Document:

x4-2.htm

    Exhibit
4.2

    

    

    
      
        

      

    

    

    

    

    

    GULF
POWER COMPANY

    

    TO

    

    THE
BANK OF NEW YORK MELLON,

    TRUSTEE

    

    

    

    

    

    

    SIXTEENTH
SUPPLEMENTAL INDENTURE

    

    DATED
AS OF APRIL 13, 2010

    

    

    

    

    

    

    

    

    SERIES
2010A 4.75% SENIOR NOTES

    

    DUE APRIL
15, 2020

    

    

    

    

    

    

    
      
        

      

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE OF CONTENTS1

    

    

    PAGE

    

     

    
      	
               
                      
                ARTICLE
      1

              

            	
              1

            

    

     

    
      	
               
                      
                Series
      2010A Senior Notes

              

            	
              1

            

    

    
      	
               
                      
                SECTION
      101.  Establishment

              

            	
              1

            

    

    
      	
               
                      
                SECTION
      102.  Definitions

              

            	
              2

            

    

    
      	
               
                      
                SECTION
      103.  Payment of Principal and
    Interest

              

            	
              3

            

    

    
      	
               
                      
                SECTION
      104.  Denominations

              

            	
              4

            

    

    
      	
               
                      
                SECTION
      105.  Global Securities

              

            	
              4

            

    

    
      	
               
                      
                SECTION
      106.  Transfer

              

            	
              4

            

    

    
      	
               
                      
                SECTION
      107.  Redemption at the Company’s
      Option

              

            	
              5

            

    

     

    
      	
               
                      
                ARTICLE
      2

              

            	
              5

            

    

     

    
      	
               
                      
                Miscellaneous
      Provisions

              

            	
              5

            

    

    
      	
               
                      
                SECTION
      201.  Recitals by Company

              

            	5

    

    
      	
               
                      
                SECTION
      202.  Ratification and Incorporation of Original
      Indenture

              

            	
              5

            

    

    
      	
               
                      
                SECTION
      203.  Executed in Counterparts

              

            	
              6

            

    

     
 

    EXHIBIT
A                      Form
of Series 2010A Note

    

    EXHIBIT
B                      Certificate
of Authentication

     

    

     

    

     

    

    

      

    

     

          1This
Table of Contents does not constitute part of the Indenture or have any bearing
upon the interpretation of any of its terms and provisions.

       

    

    
      
        
          
            	
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    THIS SIXTEENTH SUPPLEMENTAL INDENTURE
is made as of the 13th day
of April, 2010 by and between GULF POWER COMPANY, a Florida corporation, One
Energy Place, Pensacola, Florida 32520-0786 (the “Company”), and THE BANK OF NEW
YORK MELLON, a New York banking corporation, 101 Barclay Street, Floor 8W, New
York, New York  10286 (the “Trustee”).

    

    W I T N E
S S E T H:

    

    WHEREAS, the Company has heretofore
entered into a Senior Note Indenture, dated as of January 1, 1998 (the “Original
Indenture”), with The Bank of New York Mellon (as successor to JPMorgan Chase
Bank, N.A. (formerly known as The Chase Manhattan Bank)), as Trustee, as
heretofore supplemented;

    

    WHEREAS, the Original Indenture is
incorporated herein by this reference and the Original Indenture, as heretofore
supplemented and as further supplemented by this Sixteenth Supplemental
Indenture, is herein called the “Indenture”;

    

    WHEREAS, under the Original Indenture,
a new series of Senior Notes may at any time be established by the Board of
Directors of the Company in accordance with the provisions of the Original
Indenture and the terms of such series may be described by a supplemental
indenture executed by the Company and the Trustee;

    

    WHEREAS, the Company proposes to create
under the Indenture a new series of Senior Notes;

    

    WHEREAS, additional Senior Notes of
other series hereafter established, except as may be limited in the Original
Indenture as at the time supplemented and modified, may be issued from time to
time pursuant to the Indenture as at the time supplemented and modified;
and

    

    WHEREAS, all conditions necessary to
authorize the execution and delivery of this Sixteenth Supplemental Indenture
and to make it a valid and binding obligation of the Company have been done or
performed.

