-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, D/KBUEyXNSbQx0nN5IPM3EGGKT5yP8y3mW72X7wLgkzURsUPkaukU++3xG0LsKL/ +kVjH2dnvJe2I+wGeZU2jA== 0000950144-99-001746.txt : 19990217 0000950144-99-001746.hdr.sgml : 19990217 ACCESSION NUMBER: 0000950144-99-001746 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 34 CONFORMED PERIOD OF REPORT: 19981230 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990216 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KOGER EQUITY INC CENTRAL INDEX KEY: 0000835664 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 592898045 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 333-20975 FILM NUMBER: 99539019 BUSINESS ADDRESS: STREET 1: 8880 FREEDOM CROSSING TRAIL CITY: JACKSONVILLE STATE: FL ZIP: 32256 BUSINESS PHONE: 9047321000 MAIL ADDRESS: STREET 1: 8880 FREEDOM CROSSING TRAIL CITY: JACKSONVILLE STATE: FL ZIP: 32256 8-K 1 KOGER EQUITY INC 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) December 30, 1998 KOGER EQUITY, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Florida 1-9997 59-2898045 - -------------------------------------------------------------------------------- (State of incorporation (Commission (IRS Employer or organization) File Number) Identification No.) 8880 Freedom Crossing Trail Jacksonville, Florida 32256 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code)
Registrant's telephone number: (904) 732-1000 - -------------------------------------------------------------------------------- N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) 2 Item 5. Other Events. Reference is made to copies of loan documents dated as of December 30, 1998 evidencing a $150 million revolving credit facility provided Koger Equity, Inc. ("Koger") by First Union National Bank ("First Union") formerly known as First Union National Bank of Florida, AmSouth Bank ("AmSouth"), Guaranty Federal Bank F.S.B. ("Guaranty Federal"), Citizens Bank of Rhode Island ("Citizens") and Compass Bank ("Compass") (collectively, the "Lenders"), which documents are filed as Exhibits 10(k)(1) through 10(k)(7)(d) to this report and to a Koger News Release dated January 5, 1999 concerning the same matter, which is Exhibit 99 to this Report. These exhibits are incorporated herein by reference. Item 7. Financial Statements and Exhibits. (c) Exhibits
Exhibit Number Description of Exhibit -------------- ---------------------- 10(k)(1) The Second Amended and Restated Revolving Credit Loan Agreement, dated as of December 30, 1998, between and among Koger and the Lenders. 10(k)(2)(a) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to First Union in the principal amount of up to $45,000,000. 10(k)(2)(b) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to AmSouth in the principal amount of up to $35,000,000. 10(k)(2)(c) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to Guaranty Federal in the principal amount of up to $35,000,000. 10(k)(2)(d) The Revolving Promissory Note, dated December 30, 1998, issued by Koger to Citizens in the principal amount of up to $20,000,000. 10(k)(2)(e) The Revolving Promissory Note, dated December 30, 1998, issued by Koger to Compass in the principal amount of up to $15,000,000. 10(k)(3)(a) The Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998,
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Exhibit Number Description of Exhibit -------------- ---------------------- relating to that portion of the Collateral located in the State of Alabama. 10(k)(3)(b) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Alabama. 10(k)(3)(c) The Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Alabama. 10(k)(3)(d) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Alabama. 10(k)(4)(a)(i) The Second Amended and Restated Deed to Secure Debt and Spreader, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(a)(ii) The Amendment to Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(a)(iii) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(a)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(b)(i) The Deed to Secure Debt, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia. 10(k)(4)(b)(ii) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia.
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Exhibit Number Description of Exhibit -------------- ---------------------- 10(k)(4)(b)(iii) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia. 10(k)(4)(b)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia [included within the document listed above in Exhibit 10(k)(4)(a)(iv)]. 10(k)(5)(a)(i) The Second Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Guilford County, State of North Carolina. 10(k)(5)(a)(ii) The Amended and Restated Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Guilford County, State of North Carolina. 10(k)(5)(a)(iii) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in both Guilford and Mecklenburg Counties, State of North Carolina. 10(k)(5)(a)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in both Guilford and Mecklenburg Counties, State of North Carolina. 10(k)(5)(b)(i) The Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated as of December 30, 1998, relating to that portion of Collateral located in Mecklenburg County, State of North Carolina. 10(k)(5)(b)(ii) The Amended and Restated Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Mecklenburg County, State of North Carolina.
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Exhibit Number Description of Exhibit -------------- ---------------------- 10(k)(5)(b)(iii) The Amended and Restated Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of South Carolina. 10(k)(6)(a) The Amendment to Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of South Carolina. 10(k)(6)(b) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of South Carolina. 10(k)(6)(c) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of South Carolina. 10(k)(7)(a) The Deed of Trust, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Texas. 10(k)(7)(b) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Texas. 10(k)(7)(c) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Texas. 10(k)(7)(d) The Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Texas. 10(k)(8) Unconditional Guaranty, dated December 30, 1998, of Koger Real Estate Services, Inc. and Southeast Properties Holding Corporation, Inc, both wholly owned of Koger to perform and make payments pursuant to the Second Amended and Restated Revolving Credit Loan Agreement. 99 Koger Equity, Inc. News Release dated January 5, 1999.
5 6 SIGNATURE Pursuant to the Requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KOGER EQUITY, INC. Date: February 12, 1999 By: /s/ James L. Stephens --------------------------------------- James L. Stephens Title: Vice President and Chief Accounting Officer 6 7 EXHIBIT INDEX The following designated exhibits are filed herewith:
Exhibit - ------- 10(k)(1) The Second Amended and Restated Revolving Credit Loan Agreement, dated as of December 30, 1998, between and among Koger and the Lenders. 10(k)(2)(a) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to First Union in the principal amount of up to $45,000,000. 10(k)(2)(b) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to AmSouth in the principal amount of up to $35,000,000. 10(k)(2)(c) The Substitution Revolving Promissory Note, dated December 30, 1998, issued by Koger to Guaranty Federal in the principal amount of up to $35,000,000. 10(k)(2)(d) The Revolving Promissory Note, dated December 30, 1998, issued by Koger to Citizens in the principal amount of up to $20,000,000. 10(k)(2)(e) The Revolving Promissory Note, dated December 30, 1998, issued by Koger to Compass in the principal amount of up to $15,000,000. 10(k)(3)(a) The Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Alabama. 10(k)(3)(b) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Alabama. 10(k)(3)(c) The Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Alabama. 10(k)(3)(d) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Alabama. 10(k)(4)(a)(i) The Second Amended and Restated Deed to Secure Debt and Spreader, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia.
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Exhibit - ------- 10(k)(4)(a)(ii) The Amendment to Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(a)(iii) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(a)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in DeKalb County, State of Georgia. 10(k)(4)(b)(i) The Deed to Secure Debt, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia. 10(k)(4)(b)(ii) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia. 10(k)(4)(b)(iii) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia. 10(k)(4)(b)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in Gwinnett County, State of Georgia [included within the document listed above in Exhibit 10(k)(4)(a)(iv)]. 10(k)(5)(a)(i) The Second Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in Guilford County, State of North Carolina. 10(k)(5)(a)(ii) The Amended and Restated Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Guilford County, State of North Carolina. 10(k)(5)(a)(iii) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in both Guilford and Mecklenburg Counties, State of North Carolina.
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Exhibit - ------- 10(k)(5)(a)(iv) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral located in both Guilford and Mecklenburg Counties, State of North Carolina. 10(k)(5)(b)(i) The Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated as of December 30, 1998, relating to that portion of Collateral located in Mecklenburg County, State of North Carolina. 10(k)(5)(b)(ii) The Amended and Restated Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in Mecklenburg County, State of North Carolina. 10(k)(5)(b)(iii) The Amended and Restated Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of South Carolina. 10(k)(6)(a) The Amendment to Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of South Carolina. 10(k)(6)(b) The Amendment to Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of South Carolina. 10(k)(6)(c) The Amendment to Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of South Carolina. 10(k)(7)(a) The Deed of Trust, Assignment of Leases and Rents, and Security Agreement, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Texas. 10(k)(7)(b) The Assignment of Leases and Rents, dated as of December 30, 1998, relating to that portion of the Collateral located in the State of Texas. 10(k)(7)(c) The Environmental Indemnification Agreement, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Texas. 10(k)(7)(d) The Assignment of Contracts, Licenses and Permits, dated as of December 30, 1998, relating to that portion of the Collateral in the State of Texas. 10(k)(8) Unconditional Guaranty, dated December 30, 1998, of Koger Real Estate Services, Inc. and Southeast Properties Holding Corporation, Inc, both wholly owned of Koger to perform and make payments pursuant to the Second Amended and Restated Revolving Credit Loan Agreement. 99 Koger Equity, Inc. News Release dated January 5, 1999.
9 EX-10.(K)(1) 2 2ND AMENDED & RESTATED REVOLVING CREDIT LOAN AGRMT 1 EXHIBIT 10(k)(1) U.S. $150,000,000 SECOND AMENDED AND RESTATED REVOLVING CREDIT LOAN AGREEMENT Dated as of December 30 , 1998 between KOGER EQUITY, INC. as Borrower and FIRST UNION NATIONAL BANK, AS ADMINISTRATIVE AGENT AND ARRANGER AMSOUTH BANK, AS SYNDICATION AGENT, AND THE LENDERS 2 TABLE OF CONTENTS ARTICLE I DEFINITIONS AND ACCOUNTING TERMS.......................................................1 SECTION 1.1 Certain Defined Terms.........................................................1 SECTION 1.2 Accounting Terms.............................................................14 ARTICLE 2 AMOUNT AND TERMS OF ADVANCES..........................................................14 SECTION 2.1 Advances.....................................................................14 (a) Advances.....................................................................14 (b) Letter of Credit.............................................................14 (c) Terms of Letters of Credit...................................................15 (d) Requests for Issuance of Letter of Credit....................................15 (e) Reimbursement Obligations....................................................15 (f) Effect of Letters of Credit on Commitments...................................15 (g) Agent's Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement Obligation.............................16 (h) Amendments, Etc..............................................................17 (i) Lenders' Participation in Letters of Credit..................................17 (j) Information to Lenders.......................................................17 SECTION 2.2 Making Advances..............................................................17 SECTION 2.3 Swing Line Advances..........................................................19 SECTION 2.4 Fees.........................................................................21 SECTION 2.5 Repayment of Advances; Prepayments...........................................21 SECTION 2.6 Interest Rate; Default Rate..................................................23 SECTION 2.7 Payments and Computations....................................................23 SECTION 2.8 Evidence of Indebtedness.....................................................24 SECTION 2.9 Prior LIBOR Advances.........................................................24 SECTION 2.10 Advances Under Prior Loan Agreement..........................................24 SECTION 2.11 Increase to Loan Amount......................................................24 ARTICLE III CONDITIONS OF LENDING AND FINANCIAL COVENANTS.........................................25 SECTION 3.1 Conditions Precedent to Advances and Financial Covenants....................................................................25 SECTION 3.2 Conditions Precedent to Certain Advances.....................................27 SECTION 3.3 Eligible Borrowing Base......................................................28 ARTICLE IV ADDITION, SUBSTITUTION AND RELEASE OF COLLATERAL............................................................................29 SECTION 4.1 General Right to Add, Substitute or Release Collateral.......................29 SECTION 4.2 Requirements for Release of Collateral.......................................30 SECTION 4.3 Requirements for Addition or Substitution of Collateral......................30 SECTION 4.4 Lenders' Approval of Addition or Substitution of Collateral...................................................................33
3 ARTICLE V CERTAIN MATTERS CONCERNING THE COLLATERAL.............................................34 SECTION 5.1 Inspections..................................................................34 SECTION 5.2 Appraisals...................................................................34 SECTION 5.3 Insurance....................................................................34 SECTION 5.4 Taxes and Assessments........................................................35 SECTION 5.5 Tax and Insurance Deposits...................................................35 SECTION 5.6 Tax Service Contract; Annual Tax Searches....................................36 SECTION 5.7 Due on Sale..................................................................36 SECTION 5.8 Loss and Restoration following Casualty or Condemnation.................................................................36 ARTICLE VI REPRESENTATIONS AND WARRANTIES........................................................37 SECTION 6.1 Representations and Warranties of Borrower...................................37 ARTICLE VII COVENANTS OF BORROWER.................................................................39 SECTION 7.1 Affirmative Covenants........................................................39 (a) Costs and Expenses...........................................................40 (b) Rent Roll....................................................................40 (c) Compliance with Governmental Requirements....................................40 (d) Preservation of Corporate Existence..........................................40 (e) Preservation and Maintenance of Collateral...................................41 (f) Reporting Requirements.......................................................41 (g) Notice of Failure to Perform.................................................42 SECTION 7.2 Negative Covenants...........................................................42 (a) Use of Loan Proceeds.........................................................42 (b) Structural Alterations.......................................................42 (c) Change in Nature of Business.................................................42 (d) Transactions with Subsidiaries...............................................42 ARTICLE VIII DEFAULT...............................................................................42 SECTION 8.1 Events of Default............................................................42 SECTION 8.2 Remedies following an Event of Default.......................................44 SECTION 8.3 Default Interest.............................................................44 SECTION 8.4 Remedies Cumulative..........................................................44 ARTICLE IX THE AGENT.............................................................................45 SECTION 9.1 Appointment, Powers and Immunities...........................................45 SECTION 9.2 Reliance.....................................................................46 SECTION 9.3 Defaults.....................................................................47 SECTION 9.4 Rights as a Lender...........................................................47 SECTION 9.5 Indemnification..............................................................47 SECTION 9.6 Non-Reliance on Agent and Other Lenders......................................48 SECTION 9.7 Failure to Act...............................................................48 SECTION 9.8 Resignation of Agent.........................................................48 SECTION 9.9 No Partnership...............................................................49 SECTION 9.10 Collateral...................................................................49
4 ARTICLE X OBLIGATIONS AND RIGHTS OF THE LENDERS.................................................49 SECTION 10.1 Custody of Loan Documents....................................................49 SECTION 10.2 Account Records..............................................................50 SECTION 10.3 Collections of Payments......................................................50 SECTION 10.4 Standard of Care.............................................................50 SECTION 10.5 Payment; Set Offs and Banker's Liens.........................................50 SECTION 10.6 Selection and Adjustment of Interest Rates...................................50 SECTION 10.7 Disbursements for Protection of Collateral and Collection and Enforcement of Obligations...............................................51 ARTICLE XI ENFORCEMENT OF THE LOAN...............................................................51 SECTION 11.2 Waiver of Default and Modification...........................................52 SECTION 11.3 Foreclosure or Exercise of Power of Sale.....................................52 SECTION 11.4 Disposition of Collateral After Foreclosure or Exercise of Power of Sale................................................................52 ARTICLE XII ASSIGNMENTS...........................................................................53 SECTION 12.1 Survival; Parties Bound: Successors and Assigns..............................53 ARTICLE XIII MISCELLANEOUS.........................................................................54 SECTION 13.1 Prior Loan Agreement.........................................................54 SECTION 13.2 Amendments, Etc..............................................................54 SECTION 13.3 Indemnification and Limitation of Claims.....................................54 SECTION 13.4 Notices......................................................................55 SECTION 13.5 No Waiver; Remedies..........................................................56 SECTION 13.6 Binding Effect; Assignment...................................................56 SECTION 13.7 Governing Law; Jurisdiction and Venue........................................56 SECTION 13.8 Severability.................................................................57 SECTION 13.9 Headings.....................................................................57 SECTION 13.10 Counterparts.................................................................57 SECTION 13.11 WAIVER OF TRIAL BY JURY......................................................57 SECTION 13.12 Transfer of Collateral to Special Purpose Entity.............................57
5 SECOND AMENDED AND RESTATED REVOLVING CREDIT LOAN AGREEMENT THIS SECOND AMENDED AND RESTATED REVOLVING CREDIT LOAN AGREEMENT (the "Agreement") dated as of December 30, 1998, by and between KOGER EQUITY, INC., a Florida corporation (the "Borrower"), and FIRST UNION NATIONAL BANK, a national association, as Agent for the Lenders (as defined herein). BACKGROUND This Second Amended and Restated Revolving Credit Loan Agreement amends and restates that certain Amended and Restated Revolving Credit Loan Agreement dated December 29, 1997 by and among First Union National Bank of Florida, a national association, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank, F.S.B., a federal savings bank, as lenders, and Borrower (the "Prior Loan Agreement"). The covenants, terms and provisions of this Agreement shall apply and shall govern the administration of the Loan and the making of Advances from and after the date of execution of this Agreement. IN CONSIDERATION of the mutual covenants herein contained, Borrower and the Lenders agree as follows: ARTICLE I DEFINITIONS AND ACCOUNTING TERMS SECTION 1.1 Certain Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined): "Adjusted EBITDA" means EBITDA minus Replacement Reserves. "Adjusted Net Operating Income" means the aggregate Net Operating Income for all Properties included within the Collateral multiplied by four (4) minus Replacement Reserves. "Advance" means (i) any Principal Advance, and (ii) any Letters of Credit issued by the Agent on behalf of the Lenders, in accordance with the terms and provisions of Section 2.1(b) hereof. "Affiliate" shall mean any Person controlling, controlled by or under common control with any other Person. For purposes of this definition, "control" (including "controlled by" and "under common control with") means the possession, directly or 6 indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or otherwise. "Agent" means First Union National Bank, in its capacity as administrative agent for the Lenders. "Agent's Counsel" means LeBoeuf, Lamb, Greene & MacRae, L.L.P. "AmSouth" means AmSouth Bank, a state banking corporation. "Appraisal" means an appraisal of a Property which is FIRREA compliant. "Assignment of Contracts" means each Assignment of Contracts, Licenses and Permits dated the Closing Date or on any Collateral Change Date and each Amendment to Assignment of Contracts, Licenses and Permits dated the Closing Date or on any Collateral Change Date given by Borrower to the Agent for the benefit of the Lenders assigning to the Lenders all of Borrower's interest in all contracts, licenses, permits, approvals, warranties, guaranties, service contracts, equipment leases, deposits and water and sewer rights relating to the Collateral located in each State. "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of FUNB) published or announced by FUNB from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. "Base Rate Advance" means any Advance bearing interest at the Base Rate pursuant to Article II. "Borrower" means, Koger Equity, Inc., a Florida corporation and any SPE (as defined herein) added as a Borrower pursuant to Section 13.12 from time to time. "Borrowing Base" means those Properties owned by Borrower which are encumbered by perfected first mortgage security interests and assignment of rents and leases and are included as Collateral for the Borrower's Obligations hereunder and under the Loan. "Borrowing Base Value" means the aggregate Borrowing Base Value for all Properties included within the Collateral, determined as follows: (i) for those Properties listed on Exhibit A under the subset of "Existing Properties Included Within Collateral", Borrowing Base Value shall mean the Adjusted Net Operating Income of all such existing Properties included within the Collateral determined as of the end of the last preceding quarter as reported to the Agent in accordance with the requirements hereof, multiplied by four and divided by the Capitalization Rate, (ii) for those Properties listed on Exhibit A under the subset of "New Properties Included Within Collateral", Borrowing Base Value shall mean the value set by the Appraisals for all such new Properties delivered to Agent 2 7 in connection with the execution of this Agreement and associated with all such new Properties. From and after the end of the first quarter following execution of this Agreement, Borrowing Base Value as to such new Properties shall mean Adjusted Net Operating Income determined as of the end of the last preceding quarter as reported to the Agent in accordance with the requirements hereof, multiplied by four and divided by the Capitalization Rate, and (iii) for all Properties added to Collateral in accordance with Article IV of this Agreement, Borrowing Base Value shall be calculated according to the formula set forth in subsection (ii) above with Adjusted Net Operating Income being used to determine Borrowing Base Value from and after the end of the first quarter following the addition of any such Properties or Collateral. "Business Day" means a day of the year on which banks are not required or authorized to close in Charlotte, North Carolina, and, if the applicable Business Day relates to any LIBOR Advances, on which dealings are carried on in the London interbank market and banks are open for business in London, England. "Capitalization Rate" means 9.75% per annum, as adjusted from time to time upon approval of all of the Lenders and the Borrower. "Cash Available for Distribution" means, with respect to a given period, Borrower's Funds From Operations for the most recent four (4) quarters, excluding all straight line rent leveling adjustments (reported in the consolidated financial statements of the Borrower for purposes of GAAP) minus Replacement Reserves and minus Scheduled Principal Payments on such Total Debt for the most recent four (4) quarters, whether or not paid by Borrower (excluding balloon payments). "Citizens" means Citizens Bank of Rhode Island, a Rhode Island financial institution. "Closing Date" means December 30, 1998. "Code" means the Internal Revenue Code, as amended, and Regulations promulgated thereunder. "Collateral" means the real property described on attached Exhibit A, and all easements and appurtenances thereto, and all improvements, furniture, fixtures and equipment, and related tangible and intangible personal property owned or leased by Borrower located thereon, and such other real property and easements and appurtenances thereto, and improvements, furniture, fixtures and equipment, and related tangible and intangible personal property owned or leased by Borrower located thereon, now or hereafter mortgaged, assigned, granted or conveyed by Borrower to the Agent or a trustee for the benefit of the Lenders as security for the payment and performance of the Obligations, pursuant to the terms, covenants and conditions of this Agreement and the other Loan Documents. 3 8 "Collateral Change Date" means the effective date of any (i) release of property from the Collateral, or (ii) addition of property to the Collateral as additional Collateral or in substitution of property released or to be released from the Collateral, as the case may be, pursuant to Article IV. "Commitment" means the commitment of the Lenders' funds pursuant to Article II hereof up to the Loan Amount. "Compass" means Compass Bank, an Alabama banking corporation. "Construction in Progress" means, the actual land acquisition costs and construction costs expended for Properties in which construction has begun but has not yet been completed. Such Property shall be reclassified from Construction in Progress upon the completion of construction, as represented by the issuance of a final certificate of occupancy, or its equivalent. "Default" has the meaning set forth in Section 8.1. "Default Rate" means a rate of interest equivalent to the then applicable interest rate for each outstanding Advance at the time of a particular Default, plus 4.00%, calculated on the basis of a 360 day year. "Development in Progress" means the aggregate, good faith estimated budgeted cost of construction (including land acquisition costs) for Properties on which construction has begun but has not yet been completed. Such Property shall be reclassified from Development in Progress upon the earlier of (1) achieving executed leases in place for 85% of such Property or (2) completion of construction, as represented by the issuance of a final certificate of occupancy, or its equivalent. "Due Diligence Package" shall mean the following information: Appraisal; Phase I environmental site assessment; market information; demographics; executed leases; copies of all contracts; permits and licenses related thereto; rent roll; operating statement; an A.L.T.A. Standard Loan Policy (or, with respect to any Texas property, a T.L.T.A. Standard Loan Policy) of title insurance insuring the Security Deed and deleting the gap and standard exceptions for encroachments and easements not shown by the public records, matters of survey, mechanics and materialmen's liens and parties in possession, together with copies of all documents listed as title exceptions therein; an ALTA/ACSM survey meeting the Minimum Standards and Supplementary Requirements for surveys on attached Exhibit D, and any other information reasonably requested by the Agent. "EBITDA" means, for any period of calculation and without duplication, net income (loss) of Borrower (including any SPE under Section 13.12) for such period (determined in accordance with GAAP and excluding equity net income or net losses of Subsidiaries and unconsolidated Affiliates) plus the sum of the following amounts (but only 4 9 to the extent included in determining net income (loss) for such period): (a) depreciation and amortization expense of Borrower for such period plus (b) Interest Expense of Borrower for such period plus (c) income tax expense of Borrower in respect of such period plus (d) extraordinary losses of Borrower, losses from the sale of assets of Borrower and losses resulting from forgiveness of debt by Borrower, all for such period minus (e) extraordinary gains of Borrower and gains from the sale of assets of Borrower for such period plus or minus (f) the Borrower's pro rata share of EBITDA of unconsolidated Affiliates (that are solely engaged in the investment of office real estate assets) determined in a manner consistent with this definition of EBITDA plus (g) deductions taken with respect to minority interest and (h) plus or minus an adjustment to omit the non-cash effect of straight-lining of Rents. For purposes of calculating "Adjusted EBITDA" for the financial covenants in Section 3.1(a)(iv) and Section 3.1(a)(v), EBITDA shall include the Borrower's pro rata share of EBITDA from Koger Realty Services, Inc., a Florida corporation. "Eligible Assignees" means commercial banks, savings banks, savings and loan associations or similar financial institutions, insurance companies and mutual funds having total assets of $5,000,000,000 or more, and which are generally engaged in lending of this type and in full compliance with all FDIC Control Act requirements or other regulatory requirements. "Eligible Land" means land owned by the Borrower and held for development that meets all zoning requirements for the respective jurisdiction and is situated within or adjacent to an existing office park or is located within an existing Market. "ERISA" means the Employment Retirement Income Security Act of 1974, as amended from time to time, and rules and regulations promulgated thereunder. "Event of Default" has the meaning set forth in Section 8.1. "Federal Funds Rate" means, for any day, the rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate quoted to the Agent on such day on such transactions as determined by the Agent. "Financial Covenants" has the meaning set forth in Section 3.1(a). "Fixed Charges" means for the particular period of calculation, the sum of Interest Expense (including accrued and capitalized Interest Expense), Scheduled Principal Payments, and preferred stock dividends. 5 10 "FUNB" means First Union National Bank, a national association "Funding Date" means each date on which the Lenders make an Advance, or, in the case of the continuation of an outstanding LIBOR Advance, the next Business Day following the last day of the Interest Period applicable to such outstanding LIBOR Advance. "Funds from Operations" shall have the same meaning as that contained in the most recently approved NAREIT definition as of July 9, 1998. "GAAP" means generally accepted accounting principles consistently applied. "GFB" means Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" means the requirements and mandates of all governmental laws, statutes, rules, regulations, ordinances or requirements, including, without limitation, regulations relating to protection of the environment, building and construction, highway access, disability access, asbestos, lead-based paint, zoning, land use and concurrency, and other regulations, applicable to the ownership, development, use or operation of the Collateral. "Gross Asset Value" means the sum of the following and without duplication: (a) the Borrower's (including any SPE under Section 13.12) Adjusted EBITDA, Less Net Operating Income for the real property assets acquired during the preceding quarter, for the most recent quarter multiplied by four and divided by the Capitalization Rate, (b) unrestricted cash and cash equivalents, (c) 100% of actual costs incurred in new Construction in Progress, restricted to a maximum of 10% of Gross Asset Value, (d) acquisitions of real property assets during the preceding quarter at their cost basis, (e) Eligible Land at its cost basis, and (f) the Borrower's (including any SPE under Section 13.12) GAAP investment value in Koger Realty Services, Inc. restricted to a maximum value of $1,500,000. "Guarantor" means collectively, Koger Real Estate Services, Inc. and Southeast Properties Holding Corporation. "Indemnification Agreement" means each Environmental Indemnification Agreement dated the Closing Date or any Collateral Change Date and each Amended and Restated Environmental Indemnification Agreement dated the Closing Date or any Collateral Change Date given by Borrower to and in favor of the Lenders with respect to the Collateral located in each State. "Insurer" means American and Foreign Insurance Company, or such other insurer selected by Borrower and approved by the Lenders and otherwise authorized to 6 11 transact business in each State and having an A.M. Best rating of "A-" or better and an asset size rating of "IX" or better. "Interest Period" means the 30-day, 60-day, 90-day or 180-day period, as elected by Borrower pursuant to Section 2.2(a), for any LIBOR Advance, commencing on the Funding Date of such LIBOR Advance, and ending on the last date of such period elected by Borrower; provided, that the duration of any Interest Period that begins prior to the Maturity Date but otherwise would end after the Maturity Date shall end on the Maturity Date, and further provided, that if the last day of such Interest Period would otherwise occur on a day that is not a Business Day, then such last day shall be extended to the next succeeding Business Day. "Interest Expense" means the total consolidated interest expense (including without limitation, capitalized interest expense and interest expense attributable to capitalized lease obligations) with respect to any indebtedness of Borrower and its unconsolidated Affiliates, and determined in accordance with GAAP. "Koger Net Square Feet" means the floor area unit measurement utilized by Borrower in the ordinary course of its business in measuring the floor area of an office building owned by Borrower for which Borrower ordinarily would receive rent, as follows: (A) measurement is made from centerline of corridor partitions and partitions separating tenants, (B) measurement is made from centerline of glass or 3" into wall where no glass is present, for exterior and permanent walls, and (C) no reduction in floor area is made for columns or other projections . "Late Charge" means an amount equivalent to the lesser of 5.00% of any scheduled payment amount or the maximum late charge permitted under applicable laws of any State if the laws of such State are determined to govern the Notes or this Loan Agreement. "Leases" means any tenant leases now or hereafter in existence in connection with the Collateral. "Lease Assignment" means each Assignment of Leases and Rents, and each Amended and Restated Assignment of Leases and Rents, whether incorporated into any Security Deed or set forth in a separate document, dated the Closing Date or any Collateral Change Date given by Borrower to and in favor of the Agent for the benefit of the Lenders, assigning all of Borrower's interest in the Leases and Rents relating to the Collateral located in each State. "Lenders" means collectively, FUNB, AmSouth, Citizens, Compass, GFB, and their respective successors and assigns. 7 12 "Lender's Commitment" means each Lender's proportionate share of the Loan Amount up to which it has committed to make Advances hereunder as set forth below:
LENDER'S COMMITMENT LENDER LENDER COMMITMENT FUNB $ 45,000,000.00 AmSouth $ 35,000,000.00 GFB $ 35,000,000.00 Citizens $ 20,000,000.00 Compass $ 15,000,000.00 - ------------------------------------------------------------------ --------------- - ------------------------------------------------------------------ --------------- - ------------------------------------------------------------------ --------------- TOTAL $150,000,000.00
"Lenders' Counsel" means legal counsel engaged by the Lenders from time to time in connection with the closing, administration, enforcement or collection of the Loan. "Lender's Percentage" means each Lender's proportionate percentage of the Loan Amount committed to by each Lender as set forth below:
LENDER'S PROPORTIONATE PERCENTAGE INTEREST OF LOAN AMOUNT LENDER LENDER PERCENTAGE First Union National Bank 30.0001% AmSouth 23.3333% GFB 23.3333% Citizens 13.3333% Compass 10.0000% - --------------------------------------------------------------------------- --------------- - --------------------------------------------------------------------------- --------------- - --------------------------------------------------------------------------- --------------- TOTAL 100%
"Letter of Credit" has the meaning set forth in Section 2.1(b). "Letter of Credit Documents" shall mean any and all documents evidencing the issuance, acceptance, and drawings under a Letter of Credit. "Letter of Credit Usage" means, at any time, the sum of (i) the aggregate maximum amount available to be drawn under the Letters of Credit then outstanding, assuming compliance with all requirements for drawing referred to therein and herein, and (ii) the aggregate amount of the Borrower's unpaid Obligations under this Agreement in respect of the Letters of Credit. 8 13 "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Borrower) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by FUNB from another recognized source or interbank quotation) in an amount approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. "LIBOR Advance" means any Advance bearing interest at a LIBOR Interest Rate pursuant to Article II. "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Borrower) plus the applicable margin based upon Koger Equity, Inc.'s leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) hereunder ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. "Loan" means the revolving credit facility in an aggregate amount up to the Loan Amount made available by the Lenders to Borrower in accordance with the terms, covenants and conditions of this Agreement. "Loan Amount" means $150,000,000.00 United States Dollars. "Loan Documents" means this Agreement, the Notes, the Security Deeds, the Lease Assignments, the Assignments of Contracts, the Indemnification Agreements, the Guaranties, and any other instruments, documents, affidavits or certificates given by Borrower to the Agent or any trustee for the benefit of the Lenders in support of, or evidencing or securing, the Loan. "Loan Term" means the term of the Loan, which shall commence on the Closing Date and shall expire on the Maturity Date. "Majority Lenders" means the Lenders with an aggregate amount of at least sixty-six and 67/100 percent (66.67%) of the amount of the Commitment then outstanding. 9 14 "Maturity Date" means December 30, 2001. "Maximum Swing Line Commitment" means a portion of the Loan Amount equal to a maximum of $2,500,000.00 United States Dollars. "Mortgage Debt Service" means the assumed principal and interest payments on the principal outstanding under the Loan at such quarter end when calculated on a 25 year amortization schedule and an interest rate equal to the then prevailing ten year United States Treasury Note rate plus 1.75%. For purposes of this definition, at no time shall the interest rate be less than 8.00% per annum. "Net Income" means, for any period, Borrower's net income determined in accordance with GAAP, adjusted to omit the straight line treatment of rent. "Net Operating Income" means, for any income producing operating Property included in the Borrowing Base and for any given fiscal quarter of the Borrower, the sum of the following (without duplication); (a) Rents and other revenues received in the ordinary course of operating such Property (including proceeds of rent loss insurance) minus (b) all expenses paid or accrued related to the ownership, operation or maintenance of such Property, including but not limited to taxes, assessments and the like, insurance, utilities, payroll costs, maintenance, repair and landscaping expenses and on-site marketing expenses, minus (c) property management fees, if any, paid or accrued in respect of such Property during such period and plus or minus (d) an adjustment to omit the straight-line treatment of Rents. "Notice of Borrowing" means any written notice given by Borrower to the Lenders from time to time requesting an Advance or continuing any outstanding Advance for an additional Interest Period, if applicable, specifying the requested Funding Date, the requested Interest Period, the requested amount of such Advance, and the interest rate elected by Borrower for such Advance. "Notes" means collectively (i) the Substitution Revolving Promissory Note dated as of the Closing Date made by Borrower payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of the Closing Date made by Borrower payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of the Closing Date made by Borrower payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of the Closing Date made by Borrower payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of the Closing Date made by Borrower payable to the order of Compass in the original principal amount of $15,000,000, together with any renewals, modifications or extensions of any of the foregoing. 10 15 "Obligations" means each and every payment and performance covenant, condition or agreement of Borrower to or in favor of the Lenders, or the Agent or any trustee for the benefit of the Lenders under the Loan Documents, including, without limitation, Borrower's obligation to repay the Advances, together with interest accrued thereon, in accordance with this Agreement and the other Loan Documents. "Person" means any individual, corporation, trust, unincorporated organization, governmental authority or any other form of entity. "Plan" means any plan defined in Section 4021(a) of ERISA in respect of which Borrower or any Subsidiary is an "employer" or a "substantial employer" as said terms are defined in Section 3(5) and 40041(a)(2), respectively, of ERISA. "Principal Advance" means any disbursement of principal out of the available undisbursed Loan Amount by the Lenders to Borrower. "Property" means any interest in any kind of property or asset, whether real, leasehold, personal or mixed, tangible or intangible. "REIT" means a Real Estate Investment Trust under ss.856-860 of the Code. "Rents" means all rents, profits, issues, income and royalties received from the Leases or otherwise in connection with the Collateral. "Rent Roll" means a document, certified by Borrower to be complete and correct, identifying all leases on any property that is or will become Collateral, the identity of the tenants thereunder, the location and floor area (both Koger Net Square Feet and leased area) of the leased premises thereunder, and the rent for the leased premises thereunder, and all other information pertaining to such leases as the Lenders shall require. "Replacement Reserves" means the greater of (1) an allowance for a normal level of recurring capital expenditures and lease commissions equal to (i) $1.25 per Koger Net Square Feet per year, multiplied by (ii) the total current Koger Net Square Footage of all Properties owned by the Borrower with a certificate of occupancy or its equivalent or (2) actual expenditures (excluding new building, major renovation or rehabilitation and building acquisitions) and lease commissions for the most recent four (4) quarters. For purposes of this definition, the calculation of replacement reserves with respect to cash flow coverage tests shall be based on the weighted average Koger Net Square Footage for the respective measurement period. Actual capital expenditures shall not include costs associated with first generation space. "Reportable Event" means any of the events set forth in Section 4043(b) of ERISA. 11 16 "Reserve Requirement" means the maximum percentage reserve requirement, if any, applicable to FUNB or any other Lender (rounded to the next higher 1/100 of 1% and expressed as a decimal) in effect for any day during the Interest Period under the Federal Reserve Board's Regulation D for Eurocurrency Liabilities as defined therein. "Scheduled Principal Payments" means all regularly scheduled, non-balloon payments of principal on Total Debt and capital leases, plus Interest Expense incurred with respect to subordinated Total Debt. "SEC" means the federal Securities and Exchange Commission. "Security Agreement" means each Security Agreement and each Amended and Restated Security Agreement, whether incorporated into any Security Deed or set forth in a separate document, or any amendment or modification thereto, dated the Closing Date or any Collateral Change Date given by Borrower to and in favor of the Agent for the benefit of the Lenders, granting to the Agent a first lien and security interest in that portion of the Collateral located in each State that constitutes tangible and intangible personal property. "Security Deed" means each Deed to Secure Debt, Amended and Restated Deed to Secure Debt, Deed of Trust, Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement, Mortgage, Assignment of Leases and Rents and Security Agreement, Amended and Restated Mortgage and Security Agreement, or any modification or amendment thereof, dated the Closing Date or any Collateral Change Date given by Borrower to and in favor of the Agent or a trustee for the benefit of the Lenders, granting to the Agent or such trustee a first lien and security interest or absolute title interest in that portion of the Collateral located in each State that constitutes real property, easements and appurtenances thereto, and improvements and fixtures, and sometimes incorporating a Security Agreement and/or Lease Assignment. "Shareholders' Equity" means, at any date, Borrower's stockholders' equity (determined on a book basis), less its Intangible Assets, as determined as of such date. For purposes of this definition, "Intangible Assets" means with respect to any such intangible assets, (i) the amount (to the extent reflected in determining such stockholders' equity) of all write-ups (other than write-ups resulting from foreign currency translations and write-ups of assets of a going concern business made within 12 months after the acquisition of such business) subsequent to December 31, 1996, in the book value of any asset (other than real property assets) owned by Borrower, and (ii) goodwill, patents, trademarks, service marks, trade names, anticipated future benefit of tax loss carry forwards, copyrights, organization or developmental expenses and other intangible assets. "State" means each state in which the Collateral is located. 12 17 "Stated Amount" means the stated amount of any Letter of Credit issued hereunder. "Subsidiary"means the corporations described on attached Exhibit G, which corporations are wholly-owned subsidiaries of Borrower, together with any other direct or indirect subsidiary of Borrower which falls within the meaning of "significant subsidiary" for federal securities law purposes (except for purposes of Section 6.1 wherein Subsidiary shall mean only those Subsidiaries listed on attached Exhibit G). "Summary Requirements" means the Summary Requirements for Additions to Collateral Pool Properties attached as Exhibit B. "Swing Line Advance" means an advance made by any Swing Line Bank pursuant to Section 2.3. "Swing Line Bank" means the Agent in its capacity as Swing Line Bank hereunder or any successor thereto as provided herein. "Swing Line Borrowing" means a borrowing consisting of a Swing Line Advance made by the Swing Line Bank. "Swing Line Note" means that certain Swing Line Promissory Note of even date herewith in the amount of $2,500,000.00 from Borrower to Swing Line Bank. "Title Commitment" has the meaning set forth in Section 4.3(b). 13 18 "Total Debt" means all obligations and liabilities of the Borrower on a fully consolidated basis, determined in accordance with GAAP, including capital leases, mortgage payables, notes payable, senior notes, convertible debentures, subordinated debentures, and secured or unsecured debt owed to banks or other financial institutions. Total Debt shall also include the Borrower's: (a) obligations under all letters of credit including Letters of Credit issued hereunder, (b) guarantees of indebtedness, (c) loans where the Borrower is liable for debt as a general partner, and (d) the Borrower's pro rata share of debt in unconsolidated Affiliates. "Total Debt Service" means, for any period, an amount equal to the sum of (i) Interest Expense (whether paid, accrued or capitalized) actually payable by Borrower on its Total Debt, and (ii) Scheduled Principal Payments on such Total Debt, whether or not paid by Borrower (excluding balloon payments). "Title Insurer" means Lawyers Title Insurance Company, and its authorized title agents in each State. "Undeveloped Land" means Eligible Land and all other separately divided undeveloped land held for either development or resale at its cost. "Unhedged Variable Rate Debt" means all Debt with a variable rate of interest that is not contractually swapped into a fixed rate of interest for a period in excess of one (1) year. "Unused Fee" means a non-refundable fee determined in accordance with the following Applicable Margins defined in the calculation of LIBOR Interest Rate hereunder: (i) if the Applicable Margin is 1.30% per annum, then the applicable Unused Fee is .15% per annum; (ii) if the Applicable Margin is 1.45% per annum, then the applicable Unused Fee is .20% per annum; or (iii) if the Applicable Margin is 1.60% per annum, then the applicable Unused Fee is .20% per annum; of the aggregate weighted average of each Lender's Commitment which is available but undisbursed during the immediately preceding calendar quarter, based on the difference between (a) such Lender's Commitment (or weighted average thereof during such calendar quarter if such Lender's Commitment changes during such calendar quarter), and (b) the weighted average of such Lender's Percentage of outstanding Advances during such calendar quarter. For the purposes of calculation of the Unused Fee, any Swing Line Advances will not reduce the Unused Fee otherwise owed any Lender other than the 14 19 Swing Line Bank, and each Lender's Commitment (except as reduced by outstanding Advances) will continue to be considered available, notwithstanding any limitations on Borrower's ability to borrow Advances hereunder. SECTION 1.2 Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP, consistently applied, except as otherwise stated herein. ARTICLE 2 AMOUNT AND TERMS OF ADVANCES SECTION 2.1 Advances. (a) Advances. Subject to the terms and conditions of this Agreement, each Lender severally agrees to make Advances prior to the Maturity Date to the Borrower not to exceed each Lender's Commitment. Each such request for an Advance by Borrower shall be deemed a request for an Advance from each Lender equal to such Lender's Percentage of the aggregate amount so requested, and such aggregate amount shall be in an amount at least equal to $1,000,000.00 and equal to an integral multiple of $500,000.00. Each principal repayment of the Loan shall be deemed a repayment of each Lender's aggregate Advances equal to such Lender's Percentage of the amount so repaid. The obligations of the Lenders hereunder are several and not joint, and the preceding three sentences will give rise to certain inappropriate results if special provisions are not made to accommodate the failure of a Lender to fund an Advance as and when required by this Agreement; therefore, notwithstanding anything herein to the contrary, (A) no Lender shall be required to make Advances at any one time outstanding in excess of such Lender's Percentage of the Commitment, and (B) if a Lender fails to make an Advance as and when required hereunder (a "Defaulting Lender") and Borrower subsequently makes a principal repayment of the Loan, such principal repayment shall be divided among the remaining Lenders which are not Defaulting Lenders ratably in accordance with their respective Lender's Percentages until each Lender has its Lender's Percentage of all of the outstanding Advances, and the balance of such principal repayment shall be divided among all of the Lenders in accordance with their respective Lender's Percentages. The Advances shall be evidenced by the Notes. (b) Letter of Credit. Subject to the terms and conditions of Section 2.1(a), each Lender severally agrees that it will participate with the Agent in the issuance of one or more letters of credit by the Agent on behalf of the Borrower during the period from and including the date of execution of this Agreement to, but excluding, the date which is sixty (60) days prior to the Maturity Date(each a "Letter of Credit"). Letter of Credit Usage shall not at any time exceed ten percent (10%) of the Loan Amount (the "L/C Commitment Amount"). All Letters of Credit shall be treated as Advances hereunder and together with any Principal Advances outstanding at any time shall not in the aggregate exceed the Loan Amount. A fee equivalent to Koger Equity, Inc.'s then current Applicable Margin (used in the 15 20 calculation of the applicable LIBOR Interest Rate hereunder) in arrears for all Letters of Credit will be due and payable at the end of each fiscal quarter of Koger Equity, Inc., to the Agent for the account of the Lenders. Additionally, Borrower shall also pay an issuance fee of .125% for each Letter of Credit, which fee shall be due and payable to the Agent upon issuance thereof. (c) Terms of Letters of Credit. At the time of issuance, the amount, form, terms and conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject to approval by the Agent and the Borrower. Notwithstanding the foregoing, in no event may the expiration date of any Letter of Credit extend beyond the date 30 days prior to the Maturity Date, and any Letter of Credit containing an automatic renewal provision shall also contain a provision pursuant to which, notwithstanding any other provisions thereof, if shall have a final expiration date no later than the date 30 days prior to the Maturity Date. (d) Requests for Issuance of Letter of Credit . The Borrower shall give the Agent written notice (or telephonic notice promptly confirmed in writing) no later than 9:00 a.m. two (2) Business Days prior to the requested date of issuance of a Letter of Credit, such notice to describe in reasonable detail the proposed terms of such Letter of Credit and shall set forth with respect to such Letter of Credit (i) the proposed initial Stated Amount, (ii) the beneficiary or beneficiaries, (iii) whether such Letter of Credit is a commercial or standby letter of credit and (iv) the proposed expiration date. The Borrower shall also execute and deliver such customary letter of credit application forms as requested from time to time by the Agent. Provided the Borrower has given the notice prescribed by this subsection and subject to the other terms and conditions of this Agreement, including, without limitation, the satisfaction of any applicable conditions precedent set forth in Article III or any terms and conditions restricting Advances, the Agent shall issue the requested Letter of Credit on the requested date of issuance. The Agent shall promptly provide notice to the Lenders of the issuance of any Letter of Credit issued hereunder, which notice shall set forth each Lender's Percentage of (1) such Letter of Credit and (2) all Letters of Credit then outstanding. Upon the written request of the Borrower, the Agent (x) shall make reasonable efforts to deliver to the Borrower a copy of any Letter of Credit proposed to be issued hereunder prior to the issuance thereof and (y) shall deliver to the Borrower a copy of each issued Letter of Credit within a reasonable time after the date of issuance thereof. To the extent any term of a Letter of Credit Document is inconsistent with a term of any Loan Document, the term of such Loan Document shall control. (e) Reimbursement Obligations. Upon receipt by the Agent of the proper documentation for the right to draw from the beneficiary of a Letter of Credit of any demand for payment under such Letter of Credit, the Agent shall promptly notify each of the Lenders of the amount of each Lender's Percentage for such payment. Each Lender shall then promptly pay the Agent its Lender's Percentage of the Stated Amount of such Letter of Credit in the same manner as each Lender Percentage of any Advance hereunder is funded. The Agent shall then pay the Stated Amount of such Letter of Credit to the beneficiary thereof, in the same manner as all Advances hereunder are funded to the 16 21 Borrower. All of the terms of this Agreement which pertain to the funding of Advances hereunder shall apply to all Letters of Credit, unless specifically herein stated to the contrary. (f) Effect of Letters of Credit on Commitments. Upon the issuance by the Agent of any Letter of Credit and until such Letter of Credit shall have expired or been terminated, each Lender Commitment shall be reduced for all purposes of this Agreement in an amount equal to such Lender's Percentage of the Stated Amount of such Letter of Credit. (g) Agent's Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement Obligation. In examining documents presented in connection with drawings under Letters of Credit and making payments under such Letters of Credit against such documents, the Agent shall use the same standard of care as it uses in connection with examining documents presented in connection with drawings under letters of credit in which it has not sold participations and making payments under such letters of credit. The Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, neither the Agent nor any of the Lenders shall be responsible for (i) the form, validity, sufficiency, accuracy, genuineness or legal effects of any document submitted by any party in connection with the application for and issuance of or any drawing honored under any Letter of Credit even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit, or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages by others, whether by mail, cable, telex, telecopy or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay by others in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit, or the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Agent or the Lenders. None of the above shall affect, impair or prevent the vesting of any of the Agent's rights or powers hereunder. Any action taken or omitted to be taken by the Agent under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not create against the Agent any liability to the Borrower or any Lender. In this connection, the obligation of the Borrower to reimburse the Agent for any drawing made under any Letter of Credit shall be absolute, unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all circumstances whatsoever, including without limitation, the following circumstances: (A) any lack of validity or enforceability of any Letter of Credit Document or any term or provisions therein; (B) any amendment or waiver of or any consent to departure from all or any of the Letter of Credit Documents; (C) the existence of any claim, set-off, defense or other right which the Borrower may have at any time 17 22 against the Agent, any Lender, any beneficiary of a Letter of Credit or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or in the Letter of Credit Documents or any unrelated transaction; (D) any breach of contract or dispute between the Borrower, the Agent, any Lender or any other Person; (E) any demand, statement or any other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein or made in connection therewith being untrue or inaccurate in any respect whatsoever; (F) any non-application or misapplication by the beneficiary of a Letter of Credit of the proceeds of any drawing under such Letter of Credit; (G) payment by the Agent under the Letter of Credit against presentation of a draft or certificate which does not strictly comply with the terms of the Letter of Credit; and (H) any other act, omission to act, delay or circumstance whatsoever that might, but for the provisions of this Section, constitute a legal or equitable defense to or discharge of the Borrower's reimbursement obligations. (h) Amendments, Etc. The issuance by the Agent of any amendment, supplement or other modification to any Letter of Credit shall be subject to the same conditions applicable under this Agreement to the issuance of new Letters of Credit (including, without limitation, that the request therefor be made through the Agent), and no such amendment, supplement or other modification shall be issued unless either (i) the respective Letter of Credit affected thereby would have complied with such conditions had it originally been issued hereunder in such amended, supplemented or modified form or (ii) the Majority Lenders shall have consented thereto; provided, however, no such amendment, supplement or modification shall result in the extension of the expiration date of the Letter of Credit without the Majority Lenders' prior written consent. (i) Lenders' Participation in Letters of Credit. Immediately upon the issuance by the Agent of any Letter of Credit each Lender shall be deemed to have irrevocably and unconditionally purchased and received from the Agent, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Percentage of the liability of the Agent with respect to such Letter of Credit and each Lender thereby shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and shall be unconditionally obligated to the Agent to pay and discharge when due, such Lender's Percentage of the Agent's liability under such Letter of Credit. (j) Information to Lenders. Upon the request of any Lender from time to time, the Agent shall deliver to such Lender information reasonably requested by such Lender with respect to any Letter of Credit then outstanding. Other than as set forth in this subsection or in the preceding subsection (d), the Agent shall have no duty to notify the Lenders regarding the issuance or other matters regarding Letters of Credit issued hereunder. The failure of the Agent to perform its requirements under this subsection or such subsection (d) shall not relieve any Lender from any of its obligations hereunder. 18 23 SECTION 2.2 Making Advances. (a) Each Advance shall be made (or continued for an additional Interest Period, if applicable), following a Notice of Borrowing received by Agent not later than 2:00 P.M. (Eastern Standard Time) on (i) in the case of a LIBOR Advance, the 4th Business Day prior to, or (ii) in the case of a Base Rate Advance, the 2nd Business Day prior to, the requested Funding Date (which requested Funding Date must be a Business Day); provided, however, that: (1) if Borrower fails to elect any particular interest rate, or if the requested Funding Date is less than 4 Business Days following such Notice of Borrowing, Borrower shall be deemed to have elected the Base Rate; and (2) Borrower shall have delivered to Agent the statements referred to in Section 3.1(c) prior to or concurrently with the applicable Notice of Borrowing described above. (b) Each Notice of Borrowing shall be irrevocable and binding on Borrower. Following any Notice of Borrowing, Borrower indemnifies and agrees to hold the Lenders harmless from and against any loss, cost or expense incurred by the Lenders as a result of any failure by Borrower to complete the borrowing specified in such Notice of Borrowing (whether or not due to a failure to fulfill on or before the date specified in such Notice of Borrowing the applicable conditions set forth in Article III), such losses, costs and expenses to include, without limitation, any loss (including loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by the Lenders to fund the Advance, when such Advance, as a result of such failure, is not made on the date requested for such Advance. (c) Subject to fulfillment of the applicable conditions set forth in this Article II and Article III below, each Lender will make available its Lender's Percentage of the Advance not later than 12:00 P.M. (Eastern Standard Time) in the amount and on the Funding Date requested for such Advance in same-day funds to the Agent at Agent's office at 301 South College Street, Charlotte, North Carolina, by wire transfer of such Advance for the account of Borrower. The Agent shall then make the Advance to the Borrower not later than 2:00 P.M. (Eastern Standard Time) in the amount and on the Funding Date requested for such Advance in same day funds by intra-bank transfer to Borrower's account maintained at FUNB, or by wire transfer to such other account as Borrower shall so direct by written notice to FUNB. (d) LIBOR Advances shall be subject to the following additional conditions: (1) if, at any time, (A) a Lender shall determine that, by reasons of circumstances affecting foreign exchange and interbank markets generally, LIBOR deposits in the applicable amounts are not being offered to the Lender, or (B) the introduction of or any change in or in the interpretation (including reversals) of any law or regulation makes it unlawful, or any central bank or governmental authority asserts that it is unlawful, for any Lender to obtain funds in the London interbank 19 24 market to fund or maintain a LIBOR Advance or otherwise to perform its obligations hereunder with respect to any such Advance, then such Lender's obligation to make or maintain any LIBOR Advance, and the right of Borrower to select any LIBOR Interest Rate, shall be suspended until the circumstances causing such suspension no longer exist, and the applicable LIBOR Interest Rate for any outstanding LIBOR Advance shall immediately be converted to the Base Rate for such LIBOR Advance for the remainder of the Interest Period; (2) LIBOR Advances may be repaid or prepaid only on the last Business Day of the Interest Period applicable to such Advance. Borrower may elect to maintain any outstanding LIBOR Advance for an additional Interest Period by delivering a Notice of Borrowing to Agent making such election within the time period required for such notices as set forth in this Section 2.2. If any LIBOR Advance is not repaid or prepaid on the last Business Day of the Interest Period, and Borrower has not otherwise timely delivered a Notice of Borrowing electing to continue such LIBOR Advance for an additional Interest Period elected by Borrower in such Notice of Borrowing, Borrower will be deemed to have elected to maintain such Advance outstanding as a Base Rate Advance. If, as a result of a payment made by Borrower due to acceleration of the maturity of the Notes pursuant to Section 8.2 or due to any other reason, the Lenders receive payment of any principal amount of any LIBOR Advance on a day other than the last day of the Interest Period for such LIBOR Advance, or Borrower fails to make any payment of principal outstanding under any LIBOR Advance when due under the Notes, Borrower shall pay to Agent on demand that amount, if any, required to compensate the Lenders, as reasonably calculated by each Lender, for additional losses, costs or expenses which the Lenders may incur as a result of such payment or nonpayment, including, without limitation, any loss (including loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by the Lenders to fund or maintain such LIBOR Advance. SECTION 2.3 Swing Line Advances. (a) Swing Line Loans. Subject to the terms and conditions hereof, the Swing Line Bank agrees to make Swing Line Advances to Borrower from the date hereof to the Business Day preceding the Maturity Date in an aggregate principal amount at any one time outstanding up to, but not exceeding, the amount of the Maximum Swing Line Commitment. If at any time the aggregate principal amount of the Swing Line Borrowings outstanding at such time exceeds the Maximum Swing Line Commitment in effect at such time, Borrower shall immediately pay the Swing Line Bank the amount of such excess. Subject to the terms and conditions of this Agreement, Borrower may borrow, repay and reborrow Swing Line Advances hereunder. Swing Line Borrowing shall not constitute usage of any Lender's Commitment, except from the Swing Line Bank. 20 25 (b) Procedure for Borrowing Swing Line Loans. The Borrower shall give the Agent and the Swing Line Bank notice pursuant to a Notice of Swing Line Borrowing in the form shown on attached Exhibit C (a "Notice of Swing Line Borrowing") delivered to the Swing Line Bank no later than 9:00 a.m. on the proposed date of such borrowing, provided that Borrower shall have given telephonic notice to the Swing Line Bank no later than 9:00 a.m. of the proposed date of borrowing. Any such telephonic notice shall include all information to be specified in a written Notice of Swing Line Borrowing. Not later than 11:00 a.m. on the date of the requested Swing Line Advance and subject to satisfaction of the applicable conditions set forth in Article III, for all Advances hereunder, the Swing Line Bank will make the proceeds of such Swing Line Advance available to Borrower, in immediately available funds, at the account specified by Borrower in the Notice of Swing Line Borrowing. (c) Interest. All Swing Line Borrowings shall bear interest at a per annum rate equal to (i) the Base Rate as in effect from time to time, or (ii) at such other rate or rates as Borrower and the Swing Line Bank may agree from time to time in writing. Interest payable on Swing Line Borrowings is solely for the account of the Swing Line Bank. All accrued and unpaid interest on Swing Line Borrowings shall be payable on the dates and in the manner provided in Section 2.5, with respect to interest on Base Rate Advances (except as the Swing Line Bank and Borrower may otherwise agree in writing in connection with any particular Swing Line Advance). (d) Swing Line Borrowing Amounts, Etc. Each Swing Line Borrowing shall be in the minimum amount of $500,000 and integral multiples of $100,000 in excess thereof or such other minimum amounts agreed to by the Swing Line Bank and Borrower. Any voluntary prepayment of a Swing Line Borrowing must be in integral multiples of $100,000 or the aggregate principal amount of all outstanding Swing Line Borrowings (or such other minimum amounts upon which the Swing Line Bank and Borrower may agree) and in connection with any such prepayment, Borrower must give the Swing Line Bank prior written notice thereof no later than 10:00 a.m. one Business Day prior to the date of such prepayment. The Swing Line Borrowing shall, in addition to this Agreement, be evidenced by the Swing Line Note. (e) Repayment and Participations of Swing Line Borrowing. The Borrower agrees to repay each Swing Line Advance within one Business Day of demand therefor by the Swing Line Bank and in any event, within five (5) Business Days after the date such Swing Line Advance was made. Notwithstanding the foregoing, Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid interest on, all Swing Line Borrowings on the Maturity Date (or such earlier date as the Swing Line Bank and Borrower may agree in writing). In lieu of demanding from Borrower repayment of any outstanding Swing Line Borrowings, the Swing Line Bank may, on behalf of Borrower (which hereby irrevocably directs the Swing Line Bank to act on its behalf), request a borrowing of a Base Rate Advance from the Lenders in an amount equal to the principal balance of such Swing Line Borrowing. Each Lender will make available to the Agent for the account of the Swing Line Bank, in immediately available funds not later than 9:00 a.m. 21 26 on the proposed date of such borrowing, the proceeds of the Base Rate Advance to be made by such Lender, in the amount of each Lender's Percentage of such Base Rate Advance. The Agent shall apply such proceeds to repay such Swing Line Borrowing. If the Lenders are prohibited from making Advances required to be made under this subsection for any reason whatsoever, including without limitation, the occurrence of any of the Defaults or Events of Default described in Section 8.1, each Lender shall purchase from the Swing Line Bank, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Percentage of such Swing Line Borrowing, by directly purchasing a participation in such Swing Line Borrowing in such amount and paying the proceeds thereof to the Swing Line Bank in immediately available funds. A Lender's obligation to purchase such a participation in a Swing Line Borrowing shall be absolute and unconditional and shall not be affected by any circumstance whatsoever, including without limitation, (i) any claim of setoff, counterclaim, recoupment, defense or other right which such lender or any other Person may have or claim against the Agent, the Swing Line Bank or any other Person whatsoever, (ii) the occurrence or continuation of a Default or Event of Default (including without limitation, any of the Defaults or Events of Default described in Section 8.1 or the termination of any Lender's Commitment, (iii) any breach of any Loan Document by the Agent, any Lender or Borrower or (iv) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If any Lender shall fail to make available to the Swing Line Bank the purchase price of any such participation, the Swing Line Bank shall be entitled to recover such amount on demand from such Lender, together with accrued interest thereon for each day from the date of demand thereof, at the Base Rate. If such Lender does not pay such amount forthwith upon the Swing Line Bank's demand therefor, and until such time as such Lender makes the required payment, the Swing Line Bank shall be deemed to continue to have outstanding Swing Line Advances in the amount of such unpaid participation obligation for all purposes of the Loan Documents (other than those provisions requiring the other Lenders to purchase a participation therein). Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Advances, and any other amounts due to it hereunder, to the Swing Line Bank to fund Swing Line Borrowings in the amount of the participation in Swing Line Borrowings that such Lender failed to purchase pursuant to this Section until such amount has been purchased (as a result of such assignment or otherwise). All payments of principal, interest, fees and other amounts in respect of the Swing Line Borrowings shall be for the account of the Swing Line Bank only (except to the extent any Lender shall have acquired a participating interest in any such Swing Line Borrowings pursuant to this subsection). SECTION 2.4 Fees. (a) After the Closing Date, in consideration for the Lenders' reservation of funds for availability for borrowing under the Loan, Borrower shall pay the Unused Fee to the Agent for the Lenders in arrears at the end of each calendar quarter. (b) In consideration of the Lenders' issuance of Letters of Credit hereunder, Borrower shall pay to Agent for the account of the Lenders, in arrears, at the end of each 22 27 fiscal quarter of Koger Equity, Inc., a fee equivalent to Koger Equity, Inc.'s then current Applicable Margin multiplied by the aggregate Stated Amount of all outstanding Letters of Credit. (c) Borrower shall pay Agent, for the account of Agent only, an issuance fee of .125% for each Letter of Credit, which fee shall be due and payable to the Agent upon issuance thereof. SECTION 2.5 Repayment of Advances; Prepayments. (a) Interest only, computed daily on the outstanding principal balance of the Loan, shall be due monthly on the 10th day of each calendar month for the preceding calendar month, and shall be paid to Agent. On the Maturity Date, the entire outstanding principal balance of the Loan, together with all accrued and unpaid interest thereon, and late fees and other charges, if any, payable by Borrower under the Loan Documents, shall be due and payable in full, and shall be paid to Agent. Any payment of interest which is not made within 10 days following its due date or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Agreement, shall be subject to a Late Charge, which shall be due and payable contemporaneously with such payment of interest. (b) During the Loan Term, the Loan Amount may be borrowed, repaid and reborrowed on a revolving basis, provided, that prior to the Maturity Date, the outstanding principal balance of the Loan shall never be less than $1,000.00 nor greater than the maximum principal amount permitted to be borrowed under the Loan pursuant to the Financial Covenants. Each prepayment of any of the outstanding principal amount shall be in a minimum amount of $1,000,000 and integral multiples of $500,000 thereafter. Repayments of the outstanding principal amount of any Advance may be made on any Business Day, provided, that repayments received after 11:00 A.M. (Eastern Standard Time) shall not be credited to Borrower's account until the next Business Day, and further provided, unless Borrower prior to or contemporaneously with such repayment designates in writing to Agent the Advance that should be credited with such repayment, such repayment shall be applied to repayment of Advances on a "first-borrowed first-repaid" basis. Repayment of any LIBOR Advance on any day other than the maturity of the Interest Period applicable to such LIBOR Advance may be subject to a charge pursuant to Section 2.2(d), payable by Borrower to Agent at the time of such repayment. Repayment of any Base Rate Advance may be repaid without penalty or premium. (c) If the Agent receives a payment of interest or a prepayment of principal for the account of the other Lenders prior to 11:00 A.M. (Eastern Standard Time) on any Business Day, a pro rata portion of such payment must be delivered to each other Lender based upon each Lender's Percentage in the Advances made to date. If a payment of principal or interest is not received by Agent until after 11:00 A.M. (Eastern Standard Time) on any Business Day, the payment of each Lender's Percentage share of such payment shall be delivered to the Lenders and credited to the Borrower on the next Business Day. 23 28 If a payment of principal or interest is received by the Agent between 11:00 A.M. (Eastern Standard Time) and 2:00 P.M. (Eastern Standard Time) on any Business Day, in the event any Lender's Percentage share of such payment is not paid to such Lender until the next Business Day, then Agent shall pay such Lender interest at the Federal Funds Rate on such Lender's Percentage of the payment for such day. (d) Except to the extent otherwise provided herein: (a) each borrowing from the Lenders under Section 2.1 hereof shall be made ratably from the Lenders on the basis of their respective Lender Percentages; and (b) each payment by the Borrower of principal or interest on the Loan or on any other sums advanced by the Lenders pursuant to the Loan Documents, and of any other amount owed to the Lenders shall be made to the Agent for the account of the Lenders based upon each Lender's Percentage in the respective unpaid principal amounts of the Loans held by the Lenders. (e) Unless the Agent shall have been notified by a Lender or the Borrower (the "Payor") prior to the date on which such Lender is to make payment to the Agent of the proceeds of an Advance to be made by it hereunder or the Borrower is to make a payment to the Agent for the account of one or more of the Lenders, as the case may be (such payment being herein called the "Required Payment"), which notice shall be effective upon receipt, that the Payor does not intend to make the Required Payment to the Agent, the Agent may assume that the Required Payment has been made and may, in reliance upon such assumption (but shall not be required to), make the amount thereof available to the intended recipient on such date and, if the Payor has not in fact made the Required Payment to the Agent, the recipient of such payment shall, on demand, pay to the Agent the amount made available by the Agent together with interest thereon in respect of the period commencing on the date such amount was so made available by the Agent until the date the Agent recovers such amount at a rate per annum equal to (a) the Default Rate for such period if the recipient returning a Required Payment is the Borrower, or (b) the Federal Funds Rate for such period if the recipient returning a Required Payment is the Agent or a Lender. (f) The Borrower agrees that, in addition to (and without limitation of) any right of set-off, bankers' lien or counterclaim a Lender may otherwise have, each Lender shall be entitled, at its option (and without regard to the adequacy of other collateral) to offset balances held by it for the account of the Borrower at any of its offices, against any principal of or interest on any of such Lender's Advances to the Borrower hereunder, or other Obligations of the Borrower hereunder, which is not paid (regardless of whether such balances are then due to the Borrower), in which case it shall promptly notify the Borrower and the Agent thereof, provided that such Lender's failure to give such notice shall not affect the validity thereof. If a Lender shall obtain payment of any principal of or interest on any Advance made by it under this Agreement then due to such Lender hereunder, through the exercise of any right of set-off, banker's lien, counterclaim or similar right, or otherwise it shall promptly purchase from the other Lenders portions of the Advances made or other Obligations held by the other Lenders in such amounts, and make such other adjustments from time to time as shall be equitable to the end that all the Lenders 24 29 shall share the benefit of such payment (net of any expenses which may be incurred by such Lender in obtaining or preserving such benefit) in accordance with each Lender's Percentage. To such end all the Lenders shall make appropriate adjustments among themselves (by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise be restored. Nothing contained herein shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such right with respect to any other indebtedness or Obligation of the Borrower. SECTION 2.6 Interest Rate; Default Rate. (a) The amount of each Advance shall accrue interest, at Borrower's election, at a LIBOR Interest Rate or the Base Rate. Borrower shall be entitled to elect the applicable LIBOR Interest Rate (which interest rate will vary based on Interest Period selection and the Borrower's Leverage at the time of any Advance) or the Base Rate for any Advance under and subject to the conditions set forth in Section 2.2, provided that not more than 5 separate LIBOR Interest Rates (which interest rates will vary based on Interest Period selection and the Borrower's Leverage at the time of any Advance) and the Base Rate, shall be applicable to Advances at any one time that such Advances are outstanding. (b) Following an Event of Default, the amount of each Advance shall, at the Lenders' option, without notice to Borrower accrue interest from the date of Default at the Default Rate. SECTION 2.7 Payments and Computations. Borrower shall make each payment under any Loan Document not later than 11:00 A.M. (Eastern Standard Time) on the day when due in lawful money of the United States of America to Agent, at 301 South College Street, Charlotte, North Carolina 28288 in immediately available funds. All computations of interest under the Notes and hereunder, other than the computation of interest at the Base Rate, shall be made by the Lenders on the basis of a year of 360 days, and all computations of interest at the Base Rate shall be made by the Lenders on the basis of a year of 365 or 366 days, as the case may be, for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable. Whenever any payment to be made hereunder or under the Notes shall be stated to be due on a day other than a Business Day, such payment may be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest. SECTION 2.8 Evidence of Indebtedness. The indebtedness of Borrower resulting from all Advances made from time to time shall be evidenced by the Notes. SECTION 2.9 Prior LIBOR Advances. Effective as of the Closing Date the outstanding principal balance of all prior LIBOR Advances made under and pursuant to the terms and conditions of the Prior Loan Agreement shall convert to the LIBOR Interest Rate applicable as of the Closing Date (which interest rate will be based on Borrower's Interest 25 30 Period selection and the Borrower's Leverage on the Closing Date). Borrower shall not be responsible for any fees, charges, or other costs set forth in Section 2.2 associated with such LIBOR Interest Rate change. SECTION 2.10 Advances Under Prior Loan Agreement. Advances made by any of the Lenders under the Prior Loan Agreement (the "Prior Advances") shall be subject to the covenants, terms and conditions of this Agreement from and after the Closing Date. Each of the Lenders, by execution of this Agreement, commits to extend its Lender's Percentage of the Prior Advances as of 5:00 p.m. on the Closing Date. Each of the Lenders shall pay the Agent its Lender's Percentage of the outstanding principal balance of all Prior Advances as of the Closing Date. The Agent shall then pay each Lender under the Prior Loan Agreement such funds as are allocable to each such Lender under the Prior Loan Agreement as its proportionate share of such prior Advances. Thereafter, all Advances, whether made under the Prior Loan Agreement or under this Agreement, shall be administered in the same manner, according to each Lender's Percentage. SECTION 2.11 Increase to Loan Amount. Provided that no Event of Default has occurred, the Borrower may upon sixty (60) Business Days prior written notice to the Agent, request the Loan Amount be increased to $200,000,000. Together with any such request the Borrower shall include (i) a certificate of an officer of the Borrower certifying that there has been no material adverse change in the financial position of the Borrower or in its compliance with the Financial Covenants since the date of its most recent Borrowing Compliance Certificate and further certifying that no Event of Default or event which, with the passage of time or the giving of notice or both, would constitute an Event of Default has occurred, (ii) the increased Loan Amount shall not exceed sixty percent (60%) of the Borrowing Base Value, and (iii) such other information, documentation or opinions as the Agent may reasonably request. The Agent shall promptly forward Borrower's request to each of the Lenders prior to seeking the participation of any other Lender. No Lender shall be required to increase its Lender Commitment unless expressly agreed to in writing, but the Agent, any Lender hereunder, or any other lender may increase its Lender Commitment by an amount necessary to comply with the Borrower's request. If the Agent is willing to increase its own Lender Commitment or is able to secure increased Lender Commitments in an aggregate amount of $200,000,000, then Agent shall notify the Borrower that its request to increase the Loan Amount has been obtained. Thereafter, Borrower may obtain Advances up to $200,000,000 in accordance with the terms and provisions of this Agreement. If the Agent is unwilling to increase its Lender Commitment or is unable to secure increased Lender Commitments in an aggregate amount of $200,000,000 then Agent shall notify the Borrower that its request to increase the Loan Amount has been denied. If, by the end of such sixty (60) Business Day period, the Company shall not have received a written approval or rejection of such request, such request shall be deemed to have been denied. 26 31 ARTICLE III CONDITIONS OF LENDING AND FINANCIAL COVENANTS SECTION 3.1 Conditions Precedent to Advances and Financial Covenants. The obligation of the Lenders to make each Advance shall be subject to the conditions precedent that on the date of any Notice of Borrowing requesting an Advance and on the Funding Date: (a) Borrower shall, at all times, be in compliance with the following financial covenants (the "Financial Covenants"): (i) Koger Equity, Inc.'s status as a REIT shall be continuing, and Koger Equity, Inc. shall continue to be listed as a publicly traded company on a nationally recognized stock exchange. (ii) The outstanding principal balance of the Loan shall not exceed sixty percent (60.00%) (the "Advance Rate") of the Borrowing Base Value at any time. The Lenders shall not make any Advance unless Borrower shall have pledged and/or mortgaged Collateral with a sufficient Borrowing Base Value to ensure compliance with the Advance Rate. The Borrowing Base Value, and the related limitation on the outstanding principal balance of the Loan, shall be recalculated by the Agent not less frequently than quarterly using the actual Adjusted Net Operating Income (calculated on the most recent quarter ended) generated from the Collateral and the Capitalization Rate to determine borrowing availability. Changes to the Capitalization Rate and the Advance Rate require the unanimous consent of all of the Lenders and the Borrower. (iii) As of the end of the most recent fiscal quarter, Adjusted Net Operating Income for such quarter derived from the Collateral (after deducting therefrom appropriate management costs relating to the Collateral), shall be at least 1.50 times Mortgage Debt Service for such quarter attributable to the Loan (the "Cash Flow Requirement"). Provided no Default or Event of Default is then existing under the Loan, and Adjusted Net Operating Income shall not have fallen below an amount which is 1.35 times the Mortgage Debt Service, as calculated according to the preceding sentence, Borrower shall have thirty (30) days to correct an insufficient Cash Flow Requirement by mortgaging or pledging additional Collateral, acceptable to the Majority Lenders, to the Borrowing Base or reducing the principal balance of the Loan then outstanding. (iv) At all times and calculated as of the last day of each fiscal quarter, the ratio of (x) Adjusted EBITDA to (y) Interest Expense (whether accrued, paid or capitalized) for the previous four consecutive quarters including the quarter then ended, will not be less than 2.00 to 1.00. (v) At all times and calculated as of the last day of each fiscal quarter, the ratio of (x) Adjusted EBITDA to (y) Fixed Charges for the previous four consecutive quarters including the quarter then ended, will not be less than 1.70 to 1.00. 27 32 (vi) Total Debt shall not, at any time, exceed 55% of Gross Asset Value. (vii) Shareholder's Equity shall at all times be equal to at least $450,000,000 plus seventy-five percent (75%) of all net proceeds from future equity offerings plus one hundred percent (100%) of the value generated by the issuance of operating partnership units. (viii) Development in Progress shall not at any time exceed fifteen percent (15%) of Gross Asset Value. (ix) As of the end of the most recent fiscal quarter, the percentage of distributions or dividends paid to shareholders paid from Funds from Operations, calculated on a rolling four quarter basis, shall not exceed ninety percent (90%) unless required to maintain Koger Equity, Inc.'s REIT status. (x) As of the end of each fiscal quarter, distributions or dividends paid to shareholders, calculated on a rolling four (4) quarter basis, shall not exceed one hundred percent (100%) of Cash Available for Distribution. Notwithstanding the foregoing, Koger Equity, Inc. may distribute or dividend that amount which shall be required to maintain Koger Equity, Inc.'s REIT status. (xi) At all times, the Borrower's total investments in items (a) through (d) below shall be restricted as follows (the "Permitted Investments"): (a) Investments in partnerships, joint ventures, and other non-corporate entities (except for any Special Purpose Entities formed in accordance with the terms of Section 13.12) accounted for on an equity basis shall not exceed ten percent (10%) of Gross Asset Value; (b) Investments in non-office operating Properties, and other investments permitted under the Borrower's organizational documents shall not exceed ten percent (10%) of Gross Asset Value; (c) Investments in Undeveloped Land shall not exceed seven and one-half percent (7.5%) of Gross Asset Value; and (d) Investments in mortgages shall not exceed five percent (5%) of Gross Asset Value. The Borrower's total Permitted Investments in items (a) through (d) above shall not exceed, in the aggregate, twenty percent (20%) of Gross Asset Value. At all times, at least eighty-five percent (85%) of the Borrower's Gross Asset Value must consist of assets owned by the Borrower or an SPE or of investments in a Guarantor of the Loan. 28 33 (xii) Borrower's Unhedged Variable Rate Debt shall not exceed twenty percent (20%) of Gross Asset Value. (b) As of the requested Funding Date, Borrower shall have satisfied, and shall be in continuing compliance with, all of the terms, covenants and conditions required to be satisfied as a condition precedent to any Advance, and shall be in continuing compliance with all of the terms, covenants and conditions of the Loan Documents, and no Default or Event of Default shall then exist or be continuing. (c) The following statements shall be true and, concurrently with delivery of the Notice of Borrowing for such Advance, the Agent shall have received a certificate, substantially in the form attached as Exhibit J (the "Borrowing Compliance Certificate"), signed by a duly authorized officer of Borrower, dated the Funding Date, stating that: (i) The representations and warranties contained in Section 6.1 are correct on and as of the Funding Date, before and after giving effect to such Advance and to the application of proceeds therefrom, as though made on and as of such date, (ii) No event or condition has occurred or is continuing, or would result from such Advance or from the application of proceeds therefrom, which constitutes a Default or Event of Default, and (iii) Borrower is in compliance with each of the Financial Covenants before and after giving effect to such Advance and to the application of proceeds therefrom. SECTION 3.2 Conditions Precedent to Certain Advances. The obligation of the Lenders to make any Advance that, but for the addition of Collateral pursuant to Section 4.3, would cause the principal balance of the Loan to exceed the maximum borrowing limits determined in accordance with the Financial Covenants, shall be subject to the further conditions precedent that on the date of the Notice of Borrowing requesting such Advance and on the Funding Date, Borrower shall have executed and delivered the Loan Documents, or modifications thereof, relating to the addition of such Collateral, as the Lenders reasonably may request to carry out the provisions and intent of this Agreement, all in form and content acceptable to the Lenders in their sole discretion, and shall have satisfied the conditions and requirements set forth in Article IV. SECTION 3.3 Eligible Borrowing Base. Any Property owned by Borrower must meet the following eligibility parameters to be included in the Borrowing Base and accepted as Collateral: (a) No liens (other than the lien of a Security Deed or lien arising pursuant to any other Loan Document) may encumber or be placed on any part of the real property assets; 29 34 (b) The Borrower shall have fee simple title to all of the Property; (c) The Property must be utilized by Borrower as an office Property, except for the Property commonly known as "The Shops at the Colonnade" located in Birmingham, Alabama, which Property is currently used for retail purposes. (d) To be included as Collateral, each office property not included within a Koger Business Park and all of those Properties which together comprise an entire Business Park must be at least eighty percent (80%) occupied by tenants under leases complying with the requirements of this Agreement and paying current market Rents. For purposes of this test, "Business Park" means any one or more contiguous buildings, together with all associated parking, improvements and other appurtenances thereto which together function as a cohesive office park sharing common areas, parking, appearance, and design. (e) The environmental condition of the Property must be acceptable to each of the Lenders, and the Lenders shall have reviewed and approved the Phase I environmental site assessment for the Property, any required asbestos study, and a properly executed Indemnification Agreement as to the Property; (f) No one Market, other than the Atlanta Market, may account for more than thirty percent (30%) of the Borrowing Base Value. For the purposes of this covenant, "Market" shall be defined as Standard Metropolitan Statistical Area commonly known as "SMSA". No new Properties may be acquired, substituted or otherwise added in the Atlanta Market which would cause the Atlanta Market to exceed thirty percent (30%) of the Borrowing Base Value. (g) Borrower shall have submitted to each of the Lenders a complete Due Diligence Package containing all of the documents and materials required hereunder and also including any additional due diligence materials reasonably requested by Lender for each Borrowing Base Property to be included in the Collateral; and (h) The Majority Lenders shall have approved the Due Diligence Package for each Borrowing Base Property to be included in the Collateral. ARTICLE IV ADDITION, SUBSTITUTION AND RELEASE OF COLLATERAL SECTION 4.1 General Right to Add, Substitute or Release Collateral. Subject to the written approval of the Majority Lenders, Borrower may elect, at any time during the Loan Term, to cause the addition, substitution or release of Collateral, subject, however, to Borrower's continuing compliance with the Financial Covenants and with the requirements of this Article IV; provided, that the Lenders reserve the right to exclude from the Collateral any particular office building or property that Borrower requests for addition 30 35 to Collateral based on sub-standard occupancy, location, operating history, age, condition, or environmental concerns, in the Lenders' sole discretion, and further provided, that Borrower shall not have the right to cause the addition, substitution or release of Collateral if a Default or Event of Default exists and is continuing. In support of any request for release, substitution or addition of Collateral, Borrower shall submit to Agent: (i) a certification, in form and content acceptable to the Lenders in their sole discretion, prepared by management and certified by the chief financial officer or chief accounting officer of Borrower, certifying to the Lenders that, after such proposed release, substitution or addition of office buildings, Borrower will be in compliance with the Financial Covenants; (ii) the information or documentation required to be executed and/or delivered to the Lenders as set forth in this Agreement, including, without limitation, modifications or partial releases of the Loan Documents (or delivery of additional Loan Documents in form and content satisfactory to Lenders and consistent with the requirements of this Agreement) as necessary or appropriate to properly reflect the release, substitution or addition of Collateral in the discretion of the Lenders and the Lenders' Counsel, compliance with all of the Borrowing Base eligibility requirements set forth in Section 3.3 hereof, and the documentation as set forth in the Summary Requirements as to the office buildings proposed to be substituted for or added to the Collateral, as applicable; and (iii) evidence satisfactory to the Lenders that such additional Collateral, or the remaining Collateral after substitution or release of other Collateral, has adequate and legal rights of ingress and egress, drainage and utilities, and, if necessary or appropriate, Borrower shall deliver to and in favor of the Lenders, their respective successors and assigns, such perpetual non-exclusive easements as the Lenders may reasonably request to create such adequate and legal rights of ingress and egress, drainage or utilities. With respect to easements for ingress and egress, drainage or utilities that reasonably may be required over, under or across the released Collateral as a result of the release of such Collateral, the Lenders may establish such easement or easements at the time of such release pursuant to a Quit Claim Deed with Reservations and Grants of Easements in substantially the form attached as Exhibit I (the "Release Deed"), with modifications as appropriate for the particular circumstances of such release, and the nature of the easement or easements required, to comply with the laws of any State. Similarly, if as a result of any such release, the released Collateral reasonably may require easements for ingress and egress, drainage or utilities over, under or across any portion of the remaining Collateral, then at Borrower's request, the Lenders shall, subject to the remaining provisions of this Article IV below, cause such release to be made using the form of Release Deed, with modifications as appropriate for the particular circumstances of such release and the nature of the easement or easements required. 31 36 The Lenders' decision whether to accept Borrower's request for substitution, addition or release of Collateral shall be based on Borrower's satisfaction of the foregoing requirements, delivery and approval of the Due Diligence Package, and on the documentation and information delivered to the Lenders in compliance with Section 3.3 and any other provisions of this Agreement and the Summary Requirements, and on a determination by the Lenders, in their sole and absolute discretion, that there has been no material adverse change in the financial condition of Borrower, and that all other aspects of the Property to be added or substituted, as applicable, including without limitation, the general condition of such Property and vacancy rates of the local commercial leasing market, are substantially similar to the existing Collateral, or, if applicable, to the Collateral to be released for substitution by new Property, subject to the Lenders' discretion. SECTION 4.2 Requirements for Release of Collateral. In addition to the general conditions and requirements for release of Collateral as set forth in Section 4.1, the following conditions and requirements shall be satisfied prior to the release of any Collateral: (a) If the Property proposed for release from the Collateral is not the exclusive subject matter of a boundary survey on file with the Lenders showing the Collateral, then, not later than 15 days prior to the Collateral Change Date for such release, Borrower shall deliver to Agent a current boundary survey of the Property proposed for release from the Collateral, and a current boundary survey of the remaining Collateral if the existing boundary survey of the Collateral is affected by the release of such Property from the Collateral. Each such survey shall meet or exceed the Minimum Standards and Supplementary Requirements set forth on attached Exhibit D. Each survey shall be subject to review and approval by the Lenders, the Lenders' Counsel, and Title Insurer; (b) No release of any Collateral will be permitted if the release of such Collateral would violate the Market restrictions set forth in Section 3.3(f); and (c) The Borrowing Base Value of the remaining Collateral shall not be less than $100,000,000.00 after the release of any Collateral hereunder. SECTION 4.3 Requirements for Addition or Substitution of Collateral. In addition to the general conditions and requirements for addition or substitution of Collateral as set forth in Section 4.1, the following conditions and requirements shall be satisfied prior to the addition or substitution of any Collateral: (a) Prior to any Collateral Change Date, the Lenders shall have ordered at Borrower's expense and received a current Appraisal of the Property to be added to the Collateral as additional Collateral or in substitution of existing Collateral. Following the Lenders' receipt of such Appraisal satisfactory to the Lenders, the Lenders will provide a copy of such Appraisal to Borrower. Such Appraisals shall be utilized by the Lenders for informational purposes, and shall be subject to review and approval by the Lenders. 32 37 (b) Not later than 30 days prior to any Collateral Change Date, Borrower shall deliver to the Agent and the Agent's Counsel a commitment or binder for an endorsement to the existing title insurance policy (if the Property to be added to the Collateral is located in the same State as the existing Collateral) or for a new title insurance policy (if the Property to be added to the Collateral is not located in the same State as the existing Collateral or is located in the State of Texas) issued by Title Insurer, committing to insure the Lenders' first security or title interest in the Property to be added to the Collateral as additional Collateral or in substitution of existing Collateral (as legally described to include any easements benefitting such real property), meeting or exceeding the Minimum Title Standards set forth on attached Exhibit E (the "Title Commitment"). The Title Commitment shall contain only those matters expressly approved by the Lenders, and shall include complete copies of all listed title exceptions. All title exceptions are subject to the Lenders' review and approval, and any liens of prior mortgagees or creditors shall be satisfied or released on or before the Collateral Change Date. On the Collateral Change Date, Borrower shall cause Title Insurer to deliver its marked original Title Commitment indicating the proper satisfaction of all conditions to issuance of a title insurance policy or endorsement thereof, as the case may be, insuring the Lenders, its successors and assigns as their interests may appear, based on such Title Commitment subject only to those matters and exceptions to coverage as set forth in the Title Commitment as previously may have been approved by the Lenders. (c) Not later than 30 days prior to any Collateral Change Date, Borrower shall deliver to the Agent and the Agent's Counsel six (6) copies (or a greater number in the event additional Lenders are added to the Loan) of a current boundary survey (or recertified boundary survey, provided that the same is, in the discretion of Title Insurer, sufficient to permit Title Insurer to remove the standard survey exceptions) for the Property to be added to the Collateral, meeting or exceeding the Minimum Standards and Supplementary Requirements set forth on attached Exhibit D. Each survey shall be subject to review and approval by the Lenders, the Lenders' Counsel, and Title Insurer. Surveys for buildings within single office parks shall be accompanied by a site map showing the relative location of each building within such office park. (d) Not later than 30 days prior to any Collateral Change Date, Borrower shall deliver to the Agent a current UCC-11 search for Florida and each State or local jurisdiction (if applicable) in which the Property to be added to the Collateral is located, evidencing to the Lenders' satisfaction that such additional Property is free and clear of any liens or perfected security interests prior to the Lenders' security interest therein. On or before the Collateral Change Date, Borrower shall deliver to the Agent UCC-1 Financing Statements for filing in Florida and each State or local jurisdiction (if applicable) in which the Property to be added to the Collateral is located, perfecting the Lenders' first lien and security interest in the additional Property as Collateral. (e) Not later than 30 days prior to any Collateral Change Date, Borrower shall deliver to the Agent six (6) copies (or a greater number in the event additional Lenders are added to the Loan) of a current environmental site assessment of each Property to be 33 38 added to the Collateral certified to the Lenders, meeting ASTM standards for "Phase I" environmental site assessments, and including an asbestos evaluation for all buildings constructed prior to 1980, prepared by Law Engineering or other environmental engineer acceptable to the Lenders. Such assessments shall be utilized by the Lenders for informational purposes, and shall be subject to review and approval by the Lenders. Additionally, not later than 30 days prior to any Collateral Change Date, Borrower shall deliver to the Agent a certification in compliance with applicable federal law relating to asbestos records and asbestos materials affecting any buildings constructed before 1980 that are to be added to the Collateral. (f) Not later than 30 days prior to any Collateral Change Date, and on the Collateral Change Date, Borrower shall deliver to the Agent a current Rent Roll for the property to be added to the Collateral. (g) On or before any Collateral Change Date, Borrower shall deliver the following materials to the Agent and the Agent's Counsel, in form and content acceptable to the Agent and the Agent's Counsel: (i) Evidence of the current corporate status of Borrower in Florida, and the current authority of Borrower to transact business in each other State in which the property to be added as Collateral is located. (ii) A certificate of the Secretary of Borrower certifying to the Lenders: (i) the completeness, accuracy and continuing effectiveness of Articles of Incorporation and Bylaws of Borrower as attached to such certificate, (ii) the names and signatures of all executive officers of Borrower, and (iii) the completeness, accuracy and continuing effectiveness of an executed resolution of the Board of Directors of Borrower, as attached to such certificate, authorizing Borrower's execution and delivery of the Loan Documents. (h) On or before any Collateral Change Date, Borrower shall deliver to the Agent evidence satisfactory to the Lenders and the Lenders' Counsel that the property to be added to the Collateral is in compliance with the insurance requirements set forth in Section 5.3, and in compliance with the tax requirements set forth in Section 5.4. (i) On or before any Collateral Change Date, Borrower shall deliver to the Agent a certification substantially in the form attached as Exhibit F, executed and dated as of a date not more than 30 days prior to such Collateral Change Date, relating to the level of compliance of the property to be added to the Collateral with Governmental Requirements. (j) On a Collateral Change Date, Borrower shall furnish Agent with an opinion addressed to the Lenders provided by an attorney licensed in each State in which the property to be added to the Collateral is located, retained by Borrower and acceptable to the Lenders. Said opinions shall be subject to approval by the Lenders and shall address 34 39 such matters as the Lenders reasonably may require, including, without limitation, the following that: (A) the due organization and valid legal existence of Borrower as a Florida corporation, and the current authority of Borrower to transact business in the State. (B) the due authorization, execution, validity, binding effect and enforceability of the Loan Documents in accordance with their terms. (C) except for Collateral located in the State of Texas, the Collateral and its use by Borrower comply with applicable zoning, building, land use and environmental requirements of all governmental authorities having jurisdiction over the Collateral (the foregoing opinion may be given to the actual knowledge of opining counsel and based on a certification of such matters given by Borrower to opining counsel). (D) all amounts paid and to be paid by Borrower as interest under the Loan Documents constitute lawful interest or are not usurious under the laws of the State. (E) the existence of, or the non-existence of, any requirement for any consent of any governmental authority in connection with the execution, delivery or performance of the Loan Documents by Borrower. (F) the Security Deed provides that a properly perfected first priority security interest in the Collateral to be added or substituted. (G) the Loan Documents are valid Obligations of the Borrower, remain in full force and effect, and provide Lender a properly perfected first priority security interest in the Collateral to be added or substituted. SECTION 4.4 Lenders' Approval of Addition or Substitution of Collateral. Each of the Lenders shall have fifteen (15) Business Days from receipt of the Due Diligence Package and any additional due diligence materials reasonably requested by Lenders pursuant to Article IV hereof, to approve any request by Borrower to add or substitute Collateral. The Lenders shall respond to the Agent with any objections within said fifteen (15) Business Days or the addition or substitution of such Collateral shall be deemed approved by such Lender. 35 40 ARTICLE V CERTAIN MATTERS CONCERNING THE COLLATERAL SECTION 5.1 Inspections. The Lenders reserve the right to require an engineering/structural inspection of any property constituting the Collateral or property to be added to the Collateral if any of the Lenders have reasonable cause to believe that the physical condition, safety features, or disabled persons access features of such building are not maintained to standards consistent with good management practices or in compliance with Governmental Requirements. Any such inspection shall be conducted at the expense of Borrower. Unless such inspection is made pursuant to the foregoing, the Lenders otherwise shall have the right to inspect the Collateral at any reasonable time throughout the Loan Term, at the expense of the Lenders. SECTION 5.2 Appraisals. During the Loan Term, the Lenders may obtain an Appraisal of the Collateral when required by the regulations of the Federal Reserve Board or at such other times as the Lenders reasonably may require. All Appraisals required under this Section 5.2, or required under any other provision of this Agreement, shall be performed by an independent third party appraiser selected by the Lenders, and shall be addressed to the Lenders with a copy certified to Borrower. Following the Lenders' receipt of such Appraisals satisfactory to the Lenders, the Lenders shall provide a copy of such Appraisals to Borrower. The cost of such Appraisals shall be borne by Borrower. The terms of engagement of any appraiser shall include a clause obligating the appraiser to maintain confidentiality of such Appraisal and information obtained in connection therewith. Borrower's failure or refusal to sign such an engagement letter, however, shall not impair the Lenders' right to obtain such Appraisals. Borrower agrees to pay the cost of such Appraisal within 10 days after receiving an invoice for such Appraisal. SECTION 5.3 Insurance. Borrower shall procure and maintain during the Loan Term an insurance policy issued by Insurer or other insurer acceptable to the Lenders in its discretion, covering the improved real property and personal property comprising the Collateral, with standards, terms and coverages meeting or exceeding those of Borrower's existing Policy No. A TL-441545 0000, issued by the Insurer, as in effect as of August 1, 1996. Such policy shall recite the Lenders' interest as mortgagee in standard non-contributory mortgagee clauses effective as of the Closing Date, or any Funding Date as to any property added to the Collateral as of such Funding Date, and shall contain a provision for 30 days prior written notice to the Lenders of cancellation of or any change in the risk or coverages insured. Borrower shall promptly pay all premiums for such policy as the same become due, and shall maintain such policy throughout the Loan Term without cost to the Lenders. If any such policy or part thereof shall expire or be withdrawn, or become void or subject to cancellation by reason of the breach of any condition thereof, or become void by reason of the failure or impairment of the capital of any company in which the insurance shall be carried, or if for any reason whatsoever the insurance shall be unsatisfactory to the Lenders, the Agent may procure on behalf of the Lenders such insurance as it deems 36 41 necessary to protect the interest of the Lenders. Borrower shall promptly upon demand pay direct or reimburse the Lenders for all premiums and other costs incurred in procuring such insurance. SECTION 5.4 Taxes and Assessments. Borrower shall pay all taxes and assessments relating to the Collateral prior to delinquency thereof, and shall deliver to the Agent receipted bills for taxes and assessments promptly upon Borrower's receipt thereof. Notwithstanding the foregoing, Borrower shall not be required to pay any taxes or assessments as long as Borrower shall contest, in good faith and at its expense, the existence, the amount or the validity thereof by appropriate proceedings; provided that such proceedings shall operate during the pendency thereof to prevent (A) the collection of, or other realization upon, such taxes or assessments so contested, (B) the sale, forfeiture or loss of the Collateral to satisfy the same, (C) any interference with the use or occupancy of the Collateral, and (D) any interference with the payment of Borrower's obligations under the Loan. Borrower agrees that each such contest shall be promptly and diligently prosecuted to a final conclusion, except that Borrower shall, as long as the conditions of the first sentence of this paragraph are at all times complied with, have the right to attempt to settle or compromise such contest through negotiations. Borrower shall pay and save the Lenders harmless against any and all losses, judgments, decrees and costs (including all reasonable attorneys' fees and expenses) in connection with any such contest and shall, promptly after the final determination of such contest, fully pay and discharge the amounts which shall be levied, assessed, charged or imposed or be determined to be payable therein or in connection therewith, together with all penalties, fines, interest, costs and expenses thereof or in connection therewith, and perform all acts the performance of which shall be ordered or decreed as a result thereof. No such contest shall subject the Lenders to the risk of any material civil liability or any criminal liability. If the Lenders reasonably believe that such contest is not in compliance with the requirements of this paragraph, then, upon written demand by any of the Lenders, Borrower promptly shall pay the amount of such taxes or assessments so contested, which payment may be made under protest. SECTION 5.5 Tax and Insurance Deposits. Upon the Lenders' request, or if an Event of Default has occurred, Borrower shall deposit with Agent a sum equivalent to 1 year's insurance premium on the casualty insurance policy insuring the Collateral, and shall pay to the Agent on a monthly basis an amount equivalent to 1/12 of all annual ad valorem real and personal property taxes and assessments levied against the Collateral as estimated by the Agent, in order to accumulate with the Agent sufficient funds to pay such taxes and assessments and a full year's insurance premiums 30 days prior to their due date. The Lenders shall maintain any funds so deposited in an interest bearing account (money market rates), and interest accrued on such account will be reinvested in such account but shall be considered income to Borrower for state and federal income tax and capital gains tax purposes. To the extent that funds are available for disbursement out of such account, the Lenders shall pay annual ad valorem real and personal property taxes 37 42 and assessments levied against the Collateral at such time as will result in the greatest discount, if any, for early payment. SECTION 5.6 Tax Service Contract; Annual Tax Searches. The Lenders shall have the right to engage Transamerica Real Estate Tax Service (TRETS) for the Loan Term, for the purpose of providing the Lenders annual tax information concerning the Collateral; provided, however, that the Lenders will notify Borrower in writing before the Lenders engage TRETS. The cost of the TRETS service, if applicable, shall be paid by Borrower. Borrower shall engage or employ the services of a tax specialist (who may be an employee of Borrower) for the purpose of monitoring and complying with all impositions of ad valorem real and personal property taxes and assessments against the Collateral. If the Lenders require Borrower to make tax deposits pursuant to Section 5.5 above, then the Lenders will not engage TRETS. Borrower agrees to permit the Lenders to consult with Borrower's tax specialist from time to time for the purpose of determining the status of Borrower's tax compliance. SECTION 5.7 Due on Sale. The entire balance of the Loan and all other sums owing to the Lenders under the Loan Documents shall be and become immediately due and payable, at the option of the Lenders, if there shall occur without the Lenders' prior written consent any sale, conveyance, further encumbrance, or other transfer of title to the Collateral, or any interest therein (whether voluntarily or by operation of law). Any consent by the Lenders permitting a transaction otherwise prohibited under this paragraph shall not constitute a consent to or waiver of any right, remedy or power of the Lenders to withhold its consent on a subsequent occasion to a transaction not otherwise permitted by the provisions of this paragraph. No such consent shall be considered by the Lenders unless the appropriate service fees and legal fees are paid in advance and no such consent shall be given unless Borrower agrees, inter alia, that immediately upon closing of the subject sale or transfer, Borrower shall provide the Lenders with a copy of the deed or other instrument conveying title to the Collateral to transferee. SECTION 5.8 Loss and Restoration following Casualty or Condemnation. (a) In the event of any casualty or condemnation affecting all or any portion of the Collateral, Borrower shall give immediate written and oral notice thereof to the Agent. All loss proceeds of any insurance policies following any casualty, and all awards derived from any condemnation, shall be applied (i) to restoration of the Collateral suffering such loss if such loss is less than 50% of the full replacement cost of such Collateral, or (ii) at the Lenders' option, to restoration of the Collateral suffering such loss or to the payment of principal (whether or not then due and payable), interest and other sums secured by the Loan Documents (in the order and in the amounts that the Lenders in their sole discretion elect), on such terms as the Lenders may specify, if such loss is 50% or more of the full replacement cost of such Collateral. If the Lenders elect, pursuant to clause (ii) above, to apply the proceeds of casualty or awards of condemnation, to payment of principal, then the Lenders will exercise a good faith effort to apply such proceeds or awards in a manner 38 43 that will seek to minimize the application of charges or penalties for prepayment or repayment of LIBOR Advances. (b) Promptly following any loss resulting from a casualty or condemnation, Borrower shall commence and diligently continue to restore the Collateral affected thereby as nearly as possible to its value, condition and character immediately prior to such loss, whether or not any insurance proceeds or award derived from condemnation, as applicable, is sufficient to cover the cost of restoration. Provided that no Event of Default exists, the Lenders shall make available to Borrower any proceeds of such loss received by the Lenders, subject to the terms and conditions set forth in this Section 5.8. Borrower shall be entitled to receive from the Lenders periodic disbursements of the proceeds payable in connection with such loss, but only on the basis of certificates of Borrower delivered to the Agent from time to time as such rebuilding, restoration and repair progresses or is completed. Each such certificate shall describe the work for which Borrower is requesting payment, the cost incurred by Borrower in connection therewith, and shall state that such work has been performed in conformity with all Governmental Requirements and in compliance with plans and specifications therefor, the estimated cost of completing such work, and that Borrower has not theretofore received payment for such work. In the event the cost of restoration or repairs exceeds the available insurance proceeds, the Borrower shall immediately fund any deficiency with Borrower's funds prior to the application of any insurance proceeds. Upon completion of such work, if any proceeds of such loss remain after the final payment has been made for such work, such remaining proceeds shall be paid to Borrower. If the cost of any such work shall exceed the amount of such proceeds, the deficiency shall be paid by Borrower. In no event shall the Lenders have any obligation to turn over proceeds to Borrower if any Default or Event of Default exists and is continuing, unless and until such Default or Event of Default shall have been cured or removed. ARTICLE VI REPRESENTATIONS AND WARRANTIES SECTION 6.1 Representations and Warranties of Borrower. Borrower represents and warrants to the Lenders as follows: (a) Borrower is a corporation organized under the Florida Business Corporation Act, and its status is active. Borrower is authorized to transact business in each State. (b) Borrower has the corporate power to conduct its business and to execute and deliver this Agreement and the other Loan Documents and to perform the Obligations. (c) Borrower has authorized the execution and delivery of the Loan Documents and the performance of the Obligations by all necessary corporate action. 39 44 (d) The execution and delivery of the Loan Documents and the performance of the Obligations by Borrower do not (i) violate Borrower's articles of incorporation or bylaws; (ii) constitute a breach of or a default under any agreement or instrument to which Borrower or any Subsidiary is a party or by which Borrower, its Subsidiaries or their respective assets are bound; (iii) violate a judgment, decree or order of any court or administrative tribunal, which judgment, decree or order is binding on Borrower or any Subsidiary or the Collateral; or (iv) violate any federal, Florida or State law, rule or regulation. (e) No consents, authorizations or approvals or other action by, and no notice to or filing with, any governmental authority, regulatory body or any creditor is required for the execution and delivery of the Loan Documents or the performance of the Obligations by Borrower. (f) The Loan Documents are the legal, valid and binding obligations of Borrower enforceable against Borrower in accordance with their respective terms. (g) Borrower is a REIT, and is listed as a publicly traded company on a nationally recognized stock exchange; and Borrower has no Subsidiaries other than the Subsidiaries described on attached Exhibit G, and such other Subsidiaries as may be formed subsequent to the date hereof and disclosed to the Lenders in writing. (h) No Subsidiary is the holder or obligee of any Debt. (i) No judicial or administrative proceedings are pending or threatened, including any bankruptcy proceeding, against Borrower or any Subsidiary which might adversely affect Borrower's ability to pay or perform the Obligations, Borrower's obligations under any Leases, or Borrower's contracts and agreements entered or to be entered for the performance of the Obligations, or which might adversely affect Borrower's ownership, management, leasing and operation of the Collateral. (j) All financial information supplied by Borrower to the Lenders in support of Borrower's application for the Loan fairly presents the financial condition of Borrower as of the effective dates thereof and the results of the operations of Borrower for the period ended on such dates, all in accordance with GAAP; and since September 30, 1998, there has been no material adverse change in such condition, operations or properties. (k) Neither Borrower nor any Subsidiary is engaged in the business of extending credit for the purpose of purchasing or carrying "margin stock" (within the meaning of Regulation U issued by the Board of Governors of the Federal Reserve System), and no proceeds of the Loan will be used, directly or indirectly, by Borrower or any Subsidiary to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock. 40 45 (l) Borrower is in compliance in all material respects with all applicable provisions of ERISA, no Reportable Event has occurred and is continuing with respect to any Plan, and Borrower has not incurred any liability to the Pension Benefit Guaranty Corporation under Section 4062 of ERISA. (m) Borrower is not in default under any material agreement, lease, contract or other instrument relating to the ownership, management, leasing and operation of the Collateral, and no event of default by Borrower, or event which with the giving of notice or the passage of time would become an event of default by Borrower, has occurred or is continuing with respect to any such agreement, contract or other instrument. (n) Borrower has good and marketable title to the Collateral (except Collateral located in the State of Texas, as to which Borrower has indefeasible fee simple title), free and clear of any liens, encumbrances not acceptable to the Lenders or mortgages other than or encumbrances in any Security Deed and other than those created or imposed by the Loan Documents, Borrower is in exclusive possession of the Collateral subject only to rights of parties in possession as tenants under recorded or unrecorded Leases, as tenants only, Borrower is the landlord under the Leases, and no Subsidiary (other than an SPE created pursuant to Section 13.12) has any interest in the Collateral, including the Leases, except as described on attached Exhibit H. (o) There are no pending or, to the best of Borrower's knowledge, threatened actions or proceedings for condemnation or eminent domain affecting the Collateral, except as disclosed to the Lenders in the title commitment delivered to the Lenders at Closing and except such actions or proceedings as may be threatened or become pending subsequent to the date hereof and disclosed to the Lenders in writing. (p) Any reprogramming required to permit the proper functioning, in and following the year 2000 as it relates to the two digit issues associated therewith, of the Borrower's (a) computer systems and (b) equipment containing embedded microchips (including systems and equipment supplied by others or with which Borrower's systems interface) and the testing of all such systems and equipment, as so reprogrammed, will be in substantial compliance by June 30, 1999. The Borrower shall report quarterly thereafter to the Agent as to the status of its progress on final phase testing to become one hundred percent (100%) year 2000 compliant. The cost to the Borrower of such reprogramming and testing and of the reasonably foreseeable consequences of year 2000 to the Borrower (including, without limitation, reprogramming errors and the failure of others' systems or equipment) will not result in a Default or a material adverse effect in the ability of the Borrower to meet its Obligations hereunder. Except for such of the reprogramming referred to in the preceding sentence as may be necessary, the computer and management information systems of the Borrower and its Subsidiaries are and, with ordinary course upgrading and maintenance, will continue for the term of this Agreement to be, sufficient to permit the Borrower to conduct its business without material adverse effect in the ability of the Borrower to meet its Obligations hereunder. 41 46 (q) All of the Collateral is in compliance with all Environmental Laws and Borrower has not received notice of any Claims for violations of any Environmental Laws, as such terms are defined in each Indemnification Agreement. The foregoing representations and warranties shall survive the execution and delivery of this Agreement. ARTICLE VII COVENANTS OF BORROWER SECTION 7.1 Affirmative Covenants. So long as the Notes shall remain unpaid or the Lenders shall have any obligation to make any Advance hereunder, and in addition to all other covenants and agreements of Borrower set forth in this Agreement, Borrower shall comply at all times with the affirmative covenants set forth in this Section 7.1 and the Financial Covenants set forth in Section 3.1, unless the Lenders shall otherwise consent in writing. (a) Costs and Expenses. Borrower shall pay all reasonable costs, fees, commissions, charges, taxes and other expenses incident to the evaluation, preparation and closing of the Loan, any subsequent modification or partial release affecting the Loan Documents, subsequent funding of Advances, or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing the Lenders' rights under the Loan Documents, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind, including, without limitation, reasonable fees and expenses of the Lenders' Counsel, examination of title to the Collateral and loan title insurance thereon, boundary surveys, Appraisals, environmental site assessments, asbestos evaluations, engineering/structural inspections, note and mortgage taxes, transfer taxes, tax search service fees, and all recording fees and charges. Additionally, to the extent that applicable state law requires that any note or mortgage tax is payable in connection with any Advance, Borrower shall be obligated to pay the same to the Lenders upon demand therefor. Every such payment made by or on behalf of the Lenders will be immediately due and payable by Borrower to the Lenders and will bear interest from the date of disbursement thereof by the Lenders at the then applicable Base Rate until reimbursed to the Lenders by Borrower (provided, however, that if Borrower fails to reimburse the Lenders for such payments within 5 days following the Lenders' written notice and demand therefor, such payments made by the Lenders will bear interest from the date of disbursement at the Default Rate), and the same, together with such interest, will be secured by the lien of the Loan Documents. Nothing contained in this paragraph will be construed as requiring the Lenders to advance or spend money for any of the purposes mentioned in this paragraph. 42 47 (b) Rent Roll. Borrower shall deliver to the Agent on a quarterly basis an updated Rent Roll reflecting information concerning the Leases as of the end of the preceding quarter, and upon the Agent's request, deliver to the Agent a certified report of prepaid rentals and security deposits relating to such Leases. (c) Compliance with Governmental Requirements. Borrower shall comply with all Governmental Requirements, including, without limitation, ERISA, regulations relating to protection of the environment, building and construction, highway access, disability access, asbestos, lead-based paint, zoning, land use and concurrency, and other regulations relating to the ownership, leasing, development, use or operation of the Collateral. (d) Preservation of Corporate Existence. Borrower shall preserve and maintain its corporate existence and status as a REIT, and its rights (charter and statutory), and remain qualified to transact business in each State. (e) Preservation and Maintenance of Collateral. Borrower shall maintain the Collateral in a condition consistent with good management practices, and in good repair (which shall include structural or non-structural and foreseen or unforeseen repairs), without structural alteration in any material respect (except interior tenant improvements), without the Lenders' prior written approval, which will not be unreasonably withheld or delayed. (f) Reporting Requirements. (i) Not later than 45 days after the end of the first three calendar quarters of each fiscal year of Borrower, Borrower shall submit to the Agent a Borrowing Compliance Certificate and a Borrowing Base Certificate, in form and content acceptable to the Lenders in its sole discretion, prepared by management and certified as true and correct by either the Treasurer, chief financial officer or chief accounting officer of Borrower, confirming Borrower's compliance with the Financial Covenants and with the Borrowing Base eligibility requirements for the Collateral set forth in Section 3.3 hereunder and setting forth in summary form the financial information and numerical calculations supporting such conclusions. (ii) Not later than 45 days after the end of the first three calendar quarters of each fiscal year of Borrower, Borrower shall submit to the Agent a copy of Borrower's Form 10Q as filed with the SEC, and not later than 90 days after the end of Borrower's fiscal year, Borrower shall submit to the Lenders a copy of Borrower's Form 10K as filed with the SEC. (iii) Borrower shall submit to the Agent, not later than one hundred twenty (120) days after the end of Borrower's fiscal year, (a) a copy of an Annual Report, (b) a three-year business plan with supporting financial projections in 43 48 reasonable detail acceptable to the Agent, and (c) a Borrowing Compliance Certificate. (iv) Borrower shall submit to the Agent copies of all special filings made by Borrower to the SEC within 15 days following the date of such filing, including, without limitation, any filings seeking approval of transactions with any Subsidiaries. (v) Borrower shall keep books and records reflecting its financial condition in accordance with GAAP. The Lenders shall have the right, from time to time, at all times during normal business hours, to examine such books, records and accounts at the corporate offices of Borrower at 8880 Freedom Crossing Trail, Jacksonville, Florida, and to make such copies or extracts thereof as the Lenders deems necessary. (vi) Borrower shall submit to the Agent, not later than forty-five (45) days after the end of each fiscal quarter of Borrower, operating statements for all Property included within the Collateral. (vii) Notwithstanding any of the foregoing reporting requirements, upon request of the Agent, Borrower shall submit to the Agent a pro forma Borrowing Compliance Certificate in order for Agent to determine the Applicable Margins for LIBOR Advances hereunder. (g) Notice of Failure to Perform. Promptly (and in any event within 5 days after the occurrence thereof) notify the Lenders of any failure by Borrower to perform or observe any Obligation. SECTION 7.2 Negative Covenants. So long as the Notes shall remain unpaid or the Lenders shall have any obligation to make any Advance hereunder, and in addition to all other covenants and agreements of Borrower set forth in this Agreement, Borrower shall comply with the negative covenants set forth in this Section 7.2, unless the Lenders shall otherwise consent in writing. (a) Use of Loan Proceeds. Borrower shall not use Loan proceeds for purposes of paying dividends or distributions to shareholders, or for funding operating expenses, it being understood that proceeds of the Loan shall be used by Borrower for general corporate purposes of Borrower including Borrower's acquisition of existing office buildings, and construction and development of new office buildings owned by Borrower located primarily in existing Koger office parks. (b) Structural Alterations. Borrower shall not erect or construct any new structures of any kind or additions or material alterations to existing buildings or other structures on the Collateral (except interior tenant improvements), without the Lenders' prior written approval, which will not be unreasonably withheld or delayed. 