustee under the Indenture), and reference is hereby made to the Indenture, including the Board
Resolutions and Officer’s Certificate filed with the Trustee on January 21, 2011, creating the
series designated on the face hereof, for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes
and of the terms upon which the Notes are, and are to be, authenticated and delivered.

     The Notes are senior unsecured obligations of the Company and rank equally with all of the
Company’s other senior unsecured indebtedness from time to time outstanding. Debt Securities may be
issued under the Indenture from time to time as a single series or in two or more separate series
up to the aggregate principal amount from time to time authorized for each series. The Company
may, from time to time, without the consent of the holder of this Note, provide for the issuance of
Notes or other Debt Securities under the Indenture in addition to this Note.

     The Notes will not be subject to a sinking fund.

Events of Default

     If an Event of Default with respect to Notes of this series shall occur and be continuing, the
principal of the Notes may be declared due and payable in the manner and with the effect provided
in the Indenture.

     In addition to the Events of Default specified in the Indenture, a default with respect to any
indebtedness to which the Company is a party other than the Notes of this series shall constitute
an Event of Default with respect to the Notes of this series if: (i) the default results from a
failure to pay such indebtedness when due, whether by reason of acceleration or otherwise
and (ii) the principal amount of such indebtedness, together with the principal amount of
any other such defaulted indebtedness, exceeds $100,000,000.

Restrictive Covenants

     Limitation on Liens

     So long as the Notes remain outstanding, neither the Company nor any of its Subsidiaries (as
defined below) may issue, assume or guarantee or permit to exist any indebtedness secured by a lien
on any capital stock of any Subsidiary or on any tangible property owned by the

 

 

Company or any Subsidiary, without effectively securing the Notes equally and ratably with (or
prior to) the new indebtedness (but only so long as such new indebtedness is so secured).

     The foregoing limitation does not limit the following liens and indebtedness:

          (1) purchase money liens on property acquired in the future; liens of any kind existing on
property or shares of stock at the time they are acquired; conditional sales agreements and other
title retention agreements on property acquired in the future (as long as none of the liens
referenced in this clause (1) cover any other properties of the Company or any of its
Subsidiaries);

          (2) liens on property that exist as of the date the Notes are first issued (including the
existing first mortgage indentures of Carolina Power & Light Company d/b/a Progress Energy
Carolinas, Inc. and Florida Power Corporation d/b/a Progress Energy Florida, Inc.); liens on the
shares of stock of any corporation, which liens existed at the time that corporation became a
Subsidiary;

          (3) liens in favor of the United States (or any State or territory thereof), any foreign
country or any department, agency or instrumentality or political subdivision of those
jurisdictions, to secure payments pursuant to any contract or statute or to secure any debt
incurred for the purpose of financing the purchase price or the cost of constructing or improving
the property subject to those liens, including, for example, liens to secure debt of the pollution
control or industrial revenue bond type;

          (4) debt issued by the Company or any Subsidiary in connection with a consolidation or merger
of the Company or any such Subsidiary with or into any other company in exchange for secured debt
of that company (“Third Party Debt”) as long as that debt (i) is secured by a mortgage on all or a
portion of the property of that company, (ii) prohibits secured debt from being incurred by that
company, unless the Third Party Debt is secured on an equal and ratable basis or (iii) prohibits
secured debt from being incurred by that company;

          (5) liens on any property acquired, constructed, developed or improved after the date the
Notes are first issued, which liens are created before or within 24 months after the acquisition,
construction, development or improvement of the property and secure the payment of the costs of
such acquisition, construction, development or improvement or related costs;

          (6) liens in favor of the Company or any of the Company’s wholly owned Subsidiaries;

          (7) the replacement, extension or renewal of any lien referred to above in clauses (1) through
(6) as long as the amount secured by the liens or the property subject to the liens is not
increased; and

          (8) any other lien not covered by clauses (1) through (7) above as long as immediately after
the creation of the lien the aggregate principal amount of debt secured by all liens created or
assumed under this clause (8), together with the aggregate Attributable Value of all Sale and
Leaseback Transactions (other than Sale and Leaseback Transactions permitted by

 

 

clause (2) of the “Limitation on Sale and Leaseback Transactions” covenant below), does not
exceed 20% of the Company’s Consolidated Net Tangible Assets.