    

    NOW, THEREFORE, in consideration of the
agreements and obligations set forth herein and for other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties
hereto hereby agree as follows:

    

    

    ARTICLE
1

    

    Series
2010A Senior Notes

    

    SECTION 101.  Establishment.  There
is hereby established a new series of Senior Notes to be issued under the
Indenture, to be designated as the Company’s Series 2010A 4.75% Senior Notes due
April 15, 2020 (the “Series 2010A Notes”).

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    There are to be authenticated and
delivered $175,000,000 principal amount of Series 2010A Notes, and such
principal amount of the Series 2010A Notes may be increased from time to time
pursuant to Section 301 of the Original Indenture.  All Series 2010A
Notes need not be issued at the same time and such series may be reopened at any
time, without the consent of any Holder, for issuances of additional Series
2010A Notes.  Any such additional Series 2010A Notes will have the
same interest rate, maturity and other terms as those initially
issued.  No Series 2010A Notes shall be authenticated and delivered in
excess of the principal amount as so increased except as provided by
Sections 203, 303, 304, 907 or 1107 of the Original
Indenture.  The Series 2010A Notes shall be issued in fully registered
form.

    

    The Series 2010A Notes shall be issued
in the form of one or more Global Securities in substantially the form set out
in Exhibit A hereto.  The Depositary with respect to the Series 2010A
Notes shall be The Depository Trust Company.

    

    The form of the Trustee’s Certificate
of Authentication for the Series 2010A Notes shall be in substantially the form
set forth in Exhibit B hereto.

    

    Each Series 2010A Note shall be dated
the date of authentication thereof and shall bear interest from the date of
original issuance thereof or from the most recent Interest Payment Date to which
interest has been paid or duly provided for.

    

    The Series 2010A Notes will not have a
sinking fund.

    

    SECTION 102.  Definitions.  The
following defined terms used herein shall, unless the context otherwise
requires, have the meanings specified below.  Capitalized terms used
herein for which no definition is provided herein shall have the meanings set
forth in the Original Indenture.

    

    “Comparable Treasury Issue” means the
United States Treasury security selected by an Independent Investment Banker as
having a maturity comparable to the remaining term of the Series 2010A Notes to
be 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 Series 2010A
Notes.

    

    “Comparable Treasury Price” means, with
respect to any Redemption Date, (i) the average of the Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest such
Reference Treasury Dealer Quotations, or (ii) if the Company obtains fewer than
four such Reference Treasury Dealer Quotations, the average of all such
quotations.

    

    “Independent Investment Banker” means
an independent investment banking institution of national standing appointed by
the Company.

    

    “Interest
Payment Dates” means April 15 and October 15 of each year, commencing October
15, 2010.

    

    “Original Issue Date” means April 13,
2010.

    

    
      
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    “Redemption Price” has the meaning
given to it in Section 107 hereof.

    

    “Reference Treasury Dealer” means a
primary United States Government securities dealer appointed by the
Company.

    

    “Reference Treasury Dealer Quotation”
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 and quoted in writing to the Company by such Reference Treasury
Dealer at 5:00 p.m. on the third Business Day in New York City preceding such
Redemption Date).

    

    “Regular Record Date” means, with
respect to each Interest Payment Date, the 15th calendar day preceding such
Interest Payment Date (whether or not a Business Day).

    

    “Stated Maturity” means April 15,
2020.

    

    “Treasury Yield” means, with respect to
any Redemption Date, the rate per annum equal to the semiannual equivalent yield
to maturity 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.

    

    SECTION 103.  Payment of Principal and
Interest.  The principal of the Series 2010A Notes shall be due
at Stated Maturity (unless earlier redeemed).  The unpaid principal
amount of the Series 2010A Notes shall bear interest at the rate of 4.75% per
annum until paid or duly provided for.  Interest shall be paid
semiannually in arrears on each Interest Payment Date to the Person in whose
name the Series 2010A Notes are registered at the close of business on the
Regular Record Date for such Interest Payment Date, provided that interest
payable at the Stated Maturity or on a Redemption Date as provided herein will
be paid to the Person to whom principal is payable.  Any such interest
that is not so punctually paid or duly provided for will forthwith cease to be
payable to the Holders on such Regular Record Date and may either be paid to the
Person or Persons in whose name the Series 2010A Notes are 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
the Series 2010A Notes not less than ten (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, if any, on which the Series 2010A
Notes shall be listed, and upon such notice as may be required by any such
exchange, all as more fully provided in the Original Indenture.