44 49 (c) Change in Nature of Business. Borrower shall not make any material change in the nature of its business as carried on as of the Closing Date. (d) Transactions with Subsidiaries. Borrower shall not enter into any transaction (including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service) with any Subsidiary or Affiliate of Borrower except in the ordinary course of Borrower's business and upon fair and reasonable terms that are no less favorable to it than it would obtain in a comparable arm's length transaction with any third person. Borrower shall not use proceeds of the Loan for the purpose of capitalizing or of funding the operating or capital expenses of any Subsidiary or Affiliate of Borrower. Any loans between the Borrower and any Affiliate or Subsidiary, or among any of the Affiliates or any Subsidiaries, shall be subordinate to this Loan. ARTICLE VIII DEFAULT SECTION 8.1 Events of Default. Any of the following events (each a "Default") shall, following the passage of any grace or cure period as provided below, constitute an Event of Default ("Event of Default"): (a) Borrower shall fail to make any payment of principal under any of the Notes on or before the same becomes due and payable on maturity thereof; or Borrower shall fail to make any payment of interest under any of the Notes, or any fees, costs or expenses due hereunder or thereunder, within 5 days after the same becomes due and payable. (b) Any representation or warranty made by Borrower (or any of its officers) under or in connection with any Loan Document shall be or become incorrect or untrue, or shall prove to have been incorrect or misleading in any material respect when made. (c) A transfer of any Property in violation of the due on sale restrictions set forth in Section 5.7. (d) Borrower shall fail to perform or observe any term, covenant or agreement (other than a covenant of payment) contained in any Loan Document on its part to be performed or observed, and such failure shall remain uncured for 10 days after written notice thereof shall have been given by the Lenders to Borrower, or if such failure cannot by its nature be cured within such 10 day period, Borrower shall fail to commence and diligently pursue such cure within 10 days after written notice thereof shall have been given by the Lenders to Borrower and shall fail to complete such cure within 60 days after the Lenders' initial written notice of such failure. (e) An involuntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced against Borrower, and such case or proceeding shall not be dismissed in 60 days; or a court shall 45 50 enter a decree, or a court or regulatory authority having jurisdiction over Borrower shall enter an order, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator, supervisor, rehabilitator (or similar official) of Borrower or for any substantial part of its property, or ordering the winding-up, supervision or liquidation of its affairs. (f) Borrower shall commence a voluntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case or proceeding under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator, supervisor, rehabilitator (or other similar official) of Borrower or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its indebtedness generally as the same becomes due, or shall take any corporate action in furtherance of any of the foregoing. (g) A judgment or order for the payment of money in excess of $2,500,000 shall be rendered against Borrower and either (A) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (B) there shall be any period of 10 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. (h) A default has occurred and is continuing beyond any applicable grace or cure period under any Debt (other than the Loan) in excess of $2,500,000. (i) Any material provision of the Loan Documents relating to the Lenders's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Borrower, or Borrower shall so state in writing. (j) Any of the Security Agreements shall, as a result of Borrower's acts or omissions, for any reason, except to the extent permitted by the terms thereof, cease to create a valid and, upon filing of UCC-1 financing statement(s), UCC-2 Notice Filings, or UCC-3 continuation statements, as applicable, perfected first priority security interest in any of the Collateral purported to be covered, which can be secured or perfected by such means. (k) Any default has occurred under any of the Notes, Security Deeds, or any of the other Loan Documents. (l) Any material adverse change in the financial condition of the Borrower such that the Borrower is unable to meet its Obligations hereunder or under any of the other Loan Documents. (m) Any change in the control of the Borrower or any change in the management of the Borrower such that any two of the following: Victor Hughes, J. C. Teagle, and David Hiley are no longer officers or directors of the Borrower, and such management personnel 46 51 are not replaced with officers or directors reasonably acceptable to the Majority Lenders within one hundred twenty (120) days thereof. (n) Any failure of the Borrower to comply at all times with the Financial Covenants set forth in Section 3.1. SECTION 8.2 Remedies following an Event of Default. If an Event of Default shall occur, then, at the Lenders' option, in addition to Lenders' remedies set forth in any other Loan Documents or as may be available to the Lenders at law or in equity, the Lenders may by written notice to Borrower, (A) declare the Lenders' obligation to make Advances to be terminated, whereupon the same shall forthwith terminate, and (B) declare the Notes, all accrued and unpaid interest thereon and all other amounts payable under the Loan Documents to be, and the same shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Borrower. SECTION 8.3 Default Interest. In addition to the Lenders' remedies set forth in Section 8.2, if an Event of Default occurs, then, at the Lenders' option, all unpaid Obligations shall accrue interest from the date of Default at the Default Rate. SECTION 8.4 Remedies Cumulative. No remedy, right or power conferred upon the Agent or the Lenders is intended to be exclusive of any other remedy, right or power given hereunder or now or hereafter existing at law, in equity, or otherwise, and all such remedies, rights and powers shall be cumulative. ARTICLE IX THE AGENT SECTION 9.1 Appointment, Powers and Immunities. (a) Each Lender hereby irrevocably appoints FUNB as the administrative agent to administer the Loan on behalf of all of the Lenders in accordance with the terms, covenants and conditions of this Agreement, together with such powers as are specifically delegated to the Agent and are reasonably incidental thereto. FUNB, by its execution and delivery of this Agreement, accepts such appointment and agrees to administer the Loan on behalf of all of the Lenders in accordance with the terms, covenants and conditions of this Agreement. The voting, consent and approval rights of each Lender for all matters requiring a vote or the consent or approval of the Lenders will be proportionate to all other Lenders based upon each Lender's Percentage. The Agent (i) shall not have any duties or responsibilities except those expressly set forth in this Agreement and the other Documents, and shall not by reason of this Agreement or any other Loan Document be a trustee for any Lender; (ii) shall not be responsible to any Lender for any recitals, statements, representations or warranties contained in this Agreement or any other Loan Document, or in any certificate or other document referred to or provided for in, or received 47 52 by any of them under this Agreement or any other Loan Document, or for the value, validity, effectiveness, genuineness, enforceability, execution, filing, registration, collectibility , recording, perfection, existence or sufficiency of this Agreement or any other Loan Document or any other document referred to or provided for herein or therein or any property covered thereby or for any failure by any party to perform any of its obligations hereunder or thereunder, and shall not have any duty to inquire into or pass upon any of the foregoing matters; (iii) shall not be required to initiate or conduct any litigation or collection proceedings hereunder or under any other Loan Document except to the extent requested by the Majority Lenders, (iv) SHALL NOT BE RESPONSIBLE FOR ANY MISTAKE OF LAW OR FACT OR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY IT HEREUNDER OR UNDER ANY OTHER DOCUMENT OR ANY OTHER LOAN DOCUMENT OR INSTRUMENT REFERRED TO OR PROVIDED FOR HEREIN OR THEREIN OR IN CONNECTION HEREWITH OR THEREWITH, INCLUDING, WITHOUT LIMITATION, PURSUANT TO ITS OWN NEGLIGENCE, BUT NOT INCLUDING AND EXCEPT FOR THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE AGENT; (v) shall not be bound by or obliged to recognize any agreement among or between the Borrower, the Agent, and any Lender other than this Agreement and the other Loan Documents, regardless of whether the Agent has knowledge of the existence of any such agreement or the terms and provisions thereof; (vi) shall not be charged with notice or knowledge of any fact or information not herein set out or provided to the Agent in accordance with the terms of this Agreement or any other Loan Document; (vii) shall not be responsible for any delay, error, omission or default of any mail, telegraph, cable or wireless agency or operator, and (viii) shall not be responsible for the acts or edicts of any Governmental Authority. The Agent may employ agents and attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. (b) Without the prior written consent of Agent and all of the Lenders, Agent shall not (i) modify or amend in any respect whatsoever the interest rate provisions of the Loan Documents, (ii) increase the Loan Amount above $200,000,000.00, (iii) extend the Maturity Date, (iv) extend or reduce the due date for the scheduled payments of principal or interest on the Loan, (v) amend the definition of Majority Lenders or any requirement that certain actions be taken only with the consent of a certain number of the Lenders, (vi) change any Events of Default, (vii) modify or amend the definition of Capitalization Rate or Advance Rate, (viii) modify or amend the definition of Borrowing Base Value, or (ix) modify or amend any provision of any Loan Document which by its terms requires the consent of all of the Lenders for amendment. From time to time upon Agent's request, each Lender shall execute and deliver such documents and instruments as may be reasonably necessary to enable Agent to effectively administer and service the Loan in its capacity as Agent and in the manner contemplated by the provisions of this Agreement. No amendment or agreement shall increase the Lender Commitment of any Lender without the written consent of such Lender. (c) All information provided to the Agent under or pursuant to the Loan Documents, and all rights of the Agent to receive or request information, or to inspect 48 53 information or Property, shall be by the Agent on behalf of the Lenders. If any Lender requests that it be able to receive or request such information, or make such inspections, in its own right rather than through the Agent, the Borrower will cooperate with the Agent and such Lender in order to obtain such information or make such inspection as such Lender may reasonably require. (d) The Borrower and any Guarantor shall be entitled to rely upon a written notice or a written response from the Agent as being pursuant to concurrence or consent of the Majority Lenders unless otherwise expressly stated in the Agent's notice or response. (e) Each Lender shall be responsible for its own costs and expenses associated with its review of the Loan Documents. SECTION 9.2 Reliance. The Agent shall be entitled to rely upon any certification, notice or other communication (including any thereof by telephone, telex, telecopy, telegram or cable) reasonably believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper person, and upon advice and statements of legal counsel (which may be counsel for the Borrower), independent accountants and other experts selected by the Agent. The Agent shall not be required in any way to determine the identity or authority of any person delivering or executing the same. As to any matters not expressly provided for by this Agreement or any other Loan Document, the Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder and thereunder in accordance with instructions of the Majority Lenders, and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders. If any order, writ, judgment or decree shall be made or entered by any court affecting the rights, duties and obligations of the Agent under this Agreement or any other Loan Document, then and in any of such events the Agent is authorized, in its sole discretion, to rely upon and comply with such order, writ, judgment or decree which it is advised by legal counsel of its own choosing is binding upon it under the terms of this Agreement, the relevant Loan Document or otherwise; and if the Agent complies with any such order, writ, judgment or decree, then it shall not be liable to any Lender or to any other Person by reason of such compliance even though such order, writ, judgment or decree may be subsequently reversed, modified, annulled, set aside or vacated. SECTION 9.3 Defaults. The Agent shall not be deemed to have constructive knowledge of the occurrence of a Default (other than the non-payment of principal of or interest on the Loan) unless it has received notice from a Lender or the Borrower specifying such Default and stating that such notice is a "Notice of Default". In the event that the Agent receives such a notice of the occurrence of a Default, or whenever the Agent has actual knowledge of the occurrence of a Default, the Agent shall give prompt written notice thereof to the Lenders (and shall give each Lender prompt notice of each such non-payment). The Agent shall (subject to Section 9.7 hereof) take such action with respect to such Default as shall be directed by the Majority Lenders and within its rights under the Loan Documents and at law or in equity, provided that, unless and until the 49 54 Agent shall have received such directions, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, permitted hereby with respect to such Default as it shall deem advisable in the best interests of the Lenders and within its rights under the Loan Documents in order to preserve, protect or enhance the collectibility of the Loan, at law or in equity. Provided, however, that if there is an occurrence of an Event of Default, then in no event or under any circumstances shall any of the actions described in Sections 9.1 (b)(i) through (vii) of this Agreement be taken, without in each instance the written consent of Agent and all of the Lenders. SECTION 9.4 Rights as a Lender. With respect to the Advances made, Agent, in its capacity as a Lender hereunder shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not acting in its agency capacity, and the term "Lender" or "Lenders" shall, unless the context otherwise indicates, include the Agent in its individual capacity. The Agent may (without having to account therefor to any other Lender) as a Lender, and to the same extent as any other Lender, accept deposits from, lend money to and generally engage in any kind of banking, trust, letter of credit, agency or other business with the Borrower (and any of its Subsidiaries) as if it were not acting as the Agent but solely as a Lender. The Agent may accept fees and other consideration from the Borrower (in addition to the fees heretofore agreed to between the Borrower and the Agent) for services in connection with this Agreement or otherwise without having to account for the same to the Lenders. SECTION 9.5 Indemnification. The Lenders agree to indemnify the Agent, its officers, directors, agents and attorneys, ratably in accordance with each respective Lender's Percentage, for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever (INCLUDING BUT NOT LIMITED TO, THE CONSEQUENCES OF THE NEGLIGENCE OF THE AGENT) which may be imposed on, incurred by or asserted against the Agent in any way relating to or arising out of this Agreement or any other Loan Document or any other documents contemplated by or referred to herein or therein, or the transactions contemplated hereby or thereby (including, without limitation, interest, penalties, reasonable attorneys' fees and amounts paid in settlement in accordance with the terms of this Section 9, but excluding, unless a Default has occurred and is continuing, normal administrative costs and expenses incident to the performance of its agency duties hereunder) or the enforcement of any of the terms hereof or thereof or of any such other documents, INCLUDING BUT NOT LIMITED TO THE NEGLIGENCE OF THE AGENT, provided that no Lender shall be liable for any of the foregoing to the extent they arise from the gross negligence or willful misconduct of the party to be indemnified, or from the Agent's default in the express obligations of the Agent to the Lenders provided for in this Agreement. The obligations of the Lenders under this Section 9.5 shall survive the termination of this Agreement and the repayment of the Obligations. SECTION 9.6 Non-Reliance on Agent and Other Lenders. Each Lender agrees that it has received current financial information with respect to the Borrower and that it has, independently and without reliance on the Agent or any other Lender and based 50 55 on such documents and information as it has deemed appropriate, made its own credit analysis of the Borrower and decision to enter into this Agreement and that it will, independently and without reliance upon the Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own analysis and decisions in taking or not taking action under this Agreement or any of the other Loan Documents. The Agent shall not be required to keep itself informed as to the performance or observance by any party to this Agreement or any of the other Loan Documents or any other document referred to or provided for herein or therein or to inspect the properties or books of the Borrower or any party except as specifically required by the Loan Documents. Except for notices, reports and other documents and information expressly required to be furnished to the Lenders by the Agent hereunder or under the other Loan Documents, the Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the affairs, financial condition or business of the Borrower (or any of its Subsidiaries) which may come into the possession of the Agent. Each Lender assumes all risk of loss in connection with its Lender Commitment in the Advances to the full extent of its Lender's Percentage therein. The Agent assumes all risk of loss in connection with its Lender's Percentage in the Advances to the full extent of its Lender Percentage therein. SECTION 9.7 Failure to Act. Except for action expressly required of the Agent, as the case may be, hereunder, or under the other Loan Documents, the Agent shall in all cases be fully justified in failing or refusing to act hereunder and thereunder unless it shall receive further assurances to its satisfaction by the Lenders of their indemnification obligations under Section 9.5 hereof against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. SECTION 9.8 Resignation of Agent. Subject to the appointment and acceptance of a successor Agent as provided below, the Agent may resign at any time by giving notice thereof to the Lenders and the Borrower. Upon any such resignation, (i) the Majority Lenders without the consent of the Borrower shall have the right to appoint a successor Agent so long as such successor Agent is also a Lender at the time of such appointment and (ii) the Majority Lenders shall have the right to appoint a successor Agent that is not a Lender at the time of such appointment so long as the Borrower (if no Event of Default is then in existence) consents to such appointment (which consent shall not be unreasonably withheld). If no successor Agent shall have been so appointed by the Majority Lenders and accepted such appointment within 30 days after the retiring Agent's giving of notice of resignation, then the retiring Agent may, on behalf of the Lenders, and with the consent of the Borrower which shall not be unreasonably withheld, appoint a successor Agent. Any successor Agent shall be an Eligible Assignee. Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations as Agent thereafter arising hereunder and under any other Loan Documents, but shall not be discharged from any liabilities for its actions as Agent prior to 51 56 the date of discharge. Such successor Agent shall promptly specify by notice to the Borrower its principal office. After any retiring Agent's resignation hereunder as Agent, the provisions of this Section 9 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Agent. SECTION 9.9 No Partnership. Neither the execution and delivery of this Agreement nor any of the other Loan Documents nor any interest the Lenders, the Agent or any of them may now or hereafter have in all or any part of the Obligations shall create or be construed as creating a partnership, joint venture or other joint enterprise between the Lenders or among the Lenders and the Agent. The relationship between the Lenders, on the one hand, and the Agent, on the other, is and shall be that of principals and agent only, and nothing in this Agreement or any of the other Loan Documents shall be construed to constitute the Agent as trustee or other fiduciary for any Lender or to impose on the Agent any duty, responsibility or obligation other than those expressly provided for herein and therein. SECTION 9.10 Collateral. To the extent of each Lender's Percentage, each Lender shall have a lien upon and security interest in the Collateral. The respective proportional interests of Lenders shall be equal in lien, and dignity with each other, without distinction or priority, each Lender having an undivided interest and participation in the lien or title interest granted or conveyed under the Security Deeds, the interest in Rents and Leases under the Lease Assignments, the security interests obtained under the Security Agreements, and in all other Collateral for the Loan. ARTICLE X OBLIGATIONS AND RIGHTS OF THE LENDERS Lenders shall have the following obligations and rights with respect to the Loan: SECTION 10.1 Custody of Loan Documents. All of the original Loan Documents given in connection with the Loan shall be held by Agent, except that each Lender shall hold, for its own account, custody and possession the Note payable to it. Agent will provide each Lender with 1 set of copies of the executed Loan Documents. SECTION 10.2 Account Records. Agent will keep a proper record of all transactions related to the Loan including all receipts and disbursements under the Loan Documents. Lenders will cooperate with each other in the maintenance of uniform records and accounts related to the Loan. Agent will from time to time and upon reasonable request of Lenders, furnish to the Lenders, or their designated representatives, such information pertaining to the Loan as may be contained in FUNB's books, records and accounts, and will cause its designated officers to discuss the Loan with the designated officers of Lenders. 52 57 SECTION 10.3 Collections of Payments. Agent will collect from Borrower all principal and/or interest due under the Notes, and all other amounts that may become due or payable under the Loan Documents, including payments of proceeds of condemnation awards or insurance benefit payments, and will, to the extent permitted or contemplated under this Agreement and the Loan Documents, remit the same to Lenders, in accordance with each Lender's Percentage. SECTION 10.4 Standard of Care. Agent agrees to exercise the same degree of care with respect to the Loan as it exercises in making and handling loans for its own account. Agent does not assume any responsibility for the solvency, financial condition or representations and warranties of Borrower nor shall Agent be responsible for Borrower's performance of the Obligations. No Lender shall be liable to any other Lender except for its willful misconduct or gross negligence, and in any event, such liability shall not exceed, with respect to any other Lender, the amount contributed to the Loan by such Lender, plus interest. Each Lender agrees to share, in accordance with each Lender's Percentage in the Loan, in any loss, liability or damage (including, without limitation, all costs and attorneys fees incurred in defense thereof) arising from any claim, counterclaim, defense or set off asserted against Lenders, or either of them, by Borrower or by anyone claiming by, through or under Borrower, on account of any matter or thing in relation to the Loan or the administration thereof; provided, however, that no Lender will be obligated to share in any such loss, liability or damage arising out of the gross negligence, recklessness or wilful misconduct of the other Lender. SECTION 10.5 Payment; Set Offs and Banker's Liens. If any Lender obtains any payment of principal or interest on the respective Note made payable to it other than by payment through Agent pursuant to the terms hereof, whether such payment is made by Borrower or another person or entity and whether through the exercise of a right of set off or banker's lien, such Lender shall promptly notify the other Lenders of such payment and make such adjustments with the other Lenders as may be necessary to share such payment ratably among all of the Lenders to the end that such payment, set off, or banker's lien shall inure to the benefit of each of the Lenders based upon each Lender's Percentage. All sums obtained by Lenders by such payments, set offs, and banker's liens shall be applied to the Loan. SECTION 10.6 Selection and Adjustment of Interest Rates. Should Borrower elect any LIBOR Interest Rate as the applicable rate of interest for any Advance, Agent shall promptly advise each of the Lenders of such election, and of the actual rate of interest proposed to be charged, and any applicable costs or fees associated with such election, as calculated by Agent. Agent will advise each of the Lenders of any change in an applicable rate of interest for any Advance on the same day the change is announced by telephone advice and will confirm the same by written notice to each of the Lenders sent on the following Business Day. 53 58 SECTION 10.7 Disbursements for Protection of Collateral and Collection and Enforcement of Obligations. Each Lender shall contribute, in accordance with its Lender Percentage, to any disbursement required for the protection of any of the Collateral or Lenders' security interest therein, including disbursements to pay delinquent ad valorem real estate taxes or insurance premiums; provided, however, that all such disbursements shall be first approved by Agent. Additionally, each Lender will contribute, in accordance with its Lender Percentage, to any disbursement required to pay the costs and expense of collection procedures, including payment of reasonable attorney's fees, title searches, court costs and bona fide administrative costs of Agent in taking such action. ARTICLE XI ENFORCEMENT OF THE LOAN Subject to the terms of Section 9.1, the Loan Documents shall be enforced only as hereinafter provided. SECTION 11.1 Exercise of Remedies following Event of Default. Agent shall: (a) upon the occurrence of any Event of Default; or (b) upon the written request of the Majority Lenders if any payment of principal under such Lender's Note is not made on or before its due date, or if any payment of interest, or other charges, fees or penalties, then due and payable under such Lender's Note, is not made within 5 days after its due date; or (c) promptly in the event that Agent obtains actual (but not imputed) knowledge of an Event of Default, or promptly following receipt by Agent of notice of an Event of Default. on behalf of each of the Lenders, take such appropriate action as Agent may elect in its reasonable discretion, for collection of the Loan and for protection of the realization upon the Collateral, including legal action to enforce the Loan Documents. Such action may be brought by Agent in the name of Lenders and for their proportionate benefit. Each Lender will cooperate with Agent in such collection efforts and will furnish to Agent the original of any Loan Documents held by any Lender and make available its books and records relating to the Loan. No Lender will take any remedial action following a Default or Event of Default except in accordance with the provisions of this Agreement. SECTION 11.2 Waiver of Default and Modification. No modification, amendment or waiver of any material provision of the Loan Documents, including, without limitation, waiver of any Default or Event of Default, or renewal or extension of the Loan, or change in the terms of the Notes, or release or substitution of any Collateral, shall be granted without the prior written approval of Agent. 54 59 SECTION 11.3 Foreclosure or Exercise of Power of Sale. In the event of a foreclosure and foreclosure sale of any of the Collateral, or the exercise of any power of sale available to Lenders, no Lender will bid at the sale without the concurrence of the other Lenders, except as otherwise provided herein. If a bid is entered by a Lender it shall be deemed to be a proportionate bid by such Lender in the amount of such Lender's Percentage. Any bid entered for less than the total balance of the Obligations (including interest and expenses recoverable from the proceeds of such sale) shall be deemed to have been entered on behalf of all Lenders and, if such a bid is the successful bid, the Lender which entered such bid shall cause conveyance of the Collateral pursuant to such foreclosure sale to be issued to the Lenders, as tenants in common, in shares equivalent to their respective Lender's Percentage. Any Lender shall have the right to make a bid in an amount in excess of the total balance of the Obligations (including interest and expenses which are recoverable from the proceeds of the foreclosure sale) without concurrence of the other Lenders and, if such bid is the successful bid, such Lender making such bid shall pay the other Lenders their Lender's Percentage of the outstanding Obligations and shall acquire the property for its own account, and the other Lenders shall thereafter have no further interest in the Collateral so acquired. SECTION 11.4 Disposition of Collateral After Foreclosure or Exercise of Power of Sale. In the event of the purchase of any of the Collateral on behalf of the Lenders at a foreclosure sale or by exercise of power of sale, the Lenders, as tenants in common, shall share profits and expenses (including a reasonable fee payable to any manager of the Collateral, and costs, fees and expenses associated with maintenance and sale of the Collateral) incurred in connection with the ownership and operation of such Collateral according to their respective Lender's Percentage. Disposition of such Collateral so acquired, or the respective interests of the Lenders therein, shall be as follows: (a) Upon the written approval of the Majority Lenders, any bona fide offer by an independent third party for the purchase of any portion of the foreclosed Collateral may be accepted. All Lenders shall join in any necessary instruments of conveyance of such Collateral to such party, and the net proceeds of the sale shall be distributed in accordance with each Lender's Percentage. (b) No Lender shall sell, assign, pledge or transfer any of its interest as tenant in common in Collateral acquired at any foreclosure sale, other than to an Affiliate of such Lender, until such interest is first offered for sale to the other Lenders. Such offer shall be made in writing, setting forth the name of the proposed buyer and terms and conditions of such purchase, and shall be made to the other Lenders upon the same terms and conditions, except that, if the proposed purchase involves retention of a purchase money security interest, the remaining Lender shall have the right to prepay the purchase money obligation without premium or penalty. The remaining Lenders shall have 15 days from the date of receipt of such offer to accept or reject it. 55 60 ARTICLE XII ASSIGNMENTS SECTION 12.1 Survival; Parties Bound: Successors and Assigns. (a) All representations, warranties, covenants and agreements made by or on behalf of the Borrower in connection herewith shall survive the execution and delivery of the Loan Documents, shall not be affected by any investigation made by any Person, and shall bind the Borrower and its successors, trustees, receivers and assigns and inure to the benefit of the successors and assigns of the Agent and the Lenders; provided, however, that the Borrower may not assign or transfer any of its rights or obligations hereunder without the prior written consent of the Agent and all of the Lenders, and any such assignment or transfer without such consent shall be null and void. (b) A Lender may assign part of its Lender Commitment to an Eligible Assignee so long as such assignment shall (1) include the voting rights and all other rights and obligations attributable thereto, and include a written assumption by the Eligible Assignee of the assigning Lender's obligations under the Loan Documents, (2) require the written notice to and written consent of the Borrower (so long as no Event of Default is then in existence) and the Agent, such consent not to be unreasonably withheld, (3) be in a minimum amount of $5,000,000 and in integral multiples of $5,000,000 thereafter, (4) not reduce the Lender's Lender Commitment to an amount less than $10,000,000, in the case of any partial assignment of Lender's Commitment, and (5) include payment to the Agent by the Lender of a service fee for each assignment equal to $3,000. (c) A Lender may sell participating interests in any of its Advances so long as (i) the participating Lender shall continue to be liable for its Lender Commitment and its other obligations under the Loan Documents, (ii) the Agent, the Borrower and the other Lenders shall continue to deal solely and directly with the participating Lender in connection with such Lender's rights and obligations under the Loan Documents, and (iii) the participant may not require the participating Lender to take or refrain from taking any action under the Loan Documents that is in conflict with the terms and provisions of the Loan Documents. (d) Notwithstanding any provision hereof to the contrary, any Lender may assign and pledge all or any portion of its Lender Commitment and Advances to a Federal Reserve Bank; provided, however, that any such assignment or pledge shall not relieve such Lender from its obligations under the Loan Documents. (e) The term of this Agreement shall be until the final maturity of the Notes and the payment of all amounts due under the Loan Documents. 56 61 ARTICLE XIII MISCELLANEOUS SECTION 13.1 Prior Loan Agreement. This Second Amended and Restated Revolving Credit Loan Agreement amends and restates the Prior Loan Agreement. The covenants, terms and provisions of this Agreement shall apply and shall govern the administration of the Loan and the making of Advances from and after the date of execution of this Agreement. SECTION 13.2 Amendments, Etc. No amendment, modification, release, termination or waiver of any provision of this Agreement or the other Loan Documents shall be effective unless the same shall be in writing and signed by the Lenders (as required herein) and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. SECTION 13.3 Indemnification and Limitation of Claims. Borrower hereby indemnifies and agrees to defend, protect and hold the Lenders harmless and each of their respective officers, directors, employees, attorneys and agents (collectively, the "Indemnitees") from and against any and all liabilities, obligations, losses (other than loss of profits), damages, penalties, actions, judgments, suits, claims, costs, reasonable expenses and disbursements of any kind or nature whatsoever (excluding any taxes and including, without limitation, the reasonable fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding, whether or not such Indemnitees shall be designated a party thereto), imposed on, incurred by, or asserted against such Indemnitees by a party other than Agent or another Lender in any manner relating to or arising out of (i) this Agreement or the other Loan Documents, or any act, event or transaction related or attendant thereto, the making and administration of the Loan, the use or intended use of the proceeds of the Loan, or any of the other transactions contemplated by the Loan Documents, or (ii) any liabilities and costs relating to violation of any Governmental Requirements (including without limitation the Americans with Disabilities Act, regulations and guidelines promulgated thereunder, and similar state laws and regulations), the past, present or future operations of Borrower or any Subsidiary or any of their respective predecessors in interest, or the past, present or future physical condition of the Collateral (collectively, the "Indemnified Matters"); provided, however, Borrower shall have no obligation to an Indemnitee hereunder with respect to (i) Indemnified Matters caused by or resulting from the negligent acts or omissions of such Indemnitee, as determined by a court of competent jurisdiction in a non-appealable final judgment, or (ii) any loss, cost, damage, claim or expense relating to any portion of the Collateral that accrues after title to such portion of the Collateral is transferred to the Lenders, or its successors and assigns, by foreclosure, power of sale, deed in lieu of foreclosure or otherwise. Furthermore, Borrower agrees not to assert any claim against any of the Indemnitees, on any theory of liability, for punitive damages arising out of, or in any way in connection with, the Obligations, or the other matters governed by this Agreement and the other Loan Documents. To the extent that the undertaking to indemnify, pay and hold harmless set forth in this paragraph may be unenforceable 57 62 because it is violative of any law or public policy, Borrower shall contribute the maximum portion which it is permitted to pay and satisfy under applicable law, to the payment and satisfaction of all Indemnified Matters incurred by the Indemnitees. SECTION 13.4 Notices. All notices, demands, requests for consents, consents and other communications required or permitted hereunder shall be in writing (including telefax transmission) and shall be given by (a) Prepaid United States Certified Mail, Return Receipt Requested, (b) hand delivery, (c) overnight delivery service using a reputable national or regional carrier such as United Parcel Service or Federal Express, or (d) telefax transmission with electronic receipt confirmation, to such party, addressed to it, at its address or telefax number set forth below, or at such other address or telefax number as such party may hereafter specify for the purpose of notice to the other party. Each such notice, request or communication shall be effective (a) if sent by United States Certified Mail, Return Receipt Requested, 3 Business Days following the postmark, (b) if sent by hand delivery, upon receipt thereof, (c) if sent by overnight delivery service, on the next Business Day, or (d) if sent by telefax transmission, on the same Business Day, to the address of the parties specified below. If to Borrower: Koger Equity, Inc. 8880 Freedom Crossing Trail Jacksonville, Florida 32256 Attention: Mr. David Hiley Telefax No. 904-538-8839 If to the Lenders: First Union National Bank c/o First Union Capital Markets Group One First Union Center 301 South College Street Charlotte, North Carolina 28288 Attention: John A. Schissel/REIT Banking Group Telefax No. 704/383-6205 and Guaranty Federal Savings Bank 8333 Douglas Avenue Dallas, Texas 75225 Attention: Roger Davis Telefax No. 214/360-1678 58 63 and AmSouth Bank 1900 5th Avenue North Birmingham, Alabama 35203 Attention: Katherine L. McDavid Telefax No.205/326-4075 and Citizens Bank of Rhode Island One Citizens Plaza, 4th Floor Providence, Rhode Island 02903 Attention: Lawrence S. Hershoff Telefax No. 401/282-4485 and Compass Bank 10060 Skinner Lake Drive Jacksonville, Florida 32246 Attention: David H. Sheffield Telefax No. 904/564-8906 SECTION 13.5 No Waiver; Remedies. No failure on the part of the Agent or the Lenders to exercise, and no delay in exercising, any right under any Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right under any Loan Document preclude any other or further exercise thereof or the exercise of any other right. The remedies provided in the Loan Documents are cumulative and not exclusive of any remedies provided at law or in equity. SECTION 13.6 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of Borrower, the Agent, and the Lenders and their respective successors and assigns, except Borrower shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of the Lenders. SECTION 13.7 Governing Law; Jurisdiction and Venue. The rights and obligations of Borrower, the Agent, and the Lenders with respect to this Agreement and the Notes shall be governed by, and construed in accordance with, the laws of the State of North Carolina, and the rights and obligations of Borrower, the Agent, and the Lenders with respect to any other Loan Documents shall be governed by, and construed in accordance with, the laws of the State in which the Collateral is located. Any suit, action or proceeding may be brought against Borrower under the Loan Documents in the courts of the State in which the Collateral is located or, to the extent not otherwise required by the laws of the State in which the Collateral is located in the courts of the County of Mecklenburg, State 59 64 of North Carolina, or the United States District Court for the Western District of North Carolina, as the Agent in its sole discretion may elect, and Borrower hereby accepts the nonexclusive jurisdiction of those courts for the purpose of any suit, action, or proceeding. In addition, Borrower hereby irrevocably waives, to the fullest extent permitted by law, any objection which Borrower may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to the Loan Documents or any judgment entered by any court in respect of any part thereof, and hereby further irrevocably waives any claim that any suit, action or proceeding brought in the jurisdiction selected by the Agent has been brought in an inconvenient forum. Borrower irrevocably agrees that any pleadings or service of process may be had on Borrower by mailing to Borrower at the address set forth in Section 13.4 by certified or registered mail and such mailing shall be effective for all purposes, including the establishment of personal jurisdiction of the court in any such action. SECTION 13.8 Severability. Any provision of this Agreement or the other Loan Documents which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. SECTION 13.9 Headings. Section headings used in this Agreement are for convenience only and shall not affect the construction of this Agreement. SECTION 13.10 Counterparts. This Agreement may be executed in two or more counterparts, and by the different parties on separate counterparts, each of which shall be deemed an original, but all such counterparts shall together constitute one and the same instrument, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart. SECTION 13.11 WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, THE AGENT, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THE LOAN OR THE LOAN DOCUMENTS, ANY COLLATERAL OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO BORROWER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. 60 65 SECTION 13.12 Transfer of Collateral to Special Purpose Entity. Notwithstanding the due on sale clause restricting transfer of the Collateral in Section 5.7, and subject to the prior written approval of the Agent and the restrictions contained in this section, Borrower may transfer all of the Collateral in any State to a special purpose entity ("SPE") formed specifically for the purpose of taking title to all of the Collateral in such State to reduce franchise tax liability in accordance with the applicable law of such State. In order to obtain approval of the transfer by the Agent, Borrower shall provide the Agent with a complete set of organizational documents for the SPE, including, without limitation, articles of incorporation, bylaws, corporate resolutions, certificates of good standing, certificates of existence, authorizations to transact business in the State, articles of organization, operating agreements, management agreements, agency agreements, partnership and limited partnership agreements, joint venture agreements, certificates of limited partnership, and certificates of authority, all as applicable. Borrower shall also submit copies of all proposed conveyance documents in connection with any such transfer, and Borrower will pay and indemnify Agent and the Lenders from and against any and all costs, fees, expenses, or intangible, documentary stamp tax, or other taxes associated therewith, or with Lenders' review of such documentation. Agent shall have the right to approve such documents in its reasonable discretion. Notwithstanding the foregoing, Agent shall have the right to prohibit the transfer of any Collateral to an SPE if such SPE is not a wholly-owned Subsidiary, or a limited partnership in which the general partner and limited partners are not wholly-owned Subsidiaries, or a limited liability company in which the member or members are not wholly-owned Subsidiaries, of Koger, or is not otherwise controlled by Koger in a manner acceptable to the Lenders in their sole discretion. The Borrower shall effect any such transfer of Collateral only after receipt of written notice from the Agent approving such transfer, and Borrower shall convey any such Collateral by a deed reviewed and approved by Agent in its reasonable discretion. The transferee SPE shall also execute an Assumption Agreement in the form attached hereto as Exhibit K, pursuant to which such SPE shall become a Borrower under the Loan, and further pursuant to which such SPE shall agree to assume all of the obligations of the Borrower under this Agreement, the Notes and the other Loan Documents and to abide by all of the terms and conditions thereof including, without limitation, the Financial Covenants set forth in Section 3.1. The Assumption Agreement shall explicitly provide that such assumption of the Loan by the SPE shall not release the Borrower from any obligations under the Loan Documents. In the event of any Default or event which with notice or the passage of time would constitute a Default hereunder, Borrower shall be prohibited from making any transfer of any Collateral hereunder. Notwithstanding anything herein to the contrary, Borrower's transfer of Collateral to an SPE in accordance with the requirements of this subsection, shall not constitute a violation of any representation or warranty herein or render any such representation or warranty untrue, which, but for the transfer to the SPE would otherwise be true and accurate in all respects. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 61 66 IN WITNESS WHEREOF, Borrower, the Agent, and the Lenders have caused this Agreement to be executed as of the date first above written. BORROWER: KOGER EQUITY, INC., a Florida corporation By: /s/ G. Danny Edwards ----------------------------------------- Name: G. Danny Edwards --------------------------------------- Title: Treasurer -------------------------------------- AGENT: FIRST UNION NATIONAL BANK, a national association, as Agent By: /s/ David M. Blackman ----------------------------------------- Name: David M. Blackman --------------------------------------- Title: Vice President ---------------------------- LENDERS: FIRST UNION NATIONAL BANK, a national association By: /s/ David M. Blackman ----------------------------------------- Name: David M. Blackman --------------------------------------- Title: Vice President ---------------------------- GUARANTY FEDERAL BANK, F.S.B., a federal savings bank By: /s/ Richard V. Thompson ----------------------------------------- Name: Richard V. Thompson --------------------------------------- Title: Vice President ---------------------------- 62 67 AMSOUTH BANK, a state banking corporation By: /s/ Arthur J. Samuel, III ----------------------------------------- Name: Arthur J. Samuel, III --------------------------------------- Title: Vice President ---------------------------- CITIZENS BANK OF RHODE ISLAND, a Rhode Island financial institution By: /s/ Lawrence S. Hershoff ----------------------------------------- Name: Lawrence S. Hershoff --------------------------------------- Title: Vice President ---------------------------- COMPASS BANK, an Alabama banking corporation By: /s/ David H. Sheffield ----------------------------------------- Name: David H. Sheffield --------------------------------------- Title: Vice President ---------------------------- SCHEDULE OF EXHIBITS: Exhibit A - Description of Real Property Subset 1 - Existing Properties Included Within Collateral Subset 2 - New Properties Included Within Collateral Exhibit B - Summary Requirements for Additions to Collateral Pool Properties Exhibit C - Notice of Swing Line Borrowing Exhibit D - Minimum Standards and Supplementary Requirements for Surveys Exhibit E - Minimum Title Standards Exhibit F - Form of Certificate of Compliance with Use and Occupancy Laws Exhibit G - Schedule of Borrower's Subsidiaries Exhibit H - Schedule of Subsidiaries' Interest in Collateral Exhibit I - Form of Quit Claim Deed with Reservations and Grants of Easements Exhibit J - Form of Borrowing Compliance Certificate Exhibit K - Form of Assumption Agreement 63 68 EXHIBIT A - DESCRIPTION OF REAL PROPERTY [insert metes and bounds description of each building constituting Collateral] 69 SUBSET 1 - EXISTING PROPERTIES INCLUDED WITHIN COLLATERAL DeKalb County, Georgia - ---------------------- Columbia Building Rhodes Building Cornell Building Oglethorpe Building Dartmouth Building Rutgers Building Drake Building Stanford Building Harvard Building Stetson Building Hollins Building Vanderbilt Building Lincoln Building Williams Building Yale Building Guilford County, North Carolina - ------------------------------- Asheville Building Lenoir Building Boone Building Morehead Building Henderson Building Pinehurst Building Hickory Building Rockingham Building Kinston Building Salem Building Koger Building Wilmington Building Wrightsville Building Mecklenburg County, North Carolina - ---------------------------------- Beaufort Building Koger Building Brunswick Building Kogerama Building Catawba Building Rowan Building Davie Building Rutherford Building Granville Building Scotland Building Hatteras Building Wilson Building Greenville County, South Carolina - --------------------------------- Allendale Building Edgefield Building Lancaster Building 70 SUBSET 2 - NEW PROPERTIES INCLUDED WITHIN COLLATERAL Jefferson County, Alabama - ------------------------- 3700 Building 3800 Building 4100 Building 4200 Building Buildings A-F & Cinema, The Shops at the Colonnade DeKalb County, Georgia - ---------------------- Cambridge Building Colgate Building Davidson Building Duke Building Fordham Building McGill Building Oxford Building Tulane Building Gwinnett County, Georgia - ------------------------ Gwinnett Building Bexar County, Texas - ------------------- Atrium Building Pacific Plaza Building 71 EXHIBIT B - SUMMARY REQUIREMENTS FOR ADDITIONS TO COLLATERAL POOL PROPERTIES [attach from Loan Commitment] 72 EXHIBIT C - NOTICE OF SWING LINE BORROWING 73 EXHIBIT D - MINIMUM STANDARDS AND SUPPLEMENTARY REQUIREMENTS FOR SURVEYS [attach from Loan Commitment] 74 EXHIBIT E - MINIMUM TITLE STANDARDS [attach from Loan Commitment] 75 EXHIBIT F - FORM OF CERTIFICATE OF COMPLIANCE WITH USE AND OCCUPANCY LAWS CERTIFICATE OF COMPLIANCE WITH USE AND OCCUPANCY LAWS The undersigned, being the ____________________________ of KOGER EQUITY, INC., a Florida corporation ("Koger") does hereby, on behalf of Koger and by authority duly given, certify to FIRST UNION NATIONAL BANK, a national association ("Agent"), AmSOUTH BANK, a state banking corporation, GUARANTY FEDERAL BANK, F.S.B., a federal savings bank, CITIZENS BANK OF RHODE ISLAND, a Rhode Island financial institution, and COMPASS BANK, an Alabama banking corporation (collectively with the Agent, the "Lenders") the following as of the date hereof: 1. Koger understands that the Lenders are relying upon this Certificate, and will continue to rely upon this Certificate, in connection with the transactions contemplated in that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998, by and among Koger and the Lenders (the "Loan Agreement"). All capitalized terms used herein and not defined herein shall have the meanings given to them in the Loan Agreement. 2. To the best of Koger's knowledge and except as disclosed on Exhibit A attached hereto, the Collateral encumbered by the Loan Documents and the use thereof by Koger, is in material compliance with all laws, ordinances, rules and regulations of all governmental authorities having jurisdiction over the Collateral, including, but not limited to, all applicable zoning, building, occupancy, land use and environmental requirements of all governmental authorities having jurisdiction over the Collateral, except state and federal laws and regulations governing facilities accessibility for disabled persons (such as the Americans with Disabilities Act Accessibility Guidelines) (the laws, ordinances, rules and regulations referred to above being collectively referred to as the "Use and Occupancy Laws"). 3. Certificates of compliance with the Use and Occupancy Laws, if issued in the ordinary course of business by the applicable governmental authority, have been issued with respect to the Collateral and those certificates have not been revoked. 4. Koger has received no notice from any governmental body, agency or department or from any other source that the Collateral, or Koger's use thereof, is in violation of or conflict with any of the Use and Occupancy Laws. 5. Koger understands and agrees that it has an affirmative duty to promptly notify the Lenders upon its becoming aware of, or upon its receipt of notice regarding, any assertion by a governmental authority, or any action or proceeding commenced by any person, seeking damages relating to, or seeking to cause or enforce compliance with, the Use and Occupancy Laws. Such notice shall be in writing and shall specifically identify the nature of such assertion, action or proceeding, and the Collateral affected thereby. 76 6. Koger understands and agrees that it has an affirmative duty to promptly remedy any noncompliance with the Use and Occupancy Laws upon written request therefor by the Lenders following any assertion by a governmental authority, or any action or proceeding commenced by any person, seeking damages relating to, or seeking to cause or enforce compliance with, the Use and Occupancy Laws. Koger hereby indemnifies and agrees to hold harmless the Lenders from and against all claims, demands and expenses related to such claims and demands, including reasonable attorneys' fees and paralegals' fees, arising from any noncompliance with the Use and Occupancy Laws; provided, however, this indemnity will not extend to any damage, liability or loss resulting from the negligence, recklessness or wilful misconduct of the Lenders (it being understood, however, that none of the Lenders will be deemed to have, or to have assumed, any duty to confirm, cause, guaranty or underwrite, compliance of the Collateral with the Use and Occupancy Laws). IN WITNESS WHEREOF, the undersigned has executed and delivered this Certificate as of the 30th day of December, 1998. KOGER EQUITY, INC., a Florida corporation By: ----------------------------------------- Name: --------------------------------------- Its: ---------------------------------------- STATE OF ) --------------------------- COUNTY OF ) -------------------------- The foregoing instrument was acknowledged before me this _____ day of ______________, 199___, by ____________________________________________, the ___________________ of KOGER EQUITY, INC., a Florida corporation, on behalf of the corporation, who either ____ is personally known to me or ____ has produced identification in the form of _____________ driver's license. -------------------------------------------- Print Name: --------------------------------- Notary Public, State of --------------------- Commission No. ------------------------------ My Commission Expires: ---------------------- [NOTARIAL SEAL] 77 EXHIBIT G - SCHEDULE OF BORROWER'S SUBSIDIARIES Entities to be consolidated in KE's Financial Statement: SOUTHEAST PROPERTIES HOLDING CORPORATION: ("Southeast") A Florida Corporation wholly-owned by Koger Equity, Inc. Pursuant to the Merger of KPI into Koger Equity, Southeast became the managing general partner of The Koger Partnership, Ltd. Southeast was responsible for handling the liquidation of The Koger Partnership, Ltd. KOGER REAL ESTATE SERVICES, INC.: A Florida corporation wholly-owned by Koger Equity, manages 21 office buildings owned by Centoff Realty Company, Inc., a subsidiary of Morgan Guaranty Trust Company of New York. 78 EXHIBIT H - SCHEDULE OF SUBSIDIARIES' INTEREST IN COLLATERAL NONE 79 Prepared by and Return to Charles L. Cranford Martin, Ade, Birchfield & Mickler P.A. P.O. Box 59 Jacksonville, Florida 32201 EXHIBIT I - FORM OF RELEASE DEED For Clerk's Use Only QUIT CLAIM DEED WITH RESERVATIONS AND GRANTS OF EASEMENTS WHEREAS, __________________________________, a national banking association (the "Trustee"), is the trustee under that certain Deed of Trust from KOGER EQUITY, INC., a Florida corporation ("KEI"), recorded in ____________ Book _____, page _____, of the public records of __________ County, _______________, an Assignment of Leases and Rents recorded in _____________ Book ______, page _____, and a financing statement recorded in _______ Book _____, page _____, of said records (collectively, the "Security Instrument"); and WHEREAS, the Trustee has been requested to release the premises hereinafter described, from the lien and operation of the Security Instrument and to quit claim Trustee's interest therein to KEI; and WHEREAS, the Trustee will retain an interest in certain properties adjacent to the property conveyed hereby. NOW, THEREFORE, for valuable consideration, the Trustee does hereby grant, convey, transfer and quit claim to KEI all of Trustee's interest in that parcel of land more particularly described on Exhibit A attached hereto (the "Property"), reserving to Trustee the following described easements over the Property and granting to KEI easements over the lands retained by Trustee, all such easements being subject to the terms and conditions contained herein. 1. Reservation of Access Easements. Trustee hereby reserves unto Trustee a non-exclusive, perpetual easement over, across and upon the parcel of land described in Exhibit B attached hereto ("Parcel 1") for vehicular and pedestrian ingress and egress. 2. Grant of Access Easement. Trustee hereby grants to KEI, and subordinates the lien of the Security Instrument to, a non-exclusive, perpetual easement over, across and upon the parcel of land described in Exhibit C attached hereto ("Parcel 2") for vehicular and pedestrian ingress and egress. 3. Reservation of Water/Sewer Utility Easements. Trustee hereby reserves a non-exclusive, perpetual easement over, under, across and upon the parcel of land described in Exhibit D attached hereto ("Parcel 3") for the construction, operation, repair and maintenance of [water/sanitary sewer] utility lines. 80 4. Grant of Water/Sewer Utility Easement. Trustee hereby grants to KEI, and subordinates the lien of the Security Instrument to a non-exclusive, perpetual easement over, under, across and upon the parcel of land described in Exhibit E attached hereto ("Parcel 4") for the construction, operation, repair and maintenance of [water/sanitary sewer] utility lines. 5. Reservation of Drainage Easement. Trustee hereby reserves a non-exclusive, perpetual easement under and through the parcel of land described in Exhibit F attached hereto ("Parcel 5") for the construction, operation, repair and maintenance of storm water drainage. The easement reserved pursuant to this paragraph 5 for storm water drainage is strictly for the placement and use of underground improvements and lines, and nothing herein shall permit the placement of improvements or structures at or above surface level. 6. Reservation of Drainage Easement. Trustee hereby grants to KEI, and subordinates the lien of the Security Instrument to a non-exclusive, perpetual easement under and through the parcel of land described in Exhibit C attached hereto ("Parcel 3") for the construction, operation, repair and maintenance of storm water drainage. The easement granted pursuant to this paragraph 6 for storm water drainage is strictly for the placement and use of underground improvements and lines, and nothing herein shall permit the placement of improvements or structures at or above surface level. 7. Each party shall have the right to have landscaping, roadways, parking and other paving and related improvements over and upon such of Parcel 3, Parcel 4, Parcel 5, and Parcel 6 as are owned by such party; provided, however, that the fee owner shall have no right to construct or place any buildings or other improvements over and upon such Parcels which would materially impair or interfere with the intended purpose of such easement or violate the terms of any permit required for the operation of the facilities therein. Without limiting the foregoing, all parties hereto consent to the existing improvements within such Parcels. 8. Maintenance and Repair of Access Easement Areas. The owner owning fee title thereto shall repair and maintain Parcel 1 and Parcel 2 (including, but not limited to the paving, striping, landscaping and lighting thereon) in such a condition so as to permit the reasonably unobstructed use and enjoyment of the easements herein granted. 9. Maintenance and Repair of Easement Areas other than Access Easement Areas. Each party shall maintain and repair all storm water drainage, water and sanitary sewer facilities and lines used exclusively by it, and shall also maintain and repair all other storm water drainage, water and sanitary sewer facilities and lines located on lands owned in fee by such party which are used by Trustee and KEI. All maintenance and repair work performed by KEI and Trustee shall be done only with reasonable prior written notice to the other and at such times and in such manner so as to reasonably avoid interference with the other's use of its lands and the business conducted thereon. All maintenance and repair work performed by KEI and Trustee shall be completed in a timely and first class 81 manner, and the premises shall be restored to substantially the same condition as existed prior to the need for the maintenance or repair (including any repaving, resurfacing or relandscaping of the surface necessitated by the maintenance or repair). The party performing or having performed the maintenance or repair shall indemnify and hold harmless the fee owner of the parcel for any cost, loss, damage or expense arising from said maintenance or repair. 10. Cost Sharing. Each owner shall bear the total cost of maintaining any storm water drainage and water and sanitary sewer utility facilities and lines serving only such owner's lands. The cost to maintain any storm water drainage, or water or sanitary sewer utility facilities or lines, the use of which is shared by more than one owner, shall be apportioned among the owners based upon the following parameters. For storm water drainage and retention, and ingress and egress easements, the cost of maintenance shall be apportioned based upon the respective land area of the lands served by such facilities. With respect to water and sanitary sewer lines, the cost of maintenance shall be apportioned based upon the number of enclosed, heated square feet within the improvements located on the respective lands served by such facilities. 11. Taxes. Each owner of land on which a Parcel is located shall pay, prior to delinquency, all taxes assessed against its respective land, and upon request, furnish proof of payment to the other owner. 12. Exercise of Easement Rights. The exercise of the easement rights granted herein shall be conducted so as not to unreasonably interfere with the use and enjoyment of the other persons entitled to use or enjoy the respective parcels affected by this Agreement. The owner of the servient estate of any easement granted hereunder shall have the right to use the relevant easement area for any purpose which does not unreasonably interfere with or impair the reasonable use and benefit of such easement for its intended purposes. 13. Indemnity. No fee owner of any Parcel under this Agreement shall be responsible to any other owner, or to any of the other owner's agents, employees, tenants, invitees or licensees for any loss, expense or damage other than such loss, expense or damage as is caused by the negligence or other fault of any such fee owner, its agents, contractors or employees. Each owner agrees to indemnify and hold the other owner harmless from any and all liability, loss, expense, damage (including attorneys' fees and paralegals' fees) and claims arising from or alleged to arise from use of the easements granted under this Agreement by such first owner's agents, contractors, employees, tenants, invitees or licensees. 14. Default and Remedies. a. In General. In the event of a breach by any party under this Agreement of any obligation set forth under this Agreement, the non-breaching party shall be entitled to injunctive relief mandating compliance with this Agreement and to obtain a 82 decree specifically enforcing the performance of the obligation; the parties acknowledge and stipulate the inadequacy of legal remedies and the irreparable harm which would be caused by any such breach. Notwithstanding the foregoing, each non-breaching party shall also be entitled to relief by any and all other available, legal and equitable remedies from the consequences of such breach. Any costs and expenses of such proceeding including reasonable attorneys' and paralegals' fees, shall be paid by the breaching party. No breach of the provisions of this Agreement shall entitle any owner or any third party to cancel, rescind and/or otherwise terminate this Agreement, but such limitation shall not affect in any manner any of the other rights and remedies which such party may have under this Agreement by reason of any breach of the provisions of this Agreement. No breach of the provisions of this Agreement shall defeat or render invalid the lien of any mortgage made in good faith for value covering any part of the Parcels under this Agreement or any improvements thereon. b. Self Help. In addition to those remedies provided above, if any party (the "Defaulting Party") shall default in the performance of an obligation of such Defaulting Party under this Agreement, which default adversely affects any other owner (the "Affected Party"), the Affected Party, after 30 days' prior written notice to the Defaulting Party and any Mortgagee (as hereinafter defined) having a lien on the parcel held by the Defaulting Party (providing that such Mortgagee, as the case may be, shall have given written notice to the Affected Party of the name and address of such Mortgagee), or, in the event of any emergency, after such notice as is practical under the circumstances, shall have the right to perform such obligation on behalf of the Defaulting Party. In such event, if the Affected Party does, in fact, perform such obligation on behalf of the Defaulting Party, the Defaulting Party shall promptly, after being given written notice of the fact and amount of such expenditure by the Affected Party, reimburse the Affected Party for the Defaulting Party's share of the reasonable cost thereof (not exceeding prevailing rates for like or similar work and materials, as applicable), together with interest thereon from the date of the Affected Party's outlay at a rate (the "Default Rate") equal to twelve percent (12.0%) per annum, plus reasonable collection fees. 15. Mortgagee Rights. The owner and holder of any mortgage lien, deed of trust, or similar instrument encumbering lands benefitted by a Parcel, or part thereof (a "Mortgagee") shall have the same rights as its respective mortgagor hereunder, including the right to cure defaults of its mortgagor and to seek curative actions and exercise enforcement rights under this Agreement. 16. Notices and Communications. All notices, requests, demands and other communications hereunder shall be in writing and transmitted to the other party or parties by either (i) hand or courier delivery; (ii) Federal Express or similar overnight courier delivery; or (iii) U.S. certified mail, return receipt requested, postage prepaid. All notices are to be hand delivered or mailed to the addresses indicated on the address of the party as shown by the tax rolls or to such other address as shall be furnished in writing by any party to the other parties. 83 17. Duration of Easements. The easements herein granted (a) are perpetual; (b) are non-exclusive; (c) run with the land; and (d) are binding upon all and inure to the benefit or, as the case may be, burden of all the assigns and successors of the respective owners. 18. No Dedication. Nothing contained herein shall create any easement or other rights in the respective parcels in the general public; provided, however, that this provision shall not restrict the intended use by the grantees (and their respective successors, assigns, tenants, invitees, guests and customers) of the easements herein granted. IN WITNESS WHEREOF, the parties have executed this instrument on the ____ day of ______________, 1998. [APPROPRIATE SIGNATURE BLOCKS AND ACKNOWLEDGMENTS TO BE INSERTED] 84 EXHIBIT J - FORM OF BORROWING COMPLIANCE CERTIFICATE BORROWING COMPLIANCE CERTIFICATE The undersigned, _______________________________________, the ___________________________ of Koger Equity, Inc. ( the "Borrower") hereby certifies to First Union National Bank (the "Agent"), __________________, _______________, and ________________ (collectively with the Agent, the "Lenders"), the following pursuant to Section 3.1(c) and 3.1(d) of Second Amended and Restated Revolving Credit Loan Agreement dated as of December ___, 1998 between Borrower and Agent for the benefit of the Lenders (as amended, supplemented or restated from time to time, the "Loan Agreement") (capitalized terms not otherwise defined in this Certificate will have the meanings assigned to such terms in the Loan Agreement): 1. Pursuant to Article III of the Loan Agreement, Borrower has requested an Advance in the amount of $_________________ for disbursement on ______________, 199___ (the "Funding Date"); 2. After giving effect to such Advance, the outstanding principal balance of the Loan as of the Funding Date will be $___________________. The undersigned has reviewed and is familiar with the terms of the Loan Agreement and has made a review of the transactions, financial condition and other affairs of Borrower for the relevant accounting period ending on _________________, 19__ (the "Current Accounting Period") and, on the basis thereof: (a) Schedule 1 attached hereto accurately and completely sets forth the calculations required to establish Borrower's compliance with the Financial Covenants set forth in Section 3.1(a) of the Loan Agreement as of the date of the financial statements for the Current Accounting Period; and (b) The aggregate outstanding principal amount of the Loan, after giving effect to such Advance does not exceed the maximum borrowing availability as calculated on Exhibit C of the Loan Agreement. 3. As of the date hereof and as of the Funding Date: (a) Borrower is in material compliance with the Financial Covenants set forth in Section 3.1(a) of the Loan Agreement, both before and after giving effect to such Advance and to the application of proceeds therefrom; (b) All of the Collateral is in material compliance with all of the eligibility parameters set forth in Section 3.3 of the Loan Agreement; (c) Borrower is in material compliance with all of the terms, covenants and conditions of the Loan Documents, no Default or Event of Default presently exists or is continuing, and no event or condition has occurred or is continuing, or would result from such Advance or from the application of proceeds therefrom, which would constitute a Default or Event of Default; and (d) Borrower's representations and warranties set forth in Section 6.1 of the Loan Agreement remain true and correct in all material respects, both before and after giving effect to such Advance and to the application of proceeds therefrom, except to the extent such representations and warranties specifically relate to an earlier date or such representations or warranties have become untrue by reason of events or conditions otherwise permitted under the Loan Agreement or the other Loan Documents. IN WITNESS WHEREOF, the undersigned has signed this Borrowing Compliance Certificate on behalf of Borrower on and as of _________________, 199___. -------------------------------------------- Name: --------------------------------------- Title: -------------------------------------- [this document must be signed by Borrower's Chief Financial Officer, Chief Accounting Officer or Treasurer] [this document must include attached Schedule 1 Financial Covenant compliance calculations]3 85 EXHIBIT K - FORM OF ASSUMPTION AGREEMENT ASSUMPTION AGREEMENT This Assumption Agreement (the "Agreement") is made and entered into as of this ______ day of ________, 1998, by and between________________________ a ___________________________ (corporation, limited liability, limited partnership) (the "SPE"), and First Union National Bank, as Agent (the "Agent") for the Lenders under that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December ___, 1998, between Koger Equity, Inc., a Florida corporation ("Koger"), the Agent, and the Lenders (the "Loan Agreement"). WHEREAS, Koger has obtained the written approval of Agent to transfer all of the Collateral in the State of ________ to the SPE pursuant to that certain letter from the Agent to Koger dated _________; and WHEREAS, the SPE has been created by Koger as a wholly owned Subsidiary functioning as a special purpose entity to acquire title to all of the Collateral in the State of ________; and WHEREAS, to induce the Agent to grant its approval of the transfer of the Collateral to the SPE, the SPE has agreed to enter into this Agreement, pursuant to which the SPE shall assume all of the terms and conditions of the Notes, the Loan Agreement, the Security Deeds recorded in the State of _______, and all of the other Loan Documents; NOW, THEREFORE, in consideration of the premises contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the SPE, Koger and the Agent hereby agree as follows: 1. The recitals set forth above are true and correct and are incorporated herein by this reference. 2. The SPE hereby assumes and agrees to perform all of Koger's obligations and duties including, but not limited to all of Koger's repayment obligations under the Loan, the Notes, the Loan Agreement, and all of the other Loan Documents from and after the date of this Agreement. The SPE hereby acknowledges that the Collateral transferred to it by Koger in the State of _________ is subject to that certain Mortgage, Security Agreement, and Assignment of Rents and Leases recorded in Official Records Book ______, Page ______, of the public records of _________ County, ________ (the "Mortgage"). By execution hereof, the SPE agrees to abide by all of the terms and conditions of said Mortgage. 3. The Agent, by execution hereof, consents to the transfer of the Collateral subject to the SPE's execution of this Agreement assuming of all the terms and conditions of each of the Notes, the Loan Agreement, the Mortgage, and each of the other Loan Documents. 86 4. By execution hereof and notwithstanding the SPE's assumption of Koger's duties and obligations under the Loan Documents, Koger ratifies and confirms all of its obligations under the Notes, the Loan Agreement, and the other Loan Documents, and Koger acknowledges that it remains fully liable for all of its obligations thereunder. 5. Execution of this Agreement shall not release the Borrower, or any existing SPE, from any of its obligations as a Borrower under the Loan. 6. Capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Agreement. IN WITNESS WHEREOF, Koger, the SPE, and the Agent have executed this Agreement as of the date first written above. SPE: By: ------------------------------------- Name Its: ------------------------------------ KOGER EQUITY, INC., a Florida corporation: By: ------------------------------------- Name Its: ------------------------------------ AGENT: FIRST UNION NATIONAL BANK, a national association, as Agent By: ------------------------------------- Name Its: ------------------------------------ EX-10.