     Limitation on Sale and Leaseback Transactions

     So long as the Notes remain outstanding, neither the Company nor any of its Subsidiaries may
enter into any Sale and Leaseback Transaction unless either:

          (1) the Company and its Subsidiaries would be entitled pursuant to the “Limitation on Liens”
covenant above to create indebtedness secured by a lien on the property to be leased back in an
amount equal to the Attributable Value of such Sale and Leaseback Transaction without the Notes
being effectively secured equally and ratably with (or prior to) that indebtedness; or

          (2) the Company or the relevant Subsidiary, within 270 days after the sale or transfer of the
relevant assets shall have been made, applies, in the case of a sale or transfer for cash, an
amount equal to the net proceeds from the sale or, in the case of a sale or transfer otherwise than
for cash, an amount equal to the fair market value of the property so leased (as determined by any
two directors of the Company or the relevant Subsidiary) to (i) the retirement of long-term
indebtedness of the Company or the relevant Subsidiary ranking prior to or on a parity with the
Notes or (ii) the investment in any property used in the ordinary course of business by the Company
or any Subsidiary.

     As used in this subsection:

     “Attributable Value” means, as to any particular lease under which the Company or any of its
Subsidiaries is at any time liable as lessee and at any date as of which the amount thereof is to
be determined, the amount equal to the greater of (i) the net proceeds from the sale or transfer of
the property leased pursuant to the Sale and Leaseback Transaction or (ii) the net book value of
the property, as determined by the Company in accordance with generally accepted accounting
principles at the time of entering into the Sale and Leaseback Transaction, in either case
multiplied by a fraction, the numerator of which shall be equal to the number of full years of the
term of the lease that is part of the Sale and Leaseback Transaction remaining at the time of
determination and the denominator of which shall be equal to the number of full years of the term,
without regard, in any case, to any renewal or extension options contained in the lease.

     “Consolidated Net Tangible Assets” means the amount shown as total assets on the Company’s
consolidated balance sheet, less (i) intangible assets including, without limitation, such items as
goodwill, trademarks, trade names, patents, unamortized debt discount and expense and certain
regulatory assets, and (ii) appropriate adjustments, if any, on account of minority interest.
Consolidated Net Tangible Assets shall be determined in accordance with generally accepted
accounting principles and practices applicable to the type of business in which the Company is
engaged and approved by the independent accountants regularly retained by the Company, and may be
determined as of a date not more than 60 days prior to the happening of the event for which such
determination is being made.

     “Subsidiary” means an entity more than 50% of the outstanding voting stock (or comparable
equity interest) of which is owned, directly or indirectly, by the Company or by one

 

 

or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the
purpose of this definition, “voting stock” means stock that ordinarily has voting power for the
election of directors, whether at all times or only so long as no senior class of stock has such
voting power by reasons of any contingency.

     “Sale and Leaseback Transaction” means any transaction or series of related transactions
relating to property now owned or hereafter acquired by the Company or any of its Subsidiaries
whereby the Company or one of its Subsidiaries transfers the property to a person and the Company
or one of its Subsidiaries leases the property from that person for a period, including renewals,
in excess of 48 months.

Optional Redemption

     The Notes of this series are subject to redemption prior to October 15, 2020 by the Company at
its option, in whole, at any time, or in part, from time to time, upon notice as provided in the
Indenture at a redemption price equal to the greater of (i) 100% of the principal amount of the
Notes then outstanding to be redeemed or (ii) the sum of the present values of the remaining
scheduled payments of principal and interest on the Notes being redeemed, discounted to the
redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate applicable to the Notes plus 20 basis points; plus, in each case, accrued and
unpaid interest on the principal amount being redeemed to the redemption date, such redemption
price to be set forth in an Officer’s Certificate delivered to the Trustee on or before the
redemption date and upon which the Trustee may conclusively rely.

     On or after October 15, 2020, the Notes of this series are subject to redemption by the
Company, at its option, in whole, at any time, or in part, from time to time, upon notice as
provided in the Indenture at a redemption price equal to 100% of the principal amount of the Notes
then outstanding to be redeemed plus accrued and unpaid interest on the principal amount being
redeemed to the redemption date.