    

    Payments of interest on the Series
2010A Notes will include interest accrued to but excluding the respective
Interest Payment Dates.  Interest payments for the Series 2010A Notes
shall be computed and paid on the basis of a 360-day year of twelve 30-day
months.  In the event that any date on which interest is payable on
the Series 2010A Notes is not a Business Day, then a payment of the interest
payable on such date will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay),
with the same force and effect as if made on the date the payment was originally
payable.

    

    
      
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    Payment of the principal and interest
due at the Stated Maturity or earlier redemption of the Series 2010A Notes shall
be made upon surrender of the Series 2010A Notes at the Corporate Trust Office
of the Trustee.  The principal of and interest on the Series 2010A
Notes shall be paid 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.  Payments of interest (including interest on any Interest
Payment Date) will be made, subject to such surrender where applicable, at the
option of the Company, (i) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or (ii) by wire
transfer or other electronic transfer at such place and to such account at a
banking institution in the United States as may be designated in writing to the
Trustee at least sixteen (16) days prior to the date for payment by the Person
entitled thereto.

    

    SECTION 104.  Denominations.  The
Series 2010A Notes may be issued in denominations of $1,000, or any integral
multiple thereof.

    

    SECTION 105.  Global
Securities.  The Series 2010A Notes will be issued in the form
of one or more Global Securities registered in the name of the Depositary (which
shall be The Depository Trust Company) or its nominee.  Except under
the limited circumstances described below, Series 2010A Notes represented by one
or more Global Securities will not be exchangeable for, and will not otherwise
be issuable as, Series 2010A Notes in definitive form.  The Global
Securities described above may not be transferred except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or to a successor Depositary or its
nominee.

    

    Owners of beneficial interests in such
a Global Security will not be considered the Holders thereof for any purpose
under the Indenture, and no Global Security representing a Series 2010A Note
shall be exchangeable, except for another Global Security of like denomination
and tenor to be registered in the name of the Depositary or its nominee or to a
successor Depositary or its nominee.  The rights of Holders of such
Global Security shall be exercised only through the Depositary.

    

    Subject to the procedures of the
Depositary, a Global Security shall be exchangeable for Series 2010A Notes
registered in the names of persons other than the Depositary or its nominee only
if (i) the Depositary notifies the Company that it is unwilling or unable to
continue as a Depositary for such Global Security and no successor Depositary
shall have been appointed by the Company, or if at any time the Depositary
ceases to be a clearing agency registered under the Securities Exchange Act of
1934, as amended, at a time when the Depositary is required to be so registered
to act as such Depositary and no successor Depositary shall have been appointed
by the Company, in each case within 90 days after the Company receives such
notice or becomes aware of such cessation, (ii) the Company in its sole
discretion determines that such Global Security shall be so exchangeable, or
(iii) there shall have occurred an Event of Default with respect to the Series
2010A Notes.  Any Global Security that is exchangeable pursuant to the
preceding sentence shall be exchangeable for Series 2010A Notes registered in
such names as the Depositary shall direct.

    

    SECTION 106.  Transfer.  No
service charge will be made for any transfer or exchange of Series 2010A Notes,
but payment will be required of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith.  The
Company shall not be required (a) to issue, transfer or exchange any Series
2010A Notes during a period beginning at the opening of business fifteen (15)
days before the date of the mailing of a notice pursuant to Section 1104 of the
Original Indenture identifying the serial numbers of the Series 2010A Notes to
be called for redemption, and ending at the close of business on the day of the
mailing, or (b) to transfer or exchange any Series 2010A Notes theretofore
selected for redemption in whole or in part, except the unredeemed portion of
any Series 2010A Note redeemed in part.