(K)(2)(A) 3 SUBSITUTION REVOLVING PROMISSORY NOTE 1 EXHIBIT 10(k)(2)(a) SUBSTITUTION REVOLVING PROMISSORY NOTE $45,000,000.00 St. Marys, Georgia December 30, 1998 FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of FIRST UNION NATIONAL BANK, a national association ("Payee"), which term will include any subsequent holder hereof, at the offices of Payee located at 301 South College Street, Charlotte, North Carolina 28288, or at such other place as Payee may designate in writing from time to time, in legal tender of the United States of America, the principal sum of FORTY-FIVE MILLION AND NO/100 DOLLARS ($45,000,000.00) or so much thereof as may be outstanding from time to time as Advances (the "Principal Amount") pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated December 30, 1998 between Maker, as borrower, and Payee, as Agent for the Lenders (the "Loan Agreement"), and all applicable fees, charges, costs and expenses, together with interest on each Advance at the applicable rate(s) of interest as provided below. The Loan Agreement by this reference is hereby incorporated into this Note to the same extent as if fully set forth herein. Capitalized terms not otherwise defined in this Note will have the meanings assigned to such terms in the Loan Agreement. Interest on each Advance outstanding under this Note from time to time will accrue, at Maker's election, at a LIBOR Interest Rate or the Base Rate (as defined below), subject to the terms, covenants and conditions of the Loan Agreement. Absent an Event of Default, the rate of interest charged on each LIBOR Advance will remain constant during the Interest Period elected for such LIBOR Advance, but will be adjusted based on any change in the LIBOR Interest Rate for any subsequent Interest Period applicable to such LIBOR Advance, and the rate of interest charged on each Base Rate Advance will be adjusted on a daily basis upon any changes in the Base Rate. For purposes of the foregoing, the following terms will have the meanings assigned to such terms as set forth below: (a) "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Maker) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by Agent from another recognized source or interbank quotation) in an amount - -------- NOTE: THIS SUBSTITUTION REVOLVING PROMISSORY NOTE SUBSTITUTES AND REPLACES THAT CERTAIN SUBSTITUTION REVOLVING PROMISSORY NOTE FROM MAKER TO PAYEE DATED DECEMBER 29, 1997. 1 of 5 2 approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. (b) "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Maker) plus the applicable margin based upon the Maker's leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) under the Loan Agreement ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. (c) "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of First Union National Bank) published or announced by First Union National Bank from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. All accrued but unpaid interest on the Principal Amount will be due and payable monthly, commencing on January 10, 1999, and continuing on the 10th day of each successive calendar month until this Note is fully paid. If not sooner paid in full, the entire Principal Amount, together with all accrued and unpaid interest, and any and all fees, costs, and expenses hereunder, will be due and payable on December 30, 2001 (the "Maturity Date"). Subject to the terms, covenants and conditions of the Loan Agreement and this Note, the Principal Amount may be repaid and reborrowed from time to time upon Maker's request; provided, however, that Payee will have no obligation to make any Advances if a Default or Event of Default exists. TIME IS OF THE ESSENCE of this Note. THE LOAN EVIDENCED BY THIS NOTE IS PAYABLE IN FULL ON THE MATURITY DATE. MAKER MUST REPAY THE ENTIRE OUTSTANDING PRINCIPAL 2 of 5 3 BALANCE OF THIS NOTE AND UNPAID INTEREST THEN DUE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. Unless Maker prior to or contemporaneously with the repayment or prepayment of all or any portion of the Principal Amount designates in writing to Payee the Advance that should be credited with such repayment or prepayment, such repayment or prepayment will be applied by Payee to Advances on a first-borrowed, first-repaid basis. Absent an Event of Default, any payments received for application to any Advance, or as applied by Payee to any Advance, as provided above, will be applied to the principal balance of such Advance; provided, however, that if an Event of Default then exists, Payee may apply such repayment or prepayment first to late charges and fees, then to interest to the extent accrued, and then to the principal balance of such Advance, or in such other manner as Payee may elect. Repayments and prepayments of any Advances accruing interest at a LIBOR Interest Rate may be subject to a charge pursuant to Section 2.5 of the Loan Agreement. Repayments and prepayments of any Advances accruing interest at the Base Rate may be made without premium or penalty. Prepayment in part will not affect, vary or postpone the duty of Maker to pay all obligations when due, and it will not affect or impair the right of Payee to pursue all remedies available to it hereunder or under the other Loan Documents. Maker's failure to make any payment of principal under this Note on or before the same becomes due and payable on maturity hereof, or Maker's failure to make any payment of interest under this Note, or any fees, costs or expenses due hereunder or under the Loan Agreement, within 5 days after the same become due and payable, will constitute an Event of Default. Other events that constitute Events of Default are as described in the Loan Agreement. Following an Event of Default, the amount of each Advance will, at the option of Payee, accrue interest from the date of Default at the Default Rate. In addition to any other remedies that Payee may have hereunder or under the Loan Agreement, any payment of interest that is not made within 10 days after the due date thereof, as provided herein, or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Note, will be subject to a Late Charge which will be due and payable contemporaneously with such payment of interest. Following an Event of Default, at Payee's option, in addition to Payee's remedies set forth in any other Loan Documents or as may be available to Payee at law or in equity, Payee may by written notice to Maker, declare this Note, all accrued and unpaid interest thereon, and all other amounts payable under the Loan Documents to be, and the same will thereupon become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Maker. Forbearance to exercise this right with respect to any failure or breach of Maker will not constitute a waiver of the right as to any subsequent failure or breach. This Note is secured by the Collateral, and subject to the terms, covenants and conditions of the Loan Documents. The terms, covenants and conditions of the Loan 3 of 5 4 Documents are by this reference incorporated into this Note. Advances under this Note will be governed by the terms, covenants, and conditions set forth in the Loan Documents. A default under any of the Loan Documents which is not cured within any applicable grace period as provided therein will constitute a default under this Note. Maker covenants and agrees to pay all and singular the costs, taxes, fees, and expenses of every kind and nature, including Agent's and/or Payee's reasonable attorneys' and paralegals' fees and costs (including those incurred on appeal or in bankruptcy proceedings), documentary stamp taxes, intangible taxes and other excise taxes, and the cost of title evidence, incurred or expended at any time by Payee in the collection of the loan evidenced hereby and/or foreclosure of the Loan Documents or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing Agent's and/or Payee's rights under this Note, the Loan Documents or under any other instrument evidencing or securing the indebtedness evidenced hereby, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind. Maker, including any guarantor or endorser, for themselves, their heirs, legal representatives, successors, and assigns, respectively, hereby expressly waive presentment, demand for payment, notice of dishonor, protest, notice of non-payment, and diligence in collection, and consent that the time of all payments or any part thereof may be extended, rearranged, renewed or postponed by Payee, and further consent that the Collateral or any part thereof may be released, exchanged, or substituted by Payee, without in anyway modifying, altering, releasing, affecting, or limiting their respective liability or the lien of any security instrument, and agree that Payee will not be required first to institute any suit, or to exhaust any of its remedies against Maker or any other person or party liable hereunder, in order to enforce payment of this Note. This Note is to be construed and enforced according to the laws of the State of North Carolina and the laws and regulations of the United States of America. All agreements between Maker and Payee are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of maturity of the unpaid principal balance hereof, or otherwise, will the amount paid or agreed to be paid to Payee for the use, forbearance, or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto. If, from any circumstances whatsoever, fulfillment of any provision of this Note or the Loan Documents securing this Note, or by any other agreement referred to therein, at the time performance of such provision will be due, will involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable thereto, then ipso facto, the obligation to be fulfilled will be reduced to the maximum limit of such validity, and if for any circumstances whatsoever Payee will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be 4 of 5 5 applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest or if such excessive interest exceeds such principal balance, refunded to Maker. At all times thereafter the rate of interest in effect under this Note will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Note and the Loan Agreement. The provisions of this paragraph will control every other provision of all agreements between Maker and Payee. MAKER AND PAYEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MAKER NOR PAYEE, NOR ANY ENDORSER, ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK (AND HEREBY WAIVES ANY RIGHT TO) A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS NOTE, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MAKER AND PAYEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MAKER AND PAYEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE TO MAKER, AND WILL BE SUBJECT TO NO EXCEPTIONS. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ------------------------------------- ----------------------------- Unofficial Witness Name: G. Danny Edwards --------------------------- Title: Treasurer -------------------------- /s/ Dee Price - ------------------------------------- Notary Public Attest: /s/ W. Lawrence Jenkins ------------------------- Name: W. Lawrence Jenkins --------------------------- Title: Corporate Secretary -------------------------- My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 5 of 5 EX-10.(K)(2)(B) 4 SUBSITUTION REVOLVING PROMISSORY NOTE 1 EXHIBIT 10(k)(2)(b) SUBSTITUTION REVOLVING PROMISSORY NOTE $35,000,000.00 St. Marys, Georgia December 30, 1998 FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of AMSOUTH BANK, a state banking corporation ("Payee"), which term will include any subsequent holder hereof, at the offices of First Union National Bank ("Agent") located at 301 South College Street, Charlotte, North Carolina 28288, or at such other place as Agent may designate in writing from time to time, in legal tender of the United States of America, the principal sum of THIRTY-FIVE MILLION AND NO/100 DOLLARS ($35,000,000.00) or so much thereof as may be outstanding from time to time as Advances (the "Principal Amount") pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated December 30, 1998 between Maker, as borrower, and Agent, as Agent for the Lenders (the "Loan Agreement"), and all applicable fees, charges, costs and expenses, together with interest on each Advance at the applicable rate(s) of interest as provided below. The Loan Agreement by this reference is hereby incorporated into this Note to the same extent as if fully set forth herein. Capitalized terms not otherwise defined in this Note will have the meanings assigned to such terms in the Loan Agreement. Interest on each Advance outstanding under this Note from time to time will accrue, at Maker's election, at a LIBOR Interest Rate or the Base Rate (as defined below), subject to the terms, covenants and conditions of the Loan Agreement. Absent an Event of Default, the rate of interest charged on each LIBOR Advance will remain constant during the Interest Period elected for such LIBOR Advance, but will be adjusted based on any change in the LIBOR Interest Rate for any subsequent Interest Period applicable to such LIBOR Advance, and the rate of interest charged on each Base Rate Advance will be adjusted on a daily basis upon any changes in the Base Rate. For purposes of the foregoing, the following terms will have the meanings assigned to such terms as set forth below: (a) "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Maker) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by Agent from another recognized source or interbank quotation) in an amount - -------- NOTE: THIS SUBSTITUTION REVOLVING PROMISSORY NOTE SUBSTITUTES AND REPLACES THAT CERTAIN REVOLVING PROMISSORY NOTE FROM MAKER TO PAYEE DATED DECEMBER 29, 1997. 1 of 5 2 approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. (b) "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Maker) plus the applicable margin based upon the Maker's leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) under the Loan Agreement ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. (c) "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of First Union National Bank) published or announced by First Union National Bank from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. All accrued but unpaid interest on the Principal Amount will be due and payable monthly, commencing on January 10, 1999, and continuing on the 10th day of each successive calendar month until this Note is fully paid. If not sooner paid in full, the entire Principal Amount, together with all accrued and unpaid interest, and any and all fees, costs, and expenses hereunder, will be due and payable on December 30, 2001 (the "Maturity Date"). Subject to the terms, covenants and conditions of the Loan Agreement and this Note, the Principal Amount may be repaid and reborrowed from time to time upon Maker's request; provided, however, that Payee will have no obligation to make any Advances if a Default or Event of Default exists. TIME IS OF THE ESSENCE of this Note. THE LOAN EVIDENCED BY THIS NOTE IS PAYABLE IN FULL ON THE MATURITY DATE. MAKER MUST REPAY THE ENTIRE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE AND UNPAID INTEREST THEN DUE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. 2 of 5 3 Unless Maker prior to or contemporaneously with the repayment or prepayment of all or any portion of the Principal Amount designates in writing to Payee the Advance that should be credited with such repayment or prepayment, such repayment or prepayment will be applied by Payee to Advances on a first-borrowed, first-repaid basis. Absent an Event of Default, any payments received for application to any Advance, or as applied by Payee to any Advance, as provided above, will be applied to the principal balance of such Advance; provided, however, that if an Event of Default then exists, Payee may apply such repayment or prepayment first to late charges and fees, then to interest to the extent accrued, and then to the principal balance of such Advance, or in such other manner as Payee may elect. Repayments and prepayments of any Advances accruing interest at a LIBOR Interest Rate may be subject to a charge pursuant to Section 2.5 of the Loan Agreement. Repayments and prepayments of any Advances accruing interest at the Base Rate may be made without premium or penalty. Prepayment in part will not affect, vary or postpone the duty of Maker to pay all obligations when due, and it will not affect or impair the right of Payee to pursue all remedies available to it hereunder or under the other Loan Documents. Maker's failure to make any payment of principal under this Note on or before the same becomes due and payable on maturity hereof, or Maker's failure to make any payment of interest under this Note, or any fees, costs or expenses due hereunder or under the Loan Agreement, within 5 days after the same become due and payable, will constitute an Event of Default. Other events that constitute Events of Default are as described in the Loan Agreement. Following an Event of Default, the amount of each Advance will, at the option of Payee, accrue interest from the date of Default at the Default Rate. In addition to any other remedies that Payee may have hereunder or under the Loan Agreement, any payment of interest that is not made within 10 days after the due date thereof, as provided herein, or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Note, will be subject to a Late Charge which will be due and payable contemporaneously with such payment of interest. Following an Event of Default, at Payee's option, in addition to Payee's remedies set forth in any other Loan Documents or as may be available to Payee at law or in equity, Payee may by written notice to Maker, declare this Note, all accrued and unpaid interest thereon, and all other amounts payable under the Loan Documents to be, and the same will thereupon become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Maker. Forbearance to exercise this right with respect to any failure or breach of Maker will not constitute a waiver of the right as to any subsequent failure or breach. This Note is secured by the Collateral, and subject to the terms, covenants and conditions of the Loan Documents. The terms, covenants and conditions of the Loan Documents are by this reference incorporated into this Note. Advances under this Note will be governed by the terms, covenants, and conditions set forth in the Loan Documents. 3 of 5 4 A default under any of the Loan Documents which is not cured within any applicable grace period as provided therein will constitute a default under this Note. Maker covenants and agrees to pay all and singular the costs, taxes, fees, and expenses of every kind and nature, including Agent's and/or Payee's reasonable attorneys' and paralegals' fees and costs (including those incurred on appeal or in bankruptcy proceedings), documentary stamp taxes, intangible taxes and other excise taxes, and the cost of title evidence, incurred or expended at any time by Payee in the collection of the loan evidenced hereby and/or foreclosure of the Loan Documents or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing Agent's and/or Payee's rights under this Note, the Loan Documents or under any other instrument evidencing or securing the indebtedness evidenced hereby, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind. Maker, including any guarantor or endorser, for themselves, their heirs, legal representatives, successors, and assigns, respectively, hereby expressly waive presentment, demand for payment, notice of dishonor, protest, notice of non-payment, and diligence in collection, and consent that the time of all payments or any part thereof may be extended, rearranged, renewed or postponed by Payee, and further consent that the Collateral or any part thereof may be released, exchanged, or substituted by Payee, without in anyway modifying, altering, releasing, affecting, or limiting their respective liability or the lien of any security instrument, and agree that Payee will not be required first to institute any suit, or to exhaust any of its remedies against Maker or any other person or party liable hereunder, in order to enforce payment of this Note. This Note is to be construed and enforced according to the laws of the State of North Carolina and the laws and regulations of the United States of America. All agreements between Maker and Payee are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of maturity of the unpaid principal balance hereof, or otherwise, will the amount paid or agreed to be paid to Payee for the use, forbearance, or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto. If, from any circumstances whatsoever, fulfillment of any provision of this Note or the Loan Documents securing this Note, or by any other agreement referred to therein, at the time performance of such provision will be due, will involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable thereto, then ipso facto, the obligation to be fulfilled will be reduced to the maximum limit of such validity, and if for any circumstances whatsoever Payee will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest or if such excessive interest exceeds such principal balance, refunded 4 of 5 5 to Maker. At all times thereafter the rate of interest in effect under this Note will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Note and the Loan Agreement. The provisions of this paragraph will control every other provision of all agreements between Maker and Payee. MAKER AND PAYEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MAKER NOR PAYEE, NOR ANY ENDORSER, ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK (AND HEREBY WAIVES ANY RIGHT TO) A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS NOTE, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MAKER AND PAYEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MAKER AND PAYEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE TO MAKER, AND WILL BE SUBJECT TO NO EXCEPTIONS. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ----------------------------------- ---------------------------- Unofficial Witness Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- /s/ Dee Price - ----------------------------------- Notary Public Attest: /s/ W. Lawrence Jenkins ----------------------- Name: W. Lawrence Jenkins ------------------------- Title: Corporate Secretary ------------------------- My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 5 of 5 EX-10.(K)(2)(C) 5 SUBSITUTION REVOLVING PROMISSORY NOTE 1 EXHIBIT 10(k)(2)(c) SUBSTITUTION REVOLVING PROMISSORY NOTE $35,000,000.00 St. Marys, Georgia December 30, 1998 FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of GUARANTY FEDERAL BANK, F.S.B., a federal savings bank ("Payee"), which term will include any subsequent holder hereof, at the offices of First Union National Bank ("Agent") located at 301 South College Street, Charlotte, North Carolina 28288, or at such other place as Agent may designate in writing from time to time, in legal tender of the United States of America, the principal sum of THIRTY-FIVE MILLION AND NO/100 DOLLARS ($35,000,000.00) or so much thereof as may be outstanding from time to time as Advances (the "Principal Amount") pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated December 30, 1998 between Maker, as borrower, and Agent, as Agent for the Lenders (the "Loan Agreement"), and all applicable fees, charges, costs and expenses, together with interest on each Advance at the applicable rate(s) of interest as provided below. The Loan Agreement by this reference is hereby incorporated into this Note to the same extent as if fully set forth herein. Capitalized terms not otherwise defined in this Note will have the meanings assigned to such terms in the Loan Agreement. Interest on each Advance outstanding under this Note from time to time will accrue, at Maker's election, at a LIBOR Interest Rate or the Base Rate (as defined below), subject to the terms, covenants and conditions of the Loan Agreement. Absent an Event of Default, the rate of interest charged on each LIBOR Advance will remain constant during the Interest Period elected for such LIBOR Advance, but will be adjusted based on any change in the LIBOR Interest Rate for any subsequent Interest Period applicable to such LIBOR Advance, and the rate of interest charged on each Base Rate Advance will be adjusted on a daily basis upon any changes in the Base Rate. For purposes of the foregoing, the following terms will have the meanings assigned to such terms as set forth below: (a) "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Maker) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by - -------- NOTE: THIS SUBSTITUTION REVOLVING PROMISSORY NOTE SUBSTITUTES AND REPLACES THAT CERTAIN REVOLVING PROMISSORY NOTE FROM MAKER TO PAYEE DATED DECEMBER 29, 1997. 1 of 5 2 Agent from another recognized source or interbank quotation) in an amount approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. (b) "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Maker) plus the applicable margin based upon the Maker's leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) under the Loan Agreement ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. (c) "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of First Union National Bank) published or announced by First Union National Bank from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. All accrued but unpaid interest on the Principal Amount will be due and payable monthly, commencing on January 10, 1999, and continuing on the 10th day of each successive calendar month until this Note is fully paid. If not sooner paid in full, the entire Principal Amount, together with all accrued and unpaid interest, and any and all fees, costs, and expenses hereunder, will be due and payable on December 30, 2001 (the "Maturity Date"). Subject to the terms, covenants and conditions of the Loan Agreement and this Note, the Principal Amount may be repaid and reborrowed from time to time upon Maker's request; provided, however, that Payee will have no obligation to make any Advances if a Default or Event of Default exists. TIME IS OF THE ESSENCE of this Note. THE LOAN EVIDENCED BY THIS NOTE IS PAYABLE IN FULL ON THE MATURITY DATE. MAKER MUST REPAY THE ENTIRE OUTSTANDING PRINCIPAL 2 of 5 3 BALANCE OF THIS NOTE AND UNPAID INTEREST THEN DUE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. Unless Maker prior to or contemporaneously with the repayment or prepayment of all or any portion of the Principal Amount designates in writing to Payee the Advance that should be credited with such repayment or prepayment, such repayment or prepayment will be applied by Payee to Advances on a first-borrowed, first-repaid basis. Absent an Event of Default, any payments received for application to any Advance, or as applied by Payee to any Advance, as provided above, will be applied to the principal balance of such Advance; provided, however, that if an Event of Default then exists, Payee may apply such repayment or prepayment first to late charges and fees, then to interest to the extent accrued, and then to the principal balance of such Advance, or in such other manner as Payee may elect. Repayments and prepayments of any Advances accruing interest at a LIBOR Interest Rate may be subject to a charge pursuant to Section 2.5 of the Loan Agreement. Repayments and prepayments of any Advances accruing interest at the Base Rate may be made without premium or penalty. Prepayment in part will not affect, vary or postpone the duty of Maker to pay all obligations when due, and it will not affect or impair the right of Payee to pursue all remedies available to it hereunder or under the other Loan Documents. Maker's failure to make any payment of principal under this Note on or before the same becomes due and payable on maturity hereof, or Maker's failure to make any payment of interest under this Note, or any fees, costs or expenses due hereunder or under the Loan Agreement, within 5 days after the same become due and payable, will constitute an Event of Default. Other events that constitute Events of Default are as described in the Loan Agreement. Following an Event of Default, the amount of each Advance will, at the option of Payee, accrue interest from the date of Default at the Default Rate. In addition to any other remedies that Payee may have hereunder or under the Loan Agreement, any payment of interest that is not made within 10 days after the due date thereof, as provided herein, or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Note, will be subject to a Late Charge which will be due and payable contemporaneously with such payment of interest. Following an Event of Default, at Payee's option, in addition to Payee's remedies set forth in any other Loan Documents or as may be available to Payee at law or in equity, Payee may by written notice to Maker, declare this Note, all accrued and unpaid interest thereon, and all other amounts payable under the Loan Documents to be, and the same will thereupon become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Maker. Forbearance to exercise this right with respect to any failure or breach of Maker will not constitute a waiver of the right as to any subsequent failure or breach. This Note is secured by the Collateral, and subject to the terms, covenants and conditions of the Loan Documents. The terms, covenants and conditions of the Loan 3 of 5 4 Documents are by this reference incorporated into this Note. Advances under this Note will be governed by the terms, covenants, and conditions set forth in the Loan Documents. A default under any of the Loan Documents which is not cured within any applicable grace period as provided therein will constitute a default under this Note. Maker covenants and agrees to pay all and singular the costs, taxes, fees, and expenses of every kind and nature, including Agent's and/or Payee's reasonable attorneys' and paralegals' fees and costs (including those incurred on appeal or in bankruptcy proceedings), documentary stamp taxes, intangible taxes and other excise taxes, and the cost of title evidence, incurred or expended at any time by Payee in the collection of the loan evidenced hereby and/or foreclosure of the Loan Documents or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing Agent's and/or Payee's rights under this Note, the Loan Documents or under any other instrument evidencing or securing the indebtedness evidenced hereby, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind. Maker, including any guarantor or endorser, for themselves, their heirs, legal representatives, successors, and assigns, respectively, hereby expressly waive presentment, demand for payment, notice of dishonor, protest, notice of non-payment, and diligence in collection, and consent that the time of all payments or any part thereof may be extended, rearranged, renewed or postponed by Payee, and further consent that the Collateral or any part thereof may be released, exchanged, or substituted by Payee, without in anyway modifying, altering, releasing, affecting, or limiting their respective liability or the lien of any security instrument, and agree that Payee will not be required first to institute any suit, or to exhaust any of its remedies against Maker or any other person or party liable hereunder, in order to enforce payment of this Note. This Note is to be construed and enforced according to the laws of the State of North Carolina and the laws and regulations of the United States of America. All agreements between Maker and Payee are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of maturity of the unpaid principal balance hereof, or otherwise, will the amount paid or agreed to be paid to Payee for the use, forbearance, or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto. If, from any circumstances whatsoever, fulfillment of any provision of this Note or the Loan Documents securing this Note, or by any other agreement referred to therein, at the time performance of such provision will be due, will involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable thereto, then ipso facto, the obligation to be fulfilled will be reduced to the maximum limit of such validity, and if for any circumstances whatsoever Payee will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be 4 of 5 5 applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest or if such excessive interest exceeds such principal balance, refunded to Maker. At all times thereafter the rate of interest in effect under this Note will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Note and the Loan Agreement. The provisions of this paragraph will control every other provision of all agreements between Maker and Payee. MAKER AND PAYEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MAKER NOR PAYEE, NOR ANY ENDORSER, ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK (AND HEREBY WAIVES ANY RIGHT TO) A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS NOTE, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MAKER AND PAYEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MAKER AND PAYEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE TO MAKER, AND WILL BE SUBJECT TO NO EXCEPTIONS. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ----------------------------------- ---------------------------- Unofficial Witness Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- /s/ Dee Price - ----------------------------------- Notary Public Attest: /s/ W. Lawrence Jenkins ------------------------- Name: W. Lawrence Jenkins ------------------------- Title: Corporate Secretary ------------------------ My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 5 of 5 EX-10.(K)(2)(D) 6 THE REVOLVING PROMISSORY NOTE 1 EXHIBIT 10(K)(2)(D) REVOLVING PROMISSORY NOTE $20,000,000.00 St. Marys, Georgia December 30, 1998 FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of CITIZENS BANK OF RHODE ISLAND, a Rhode Island financial institution ("Payee"), which term will include any subsequent holder hereof, at the offices of First Union National Bank ("Agent") located at 301 South College Street, Charlotte, North Carolina 28288, or at such other place as Agent may designate in writing from time to time, in legal tender of the United States of America, the principal sum of TWENTY MILLION AND NO/100 DOLLARS ($20,000,000.00) or so much thereof as may be outstanding from time to time as Advances (the "Principal Amount") pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated December 30, 1998 between Maker, as borrower, and Agent, as Agent for the Lenders (the "Loan Agreement"), and all applicable fees, charges, costs and expenses, together with interest on each Advance at the applicable rate(s) of interest as provided below. The Loan Agreement by this reference is hereby incorporated into this Note to the same extent as if fully set forth herein. Capitalized terms not otherwise defined in this Note will have the meanings assigned to such terms in the Loan Agreement. Interest on each Advance outstanding under this Note from time to time will accrue, at Maker's election, at a LIBOR Interest Rate or the Base Rate (as defined below), subject to the terms, covenants and conditions of the Loan Agreement. Absent an Event of Default, the rate of interest charged on each LIBOR Advance will remain constant during the Interest Period elected for such LIBOR Advance, but will be adjusted based on any change in the LIBOR Interest Rate for any subsequent Interest Period applicable to such LIBOR Advance, and the rate of interest charged on each Base Rate Advance will be adjusted on a daily basis upon any changes in the Base Rate. For purposes of the foregoing, the following terms will have the meanings assigned to such terms as set forth below: (a) "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Maker) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by Agent from another recognized source or interbank quotation) in an amount approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. 1 of 5 2 (b) "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Maker) plus the applicable margin based upon the Maker's leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) under the Loan Agreement ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. (c) "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of First Union National Bank) published or announced by First Union National Bank from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. All accrued but unpaid interest on the Principal Amount will be due and payable monthly, commencing on January 10, 1999, and continuing on the 10th day of each successive calendar month until this Note is fully paid. If not sooner paid in full, the entire Principal Amount, together with all accrued and unpaid interest, and any and all fees, costs, and expenses hereunder, will be due and payable on December 30, 2001 (the "Maturity Date"). Subject to the terms, covenants and conditions of the Loan Agreement and this Note, the Principal Amount may be repaid and reborrowed from time to time upon Maker's request; provided, however, that Payee will have no obligation to make any Advances if a Default or Event of Default exists. TIME IS OF THE ESSENCE of this Note. THE LOAN EVIDENCED BY THIS NOTE IS PAYABLE IN FULL ON THE MATURITY DATE. MAKER MUST REPAY THE ENTIRE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE AND UNPAID INTEREST THEN DUE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. Unless Maker prior to or contemporaneously with the repayment or prepayment of all or any portion of the Principal Amount designates in writing to Payee the Advance that 2 of 5 3 should be credited with such repayment or prepayment, such repayment or prepayment will be applied by Payee to Advances on a first-borrowed, first-repaid basis. Absent an Event of Default, any payments received for application to any Advance, or as applied by Payee to any Advance, as provided above, will be applied to the principal balance of such Advance; provided, however, that if an Event of Default then exists, Payee may apply such repayment or prepayment first to late charges and fees, then to interest to the extent accrued, and then to the principal balance of such Advance, or in such other manner as Payee may elect. Repayments and prepayments of any Advances accruing interest at a LIBOR Interest Rate may be subject to a charge pursuant to Section 2.5 of the Loan Agreement. Repayments and prepayments of any Advances accruing interest at the Base Rate may be made without premium or penalty. Prepayment in part will not affect, vary or postpone the duty of Maker to pay all obligations when due, and it will not affect or impair the right of Payee to pursue all remedies available to it hereunder or under the other Loan Documents. Maker's failure to make any payment of principal under this Note on or before the same becomes due and payable on maturity hereof, or Maker's failure to make any payment of interest under this Note, or any fees, costs or expenses due hereunder or under the Loan Agreement, within 5 days after the same become due and payable, will constitute an Event of Default. Other events that constitute Events of Default are as described in the Loan Agreement. Following an Event of Default, the amount of each Advance will, at the option of Payee, accrue interest from the date of Default at the Default Rate. In addition to any other remedies that Payee may have hereunder or under the Loan Agreement, any payment of interest that is not made within 10 days after the due date thereof, as provided herein, or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Note, will be subject to a Late Charge which will be due and payable contemporaneously with such payment of interest. Following an Event of Default, at Payee's option, in addition to Payee's remedies set forth in any other Loan Documents or as may be available to Payee at law or in equity, Payee may by written notice to Maker, declare this Note, all accrued and unpaid interest thereon, and all other amounts payable under the Loan Documents to be, and the same will thereupon become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Maker. Forbearance to exercise this right with respect to any failure or breach of Maker will not constitute a waiver of the right as to any subsequent failure or breach. This Note is secured by the Collateral, and subject to the terms, covenants and conditions of the Loan Documents. The terms, covenants and conditions of the Loan Documents are by this reference incorporated into this Note. Advances under this Note will be governed by the terms, covenants, and conditions set forth in the Loan Documents. A default under any of the Loan Documents which is not cured within any applicable grace period as provided therein will constitute a default under this Note. 3 of 5 4 Maker covenants and agrees to pay all and singular the costs, taxes, fees, and expenses of every kind and nature, including Agent's and/or Payee's reasonable attorneys' and paralegals' fees and costs (including those incurred on appeal or in bankruptcy proceedings), documentary stamp taxes, intangible taxes and other excise taxes, and the cost of title evidence, incurred or expended at any time by Payee in the collection of the loan evidenced hereby and/or foreclosure of the Loan Documents or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing Agent's and/or Payee's rights under this Note, the Loan Documents or under any other instrument evidencing or securing the indebtedness evidenced hereby, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind. Maker, including any guarantor or endorser, for themselves, their heirs, legal representatives, successors, and assigns, respectively, hereby expressly waive presentment, demand for payment, notice of dishonor, protest, notice of non-payment, and diligence in collection, and consent that the time of all payments or any part thereof may be extended, rearranged, renewed or postponed by Payee, and further consent that the Collateral or any part thereof may be released, exchanged, or substituted by Payee, without in anyway modifying, altering, releasing, affecting, or limiting their respective liability or the lien of any security instrument, and agree that Payee will not be required first to institute any suit, or to exhaust any of its remedies against Maker or any other person or party liable hereunder, in order to enforce payment of this Note. This Note is to be construed and enforced according to the laws of the State of North Carolina and the laws and regulations of the United States of America. All agreements between Maker and Payee are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of maturity of the unpaid principal balance hereof, or otherwise, will the amount paid or agreed to be paid to Payee for the use, forbearance, or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto. If, from any circumstances whatsoever, fulfillment of any provision of the Loan Documents securing this Note, or by any other agreement referred to therein, at the time performance of such provision will be due, will involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable thereto, then ipso facto, the obligation to be fulfilled will be reduced to the maximum limit of such validity, and if for any circumstances whatsoever Payee will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest. At all times thereafter the rate of interest in effect under this Note will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Note and the Loan Agreement. The provisions of this paragraph will control every other provision of all agreements between Maker and Payee. 4 of 5 5 MAKER AND PAYEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MAKER NOR PAYEE, NOR ANY ENDORSER, ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK (AND HEREBY WAIVES ANY RIGHT TO) A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS NOTE, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MAKER AND PAYEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MAKER AND PAYEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE TO MAKER, AND WILL BE SUBJECT TO NO EXCEPTIONS. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By:/s/ G. Danny Edwards - ------------------ ---------------------------- Unofficial Witness Name: G. Danny Edwards -------------------------- Title: Treasurer -------------------------- /s/ Dee Price - ------------------ Notary Public Attest: /s/ W. Lawrence Jenkins ------------------------ Name: W. Lawrence Jenkins -------------------------- Title: Corporate Secretary ------------------------- My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 5 of 5 EX-10.(K)(2)(E) 7 REVOLVING PROMISSORY NOTE 1 EXHIBIT 10(k)(2)(e) REVOLVING PROMISSORY NOTE $15,000,000.00 St. Marys, Georgia December 30, 1998 FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of COMPASS BANK, an Alabama banking corporation ("Payee"), which term will include any subsequent holder hereof, at the offices of First Union National Bank ("Agent") located at 301 South College Street, Charlotte, North Carolina 28288, or at such other place as Agent may designate in writing from time to time, in legal tender of the United States of America, the principal sum of FIFTEEN MILLION AND NO/100 DOLLARS ($15,000,000.00) or so much thereof as may be outstanding from time to time as Advances (the "Principal Amount") pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated December 30, 1998 between Maker, as borrower, and Agent, as Agent for the Lenders (the "Loan Agreement"), and all applicable fees, charges, costs and expenses, together with interest on each Advance at the applicable rate(s) of interest as provided below. The Loan Agreement by this reference is hereby incorporated into this Note to the same extent as if fully set forth herein. Capitalized terms not otherwise defined in this Note will have the meanings assigned to such terms in the Loan Agreement. Interest on each Advance outstanding under this Note from time to time will accrue, at Maker's election, at a LIBOR Interest Rate or the Base Rate (as defined below), subject to the terms, covenants and conditions of the Loan Agreement. Absent an Event of Default, the rate of interest charged on each LIBOR Advance will remain constant during the Interest Period elected for such LIBOR Advance, but will be adjusted based on any change in the LIBOR Interest Rate for any subsequent Interest Period applicable to such LIBOR Advance, and the rate of interest charged on each Base Rate Advance will be adjusted on a daily basis upon any changes in the Base Rate. For purposes of the foregoing, the following terms will have the meanings assigned to such terms as set forth below: (a) "LIBOR" means the interest rate at which 30-day, 60-day, 90-day or 180-day deposits (as elected by Maker) in United States dollars are offered to prime banks in the London interbank market which appears on Reuters Screen FRBD as of 11:00 A.M. (London time), 2 Business Days before the Funding Date of any LIBOR Advance (or if not so reported, then as determined by Agent from another recognized source or interbank quotation) in an amount approximately equal or comparable to such LIBOR Advance with a maturity equal to such Interest Period, as adjusted for reserves by dividing that rate by 1.00 minus the Reserve Requirement, if any. (b) "LIBOR Interest Rate" means an annual rate of interest calculated on the basis of a 360 day year which is equivalent to LIBOR (as elected by Maker) 1 of 5 2 plus the applicable margin based upon the Maker's leverage based on the most recent quarter's Borrowing Compliance Certificate measured on a quarterly basis in accordance with Section 3.1(a)(vi) under the Loan Agreement ("Borrower's Leverage"). The applicable margins ("Applicable Margins") are as follows: (i) if Borrower's Leverage is equal to or less than .30:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.30% per annum; (ii) if Borrower's Leverage is greater than .30:1.00 and less than or equal to .45:1.00, the LIBOR Interest Rate shall equal LIBOR plus 1.45% per annum; and (iii) if Borrower's Leverage is greater than .45:1.00 and less than or equal to .55:1.00 the LIBOR Interest Rate shall equal LIBOR plus 1.60% per annum. (c) "Base Rate" means an annual rate of interest equivalent to the interest rate (but not necessarily the best or lowest rate charged borrowing customers of First Union National Bank) published or announced by First Union National Bank from time to time as its prime rate, calculated on the basis of a 365 (or 366, if applicable) day year. All accrued but unpaid interest on the Principal Amount will be due and payable monthly, commencing on January 10, 1999, and continuing on the 10th day of each successive calendar month until this Note is fully paid. If not sooner paid in full, the entire Principal Amount, together with all accrued and unpaid interest, and any and all fees, costs, and expenses hereunder, will be due and payable on December 30, 2001 (the "Maturity Date"). Subject to the terms, covenants and conditions of the Loan Agreement and this Note, the Principal Amount may be repaid and reborrowed from time to time upon Maker's request; provided, however, that Payee will have no obligation to make any Advances if a Default or Event of Default exists. TIME IS OF THE ESSENCE of this Note. THE LOAN EVIDENCED BY THIS NOTE IS PAYABLE IN FULL ON THE MATURITY DATE. MAKER MUST REPAY THE ENTIRE OUTSTANDING PRINCIPAL BALANCE OF THIS NOTE AND UNPAID INTEREST THEN DUE. PAYEE IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. Unless Maker prior to or contemporaneously with the repayment or prepayment of all or any portion of the Principal Amount designates in writing to Payee the Advance that should be credited with such repayment or prepayment, such repayment or prepayment will be applied by Payee to Advances on a first-borrowed, first-repaid basis. Absent an 2 of 5 3 Event of Default, any payments received for application to any Advance, or as applied by Payee to any Advance, as provided above, will be applied to the principal balance of such Advance; provided, however, that if an Event of Default then exists, Payee may apply such repayment or prepayment first to late charges and fees, then to interest to the extent accrued, and then to the principal balance of such Advance, or in such other manner as Payee may elect. Repayments and prepayments of any Advances accruing interest at a LIBOR Interest Rate may be subject to a charge pursuant to Section 2.5 of the Loan Agreement. Repayments and prepayments of any Advances accruing interest at the Base Rate may be made without premium or penalty. Prepayment in part will not affect, vary or postpone the duty of Maker to pay all obligations when due, and it will not affect or impair the right of Payee to pursue all remedies available to it hereunder or under the other Loan Documents. Maker's failure to make any payment of principal under this Note on or before the same becomes due and payable on maturity hereof, or Maker's failure to make any payment of interest under this Note, or any fees, costs or expenses due hereunder or under the Loan Agreement, within 5 days after the same become due and payable, will constitute an Event of Default. Other events that constitute Events of Default are as described in the Loan Agreement. Following an Event of Default, the amount of each Advance will, at the option of Payee, accrue interest from the date of Default at the Default Rate. In addition to any other remedies that Payee may have hereunder or under the Loan Agreement, any payment of interest that is not made within 10 days after the due date thereof, as provided herein, or such longer period as may be required under applicable laws of any State if the laws of such State are determined to govern this Note, will be subject to a Late Charge which will be due and payable contemporaneously with such payment of interest. Following an Event of Default, at Payee's option, in addition to Payee's remedies set forth in any other Loan Documents or as may be available to Payee at law or in equity, Payee may by written notice to Maker, declare this Note, all accrued and unpaid interest thereon, and all other amounts payable under the Loan Documents to be, and the same will thereupon become, immediately due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived by Maker. Forbearance to exercise this right with respect to any failure or breach of Maker will not constitute a waiver of the right as to any subsequent failure or breach. This Note is secured by the Collateral, and subject to the terms, covenants and conditions of the Loan Documents. The terms, covenants and conditions of the Loan Documents are by this reference incorporated into this Note. Advances under this Note will be governed by the terms, covenants, and conditions set forth in the Loan Documents. A default under any of the Loan Documents which is not cured within any applicable grace period as provided therein will constitute a default under this Note. Maker covenants and agrees to pay all and singular the costs, taxes, fees, and expenses of every kind and nature, including Agent's and/or Payee's reasonable attorneys' 3 of 5 4 and paralegals' fees and costs (including those incurred on appeal or in bankruptcy proceedings), documentary stamp taxes, intangible taxes and other excise taxes, and the cost of title evidence, incurred or expended at any time by Payee in the collection of the loan evidenced hereby and/or foreclosure of the Loan Documents or otherwise incurred in protecting and preserving the lien of the Loan Documents or in enforcing Agent's and/or Payee's rights under this Note, the Loan Documents or under any other instrument evidencing or securing the indebtedness evidenced hereby, or in enforcing, sustaining, protecting, or defending the lien or priority of the Loan Documents against any and all persons, including, but not limited to, lien claimants or the exercise of the power of eminent domain or other governmental power of any kind. Maker, including any guarantor or endorser, for themselves, their heirs, legal representatives, successors, and assigns, respectively, hereby expressly waive presentment, demand for payment, notice of dishonor, protest, notice of non-payment, and diligence in collection, and consent that the time of all payments or any part thereof may be extended, rearranged, renewed or postponed by Payee, and further consent that the Collateral or any part thereof may be released, exchanged, or substituted by Payee, without in anyway modifying, altering, releasing, affecting, or limiting their respective liability or the lien of any security instrument, and agree that Payee will not be required first to institute any suit, or to exhaust any of its remedies against Maker or any other person or party liable hereunder, in order to enforce payment of this Note. This Note is to be construed and enforced according to the laws of the State of North Carolina and the laws and regulations of the United States of America. All agreements between Maker and Payee are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of maturity of the unpaid principal balance hereof, or otherwise, will the amount paid or agreed to be paid to Payee for the use, forbearance, or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto. If, from any circumstances whatsoever, fulfillment of any provision of the Loan Documents securing this Note, or by any other agreement referred to therein, at the time performance of such provision will be due, will involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable thereto, then ipso facto, the obligation to be fulfilled will be reduced to the maximum limit of such validity, and if for any circumstances whatsoever Payee will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be applied to the reduction of the principal balance remaining unpaid hereunder and not to the payment of interest. At all times thereafter the rate of interest in effect under this Note will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Note and the Loan Agreement. The provisions of this paragraph will control every other provision of all agreements between Maker and Payee. 4 of 5 5 MAKER AND PAYEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MAKER NOR PAYEE, NOR ANY ENDORSER, ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK (AND HEREBY WAIVES ANY RIGHT TO) A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS NOTE, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MAKER AND PAYEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MAKER AND PAYEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR PAYEE TO MAKE THE LOAN EVIDENCED BY THIS NOTE TO MAKER, AND WILL BE SUBJECT TO NO EXCEPTIONS. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ------------------------------------ ---------------------------- Unofficial Witness Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- /s/ Dee Price - ------------------------------------ Notary Public Attest: /s/ W. Lawrence Jenkins ------------------------ Name: W. Lawrence Jenkins -------------------------- Title: Corporate Secretary ------------------------- My Commission Expires:Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 5 of 5 EX-10.(K)(3)(A) 8 MORTGAGE, ASGN OF LEASES & RENTS, SECURITY AGMT 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(3)(a) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT FOR THE LENDERS 2 MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT (this "Mortgage"), dated as of December 30, 1998 from KOGER EQUITY, INC., a Florida corporation ("Mortgagor"), whose mailing address is 3986 Boulevard Center Drive, Suite 101, Jacksonville, Florida 32207 Attention J.C. Teagle, President, to FIRST UNION NATIONAL BANK, a national association, as Agent for the Lenders (the "Mortgagee") under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement (the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, the Mortgagee's mailing address is One First Union Center, 301 S. College Street, Attention: Real Estate Capital Markets Group, Charlotte, North Carolina 28202. Capitalized terms not otherwise defined herein are defined in Article I. W I T N E S S E T H : THIS MORTGAGE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Mortgagor and all Obligations heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other Obligations which this Mortgage by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to Mortgagee, and (2) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of Obligations secured hereby shall in no event exceed $49,500,000.00 (the "Obligations"); and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, and in consideration of the aforesaid, Mortgagor hereby mortgages, grants a security interest in, grants, bargains, sells, conveys and confirms unto Mortgagee, its successors and assigns, the following property and rights whether now owned or hereafter acquired by Mortgagor (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the ("Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; 1 3 (iv) All fixtures, machinery, equipment and other personal property of all types owned by Mortgagor now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including, but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Mortgagor's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Obligations; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Mortgagor, to appear in and defend any action or proceeding brought with respect to Mortgagor's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Mortgagee in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property and all parts, rights, members and appurtenances thereof, for the use, benefit and behoof of Mortgagee, IN FEE SIMPLE forever. PROVIDED ALWAYS and these presents are upon the express condition that if Mortgagor will pay to Mortgagee the Obligations from time to time evidenced and secured by the Notes and will promptly and fully perform, execute and complete each and every covenant, agreement, obligation, condition and stipulation contained in this Mortgage and the Notes, then this Mortgage and the estate hereby created will cease and be null and void and cancelled of record; otherwise the same will remain in full force and effect. MORTGAGOR, FOR ITSELF AND FOR ITS SUCCESSORS AND ASSIGNS, HEREBY WARRANTS, REPRESENTS, COVENANTS AND AGREES AS FOLLOWS: 2 4 ARTICLE I 1. Definitions. As used in this Mortgage, the following capitalized terms shall have the meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Paragraph 5 of this Mortgage. "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Mortgagor, Mortgagee or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. 3 5 "Land" shall mean those certain parcels of real property located in the County of Jefferson, State of Alabama, as more particularly described in Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Lenders" shall mean FUNB, GFB, AmSouth, Compass, and Citizens, and any other Lenders under the Credit Agreement from time to time. "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith between Mortgagor and Mortgagee. "Loan Documents" shall mean collectively, the Notes, the Loan Agreement, this Mortgage, and the Security Deeds, the Assignments of Leases, the Assignments of Contracts, the Indemnification Agreements, as such terms and documents are defined in the Loan Agreement, and any and all other loan documents executed in connection with the Loan. "Mortgagee" shall have the meaning assigned to such term in the introductory paragraph of this Mortgage. "Mortgage" shall mean this Mortgage, Assignment of Leases and Rents, and Security Agreement. "Mortgagor" shall have the meaning assigned to such term in the introductory paragraph of this Mortgage. "Notes" shall mean collectively, (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of FUNB in the principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of Compass in the original principal amount of $15,000,000. "Obligations" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. 4 6 "Other Mortgage" shall mean any Security Deed (as defined in the Loan Agreement) or mortgage, deed to secure debt, or deed of trust given by Mortgagor to or in favor of Mortgagee to secure the Obligations, other than this Mortgage. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Rents" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "State" shall mean the State of Alabama. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. ARTICLE II 2. Representatives and Warranties Regarding Mortgage. Mortgagor represents and warrants to Mortgagee as follows: (a) It will timely pay and perform the Obligations when due; (b) It has full power, authority and legal right to execute and deliver this Mortgage and to grant a mortgage of the Property; (c) It holds good and marketable fee simple title to the Property; (d) It has the legal right to convey and encumber the Property subject to the Permitted Encumbrances and, at its expense, will warrant to Mortgagee and will defend its title to the Property and the estate created by this Mortgage against all claims and demands, and will maintain and preserve such estate so long as the Obligations secured by this Mortgage remains outstanding, subject, however, to the Permitted Encumbrances; and 5 7 (e) This Mortgage constitutes a valid first mortgage of the Property, subject to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Mortgage and the estate created hereby shall terminate in accordance with Paragraph 14.6 hereof, Mortgagor shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Mortgage and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the estate created hereby and the rights of Mortgagee hereunder. Mortgagor shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance; (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end; (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the sale shall be contested in good faith and by appropriate proceedings by Mortgagor in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that Mortgagee is otherwise in compliance with the Loan Agreement. Upon the written request of Mortgagee from time to time, Mortgagor will furnish to Mortgagee official receipts or other satisfactory proof evidencing such payments. In addition, Mortgagor will pay all utility charges as required by the Loan Agreement. Mortgagor shall not be entitled to any credit on the Obligations, by reason of the payment of any Imposition or utility charges or any part thereof; (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Mortgagor in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvements and the Fixtures, or any part of either thereof; (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be 6 8 promptly delivered, to Mortgagee any certificates or evidence of such insurance as required under the Loan Agreement; (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Mortgagor shall give immediate written and oral notice thereof to Mortgagee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Mortgagee shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Mortgagor would be entitled thereto under the Loan Agreement, and Mortgagor hereby irrevocably assigns to Mortgagee all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Mortgagor will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Mortgagee. At the sole cost and expense of Mortgagor, Mortgagee may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Mortgagee in connection with, any claim or the claims payment process. Mortgagor will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Mortgagee shall be applied in accordance with the provisions of the Loan Agreement; and (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Mortgagee of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. (h) Corporate Existence. Preserve and keep in full force and effect its corporate existence, rights and franchises and privileges as a corporation under the laws of the State of Alabama and comply with all laws applicable to it, and do or cause to be done all things necessary to preserve and to keep in full force and effect its right to own property in the State of Alabama. (i) Inspection. Permit the Beneficiary or its authorized representatives to inspect the Property during usual business hours. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Mortgagee, Mortgagor will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Mortgagee therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Mortgage; (ii) the Permitted Encumbrances; (iii) easements, restrictions, liens, charges and 7 9 other encumbrances permitted by the Loan Agreement; (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement; and (v) liens arising out of or created by any statute, the discharge of which cannot order the terms of such statute at the particular time be effected by Mortgagor; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Mortgagor shall have the right to grant, without the prior consent of Mortgagee, any utility easement. ARTICLE V 5. Events of Default. Any of the following events (each a "Default") shall, following the passage of any grace or cure period as provided below, constitute an Event of Default ("Event of Default"): (a) Mortgagor shall fail to make any payment of principal under any of the Notes on or before the same becomes due and payable on maturity thereof; or Mortgagor shall fail to make any payment of interest under any of the Notes, or any fees, costs or expenses due hereunder or thereunder, within 5 days after the same becomes due and payable; (b) Any representation or warranty made by Mortgagor (or any of its officers) under or in connection with any Loan Document shall be or become incorrect or untrue, or shall prove to have been incorrect or misleading in any material respect when made; (c) Mortgagor shall fail to perform or observe any term, covenant or agreement (other than a covenant of payment) contained in any Loan Document on its part to be performed or observed, and such failure shall remain uncured for 10 days after written notice thereof shall have been given by Mortgagee to Mortgagor, or if such failure cannot by its nature be cured within 10 days after written notice thereof shall have been given by Mortgagor and shall fail to complete such cure within 60 days after Mortgagee's initial written notice of such failure; (d) An involuntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced against Mortgagor, and such case or proceeding shall not be dismissed in 60 days; or a court shall enter an order, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator, supervisor, rehabilitator (or similar official) of Mortgagor or for any substantial part of its property, or ordering the winding-up, supervision or liquidation of its affairs; (e) Mortgagor shall commence a voluntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case or proceeding under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator, supervisor, rehabilitator (or other similar official) of Mortgagor or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its 8 10 indebtedness generally as the same becomes due, or shall take any corporate action in furtherance of any of the foregoing; (f) A judgment or order for the payment of money in excess of $2,500,000 shall be rendered against Mortgagor and either (A) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (B) there shall be any period of 10 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; (g) A Default has occurred and is continuing beyond any applicable grace or cure period under any debt (other than the Loan) in excess of $2,500,000.00; (h) Any material provision of the Loan Documents relating to Mortgagee's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Mortgagor, or Mortgagor shall so state in writing; and (i) This Mortgage shall, as a result of Mortgagor's acts or omissions, for any reason, except to the extent permitted by the terms thereof, cease to create a valid and, upon filing of UCC-1 financing statement(s), UCC-2 Notice Filings, or UCC-3 continuation statements, as applicable, perfected first priority security interest in any of the Collateral purported to be covered, which can be so secured or perfected. ARTICLE VI 6. Remedies in Case of Event of Default. Upon the occurrence of Default, the following remedies are available, without limitation, to Mortgagee: (a) Mortgagee may exercise all of Mortgagee's remedies under this Mortgage or other Loan Documents including, without limitation, acceleration of maturity of all payments and Obligations which shall immediately become due and payable without demand or notice; (b) Mortgagee may take immediate possession of the Property or any part thereof (which Mortgagor agrees to surrender to Mortgagee) and manage, control or lease the same to such persons and at such rental as it may deem proper and collect and apply Rents as provided herein. The taking of possession shall not prevent concurrent or later proceedings for the foreclosure sale of the Property; (c) Mortgagee may apply to any court of competent jurisdiction for the appointment of a receiver for all purposes including, without limitation, to manage and operate the Property or any part thereof, and to apply the net Rents therefrom to the payment of any of the Obligations. In event of such application, Mortgagor consents to the appointment of a receiver, and agrees that a receiver may be appointed without notice to Mortgagor, without 9 11 regard to the adequacy of any security for the Obligations, and without regard to the solvency of Mortgagor or any other person, firm or corporation who or which may be liable for the payment of the Obligations; (d) All the remedies of a mortgagee and a secured party as provided by law and in equity including, without limitation, foreclosure upon this Mortgage and sale of the Property, or any part of the Property, at a public sale conducted according to applicable law (referred to as "Sale") and conduct additional Sales as may be required until all of the Property is sold or the Obligations are satisfied; (e) Mortgagee may sell the Property at public outcry to the highest bidder for cash in front of the Court House door in the county where said Property is located, either in person or by auctioneer, after having first given notice of the time, place and terms of sale by publication once a week for three (3) successive weeks prior to said sale in some newspaper published in said county, and, upon payment of the purchase money, Mortgagee or any person conducting the sale for Mortgagee is authorized to execute to the purchaser at said sale a deed to the premises so purchased. Mortgagee may bid at said sale and purchase said premises, or any part thereof, if the highest bidder therefor. At the foreclosure sale the Property may be offered for sale and sold as a whole without first offering it in any other manner or may be offered for sale and sold in any other manner Mortgagee may elect. (f) Mortgagee may bid at Sale and may accept, as successful bidder, credit of the bid amount against the Obligations as payment of any portion of the purchase price; (g) Mortgagee shall apply the proceeds of Sale, first to any fees or attorney fees permitted Mortgagee by law in connection with Sale, second to expenses of foreclosure, publication, and sale permitted Mortgagee by law in connection with Sale, third to the Obligations, and any remaining proceeds as required by law; (h) Mortgagee is authorized to foreclose this Mortgage subject to the rights of any tenants of the Property, and the failure to make any such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, a defense to any proceedings instituted by Mortgagee to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property; (i) Mortgagee shall have the power and authority to institute and maintain any suits and proceedings as Mortgagee may deem advisable (i) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Mortgage, (ii) to preserve or protect its interest in the Property, and (iii) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Mortgagee's interest; (j) If Mortgagee shall have proceeded to enforce any right or remedy under this Mortgage by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, then and in every such instance, Mortgagor and Mortgagee shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Mortgagee shall continue as if no such proceeding had occurred or had been taken; 10 12 (k) Upon Mortgagee's demand, Mortgagor will pay to Mortgagee the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Mortgagor shall fail to pay the same forthwith upon such demand, Mortgagee shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Mortgagee's agents, attorneys and other representatives. Mortgagee shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Mortgage, and the right of Mortgagee to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Mortgage, or the foreclosure of the estate created hereby; (l) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Mortgagee shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. Mortgagor hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Mortgagee and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the estate created hereby upon the Property or any part thereof or any lien, rights, powers or remedies of Mortgagee hereunder, but such lien, rights, powers and remedies of Mortgagee hereunder shall continue unimpaired as before; and (m) Mortgagee may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Mortgagor and all other Persons and any and all property therefrom, and Mortgagee may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Mortgagee shall be applied to pay the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Mortgagee and all other costs and expenses of entering a bond and taking possession of and holding the Property, and then in the manner provided in Article VII of this Mortgage. If an Event of Default shall 11 13 have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Mortgagee shall be applied in the manner specified in Article VII of this Mortgage. ARTICLE VII 7. Application of Proceeds. The proceeds of (a) of the operation and management of the Property; and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Mortgagee or in the pursuance of any remedies hereunder; Second: to any lien prior to the estate created hereby which Mortgagee may consider it necessary or desirable to discharge; Third: to any Obligations secured by this Mortgage and at the time due and payable (whether by acceleration or otherwise); Fourth: to Mortgagee for payment of the Notes outstanding; and Fifth: the balance, if any, to Mortgagor. ARTICLE VIII 8. Change in Method of Taxation. In the event of the passage, after the date of this Mortgage, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Mortgagee in the Property, this Mortgage or the Loan Agreement, Mortgagor shall, upon demand, bear and pay the full amount (or any partial amount) requested by Mortgagee, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE IX 9. Future Advances. This Mortgage is given to secure not only existing Obligations, but also future advances made within fifteen (15) years of the date of this Mortgage to the same extent as if such future advances are made on the date of the execution of this Mortgage. Mortgagor hereby agrees to pay all mortgage taxes owed on any future advances so secured hereby at the time any such future advance is made hereunder. Mortgagor shall not execute any document that impairs or otherwise impacts the priority of any future advances secured by this Mortgage. 