     So long as the Notes are registered in the name of DTC, its nominee or a successor depositary,
if the Company elects to redeem less than all of the Notes, DTC’s practice is to determine by lot
the amount of the interest of each eligible DTC participant in the Notes to be redeemed. At all
other times, if the Company elects to redeem less than all of the Notes, the Trustee will select,
in such manner as it deems fair and appropriate, the particular Notes, or portions of them, to be
redeemed. Notice of redemption shall be given by mail not less than 30 nor more than 60 days prior
to the date fixed for redemption to the holders of Notes to be redeemed, which, as long as the
Notes are held in the book entry only system, will be DTC, its nominee or a successor depositary.
On and after the redemption date (unless the Company defaults in the payment of the applicable
redemption price and interest accrued thereon to such date), interest on the Notes, or the portions
of them so called for redemption, shall cease to accrue.

     In the event of redemption of this Note in part only, a new Note or Notes of this series and
of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof.

 

 

     As used in this subsection:

     “Comparable Treasury Issue” means the United States Treasury security or securities selected
by an Independent Investment Banker (as defined below) as having an actual or interpolated maturity
comparable to the remaining term of the Notes being redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of the Notes.

     “Comparable Treasury Price” means, with respect to any redemption date, the average of the
Reference Treasury Dealer Quotations (as defined below) for such redemption date.

     “Independent Investment Banker” means one of the Reference Treasury Dealer(s) (as defined
below) appointed by the Company.

     “Reference Treasury Dealer” means Deutsche Bank Securities Inc. or Morgan Stanley & Co.
Incorporated and their respective successors, and one additional primary U.S. Government securities
dealer in The City of New York (each a “Primary Treasury Dealer”) selected by the Company (which
may be Deutsche Bank Securities Inc. or Morgan Stanley & Co. Incorporated or their respective
successors). If any Reference Treasury Dealer shall cease to be a Primary Treasury Dealer, the
Company will substitute another Primary Treasury Dealer for that dealer.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Company, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Company by such Reference Treasury Dealer at 3:30 p.m. New York time on
the third Business Day preceding such redemption date.

     “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity or interpolated (on a day count basis) of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for such redemption date.

Certain Indenture Provisions

     The Indenture permits, in certain circumstances therein specified, the amendment thereof
without the consent of the Holders of any of the Debt Securities. The Indenture also permits, with
certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations under the Indenture of the Company and the rights of Holders of the Debt Securities
of each series to be affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of a specified percentage in aggregate principal amount of the Debt
Securities at the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of a specified percentage in aggregate principal amount of the
Debt Securities of each series at the time Outstanding, on behalf of the Holders of all the Debt
Securities of such series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.

 

 

Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon
such Holder and upon all future Holders of this Note and of any Note issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Note.

     As provided in and subject to the provisions of the Indenture, a Holder of Debt Securities
shall not have the right to institute any proceeding with respect to the Indenture or for the
appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall
have previously given the Trustee written notice of a continuing Event of Default with respect to
the Debt Securities of this series, the Holders of not less than a specified percentage in
aggregate principal amount of the Debt Securities of all series at the time Outstanding in respect
of which an Event of Default shall have occurred and be continuing shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered
the Trustee reasonable indemnity, and the Trustee shall not have received from the Holders of a
majority in principal amount of Debt Securities of all series at the time Outstanding in respect of
which an Event of Default shall have occurred and be continuing a direction inconsistent with such
request, and shall have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the
Holder of this Note for the enforcement of any payment of principal hereof or any premium or
interest hereon on or after the respective due dates expressed herein.

     No reference herein to the Indenture and no provision of this Note, subject to the provisions
for satisfaction and discharge in Article Seven of the Indenture, shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the principal of and
interest on this Note at the times, place, and rate, and in the coin or currency, herein
prescribed.

     The Indenture permits the Company, by irrevocably depositing, in amounts and maturities
sufficient to pay and discharge at the stated maturity or redemption date, as the case may be, the
entire indebtedness on all Outstanding Notes, cash or U.S. Government Obligations with the Trustee
in trust solely for the benefit of the Holders of all Outstanding Notes, to defease the Indenture
with respect to such Notes, and upon such deposit the Company shall be deemed to have paid and
discharged its entire indebtedness on such Notes. Thereafter, Holders would be able to look only
to such trust fund for payment of principal and interest at the stated maturity or redemption date,
as the case may be.