    

    
      
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    SECTION 107.  Redemption at the Company’s
Option.  The Series 2010A Notes will be subject to redemption
at the option of the Company, in whole or in part, at any time and from time to
time, upon not less than 30 nor more than 60 days’ notice, at a redemption price
(the “Redemption Price”) equal to the greater of (1) 100% of the principal
amount of the Series 2010A Notes to be redeemed or (2) the sum of the present
values of the remaining scheduled payments of principal and interest on the
Series 2010A Notes being redeemed (not including any portion of such payments of
interest accrued to the Redemption Date) discounted (for purposes of determining
present value) to the Redemption Date on a semiannual basis (assuming a 360-day
year consisting of twelve 30-day months) at a discount rate equal to the
Treasury Yield plus 15 basis points, plus, in each case, accrued interest
thereon to the Redemption Date.

    

    In the event of redemption of the
Series 2010A Notes in part only, a new Series 2010A Note or Notes for the
unredeemed portion will be issued in the name or names of the Holders thereof
upon the surrender thereof.

    

    Notice of redemption shall be given as
provided in Section 1104 of the Original Indenture except that any notice of
redemption shall not specify the Redemption Price but only the manner of
calculation thereof.  The Trustee shall not be responsible for the
calculation of the Redemption Price.  The Company shall calculate the
Redemption Price and promptly notify the Trustee thereof.

    

    Any redemption of less than all of the
Series 2010A Notes shall, with respect to the principal thereof, be divisible by
$1,000.

    

    ARTICLE
2

    

    Miscellaneous
Provisions

    

    SECTION 201.  Recitals by
Company.  The recitals in this Sixteenth Supplemental Indenture
are made by the Company only and not by the Trustee, and all of the provisions
contained in the Original Indenture in respect of the rights, privileges,
immunities, powers and duties of the Trustee shall be applicable in respect of
Series 2010A Notes and of this Sixteenth Supplemental Indenture as fully and
with like effect as if set forth herein in full.

    

    SECTION 202.  Ratification and
Incorporation of Original Indenture.  As heretofore
supplemented and as supplemented hereby, the Original Indenture is in all
respects ratified and confirmed, and the Original Indenture as heretofore
supplemented and as supplemented by this Sixteenth Supplemental Indenture shall
be read, taken and construed as one and the same instrument.

    

    
      
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    SECTION 203.  Executed in
Counterparts.  This Sixteenth Supplemental Indenture may be
simultaneously executed in several counterparts, each of which shall be deemed
to be an original, and such counterparts shall together constitute but one and
the same instrument.

    
      
        
          
            	
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    IN WITNESS WHEREOF, each party hereto
has caused this instrument to be signed in its name and behalf by its duly
authorized officers, all as of the day and year first above
written.

    

    
      	
              ATTEST:

               

              By:       /s/Terry
      A. Davis  

              Terry A. Davis

              Assistant Secretary
      and

              Assistant Treasurer

               

            	
              GULF
      POWER COMPANY

               

              By:      /s/Susan
      D. Ritenour  

              Susan D. Ritenour

              Secretary and
      Treasurer

               

            
	 
      	 
      
	
              ATTEST:

               

              By:       /s/Christopher
      Greene  

              Christopher Greene

              Vice President

               

            	
              THE
      BANK OF NEW YORK MELLON, as Trustee

               

              By:          /s/Laurence
      J. O'Brien 

              Laurence J. O’Brien

              Vice President

               

            

    

    

    
      
        
          
            	
                     

                  

          

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
A

    

    FORM OF
SERIES 2010A NOTE

    

    

    
      
        
          
            	
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    NO.
____ CUSIP NO. 402479 CA5

    

    

    GULF
POWER COMPANY

    SERIES
2010A 4.75% SENIOR NOTE

    DUE APRIL
15, 2020

    

    

    
      	
              Principal
      Amount:

            	
              $_____________

            
	
              Regular
      Record Date:

            	
              15th
      calendar day prior to Interest Payment Date (whether or not a Business
      Day)

            
	
              Original
      Issue Date:

            	
              April
      13, 2010

            
	