12 14 ARTICLE X 10. Assignment of Leases and Rents. Mortgagor hereby grants, transfers and assigns to Mortgagee Mortgagor's entire right, title and interest in and to the Leases and Rents. This assignment of Leases and Rents by Mortgagor to Mortgagee is intended to operate as an absolute and immediate assignment of such Leases and Rents. 10.1. Mortgagor's Representations and Warranties Regarding Assignment of Leases and Rents. Mortgagor represents and warrants to Mortgagee as follows: (a) Mortgagor has good and lawful right, title and interest in and to the Leases, is entitled to receive the Rents from the Leases and from the Property, has full power and authority to assign the Leases as provided herein and to grant to and confer upon Mortgagee the powers, interests and authority set forth herein, and has not assigned the Leases or Rents to any other party; (b) Mortgagor has neither done any act nor omitted to do any act which might prevent Mortgagee from, or limit Mortgagee in, acting under any of the provisions of this assignment of Leases and Rents; (c) All Leases provide for Rent to be paid monthly, in advance, and Mortgagor has not accepted and will not accept payment of Rent for more than one (1) month in advance; provided, however, Mortgagor may accept payment of Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five (5%) percent of the Rent collected during the applicable month; and there are no agreements, understandings, or undertakings by Mortgagor providing for free or reduced Rent in the past or in the future except as provided in the Leases; (d) Except as disclosed to Mortgagee in writing, Mortgagor is not now in default, the nature of which could have a material adverse impact on the financial condition of Mortgagor or the value of the Property, under any provision of any of the Leases, and no tenant under any of the Leases has claimed or asserted any defense, offset, counter-claim, or abatement of rent, and that the Leases remain in full force and effect. Mortgagor further represents and warrants that it has no knowledge of any default by any tenant under any of the Leases that could materially adversely affect the value of the Property; (e) This Assignment of Leases and Rents, the Leases, the performance of each and every covenant of Mortgagor under the Leases, and the enforcement by Mortgagee of its rights hereunder does not conflict with, or will not conflict with, and does not constitute or will not constitute a breach or default, under any agreement, Mortgage or other instrument to which Mortgagor is a party, or so far as is known to Mortgagor, any law, ordinance, administrative regulation or court decree which is applicable to Mortgagor; and (f) No action has been brought or, so far as is known to Mortgagor, is threatened, which could interfere in any way with the right of Mortgagor to execute and 13 15 deliver this assignment of Leases and Rents, and to perform all of Mortgagor's obligations contained in this assignment of Leases and Rents and in the Leases; and (g) To Mortgagor's knowledge, the Leases are valid, enforceable and in full force and effect. 10.2. Mortgagor's Covenants Regarding Assignment of Leases and Rents. Mortgagor hereby covenants and agrees to and with Mortgagee as follows: (a) Mortgagor will notify Mortgagee in writing (but without any right of approval or denial on the part of Mortgagee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement); (b) Mortgagor hereby acknowledges that any and all Rents collected or received by Mortgagor after the occurrence of an Event of Default will be the property of Mortgagee, which if received and collected by Mortgagor, will be considered received and collected on Mortgagee's behalf and as Mortgagee's agent, and will be held by Mortgagor in trust for the benefit of Mortgagee, and Mortgagor will deliver all such sums to Mortgagee immediately upon Mortgagor's request therefor; (c) In accordance with sound business judgment, Mortgagor will use its reasonable best efforts, at its cost and expense, to observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Mortgagor or its agents under the Leases, and will use its best efforts, in accordance with sound business judgment, to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Mortgagor will not do or permit to be done anything to impair the security thereof, including without limitation the execution of any other assignment or Mortgagor's interest in the Leases or the Rents, without Mortgagee's prior written consent; (d) Mortgagor authorizes and directs each and every present and future tenant under the Leases to pay all Rent to Mortgagee upon receipt of written demand from Mortgagee to so pay the same, and upon paying the same, such tenants will be relieved from all liability to Mortgagor for such Rental in all respects. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Mortgagee of the remedies provided for by law or by this assignment of Leases and Rents, the tenant thereunder will, upon request of any person succeeding to the interest of Mortgagor as a result of such enforcement, automatically become the tenant of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month in advance; 14 16 (e) This Assignment of Leases and Rents will not obligate Mortgagee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Mortgagor under any Lease, or for the control, care, management, or repair of the Property; nor will it operate to make Mortgagee responsible or liable for any waste committed on the Property by the tenants or any other parties or for any dangerous or defective condition of the Property, or for any act or omission relating to the management, upkeep, repair, or control of the Property that results in loss or injury or death to any person. Mortgagee will not be liable for any loss sustained by Mortgagor resulting from Mortgagee's failure to lease the Property after default. Mortgagor will and does hereby indemnify and agree to hold harmless Mortgagee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this assignment of Leases and Rents and from any and all claims and demands whatsoever which may be asserted against Mortgagee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases except to the extent the same is caused by the negligence of Mortgagee. Should Mortgagee incur any such liability under the Leases or by reason of this assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorney and paralegal fees and costs, will be secured hereby and Mortgagor will reimburse Mortgagee therefor immediately upon demand and upon the failure of Mortgagor so to do, Mortgagee may, at this option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Mortgagor as an advance under the Notes; and (f) This assignment of Leases and Rents is made without prejudice to any of the rights and remedies possessed by Mortgagee under the Loan Agreement, and the right of Mortgagee to exercise its remedies under this assignment of Leases and Rents may be exercised by Mortgagee either prior to, simultaneously with, or subsequent to any action taken by it under the Loan Agreement. Each and every right, remedy and power granted to Mortgagee by this assignment of Leases and Rents will be cumulative and in addition to any other right, remedy and power given by the Loan Agreement now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this assignment of Leases and Rents, and no act done or omitted by Mortgagee pursuant to the powers and rights granted it hereunder, nor the failure of Mortgagee to avail itself of any of the rights and remedies under this assignment of Leases and Rents, will be construed or deemed to be a waiver of any of Mortgagee's rights and remedies under this assignment of Leases and Rents, nor will such exercise or omission to exercise of the power and rights granted Mortgagee hereunder be deemed to constitute a waiver of its rights and remedies under the Loan Agreement. 10.3. Mortgagee's Covenants Regarding Assignment of Leases and Rents. Mortgagee hereby covenants and agrees to and with Mortgagor as follows: (a) Although this assignment of Leases and Rents constitutes a present and absolute assignment of the Leases and the Rents, so long as there is no Event of Default on the part of Mortgagor, Mortgagee will not require that such Rents be paid directly to 15 17 Mortgagee, and Mortgagor will have a license to collect and use the Rents for subsequent application as provided above; and (b) Upon the payment and performance in full of Mortgagor's obligations under the Loan Agreement, as evidenced by the recording or filing of an instrument of satisfaction or termination of this Mortgage without the recording of another security instrument in favor of Mortgagee affecting the Property, this assignment of Leases and Rents will be deemed terminated and released of record by Mortgagee and thereupon will be null and void and of no further force or effect. 10.4. Further Assurances. At Mortgagee's request, Mortgagor will assign and transfer to Mortgagee any and all subsequent Leases upon all or any part of the Property and to execute and deliver at the request of Mortgagee all such further assurances and assignments in the Leases and the Rents as Mortgagee will require from time to time in its sole discretion. 10.5. Subordination, Nondisturbance and Attornment. The Leases are and at all times shall be subject and subordinate in all respects to this Mortgage, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of this Mortgage, to the full extent of all principal, interest and all other amounts secured hereby. Provided that a tenant is not in default under its Lease, Mortgagee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of this Mortgage, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided herein, or pursuant to the laws of the State of South Carolina. If requested by a tenant under any of the Leases or upon Mortgagee's request, Mortgagor shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Mortgagee) with such tenant whereby Mortgagee will agree to not disturb the tenant in its possession of the Property provided such tenant is not in default under its Lease and the tenant will agree to attorn to Mortgagee if Mortgagee takes possession of the Property. ARTICLE XI 11. Security Agreement. (a) This Mortgage is hereby made and declared to be a security agreement, encumbering each and every item of personal property included herein, in compliance with the provisions of the Uniform Commercial Code as enacted in the State. A financing statement or statements reciting this Mortgage to be a security agreement, affecting all of said personal property aforementioned, shall be executed by Mortgagor and Mortgagee and appropriately filed. The remedies for any violation of the covenants, terms and conditions of the security agreement herein contained shall be (i) as prescribed herein, or (ii) as prescribed by general law, or (iii) as prescribed by the specific statutory consequences now or hereafter enacted and specified in said Uniform Commercial Code, all at Mortgagee's sole election. Mortgagor and Mortgagee agree that the filing of such 16 18 financing statement(s) in the records normally having to do with personal property shall never be construed as in any way derogating from or impairing this declaration and hereby stated intention of Mortgagor and Mortgagee that everything used in connection with the production of income from the Property and/or adapted for use therein and/or which is described or reflected in this Mortgage, is, and at all times and for all purposes and in all proceedings both legal or equitable shall be, regarded as part of the Property irrespective of whether (i) any such item is physically attached to the improvements, (ii) serial numbers are used for the better identification of certain items capable of being thus identified in a recital contained herein, or (iii) any such item is referred to or reflected in any such financing statement(s) of the rights in and to (aa) the proceeds of any fire and/or hazard insurance policy, or (bb) any award in eminent domain proceeds for a taking or for loss of value, or (cc) Mortgagor's interest as lessor in any present or future lease or rights to income growing out of the use and/or occupancy of the Property, whether pursuant to lease or otherwise shall never be construed as in any way altering any of the rights of Mortgagee as determined by this instrument impugning the priority of Mortgagee's estate granted hereby or by any other recorded document, but such mention in such financing statement(s) is declared to be for the protection of Mortgagee in the event any court shall at any time hold with respect to the foregoing (aa), (bb) or (cc), that notice of Mortgagee's priority of interest to be effective against a particular class of persons, must be filed in the Uniform Commercial Code records. (b) Mortgagor warrants that (i) Mortgagor's (that is "Debtor's") name, identity or corporate structure and residence or principal place of business are as set forth in Exhibit C hereto; (ii) Mortgagor (that is, "Debtor") has been using or operating under said name, identity or corporate structure without change for the time period set forth in Exhibit C hereto; and (iii) the location of the collateral is upon the Property. Mortgagor covenants and agrees that Mortgagor will furnish Mortgagee with notice of any change in the matters addressed by clauses (i) or (iii) of this subparagraph (b) within thirty (30) days of the effective date of any such change and Mortgagor will promptly execute any financing statements or other instruments deemed necessary by Mortgagee to prevent any filed financing statement from becoming misleading or losing its perfected status. (c) The information contained in this subparagraph (c) is provided in order that this Mortgage shall comply with the requirements of the Uniform Commercial Code, as enacted in the State of Alabama, for instruments to be filed as financing statements. The names of the "Debtor" and the "Secured Party," the identity or corporate structure and residence or principal place of business of "Debtor," and the time period for which "Debtor" has been using or operating under said name and identity or corporate structure without change, are as set forth in Exhibit C attached hereto and by this reference made a part hereof; the mailing address of the "Secured Party" from which information concerning the security interest may be obtained, and the mailing address of "Debtor" are as set forth in Exhibit C attached hereto; and a statement indicating the types, or describing the items, of collateral are set forth hereinabove. 17 19 ARTICLE XII 12. Approval of Legal Description. Mortgagor has read and does hereby approve the legal description of the Land which is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Mortgagee and its attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XIII 13. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Mortgage and the Loan Agreement, the Loan Agreement shall control. ARTICLE XIV 14. Miscellaneous. The following miscellaneous provisions shall apply: 14.1. Each legal, equitable or contractual right, power or remedy of Mortgagee now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Mortgagee of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. 14.2. No failure by Mortgagee to insist upon the strict performance of any term hereof or to exercise of any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Mortgage or under the Loan Agreement during the continuance of any Default shall affect or alter this Mortgage which shall continue in full force and effect with respect to any other then existing or subsequent breach. 14.3. If Mortgagor shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the application grace period, if any, Mortgagee, without notice to or demand upon Mortgagor and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Mortgagor and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Mortgagee, may be necessary or appropriate therefor. All sums so paid by Mortgagee and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Obligations secured by this Mortgage and shall be paid by Mortgagor to Mortgagee on demand. 14.4. At any time and from time to time, Mortgagor will deliver to Mortgagee, promptly upon request, a certificate signed by a duly authorized officer of Mortgagor stating that, to the best of the signer's knowledge after making due inquiry, there is no Default 18 20 hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Mortgagor is taking or proposes to take with respect thereto. Mortgagor will also furnish promptly to Mortgagee, such information with respect to the Property and the Leases as may from time to time be requested. 14.5. Mortgagor, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Mortgagee from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Mortgage or intended so to be. 14.6. This Mortgage and the estate created hereby shall terminate after the payment in full of (a) all the Obligations and (b) all other sums secured hereby. Upon such termination and upon surrender of this Mortgage for cancellation, Mortgagee shall release the Property then subject to the estate created hereby to the Persons entitled thereto. The recitals in any satisfaction executed under this Mortgage of any matters of fact shall be conclusive proof of the truthfulness thereof. The Mortgagee in such release may be described as "the person or persons legally entitled thereto." Mortgagee, at Mortgagor's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the estate created hereby, and (b) any other security held by Mortgagee and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Mortgage. 14.7. This Mortgage shall be governed by and construed in accordance with the laws of the State. 14.8. All rights, power and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Mortgage shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. 14.9. This Mortgage may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and shall be binding upon Mortgagor, its successors and assigns, and all Persons claiming under or through Mortgagor or any such successor or assign, and shall inure to the benefit of and be enforceable by Mortgagee and its successors and assigns. 14.10. The headings in this Mortgage are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. 19 21 14.11. All agreements between Mortgagor and Mortgagee, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Mortgagee exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Mortgagee in excess of the maximum lawful amount, and if in any circumstance Mortgagee shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Mortgagor. All interest paid or agreed to be paid to Mortgagee shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Mortgagor and Mortgagee. 14.12. This Mortgage may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. ARTICLE XV 15. WAIVER OF MORTGAGOR'S RIGHTS. BY EXECUTION OF THIS MORTGAGE, MORTGAGOR EXPRESSLY (A) ACKNOWLEDGES THE RIGHT TO ACCELERATE THE OBLIGATIONS SECURED HEREBY; AND (B) ACKNOWLEDGES THAT MORTGAGOR HAS READ THIS MORTGAGE AND ANY AND ALL QUESTIONS REGARDING THE LEGAL EFFECT OF THIS MORTGAGE AND ITS PROVISIONS HAVE BEEN EXPLAINED FULLY TO MORTGAGOR AND MORTGAGOR HAS CONSULTED WITH COUNSEL OF MORTGAGOR'S CHOICE PRIOR TO EXECUTING THIS MORTGAGE. 16. WAIVER OF JURY TRIAL. MORTGAGOR AND MORTGAGEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MORTGAGOR NOR MORTGAGEE, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS MORTGAGE, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MORTGAGOR AND MORTGAGEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MORTGAGOR AND MORTGAGEE, ARE MADE KNOWINGLY, VOLUNTARILY AND 20 22 INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR MORTGAGEE TO MAKE THE LOAN TO MORTGAGOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 21 23 IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be executed, sealed, and attested by its proper officers thereunto duly authorized, as of the day and year first above written. WITNESSES: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long By: /s/ G. Danny Edwards (SEAL) - --------------------------------- ------------------------- Its: Treasurer ------------------------------- /s/ Alan C. Sheppard, Jr. - --------------------------------- STATE OF Georgia: -------- COUNTY OF Camden: ------- I, Dee Price, Notary Public in and for said County in said State or said state at large, hereby certify that G. Danny Edwards, whose name as the Treasurer President of KOGER EQUITY, INC., a Florida corporation, is signed to the foregoing instrument and who is personally known to me acknowledged before me on this day that, being informed of the contents of the said instrument, he, as such officer and with full authority, executed the same voluntarily for and as the act of said corporation on the day the same bears date. GIVEN under my hand and official seal of office, this 30th day of December, 1998. (NOTARIAL SEAL) /s/ Dee Price ---------------------------------------------------- Notary Public Print Name: Dee Price ----------------------------------------- My Commission Expires: Feb. 1, 1999 ------------------------------ Commission No. Notary Public, Camden County, Georgia ------------------------------------- 22 24 EXHIBIT A The Land 25 EXHIBIT B Permitted Encumbrances 26 EXHIBIT C DEBTOR NAME: Koger Equity, Inc. CORPORATE STRUCTURE: a Florida corporation PRINCIPAL PLACE OF BUSINESS: 3986 Boulevard Center Drive #101 Jacksonville, Florida 32207 TIME PERIOD USING NAME WITHOUT CHANGE June 21, 1988, to present SECURED PARTY NAME: First Union National Bank, as Agent for the Lenders PRINCIPAL PLACE OF BUSINESS: 301 South College Street Charlotte, North Carolina 28288 27
- -------------------------------------------------------------------------------------------------------------- Name Options Address - -------------------------------------------------------------------------------------------------------------- Michael F. Beale 20,000 4823 Riverbasin Drive South, Jacksonville, Florida 32207 - -------------------------------------------------------------------------------------------------------------- Robert N. Bridger 20,000 3675 Buckskin Trail West, Jacksonville, Florida 32277 - -------------------------------------------------------------------------------------------------------------- Bryan F. Howell 20,000 8257 Bay Tree Lane, Jacksonville, Florida 32256 - -------------------------------------------------------------------------------------------------------------- W. Lawrence Jenkins 20,000 55 Sea Marsh Road, Fernandina Beach, Florida 32034 - -------------------------------------------------------------------------------------------------------------- J. Velma Keen II 20,000 8121 Mar Del Plata East, Jacksonville, Florida 32256 - -------------------------------------------------------------------------------------------------------------- Kenneth D. Lund 20,000 1484 Mallard Lake Avenue, Jacksonville, Florida 32259 - -------------------------------------------------------------------------------------------------------------- James L. Stephens 20,000 4404 Richmond Park Court, Jacksonville, Florida 32224 - -------------------------------------------------------------------------------------------------------------- Thomas C. McGeachy 20,000 3926 W. Granada Street, Tampa, Florida 33629 - -------------------------------------------------------------------------------------------------------------- James W. Walker 20,000 9961 East Vineyard Lake Road, Jacksonville, Florida 32256 - -------------------------------------------------------------------------------------------------------------- Charles R. Diebel 6,500 217 San Juan Drive, Ponte Vedra Beach, Florida 32082 - -------------------------------------------------------------------------------------------------------------- James Patrick Ferris 6,500 13151 Queens Forest, San Antonio, Texas 78230 - -------------------------------------------------------------------------------------------------------------- William C. Stainback 6,500 8850 Glen Ferry Drive, Alpharetta, Georgia 30202 - -------------------------------------------------------------------------------------------------------------- J. Dudley Bates 6,000 808 Castile Drive, Altamonte Springs, Florida 32714 - -------------------------------------------------------------------------------------------------------------- R. Koger Burns 6,000 2320 Monaco Drive, Tallahassee, Florida 32308 - -------------------------------------------------------------------------------------------------------------- Charles R. Harrell 6,000 4796 Chesney Street, NW, Harrisburg, North Carolina 28075 - -------------------------------------------------------------------------------------------------------------- Russell B. Parmele, Jr. 6,000 8 Cranebridge Place, Greensboro, North Carolina 27407 - -------------------------------------------------------------------------------------------------------------- James J. Crews 5,500 4515 Brookwood Drive, Tampa, Florida 33629 - -------------------------------------------------------------------------------------------------------------- Rufus R. Hambright, Jr. 5,500 4 Barley Mill Drive, Greer, South Carolina 29651 - -------------------------------------------------------------------------------------------------------------- Morris Kent Ransdell 5,500 4304 West Freeport Street, Broken Arrow, Oklahoma 74012 - -------------------------------------------------------------------------------------------------------------- Anthony Lopes 5,000 2388 Willing Hurst, Germantown, Tennessee 38139 - -------------------------------------------------------------------------------------------------------------- Gary B. Robertson 5,000 1604 Cliffwood Drive, Austin, Texas 78733 - -------------------------------------------------------------------------------------------------------------- Steven P. Skidmore 5,000 327 Serrania, El Paso, Texas 79932 - -------------------------------------------------------------------------------------------------------------- David W. Foster 4,500 2590 Catawba Ridge Court, Orange Park, Florida 32065 - -------------------------------------------------------------------------------------------------------------- Robert J. Smith 4,500 2501 Roswell Avenue, #102, Charlotte, North Carolina 28209 - -------------------------------------------------------------------------------------------------------------- Todd M. Chessher 1,000 2600 Lake Austin Blvd., #5201, Austin, Texas 78703 - -------------------------------------------------------------------------------------------------------------- Victor A. Hughes, III 4,000 2284-B Dunwoody Crossing, Atlanta, Georgia 30338 - -------------------------------------------------------------------------------------------------------------- Hans J. Kaunath 4,000 4531 Hidden Oak Court, Orlando, Florida 32804 - -------------------------------------------------------------------------------------------------------------- Sandy Luick 4,000 618 Hunters Horn, Lilburn, Georgia 30247 - -------------------------------------------------------------------------------------------------------------- W. C. McLaughlin, Jr. 4,000 5902 Sloan Drive, San Antonio, Texas 78228 - -------------------------------------------------------------------------------------------------------------- J. Scott McMurrian 4,000 15206 Forest Dew Drive, San Antonio, Texas 78232 - -------------------------------------------------------------------------------------------------------------- Allen C. Phipps 4,000 1514 Liberty Drive, Greensboro, North Carolina 27408 - -------------------------------------------------------------------------------------------------------------- Tulio E. Remington 4,000 2946 East 26 Place, Tulsa, Oklahoma 74114 - -------------------------------------------------------------------------------------------------------------- Robert P. Rowland 2,000 6718 Callaghan Road, #203, San Antonio, Texas 78229 - -------------------------------------------------------------------------------------------------------------- John C. Sellers, III 2,000 P. O. Box 356, Williamston, South Carolina 29697 - -------------------------------------------------------------------------------------------------------------- Charles C. Smith, Jr. 4,000 4985 Arapahoe Avenue, Jacksonville, Florida 32210 - -------------------------------------------------------------------------------------------------------------- Willis L. Stephens, Jr. 4,000 950 Parliament Road, Maitland, Florida 32750 - -------------------------------------------------------------------------------------------------------------- Henry B. Dirks, III 2,000 2022 Encino Alto, San Antonio, Texas 78259 - -------------------------------------------------------------------------------------------------------------- Judith C. Healey 4,000 12243 97th Avenue, North, Seminole, Florida 33772 - -------------------------------------------------------------------------------------------------------------- David G. Hofstetter 4,000 510 Crepe Myrtle Court, Alpharetta, Georgia 30005 - -------------------------------------------------------------------------------------------------------------- John W. Krosnes 4,000 8637 Riverchase Drive, Germantown, Tennessee 38139 - -------------------------------------------------------------------------------------------------------------- Laura S. McLeod 4,000 601 S. 1st Street Unit 3G, Jacksonville Beach, Florida 32250 - -------------------------------------------------------------------------------------------------------------- Edgar S. Mincey 2,000 4594 Lower Lake Road, Thomasville, North Carolina 27360 - -------------------------------------------------------------------------------------------------------------- Mark N. Musgrave 4,000 1873 Everhart Drive, Orlando, Florida, 32806 - -------------------------------------------------------------------------------------------------------------- Samuel D. Reale 4,000 Rt. 3 Box 5730, Havana, Florida 32333 - -------------------------------------------------------------------------------------------------------------- Daniel P. Armstrong 5,000 2427 Wattle Tree Road, East, Jacksonville, Florida 32246- 9742 - -------------------------------------------------------------------------------------------------------------- Thomas L. Bacsik 5,000 5830 Spinaker Loop, Lady Lake, Florida 32159 - -------------------------------------------------------------------------------------------------------------- Pauline M. Bodin 5,000 2000 Farm Way, Middleburg, Florida 32068 - -------------------------------------------------------------------------------------------------------------- Philip J. Bruce 6,000 1433 Tree Split Lane, Neptune Beach, Florida 32266 - -------------------------------------------------------------------------------------------------------------- William R. Byrd 5,000 4435 Woodsong Loop East, Jacksonville, Florida 32225 - -------------------------------------------------------------------------------------------------------------- G. Danny Edwards 6,000 9908 Vineyard Lake Lane, Jacksonville, Florida 32256 - -------------------------------------------------------------------------------------------------------------- John D. Fish 6,000 1855 Elizabeth Place, Jacksonville, Florida 32205 - -------------------------------------------------------------------------------------------------------------- Wade L. Hampton 6,000 2909 Iroquois Avenue, Jacksonville, Florida 32210 - --------------------------------------------------------------------------------------------------------------
EX-10.(K)(3)(B) 9 MORTGAGE, ASGN OF LEASES & RENTS, SECURITY AGMT 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(3)(b) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ASSIGNMENT OF LEASES AND RENTS THIS ASSIGNMENT OF LEASES AND RENTS (this "Assignment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Assignee, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. R E C I T A L S: A. Assignor is the mortgagor under that certain Mortgage, Assignment of Leases and Rents and Security Agreement given by Assignor to Assignee dated of even date herewith and recorded or to be recorded in the public records of Jefferson County, Alabama (the "Mortgage"); securing the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes"), encumbering certain real property interests located in Jefferson County, Alabama, as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Assignment for the purposes set forth herein. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars 1 3 ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title and interest in, to and under any and all present and future leases of or in the Premises ("Leases") and any and all rents, revenues, issues and profits (including Assignor's interest in any security deposits relating thereto) arising out of or accruing from the Leases whether now or hereafter due ("Rents"), said Leases and Rents being deemed part of the security for the indebtedness herein mentioned and are encumbered, transferred and conveyed by this Assignment, and in furtherance thereof, does hereby covenant and agree with Assignee as follows: 1. Assignor will notify Assignee in writing (but without any right of approval or denial on the part of Assignee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement). 2. Assignor will, at its cost and expense, observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Assignor or its agents under the Leases, and will use its reasonable best efforts in the exercise of sound business judgment to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Assignor will not do or permit to be done anything to impair the security hereof, including without limitation the execution of any other assignment of Assignor's interest in the Leases or the Rents, without Assignee's prior written consent. 3. This Assignment is intended to operate as an absolute and immediate assignment of the Leases and the Rents; however, unless and until a default occurs under the Notes, the Loan Agreement, the Mortgage or this Assignment, Assignor will have a license to collect the Rents as and when the same become due and payable. Assignor hereby agrees that the respective tenants under the Leases, upon notice from Assignee of the occurrence of a default hereunder, will thereafter pay to Assignee the Rents due and to become due under the Leases without any obligation to determine whether or not such a default does in fact exist. Assignor, without written approval of Assignee, will not collect or accept Rent for more than one (1) month in advance; provided, however, Assignor may accept Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month. 4. Upon payment in full of the principal sum and interest, of the Notes, this Assignment shall become and be void and of no effect. Assignor hereby authorizes and directs the lessees named in said Leases or any other or future lessees or occupants of the Premises described therein or in the Mortgage upon receipt from the Assignee of written notice to the effect that Assignee is then the holder of the Notes and the Mortgage and that a default exists thereunder or under the Assignment, to pay over to the Assignee 2 4 all rents, income, profits and revenues hereby assigned and to continue so to do until otherwise notified by Assignee. 5. This Assignment of Leases and Rents as provided herein will not be deemed or construed to constitute Assignee as a mortgagee in possession of the Premises nor to obligate Assignee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Assignor under any Lease, or for the control, care, management, or repair of the Premises; nor will it operate to make Assignee, except in the event of Assignee's negligence, recklessness or wilful misconduct, responsible or liable for any waste committed on the Premises by the tenants or any other parties or for any dangerous or defective condition of the Premises, or for any act or omission relating to the management, upkeep, repair, or control of the Premises that results in loss or injury or death to any person. Except in the event of Assignee's negligence, recklessness or wilful misconduct, Assignee will not be liable for any loss sustained by Assignor resulting from Assignee's failure to lease the Premises after default or from any other act or omission of Assignee in managing the Premises after default. Assignor will and does hereby indemnify and agree to hold harmless Assignee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this Assignment of Leases (except as a result of Assignee's gross negligence or willful misconduct) and, to the extent that a claim is made against Assignee prior to the time Assignee takes possession of the Premises, from any and all claims and demands whatsoever which may be asserted against Assignee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases. Should Assignee incur any such liability under the Leases or by reason of this Assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Assignor will reimburse Assignee therefor immediately upon demand and upon the failure of Assignor so to do, Assignee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Assignor as an advance under the Notes and secured by this Assignment. 6. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Assignee of the remedies provided for by law or by the Notes, the Mortgage or this Assignment, the lessee thereunder will, upon request of any person succeeding to the interest of Assignor as a result of such enforcement, automatically become the lessee of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month or two (2) months in advance (as applicable in accordance with Paragraph 3 above). The Leases are and at all times shall be subject and subordinate in all respects to the Mortgage, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of the Mortgage, to the full extent of all principal, interest and all other amounts secured thereby. Provided that a tenant is not in default under its Lease, Assignee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, 3 5 notwithstanding foreclosure of the Mortgage, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided in the Mortgage, or pursuant to the laws of the State of Alabama. If requested by a tenant or Assignor under any of the Leases or upon Assignee's request, Assignor and Assignee shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Assignee) with such tenant whereby Assignee will agree to not disturb the tenant in its possession of the Premises provided such tenant is not in default under its Lease and the tenant will agree to attorn to Assignee if Assignee takes possession of the Premises. 7. Upon a default under the Notes, the Loan Agreement, the Mortgage or this Assignment, Assignee may at its option, without notice and without regard to the adequacy of the security for the obligations set forth in the Notes, either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Premises, to have, hold, manage, lease and operate the same on such terms and for such period of time as Assignee may deem proper, and either with or without taking possession of the Premises in its own name, demand and receive the Rents in the possession of Assignor at the time of Assignee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Assignee, and to apply such Rents to the payment of: (a) all reasonable expenses of managing the Premises, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Assignee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Assignee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Premises and protecting and preserving the same; or (b) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Assignee in its sole discretion may determine, any custom or use to the contrary notwithstanding. 8. This Assignment is made and accepted without prejudice to any of the rights and remedies possessed by Assignee under the remaining terms and conditions of the Notes, the Loan Agreement, or the Mortgage, and the right of Assignee to exercise its remedies under this Assignment may be exercised by Assignee either prior to, simultaneously with, or subsequent to any action taken by it under the remaining terms and conditions of the Notes, the Loan Agreement, or the Mortgage. Each and every right, remedy and power granted to Assignee by this Assignment will be cumulative and in addition to any other right, remedy and power given by the remaining terms and conditions of the Notes, the Loan Agreement, the Mortgage or this Assignment, or now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this Assignment, and no act done or omitted by Assignee pursuant to the powers and rights granted it hereunder, nor the failure of Assignee to avail itself of any of the rights and remedies under this Assignment, will be construed or deemed to be a waiver of any of Assignee's rights and remedies under this Assignment, nor will such exercise or omission to exercise of the powers and rights granted Assignee hereunder be deemed to constitute 4 6 a waiver of its rights and remedies under the remaining terms and conditions of the Notes, the Loan Agreement, or the Mortgage. 9. Assignee may take or release other security for the payment of the indebtedness under the Notes and the Mortgage, may release any party primarily or secondarily liable therefor, and may apply any other security held by it to the satisfaction of such indebtedness without prejudice to any of its rights under this Assignment. 10. The term "Lease" or "Leases" as used herein, means said Leases hereby assigned or any extension or renewal thereof, and any leases subsequently executed during the term of this Assignment covering the Premises or any part thereof. At Assignee's request, Assignor will assign and transfer to Assignee any and all subsequent leases upon all or any part of the Premises and to execute and deliver at the request of Assignee all such further assurances and assignments in the Premises as Assignee will require from time to time in its sole discretion. 11. This Assignment, together with the covenants and warranties therein contained, shall inure to the benefit of Assignee and any subsequent holder of the Notes and the Mortgage shall be binding upon Assignor, their successors, executors, personal representatives, and assigns, and any subsequent owner of the Premises. 12. This Assignment shall expire and terminate upon the payment in full of the Notes and any other Indebtedness secured by the Mortgage and any cancellation, satisfaction or release of the Mortgage shall constitute a cancellation, satisfaction, or release of this Assignment. In the event that a specific property is released from the lien of the Mortgage, then such property and the Leases relating to it shall, effective with the release, also be released from this Assignment. 13. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. 5 7 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 6 8 IN WITNESS WHEREOF, Assignor has executed this Assignment under seal the day and year first above written. Signed, sealed and delivered in ASSIGNOR: the presence of: KOGER EQUITY, INC., a Florida corporation /s/ Alan C. Sheppard, Jr. - -------------------------------- Print Name: Alan C. Shepard, Jr. By: /s/ G. Danny Edwards -------------------- -------------------------- Name: G. Danny Edwards -------------------------- /s/ Janice R. Long Title: Treasurer - -------------------------------- -------------------------- Print Name: Janice R. Long -------------------- [AFFIX CORPORATE SEAL] STATE OF Georgia: -------- COUNTY OF Camden: ------- I, Dee Price , a Notary Public in and for said County in said State or said state at large, hereby certify that G. Danny Edwards, whose name as the Treasurer of KOGER EQUITY, INC., a Florida corporation, is signed to the foregoing instrument and who is personally known to me acknowledged before me on this day that, being informed of the contents of the said instrument, he, as such officer and with full authority, executed the same voluntarily for and as the act of said corporation on the day the same bears date. GIVEN under my hand and official seal of office, this 30th day of December, 1998. (NOTARIAL SEAL) /s/ Dee Price ---------------------------------------------------- Notary Public Print Name: Dee Price ---------------------------------------- My Commission Expires: Feb. 1, 1999 ----------------------------- Commission No. Notary Public, Camden County, Georgia ------------------------------------- 7 9 EXHIBIT A LEGAL DESCRIPTION OF PREMISES 8 EX-10.(K)(3)(C) 10 ASSIGNMENTS OF CONTRACTS LICENSES AND PERMITS 1 EXHIBIT 10(k)(3)(c) ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - -------------------------------------------------------------------------------- ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS - -------------------------------------------------------------------------------- THIS ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS (this "Assignment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Lender"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. BACKGROUND. Borrower is indebted to Lender (the "Loan") pursuant to the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Compass in the original principal amount of $15,000,000 (the "Notes"), secured by and subject to, among other documents, that certain Mortgage, Assignment of Leases and Rents, and Security Agreement (the "Mortgage") encumbering real property and improvements now or hereafter located thereon located in Jefferson County, Alabama, and being more particularly described on attached Exhibit A, (the "Property"), and by a certain Second Amended and Restated Revolving Credit Loan Agreement (the "Loan Agreement") setting forth certain terms, covenants and conditions with respect to such indebtedness, all being dated as of even date herewith, given by Borrower to Lender, which Notes, 1 3 Mortgage and Loan Agreement, this Assignment, and other related loan documents, together with any modifications, extensions and amendments thereof, collectively are referred to herein as the "Loan Documents." In order to further secure the Obligations, as such term is defined in the Loan Agreement, Lender has requested, and Borrower has agreed to provide, this Assignment on the terms, covenants and conditions hereinafter set forth. Capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Agreement. ACCORDINGLY, for good and valuable consideration, and as an inducement to Lender to make the Loan to Borrower, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and for the purpose of further securing the observance and performance of the Obligations, Borrower and Lender hereby agree as follows: 1. Assignment of Contract Documents. Borrower hereby grants, transfers and assigns to Lender, its successors and assigns, all of Borrower's right, title and interest in and to those contracts, licenses, permits, agreements, approvals and other documents described on attached Exhibit B (hereinafter, together with any changes, extensions, revisions, modifications or guarantees of performance thereof, called the "Contract Documents") relating to the acquisition, development, ownership or use of the Property. Lender agrees that upon the payment and performance in full of all the Obligations, this assignment shall become null and be void and of no further force and effect. 2. Representations and Warranties. Borrower represents and warrants to Lender, its successors and assigns, as follows: (a) There is no assignment of any of Borrower's rights under any of the Contract Documents to any person or entity, other than Lender. (b) Borrower is not in default under any of the Contract Documents and knows of no default on the part of any other party to any of the Contract Documents. (c) Borrower has not done nor omitted to do any act so as to be estopped from exercising any of its rights under any of the Contract Documents. (d) Borrower is not prohibited under any agreement with any other person or under any judgment or decree from the execution and delivery of this assignment or the performance of each and every covenant of Borrower hereunder or in the Contract Documents, except as may be set forth in the Contract Documents. 2 4 (e) No action has been brought or threatened which would in any way prohibit or impair the execution and delivery of this assignment or the performance of each and every covenant of Borrower hereunder or in the Contract Documents. 3. Performance of Obligations under Contract Documents. Borrower will (i) fulfill, perform and observe each and every condition and covenant of Borrower contained in any of the Contract Documents; (ii) give prompt notice to Lender of any claim of default under any of the Contract Documents given to Borrower or given by Borrower, together with a complete copy or statement of any information submitted or referenced in support of such claim; (iii) at the sole cost and expense of Borrower and in the exercise of sound business judgment, enforce the performance and observance of each and every covenant and condition of the Contract Documents to be performed or observed by any other party to any of the Contract Documents; and (iv) appear in and defend any action growing out of or in any manner connected with any of the Contract Documents. 4. Modifications and Waivers of Contract Documents. Except in the ordinary course of business and in the exercise of sound business judgment, Borrower will not (i) modify the terms of the Contract Documents unless required so to do by the terms of the Contract Documents or by law; or (ii) waive, or release any person from the observance or performance of any obligation to be performed under the terms of the Contract Documents or liability on account of any warranty given by them, unless consented to by Lender in its reasonable discretion. 5. Rights Assigned. The rights assigned hereunder include all of Borrower's right and title (i) to modify the Contract Documents; (ii) to terminate the Contract Documents; and (iii) to waive, or release the performance or observance of any obligation or condition of the Contract Documents; provided, however, these rights shall not be exercised by Lender unless Borrower is in default hereunder or under the other Loan Documents. 6. Defaults. Borrower shall be in default under this Assignment upon the occurrence of any of the following events: (a) Should Borrower fail to perform or observe any covenant of Borrower contained in this Assignment, and the same is not cured within ten (10) days after notice of such default is provided by Lender to Borrower; (b) Should any representation or warranty of Borrower herein contained prove untrue or misleading in any material respect; or (c) Should Borrower fail to perform promptly any undertaking of Borrower set forth in any of the Contract Documents, and the same is not cured within ten (10) days after notice of such default is provided by Lender to Borrower. 3 5 A default of Borrower under this Assignment will constitute an Event of Default under the other Loan Documents. 7. Remedies. (a) Upon the occurrence of a default hereunder, or an Event of Default as defined in the Loan Agreement, Lender may exercise its remedies as provided in the Loan Agreement, and in addition to such remedies may take possession of all Contract Documents constituting plans and specifications, site plans, surveys and architectural or engineering drawings or sketches reasonably required by Lender in the exercise of its rights and remedies hereunder. Furthermore, should Borrower fail to perform or observe any covenant or comply with any condition contained in any of the Contract Documents and such failure would cause irreparable injury to the Property including, but not limited to, the revocation or expiration of any permit or license issued in connection with the use of the Property, then Lender, but without obligation to do so, without notice to or demand on Borrower, and without releasing Borrower from its obligations to do so, may perform such covenant or condition and, to the extent that Lender shall incur any costs or pay any monies in connection therewith, including any costs or expenses of litigation, such costs, expense or payment shall be included in the indebtedness secured hereby and by the Mortgage and shall bear interest from the payment of such costs, monies or expenses thereof at the then applicable rate set forth in the Notes for amounts advanced by Lender on behalf of Borrower. (b) Borrower hereby indemnifies and agrees to hold harmless Lender from and against any and all losses, costs, damages, fees and expenses whatsoever associated with the exercise of Lender's rights under this Assignment and shall release Lender from all liability whatsoever for the exercise of such rights and all actions taken pursuant thereto, not including any negligent actions of Lender. (c) The remedies herein provided shall be in addition to and not in substitution for the rights and remedies which would otherwise be vested in Lender in any of the other Loan Documents, all of which rights and remedies are specifically reserved by Lender. The failure to exercise any of the remedies herein provided shall not constitute a waiver thereof, nor shall the use of any of the remedies hereby provided prevent the subsequent or concurrent resort to any other remedy or remedies. It is intended that this clause shall be broadly construed so that all remedies herein provided for or otherwise available to Lender shall remain available to Lender until all sums due it by reason of this Assignment have been paid to it in full and all obligations incurred by it in connection with the construction or operation of the contemplated improvements on the Property have been fully discharged without loss or damage to Lender. 4 6 8. No Obligation of Lender. Lender shall not be obligated to perform or discharge any obligation of Borrower under any of the Contract Documents, and Borrower agrees to indemnify and hold Lender harmless against any and all liability, loss or damage which Lender may incur under any of the Contract Documents or under or by reason of this assignment and of and from all claims and demands whatsoever which may be asserted against it by reason of an act of Lender under any of the terms of this assignment or under the Contract Documents, provided that Lender does not provide such acts in a negligent manner. 9. Miscellaneous. This Assignment shall be binding upon Borrower, its successors and assigns, and shall inure to the benefit of Lender, its successors, successors in title and assigns. If any term of this Assignment or any application thereof will be invalid, illegal or unenforceable, the remainder of this Assignment and any other application of such term will not be affected thereby. This Assignment shall be governed by and construed in accordance with the laws of the State of Alabama. In the event of conflict between the terms and conditions of this Assignment and the terms and conditions of the Loan Documents, the terms and conditions of the Loan Documents will govern. 10. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, THE AGENT, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO BORROWER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 5 7 IN WITNESS WHEREOF, the undersigned have caused this Assignment to be executed by their authorized officers as of the day and year first above written. BORROWER: Signed, sealed, and delivered KOGER EQUITY, INC., in the presence of: a Florida corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ------------------------------ ---------------------------- Name: Janice R. Long Name: G. Danny Edwards ------------------------- ------------------------- Title: President ------------------------ /s/ JA Hoener - ------------------------------ Name: James A. Hoener LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan C. Sheppard, Jr. By: /s/ J. Andrew Hogshead - ------------------------------ ---------------------------- Name: Alan C. Sheppard, Jr. Name: J. Andrew Hogshead ------------------------- ------------------------- Title: Vice President ------------------------- /s/ Nancy Hoffmann - ------------------------------ Name: Nancy Hoffmann Schedule of Exhibits: Exhibit A Description of Property Exhibit B Description of Contract Documents 6 8 EXHIBIT A DESCRIPTION OF PROPERTY 9 EXHIBIT B DESCRIPTION OF CONTRACT DOCUMENTS (a) All contracts or agreements, now existing or hereafter executed, with general contractors, subcontractors, materialmen, suppliers and/or laborers in connection with or pertaining to the construction of buildings or any other improvements on the Property. (b) Any contracts or agreements for land surveyor services between Borrower and any surveyor which is entered into with respect to the surveys to be prepared for the Property; and all surveys, surveyor costs, and maps prepared by any surveyor in connection with the Property. (c) Any agreements for architectural/engineering services between Borrower and any architect/engineer which is entered into with respect to the construction of improvements on the Property, and all drawings, plans and specifications, and site plans prepared by any architect/engineer in connection with the construction of improvements on the Property. (d) All warranties and guaranties relating to improvements now or hereafter constructed or installed on the Property. (e) Any management agreement between Borrower and a project operation manager related to the Property. (f) Any development fee agreement between Borrower and a project development manager related to the Property. (g) Any and all permits, licenses or other authorizations and approvals in favor of or in the name of Borrower or running with title to the Property, now or hereafter existing or granted, with respect to the ownership, development, use and occupancy of the Property for its intended purpose, including without limitation, building and excavation permits, plat and subdivision approvals, certificates of occupancy or completion, permits for driveway connection and highway signalization, storm water management, water wells, water distribution systems, sewage collection systems, dredge and fill, environmental protection, historical or archaeological protection, and any other permit, license, or other authorization necessary or advisable to comply with any governmental requirements concerning the Property or its intended use, or to comply with any private agreement concerning such Property to which 10 Borrower is a party or under or in compliance with which Borrower is bound to perform. (h) Any and all utility service agreements wherein a utility company and/or a governmental utility service provider has agreed to provide utilities to the Property. (i) Any agreement to provide sewer effluent for irrigation of the Property. (j) All contracts, binders or other agreements between Borrower and a buyer of the Property for the purchase and sale of all or any part of the Property, including such contract binders or other agreements which may hereafter come into existence with respect to the Property. EX-10.(K)(3)(D) 11 ENVIRONMENTAL INDEMNIFICATION AGREEMENT 1 EXHIBIT 10(k)(3)(d) ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ENVIRONMENTAL INDEMNIFICATION AGREEMENT THIS ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Agreement") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("FUNB"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined) (FUNB and such Lenders are collectively referred to herein as the "Lenders"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group, which terms Borrower and Lenders, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. RECITALS: A. Borrower has obtained financing from Lenders pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan Agreement") and those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan"). B. Borrower's obligations under the Loan are secured in part by a Mortgage, Assignment of Leases and Rents and Security Agreement in favor of Lenders (the "Mortgage") encumbering real property located in Jefferson County, Alabama, and being more particularly described on attached Exhibit A (the "Property"). C. As a condition precedent to and as a material inducement for Lenders' agreement to provide the Loan to Borrower, Lenders have required Borrower to execute and deliver this Agreement, it being acknowledged and understood by Borrower that Lenders otherwise are not willing to make or provide the Loan. D. Borrower has obtained a Phase I Environmental Site Assessment dated February 18, 1998, prepared by Bhate Environmental Associates, Inc. and a Phase I Environmental Site Assessment dated December 4, 1998, prepared by Turner, Hart & Hickman, P.C., for the Property referenced therein (collectively, the "Environmental 1 3 Assessment"), and has delivered a copy of the same to Lenders. Lenders intend to rely on the Environmental Assessment in making the Loan. NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and as a material inducement to Lenders to make or provide the Loan to Borrower, Borrower hereby covenants and agrees with Lenders as follows: 1. Definitions. The following terms as used in this Agreement will have the meanings set forth below: (a) "Hazardous Substances" will mean any hazardous or toxic substances, materials or wastes, including without limitation any flammable explosives, radioactive materials, friable asbestos, kepone, polychlorinated biphenyls (PCB's), electrical transformers, batteries, paints, solvents, chemicals, petroleum products, or other man-made materials with hazardous, carcinogenic or toxic characteristics, and such other solid, semi-solid, liquid or gaseous substances which are radioactive, toxic, ignitable, corrosive, carcinogenic to human health, those substances, materials, and wastes listed in the United States Department of Transportation Table (49 CFR 972.101) or by the Environmental Protection Agency, as hazardous substances (40 CFR Part 302, and amendments thereto) provided all such substances, materials and wastes are or become regulated under applicable local, state or federal law relating to (i) petroleum, (ii) asbestos, (iii) PCB's, or (iv) materials designated as a "hazardous substance," "hazardous waste," "hazardous materials," "toxic substances," "contaminants," in each case under any applicable Environmental Laws. (b) "Environmental Laws" will mean any applicable present or future federal, state or local laws, ordinances, rules or regulations pertaining to Hazardous Substances, including without limitation the following statutes and regulations, as amended from time to time: (i) the Federal Clean Air Act, 42 U.S.C. Section 7401 et seq.; (ii) the Federal Clean Water Act, 33 U.S.C. Section 1151 et seq.; (iii) the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. ("RCRA"); (iv) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq. ("CERCLA") and the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499, 100 Stat. 1613 ("SARA"); (v) the Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; (vi) the National Environment Policy Act, 42 U.S.C. Section 1857 et seq.; (vii) The Toxic Substance Control Act of 1976, 15 U.S.C. Section 2601 et seq.; (viii) applicable regulations of the Environmental Protection Agency, 33 CFR and 40 CFR relating to hazardous substances; and (ix) and similar statutes, rules and regulations under the laws of the State of Alabama. (c) "Hazardous Condition" will mean the presence, discharge, disposal, storage or release of any Hazardous Substance, in violation of any Environmental Laws, on or in 2 4 the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or that migrates, flows, percolates, diffuses or in any way moves onto or into the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or from the Property into adjacent property. (d) "Claims" will mean, individually and collectively, any claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses (including reasonable attorneys' and paralegals' fees and costs, whether incurred in enforcing this Agreement, collecting any sums due hereunder, settlement negotiations, at trial or on appeal), reasonable consultant fees and reasonable expert fees, together with all other reasonable costs and expenses of any kind or nature, that arise directly from or in connection with the existence of a Hazardous Condition, whether occurring before, on or after the date of this Agreement or caused by any person or entity. Without limiting the generality of the foregoing definition, Claims specifically will include claims, whether by related or third parties, for personal injury or real or personal property damage, and capital, operating and maintenance costs incurred in connection with any Remedial Work. However, notwithstanding the foregoing, Claims will not be deemed to include claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses, that arise in connection with any Hazardous Condition that is determined by proper judicial or administrative procedure to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, foreclosure or deed in lieu of foreclosure, or which is caused by the actions of Lenders. (e) "Remedial Work" will mean any investigation or monitoring of site conditions, any clean-up, containment, remediation, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person due to the existence of a Hazardous Condition. 2. Compliance with Environmental Laws; Disclosure of Hazardous Conditions. Except as to those conditions (the "Existing Conditions") as specifically may be disclosed in the Environmental Assessment, Borrower hereby represents, warrants, covenants and agrees in all material respects to and with Lenders that all operations or activities upon, or any use or occupancy of the Property by Borrower, any tenant or other occupant, to the best of Borrower's knowledge, is presently and will at all times until Borrower's conveyance of the Property or foreclosure of Mortgage be in compliance with all Environmental Laws; that Borrower has not at any time engaged in or permitted, nor has any existing or previous tenant or occupant of the Property engaged in or permitted to the best of Borrower's knowledge the occurrence of any Hazardous Condition, except as specifically may be 3 5 disclosed in the Environmental Assessment; and that to the best of Borrower's knowledge, there does not now exist nor is there suspected to exist any Hazardous Condition on or about the Property, except as specifically may be disclosed in the Environmental Assessment. 3. Indemnification. Borrower hereby indemnifies and agrees to protect, defend and hold Lenders harmless, which for purposes of this paragraph will be deemed to include the directors, officers, shareholders, employees and agents of Lenders, from and against any Claims other than claims arising from Lenders' or such other included parties' gross negligence or willful misconduct, including, without limitation, any claims relating to an Existing Condition. In the event that Lenders suffer or incur any Claims, Borrower will pay to Lenders the total of all such Claims suffered or incurred by Lenders upon demand therefor by Lenders. 4. Remedial Work. In the event that any Remedial Work with respect to any Hazardous Conditions that could result in a Claim is required under any Environmental Laws by any judicial order, or by any governmental entity, or in order to comply with the terms, covenants and conditions of this Agreement or of any other agreements affecting the Property, Borrower will perform or cause to be performed the Remedial Work in compliance with such law, regulation, order or agreement. All Remedial Work will be performed by one or more contractors, selected by Borrower and under the supervision of a consulting environmental engineer selected by Borrower, and approved in advance by Lenders. All costs and expenses of Remedial Work will be paid by Borrower including without limitation the charges of such contractor(s) and the consulting environmental engineer, and Lenders' reasonable attorneys' and paralegals' fees and costs incurred in connection with monitoring or review of all Remedial Work. In the event that Borrower fails to timely commence, or cause to be commenced, or fails to diligently prosecute to completion, such Remedial Work, Lenders may, but will not be required or have any obligation to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith, will thereupon constitute Claims. All such Claims will be due and payable by Borrower upon demand therefor by Lenders. 5. Permitted Contests. Notwithstanding any provision of this Agreement to the contrary, provided that (i) no default has occurred and is continuing under the Loan Agreement, (ii) no Lenders nor any assignee of any Lenders' interest (including any person having a beneficial interest) in the Property, the Loan and the Loan Documents will be exposed or subjected to civil or criminal liability, and (iii) the lien and security interest of Lenders or any such assignee in the Property, the Loan, the Loan Documents, or the payment of any sums to be paid under the Loan Documents, is not jeopardized or in any way adversely affected, Borrower may contest or cause to be contested, by appropriate action, the application, interpretation or validity of any Environmental Laws or any agreement requiring any Remedial Work pursuant to a good faith dispute regarding such application, interpretation or validity of such Environmental Laws or agreement requiring 4 6 such Remedial Work. During the pendency of any such permitted contest, Borrower may delay performance of Remedial Work or compliance with the Environmental Laws or agreement requiring such Remedial Work, provided that (i) Borrower actually contests and prosecutes such contest by appropriate proceedings conducted in good faith and with due diligence to resolution, (ii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have given Lenders written notice that Borrower intends to contest or will contest or cause to be contested the same, and will have given such security or assurances as Lenders reasonably may request to ensure compliance with the legal requirements pertaining to the Remedial Work (and payment of all costs, expenses, interest and penalties in connection therewith) and to prevent any sale, forfeiture or loss of all or any part of the Property by reason of such noncompliance, delay or contest, and (iii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have taken such steps as may be necessary to prevent or mitigate any continuing occurrence of any existing or suspected Hazardous Condition giving rise to the contested Remedial Work requirement. Subject to the terms and conditions set forth above, during the pendency of any such permitted contest resulting in a delay of performance of any required Remedial Work, Lenders agree that it will not perform such Remedial Work requirement on behalf of Borrower. 