     The Notes are issuable only in registered form without coupons in denominations of $2,000 and
any integral multiples of $1,000 above such amount. As provided in the Indenture and subject to
certain limitations therein set forth, the transfer of Notes is registrable in the Debt Security
Register, upon surrender of a Note for registration of transfer at the Corporate Trust Office of
the Trustee or at such other offices or agencies of the Trustee from time to time designated for
such purpose, or at such other offices or agencies as the Company may designate, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Notes of like tenor, of authorized denominations and for the same
aggregate principal amount, shall be issued to the designated transferee or transferees.

 

 

     No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.

     Prior to due presentment of this Note for registration of transfer, the Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name this Note is
registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

     All undefined terms used in this Note that are defined in the Indenture shall have the
meanings assigned to them in the Indenture.exv10w1

Exhibit
10.1

HOLLIDAY FENOGLIO FOWLER, L.P.

AMENDED AND RESTATED PROFIT PARTICIPATION BONUS PLAN

Adopted: January 17, 2011

     1. Purpose. This Profit Participation Bonus Plan (the “Plan”) is established to
attract, retain and provide incentives to employees, and to promote the financial success, of
Holliday Fenoglio Fowler, L.P., a Texas limited partnership (the “Company”). Capitalized terms
shall have the meanings defined herein.

     2. Effective Date. The Plan is effective as provided herein.

     3. Applicability of Plan to Designated Offices. The Plan shall apply to each separate
office and/or line of business in each office of the Company (each, an “Office”) designated by the
Managing Member of the Company (the “Managing Member”).

     4. Office Bonus Pool Calculation.

          (a) Calculation of Office Bonus Pool. With respect to each Office to which the Plan
applies and for each calendar year (a “Plan Year”), if a fourteen and one-half percent (14.5%) or
greater Profit Margin (as defined below) is generated by such Office, as determined by the Managing
Member in accordance with the terms herein, then an amount equal to fifteen percent (15%) of the
Adjusted Operating Income (as defined below) generated by such Office, as determined by the
Managing Member in accordance with the terms herein, shall comprise the “Office Bonus Pool” for
such Office.

               (i) For purposes of the Plan, Profit Margin means the Net Operating Income (as defined below)
of such Office as a percentage of the revenue of such Office, all as determined in accordance with
U.S. Generally Accepted Accounting Principles applied on a consistent basis “GAAP”).

               (ii) For purposes of the Plan, Net Operating Income means net operating income (using the same
revenue and cost accounts as used in preparing the Company’s audited financial statements) of such
Office, which includes allocations for overhead expenses and servicing expenses, if applicable,
plus any gain on sale of mortgage servicing rights and securitization compensation from the
securitization of any Freddie Mac loans which the Company services.

               (iii) For purposes of the Plan, Adjusted Operating Income means the Net Operating Income of
such Office adjusted for depreciation and amortization.

          (b) Timing of Calculation. The amount of the Office Bonus Pool, if any, for each
Office to which the Plan applies shall be calculated as soon as reasonably practicable following
the closing of the books and records of the Company in accordance with GAAP in respect of the
applicable Plan Year (or on such later date determined by the Managing Member)

 

 

(the “Determination Date”) by the Chief Financial Officer of HFF, Inc. or his or her designee
(the “Chief Financial Officer”).

          (c) No Adjustment. The Office Bonus Pool shall not be adjusted based on any
information that becomes available at any time following the Determination Date, absent fraud,
accounting irregularities, willful misconduct, gross negligence or manifest error. The Office
Bonus Pool calculation performed on the Determination Date shall take in account all relevant
information available on that Determination Date.

          (d) Special Rule for Certain Offices.

               (i) Default Rule. For any Office in which both investment sales employees and debt
employees are employed, the investment sales group and the debt group shall be treated for all
purposes under the Plan as separate Offices and the head of each such group (each, a “Group Head”)
shall be treated for all purposes under the Plan as an Office Head.

               (ii) Election by Group Heads. Notwithstanding Section 4(d)(i) of the Plan, the Group
Heads in any Office at which both investment sales employees and debt employees are employed may,
prior to the beginning of a Plan Year, jointly elect (after consultation with the Managing Member)
to treat the investment sales group and the debt group at such Office as a single Office for all
purposes under the Plan by providing a joint notice of such election to the Chief Financial Officer
or his or her designee.