              Stated
      Maturity:

            	
              April
      15, 2020

            
	
              Interest
      Payment Dates:

            	
              April
      15 and October 15

            
	
              Interest
      Rate:

            	
              4.75%
      per annum

            
	
              Authorized
      Denominations:

            	
              $1,000
      or any integral multiple thereof

            

    

    

    

    Gulf Power Company, a Florida
corporation (the “Company,” which term includes any successor corporation under
the Indenture referred to on the reverse hereof), for value received, hereby
promises to pay to _____________________, or registered assigns, the principal
sum of ___________________________DOLLARS ($___________) on the Stated Maturity
shown above (or upon earlier redemption), and to pay interest thereon from the
Original Issue Date shown above, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, semiannually in arrears on
each Interest Payment Date as specified above, commencing October 15, 2010, and
on the Stated Maturity (or upon earlier redemption) at the rate per annum shown
above until the principal hereof is paid or made available for payment and at
such rate on any overdue principal and on any overdue installment of
interest.  The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date (other than an Interest Payment Date
that is the Stated Maturity or on a Redemption Date) will, as provided in such
Indenture, be paid to the Person in whose name this Note (the “Note”) is
registered at the close of business on the Regular Record Date as specified
above next preceding such Interest Payment Date, provided that any interest
payable at the Stated Maturity or on any Redemption Date will be paid to the
Person to whom principal is payable.  Except as otherwise provided in
the Indenture, 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 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, if any, on which the Notes of this series shall be listed,
and upon such notice as may be required by any such exchange, all as more fully
provided in the Indenture.

    

    Payments of interest on this Note will
include interest accrued to but excluding the respective Interest Payment
Dates.  Interest payments for this Note shall be computed and paid on
the basis of a 360-day year of twelve 30-day months.  In the event
that any date on which interest is payable on this Note is not a Business Day,
then payment of the interest payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay), with the same force and effect as if made on the
date the payment was originally payable.  A “Business Day” shall mean
any day other than a Saturday or a Sunday or a day on which banking institutions
in New York City are authorized or required by law or executive order to remain
closed or a day on which the Corporate Trust Office of the Trustee is closed for
business.

    

    Payment of the principal of and
interest due at the Stated Maturity or earlier redemption of the Series 2010A
Notes shall be made upon surrender of the Series 2010A Notes at the Corporate
Trust Office of the Trustee.  The principal of and interest on the
Series 2010A Notes shall be paid 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.  Payment of interest (including interest on an Interest
Payment Date) will be made, subject to such surrender where applicable, at the
option of the Company, (i) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or (ii) by wire
transfer or other electronic transfer at such place and to such account at a
banking institution in the United States as may be designated in writing to the
Trustee at least 16 days prior to the date for payment by the Person entitled
thereto.

    

    REFERENCE IS HEREBY MADE TO THE FURTHER
PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, 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 by manual signature, this
Note shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

    

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

    

    Dated:

    

    
      	 
      	
              GULF
      POWER COMPANY

               

               

               

              By:    _____________________________________________                                                                       

              Title:

            
	 
      	 
      
	
              Attest:

               

               

              _________________________________________

              Title:

               

            	 
      

    

    

    

    

    {Seal of
GULF POWER COMPANY appears here}

    

    

    

    

    

    

    

    
      
        
          

           

          

          

          
            	
                     

                  

          

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    CERTIFICATE
OF AUTHENTICATION

    

    This is one of the Senior Notes
referred to in the within-mentioned Indenture.

    

    

    

    
      	 
      	
              THE
      BANK OF NEW YORK MELLON,

              as
      Trustee

               

               

              By:  ______________________________________                                                                        

              Authorized
    Signatory

            

    

    
      
        
          
            	
                     

                  

          

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    (Reverse
Side of Note)

    

    

    This Note is one of a duly authorized
issue of Senior Notes of the Company (the “Notes”), issued and issuable in one
or more series under a Senior Note Indenture, dated as of January 1, 1998, as
supplemented (the “Indenture”), between the Company and The Bank of New York
Mellon (as successor to JPMorgan Chase Bank, N.A. (formerly known as The Chase
Manhattan Bank)), as Trustee (the “Trustee,” which term includes any successor
trustee under the Indenture), to which Indenture and all indentures incidental
thereto reference is hereby made for a statement of the respective rights,
limitation of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Notes issued thereunder and of the terms upon
which said Notes are, and are to be, authenticated and
delivered.  This Note is one of the series designated on the face
hereof as Series 2010A 4.75% Senior Notes due April 15, 2020 (the “Series 2010A
Notes”) which is unlimited in aggregate principal amount.  Capitalized
terms used herein for which no definition is provided herein shall have the
meanings set forth in the Indenture.