6. Subrogation of Indemnity Rights. If Borrower fails to perform its obligations under paragraphs 3 and 4 above, Lenders will be subrogated to any rights Borrower may have under any indemnifications from any present, future or former owners, tenants or other occupants or users of the Property relating to the matters covered by this Agreement. 7. Assignment by Lenders. No consent by Borrower will be required for any assignment or reassignment of the rights of Lenders hereunder to one or more purchasers of the Loan, the Loan Documents or Lenders' interest in the Property under the Mortgage. 8. Merger, Consolidation or Sale of Assets. Subject to limitations regarding disposition of any interest or control in Borrower as may be set forth in the Loan Documents, in the event of a disposition involving Borrower or all or a substantial portion of the assets of Borrower to one or more persons or other entities or the merger or consolidation of Borrower with another entity, the surviving entity or transferee of assets, as the case may be, will (i) be formed and existing under the laws of a state, district or commonwealth of the United States of America, and (ii) deliver to Lenders an acknowledged instrument in recordable form assuming all obligations, covenants and responsibilities of Borrower under this Agreement. 9. Survival; Independent Obligations. Notwithstanding anything to the contrary contained in the Loan Agreement, the obligations of Borrower under this Agreement will survive (a) the consummation of the Loan transaction described above; (b) satisfaction of 5 7 all terms and conditions to be performed by or on behalf of Borrower under the Loan Agreement; (c) termination, in accordance with their respective terms, of the Loan transaction and the Loan Agreement; (d) any assumption of Borrower's obligations under the Loan Agreement by a successor to Borrower (whether or not Lenders approved such assumption and whether or not Borrower was released from liability under the Loan Agreement); (e) conveyance of title to all or any portion of the Property to any third party, and subsequent reconveyance of all or any portion of the Property by any such third party to subsequent transferees; and (f) conveyance of title to the Property to Lenders through power of sale, process of foreclosure, or by conveyance in lieu of foreclosure of the Mortgage; provided, however, that Borrower will not be liable for damages resulting from Hazardous Conditions which are determined either by a written agreement or stipulation between Borrower and Lenders or, if Borrower and Lenders are unable to agree or stipulate, a final judicial or administrative action (after all available appeals have been taken or waived) to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, power of sale, process of foreclosure, or deed in lieu of foreclosure; provided, however, that the obligations of Borrower under this Agreement will finally cease and terminate upon the final expiration of any applicable statute of limitation of actions as to any potential Claim. The obligations of Borrower under this Agreement are separate and distinct from the obligations of Borrower under the Loan Agreement. This Agreement may be enforced by Lenders without regard to any other rights and remedies Lenders may have against Borrower under the Loan Agreement and without regard to any limitations on Lenders' recourse as may be provided in the Loan Agreement; provided, however, that a default by Borrower under this Agreement will constitute a default under the Loan Agreement. Enforcement of this Agreement will not be deemed to constitute an action for recovery of Borrower's indebtedness under the Loan Agreement nor for recovery of a deficiency judgment against Borrower following exercise of Borrower's remedies under the Mortgage. Borrower expressly and specifically agrees that Lenders may bring and prosecute a separate action or actions against Borrower hereunder whether or not Lenders have brought an action against Borrower under the Loan Agreement. 10. Default Interest. Any Claims and other payments required to be paid by Borrower to Lenders under this Agreement which are not paid on demand therefor will thereupon be considered "Delinquent," and will result in and constitute a default hereunder. In addition to all other rights and remedies of Lenders against Borrower as provided herein, or under applicable law, Borrower will pay to Lenders, immediately upon demand therefor, Default Interest (as defined below) on any such payments which are or have become Delinquent. Default Interest will be paid by Borrower from the date such payment becomes Delinquent through and including the date of payment of such Delinquent sums. As used herein, "Default Interest" will be equal to the rate of interest charged for a payment default under the Loan Agreement, but in any event not to exceed the maximum rate of interest 6 8 permitted to be contracted for under Alabama law. Borrower expressly and specifically agrees that any Default Interest charged to Borrower hereunder will in no manner or respect constitute a penalty or interest under the Loan Agreement, with the express understanding that this Agreement and Borrower's obligations hereunder constitute separate obligations of Borrower independent of the Loan Agreement. 11. Administrative Agent for Lenders. The Lenders have appointed FUNB to act as administrative agent on behalf of all of the Lenders in connection with the Loan. Accordingly, FUNB shall be entitled to exercise the rights and remedies of the Lenders hereunder as agent for each of the Lenders. Any notice provided by FUNB to the Borrower shall be deemed provided to Borrower by each of the Lenders, and any notice from Borrower which states it is to FUNB as agent for the Lenders hereunder, shall be deemed to be given to each of the Lenders. 12. Miscellaneous. If there is more than one party executing this Agreement as an indemnitor, each such party agrees that (i) the obligations of Borrower hereunder are joint and several, (ii) a release of any one or more such parties or any limitation of this Agreement in favor of or for the benefit of one or more such parties will not in any way be deemed a release of or limitation in favor of or for the benefit of any other party, and (iii) a separate action hereunder may be brought and prosecuted against one or more such parties. If any term of this Agreement or any application thereof will be invalid, illegal or unenforceable, the remainder of this Agreement and any other application of such term will not be affected thereby. No delay or omission in exercising any right hereunder will operate as a waiver of such right or any other right. This Agreement will be binding upon, inure to the benefit of and be enforceable by Borrower and Lenders, and their respective successors and assigns. This Agreement will be governed and construed in accordance with the laws of the State of Alabama. The parties hereby stipulate that jurisdiction and venue for purposes of enforcement of this Agreement and adjudication of the respective rights and obligations of the parties shall be in the Alabama circuit court in the judicial circuit in which the Property is located. 13. Conflict. In the event of conflict between the terms and conditions hereunder and the terms and conditions of the Loan Agreement, the terms and conditions of the Loan Agreement will govern. 14. Waiver of Defenses. In any action, suit or proceeding relating to this Agreement, Borrower and Lenders waive the right to interpose a defense of laches, failure of consideration or mutuality of remedy. [Remainder of page left intentionally blank] 7 9 IN WITNESS WHEREOF, Borrower and Lenders have executed this Agreement as of the date first above written. BORROWER: Signed, sealed and delivered KOGER EQUITY, INC., a Florida in the presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ----------------------------------- ----------------------------- Witness Janice R. Long Name: G. Danny Edwards ---------------------------- Title: Treasurer --------------------------- /s/ J A Hoener - ---------------------------------- Witness James A. Hoener LENDER: Signed, sealed and delivered FIRST UNION NATIONAL BANK, a in the presence of: national association, as Agent /s/ Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead - ----------------------------------- ----------------------------- Witness Alan C. Sheppard, Jr. Name: /s/ J. Andrew Hogshead ---------------------------- Title: Vice President --------------------------- /s/ Nancy Hoffmann - ---------------------------------- Witnesses Nancy Hoffmann 8 10 EXHIBIT A DESCRIPTION OF PROPERTY EX-10.(K)(4)(A)(I) 12 SECOND AMEND & RESTATED DEED TO SECURE DEBT 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(4)(a)(i) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. Leboeuf, Lamb, Greene & Macrae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- SECOND AMENDED AND RESTATED DEED TO SECURE DEBT AND SPREADER, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT Dated as of December 30, 1998 State: Georgia Section: Township: Range: County: DeKalb Tax I.D.: - -------------------------------------------------------------------------------- NOTE TO TAX COMMISSIONER: THIS INSTRUMENT SECURES A NOTE CONTAINING A MATURITY DATE THREE (3) YEARS FROM THE DATE THEREOF AND, THEREFORE, SUCH NOTE IS A "SHORT-TERM NOTE SECURED BY REAL ESTATE" AS SUCH TERM IS DEFINED IN OFFICIAL CODE OF GEORGIA ANNOTATED SECTION 48-6-60. CONSEQUENTLY, NO INTANGIBLES TAX IS DUE UPON THE RECORDATION OF THIS INSTRUMENT. SEE OFFICIAL CODE OF GEORGIA ANNOTATED SECTION 48-6-61. 2 2 SECOND AMENDED AND RESTATED DEED TO SECURE DEBT AND SPREADER, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT THIS SECOND AMENDED AND RESTATED DEED TO SECURE DEBT AND SPREADER, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT (this "Indenture"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Grantor"), whose mailing address is 3986 Boulevard Center Drive, Suite 101, Jacksonville, Florida 32207 Attention: J.C. Teagle, President, to FIRST UNION NATIONAL BANK, a national association, as Agent ("Grantee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, Grantee's mailing address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. Capitalized terms not otherwise defined herein are defined in Article I. This Indenture amends and restates that certain Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement (the "Original Indenture") recorded in Official Records Book 9767, Page 002, of the Public Records of DeKalb County, Georgia, which Original Indenture was assigned to Grantee pursuant to that certain Assignment of Deed to Secure Debt and Related Loan Documents of even date herewith to be recorded in the Public Records of DeKalb County, Georgia (the "Assignment"). WITNESSETH: THIS INDENTURE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Grantor and all indebtedness heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other indebtedness which this Indenture by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to the Lenders, (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of indebtedness secured hereby, other than for advances made pursuant to Article XXII, Paragraph 22 hereof, shall in no event exceed $150,000,000.00 (the "Indebtedness") and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, and in consideration of the aforesaid Indebtedness, Grantor hereby irrevocably grants, bargains and sells, conveys, transfers, assigns, sets over, alienates, hypothecates and pledges to Grantee and its 3 3 successors and assigns in and to all of the following property and rights whether now owned or hereafter acquired by Grantor (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the "Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) all fixtures, machinery, equipment and other personal property of all types owned by Grantor now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Grantor's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Indebtedness; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Grantor, to appear in and defend any action or proceeding brought with respect to Grantor's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Grantee in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property and all parts, rights, members and appurtenances thereof, for the use, benefit and behoof of Grantee, IN FEE SIMPLE forever. 4 4 PROVIDED ALWAYS, this Indenture is intended to operate and is to be construed as a deed passing title to the Property to Grantee and is made under those provisions of the existing laws of the State of Georgia relating to deeds to secure debt, and not as a mortgage, and is given to secure the payment of the Indebtedness. Should the Indebtedness be paid according to the tenor and effect thereof when the same shall become due and payable, and should Grantor perform all covenants herein in a timely manner, then this Indenture shall be cancelled and surrendered by Grantee. IN FURTHERANCE OF THE FOREGOING GRANTS (INCLUDING GRANTS OF SECURITY INTERESTS), BARGAINS, SALES, ALIENATIONS, CONVEYANCES, CONFIRMATIONS, PLEDGES, TRANSFERS AND ASSIGNMENTS, AND TO PROTECT THE PROPERTY AND THE SECURITY GRANTED BY THIS INDENTURE, GRANTOR, FOR ITSELF AND FOR ITS SUCCESSORS AND ASSIGNS, HEREBY WARRANTS, REPRESENTS, COVENANTS AND AGREES AS FOLLOWS: ARTICLE I 1. Definitions. As used in this Indenture, the following capitalized terms have the respective meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Article V of this Indenture. "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in clause (iv) of the Granting Clause of this Indenture. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. 5 5 "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Grantee" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Grantor" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Grantor, Grantee or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in clause (ii) of the Granting Clause of this Indenture. "Indebtedness" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Indenture" shall mean this Second Amended and Restated Deed to Secure Debt and Spreader, Assignment of Leases and Rents, and Security Agreement. "Land" shall mean those certain parcels of real property located in the County of DeKalb, State of Georgia, as more particularly described on Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "Lenders" shall mean FUNB, AmSouth, GFB, Citizens, Compass, and any other Lenders from time to time under the Loan Agreement. "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 between Grantor and Grantee. "Loan Documents" shall mean this Indenture, the Loan Agreement, the Notes, the Security Deeds, the Lease Assignments, the Assignments of Contracts, the Indemnification 6 6 Agreement, and any other instrument, document, affidavits, or certificates given by Borrower to the Agent or any trustee for the benefit of the Lenders in support of, or evidencing or securing, the Loan. "Notes" shall mean collectively (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Compass in the original principal amount of $15,000,000. "Other Indenture" shall mean any mortgage, deed to secure debt, or deed of trust given by Grantor to or in favor of Grantee to secure the Indebtedness, other than this Indenture. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Rents" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "State" shall mean the State of Georgia. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. ARTICLE II 2. Representations and Warranties. Grantor represents and warrants to Grantee that (a) it has full power, authority and legal right to execute and deliver this 7 7 Indenture and to grant a first deed to secure debt of the Property, (b) it holds good and marketable fee simple title to the Land and good and marketable title to the balance of the Property, (c) this Indenture constitutes a valid first deed to secure debt of the Property, subject to the Permitted Encumbrances, and (d) the Leases are in full force and effect in accordance with their respective terms, have not been canceled or modified, and have not been assigned or encumbered except to Grantee pursuant to this Indenture and the Loan Agreement, and, to the best of Grantor's knowledge, no default exists under the Leases. Grantor, at its expense, will warrant to Grantee and will defend its title to the Property and the estate created by this Indenture against all claims and demands, and will maintain and preserve such estate so long as the Indebtedness secured by this Indenture remains outstanding, subject, however, to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Indenture and the estate created hereby shall terminate in accordance with Article XVII, Grantor shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Indenture and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the estate created hereby and the rights of Grantee hereunder. Grantor shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance. (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end. (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the same shall be contested in good faith and by appropriate proceedings by Grantor in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that Grantee is otherwise in compliance with the Loan Agreement. Upon the written request of Grantee from time to time, Grantor will furnish to Grantee official receipts or other satisfactory proof evidencing such payments. In addition, Grantor will pay all utility charges as required by the Loan Agreement. Grantor shall not be entitled to any credit on the Indebtedness, by reason of the payment of any Imposition or utility charges or any part thereof. (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by 8 8 appropriate proceedings by Grantor in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvements and the Fixtures, or any part of either thereof. (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Grantee any certificates or evidence of such insurance as required under the Loan Agreement. (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Grantor shall give immediate written and oral notice thereof to Grantee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Grantee shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Grantor would be entitled thereto under the Loan Agreement, and Grantor hereby irrevocably assigns to Grantee all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Grantor will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Grantee. At the sole cost and expense of Grantor, Grantee may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Grantee in connection with, any claim or the claims payment process. Grantor will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Grantee shall be applied in accordance with the provisions of the Loan Agreement. (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Grantee of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. (h) Corporate Existence. Preserve and keep in full force and effect its corporate existence, rights and franchises and privileges as a corporation under the laws of the State of Georgia and comply with all laws applicable to it, and do or cause to be done all things necessary to preserve and to keep in full force and effect its right to own property in the State of Georgia. (i) Inspection. Permit the Grantee or its authorized representatives to inspect the Property during usual business hours. 9 9 ARTICLE IV 4. Negative Covenants. Without the prior written consent of Grantee, Grantor will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Grantee therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Indenture, (ii) the Permitted Encumbrances, (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement, (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement, and (v) liens arising out of or created by any statute, the discharge of which cannot under the terms of such statute at the particular time be effected by Grantor; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Grantor shall have the right to grant, without the prior consent of Grantee, any utility easement. ARTICLE V 5. Events of Default. Any of the following events (each a "Default") shall, following the passage of any grace or cure period as provided below, constitute an Event of Default ("Event of Default"): (a) Grantor shall fail to make any payment of principal under any of the Notes on or before the same becomes due and payable on maturity thereof; or Grantor shall fail to make any payment of interest under any of the Notes, or any fees, costs or expenses due hereunder or thereunder, within 5 days after the same becomes due and payable. (b) Any representation or warranty made by Grantor (or any of its officers) under or in connection with any Loan Document shall be or become incorrect or untrue, or shall prove to have been incorrect or misleading in any material respect when made. (c) Grantor shall fail to perform or observe any term, covenant or agreement (other than a covenant of payment) contained in any Loan Document on its part to be performed or observed, and such failure shall remain uncured for 10 days after written notice thereof shall have been given by Grantee to Grantor, or if such failure cannot by its nature be cured within such 10 day period, Grantor shall fail to commence and diligently pursue such cure within 10 days after written notice thereof shall have been given by Grantee to Grantor and shall fail to complete such cure within 60 days after Grantee's initial written notice of such failure. (d) An involuntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced against Grantor, and such case or proceeding shall not be dismissed in 60 days; or a court shall enter a decree, or a court or regulatory authority having jurisdiction over Grantor shall enter an order, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, 10 10 conservator, supervisor, rehabilitator (or similar official) of Grantor or for any substantial part of its property, or ordering the winding-up, supervision or liquidation of its affairs. (e) Grantor shall commence a voluntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case or proceeding under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator, supervisor, rehabilitator (or other similar official) of Grantor or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its indebtedness generally as the same becomes due, or shall take any corporate action in furtherance of any of the foregoing. (f) A judgment or order for the payment of money in excess of $2,500,000 shall be rendered against Grantor and either (A) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (B) there shall be any period of 10 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. (g) A Default has occurred and is continuing beyond any applicable grace or cure period under any Debt (other than the Loan) in excess of $2,500,000. (h) Any material provision of the Loan Documents relating to Grantee's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Grantor, or Grantor shall so state in writing. (i) The Security Agreement shall, as a result of Grantor's acts or omissions, for any reason, except to the extent permitted by the terms thereof, cease to create a valid and, upon filing of UCC-1 financing statement(s), UCC-2 Notice Filings, or UCC-3 continuation statements, as applicable, perfected first priority security interest in any of the Collateral purported to be covered, which can be so secured or perfected. ARTICLE VI 6. Remedies in Case of Event of Default. 6.1. Legal Proceedings and Foreclosure. If an Event of Default shall have occurred, Grantee may proceed by suit or suits at law or in equity or by any other appropriate remedy to protect and enforce its rights hereunder, whether for the specific performance of any covenant or agreement contained herein, or for an injunction against the violation of any of the terms hereof, or in aid of the exercise of any right, power or remedy available to it, or to enforce the payment of the Indebtedness under the Loan Agreement, or to foreclose the estate created by this Indenture and the security interest of this Indenture as against all or any part of the Property and to have all or any part of the Property sold, in any manner permitted by law, under the judgment or decree of a court or 11 11 courts of competent jurisdiction, or otherwise, and to pursue any other remedy available to it. If Grantee proceeds to foreclose the estate created hereby, Grantee shall have the statutory power of sale if permitted by applicable law. In the event of any such suit or proceeding, Grantee shall comply with any local laws applicable to any such suits or proceedings. Any such suit or proceeding instituted by Grantee shall be brought in its name as Grantee and any recovery or judgement shall be for the benefit of Grantee. All costs and expenses (including, without limitation, reasonable attorney's fees and expenses) incurred by Grantee in connection with any such suit or proceeding, together with interest thereon (to the extent permitted by law) computed at the Default Rate from the date on which such costs or expenses are incurred to the date of payment thereof, shall constitute additional Indebtedness secured by this Indenture and shall be paid by Grantor to Grantee, as the case may be, on demand. 6.2. Power of Sale. Without in any way limiting the other provisions of this Indenture, but in addition thereto and in amplification thereof, upon the occurrence of any Event of Default, Grantee, at its option, may sell the Property or any part of the Property at one or more public sale or sales before the door of the courthouse of the county in which the Property or any part of the Property is situated, to the highest bidder for cash, in order to pay the Indebtedness, any and all expenses of sale and of all proceedings in connection therewith, including reasonable attorneys' fees, after advertising the time, place and terms of sale once a week for four (4) consecutive weeks (but without regard to the number of days) in a newspaper in which Sheriff's sales are advertised in said county. At any such public sale, Grantee may execute and deliver to the purchaser a conveyance of the Property or any part of the Property in fee simple, with full general warranties of title and to this end, Grantor hereby constitutes and appoints Grantee the agent and attorney-in-fact of Grantor to make any such sale and conveyance and thereby to divest Grantor of all right, title and equity that Grantor may have in and to the Property and to vest the same in the purchaser or purchasers at such sale or sales, and all the acts or doings of said agent and attorney-in-fact are hereby ratified and confirmed and any recitals in said conveyance or conveyances as to facts essential to a valid sale shall be binding upon Grantor. Grantee, its agents, representatives, successors or assigns may bid and purchase at any such sale. The aforesaid power of sale and agency hereby granted are coupled with an interest and are irrevocable by death or otherwise, are granted as cumulative of the other remedies provided hereby or by law for collection of the Indebtedness and shall not be exhausted by one exercise thereof but may be exercised until full payment of all of the Indebtedness. In the event of any sale under this Indenture by virtue of the exercise of the powers herein granted, pursuant to any order in any judicial proceeding or otherwise, the Property may be sold as an entirety or in separate parcels and in such manner or order as Grantee in its sole discretion may elect, and if Grantee so elects, Grantee may sell the personal property covered by this Indenture at one or more separate sales in any manner permitted by the Uniform Commercial Code of the State, and one or more exercises of the powers herein granted shall not extinguish nor exhaust such powers, until the entire Property is sold or the Indebtedness is paid in full. If the Indebtedness is now or hereafter further secured by any chattel mortgages, pledges, contracts of guaranty, assignments of lease or other security instruments, Grantee may, 12 12 at its option, exhaust the remedies granted under any of said security instruments either concurrently or independently, and in such order as Grantee may determine. 6.3. Acceleration of Maturity. If an Event of Default shall have occurred, Grantee may declare the entire outstanding Indebtedness under the Loan Agreement, and all other sums secured hereby, to be due and payable immediately, and upon such declaration, such Indebtedness and other sums shall immediately become and be due and payable without demand or notice. 6.4. Leases. Grantee is authorized to foreclose this Indenture subject to the rights of any tenants of the Property, and the failure to make any such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, nor be asserted by Grantor to be, a defense to any proceedings instituted by Grantee to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property. 6.5. Suits to Protect the Property. Grantee shall have the power and authority to institute and maintain any suits and proceedings as Grantee may deem advisable (a) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Indenture, (b) to preserve or protect its interest in the Property, and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Grantee's interest. 6.6. Discontinuance of Proceedings; Position of Parties Restored. If Grantee shall have proceeded to enforce any right or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, then and in every such instance, Grantor and Grantee shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Grantee shall continue as if no such proceeding had occurred or had been taken. 6.7. Grantor to Pay the Indebtedness on Any Default in Payment; Application of Monies by Grantee. (a) If an Event of Default shall occur as a result of Grantor's failure to pay any amount due under the Loan Agreement or this Indenture, then, upon Grantee's demand, Grantor will pay to Grantee the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Grantor shall fail to pay the same forthwith upon such demand, Grantee shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Grantee's agents, attorneys and other representatives. Grantee shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this 13 13 Indenture, and the right of Grantee to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Indenture, or the foreclosure of the estate created hereby. (b) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Grantee shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. (c) Grantor hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Grantee and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the estate created hereby upon the Property or any part thereof or any lien, rights, powers or remedies of Grantee hereunder, but such lien, rights, powers and remedies of Grantee hereunder shall continue unimpaired as before. ARTICLE VII 7.1. Purchase of the Property by Grantee. Upon any foreclosure sale, Grantee may bid for and purchase the Property, and, upon compliance with the terms of sale, may hold, retain and possess and dispose of such Property in its own absolute right without further accountability. 7.2. Application of Indebtedness Toward Purchase Price. If Grantee purchases the Property pursuant to foreclosure, power of sale or otherwise, then Grantee may, in lieu of cash, apply all or any portion of the sums due to Grantee under the Loan Agreement and this Indenture or any other instrument securing the Indebtedness, to the unpaid balance of the purchase price remaining after payment of any portion of the purchase price required to be paid in cash, and the costs and expenses of the sale, compensation and other charges relating to the sale. ARTICLE VIII 8. Waiver of Appraisement, Valuation, Etc. Grantor hereby waives, to the full extent it may lawfully do so, the benefit of all appraisement, valuation, stay, moratorium, exemption from execution, extension and redemption laws now or hereafter in force and all rights of marshaling in the event of the sale of the Property or any part thereof or any interest therein. ARTICLE IX 9. Appointment of Receiver. If an Event of Default shall have occurred, Grantee shall, as a matter of right, be entitled, ex parte and without notice, to the appointment of a receiver or receivers of the Property or any part thereof in accordance with Georgia 14 14 Official Code ss. 9-8-3 and without regard to the value of the Property as security for the Indebtedness, or the solvency or insolvency of any Person liable for the payment of the Indebtedness and without necessity or requirement for posting bond, whether such receivership be incidental to a proposed sale thereof or otherwise, and Grantor hereby consents to the appointment of such a receiver or receivers and will not oppose any such appointment. Any receiver which may be appointed pursuant to this paragraph, shall have the right, but not the obligation, to take possession, manage and operate the Property, together with such other powers conferred upon it by the appointing court. The expenses, including receiver's fees, attorney's fees, costs and agent's compensation, incurred pursuant to the powers herein contained shall be secured by this Indenture. ARTICLE X 10. Possession, Management and Income. If an Event of Default shall have occurred under this Indenture, Grantee, without further notice, may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Grantor and all other Persons and any and all property therefrom, and Grantee may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Grantee shall be applied (a) to pay (i) the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Grantee and all other costs and expenses of entering a bond and taking possession of and holding the Property, and (ii) any lien prior to the estate created hereby which Grantee may consider it necessary or desirable to discharge and then (b) in the manner provided in Article XI of this Indenture. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Grantee shall be applied in the manner specified in Article XI of this Indenture. ARTICLE XI 11. Application of Proceeds. The proceeds of (a) the operation and management of the Property pursuant to Article X of this Indenture, and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Grantee or in the pursuance of any remedies hereunder; 15 15 Second: to any lien prior to the estate created hereby which Grantee may consider it necessary or desirable to discharge; Third: to any Indebtedness secured by this Indenture and at the time due and payable (whether by acceleration or otherwise); Fourth: to Grantee for payment of the Notes outstanding; and Fifth: the balance, if any, to Grantor. ARTICLE XII 12. Remedies, Etc., Cumulative. Each legal, equitable or contractual right, power or remedy of Grantee now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Grantee of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. ARTICLE XIII 13. No Waiver, Etc. No failure by Grantee to insist upon the strict performance of any term hereof or to exercise any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Indenture or under the Loan Agreement during the continuance of any Default shall constitute a waiver thereof. No waiver of any breach shall affect or alter this Indenture which shall continue in full force and effect with respect to any other then existing or subsequent breach. ARTICLE XIV 14. Right of Grantee to Perform Covenants, Etc. If Grantor shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Grantee, without notice to or demand upon Grantor and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Grantor and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Grantee, may be necessary or appropriate therefor. All sums so paid by Grantee and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Indebtedness secured by this Indenture and shall be paid by Grantor to Grantee on demand. 16 16 ARTICLE XV 15. Certificate as to No Default, Etc.; Information. At any time and from time to time, Grantor will deliver to Grantee, promptly upon request, a certificate signed by a duly authorized officer of Grantor stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Grantor is taking or proposes to take with respect thereto. Grantor will also furnish promptly to Grantee, such information with respect to the Property and the Leases as may from time to time be requested. ARTICLE XVI 16. Additional Instruments. Grantor, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Grantee from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Indenture or intended so to be. ARTICLE XVII 17. Satisfaction of the Indenture. This Indenture and the estate created hereby shall terminate after the payment in full of (a) all the Indebtedness and (b) all other sums secured hereby. Upon such termination, and upon surrender of this Indenture for cancellation, Grantee shall release, without warranty, the Property then subject to the estate created hereby to the Persons entitled thereto. The recitals in any satisfaction executed under this Indenture of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such release may be described as "the person or persons legally entitled thereto". Grantee, at Grantor's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the estate created hereby, and (b) any other security held by Grantee and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Indenture. ARTICLE XVIII 18. Applicable Law; Severability. (a) This Indenture shall be governed by and construed in accordance with the laws of the State. (b) All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Indenture invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Indenture shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. 17 17 ARTICLE XIX 19. Miscellaneous. This Indenture (a) may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and (b) shall be binding upon Grantor, its successors and assigns, and all Persons claiming under or through Grantor or any such successor or assign, and shall inure to the benefit of and be enforceable by Grantee and its successors and assigns. The headings in this Indenture are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All agreements between Grantor and Grantee, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Grantee exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Grantee in excess of the maximum lawful amount, and if in any circumstance Grantee shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Grantor. All interest paid or agreed to be paid to Grantee shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Grantor and Grantee. This Indenture may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. ARTICLE XX 20. Change in Method of Taxation. In the event of the passage, after the date of this Indenture, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Grantee in the Property, this Indenture or the Loan Agreement, Grantor shall, upon demand, bear and pay the full amount (or any partial amount) requested by Grantee, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE XXI 21. No Petition. Grantee hereby covenants and agrees that it will not institute against, or join any Person in instituting against Grantor, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law at any time other than on a date which is 18 18 at least one (1) year and one (1) day after the payment in full of the Notes; provided, however, that nothing in this Article shall constitute a waiver of any right to indemnification, reimbursement or other payment from Grantor pursuant to the Loan Agreement. ARTICLE XXII 22. The Indenture Secures Future Advances. This Indenture is given to secure not only the amount initially secured by this Indenture, but also such future advances, whether such advances are obligatory or are to be made at the option of Grantee, or otherwise, to the same extent as if such future advances were made on the date of the execution of this Indenture. The total amount of Indebtedness that may be so secured may decrease or increase from time to time, but the total unpaid balance so secured at one time shall not exceed two (2) times the face amount of the amount initially secured by this Indenture, plus interest thereon. ARTICLE XXIII 23. Assignment of Leases and Rents. Grantor hereby grants, transfers and assigns to Grantee Grantor's entire right, title and interest in and to the Leases and Rents. This assignment of Leases and Rents by Grantor to Grantee is intended to operate as an absolute and immediate assignment of such Leases and Rents. 23.1. Grantor's Representations and Warranties. (a) Grantor has good and lawful right, title, and interest in and to the Leases, is entitled to receive the Rents from the Leases and from the Property, has full power and authority to assign the Leases as provided herein and to grant to and confer upon Grantee the powers, interests and authority set forth herein, and has not assigned the Leases or Rents to any other party; (b) Grantor has neither done any act nor omitted to do any act which might prevent Grantee from, or limit Grantee in, acting under any of the provisions of this assignment of Leases and Rents; (c) All Leases provide for Rent to be paid monthly, in advance, and Grantor has not accepted and will not accept payment of Rent for more than one (1) month in advance; provided, however, Grantor may accept payment of Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month; and there are no agreements, understandings, or undertakings by Grantor providing for free or reduced Rent in the past or in the future except as provided in the Leases; (d) Except as disclosed to Grantee in writing, Grantor is not now in default, the nature of which could have a material adverse impact on the financial condition of Grantor or the value of the Property, under any provision of any of the Leases, and no tenant under 19 19 any of the Leases has claimed or asserted any defense, offset, counter-claim, or abatement of rent, and that the Leases remain in full force and effect. Grantor further represents and warrants that it has no knowledge of any default by any tenant under any of the Leases that could materially adversely affect the value of the Property; (e) This assignment of Leases and Rents, the Leases, the performance of each and every covenant of Grantor under the Leases, and the enforcement by Grantee of its rights hereunder does not conflict with, or will not conflict with, and does not constitute or will not constitute a breach or default, under any agreement, indenture or other instrument to which Grantor is a party, or so far as is known to Grantor, any law, ordinance, administrative regulation or court decree which is applicable to Grantor; (f) No action has been brought or, so far as is known to Grantor, is threatened, which would interfere in any way with the right of Grantor to execute and deliver this assignment of Leases and Rents, and to perform all of Grantor's obligations contained in this assignment of Leases and Rents and in the Leases; and (g) To Grantor's knowledge, the Leases are valid, enforceable and in full force and effect. 23.2. Grantor's Covenants. Grantor hereby covenants and agrees to and with Grantee as follows: (a) Grantor will notify Grantee in writing (but without any right of approval or denial on the part of Grantee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement); (b) Grantor hereby acknowledges that any and all Rents collected or received by Grantor after the occurrence of an Event of Default will be the property of Grantee, which if received and collected by Grantor, will be considered received and collected on Grantee's behalf and as Grantee's agent, and will be held by Grantor in trust for the benefit of Grantee, and Grantor will deliver all such sums to Grantee immediately upon Grantor's request therefor; (c) In accordance with sound business judgment, Grantor will use its reasonable best efforts, at its cost and expense, to observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Grantor or its agents under the Leases, and will use its best efforts, in accordance with sound business judgment, to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Grantor will not do or permit to be done anything to impair the security thereof, including without limitation the execution of any 20 20 other assignment of Grantor's interest in the Leases or the Rents, without Grantee's prior written consent; (d) Grantor authorizes and directs each and every present and future tenant under the Leases to pay all Rent to Grantee upon receipt of written demand from Grantee to so pay the same, and upon paying the same, such tenants will be relieved from all liability to Grantor for such Rent in all respects. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Grantee of the remedies provided for by law or by this assignment of Leases and Rents, the tenant thereunder will, upon request of any person succeeding to the interest of Grantor as a result of such enforcement, automatically become the tenant of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month in advance; (e) This assignment of Leases and Rents will not obligate Grantee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Grantor under any Lease, or for the control, care, management, or repair of the Property; nor will it operate to make Grantee responsible or liable for any waste committed on the Property by the tenants or any other parties or for any dangerous or defective condition of the Property, or for any act or omission relating to the management, upkeep, repair, or control of the Property that results in loss or injury or death to any person. Grantee will not be liable for any loss sustained by Grantor resulting from Grantee's failure to lease the Property after default. Grantor will and does hereby indemnify and agree to hold harmless Grantee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this assignment of Leases and Rents and from any and all claims and demands whatsoever which may be asserted against Grantee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases except to the extent the same is caused by the negligence of Grantee. Should Grantee incur any such liability under the Leases or by reason of this assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Grantor will reimburse Grantee therefor immediately upon demand and upon the failure of Grantor so to do, Grantee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Grantor as an advance under the Notes; and (f) This assignment of Leases and Rents is made without prejudice to any of the rights and remedies possessed by Grantee under the Loan Agreement, and the right of Grantee to exercise its remedies under this assignment of Leases and Rents may be exercised by Grantee either prior to, simultaneously with, or subsequent to any action taken by it under the Loan Agreement. Each and every right, remedy and power granted to Grantee by this assignment of Leases and Rents will be cumulative and in addition to any other right, remedy and power given by the Loan Agreement now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this assignment 21 21 of Leases and Rents, and no act done or omitted by Grantee pursuant to the powers and rights granted it hereunder, nor the failure of Grantee to avail itself of any of the rights and remedies under this assignment of Leases and Rents, will be construed or deemed to be a waiver of any of Grantee's rights and remedies under this assignment of Leases and Rents, nor will such exercise or omission to exercise of the powers and rights granted Grantee hereunder be deemed to constitute a waiver of its rights and remedies under the Loan Agreement. 23.3. Grantee's Covenants. (a) Although this assignment of Leases and Rents constitutes a present and absolute assignment of the Leases and the Rents, as long as there is no Event of Default on the part of Grantor, Grantee will not require that such Rents be paid directly to Grantee, and Grantor will have a license to collect and use the Rents for subsequent application as provided above; (b) Upon the payment and performance in full of Grantor's obligations under the Loan Agreement, as evidenced by the recording or filing of an instrument of satisfaction or termination of this Indenture without the recording of another security instrument in favor of Grantee affecting the Property, this assignment of Leases and Rents will be deemed terminated and released of record by Grantee and thereupon will be null and void and of no further force or effect. 23.4. Remedies. If any Event of Default occurs, Grantee may, at its option, with or without notice or demand of any kind, exercise any and all of the following remedies: (a) Either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Property, to have, hold, manage, lease and operate the same on such terms and for such period of time as Grantee may deem proper, and either with or without taking possession of the Property in its own name, demand and receive the Rents in the possession of Grantor at the time of Grantee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Grantee, and to apply such Rents to the payment of: (i) all reasonable expenses of managing the Property, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Grantee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Grantee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Property and protecting and preserving the same; or (ii) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Grantee in its sole discretion may determine, any custom or use to the contrary notwithstanding; and 22 22 (b) In the name of Grantor or of Grantee, institute any legal or equitable action which Grantee in its sole discretion deems desirable to collect and receive any or all of the Rents. Nothing herein contained will be construed to cause Grantee to be a mortgagee in possession nor will Grantee be liable for laches for failure to collect the Rents, and it is understood that Grantee is to account only for such sums as are actually received by Grantee. 23.5. Further Assurances. At Grantee's request, Grantor will assign and transfer to Grantee any and all subsequent Leases upon all or any part of the Property and to execute and deliver at the request of Grantee all such further assurances and assignments in the Leases and the Rents as Grantee will require from time to time in its sole discretion. 23.6. Subordination, Nondisturbance and Attornment. The Leases are and at all times shall be subject and subordinate in all respects to this Indenture, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of this Indenture, to the full extent of all principal, interest and all other amounts secured hereby. Provided that a tenant is not in default under its Lease, Grantee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of this Indenture, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided herein, or pursuant to the laws of the State of Georgia. If requested by a tenant under any of the Leases or upon Grantee's request, Grantor shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Grantee) with such tenant whereby Grantee will agree to not disturb the tenant in its possession of the Property provided such tenant is not in default under its Lease and the tenant will agree to attorn to Grantee if Grantee takes possession of the Property. ARTICLE XXIV 24. Security Agreement. (a) This Indenture is hereby made and declared to be a security agreement, encumbering each and every item of personal property included herein, in compliance with the provisions of the Uniform Commercial Code as enacted in the State. A financing statement or statements reciting this Indenture to be a security agreement, affecting all of said personal property aforementioned, shall be executed by Grantor and Grantee and appropriately filed. The remedies for any violation of the covenants, terms and conditions of the security agreement herein contained shall be (i) as prescribed herein, or (ii) as prescribed by general law, or (iii) as prescribed by the specific statutory consequences now or hereafter enacted and specified in said Uniform Commercial Code, all at Grantee's sole election. Grantor and Grantee agree that the filing of such financing statement(s) in the records normally having to do with personal property shall never be construed as in any way derogating from or impairing this declaration and hereby stated intention of Grantor 23 23 and Grantee that everything used in connection with the production of income from the Property and/or adapted for use therein and/or which is described or reflected in this Indenture, is, and at all times and for all purposes and in all proceedings both legal or equitable shall be, regarded as part of the Property irrespective of whether (i) any such item is physically attached to the Improvements, (ii) serial numbers are used for the better identification of certain items capable of being thus identified in a recital contained herein, or (iii) any such item is referred to or reflected in any such financing statement(s) so filed at any time. Similarly, the mention in any such financing statement(s) of the rights in and to (aa) the proceeds of any fire and/or hazard insurance policy, or (bb) any award in eminent domain proceeds for a taking or for loss of value, or (cc) Grantor's interest as lessor in any present or future lease or rights to income growing out of the use and/or occupancy of the Property, whether pursuant to lease or otherwise shall never be construed as in anyway altering any of the rights of Grantee as determined by this instrument impugning the priority of Grantee's estate granted hereby or by any other recorded document, but such mention in such financing statement(s) is declared to be for the protection of Grantee in the event any court shall at any time hold with respect to the foregoing (aa), (bb) or (cc), that notice of Grantee's priority of interest to be effective against a particular class of persons, must be filed in the Uniform Commercial Code records. (b) Grantor warrants that (i) Grantor's (that is "Debtor's") name, identity or corporate structure and residence or principal place of business are as set forth in Exhibit C hereto; (ii) Grantor (that is, "Debtor") has been using or operating under said name, identity or corporate structure without change for the time period set forth in Exhibit C hereto; and (iii) the location of the collateral is upon the Property. Grantor covenants and agrees that Grantor will furnish Grantee with notice of any change in the matters addressed by clauses (i) or (iii) of this subparagraph (b) within thirty (30) days of the effective date of any such change and Grantor will promptly execute any financing statements or other instruments deemed necessary by Grantee to prevent any filed financing statement from becoming misleading or losing its perfected status. ARTICLE XXV 25. Waiver of Homestead. Grantor hereby waives and renounces all homestead and exemption rights provided for by the Constitution and laws of the United States and of any state, in and to the Property as against the collection of the secured obligations, or any part hereof. ARTICLE XXVI 26. WAIVER OF GRANTOR'S RIGHTS. BY EXECUTION OF THIS INDENTURE, GRANTOR EXPRESSLY: (A) ACKNOWLEDGES THE RIGHT TO ACCELERATE THE INDEBTEDNESS SECURED HEREBY AND THE POWER OF ATTORNEY GIVEN HEREIN TO GRANTEE TO SELL THE PROPERTY BY NONJUDICIAL FORECLOSURE UPON DEFAULT BY GRANTOR WITHOUT ANY JUDICIAL 24 24 HEARING AND WITHOUT ANY NOTICE OTHER THAN SUCH NOTICE (IF ANY) AS IS SPECIFICALLY REQUIRED TO BE GIVEN UNDER THE PROVISIONS OF THIS INDENTURE; (B) WAIVES ANY AND ALL RIGHTS WHICH GRANTOR MAY HAVE UNDER THE CONSTITUTION OF THE UNITED STATES (INCLUDING THE FIFTH AND FOURTEENTH AMENDMENTS THEREOF, THE VARIOUS PROVISIONS OF THE CONSTITUTIONS FOR THE SEVERAL STATES, OR BY REASON OF ANY OTHER APPLICABLE LAW), (1) TO NOTICE AND JUDICIAL HEARING PRIOR TO THE EXERCISE BY GRANTEE OF ANY RIGHT OR REMEDY HEREIN PROVIDED TO GRANTEE EXCEPT SUCH NOTICE (IF ANY) AS IS SPECIFICALLY REQUIRED TO BE PROVIDED IN THIS INDENTURE; AND (2) CONCERNING THE APPLICATION, RIGHTS OR BENEFITS OF ANY MORATORIUM, REINSTATEMENT, MARSHALING, FORBEARANCE, APPRAISEMENT, VALUATION, STAY, EXTENSION, HOMESTEAD, EXEMPTION OR REDEMPTION LAWS; (C) ACKNOWLEDGES THAT GRANTOR HAS READ THIS INDENTURE AND ANY AND ALL QUESTIONS REGARDING THE LEGAL EFFECT OF THIS INDENTURE AND ITS PROVISIONS HAVE BEEN EXPLAINED FULLY TO GRANTOR AND GRANTOR HAS CONSULTED WITH COUNSEL OF GRANTOR'S CHOICE PRIOR TO EXECUTING THIS INDENTURE; AND (D) ACKNOWLEDGES THAT ALL WAIVERS OF THE AFORESAID RIGHTS OF GRANTOR HAVE BEEN MADE KNOWINGLY, INTENTIONALLY AND WILLINGLY BY GRANTOR AS PART OF A BARGAIN FOR THE LOAN TRANSACTION AND THAT THIS INDENTURE IS VALID AND ENFORCEABLE BY GRANTEE AGAINST GRANTOR IN ACCORDANCE WITH ALL THE TERMS AND CONDITIONS HEREOF. ARTICLE XXVII 27. Approval of Legal Description. Grantor has read and does hereby approve the legal description of the Land which Is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Grantee and its attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XXVIII 28. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Indenture and the Loan Agreement, the Loan Agreement shall control. 25 25 ARTICLE XXIX 29. WAIVER OF JURY TRIAL. GRANTOR AND GRANTEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER GRANTOR NOR GRANTEE, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS DEED TO SECURE DEBT, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN GRANTOR AND GRANTEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY GRANTOR AND GRANTEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR GRANTEE TO MAKE THE LOAN TO GRANTOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. IN WITNESS WHEREOF, Grantor has caused this Indenture to be executed, sealed, and attested by its proper officers thereunto duly authorized, as of the day and year first above written. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ------------------------------------- ---------------------------- Unofficial Witness Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- /s/ Dee Price - ------------------------------------- Notary Public Attest: /s/ W. Lawrence Jenkins ------------------------ Name: W. Lawrence Jenkins -------------------------- Title: Corporate Secretary ------------------------- My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 26 26 EXHIBIT A The Land 27 EXHIBIT B Permitted Encumbrances 28 EXHIBIT C DEBTOR NAME: Koger Equity, Inc. CORPORATE STRUCTURE: a Florida corporation PRINCIPAL PLACE OF BUSINESS: 3986 Boulevard Center Drive #101 Jacksonville, Florida 32207 TIME PERIOD USING NAME WITHOUT CHANGE June 21, 1988, to present SECURED PARTY NAME: First Union National Bank, as Agent for the Lenders PRINCIPAL PLACE OF BUSINESS: 301 South College Street Charlotte, North Carolina 28288 EX-10.(K)(4)(A)(II) 13 AMEND TO ASSIGNMENT OF LEASES AND RENTS 1 THIS INSTRUMENT PREPARED BY AND RECORD AND RETURN TO: EXHIBIT 10(k)(4)(a)(ii) Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS THIS AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS (this "Amendment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement") which terms Assignor and Assignee, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. For purposes of notices permitted or required to be given hereunder, Assignee's mailing address is 301 South College Street, Charlotte, North Carolina 28288 Attention:First Union Capital Markets Group. RECITALS: A. Assignor is the grantor under that certain Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents, and Security Agreement given by Assignor to the grantees defined therein, as grantee, dated December 29, 1997, and recorded in Official Records Book 9767, Page 002, of the public records of DeKalb County, Georgia (the "Deed to Secure Debt"), which Deed to Secure Debt secured that certain (i) Substitution Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of First Union National Bank in the principal amount of $35,000,000; (ii) Substitution Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of Morgan Guaranty Trust Company of New York in the principal amount of $15,000,000; (iii) Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of AmSouth Bank in the principal amount of $25,000,000, and (iv) Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of Guaranty Federal Bank, F.S.B. in the principal amount of $25,000,000 (collectively, the "Prior Notes"), encumbering certain real property interests located in DeKalb County, Georgia as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment and performance of the Prior Notes, Assignor agreed to execute and deliver to Assignee that certain Assignment of Leases and Rents dated as of December 29, 1997, which was recorded in Official Records Book 9767, Page 045, of the public records of DeKalb County, Georgia (the "Assignment"), which Assignment was assigned to Assignee pursuant to that certain Assignment of Deed to 1 3 Secure Debt and Related Loan Documents of even date herewith to be recorded in the public records of DeKalb County, Georgia. C. The Deed to Secure Debt has been modified and amended pursuant to that certain Second Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement of even date herewith, to be recorded in the Public Records of DeKalb County, Georgia, to increase the Indebtedness secured thereby to $150,000,000 evidenced by those certain: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes"). D. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Amendment for the purposes set forth herein. E. Assignor and Assignee desire to amend the Assignment to set forth that the loan evidenced by the Prior Notes has been modified, amended, and extended as evidenced by the Notes defined above. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows: 1. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. The Assignment is hereby amended to secure the payment, discharge, and performance of the Notes, and all references in the Assignment to the "Notes" are hereinafter deemed to refer to the "Notes" of even date herewith as defined herein. 3. All references in the Assignment to the "Loan Agreement" shall be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith. 2 4 4. The term "Assignee" as defined in the Assignment, is hereby deemed to refer to First Union National Bank, as Agent for the Lenders, which Lenders are defined in the Loan Agreement. 5. Except as herein expressly amended, the Assignment is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 6. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Assignment. 7. This Amendment may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. 8. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS AMENDMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 3 5 IN WITNESS WHEREOF, Assignor and Assignee have executed this Amendment under seal the day and year first above written. Signed, sealed and delivered in ASSIGNOR: the presence of: KOGER EQUITY, INC., a Florida corporation /s/ Alan C. Sheppard, Jr. By: /s/ G. Danny Edwards - ------------------------------------------ ----------------------------- Unofficial Witness: Alan C. Sheppard, Jr. Name: G. Danny Edwards --------------------- --------------------------- Title: Treasurer -------------------------- Attest: /s/ W. Lawrence Jenkins -------------------------- Name: W. Lawrence Jenkins --------------------------- /s/ Dee Price Title: - ------------------------------------------ ------------ Secretary Notary Public [AFFIX CORPORATE SEAL] My Commission Expires: Feb. 1, 1999 Notary Public, Camden County, Georgia - ------------------------------------------ [Notary Seal] ASSIGNEE FIRST UNION NATIONAL BANK, a national association /s/ Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead - ------------------------------------------ ------------------------- Unofficial Witness: Alan C. Sheppard, Jr. Name: Andrew J. Hogshead --------------------- ----------------------- Title: Vice President ---------------------- Attest: /s/ Lynn E. Vermilva ---------------------- Name: Lynn E. Vermilva ----------------------- /s/ Nancy Hoffmann Title: Vice President - ------------------------------------------ ---------------------- Notary Public [AFFIX CORPORATE SEAL] My Commission Expires: September 3, 2000 Bonded Thru Notary Public Underwriters - ------------------------------------------ [Notary Seal] 4 6 EXHIBIT A LEGAL DESCRIPTION OF PREMISES EX-10.(K)(4)(A)(III) 14 AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGRMT 1 EXHIBIT 10 (k)(4)(a)(iii) AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - -------------------------------------------------------------------------------- AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT - -------------------------------------------------------------------------------- THIS AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Amendment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Agent (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank F.S.B., a federal savings bank (collectively, the "Original Lenders") entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, Borrower provided the Original Lenders with that certain Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement dated as of December 29, 1997, and recorded in Official Records Book 9767, page 002, of the public records of DeKalb County, Georgia (the "Indenture"), wherein Borrower granted to the Original Lenders a security interest in certain real property located in DeKalb County, Georgia, and described therein (the "Property") as security for the Loan. 3. As a condition precedent to and as a material inducement for the Original Lenders' agreement to provide the Loan to Borrower, the Original Lenders required Borrower to execute and deliver that certain Environmental Indemnification Agreement 3 dated as of December 29, 1997 covering the Property (the "Environmental Agreement"), which Environmental Agreement was assigned to Agent pursuant to that certain Assignment of Deed to Secure Debt and Related Loan Documents of even date herewith. 4. Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Indenture. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Environmental Agreement is modified in accordance with the terms and conditions hereinafter set forth. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" or "Lenders" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders under and as defined in the Loan Agreement. 3. Additional Promissory Notes. All references to the term "Notes" as utilized in the Environmental Agreement shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of the Lenders, as applicable. 4. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith between Borrower and First Union National Bank, as Agent for the Lenders. All references to the term "Loan" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 5. Amended and Restated Indenture. All references to the term "Indenture" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to that certain Second Amended and Restated Deed to Secure Debt, Assignment of Leases and Security Agreement from Borrower to Agent of even date herewith, and to be recorded in the public records of DeKalb County, Georgia. 2 4 6. Ratification. Except as herein expressly amended, the Environmental Agreement is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 7. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Environmental Agreement. 8. Counterparts. This Amendment may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written. Signed, sealed and delivered in the BORROWER: presence of: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long - -------------------------------------- Unofficial Witness By: /s/ G. Danny Edwards ----------------------------- Name: G. Danny Edwards /s/ Dee Price --------------------------- - -------------------------------------- Title: Treasurer Notary Public ------------------------- Attest: /s/ W. Lawrence Jenkins ------------------------- Name: W. Lawrence Jenkins --------------------------- Title: Secretary ------------------ My Commission Expires: Feb. 1, 1999 Public Notary, Camden County, GA [CORPORATE SEAL] - -------------------------------------- [NOTARY SEAL] 3 5 Signed, sealed and delivered in the presence of: LENDER: FIRST UNION NATIONAL BANK, a /s/ Alan C. Sheppard, Jr. national association, as Agent - ---------------------------------------- Unofficial Witness Alan C. Sheppard, Jr. By: /s/ Andrew Hogshead ------------------------------ /s/ Nancy Hoffmann Name: /s/ J. Andrew Hogshead - ---------------------------------------- ---------------------------- Notary Public Title: Vice President -------------------------- Attest: /s/ Lynn E. Vermilva My Commission Expires: September 3, 2000 ------------------------- Bonded Thru Notary Public Underwriters Name: Lynn E. Vermilva - ---------------------------------------- --------------------------- [NOTARY SEAL] Title: Vice President Secretary ----------------- [CORPORATE SEAL] 4 EX-10.(K)(4)(A)(IV) 15 AMEND TO ASSGNM OF CONTRACTS LICENSES & RENTS 1 EXHIBIT 10 (K)(4)(A)(IV) AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - ------------------------------------------------------------------------------- AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS - ------------------------------------------------------------------------------- THIS AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS (this "Assignment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders (as such term is defined in the Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Lender (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank, F.S.B., a federal savings bank (collectively, the "Original Lenders"), entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to the Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, the Borrower provided the Original Lenders with that certain Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement dated as of December 29, 1997, and recorded in Book 9767, page 002, of the public records of DeKalb County, Georgia (the "DeKalb Mortgage"), wherein the Borrower granted to the Original Lenders a security interest in certain real property described therein as security for the Loan. 3. As additional collateral for repayment of the Loan, Borrower made and delivered to the Original Lenders that certain Assignment of Contracts, Licenses and Permits dated December 29, 1997 (the "Assignment of Contracts"), which Assignment of Contracts was assigned to Agent pursuant to that certain Assignment of Deed to Secure Debt and Related Loan Documents of even date herewith. 3 4. The Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Mortgage. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Assignment of Contracts is modified in accordance with the terms and conditions hereinafter set forth. 5. To further secure the additional indebtedness in connection with the increase and resyndication of the Loan, Borrower provided the Agent that certain (i) Second Amended and Restated Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement dated of even date herewith, which amends and restates the DeKalb Mortgage and shall be recorded in the public records of DeKalb County, Georgia, and (ii) Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement dated of even date herewith, encumbering the Additional Property described on Exhibit A attached hereto, and which shall be recorded in the public records of Gwinnett County, Georgia. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders. 3. Additional Property. Exhibit A attached to the Assignment of Contracts is hereby amended to include the real property located in DeKalb County, Georgia and Gwinnett County, Georgia, more particularly described on Exhibit A attached hereto (the "Additional Property"). All references to the term "Property" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to the Property, as such term is defined in the Assignment of Contracts, and the Additional Property. 4. Additional Promissory Notes. All references to the term "Notes" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of the Lenders. 5. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated 3 4 of even date herewith between Borrower and Lender. All references to the term "Loan" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 6. Ratification. Except as herein expressly amended, the Assignment of Contracts is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 7. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Assignment of Contracts. 8. Counterparts. This Agreement may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. 9. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS AMENDMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 4 5 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written.