     5. Allocation of Office Bonus Pool.

          (a) Individual Eligibility. Each full-time or part-time employee of the Company is
eligible to receive a bonus payment under the Plan (a “Profit Participation Bonus”) with respect to
services performed during a Plan Year.

          (b) Allocation. For each Plan Year, each Office Head, in consultation with the
Managing Member, shall select the recipients of Profit Participation Bonuses and shall determine
the allocation of the Office Bonus Pool among such recipients (“Allocation Plan”).

          (c) Submission of Allocation Plan. Each Office Head shall submit the Allocation Plan
for the Plan Year to the Chief Financial Officer prior to the Determination Date.

          (d) Termination of Employment. Except as otherwise provided in an individual’s
employment agreement with the Company, if any, no individual shall be eligible to receive a Profit
Participation Bonus if the Company does not employ him or her on the date that the Profit
Participation Bonus is paid to the eligible individuals. Whether an individual is employed by the
Company on the date that the Profit Participation Bonus is paid to the eligible individuals shall
be determined in the sole and absolute discretion of the Managing Member.

     6. Payment of Profit Participation Bonus.

          (a) Subject to any applicable federal, state, local or other withholding taxes, Profit
Participation Bonuses shall be paid in accordance with each Office’s Allocation Plan within thirty
(30) days following the Determination Date, or, if determined by the Managing

2

 

Member with respect to any Office, on or before March 15 of the year following the Plan Year
with respect to which the Profit Sharing Bonus was earned.

          (b) The Board of Directors of HFF, Inc., or any appropriate committee thereof, may elect in
its sole discretion to pay up to one-third (1/3) of the Profit Participation Bonuses in the form of
equity-based awards pursuant to the HFF, Inc. 2006 Omnibus Incentive Compensation Plan (or any
other compensation plan adopted by HFF, Inc. under which equity securities of HFF, Inc. are
authorized); provided that any amounts of the Profit Participation Bonuses that are not paid in the
form of such equity-based awards shall be paid in cash; provided, further, notwithstanding anything
contained herein to the contrary, that any such equity-based awards shall comply in form with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and any such cash
payments shall be paid on or before March 15 of the year following the Plan Year with respect to
which the Profit Sharing Bonus was earned.

     7. Administration.

          (a) Managing Member. The Plan shall be administered by the Managing Member; provided
that any Profit Participation Bonuses to be paid to any executive officers of HFF, Inc. must be
approved in advance by the Board of Directors of HFF, Inc. or any appropriate committee thereof.
Except as otherwise provided herein, any action of the Managing Member in administering the Plan
shall be final, conclusive and binding on all persons, including the Company, its subsidiaries and
affiliates, any employee and any persons claiming rights from or through employees of the Company.

          (b) Powers of the Managing Member. Subject to the provisions of the Plan, the
Managing Member shall have full and final authority in his or her discretion (i) to construe and
interpret the Plan and to make all other determinations, including determinations as to the
eligibility of any employee to a benefit hereunder, as he or she may deem necessary or advisable
for the administration of the Plan, (ii) to correct any defect or supply any omission or reconcile
any inconsistency in the Plan, (iii) to adopt, amend and rescind such rules and regulations as, in
his or her opinion, may be advisable in the administration of the Plan, (iv) to require any person
to furnish such reasonable information as requested for the purpose of the proper administration of
the Plan as a condition to receiving any benefits under the Plan, and (v) to prepare and distribute
information explaining the Plan to employees.

          (c) Delegation. The Managing Member may delegate all or any portion of his or her
duties, responsibilities and powers under the Plan to the chief operating officer, chief financial
officer, any Office Head or Group Head, or any other employee of the Company as the Managing Member
deems appropriate. The Managing Member may revoke any such allocation or delegation at any time
for any reason with or without prior notice.