    

    The Series 2010A Notes will be subject
to redemption at the option of the Company, in whole or in part, at any time and
from time to time, upon not less than 30 nor more than 60 days’ notice at a
redemption price (the “Redemption Price”) equal to the greater of (i) 100% of
the principal amount of the Series 2010A Notes to be redeemed or (ii) the sum of
the present values of the remaining scheduled payments of principal and interest
on the Series 2010A Notes being redeemed (not including any portion of such
payments of interest accrued to the Redemption Date) discounted (for purposes of
determining present value) to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at a discount rate
equal to the Treasury Yield plus 15 basis points, plus, in each case, accrued
interest thereon to the Redemption Date.

    

    “Treasury Yield” means, with respect to
any Redemption Date, the rate per annum equal to the semiannual equivalent yield
to maturity 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.

    

    “Comparable Treasury Issue” means the
United States Treasury security selected by an Independent Investment Banker as
having a maturity comparable to the remaining term of the Series 2010A Notes to
be 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 Series 2010A
Notes.

    

    “Comparable Treasury Price” means, with
respect to any Redemption Date, (i) the average of the Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest such
Reference Treasury Dealer Quotations, or (ii) if the Company obtains fewer than
four such Reference Treasury Dealer Quotations, the average of all such
quotations.

    

    “Independent Investment Banker” means
an independent investment banking institution of national standing appointed by
the Company.

    

    
      
        5

      

      
         

        
          

        

      

      
         

      

    

    “Reference Treasury Dealer” means a
primary United States Government securities dealer appointed by the
Company.

    

    “Reference Treasury Dealer Quotation”
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 and quoted in writing to the Company by such Reference Treasury
Dealer at 5:00 p.m. on the third Business Day in New York City preceding such
Redemption Date).

    

    The Trustee shall not be responsible
for the calculation of the Redemption Price.  The Company shall
calculate the Redemption Price and promptly notify the Trustee
thereof.

    

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

    

    The Series 2010A Notes will not have a
sinking fund.

    

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

    

    The Indenture permits, with certain
exceptions as therein provided, the amendment thereof and the modification of
the rights and obligations of the Company and the rights of the Holders of the
Notes 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 not less than a
majority in principal amount of the Notes at the time Outstanding of each series
to be affected.  The Indenture also contains provisions permitting the
Holders of specified percentages in principal amount of the Notes of each series
at the time Outstanding, on behalf of the Holders of all Notes 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 hereof or in
lieu hereof, whether or not notation of such consent or waiver is made upon this
Note.

    

    No reference herein to the Indenture
and no provision of this Note or 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.

    

    As provided in the Indenture and
subject to certain limitations therein set forth, the transfer of this Note is
registrable in the Security Register, upon surrender of this Note for
registration of transfer at the office or agency of the Company for such
purpose, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar and duly executed
by, the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes of this series, of 

     

     

    
      
        6

      

      
         

        
          

        

      

      
         

      

    

     

    authorized
denominations and of like tenor and for the same aggregate principal amount,
will 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.

    

    The Notes of this series are issuable
only in registered form without coupons in denominations of $1,000 and any
integral multiple thereof.  As provided in the Indenture and subject
to certain limitations therein set forth, Notes of this series are exchangeable
for a like aggregate principal amount of Notes of this series of a different
authorized denomination, as requested by the Holder surrendering the same upon
surrender of the Note or Notes to be exchanged at the office or agency of the
Company.

    

    This Note shall be governed by, and
construed in accordance with, the internal laws of the State of New
York.