Signed, sealed and delivered in the BORROWER: presence of: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ----------------------------------------- ---------------------------- Unofficial Witness: Janice R. Long Name: G. Danny Edwards ---------------------- --------------------------- Title: Treasurer -------------------------- Attest: W. Lawrence Jenkins ------------------------- Name: W. Lawrence Jenkins --------------------------- /s/ Dee Price Title: Secretary - ----------------------------------------- --------------- Notary Public [CORPORATE SEAL] My Commission Expires: Feb. 1, 1999 Notary Public, Camden County, Georgia - ----------------------------------------- [Notary Seal] LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead - ----------------------------------------- ---------------------------- Unofficial Witness: Alan C. Sheppard, Jr. Name: J. Andrew J. Hogshead ---------------------- -------------------------- Title: Vice President ------------------------- Attest: /s/ Lynn E. Vermilva ----------------------- Name: Lynn E. Vermilva -------------------------- /s/ Nancy Hoffmann Title: Vice President - --------------------------------------- ------------------------- Notary Public [CORPORATE SEAL] My Commission Expires: Sept. 3, 2000 Bonded Thru Notary Public Underwriters - --------------------------------------- [Notary Seal]
5 6 EXHIBIT A DESCRIPTION OF PROPERTY EX-10.(K)(4)(B)(I) 16 DEED TO SECURE DEBT ASSGN OF LEASES & RENTS 1 EXHIBIT 10(K)(4)(B)(I) THIS INSTRUMENT PREPARED BY AND RECORD AND RETURN TO: ALAN C. SHEPPARD, JR., ESQ. LEBOEUF, LAMB, GREENE & MACRAE, L.L.P. 50 NORTH LAURA STREET, SUITE 2800 JACKSONVILLE, FL 32202-3650 DEED TO SECURE DEBT, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT from KOGER EQUITY, INC. to FIRST UNION NATIONAL BANK, as Agent Dated as of December 30, 1998 State: Georgia Section: Township: Range: County: Gwinnett Tax I.D.: - -------------------------------------------------------------------------------- NOTE TO TAX COMMISSIONER: THIS INSTRUMENT SECURES A NOTE CONTAINING A MATURITY DATE THREE (3) YEARS FROM THE DATE THEREOF AND, THEREFORE, SUCH NOTE IS A "SHORT-TERM NOTE SECURED BY REAL ESTATE" AS SUCH TERM IS DEFINED IN OFFICIAL CODE OF GEORGIA ANNOTATED SECTION 48-6-60. CONSEQUENTLY, NO INTANGIBLES TAX IS DUE UPON THE RECORDATION OF THIS INSTRUMENT. SEE OFFICIAL CODE OF GEORGIA ANNOTATED SECTION 48-6-61. 2 DEED TO SECURE DEBT, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT THIS DEED TO SECURE DEBT, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT (this "Indenture"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Grantor"), whose mailing address is 3986 Boulevard Center Drive, Suite 101, Jacksonville, Florida 32207 Attention: J.C. Teagle, President, to FIRST UNION NATIONAL BANK, a national association, as Agent ("Grantee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, Grantee's mailing address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. Capitalized terms not otherwise defined herein are defined in Article I. WITNESSETH: THIS INDENTURE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Grantor and all indebtedness heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other indebtedness which this Indenture by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to the Lenders, (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of indebtedness secured hereby, other than for advances made pursuant to Article XXII, Paragraph 22 hereof, shall in no event exceed $150,000,000.00 (the "Indebtedness") and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, and in consideration of the aforesaid Indebtedness, Grantor hereby irrevocably grants, bargains and sells, conveys, transfers, assigns, sets over, alienates, hypothecates and pledges to Grantee and its successors and assigns in and to all of the following property and rights whether now owned or hereafter acquired by Grantor (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the "Improvements"); 2 3 (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) all fixtures, machinery, equipment and other personal property of all types owned by Grantor now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Grantor's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Indebtedness; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Grantor, to appear in and defend any action or proceeding brought with respect to Grantor's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Grantee in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property and all parts, rights, members and appurtenances thereof, for the use, benefit and behoof of Grantee, IN FEE SIMPLE forever. PROVIDED ALWAYS, this Indenture is intended to operate and is to be construed as a deed passing title to the Property to Grantee and is made under those provisions of the existing laws of the State of Georgia relating to deeds to secure debt, and not as a mortgage, and is given to secure the payment of the Indebtedness. Should the Indebtedness be paid according to the tenor and effect thereof when the same shall become due and payable, and should Grantor perform all covenants herein in a timely manner, then this Indenture shall be cancelled and surrendered by Grantee. 3 4 IN FURTHERANCE OF THE FOREGOING GRANTS (INCLUDING GRANTS OF SECURITY INTERESTS), BARGAINS, SALES, ALIENATIONS, CONVEYANCES, CONFIRMATIONS, PLEDGES, TRANSFERS AND ASSIGNMENTS, AND TO PROTECT THE PROPERTY AND THE SECURITY GRANTED BY THIS INDENTURE, GRANTOR, FOR ITSELF AND FOR ITS SUCCESSORS AND ASSIGNS, HEREBY WARRANTS, REPRESENTS, COVENANTS AND AGREES AS FOLLOWS: ARTICLE I 1. Definitions. As used in this Indenture, the following capitalized terms have the respective meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Article V of this Indenture. "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in clause (iv) of the Granting Clause of this Indenture. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Grantee" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Grantor" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. 4 5 "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Grantor, Grantee or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in clause (ii) of the Granting Clause of this Indenture. "Indebtedness" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Indenture" shall mean this Deed to Secure Debt, Assignment of Leases and Rents, and Security Agreement. "Land" shall mean those certain parcels of real property located in the County of Gwinnett, State of Georgia, as more particularly described on Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "Lenders" shall mean FUNB, AmSouth, GFB, Citizens, Compass, and any other Lenders from time to time under the Loan Agreement. "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 between Grantor and Grantee. "Loan Documents" shall mean this Indenture, the Loan Agreement, the Notes, the Security Deeds, the Lease Assignments, the Assignments of Contracts, the Indemnification Agreement, and any other instrument, document, affidavits, or certificates given by Grantor to the Grantee or any trustee for the benefit of the Lenders in support of, or evidencing or securing, the Loan. "Notes" shall mean collectively (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as 5 6 of even date herewith made by Grantor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Compass in the original principal amount of $15,000,000. "Other Indenture" shall mean any mortgage, deed to secure debt, or deed of trust given by Grantor to or in favor of Grantee to secure the Indebtedness, other than this Indenture. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Rents" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "State" shall mean the State of Georgia. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. ARTICLE II 2. Representations and Warranties. Grantor represents and warrants to Grantee that (a) it has full power, authority and legal right to execute and deliver this Indenture and to grant a first deed to secure debt of the Property, (b) it holds good and marketable fee simple title to the Land and good and marketable title to the balance of the Property, (c) this Indenture constitutes a valid first deed to secure debt of the Property, subject to the Permitted Encumbrances, and (d) the Leases are in full force and effect in accordance with their respective terms, have not been canceled or modified, and have not been assigned or encumbered except to Grantee pursuant to this Indenture and the Loan Agreement, and, to the best of Grantor's knowledge, no default exists under the Leases. Grantor, at its expense, will warrant to Grantee and will defend its title to the Property and the estate created by this Indenture against all claims and demands, and will maintain and 6 7 preserve such estate so long as the Indebtedness secured by this Indenture remains outstanding, subject, however, to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Indenture and the estate created hereby shall terminate in accordance with Article XVII, Grantor shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Indenture and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the estate created hereby and the rights of Grantee hereunder. Grantor shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance. (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end. (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the same shall be contested in good faith and by appropriate proceedings by Grantor in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that Grantee is otherwise in compliance with the Loan Agreement. Upon the written request of Grantee from time to time, Grantor will furnish to Grantee official receipts or other satisfactory proof evidencing such payments. In addition, Grantor will pay all utility charges as required by the Loan Agreement. Grantor shall not be entitled to any credit on the Indebtedness, by reason of the payment of any Imposition or utility charges or any part thereof. (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Grantor in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvements and the Fixtures, or any part of either thereof. (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Grantee any certificates or evidence of such insurance as required under the Loan Agreement. 7 8 (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Grantor shall give immediate written and oral notice thereof to Grantee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Grantee shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Grantor would be entitled thereto under the Loan Agreement, and Grantor hereby irrevocably assigns to Grantee all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Grantor will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Grantee. At the sole cost and expense of Grantor, Grantee may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Grantee in connection with, any claim or the claims payment process. Grantor will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Grantee shall be applied in accordance with the provisions of the Loan Agreement. (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Grantee of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. (h) Corporate Existence. Preserve and keep in full force and effect its corporate existence, rights and franchises and privileges as a corporation under the laws of the State of Georgia and comply with all laws applicable to it, and do or cause to be done all things necessary to preserve and to keep in full force and effect its right to own property in the State of Georgia. (i) Inspection. Permit the Beneficiary or its authorized representatives to inspect the Property during usual business hours. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Grantee, Grantor will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Grantee therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Indenture, (ii) the Permitted Encumbrances, (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement, (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement, and (v) liens arising out of or created by any statute, the discharge of which cannot under the terms of such statute at the particular time be effected by Grantor; provided, however, that 8 9 any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Grantor shall have the right to grant, without the prior consent of Grantee, any utility easement. ARTICLE V 5. Events of Default. Any of the following events (each a "Default") shall, following the passage of any grace or cure period as provided below, constitute an Event of Default ("Event of Default"): (a) Grantor shall fail to make any payment of principal under any of the Notes on or before the same becomes due and payable on maturity thereof; or Grantor shall fail to make any payment of interest under any of the Notes, or any fees, costs or expenses due hereunder or thereunder, within 5 days after the same becomes due and payable. (b) Any representation or warranty made by Grantor (or any of its officers) under or in connection with any Loan Document shall be or become incorrect or untrue, or shall prove to have been incorrect or misleading in any material respect when made. (c) Grantor shall fail to perform or observe any term, covenant or agreement (other than a covenant of payment) contained in any Loan Document on its part to be performed or observed, and such failure shall remain uncured for 10 days after written notice thereof shall have been given by Grantee to Grantor, or if such failure cannot by its nature be cured within such 10 day period, Grantor shall fail to commence and diligently pursue such cure within 10 days after written notice thereof shall have been given by Grantee to Grantor and shall fail to complete such cure within 60 days after Grantee's initial written notice of such failure. (d) An involuntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced against Grantor, and such case or proceeding shall not be dismissed in 60 days; or a court shall enter a decree, or a court or regulatory authority having jurisdiction over Grantor shall enter an order, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator, supervisor, rehabilitator (or similar official) of Grantor or for any substantial part of its property, or ordering the winding-up, supervision or liquidation of its affairs. (e) Grantor shall commence a voluntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case or proceeding under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator, supervisor, rehabilitator (or other similar official) of Grantor or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its indebtedness generally as the same becomes due, or shall take any corporate action in furtherance of any of the foregoing. 9 10 (f) A judgment or order for the payment of money in excess of $2,500,000 shall be rendered against Grantor and either (A) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (B) there shall be any period of 10 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. (g) A Default has occurred and is continuing beyond any applicable grace or cure period under any Debt (other than the Loan) in excess of $2,500,000. (h) Any material provision of the Loan Documents relating to Grantee's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Grantor, or Grantor shall so state in writing. (i) The Security Agreement shall, as a result of Grantor's acts or omissions, for any reason, except to the extent permitted by the terms thereof, cease to create a valid and, upon filing of UCC-1 financing statement(s), UCC-2 Notice Filings, or UCC-3 continuation statements, as applicable, perfected first priority security interest in any of the Collateral purported to be covered, which can be so secured or perfected. ARTICLE VI 6. Remedies in Case of Event of Default. 6.1. Legal Proceedings and Foreclosure. If an Event of Default shall have occurred, Grantee may proceed by suit or suits at law or in equity or by any other appropriate remedy to protect and enforce its rights hereunder, whether for the specific performance of any covenant or agreement contained herein, or for an injunction against the violation of any of the terms hereof, or in aid of the exercise of any right, power or remedy available to it, or to enforce the payment of the Indebtedness under the Loan Agreement, or to foreclose the estate created by this Indenture and the security interest of this Indenture as against all or any part of the Property and to have all or any part of the Property sold, in any manner permitted by law, under the judgment or decree of a court or courts of competent jurisdiction, or otherwise, and to pursue any other remedy available to it. If Grantee proceeds to foreclose the estate created hereby, Grantee shall have the statutory power of sale if permitted by applicable law. In the event of any such suit or proceeding, Grantee shall comply with any local laws applicable to any such suits or proceedings. Any such suit or proceeding instituted by Grantee shall be brought in its name as Grantee and any recovery or judgment shall be for the benefit of Grantee. All costs and expenses (including, without limitation, reasonable attorney's fees and expenses) incurred by Grantee in connection with any such suit or proceeding, together with interest thereon (to the extent permitted by law) computed at the Default Rate from the date on which such costs or expenses are incurred to the date of payment thereof, shall constitute additional Indebtedness secured by this Indenture and shall be paid by Grantor to Grantee, as the case may be, on demand. 10 11 6.2. Power of Sale. Without in any way limiting the other provisions of this Indenture, but in addition thereto and in amplification thereof, upon the occurrence of any Event of Default, Grantee, at its option, may sell the Property or any part of the Property at one or more public sale or sales before the door of the courthouse of the county in which the Property or any part of the Property is situated, to the highest bidder for cash, in order to pay the Indebtedness, any and all expenses of sale and of all proceedings in connection therewith, including reasonable attorneys' fees, after advertising the time, place and terms of sale once a week for four (4) consecutive weeks (but without regard to the number of days) in a newspaper in which Sheriff's sales are advertised in said county. At any such public sale, Grantee may execute and deliver to the purchaser a conveyance of the Property or any part of the Property in fee simple, with full general warranties of title and to this end, Grantor hereby constitutes and appoints Grantee the agent and attorney-in-fact of Grantor to make any such sale and conveyance and thereby to divest Grantor of all right, title and equity that Grantor may have in and to the Property and to vest the same in the purchaser or purchasers at such sale or sales, and all the acts or doings of said agent and attorney-in-fact are hereby ratified and confirmed and any recitals in said conveyance or conveyances as to facts essential to a valid sale shall be binding upon Grantor. Grantee, its agents, representatives, successors or assigns may bid and purchase at any such sale. The aforesaid power of sale and agency hereby granted are coupled with an interest and are irrevocable by death or otherwise, are granted as cumulative of the other remedies provided hereby or by law for collection of the Indebtedness and shall not be exhausted by one exercise thereof but may be exercised until full payment of all of the Indebtedness. In the event of any sale under this Indenture by virtue of the exercise of the powers herein granted, pursuant to any order in any judicial proceeding or otherwise, the Property may be sold as an entirety or in separate parcels and in such manner or order as Grantee in its sole discretion may elect, and if Grantee so elects, Grantee may sell the personal property covered by this Indenture at one or more separate sales in any manner permitted by the Uniform Commercial Code of the State, and one or more exercises of the powers herein granted shall not extinguish nor exhaust such powers, until the entire Property is sold or the Indebtedness is paid in full. If the Indebtedness is now or hereafter further secured by any chattel mortgages, pledges, contracts of guaranty, assignments of lease or other security instruments, Grantee may, at its option, exhaust the remedies granted under any of said security instruments either concurrently or independently, and in such order as Grantee may determine. 6.3. Acceleration of Maturity. If an Event of Default shall have occurred, Grantee may declare the entire outstanding Indebtedness under the Loan Agreement, and all other sums secured hereby, to be due and payable immediately, and upon such declaration, such Indebtedness and other sums shall immediately become and be due and payable without demand or notice. 6.4. Leases. Grantee is authorized to foreclose this Indenture subject to the rights of any tenants of the Property, and the failure to make any such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, nor be asserted by Grantor to be, a defense to any proceedings instituted by Grantee to collect 11 12 the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property. 6.5. Suits to Protect the Property. Grantee shall have the power and authority to institute and maintain any suits and proceedings as Grantee may deem advisable (a) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Indenture, (b) to preserve or protect its interest in the Property, and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Grantee's interest. 6.6. Discontinuance of Proceedings; Position of Parties Restored. If Grantee shall have proceeded to enforce any right or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, then and in every such instance, Grantor and Grantee shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Grantee shall continue as if no such proceeding had occurred or had been taken. 6.7. Grantor to Pay the Indebtedness on Any Default in Payment; Application of Monies by Grantee. (a) If an Event of Default shall occur as a result of Grantor's failure to pay any amount due under the Loan Agreement or this Indenture, then, upon Grantee's demand, Grantor will pay to Grantee the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Grantor shall fail to pay the same forthwith upon such demand, Grantee shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Grantee's agents, attorneys and other representatives. Grantee shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Indenture, and the right of Grantee to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Indenture, or the foreclosure of the estate created hereby. (b) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Grantee shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. (c) Grantor hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Grantee and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the estate created hereby upon the 12 13 Property or any part thereof or any lien, rights, powers or remedies of Grantee hereunder, but such lien, rights, powers and remedies of Grantee hereunder shall continue unimpaired as before. ARTICLE VII 7.1. Purchase of the Property by Grantee. Upon any foreclosure sale, Grantee may bid for and purchase the Property, and, upon compliance with the terms of sale, may hold, retain and possess and dispose of such Property in its own absolute right without further accountability. 7.2. Application of Indebtedness Toward Purchase Price. If Grantee purchases the Property pursuant to foreclosure, power of sale or otherwise, then Grantee may, in lieu of cash, apply all or any portion of the sums due to Grantee under the Loan Agreement and this Indenture or any other instrument securing the Indebtedness, to the unpaid balance of the purchase price remaining after payment of any portion of the purchase price required to be paid in cash, and the costs and expenses of the sale, compensation and other charges relating to the sale. ARTICLE VIII 8. Waiver of Appraisement, Valuation, Etc. Grantor hereby waives, to the full extent it may lawfully do so, the benefit of all appraisement, valuation, stay, moratorium, exemption from execution, extension and redemption laws now or hereafter in force and all rights of marshaling in the event of the sale of the Property or any part thereof or any interest therein. ARTICLE IX 9. Appointment of Receiver. If an Event of Default shall have occurred, Grantee shall, as a matter of right, be entitled, ex parte and without notice, to the appointment of a receiver or receivers of the Property or any part thereof in accordance with Georgia Official Code ss.9-8-3 and without regard to the value of the Property as security for the Indebtedness, or the solvency or insolvency of any Person liable for the payment of the Indebtedness and without necessity or requirement for posting bond, whether such receivership be incidental to a proposed sale thereof or otherwise, and Grantor hereby consents to the appointment of such a receiver or receivers and will not oppose any such appointment. Any receiver which may be appointed pursuant to this paragraph, shall have the right, but not the obligation, to take possession, manage and operate the Property, together with such other powers conferred upon it by the appointing court. The expenses, including receiver's fees, attorney's fees, costs and agent's compensation, incurred pursuant to the powers herein contained shall be secured by this Indenture. 13 14 ARTICLE X 10. Possession, Management and Income. If an Event of Default shall have occurred under this Indenture, Grantee, without further notice, may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Grantor and all other Persons and any and all property therefrom, and Grantee may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Grantee shall be applied (a) to pay (i) the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Grantee and all other costs and expenses of entering a bond and taking possession of and holding the Property, and (ii) any lien prior to the estate created hereby which Grantee may consider it necessary or desirable to discharge and then (b) in the manner provided in Article XI of this Indenture. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Grantee shall be applied in the manner specified in Article XI of this Indenture. ARTICLE XI 11. Application of Proceeds. The proceeds of (a) the operation and management of the Property pursuant to Article X of this Indenture, and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Grantee or in the pursuance of any remedies hereunder; Second: to any lien prior to the estate created hereby which Grantee may consider it necessary or desirable to discharge; Third: to any Indebtedness secured by this Indenture and at the time due and payable (whether by acceleration or otherwise); Fourth: to Grantee for payment of the Notes outstanding; and Fifth: the balance, if any, to Grantor. 14 15 ARTICLE XII 12. Remedies, Etc., Cumulative. Each legal, equitable or contractual right, power or remedy of Grantee now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Grantee of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. ARTICLE XIII 13. No Waiver, Etc. No failure by Grantee to insist upon the strict performance of any term hereof or to exercise any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Indenture or under the Loan Agreement during the continuance of any Default shall constitute a waiver thereof. No waiver of any breach shall affect or alter this Indenture which shall continue in full force and effect with respect to any other then existing or subsequent breach. ARTICLE XIV 14. Right of Grantee to Perform Covenants, Etc. If Grantor shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Grantee, without notice to or demand upon Grantor and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Grantor and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Grantee, may be necessary or appropriate therefor. All sums so paid by Grantee and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Indebtedness secured by this Indenture and shall be paid by Grantor to Grantee on demand. ARTICLE XV 15. Certificate as to No Default, Etc.; Information. At any time and from time to time, Grantor will deliver to Grantee, promptly upon request, a certificate signed by a duly authorized officer of Grantor stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Grantor is taking or proposes to take with respect thereto. Grantor will also furnish promptly to Grantee, such information with respect to the Property and the Leases as may from time to time be requested. 15 16 ARTICLE XVI 16. Additional Instruments. Grantor, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Grantee from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Indenture or intended so to be. ARTICLE XVII 17. Satisfaction of the Indenture. This Indenture and the estate created hereby shall terminate after the payment in full of (a) all the Indebtedness and (b) all other sums secured hereby. Upon such termination, and upon surrender of this Indenture for cancellation, Grantee shall release, without warranty, the Property then subject to the estate created hereby to the Persons entitled thereto. The recitals in any satisfaction executed under this Indenture of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such release may be described as "the person or persons legally entitled thereto". Grantee, at Grantor's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the estate created hereby, and (b) any other security held by Grantee and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Indenture. ARTICLE XVIII 18. Applicable Law; Severability. (a) This Indenture shall be governed by and construed in accordance with the laws of the State. (b) All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Indenture invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Indenture shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. ARTICLE XIX 19. Miscellaneous. This Indenture (a) may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and (b) shall be binding upon Grantor, its successors and assigns, and all Persons claiming under or through Grantor or any such successor or assign, and shall inure to the benefit of and be enforceable by Grantee and its successors and assigns. The headings in this Indenture are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All agreements between Grantor and Grantee, whether now existing or hereafter arising 16 17 and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Grantee exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Grantee in excess of the maximum lawful amount, and if in any circumstance Grantee shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Grantor. All interest paid or agreed to be paid to Grantee shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Grantor and Grantee. This Indenture may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. ARTICLE XX 20. Change in Method of Taxation. In the event of the passage, after the date of this Indenture, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Grantee in the Property, this Indenture or the Loan Agreement, Grantor shall, upon demand, bear and pay the full amount (or any partial amount) requested by Grantee, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE XXI 21. No Petition. Grantee hereby covenants and agrees that it will not institute against, or join any Person in instituting against Grantor, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law at any time other than on a date which is at least one (1) year and one (1) day after the payment in full of the Notes; provided, however, that nothing in this Article shall constitute a waiver of any right to indemnification, reimbursement or other payment from Grantor pursuant to the Loan Agreement. ARTICLE XXII 22. The Indenture Secures Future Advances. This Indenture is given to secure not only the amount initially secured by this Indenture, but also such future advances, whether such advances are obligatory or are to be made at the option of Grantee, or otherwise, to the same extent as if such future advances were made on the date of the 17 18 execution of this Indenture. The total amount of Indebtedness that may be so secured may decrease or increase from time to time, but the total unpaid balance so secured at one time shall not exceed two (2) times the face amount of the amount initially secured by this Indenture, plus interest thereon. ARTICLE XXIII 23. Assignment of Leases and Rents. Grantor hereby grants, transfers and assigns to Grantee Grantor's entire right, title and interest in and to the Leases and Rents. This assignment of Leases and Rents by Grantor to Grantee is intended to operate as an absolute and immediate assignment of such Leases and Rents. 23.1. Grantor's Representations and Warranties. (a) Grantor has good and lawful right, title, and interest in and to the Leases, is entitled to receive the Rents from the Leases and from the Property, has full power and authority to assign the Leases as provided herein and to grant to and confer upon Grantee the powers, interests and authority set forth herein, and has not assigned the Leases or Rents to any other party; (b) Grantor has neither done any act nor omitted to do any act which might prevent Grantee from, or limit Grantee in, acting under any of the provisions of this assignment of Leases and Rents; (c) All Leases provide for Rent to be paid monthly, in advance, and Grantor has not accepted and will not accept payment of Rent for more than one (1) month in advance; provided, however, Grantor may accept payment of Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month; and there are no agreements, understandings, or undertakings by Grantor providing for free or reduced Rent in the past or in the future except as provided in the Leases; (d) Except as disclosed to Grantee in writing, Grantor is not now in default, the nature of which could have a material adverse impact on the financial condition of Grantor or the value of the Property, under any provision of any of the Leases, and no tenant under any of the Leases has claimed or asserted any defense, offset, counter-claim, or abatement of rent, and that the Leases remain in full force and effect. Grantor further represents and warrants that it has no knowledge of any default by any tenant under any of the Leases that could materially adversely affect the value of the Property; (e) This assignment of Leases and Rents, the Leases, the performance of each and every covenant of Grantor under the Leases, and the enforcement by Grantee of its rights hereunder does not conflict with, or will not conflict with, and does not constitute or will not constitute a breach or default, under any agreement, indenture or other instrument 18 19 to which Grantor is a party, or so far as is known to Grantor, any law, ordinance, administrative regulation or court decree which is applicable to Grantor; (f) No action has been brought or, so far as is known to Grantor, is threatened, which would interfere in any way with the right of Grantor to execute and deliver this assignment of Leases and Rents, and to perform all of Grantor's obligations contained in this assignment of Leases and Rents and in the Leases; and (g) To Grantor's knowledge, the Leases are valid, enforceable and in full force and effect. 23.2. Grantor's Covenants. Grantor hereby covenants and agrees to and with Grantee as follows: (a) Grantor will notify Grantee in writing (but without any right of approval or denial on the part of Grantee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement); (b) Grantor hereby acknowledges that any and all Rents collected or received by Grantor after the occurrence of an Event of Default will be the property of Grantee, which if received and collected by Grantor, will be considered received and collected on Grantee's behalf and as Grantee's agent, and will be held by Grantor in trust for the benefit of Grantee, and Grantor will deliver all such sums to Grantee immediately upon Grantor's request therefor; (c) In accordance with sound business judgment, Grantor will use its reasonable best efforts, at its cost and expense, to observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Grantor or its agents under the Leases, and will use its best efforts, in accordance with sound business judgment, to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Grantor will not do or permit to be done anything to impair the security thereof, including without limitation the execution of any other assignment of Grantor's interest in the Leases or the Rents, without Grantee's prior written consent; (d) Grantor authorizes and directs each and every present and future tenant under the Leases to pay all Rent to Grantee upon receipt of written demand from Grantee to so pay the same, and upon paying the same, such tenants will be relieved from all liability to Grantor for such Rent in all respects. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Grantee of the remedies provided for by law or by this assignment of Leases and Rents, the tenant thereunder will, 19 20 upon request of any person succeeding to the interest of Grantor as a result of such enforcement, automatically become the tenant of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month in advance; (e) This assignment of Leases and Rents will not obligate Grantee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Grantor under any Lease, or for the control, care, management, or repair of the Property; nor will it operate to make Grantee responsible or liable for any waste committed on the Property by the tenants or any other parties or for any dangerous or defective condition of the Property, or for any act or omission relating to the management, upkeep, repair, or control of the Property that results in loss or injury or death to any person. Grantee will not be liable for any loss sustained by Grantor resulting from Grantee's failure to lease the Property after default. Grantor will and does hereby indemnify and agree to hold harmless Grantee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this assignment of Leases and Rents and from any and all claims and demands whatsoever which may be asserted against Grantee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases except to the extent the same is caused by the negligence of Grantee. Should Grantee incur any such liability under the Leases or by reason of this assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Grantor will reimburse Grantee therefor immediately upon demand and upon the failure of Grantor so to do, Grantee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Grantor as an advance under the Notes; and (f) This assignment of Leases and Rents is made without prejudice to any of the rights and remedies possessed by Grantee under the Loan Agreement, and the right of Grantee to exercise its remedies under this assignment of Leases and Rents may be exercised by Grantee either prior to, simultaneously with, or subsequent to any action taken by it under the Loan Agreement. Each and every right, remedy and power granted to Grantee by this assignment of Leases and Rents will be cumulative and in addition to any other right, remedy and power given by the Loan Agreement now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this assignment of Leases and Rents, and no act done or omitted by Grantee pursuant to the powers and rights granted it hereunder, nor the failure of Grantee to avail itself of any of the rights and remedies under this assignment of Leases and Rents, will be construed or deemed to be a waiver of any of Grantee's rights and remedies under this assignment of Leases and Rents, nor will such exercise or omission to exercise of the powers and rights granted Grantee hereunder be deemed to constitute a waiver of its rights and remedies under the Loan Agreement. 20 21 23.3. Grantee's Covenants. (a) Although this assignment of Leases and Rents constitutes a present and absolute assignment of the Leases and the Rents, as long as there is no Event of Default on the part of Grantor, Grantee will not require that such Rents be paid directly to Grantee, and Grantor will have a license to collect and use the Rents for subsequent application as provided above; (b) Upon the payment and performance in full of Grantor's obligations under the Loan Agreement, as evidenced by the recording or filing of an instrument of satisfaction or termination of this Indenture without the recording of another security instrument in favor of Grantee affecting the Property, this assignment of Leases and Rents will be deemed terminated and released of record by Grantee and thereupon will be null and void and of no further force or effect. 23.4. Remedies. If any Event of Default occurs, Grantee may, at its option, with or without notice or demand of any kind, exercise any and all of the following remedies: (a) Either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Property, to have, hold, manage, lease and operate the same on such terms and for such period of time as Grantee may deem proper, and either with or without taking possession of the Property in its own name, demand and receive the Rents in the possession of Grantor at the time of Grantee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Grantee, and to apply such Rents to the payment of: (i) all reasonable expenses of managing the Property, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Grantee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Grantee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Property and protecting and preserving the same; or (ii) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Grantee in its sole discretion may determine, any custom or use to the contrary notwithstanding; and (b) In the name of Grantor or of Grantee, institute any legal or equitable action which Grantee in its sole discretion deems desirable to collect and receive any or all of the Rents. Nothing herein contained will be construed to cause Grantee to be a mortgagee in possession nor will Grantee be liable for laches for failure to collect the Rents, and it is understood that Grantee is to account only for such sums as are actually received by Grantee. 23.5. Further Assurances. At Grantee's request, Grantor will assign and transfer to Grantee any and all subsequent Leases upon all or any part of the Property and to 21 22 execute and deliver at the request of Grantee all such further assurances and assignments in the Leases and the Rents as Grantee will require from time to time in its sole discretion. 23.6. Subordination, Nondisturbance and Attornment. The Leases are and at all times shall be subject and subordinate in all respects to this Indenture, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of this Indenture, to the full extent of all principal, interest and all other amounts secured hereby. Provided that a tenant is not in default under its Lease, Grantee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of this Indenture, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided herein, or pursuant to the laws of the State of Georgia. If requested by a tenant under any of the Leases or upon Grantee's request, Grantor shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Grantee) with such tenant whereby Grantee will agree to not disturb the tenant in its possession of the Property provided such tenant is not in default under its Lease and the tenant will agree to attorn to Grantee if Grantee takes possession of the Property. ARTICLE XXIV 24. Security Agreement. (a) This Indenture is hereby made and declared to be a security agreement, encumbering each and every item of personal property included herein, in compliance with the provisions of the Uniform Commercial Code as enacted in the State. A financing statement or statements reciting this Indenture to be a security agreement, affecting all of said personal property aforementioned, shall be executed by Grantor and Grantee and appropriately filed. The remedies for any violation of the covenants, terms and conditions of the security agreement herein contained shall be (i) as prescribed herein, or (ii) as prescribed by general law, or (iii) as prescribed by the specific statutory consequences now or hereafter enacted and specified in said Uniform Commercial Code, all at Grantee's sole election. Grantor and Grantee agree that the filing of such financing statement(s) in the records normally having to do with personal property shall never be construed as in any way derogating from or impairing this declaration and hereby stated intention of Grantor and Grantee that everything used in connection with the production of income from the Property and/or adapted for use therein and/or which is described or reflected in this Indenture, is, and at all times and for all purposes and in all proceedings both legal or equitable shall be, regarded as part of the Property irrespective of whether (i) any such item is physically attached to the Improvements, (ii) serial numbers are used for the better identification of certain items capable of being thus identified in a recital contained herein, or (iii) any such item is referred to or reflected in any such financing statement(s) so filed at any time. Similarly, the mention in any such financing statement(s) of the rights in and to (aa) the proceeds of any fire and/or hazard insurance policy, or (bb) any award in eminent domain proceeds for a taking or for loss of value, or (cc) Grantor's interest as lessor in any present or future lease or rights to income growing out of the use and/or 22 23 occupancy of the Property, whether pursuant to lease or otherwise shall never be construed as in anyway altering any of the rights of Grantee as determined by this instrument impugning the priority of Grantee's estate granted hereby or by any other recorded document, but such mention in such financing statement(s) is declared to be for the protection of Grantee in the event any court shall at any time hold with respect to the foregoing (aa), (bb) or (cc), that notice of Grantee's priority of interest to be effective against a particular class of persons, must be filed in the Uniform Commercial Code records. (b) Grantor warrants that (i) Grantor's (that is "Debtor's") name, identity or corporate structure and residence or principal place of business are as set forth in Exhibit C hereto; (ii) Grantor (that is, "Debtor") has been using or operating under said name, identity or corporate structure without change for the time period set forth in Exhibit C hereto; and (iii) the location of the collateral is upon the Property. Grantor covenants and agrees that Grantor will furnish Grantee with notice of any change in the matters addressed by clauses (i) or (iii) of this subparagraph (b) within thirty (30) days of the effective date of any such change and Grantor will promptly execute any financing statements or other instruments deemed necessary by Grantee to prevent any filed financing statement from becoming misleading or losing its perfected status. ARTICLE XXV 25. Waiver of Homestead. Grantor hereby waives and renounces all homestead and exemption rights provided for by the Constitution and laws of the United States and of any state, in and to the Property as against the collection of the secured obligations, or any part hereof. ARTICLE XXVI 26. WAIVER OF GRANTOR'S RIGHTS. BY EXECUTION OF THIS INDENTURE, GRANTOR EXPRESSLY: (A) ACKNOWLEDGES THE RIGHT TO ACCELERATE THE INDEBTEDNESS SECURED HEREBY AND THE POWER OF ATTORNEY GIVEN HEREIN TO GRANTEE TO SELL THE PROPERTY BY NONJUDICIAL FORECLOSURE UPON DEFAULT BY GRANTOR WITHOUT ANY JUDICIAL HEARING AND WITHOUT ANY NOTICE OTHER THAN SUCH NOTICE (IF ANY) AS IS SPECIFICALLY REQUIRED TO BE GIVEN UNDER THE PROVISIONS OF THIS INDENTURE; (B) WAIVES ANY AND ALL RIGHTS WHICH GRANTOR MAY HAVE UNDER THE CONSTITUTION OF THE UNITED STATES (INCLUDING THE FIFTH AND FOURTEENTH AMENDMENTS THEREOF, THE VARIOUS PROVISIONS OF THE CONSTITUTIONS FOR THE SEVERAL STATES, OR BY REASON OF ANY OTHER APPLICABLE LAW), (1) TO NOTICE AND JUDICIAL HEARING PRIOR TO THE EXERCISE BY GRANTEE OF ANY RIGHT OR REMEDY HEREIN PROVIDED TO GRANTEE EXCEPT SUCH NOTICE (IF ANY) AS IS SPECIFICALLY REQUIRED TO BE PROVIDED IN THIS INDENTURE; AND (2) CONCERNING THE APPLICATION, RIGHTS OR BENEFITS OF ANY MORATORIUM, REINSTATEMENT, MARSHALING, 23 24 FORBEARANCE, APPRAISEMENT, VALUATION, STAY, EXTENSION, HOMESTEAD, EXEMPTION OR REDEMPTION LAWS; (C) ACKNOWLEDGES THAT GRANTOR HAS READ THIS INDENTURE AND ANY AND ALL QUESTIONS REGARDING THE LEGAL EFFECT OF THIS INDENTURE AND ITS PROVISIONS HAVE BEEN EXPLAINED FULLY TO GRANTOR AND GRANTOR HAS CONSULTED WITH COUNSEL OF GRANTOR'S CHOICE PRIOR TO EXECUTING THIS INDENTURE; AND (D) ACKNOWLEDGES THAT ALL WAIVERS OF THE AFORESAID RIGHTS OF GRANTOR HAVE BEEN MADE KNOWINGLY, INTENTIONALLY AND WILLINGLY BY GRANTOR AS PART OF A BARGAIN FOR THE LOAN TRANSACTION AND THAT THIS INDENTURE IS VALID AND ENFORCEABLE BY GRANTEE AGAINST GRANTOR IN ACCORDANCE WITH ALL THE TERMS AND CONDITIONS HEREOF. ARTICLE XXVII 27. Approval of Legal Description. Grantor has read and does hereby approve the legal description of the Land which Is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Grantee and its attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XXVIII 28. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Indenture and the Loan Agreement, the Loan Agreement shall control. ARTICLE XXIX 29. WAIVER OF JURY TRIAL. GRANTOR AND GRANTEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER GRANTOR NOR GRANTEE, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS DEED TO SECURE DEBT, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN GRANTOR AND GRANTEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY GRANTOR AND GRANTEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR GRANTEE TO MAKE THE LOAN TO GRANTOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. 24 25 IN WITNESS WHEREOF, Grantor has caused this Indenture to be executed, sealed, and attested by its proper officers thereunto duly authorized, as of the day and year first above written. Signed, sealed and delivered in the KOGER EQUITY, INC., a Florida presence of: corporation /s/ Janice R. Long By: /s/ G. Danny Edwards - ----------------------------------- ------------------------------------- Unofficial Witness Name: G. Danny Edwards ---------------------------------- Title: Treasurer ---------------------------------- /s/ Dee Price - ----------------------------------- Notary Public Attest: /s/ W. Lawrence Jenkins --------------------------------- Name: W. Lawrence Jenkins ----------------------------------- Title: Corporate Secretary --------------------------------- My Commission Expires: Feb. 1, 1999 [CORPORATE SEAL] Notary Public, Camden County, Georgia - ------------------------------------- [NOTARY SEAL] 25 26 EXHIBIT A The Land 27 EXHIBIT B Permitted Encumbrances 28 EXHIBIT C DEBTOR NAME: Koger Equity, Inc. CORPORATE STRUCTURE: a Florida corporation PRINCIPAL PLACE OF BUSINESS: 3986 Boulevard Center Drive #101 Jacksonville, Florida 32207 TIME PERIOD USING NAME WITHOUT CHANGE June 21, 1988, to present SECURED PARTY NAME: First Union National Bank, as Agent for the Lenders PRINCIPAL PLACE OF BUSINESS: 301 South College Street Charlotte, North Carolina 28288 EX-10.(K)(4)(B)(II) 17 ASSIGNMENT OF LEASES AND RENTS 1 EXHIBIT 10(k)(4)(b)(ii) THIS INSTRUMENT PREPARED BY AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ASSIGNMENT OF LEASES AND RENTS THIS ASSIGNMENT OF LEASES AND RENTS (this "Assignment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee"), for the Lenders under that certain Second Amended and Restated Revolving Credit Loan Agreement (the "Loan Agreement"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. Capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Agreement. R E C I T A L S: A. Assignor is the grantor under that certain Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement given by Assignor to Assignee dated of even date herewith and recorded or to be recorded in the public records of Gwinnett County, Georgia (the "Deed to Secure Debt"); securing the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes"), encumbering certain real property interests located in Gwinnett County, Georgia, as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Assignment for the purposes set forth herein. 1 3 NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title and interest in, to and under any and all present and future leases of or in the Premises ("Leases") and any and all rents, revenues, issues and profits (including Assignor's interest in any security deposits relating thereto) arising out of or accruing from the Leases whether now or hereafter due ("Rents"), said Leases and Rents being deemed part of the security for the indebtedness herein mentioned and are encumbered, transferred and conveyed by this Assignment, and in furtherance thereof, does hereby covenant and agree with Assignee as follows: 1. Assignor will notify Assignee in writing (but without any right of approval or denial on the part of Assignee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement). 2. Assignor will, at its cost and expense, observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Assignor or its agents under the Leases, and will use its reasonable best efforts in the exercise of sound business judgment to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Assignor will not do or permit to be done anything to impair the security hereof, including without limitation the execution of any other assignment of Assignor's interest in the Leases or the Rents, without Assignee's prior written consent. 3. This Assignment is intended to operate as an absolute and immediate assignment of the Leases and the Rents; however, unless and until a default occurs under the Notes, the Loan Agreement, the Deed to Secure Debt or this Assignment, Assignor will have a license to collect the Rents as and when the same become due and payable. Assignor hereby agrees that the respective tenants under the Leases, upon notice from Assignee of the occurrence of a default hereunder, will thereafter pay to Assignee the Rents due and to become due under the Leases without any obligation to determine whether or not such a default does in fact exist. Assignor, without written approval of Assignee, will not collect or accept Rent for more than one (1) month in advance; provided, however, Assignor may accept Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month. 4. Upon payment in full of the principal sum and interest, of the Notes, this Assignment shall become and be void and of no effect. Assignor hereby authorizes and 2 4 directs the lessees named in said Leases or any other or future lessees or occupants of the Premises described therein or in the Deed to Secure Debt upon receipt from the Assignee of written notice to the effect that Assignee is then the holder of the Notes and the Deed to Secure Debt and that a default exists thereunder or under the Assignment, to pay over to the Assignee all rents, income, profits and revenues hereby assigned and to continue so to do until otherwise notified by Assignee. 5. This Assignment of Leases and Rents as provided herein will not be deemed or construed to constitute Assignee as a mortgagee in possession of the Premises nor to obligate Assignee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Assignor under any Lease, or for the control, care, management, or repair of the Premises; nor will it operate to make Assignee, except in the event of Assignee's negligence, recklessness or wilful misconduct, responsible or liable for any waste committed on the Premises by the tenants or any other parties or for any dangerous or defective condition of the Premises, or for any act or omission relating to the management, upkeep, repair, or control of the Premises that results in loss or injury or death to any person. Except in the event of Assignee's negligence, recklessness or wilful misconduct, Assignee will not be liable for any loss sustained by Assignor resulting from Assignee's failure to lease the Premises after default or from any other act or omission of Assignee in managing the Premises after default. Assignor will and does hereby indemnify and agree to hold harmless Assignee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this Assignment of Leases (except as a result of Assignee's gross negligence or wilful misconduct) and, to the extent that a claim is made against Assignee prior to the time Assignee takes possession of the Premises, from any and all claims and demands whatsoever which may be asserted against Assignee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases. Should Assignee incur any such liability under the Leases or by reason of this Assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Assignor will reimburse Assignee therefor immediately upon demand and upon the failure of Assignor so to do, Assignee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Assignor as an advance under the Notes and secured by this Assignment. 6. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Assignee of the remedies provided for by law or by the Notes, the Deed to Secure Debt or this Assignment, the lessee thereunder will, upon request of any person succeeding to the interest of Assignor as a result of such enforcement, automatically become the lessee of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month or two (2) months in advance (as applicable in accordance with Paragraph 3 above). The Leases are and at all times shall be subject and subordinate in all respects to the Deed to 3 5 Secure Debt, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of the Deed to Secure Debt, to the full extent of all principal, interest and all other amounts secured thereby. Provided that a tenant is not in default under its Lease, Assignee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of the Deed to Secure Debt, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided in the Deed to Secure Debt, or pursuant to the laws of the State of Georgia. If requested by a tenant or Assignor under any of the Leases or upon Assignee's request, Assignor and Assignee shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Assignee) with such tenant whereby Assignee will agree to not disturb the tenant in its possession of the Premises provided such tenant is not in default under its Lease and the tenant will agree to attorn to Assignee if Assignee takes possession of the Premises. 7. Upon a default under the Notes, the Loan Agreement, the Deed to Secure Debt or this Assignment, Assignee may at its option, without notice and without regard to the adequacy of the security for the obligations set forth in the Notes, either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Premises, to have, hold, manage, lease and operate the same on such terms and for such period of time as Assignee may deem proper, and either with or without taking possession of the Premises in its own name, demand and receive the Rents in the possession of Assignor at the time of Assignee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Assignee, and to apply such Rents to the payment of: (a) all reasonable expenses of managing the Premises, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Assignee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Assignee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Premises and protecting and preserving the same; or (b) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Assignee in its sole discretion may determine, any custom or use to the contrary notwithstanding. 8. This Assignment is made and accepted without prejudice to any of the rights and remedies possessed by Assignee under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed to Secure Debt, and the right of Assignee to exercise its remedies under this Assignment may be exercised by Assignee either prior to, simultaneously with, or subsequent to any action taken by it under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed to Secure Debt. Each and every right, remedy and power granted to Assignee by this Assignment will be cumulative and in addition to any other right, remedy and power given by the remaining terms and conditions of the Notes, the Loan Agreement, the Deed to Secure Debt or this Assignment, or now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing 4 6 contained in this Assignment, and no act done or omitted by Assignee pursuant to the powers and rights granted it hereunder, nor the failure of Assignee to avail itself of any of the rights and remedies under this Assignment, will be construed or deemed to be a waiver of any of Assignee's rights and remedies under this Assignment, nor will such exercise or omission to exercise of the powers and rights granted Assignee hereunder be deemed to constitute a waiver of its rights and remedies under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed to Secure Debt. 9. Assignee may take or release other security for the payment of the indebtedness under the Notes and the Deed to Secure Debt, may release any party primarily or secondarily liable therefor, and may apply any other security held by it to the satisfaction of such indebtedness without prejudice to any of its rights under this Assignment. 10. The term "Lease" or "Leases" as used herein, means said Leases hereby assigned or any extension or renewal thereof, and any leases subsequently executed during the term of this Assignment covering the Premises or any part thereof. At Assignee's request, Assignor will assign and transfer to Assignee any and all subsequent leases upon all or any part of the Premises and to execute and deliver at the request of Assignee all such further assurances and assignments in the Premises as Assignee will require from time to time in its sole discretion. 11. This Assignment, together with the covenants and warranties therein contained, shall inure to the benefit of Assignee and any subsequent holder of the Notes and the Deed to Secure Debt shall be binding upon Assignor, their successors, executors, personal representatives, and assigns, and any subsequent owner of the Premises. 12. This Assignment shall expire and terminate upon the payment in full of the Notes and any other Indebtedness secured by the Deed to Secure Debt and any cancellation, satisfaction or release of the Deed to Secure Debt shall constitute a cancellation, satisfaction, or release of this Assignment. In the event that a specific property is released from the lien of the Deed to Secure Debt, then such property and the Leases relating to it shall, effective with the release, also be released from this Assignment. 13. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, 5 7 VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. 6 8 IN WITNESS WHEREOF, Assignor has executed this Assignment under seal the day and year first above written. Signed, sealed and delivered in ASSIGNOR: the presence of: KOGER EQUITY, INC., a Florida corporation /s/ Alan C. Sheppard, Jr. - ---------------------------------------- Unofficial Witness Alan C. Sheppard, Jr. By: /s/ G. Danny Edwards ---------------------- ---------------------------- Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- Attest: /s/ W. Lawrence Jenkins ------------------------ Name: W. Lawrence Jenkins -------------------------- Title: Corporate Secretary ------------------------- [AFFIX CORPORATE SEAL] /s/ Dee Price - ---------------------------------------- Notary Public My Commission Expires: February 1, 1999 Notary Public, Camden County, Georgia - ---------------------------------------- [Notary Seal] 7 9 EXHIBIT A LEGAL DESCRIPTION OF PREMISES 8 EX-10.(K)(4)(B)(III) 18 ENVIRONMENTAL INDEMNIFICATION AGREEMENT 1 EXHIBIT 10(k)(4)(b)(iii) ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ENVIRONMENTAL INDEMNIFICATION AGREEMENT THIS ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Agreement") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("FUNB"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined) (FUNB and such Lenders are collectively referred to herein as the "Lenders"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group, which terms Borrower and Lenders, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. R E C I T A L S : A. Borrower has obtained financing from Lenders pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan Agreement") and those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan"). B. Borrower's obligations under the Loan are secured in part by a Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement in favor of Lenders (the "Deed to Secure Debt") encumbering real property located in Gwinnett County, Georgia, and being more particularly described on attached Exhibit A (the "Property"). C. As a condition precedent to and as a material inducement for Lenders' agreement to provide the Loan to Borrower, Lenders have required Borrower to execute and deliver this Agreement, it being acknowledged and understood by Borrower that Lenders otherwise are not willing to make or provide the Loan. D. Borrower has obtained a Phase I Environmental Site Assessment dated December 4, 1998, prepared by Turner Hart & Hickman, P.C. (the "Environmental 1 3 Assessment"), and has delivered a copy of the same to Lenders. Lenders intend to rely on the Environmental Assessment in making the Loan. NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and as a material inducement to Lenders to make or provide the Loan to Borrower, Borrower hereby covenants and agrees with Lenders as follows: 1. Definitions. The following terms as used in this Agreement will have the meanings set forth below: (a) "Hazardous Substances" will mean any hazardous or toxic substances, materials or wastes, including without limitation any flammable explosives, radioactive materials, friable asbestos, kepone, polychlorinated biphenyls (PCB's), electrical transformers, batteries, paints, solvents, chemicals, petroleum products, or other man-made materials with hazardous, carcinogenic or toxic characteristics, and such other solid, semi-solid, liquid or gaseous substances which are radioactive, toxic, ignitable, corrosive, carcinogenic to human health, those substances, materials, and wastes listed in the United States Department of Transportation Table (49 CFR 972.101) or by the Environmental Protection Agency, as hazardous substances (40 CFR Part 302, and amendments thereto) provided all such substances, materials and wastes are or become regulated under applicable local, state or federal law relating to (i) petroleum, (ii) asbestos, (iii) PCB's, or (iv) materials designated as a "hazardous substance," "hazardous waste," "hazardous materials," "toxic substances," "contaminants," in each case under any applicable Environmental Laws. (b) "Environmental Laws" will mean any applicable present or future federal, state or local laws, ordinances, rules or regulations pertaining to Hazardous Substances, including without limitation the following statutes and regulations, as amended from time to time: (i) the Federal Clean Air Act, 42 U.S.C. Section 7401 et seq.; (ii) the Federal Clean Water Act, 33 U.S.C. Section 1151 et seq.; (iii) the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. ("RCRA"); (iv) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq. ("CERCLA") and the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499, 100 Stat. 1613 ("SARA"); (v) the Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; (vi) the National Environment Policy Act, 42 U.S.C. Section 1857 et seq.; (vii) The Toxic Substance Control Act of 1976, 15 U.S.C. Section 2601 et seq.; (viii) applicable regulations of the Environmental Protection Agency, 33 CFR and 40 CFR relating to hazardous substances; and (ix) and similar statutes, rules and regulations under the laws of the State of Georgia. (c) "Hazardous Condition" will mean the presence, discharge, disposal, storage or release of any Hazardous Substance, in violation of any Environmental Laws, on or in 2 4 the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or that migrates, flows, percolates, diffuses or in any way moves onto or into the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or from the Property into adjacent property. (d) "Claims" will mean, individually and collectively, any claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses (including reasonable attorneys' and paralegals' fees and costs, whether incurred in enforcing this Agreement, collecting any sums due hereunder, settlement negotiations, at trial or on appeal), reasonable consultant fees and reasonable expert fees, together with all other reasonable costs and expenses of any kind or nature, that arise directly from or in connection with the existence of a Hazardous Condition, whether occurring before, on or after the date of this Agreement or caused by any person or entity. Without limiting the generality of the foregoing definition, Claims specifically will include claims, whether by related or third parties, for personal injury or real or personal property damage, and capital, operating and maintenance costs incurred in connection with any Remedial Work. However, notwithstanding the foregoing, Claims will not be deemed to include claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses, that arise in connection with any Hazardous Condition that is determined by proper judicial or administrative procedure to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, foreclosure or deed in lieu of foreclosure, or which is caused by the actions of Lenders. (e) "Remedial Work" will mean any investigation or monitoring of site conditions, any clean-up, containment, remediation, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person due to the existence of a Hazardous Condition. 2. Compliance with Environmental Laws; Disclosure of Hazardous Conditions. Except as to those conditions (the "Existing Conditions") as specifically may be disclosed in the Environmental Assessment, Borrower hereby represents, warrants, covenants and agrees in all material respects to and with Lenders that all operations or activities upon, or any use or occupancy of the Property by Borrower, any tenant or other occupant, to the best of Borrower's knowledge, is presently and will at all times until Borrower's conveyance of the Property or foreclosure of Deed to Secure Debt be in compliance with all Environmental Laws; that Borrower has not at any time engaged in or permitted, nor has any existing or previous tenant or occupant of the Property engaged in or permitted to the best of Borrower's knowledge the occurrence of any Hazardous Condition, except as 3 5 specifically may be disclosed in the Environmental Assessment; and that to the best of Borrower's knowledge, there does not now exist nor is there suspected to exist any Hazardous Condition on or about the Property, except as specifically may be disclosed in the Environmental Assessment. 3. Indemnification. Borrower hereby indemnifies and agrees to protect, defend and hold Lenders harmless, which for purposes of this paragraph will be deemed to include the directors, officers, shareholders, employees and agents of Lenders, from and against any Claims other than claims arising from Lenders' or such other included parties' gross negligence or willful misconduct, including, without limitation, any claims relating to an Existing Condition. In the event that Lenders suffer or incur any Claims, Borrower will pay to Lenders the total of all such Claims suffered or incurred by Lenders upon demand therefor by Lenders. 4. Remedial Work. In the event that any Remedial Work with respect to any Hazardous Conditions that could result in a Claim is required under any Environmental Laws by any judicial order, or by any governmental entity, or in order to comply with the terms, covenants and conditions of this Agreement or of any other agreements affecting the Property, Borrower will perform or cause to be performed the Remedial Work in compliance with such law, regulation, order or agreement. All Remedial Work will be performed by one or more contractors, selected by Borrower and under the supervision of a consulting environmental engineer selected by Borrower, and approved in advance by Lenders. All costs and expenses of Remedial Work will be paid by Borrower including without limitation the charges of such contractor(s) and the consulting environmental engineer, and Lenders' reasonable attorneys' and paralegals' fees and costs incurred in connection with monitoring or review of all Remedial Work. In the event that Borrower fails to timely commence, or cause to be commenced, or fails to diligently prosecute to completion, such Remedial Work, Lenders may, but will not be required or have any obligation to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith, will thereupon constitute Claims. All such Claims will be due and payable by Borrower upon demand therefor by Lenders. 5. Permitted Contests. Notwithstanding any provision of this Agreement to the contrary, provided that (i) no default has occurred and is continuing under the Loan Agreement, (ii) no Lenders nor any assignee of any Lenders' interest (including any person having a beneficial interest) in the Property, the Loan and the Loan Documents will be exposed or subjected to civil or criminal liability, and (iii) the lien and security interest of Lenders or any such assignee in the Property, the Loan, the Loan Documents, or the payment of any sums to be paid under the Loan Documents, is not jeopardized or in any way adversely affected, Borrower may contest or cause to be contested, by appropriate action, the application, interpretation or validity of any Environmental Laws or any agreement requiring any Remedial Work pursuant to a good faith dispute regarding such application, interpretation or validity of such Environmental Laws or agreement requiring 4 6 such Remedial Work. During the pendency of any such permitted contest, Borrower may delay performance of Remedial Work or compliance with the Environmental Laws or agreement requiring such Remedial Work, provided that (i) Borrower actually contests and prosecutes such contest by appropriate proceedings conducted in good faith and with due diligence to resolution, (ii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have given Lenders written notice that Borrower intends to contest or will contest or cause to be contested the same, and will have given such security or assurances as Lenders reasonably may request to ensure compliance with the legal requirements pertaining to the Remedial Work (and payment of all costs, expenses, interest and penalties in connection therewith) and to prevent any sale, forfeiture or loss of all or any part of the Property by reason of such noncompliance, delay or contest, and (iii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have taken such steps as may be necessary to prevent or mitigate any continuing occurrence of any existing or suspected Hazardous Condition giving rise to the contested Remedial Work requirement. Subject to the terms and conditions set forth above, during the pendency of any such permitted contest resulting in a delay of performance of any required Remedial Work, Lenders agree that it will not perform such Remedial Work requirement on behalf of Borrower. 6. Subrogation of Indemnity Rights. If Borrower fails to perform its obligations under paragraphs 3 and 4 above, Lenders will be subrogated to any rights Borrower may have under any indemnifications from any present, future or former owners, tenants or other occupants or users of the Property relating to the matters covered by this Agreement. 7. Assignment by Lenders. No consent by Borrower will be required for any assignment or reassignment of the rights of Lenders hereunder to one or more purchasers of the Loan, the Loan Documents or Lenders' interest in the Property under the Deed to Secure Debt. 8. Merger, Consolidation or Sale of Assets. Subject to limitations regarding disposition of any interest or control in Borrower as may be set forth in the Loan Documents, in the event of a disposition involving Borrower or all or a substantial portion of the assets of Borrower to one or more persons or other entities or the merger or consolidation of Borrower with another entity, the surviving entity or transferee of assets, as the case may be, will (i) be formed and existing under the laws of a state, district or commonwealth of the United States of America, and (ii) deliver to Lenders an acknowledged instrument in recordable form assuming all obligations, covenants and responsibilities of Borrower under this Agreement. 