          (d) Indemnification. The Company shall indemnify and hold harmless the Managing
Member, each of his or her affiliates and/or agents and the Chief Financial Officer of HFF, Inc.
(or his or her designee) (each, a “Managing Member Indemnitee” and collectively the “Managing
Member Indemnitees”) from and against any and all liabilities, costs and expenses incurred by the
Managing Member Indemnitees as a result of any act or omission to act in connection with the
performance of the Managing Member’s or the Chief Financial Officer of

3

 

HFF, Inc.’s duties, responsibilities and obligations under the Plan, to the maximum extent
permitted by law, other than such liabilities, costs and expenses as may result from the gross
negligence, bad faith, willful misconduct or criminal acts of a Managing Member Indemnitee.

          (e) Payment of Administrative Expenses. All reasonable expenses incurred in
administering the Plan shall be paid by the Company.

     8. Recapitalization. The Managing Member shall determine, in his or her sole and
absolute discretion, the effect upon the Plan and the Profit Participation Bonuses payable
hereunder, if any, of any stock dividend, recapitalization, forward stock split or reverse stock
split, reorganization, division, merger, consolidation, spin-off, combination, repurchase or share
exchange, extraordinary or unusual cash distribution or other similar corporate transaction or
event.

     9. Limits on Transferability; Beneficiaries. No right or other interest of an
employee under the Plan shall be pledged, encumbered, or hypothecated to, or in favor of, or
subject to any lien, obligation, or liability of such employee to, any party, other than the
Company, or any of its subsidiaries or affiliates, or assigned or transferred by such employee
otherwise than by will or the laws of descent and distribution. Notwithstanding the foregoing, the
Managing Member may, in his or her sole and absolute discretion, provide that rights or other
interests of an employee under the Plan are transferable, without consideration, to immediate
family members (i.e., children, grandchildren or spouse), to trusts for the benefit of such
immediate family members and to partnerships in which such family members are the only partners.
The Managing Member may attach to such transferability feature such terms and conditions as he or
she deems advisable. In addition, an employee may, in the manner established by the Managing
Member, designate a beneficiary (which may be a person or a trust) to receive any payment under the
Plan upon the death of the Participant. A beneficiary, guardian, legal representative or other
person claiming any rights under the Plan from or through any employee shall be subject to all
terms and conditions of the Plan, except as otherwise determined by the Managing Member, and to any
additional restrictions deemed necessary or appropriate by the Managing Member.

     10. No Right to Future Employment. Nothing in this Plan, nor any Profit Participation
Bonus awarded under this Plan, shall confer on any employee or other person any right to be
continued in the employ of, be employed by, or enter into or maintain any other relationship with,
the Company, or limit in any way the right of the Company to terminate such person’s employment or
other relationship at any time, for any reason or no reason.

     11. No Right to Continued Participation. An employee’s receipt of a Profit
Participation Bonus under the Plan for a Plan Year shall not confer upon such employee the right to
receive a Profit Participation Bonus, or any particular amount of a Profit Participation Bonus, in
any subsequent Plan Year.

     12. Funding. The Plan shall be entirely unfunded at all times and no provision shall
be made with respect to segregating assets of the Company for payment of any benefit hereunder at
any time. No employee or other person shall have any interest in any particular assets of the
Company by reason of the right to receive a benefit under the Plan and any such employee or

4

 

other person shall have only the rights of a general unsecured creditor of the Company with
respect to any rights under the Plan.

     13. Amendment or Termination of Plan. The Plan may only be amended or terminated
through a writing executed by each limited partner and general partner of the Company.

     14. Successors. The Plan shall be binding upon, and inure to the benefit of, the
Company and its successors and assigns and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets
and business, and the successor shall be substituted for the Company under this Plan.

     15. Section 409A. To the extent determined necessary or advisable by the Managing
Member in his or her sole discretion, Profit Participation Bonus awards hereunder shall be
interpreted to the extent possible to comply with the provisions of section 409A of the Code (or
avoid application of such Code section), to the extent applicable.

     16. Headings. The titles and headings used in the Plan are intended for convenience
only and shall not be construed as in any way affecting or modifying the text of this Plan, which
text shall control.

     17. Governing Law. The obligations of the Company under this Plan shall be governed
by and construed and interpreted in accordance with the laws of the State of Texas, without regard
to the conflict of laws provisions thereof.

     18. Data Protection. By receiving a Profit Participation Bonus under the Plan, an
employee consents to the collection, processing, transmission and storage by the Company, in any
form whatsoever, of any data of a professional or personal nature which is necessary for the
purposes of administering the Plan.

5

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