    

    

    

    

    

    
      
        
          
            	
                    7

                  

          

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    ABBREVIATIONS

    

    The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

    

    
      	
              TEN
      COM-

            	
              as
      tenants in

              common

            	
              UNIF
      GIFT MIN ACT- _______ Custodian ________

                                                        
      (Cust)                          (Minor)

            
	
              TEN
      ENT-

            	
              as
      tenants by the

               entireties

            	 
      	 
      
	
              JT
      TEN-

            	
              as
      joint tenants

            	 
      	
              under
      Uniform Gifts to

            
	 
      	
              with
      right of

            	 
      	
              Minors
      Act

            
	 
      	
              survivorship
      and

            	 
      	 
      
	 
      	
              not
      as tenants

            	 
      	
              ________________________

            
	 
      	
              in
      common

            	 
      	
              (State)

            

    

    

    Additional
abbreviations may also be used

    though
not on the above list.

    

    

    FOR VALUE RECEIVED, the undersigned
hereby sell(s) and transfer(s) unto

    

    (please
insert Social Security or other identifying number of assignee)

    

    

    PLEASE
PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE

    

    

    

    the
within Note and all rights thereunder, hereby irrevocably constituting and
appointing

    

    

    

    agent to
transfer said Note on the books of the Company, with full power of substitution
in the premises.

    

    

    
      	
              Dated:                                           

            	 
      
	 
      	 
      

    

    

    NOTICE:  The
signature to this assignment must correspond with the name as written upon the
face of the within instrument in every particular without alteration or
enlargement, or any change whatever.

    

    

    
      
        
          
            	
                    8

                  

          

          

        

         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
B

    

    

    CERTIFICATE
OF AUTHENTICATION

    

    

    This is one of the Senior Notes
referred to in the within-mentioned Indenture.

    

    
      	 
      	
              THE
      BANK OF NEW YORK MELLON,

              as
      Trustee

               

               

              By:                                                                       

              Authorized Signatory

               

            

    

    
      
        
          
            	
                    9form8kexhibit101_041210.htm

Exhibit 10.1

 

 

 

CHANGE IN TERMS AGREEMENT

 

	
Principal

$4,424,392.04

	
Loan Date

03-31-2010

	
Maturity

01-10-2011

	
Loan No

1089922418

	
Call / Coll

410 /4

	
Account

MACC PE00

	
Officer

755

	
Initials

	
References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.

Any item above containing “***” has been omitted due to text length limitations.

	
Borrower:

	
MACC PRIVATE EQUITIES, INC.

101 2ND ST SE SUITE 800

CEDAR RAPIDS, IA 52401-1219

 

	
Lender:

	
CEDAR RAPIDS BANK AND TRUST COMPANY

500 1st AVENUE NE STE 100

CEDAR RAPIDS, IA  52401

Principal Amount:                                $4,424,392.04                                                                           Date of Agreement:                                           March 31, 2010

DESCRIPTION OF EXISTING INDEBTEDNESS.   Promissory Note dated 8/14/2009 in the amount of $4,814,022.34 with an original maturity date of 3/31/2010.

 

DESCRIPTION OF COLLATERAL.  Business Loan Agreement dated August 30, 2007 as amended by an Omnibus Amendment, Consent and Waiver dated April 29, 2008, and Second Amendment to Business Loan Agreement and Security Agreements dated August 14, 2009, and Third Amendment to Business Loan Agreement and Security Agreements dated March 31, 2010 (collectively the "Loan Agreement"); Commercial Security Agreement dated August 30, 2007 as amended by an Omnibus Amendment, Consent and Waiver dated April 29, 2008, and Second Amendment to Business Loan Agreement and Security Agreements dated August 14, 2009, and Third Amendment to Business Loan Agreement and Security Agreements dated March 31, 2010 (collectively the "Commercial Security Agreement"); Commercial Pledge and Security Agreement dated August 30, 2007 as amended by an Omnibus Amendment, Consent and Waiver dated April 29, 2008, and Second Amendment to Business Loan Agreement and Security Agreements dated August 14, 2009, and Third Amendment to Business Loan Agreement and Security Agreements dated March 31, 2010 (collectively the "Commercial Pledge and Security Agreement").

 

DESCRIPTION OF CHANGE IN TERMS.  The maturity date is being extended from 3/31/2010 to 1/10/2011.

 

The verbiage under the heading "Collateral" in the Promissory Note is hereby deleted in its entirety and replaced with the verbiage under the heading "Description of Collateral" above.

 

PAYMENT.  Borrower will pay this loan in one principal payment of $4,424,392.04 plus interest on January 10, 2011.  This payment due on January 10, 2011, will be for all principal and all accrued interest not yet paid.  In addition, Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning April 30, 2010, with all subsequent interest payments to be due on the last day of each month after that.

 

VARIABLE INTEREST RATE.  The interest rate on this loan is subject to change from time to time based on changes in an independent index which is the Wall Street Journal Prime as published in The Wall Street Journal (the "Index").  The Index is not necessarily the lowest rate charged by Lender on its loans.  If the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower.  Lender will tell Borrower the current Index rate upon Borrower's request.  The interest rate change will not occur more often than each day.  Borrower understands that Lender may make loans based on other rates as well.  The Index currently is 3.250% per annum. Interest on the unpaid principal balance of this loan will be calculated as described in the "INTEREST CALCULATION METHOD" paragraph using a rate of 2.000 percentage points over the Index, adjusted if necessary for any minimum and maximum rate limitations described below, resulting in an initial rate of 6.000% per annum based on a year of 360 days.  NOTICE: Under no circumstances will the interest rate on this loan be less than 6.000% per annum or more than the maximum rate allowed by applicable law.

 

INTEREST CALCULATION METHOD.  Interest on this loan is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.  All interest payable under this loan is computed using this method.

 

CONTINUING VALIDITY.  Except as expressly changed by this Agreement, the terms of the original obligation or obligations, including all agreements evidenced or securing the obligation(s), remain unchanged and in full force and effect.  Consent by Lender to this Agreement does not waive Lender's right to strict performance of the obligation(s) as changed, nor obligate Lender to make any future change in terms.  Nothing in this Agreement will constitute a satisfaction of the obligation(s).  It is the intention of Lender to retain as liable parties all makers and endorsers of the original obligation(s), including accommodation parties, unless a party is expressly released by Lender in writing.  Any maker or endorser, including accommodation makers, will not be released by virtue of this Agreement.  If any person who signed the original obligation does not sign this Agreement below, then all persons signing below acknowledge that this Agreement is given conditionally, based on the representation to Lender that the non-signing party consents to the changes and provisions of this Agreement or otherwise will not be released by it.  This waiver applies not only to any initial extension, modification or release, but also to all such subsequent actions.

 

PURPOSE OF LOAN.  The purpose of this loan is for: consolidate #1089921655 and #1089921654 into one term note.

 

	
CHANGE IN TERMS AGREEMENT

Loan No. 1089922418                                                                        (Continued)                                                                           Page 2

PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS AGREEMENT, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS.  BORROWER AGREES TO THE TERMS OF THE AGREEMENT.

 

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS CHANGE IN TERMS AGREEMENT AND ALL OTHER DOCUMENTS RELATING TO THIS DEBT.

 

CHANGE IN TERMS SIGNERS:

 

 

	MACC PRIVATE EQUITIES INC.	 
	 	 
	By: /s/ Travis Prentice	 By:  /s/ Derek J. Gaertner 
	Travis T. Prentice, President & CEO of MACC	Derek J. Gaertner, CFO & CCO of MACC PRIVATE
	PRIVATE EQUITIES INC.	EQUITIES INC.
	 	 

 

          

 

LENDER:

 

	 CEDAR RAPIDS BANK AND TRUST COMPANY	 
	 	 
	 X    /s/ John Hall     	 
	John Hall, Asst. Vice President	 

 

     

	  

LASER PRO Lending Ver. 5.48.10.001 Copr. Harland Financial Solutions, Inc. 1997, 2010.  All Rights Reserved – IA W:\CRB\CFNLPL\DOC20C.FC  TR-4780 PR-9

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