9. Survival; Independent Obligations. Notwithstanding anything to the contrary contained in the Loan Agreement, the obligations of Borrower under this Agreement will 5 7 survive (a) the consummation of the Loan transaction described above; (b) satisfaction of all terms and conditions to be performed by or on behalf of Borrower under the Loan Agreement; (c) termination, in accordance with their respective terms, of the Loan transaction and the Loan Agreement; (d) any assumption of Borrower's obligations under the Loan Agreement by a successor to Borrower (whether or not Lenders approved such assumption and whether or not Borrower was released from liability under the Loan Agreement); (e) conveyance of title to all or any portion of the Property to any third party, and subsequent reconveyance of all or any portion of the Property by any such third party to subsequent transferees; and (f) conveyance of title to the Property to Lenders through power of sale, process of foreclosure, or by conveyance in lieu of foreclosure of the Deed to Secure Debt; provided, however, that Borrower will not be liable for damages resulting from Hazardous Conditions which are determined either by a written agreement or stipulation between Borrower and Lenders or, if Borrower and Lenders are unable to agree or stipulate, a final judicial or administrative action (after all available appeals have been taken or waived) to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, power of sale, process of foreclosure, or deed in lieu of foreclosure; provided, however, that the obligations of Borrower under this Agreement will finally cease and terminate upon the final expiration of any applicable statute of limitation of actions as to any potential Claim. The obligations of Borrower under this Agreement are separate and distinct from the obligations of Borrower under the Loan Agreement. This Agreement may be enforced by Lenders without regard to any other rights and remedies Lenders may have against Borrower under the Loan Agreement and without regard to any limitations on Lenders' recourse as may be provided in the Loan Agreement; provided, however, that a default by Borrower under this Agreement will constitute a default under the Loan Agreement. Enforcement of this Agreement will not be deemed to constitute an action for recovery of Borrower's indebtedness under the Loan Agreement nor for recovery of a deficiency judgment against Borrower following exercise of Borrower's remedies under the Deed to Secure Debt. Borrower expressly and specifically agrees that Lenders may bring and prosecute a separate action or actions against Borrower hereunder whether or not Lenders have brought an action against Borrower under the Loan Agreement. 10. Default Interest. Any Claims and other payments required to be paid by Borrower to Lenders under this Agreement which are not paid on demand therefor will thereupon be considered "Delinquent," and will result in and constitute a default hereunder. In addition to all other rights and remedies of Lenders against Borrower as provided herein, or under applicable law, Borrower will pay to Lenders, immediately upon demand therefor, Default Interest (as defined below) on any such payments which are or have become Delinquent. Default Interest will be paid by Borrower from the date such payment becomes Delinquent through and including the date of payment of such Delinquent sums. As used herein, "Default Interest" will be equal to the rate of interest charged for a payment default 6 8 under the Loan Agreement, but in any event not to exceed the maximum rate of interest permitted to be contracted for under Georgia law. Borrower expressly and specifically agrees that any Default Interest charged to Borrower hereunder will in no manner or respect constitute a penalty or interest under the Loan Agreement, with the express understanding that this Agreement and Borrower's obligations hereunder constitute separate obligations of Borrower independent of the Loan Agreement. 11. Administrative Agent for Lenders. The Lenders have appointed FUNB to act as administrative agent on behalf of all of the Lenders in connection with the Loan. Accordingly, FUNB shall be entitled to exercise the rights and remedies of the Lenders hereunder as agent for each of the Lenders. Any notice provided by FUNB to the Borrower shall be deemed provided to Borrower by each of the Lenders, and any notice from Borrower which states it is to FUNB as agent for the Lenders hereunder, shall be deemed to be given to each of the Lenders. 12. Miscellaneous. If there is more than one party executing this Agreement as an indemnitor, each such party agrees that (i) the obligations of Borrower hereunder are joint and several, (ii) a release of any one or more such parties or any limitation of this Agreement in favor of or for the benefit of one or more such parties will not in any way be deemed a release of or limitation in favor of or for the benefit of any other party, and (iii) a separate action hereunder may be brought and prosecuted against one or more such parties. If any term of this Agreement or any application thereof will be invalid, illegal or unenforceable, the remainder of this Agreement and any other application of such term will not be affected thereby. No delay or omission in exercising any right hereunder will operate as a waiver of such right or any other right. This Agreement will be binding upon, inure to the benefit of and be enforceable by Borrower and Lenders, and their respective successors and assigns. This Agreement will be governed and construed in accordance with the laws of the State of Georgia. The parties hereby stipulate that jurisdiction and venue for purposes of enforcement of this Agreement and adjudication of the respective rights and obligations of the parties shall be in the Georgia circuit court in the judicial circuit in which the Property is located. 13. Conflict. In the event of conflict between the terms and conditions hereunder and the terms and conditions of the Loan Agreement, the terms and conditions of the Loan Agreement will govern. 14. Waiver of Defenses. In any action, suit or proceeding relating to this Agreement, Borrower and Lenders waive the right to interpose a defense of laches, failure of consideration or mutuality of remedy. 7 9 IN WITNESS WHEREOF, Borrower and Lenders have executed this Agreement as of the date first above written. BORROWER: Signed, sealed and delivered KOGER EQUITY, INC., a Florida in the presence of: corporation /s/ Janice R. Long /s/ Dee Price By: /s/ G. Danny Edwards - --------------------------------------- ---------------------------- Witness Name: G. Danny Edwards -------------------------- Title: Treasurer ------------------------- Attest: /s/ W. Lawrence Jenkins ------------------------ Name: W. Lawrence Jenkins -------------------------- /s/ Dee Price Title: Corporate Secretary - --------------------------------------- ------------------------- Notary Public [CORPORATE SEAL] My Commission Expires: February 1, 1999 Notary Public, Camden County, Georgia - --------------------------------------- [NOTARY SEAL] 8 10 LENDER: Signed, sealed and delivered in the presence of: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan C. Sheppard, Jr. - --------------------------------------- Witness Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead -------------------------- Name: J. Andrew Hogshead ------------------------ Title: Vice President ----------------------- Attest:/s/ Lynn Vermilva ---------------------- /s/ Alan C. Sheppard, Jr. Name: Lynn Vermilva - --------------------------------------- ----------------------- Notary Public Alan C. Sheppard, Jr. Title: Vice President ----------------------- My Commission Expires: Sept. 3, 2000 [CORPORATE SEAL] My Commission # CC 578946 Bonded Thru Notary Public Underwriters - --------------------------------------- [NOTARY SEAL] 9 11 EXHIBIT A DESCRIPTION OF PROPERTY EX-10.(K)(5)(A)(I) 19 2ND AMEND & RESTATED DEED OF TRUST 1 THIS INSTRUMENT PREPARED BY, EXHIBIT 10(k)(5)(a)(i) AND FOLLOWING RECORDING RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, Florida 32202 SECOND AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO TRESTE, INC., AS TRUSTEE Dated as of December 30, 1998 State: North Carolina Section: Township: Range: County: Guilford Tax I.D.: 2 SECOND AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT THIS SECOND AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT (this "Indenture"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose mailing address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to TRESTE, INC., a Virginia corporation authorized to do business in North Carolina ("Trustee") having an address c/o First Union National Bank, a national association, 301 South College Street, Charlotte, North Carolina 28288, as trustee for the benefit of FIRST UNION NATIONAL BANK, a national association, as Agent (the "Beneficiary") on behalf of the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, the Beneficiary's mailing address is One First Union Center, 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. Capitalized terms not otherwise defined herein are defined in Article I. This Indenture amends and restates that certain Amended and Restated Deed of Trust and Security Agreement (the "Prior Indenture") recorded in Official Records Book 4630, Page 099, of the public records of Guilford County, North Carolina, which Prior Indenture was assigned to Beneficiary, pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith to be recorded in the public records of Guilford County, North Carolina (the "Assignment"). W I T N E S S E T H : THIS INDENTURE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Borrower and all indebtedness heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other indebtedness which this Indenture by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to each of the Lenders, (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the 1 3 4 maximum aggregate principal amount of indebtedness secured hereby, other than for advances made pursuant to Article XXV, Paragraph 25 hereof, shall in no event exceed $150,000,000.00 (the "Indebtedness") and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, in consideration of the aforesaid Indebtedness and the trust referred to and created below, Borrower hereby irrevocably grants, bargains and sells, conveys, transfers, assigns, sets over, hypothecates, pledges and grants to Trustee and its successors and assigns IN TRUST WITH POWER OF SALE in and to all of Borrower's right, title and interest in the following property and rights whether now owned or hereafter acquired by Borrower (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the "Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) all fixtures, machinery, equipment and other personal property of all types owned by Borrower now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Borrower's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Indebtedness; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and 2 5 (viii) the right, in the name and on behalf of Borrower, to appear in and defend any action or proceeding brought with respect to Borrower's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Beneficiary in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property unto Trustee and its successors and assigns, forever; IN TRUST NEVERTHELESS to its own proper use and benefit forever, upon the terms and trusts herein set forth for the benefit and security of Beneficiary. This Indenture is a deed of trust of real property and a security agreement covering the Fixtures under the Uniform Commercial Code of the State. Upon the occurrence of an Event of Default, Trustee and Beneficiary shall, in addition to other rights and remedies granted to them, have all the rights granted to secured parties pursuant to the Uniform Commercial Code of the State. Borrower, for itself and for its successors and assigns, covenants and agrees with Trustee and with Beneficiary as follows: ARTICLE I 1. Definitions. As used in this Indenture, the following capitalized terms have the respective meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Beneficiary" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Borrower" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. 3 6 "Event of Default" shall have the meaning assigned to such term in Article V of this Indenture. "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in clause (iv) of the Granting Clause of this Indenture. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Borrower, Beneficiary or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in clause (ii) of the Granting Clause of this Indenture. "Indebtedness" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Indenture" shall mean this Second Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement. "Land" shall mean those certain parcels of real property located in the County of Guilford, State of North Carolina, as more particularly described on Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "Lenders" shall mean FUNB, GFB, AmSouth, Citizens, and Compass, and any other Lenders under the Credit Agreement from time to time. 4 7 "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 between Borrower and Beneficiary. "Loan Documents" shall mean collectively, the Notes, the Loan Agreement, this Indenture, and the Security Deeds, the Assignments of Leases, the Assignments of Contracts, the Indemnification Agreements, as such terms are defined in the Loan Agreement and any and all other loan documents executed in connection with the Loan. "Notes" shall mean collectively (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of FUNB in the principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Compass in the original principal amount of $15,000,000. "Other Indenture" shall mean any mortgage, deed to secure debt, or deed of trust given by Borrower to or in favor of Trustee or Beneficiary to secure the Indebtedness, other than this Indenture. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Rents" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "State" shall mean the State of North Carolina. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as 5 8 the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. "Trustee" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. ARTICLE II 2. Representations and Warranties. Borrower represents and warrants to Trustee for the benefit of Beneficiary that (a) it has full power, authority and legal right to execute and deliver this Indenture and to grant a first deed of trust of the Property, (b) it holds good and marketable fee simple title to the Land and good and marketable title to the balance of the Property, (c) this Indenture constitutes a valid first deed of trust of the Property, subject to the Permitted Encumbrances, and (d) the Leases are in full force and effect in accordance with their respective terms, have not been canceled or modified, and have not been assigned or encumbered except to Beneficiary pursuant to this Indenture and the Loan Agreement, and, to the best of Borrower's knowledge, no default exists under the Leases. Borrower, at its expense, will warrant to Trustee and to Beneficiary and will defend its title to the Property and the lien thereon created by this Indenture against all claims and demands, and will maintain and preserve such lien so long as the Indebtedness secured by this Indenture remains outstanding, subject, however, to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Indenture and the lien created hereby shall terminate in accordance with Article XIX, Borrower shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Indenture and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the lien of this Indenture as a first lien on the Property and the rights of Trustee and Beneficiary hereunder. Borrower shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance. (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end. 6 9 (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the same shall be contested in good faith and by appropriate proceedings by Borrower in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that the Borrower is otherwise in compliance with the Loan Agreement. Upon the written request of Beneficiary from time to time, Borrower will furnish to Beneficiary official receipts or other satisfactory proof evidencing such payments. In addition, Borrower will pay all utility charges as required by the Loan Agreement. Borrower shall not be entitled to any credit on the Indebtedness, by reason of the payment of any Imposition or utility charges or any part thereof. (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Borrower in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvement and the Fixtures, or any part of either thereof. (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Beneficiary any certificates or evidence of such insurance as required under the Loan Agreement. (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Borrower shall give immediate written and oral notice thereof to Beneficiary and Trustee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Beneficiary shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Borrower would be entitled thereto under the Loan Agreement, and Borrower hereby irrevocably assigns to Beneficiary all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Borrower will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Beneficiary. At the sole cost and expense of Borrower, Beneficiary may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Beneficiary in connection with, any claim or the claims payment process. Borrower will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Beneficiary shall be applied in accordance with the provisions of the Loan Agreement. 7 10 (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Trustee and Beneficiary of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Beneficiary, Borrower will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Trustee and Beneficiary therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Indenture, (ii) the Permitted Encumbrances, (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement, (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement, and (v) liens arising out of or created by any statute, the discharge of which cannot under the terms of such statute at the particular time be effected by Borrower; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Borrower shall have the right to grant, without the prior consent of Beneficiary, any utility easement. ARTICLE V 5. Events of Default. If any one or more of the following events (individually, an "Event of Default") shall occur: (a) non-payment, when due, of any sums which Borrower is obligated to pay hereunder, under the Notes, or under the Loan Agreement continues unremedied for a period of five (5) days after the date such payment is due; or (b) failure of Borrower to keep in full force and effect its corporate existence, rights, franchises and privileges, except as provided for in the Loan Agreement; or (c) if an Event of Default (as defined in the Loan Agreement) shall have occurred under the Loan Agreement; or (d) if any of the representations or warranties made by Borrower in any document, instrument or certificate delivered in connection with the financing of the Property by Borrower proves to be untrue in any material respect; or (e) if a default shall have occurred under any Other Indenture and shall be continuing beyond the applicable grace or cure period provided therein; or 8 11 (f) if Borrower shall (i) voluntarily be adjudicated a bankrupt or insolvent, (ii) seek or consent to the appointment of a receiver or trustee for itself or for any portion of the Property, (iii) file a petition seeking relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, (iv) make a general assignment for the benefit of creditors, or (v) be unable to pay its debts as they mature; or (g) a court shall enter an order, judgment or decree appointing, with the consent of Borrower, a receiver or trustee for it or for any of the Property or approving a petition filed against Borrower which seeks relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, and such order, judgment or decree shall remain in force, undischarged or unstayed, sixty (60) days after it is entered; or (h) the estate or interest of Borrower in any of the Property shall be levied upon or attached in any proceeding and such estate or interest is about to be sold or transferred or such process shall not be vacated or discharged within fifteen (15) days after such levy or attachment; (i) if Borrower sells, conveys or transfers, voluntarily or otherwise, its interest in the Property without the prior written consent of Beneficiary; or (j) Any material provision of the Loan Documents relating to Trustee's and Beneficiary's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Borrower, or Borrower shall so state in writing. then, in any such event, Trustee or Beneficiary may accelerate the Indebtedness outstanding under this Indenture, and may take such other actions as may be provided under the Loan Agreement, or at law or in equity. ARTICLE VI 6. Assignment of Leases and Rents. 6.1. Assignment of Rents. As additional security hereunder, the Borrower hereby grants, bargains, conveys, assigns, transfers and sets over, and by these presents does grant, bargain, convey, assign, transfer and set over to the Beneficiary, as well as the Trustee on behalf of the Beneficiary, all Rents, if any; provided, however, that unless and until an Event of Default occurs, the Borrower will have a license to collect and retain such Rents as and when, but not before, the same shall become due and payable. Upon an Event of Default, the Beneficiary shall be immediately entitled to and may collect such Rents. In addition, upon an Event of Default, the Beneficiary, or the Trustee on the Beneficiary's behalf, may at any time and without notice, either in person or by agent or by receiver to be appointed by a court, enter and take possession of the Property or any part thereof, and in its own name, sue for or otherwise collect such Rents. The Borrower 9 12 hereby agrees with the Beneficiary that other parties under the Leases may, upon notice from the Beneficiary, or the Trustee acting on behalf of the Beneficiary, on the occurrence of an Event of Default, thereafter pay directly to the Beneficiary the Rents due and to become due under the Leases and attorn to all other obligations thereunder, directly to the Beneficiary without any obligation on their part to determine whether an Event of Default does, in fact, exist or has, in fact, occurred. All Rents collected by the Trustee or the Beneficiary shall be applied as provided in Article XII hereof; provided, however, that if the costs and expenses and attorney's fees shall exceed the amount of the Rents collected, the excess shall be added to the Indebtedness, shall bear interest at the maximum rate allowable by law as provided herein, and shall be immediately due and payable. The entering upon and taking possession of the Property, the collection of Rents, if any, and the application thereof as aforesaid, shall not cure or waive any Event of Default or notice of default, if any, hereunder, nor invalidate any act done pursuant to such notice except to the extent that such default is fully cured. Failure or discontinuance of the Trustee or the Beneficiary at any time or from time to time, to collect said Rents, shall not in any manner impair the subsequent enforcement by the Beneficiary, or the Trustee on the Beneficiary's behalf, of the right, power and authority herein conferred upon it. Nothing contained herein, nor the exercise of any right, power or authority herein granted to the Beneficiary, or the Trustee on the Beneficiary's behalf, shall be construed to be an affirmation by it of any tenancy, lease or option, nor an assumption of liability under, nor the subordination of the lien or charge of this Indenture, to any such tenancy, lease or option. ARTICLE VII 7. Remedies in Case of Event of Default. 7.1. Legal Proceedings and Foreclosure. If an Event of Default shall have occurred, Trustee or Beneficiary may proceed by suit or suits at law or in equity or by any other appropriate remedy to protect and enforce its rights hereunder, whether for the specific performance of any covenant or agreement contained herein, or for an injunction against the violation of any of the terms hereof, or in aid of the exercise of any right, power or remedy available to it, or to enforce the payment of the Indebtedness under the Loan Agreement, or to foreclose the lien and security interest of this Indenture as against all or any part of the Property and to have all or any part of the Property sold, in any manner permitted by law, under the judgment or decree of a court or courts of competent jurisdiction, or otherwise, and to pursue any other remedy available to it. If Beneficiary proceeds to foreclose the lien of this Indenture, Trustee shall have the statutory power of sale if permitted by applicable law. In the event of any such suit or proceeding, Beneficiary and/or Trustee shall comply with any local laws applicable to any such suits or proceedings. Any such suit or proceeding instituted by Trustee shall be brought in its name as Trustee and any recovery or judgment shall be for the benefit of Beneficiary. All costs and expenses (including, without limitation, reasonable attorney's fees and expenses) incurred by Trustee or Beneficiary in connection with any such suit or 10 13 proceeding, together with interest thereon (to the extent permitted by law) computed at the Default Rate from the date on which such costs or expenses are incurred to the date of payment thereof, shall constitute additional Indebtedness secured by this Indenture and shall be paid by Borrower to Trustee or Beneficiary, as the case may be, on demand. 7.2. Power of Sale and Procedure. If an Event of Default shall have occurred, Trustee, at Beneficiary's election, may sell or offer for sale the Property in such portions, order and parcels as Beneficiary may determine, with or without having first taken possession of same, to the highest bidder for cash at public auction. In exercising such power of sale, Trustee shall give such notice of hearing as to the commencement of the foreclosure proceedings and shall obtain such findings or leave at court as may then be required by applicable law and shall give such notice of such foreclosure sale and shall advertise the time and place of such sale in such manner as may then be provided by applicable law and shall comply in all respects with all laws applicable to the institution, conduct, and completion of power of sale foreclosures. Such sale shall be made in conformance with the laws of the State in which the Property is located at the courthouse door of the county wherein the Property is situated. All aspects of any power of sale foreclosure commenced by Trustee hereunder shall be accomplished in such manner as permitted or required by State law in existence on the date hereof relating to the sale of real estate and/or relating to the sale of collateral after a default by a debtor, as the same may be amended or supplemented, or by any subsequent laws relating to same. At any such sale (i) whether made under the power herein contained, State law, any other legal requirement or by virtue of any judicial proceeding or any other legal right, remedy or recourse, it shall not be necessary for Trustee to have physically present, or to have constructive possession of, the Property (Borrower hereby covenanting and agreeing to deliver to Trustee any portion of the Property not actually or constructively possessed by Trustee immediately upon demand by Trustee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to such purchaser at such sale, and (ii) the receipt of Trustee or of such other party or officer making the sale shall be a sufficient discharge to the purchaser or purchasers for his or their purchase money and no such purchaser or purchasers, or his or their assigns or personal representatives, shall thereafter be obligated to see to the application of such purchase money or be in any way answerable for any loss, misapplication or non-application thereof. 7.3. Acceleration of Maturity. If an Event of Default shall have occurred, Beneficiary may declare the entire outstanding Indebtedness under the Loan Agreement, and all other sums secured hereby, to be due and payable immediately, and upon such declaration, such Indebtedness and other sums shall immediately become and be due and payable without demand or notice. 7.4. Leases. Trustee at the option of Beneficiary is authorized to foreclose this Indenture subject to the rights of any tenants of the Property, and the failure to make any 11 14 such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, nor be asserted by Borrower to be, a defense to any proceedings instituted by Trustee and/or Beneficiary to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property. 7.5. Suits to Protect the Property. Beneficiary, or Trustee at Beneficiary's election, shall have the power and authority to institute and maintain any suits and proceedings as Beneficiary may deem advisable (a) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Indenture, (b) to preserve or protect its interest in the Property, and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Beneficiary's interest. 7.6. Discontinuance of Proceedings; Position of Parties Restored. If Beneficiary, or Trustee at Beneficiary's election, shall have proceeded to enforce any right or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to Beneficiary, then and in every such instance, Borrower and Beneficiary shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Beneficiary shall continue as if no such proceeding had occurred or had been taken. 7.7. Borrower to Pay the Indebtedness on Any Default in Payment; Application of Monies by Beneficiary. (a) If an Event of Default shall occur as a result of Borrower's failure to pay any amount due under the Loan Agreement or this Indenture, then, upon Beneficiary's demand, Borrower will pay to Beneficiary the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Borrower shall fail to pay the same forthwith upon such demand, Beneficiary, or Trustee at Beneficiary's election, shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Beneficiary's agents, attorneys and other representatives. Beneficiary shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Indenture, and the right of Beneficiary to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Indenture, or the foreclosure of the lien hereof. (b) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Beneficiary 12 15 shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. (c) Borrower hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Beneficiary and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the lien of this Indenture upon the Property or any part thereof or any lien, rights, powers or remedies of Beneficiary hereunder, but such lien, rights, powers and remedies of Beneficiary hereunder shall continue unimpaired as before. ARTICLE VIII 8.1. Purchase of the Property by Beneficiary. Beneficiary may be a purchaser of the Property or any part thereof or any interest therein at any sale thereof, whether pursuant to foreclosure, power of sale or otherwise, and may apply the Indebtedness secured hereby to the purchase price. 8.2. Title Upon Sale; Receipt a Sufficient Discharge to Purchaser. After the occurrence of an Event of Default hereunder, and upon the sale of the Property or any part thereof or any interest therein by Trustee or Beneficiary, whether pursuant to foreclosure, power of sale or otherwise, the purchaser shall acquire good title thereto, free of the lien of this Indenture and free of all rights of redemption, whether statutory, equitable or otherwise, in Borrower to the extent permitted by applicable law. The receipt of the officer making the sale under judicial proceedings or of Trustee or Beneficiary shall be sufficient discharge to the purchaser for the purchase money, and such purchaser shall not be obligated to see to the application thereof. All occupants of the Property sold or any part thereof shall become tenants at sufferance of the purchaser, and as long as a tenant is not in default under its Lease, the purchaser will not disturb the occupancy of such tenant of the Property during the term of its Lease. It shall not be necessary for the purchaser at any such sale to bring any action for possession to the Property purchased other than statutory action of forcible detainer in any justice court having jurisdiction. 8.3. Application of Indebtedness Toward Purchase Price. If Beneficiary purchases the Property pursuant to foreclosure, power of sale or otherwise, then Beneficiary may, in lieu of cash, apply all or any portion of the sums due to Beneficiary under the Loan Agreement and this Indenture or any other instrument securing the Indebtedness, to the unpaid balance of the purchase price remaining after payment of any portion of the purchase price required to be paid in cash, and the costs and expenses of the sale, compensation and other charges relating to the sale. 13 16 ARTICLE IX 9. Waiver of Appraisement, Valuation, Etc. Borrower hereby waives, to the full extent it may lawfully do so, the benefit of all appraisement, valuation, stay, moratorium, exemption from execution, extension and redemption laws now or hereafter in force and all rights of marshaling in the event of the sale of the Property or any part thereof or any interest therein. ARTICLE X 10. Appointment of Receiver. If an Event of Default shall have occurred, Trustee and/or Beneficiary shall, as a matter of right and to the fullest extent permitted by applicable law, be entitled, ex parte and without notice, to the appointment of a receiver or receivers of the Property or any part thereof, whether such receivership be incidental to a proposed sale thereof or otherwise, and Borrower hereby consents to the appointment of such a receiver or receivers and will not oppose any such appointment. The expenses, including receiver's fees, attorney's fees, costs and agent's compensation, incurred pursuant to the powers herein contained shall be secured by this Indenture. ARTICLE XI 11. Possession, Management and Income. If an Event of Default shall have occurred under this Indenture, Trustee or Beneficiary, without further notice, may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Borrower and all other Persons and any and all property therefrom, and Trustee or Beneficiary may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Trustee or Beneficiary shall be applied (a) to pay (i) the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of Trustee and all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Trustee or Beneficiary and all other costs and expenses of entering a bond and taking possession of and holding the Property, and (ii) any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge and then (b) in the manner provided in Article XI of this Indenture. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Trustee or Beneficiary shall be applied in the manner specified in Article XI of this Indenture. 14 17 ARTICLE XII 12. Application of Proceeds. The proceeds of (a) the operation and management of the Property pursuant to Article XI of this Indenture, and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, reasonable Trustee's fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Trustee and Beneficiary or in the pursuance of any remedies hereunder; Second: to the fullest extent permitted by applicable law, to any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge; Third: to any Indebtedness secured by this Indenture and at the time due and payable (whether by acceleration or otherwise; Fourth: to Beneficiary for payment of the Notes outstanding; and Fifth: the balance, if any, to Borrower. ARTICLE XIII 13. Remedies, Etc., Cumulative. Each legal, equitable or contractual right, power or remedy of Trustee and Beneficiary now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Trustee or Beneficiary of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. ARTICLE XIV 14. No Waiver, Etc. No failure by Trustee or Beneficiary to insist upon the strict performance of any term hereof or to exercise any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Indenture or under the Loan Agreement during the continuance of any Default shall constitute a waiver thereof. No waiver of any breach shall affect or alter this Indenture which shall continue in full force and effect with respect to any other then existing or subsequent breach. 15 18 ARTICLE XV 15. Trustee. (a) All the rights, powers and remedies of Beneficiary hereunder may be exercised by Trustee. Trustee shall not be under any obligation to exercise any trust or power vested in him by this Indenture unless Beneficiary shall have offered Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred by Trustee in compliance herewith. Trustee shall not be liable with respect to any action taken or omitted to be taken by Trustee in accordance with the written directions of Beneficiary, except for Trustee's own bad faith, willful misconduct or negligence. Trustee shall not be required to ascertain or inquire as to the performance or observance of any of the covenants or agreements of Borrower herein, and in the absence of written notice from Borrower or Beneficiary stating that a Default has occurred and specifying the same, Trustee may conclusively assume that no Default exists. (b) Trustee may, with consent of Beneficiary, consult with counsel (which may be counsel for Borrower) and the written advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by him hereunder in good faith and in accordance therewith. (c) Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys. (d) Any moneys received by Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. (e) Beneficiary may, by instrument in writing, filed in the office or offices where this Indenture has been recorded, and at any time or from time to time, and without notice and without specifying any reason therefor, and without applying to any court, remove Trustee and select a successor trustee or trustees in the event of the death, removal, resignation, refusal to act, or inability to act of Trustee or, in its sole discretion, for any reason whatsoever. Trustee so ceasing to act shall duly assign, transfer and deliver any of the property and monies held by such Trustee to the successor appointed in Trustee's place. All powers, rights and duties and authority of Trustee shall thereupon become vested in the successor. The successor shall not be required to give bond or make an oath for the faithful performance of his duties unless required by Beneficiary. (f) Trustee may resign by the giving of notice of such resignation in writing to Beneficiary. (g) If more than one Trustee is appointed under this Indenture, all rights granted to and all powers conferred upon Trustee hereunder may be exercised by both or either of Trustees. 16 19 (h) All reasonable expenses, charges, counsel fees and other disbursements incurred by Trustee in and about the administration of this Indenture and executed in the performance of its duties and powers hereunder shall be secured by this Indenture. ARTICLE XVI 16. Right of Trustee or Beneficiary to Perform Covenants, Etc. If Borrower shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Trustee or Beneficiary, without notice to or demand upon Borrower and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Borrower and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Trustee or Beneficiary, may be necessary or appropriate therefor. All sums so paid by Trustee or Beneficiary and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Indebtedness secured by this Indenture and shall be paid by Borrower to Trustee or Beneficiary on demand. ARTICLE XVII 17. Certificate as to No Default, Etc.; Information. At any time and from time to time, Borrower will deliver to Beneficiary, promptly upon request, a certificate signed by a duly authorized officer of Borrower stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Borrower is taking or proposes to take with respect thereto. Borrower will also furnish promptly to Beneficiary, such information with respect to the Property and the Leases as may from time to time be requested. ARTICLE XVIII 18. Additional Instruments. Borrower, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Trustee or Beneficiary from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Indenture or intended so to be. ARTICLE XIX 19. Defeasance. This Indenture and the lien created hereby shall terminate after the payment in full of (a) all the Indebtedness and (b) all other sums secured hereby. Upon such termination, and upon surrender of this Indenture for cancellation, Beneficiary shall 17 20 release, without warranty, the Property then subject to the lien hereof to the Persons entitled thereto. The recitals in any reconveyance executed under this Indenture of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such release may be described as "the person or persons legally entitled thereto". Trustee and/or Beneficiary, at Borrower's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the lien created hereby, and (b) any other security held by Trustee and/or Beneficiary and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Indenture. ARTICLE XX 20. Applicable Law; Severability. (a) This Indenture shall be governed by and construed in accordance with the laws of the State. (b) All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Indenture invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Indenture shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. ARTICLE XXI 21. Miscellaneous. This Indenture (a) may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and (b) shall be binding upon Borrower, its successors and assigns, and all Persons claiming under or through Borrower or any such successor or assign, and shall inure to the benefit of and be enforceable by Trustee and its successors and Beneficiary and its successors and assigns. The headings in this Indenture are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All agreements between Borrower and Beneficiary, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Beneficiary exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Beneficiary in excess of the maximum lawful amount, and if in any circumstance Beneficiary shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, and if permitted by applicable law, 18 21 an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Borrower. All interest paid or agreed to be paid to Beneficiary shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Borrower and Beneficiary. This Indenture may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. Portions of the Property consist of goods which are, or are to become, fixtures relating to the Land and Borrower expressly covenants and agrees that the filing of this Indenture in the real estate records of the county where the Property is located shall also operate from the time of filing therein as a financing statement filed as a fixture filing in accordance with Article 9 of the State's Uniform Commercial Code - Secured Transactions. ARTICLE XXII 22. Change in Method of Taxation. In the event of the passage, after the date of this Indenture, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Beneficiary in the Property, this Indenture or the Loan Agreement, Borrower shall, upon demand, bear and pay the full amount (or any partial amount) requested by Beneficiary, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE XXIII 23. Trustee's Acceptance. Trustee accepts the trust created hereby when this Indenture, duly executed and acknowledged, is made a public record in the State and county where the Property is located, as provided by the laws of the State. ARTICLE XXIV 24. No Petition. Trustee and Beneficiary hereby covenant and agree that they will not institute against, or join any Person in instituting against Borrower, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law at any time other than on a date which is at least one (1) year and one (1) day after the payment in full of the Notes; provided, however, that nothing in this Article shall constitute a waiver of any right to indemnification, reimbursement or other payment from Borrower pursuant to the Loan Agreement. 19 22 ARTICLE XXV 25. Indenture Secures Future Advances. This Indenture is given to secure not only the amount initially secured by this Indenture, but also such future advances, whether such advances are obligatory or are to be made at the option of Trustee or Beneficiary, or otherwise, as are made within fifteen (15) years from the date hereof, to the same extent as if such future advances were made on the date of the execution of this Indenture. The total amount of advances outstanding and presently secured hereby is Eighty-six Million Dollars ($86,000,000.00). The Loan Agreement currently provides Borrower with a revolving line of credit up to $150,000,000.00. However, pursuant to Section 2.11 of the Loan Agreement, Borrower may request an increase to the Loan Amount up to $200,000,000.00 upon approval of the Lenders as set forth therein. Any such increase to the Loan Amount shall constitute a future advance and shall be secured by this Indenture to the same extent as if such future advance was made on the date of the execution of this Indenture. This Indenture secures a revolving line of credit under which Advances may be made, repaid, and reborrowed on a revolving basis as provided for in the Loan Agreement. ARTICLE XXVI 26. Approval of Legal Description. Borrower has read and does hereby approve the legal description of the Land which Is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Trustee and Beneficiary and their attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XXVII 27. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Indenture and the Loan Agreement, the Loan Agreement shall control. The Loan Agreement contains provisions permitting Borrower to obtain releases of portions of the Property from this Indenture from time to time. ARTICLE XXVIII 28. WAIVER OF JURY TRIAL. BORROWER, TRUSTEE, AND BENEFICIARY, BY THEIR ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER BORROWER, TRUSTEE, NOR BENEFICIARY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS DEED OF TRUST, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG BORROWER, TRUSTEE OR BENEFICIARY RELATED 20 23 THERETO. NONE OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY BORROWER, TRUSTEE, AND BENEFICIARY, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR TRUSTEE AND BENEFICIARY TO MAKE THE LOAN TO TRUSTOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 21 24 IN WITNESS WHEREOF, Borrower has caused this Indenture to be executed and attested by its proper officers thereunto duly authorized, as of the day and year first above written and has executed the same in order that this Indenture may qualify as a financing statement under the Uniform Commercial Code of the State as to such of the Property, if any, constitutes personalty. KOGER EQUITY, INC., Attest: a Florida corporation By:/s/ W. Lawrence Jenkins By:/s/ G. Danny Edwards ----------------------- ----------------------------- Name: W. Lawrence Jenkins Name: G. Danny Edwards Its: Corporate Secretary Title: Treasurer [AFFIX CORPORATE SEAL] STATE OF Georgia: COUNTY OF Camden: I, Dee Price, a Notary Public of the County of Camden, State of Georgia, do hereby certify that W. Lawrence Jenkins, personally appeared before me this day and acknowledged that he/she is the Secretary of KOGER EQUITY, INC., a Florida corporation, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its Treasurer, sealed with its corporate seal, and attested by himself/ herself as its Secretary. Witness my hand and official seal this 30th day of December, 1998. /s/ Dee Price -------------------------------------- Notary Public Notary Public, Camden County, Georgia My commission expires: February 1, 1999 [NOTARIAL SEAL] 22 25 EXHIBIT A The Land 26 EXHIBIT B Permitted Encumbrances EX-10.(K)(5)(A)(II) 20 AMEND AND RESTATED ASSIGNMENT OF LEASES & RENTS 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(5)(a)(ii) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS THIS AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS (this "Assignment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. RECITALS: A. Assignor is the mortgagor under that certain Second Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement given by Assignor to Assignee dated of even date herewith and recorded or to be recorded in the public records of Guilford County, North Carolina (the "Deed of Trust"); securing the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes", as such term is defined in the Loan Agreement), encumbering certain real property interests located in Guilford County, North Carolina, as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Assignment for the purposes set forth herein. 1 3 C. This Assignment amends and restates that certain Assignment of Leases and Rents recorded in Official Records Book 4630, Page 0144, of the public records of Guilford County, North Carolina, which Assignment of Leases and Rents was assigned to Assignee pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith to be recorded in the public records of Guilford County, North Carolina. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title and interest in, to and under any and all present and future leases of or in the Premises ("Leases") and any and all rents, revenues, issues and profits (including Assignor's interest in any security deposits relating thereto) arising out of or accruing from the Leases whether now or hereafter due ("Rents"), said Leases and Rents being deemed part of the security for the indebtedness herein mentioned and are encumbered, transferred and conveyed by this Assignment, and in furtherance thereof, does hereby covenant and agree with Assignee as follows: 1. Assignor will notify Assignee in writing (but without any right of approval or denial on the part of Assignee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement). 2. Assignor will, at its cost and expense, observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Assignor or its agents under the Leases, and will use its reasonable best efforts in the exercise of sound business judgment to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Assignor will not do or permit to be done anything to impair the security hereof, including without limitation the execution of any other assignment of Assignor's interest in the Leases or the Rents, without Assignee's prior written consent. 3. This Assignment is intended to operate as an absolute and immediate assignment of the Leases and the Rents; however, unless and until a default occurs under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignor will have a license to collect the Rents as and when the same become due and payable. Assignor hereby agrees that the respective tenants under the Leases, upon notice from Assignee of the occurrence of a default hereunder, will thereafter pay to Assignee the Rents due and to become due under the Leases without any obligation to determine whether or not such a default does in fact exist. Assignor, without written approval of Assignee, will not collect or accept Rent for more than one (1) month in advance; provided, however, Assignor may 2 4 accept Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month. 4. Upon payment in full of the principal sum and interest, of the Notes, this Assignment shall become and be void and of no effect. Assignor hereby authorizes and directs the lessees named in said Leases or any other or future lessees or occupants of the Premises described therein or in the Deed of Trust upon receipt from the Assignee of written notice to the effect that Assignee is then the holder of the Notes and the Deed of Trust and that a default exists thereunder or under the Assignment, to pay over to the Assignee all rents, income, profits and revenues hereby assigned and to continue so to do until otherwise notified by Assignee. 5. This Amended and Restated Assignment of Leases and Rents as provided herein will not be deemed or construed to constitute Assignee as a mortgagee in possession of the Premises nor to obligate Assignee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Assignor under any Lease, or for the control, care, management, or repair of the Premises; nor will it operate to make Assignee, except in the event of Assignee's negligence, recklessness or wilful misconduct, responsible or liable for any waste committed on the Premises by the tenants or any other parties or for any dangerous or defective condition of the Premises, or for any act or omission relating to the management, upkeep, repair, or control of the Premises that results in loss or injury or death to any person. Except in the event of Assignee's negligence, recklessness or wilful misconduct, Assignee will not be liable for any loss sustained by Assignor resulting from Assignee's failure to lease the Premises after default or from any other act or omission of Assignee in managing the Premises after default. Assignor will and does hereby indemnify and agree to hold harmless Assignee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this Assignment of Leases (except as a result of Assignee's gross negligence or willful misconduct) and, to the extent that a claim is made against Assignee prior to the time Assignee takes possession of the Premises, from any and all claims and demands whatsoever which may be asserted against Assignee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases. Should Assignee incur any such liability under the Leases or by reason of this Amended and Restated Assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Assignor will reimburse Assignee therefor immediately upon demand and upon the failure of Assignor so to do, Assignee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Assignor as an advance under the Notes and secured by this Assignment. 6. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Assignee of the remedies provided for by law or by the Notes, the Deed of Trust or this Assignment, the lessee thereunder will, upon request of any person succeeding to the interest of Assignor as a result of such enforcement, 3 5 automatically become the lessee of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month or two (2) months in advance (as applicable in accordance with Paragraph 3 above). The Leases are and at all times shall be subject and subordinate in all respects to the Deed of Trust, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of the Deed of Trust, to the full extent of all principal, interest and all other amounts secured thereby. Provided that a tenant is not in default under its Lease, Assignee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of the Deed of Trust, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided in the Deed of Trust, or pursuant to the laws of the State of North Carolina. If requested by a tenant or Assignor under any of the Leases or upon Assignee's request, Assignor and Assignee shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Assignee) with such tenant whereby Assignee will agree to not disturb the tenant in its possession of the Premises provided such tenant is not in default under its Lease and the tenant will agree to attorn to Assignee if Assignee takes possession of the Premises. 7. Upon a default under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignee may at its option, without notice and without regard to the adequacy of the security for the obligations set forth in the Notes, either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Premises, to have, hold, manage, lease and operate the same on such terms and for such period of time as Assignee may deem proper, and either with or without taking possession of the Premises in its own name, demand and receive the Rents in the possession of Assignor at the time of Assignee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Assignee, and to apply such Rents to the payment of: (a) all reasonable expenses of managing the Premises, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Assignee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Assignee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Premises and protecting and preserving the same; or (b) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Assignee in its sole discretion may determine, any custom or use to the contrary notwithstanding. 8. This Assignment is made and accepted without prejudice to any of the rights and remedies possessed by Assignee under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust, and the right of Assignee to exercise its remedies under this Assignment may be exercised by Assignee either prior to, simultaneously with, or subsequent to any action taken by it under the remaining terms and 4 6 conditions of the Notes, the Loan Agreement, or the Deed of Trust. Each and every right, remedy and power granted to Assignee by this Assignment will be cumulative and in addition to any other right, remedy and power given by the remaining terms and conditions of the Notes, the Loan Agreement, the Deed of Trust or this Assignment, or now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this Assignment, and no act done or omitted by Assignee pursuant to the powers and rights granted it hereunder, nor the failure of Assignee to avail itself of any of the rights and remedies under this Assignment, will be construed or deemed to be a waiver of any of Assignee's rights and remedies under this Assignment, nor will such exercise or omission to exercise of the powers and rights granted Assignee hereunder be deemed to constitute a waiver of its rights and remedies under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust. 9. Assignee may take or release other security for the payment of the indebtedness under the Notes and the Deed of Trust, may release any party primarily or secondarily liable therefor, and may apply any other security held by it to the satisfaction of such indebtedness without prejudice to any of its rights under this Assignment. 10. The term "Lease" or "Leases" as used herein, means said Leases hereby assigned or any extension or renewal thereof, and any leases subsequently executed during the term of this Assignment covering the Premises or any part thereof. At Assignee's request, Assignor will assign and transfer to Assignee any and all subsequent leases upon all or any part of the Premises and to execute and deliver at the request of Assignee all such further assurances and assignments in the Premises as Assignee will require from time to time in its sole discretion. 11. This Assignment, together with the covenants and warranties therein contained, shall inure to the benefit of Assignee and any subsequent holder of the Notes and the Deed of Trust shall be binding upon Assignor, their successors, executors, personal representatives, and assigns, and any subsequent owner of the Premises. 12. This Assignment shall expire and terminate upon the payment in full of the Notes and any other Indebtedness secured by the Deed of Trust and any cancellation, satisfaction or release of the Deed of Trust shall constitute a cancellation, satisfaction, or release of this Assignment. In the event that a specific property is released from the lien of the Deed of Trust, then such property and the Leases relating to it shall, effective with the release, also be released from this Assignment. 13. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP 5 7 BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. IN WITNESS WHEREOF, Assignor has executed this Assignment under seal the day and year first above written. Attest: ASSIGNOR: KOGER EQUITY, INC., By: /s/ W. Lawrence Jenkins a Florida corporation ------------------------ Name: W. Lawrence Jenkins ------------------------ Its: Secretary ------------------------- By: /s/ G. Danny Edwards -------------------------- Name: G. Danny Edwards ------------------------ Title: Treasurer ------------------------ [AFFIX CORPORATE SEAL] Attest: ASSIGNEE: FIRST UNION NATIONAL BANK, a By: /s/ Lynn E. Vermilva national association, as Agent -------------------------- Name: Lynn E. Vermilva ------------------------ Its: Vice President By: /s/ Andrew J. Hogshead ------------------------ --------------------------- Name: J. Andrew Hogshead ------------------------- Title: Vice President ------------------------ [AFFIX CORPORATE SEAL] 6 8 STATE OF Georgia: ------- COUNTY OF Camden: ------- I, Dee Price, a Notary Public of the County of Camden, State of Georgia, do hereby certify that W. Lawrence Jenkins, personally appeared before me this day and acknowledged that he is the _______ Secretary of KOGER EQUITY, INC., a Florida corporation, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its Treasurer, sealed with its corporate seal, and attested by himself as its_______ Secretary. Witness my hand and official seal this 30th day of December, 1998. /s/ Dee Price -------------------------------------- Notary Public Notary Public, Camden County, Georgia My commission expires: Feb. 1, 1999 [NOTARIAL SEAL] STATE OF Florida: -------- COUNTY OF Duval: ------ I, Nancy Hoffmann, a Notary Public of the County of Duval, State of Florida, do hereby certify that Lynn E. Vermilva, personally appeared before me this day and acknowledged that she is the Vice Pres. of FIRST UNION NATIONAL BANK, a national association, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its J. Andrew Hogshead, its Vice Pres., sealed with its corporate seal, and attested by herself as its Vice Pres. Witness my hand and official seal this 30th day of December, 1998. /s/ Nancy Hoffmann -------------------------------------- Notary Public My commission expires: September 3, 2000 Bonded Thru Notary Public Underwriters [NOTARIAL SEAL] 7 9 EXHIBIT A LEGAL DESCRIPTION OF PREMISES 8 EX-10.(K)(5)(A)(III) 21 AMEND TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT 1 EXHIBIT 10(K)(5)(A)(III) AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT THIS AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Amendment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower") whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Agent (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank F.S.B., a federal savings bank (collectively, the "Original Lenders") entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, Borrower provided the Original Lenders with that certain Amended and Restated Deed of Trust and Security Agreement dated as of December 29, 1997, and recorded in Book 4630, page 099, of the public records of Guilford County, North Carolina, and that certain Deed of Trust and Security Agreement dated as of December 29, 1997, and recorded in Book 9430, Page 207, of the public records of Mecklenburg County, North Carolina (collectively, the "Deed of Trust"), wherein Borrower granted to the Original Lenders a security interest in certain real property described therein (the "Property") as security for the Loan. 3. As a condition precedent to and as a material inducement for the Original Lenders' agreement to provide the Loan to Borrower, the Original Lenders required 3 Borrower to execute and deliver that certain Environmental Indemnification Agreement dated as of December 29, 1997 covering the Property (the "Environmental Agreement"), which Environmental Agreement was assigned to Agent pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith. 4. Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Deed of Trust. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Environmental Agreement is modified in accordance with the terms and conditions hereinafter set forth. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" or "Lenders" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders under and as defined in the Loan Agreement. 3. Additional Promissory Notes. All references to the term "Notes" as utilized in the Environmental Agreement shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of the Lenders, as applicable. 4. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith between Borrower and First Union National Bank, as Agent for the Lenders. All references to the term "Loan" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 5. Amended and Restated Deed of Trust. All references to the term "Deed of Trust" as utilized in the Environmental Agreement shall hereinafter be deemed to refer collectively to that certain Second Amended and Restated Deed of Trust and Security Agreement from Borrower to Agent of even date herewith, and to be recorded in the public records of Guilford County, North Carolina, and that certain Amended and Restated Deed 2 4 of Trust and Security Agreement from Borrower to Agent of even date herewith, and to be recorded in the public records of Mecklenburg County, North Carolina. 6. Ratification. Except as herein expressly amended, the Environmental Agreement is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 7. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Environmental Agreement. 8. Counterparts. This Amendment may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written. BORROWER: KOGER EQUITY, INC., a Florida Attest: corporation By: /s/ W. Lawrence Jenkins By: /s/ G. Danny Edwards --------------------------- ------------------------------------ Name: W. Lawrence Jenkins Name: G. Danny Edwards -------------------------- ---------------------------------- Its: Secretary Title: Treasurer ------------------ --------------------------------- [CORPORATE SEAL] LENDER: FIRST UNION NATIONAL BANK, a Attest: national association, as Agent By: /s/ Lynn E. Vermilva By: /s/ Andrew J. Hogshead --------------------------- ------------------------------------ Name: Lynn E. Vermilva Name: J. Andrew Hogshead -------------------------- ---------------------------------- Its: Vice President Title: Vice President --------------------------- --------------------------------- [CORPORATE SEAL] 3 EX-10.(K)(5)(A)(IV) 22 AM TO ASSIGNMENT OF CONTRACTS LICENSES & PERMITS 1 EXHIBIT (10)(K)(5)(A)(IV) AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK OF FLORIDA, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS THIS AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS (this "Assignment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders (as such term is defined in the Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Lender (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank, F.S.B., a federal savings bank (collectively, the "Original Lenders"), entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to the Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, the Borrower provided the Original Lenders with that certain Amended and Restated Deed of Trust and Security Agreement dated as of December 29, 1997, and recorded in Book 4630, page 099, of the public records of Guilford County, North Carolina, and that certain Deed of Trust and Security Agreement dated as of December 29, 1997, and recorded in Book 9430, page 207, of the public records of Mecklenburg County, North Carolina (collectively, the "Indenture"), wherein the Borrower granted to the Original Lenders a security interest in certain real property described therein as security for the Loan. 3. As additional collateral for repayment of the Loan, Borrower made and delivered to the Original Lenders that certain Assignment of Contracts, Licenses and Permits dated December 29, 1997 (the "Assignment of Contracts"), which Assignment of 3 Contracts was assigned to Agent pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith. 4. The Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Indenture. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Assignment of Contracts is modified in accordance with the terms and conditions hereinafter set forth. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders. 3. Additional Promissory Notes. All references to the term "Notes" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of the Lenders. 4. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith between Borrower and Lender. All references to the term "Loan" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 5. Ratification. Except as herein expressly amended, the Assignment of Contracts is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 6. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Assignment of Contracts. 2 4 7. Counterparts. This Agreement may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. 8. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, THE AGENT, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO BORROWER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 3 5 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written. BORROWER: KOGER EQUITY, INC., a Florida Attest: corporation By: /s/ W. Lawrence Jenkins By: /s/ G. Danny Edwards --------------------------------- ----------------------------------- Name: W. Lawrence Jenkins Name: G. Danny Edwards ------------------------------- --------------------------------- Its: Secretary Title: Treasurer ------------------- -------------------------------- [CORPORATE SEAL] LENDER: Attest: FIRST UNION NATIONAL BANK, a national association, as Agent By: /s/ Lynn E. Vermilva By: /s/ Andrew J. Hogshead --------------------------------- ----------------------------------- Name: Lynne E. Vermilva Name: J. Andrew Hogshead ------------------------------- --------------------------------- Its: Vice President Title: Vice President -------------------------------- -------------------------------- [CORPORATE SEAL] 4 EX-10.(K)(5)(B)(I) 23 AMENDED & RESTATED DEED OF TRUST 1 THIS INSTRUMENT PREPARED BY, EXHIBIT 10(k)(5)(B)(i) AND FOLLOWING RECORDING RETURN TO: ALAN C. SHEPPARD, JR., ESQ. LEBOEUF, LAMB, GREENE & MACRAE, L.L.P. 50 NORTH LAURA STREET, SUITE 2800 JACKSONVILLE, FLORIDA 32202 AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO TRESTE, INC., AS TRUSTEE Dated as of December 30, 1998 State: North Carolina Section: Township: Range: County: Mecklenburg Tax I.D.: 2 AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT THIS AMENDED AND RESTATED DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT (this "Indenture"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose mailing address is 3986 Boulevard Center Drive, Suite 101, Jacksonville, Florida 32207 Attention: J.C. Teagle, President, to TRESTE, INC., a Virginia corporation authorized to do business in North Carolina ("Trustee") having an address c/o First Union National Bank, a national association, 301 South College Street, Charlotte, North Carolina 28288, as trustee for the benefit of FIRST UNION NATIONAL BANK, a national association, as Agent (the "Beneficiary") on behalf of the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith, as amended from time to time (the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, the Beneficiary's mailing address is One First Union Center, 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. Capitalized terms not otherwise defined herein are defined in Article I. This Indenture amends and restates that certain Deed of Trust and Security Agreement (the "Original Indenture") recorded in Official Records Book 9430, Page 207, of the public records of Mecklenburg County, North Carolina, which Original Indenture was assigned to Beneficiary, pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith to be recorded in the public records of Mecklenburg County, North Carolina (the "Assignment"). W I T N E S S E T H : THIS INDENTURE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Borrower and all indebtedness heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other indebtedness which this Indenture by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to each of the Lenders, (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of indebtedness secured hereby, other than for advances made pursuant to Article XXV, Paragraph 25 hereof, shall in no event exceed 1 3 $150,000,000.00 (the "Indebtedness") and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, in consideration of the aforesaid Indebtedness and the trust referred to and created below, Borrower hereby irrevocably grants, bargains and sells, conveys, transfers, assigns, sets over, hypothecates, pledges and grants to Trustee and its successors and assigns IN TRUST WITH POWER OF SALE in and to all of Borrower's right, title and interest in the following property and rights whether now owned or hereafter acquired by Borrower (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the "Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) all fixtures, machinery, equipment and other personal property of all types owned by Borrower now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Borrower's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Indebtedness; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Borrower, to appear in and defend any action or proceeding brought with respect to Borrower's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or 2 4 proceeding to protect the interest of Beneficiary in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property unto Trustee and its successors and assigns, forever; IN TRUST NEVERTHELESS to its own proper use and benefit forever, upon the terms and trusts herein set forth for the benefit and security of Beneficiary. This Indenture is a deed of trust of real property and a security agreement covering the Fixtures under the Uniform Commercial Code of the State. Upon the occurrence of an Event of Default, Trustee and Beneficiary shall, in addition to other rights and remedies granted to them, have all the rights granted to secured parties pursuant to the Uniform Commercial Code of the State. Borrower, for itself and for its successors and assigns, covenants and agrees with Trustee and with Beneficiary as follows: ARTICLE I 1. Definitions. As used in this Indenture, the following capitalized terms have the respective meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Beneficiary" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Borrower" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Article V of this Indenture. 3 5 "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in clause (iv) of the Granting Clause of this Indenture. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Borrower, Beneficiary or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in clause (ii) of the Granting Clause of this Indenture. "Indebtedness" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Indenture" shall mean this Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement. "Land" shall mean those certain parcels of real property located in the County of Mecklenburg, State of North Carolina, as more particularly described on Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "Lenders" shall mean FUNB, GFB, AmSouth, Citizens, and Compass, and any other Lenders under the Credit Agreement from time to time. 4 6 "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 between Borrower and Beneficiary. "Loan Documents" shall mean collectively, the Notes, the Loan Agreement, this Mortgage, and the Security Deeds, the Assignments of Leases, the Assignments of Contracts, the Indemnification Agreements, as such terms are defined in the Loan Agreement and any and all other loan documents executed in connection with the Loan. "Notes" shall mean collectively (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of FUNB in the principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Compass in the original principal amount of $15,000,000. "Other Indenture" shall mean any mortgage, deed to secure debt, or deed of trust given by Borrower to or in favor of Trustee or Beneficiary to secure the Indebtedness, other than this Indenture. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Rents" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "State" shall mean the State of North Carolina. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as 5 7 the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. "Trustee" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. ARTICLE II 2. Representations and Warranties. Borrower represents and warrants to Trustee for the benefit of Beneficiary that (a) it has full power, authority and legal right to execute and deliver this Indenture and to grant a first deed of trust of the Property, (b) it holds good and marketable fee simple title to the Land and good and marketable title to the balance of the Property, (c) this Indenture constitutes a valid first deed of trust of the Property, subject to the Permitted Encumbrances, and (d) the Leases are in full force and effect in accordance with their respective terms, have not been canceled or modified, and have not been assigned or encumbered except to Beneficiary pursuant to this Indenture and the Loan Agreement, and, to the best of Borrower's knowledge, no default exists under the Leases. Borrower, at its expense, will warrant to Trustee and to Beneficiary and will defend its title to the Property and the lien thereon created by this Indenture against all claims and demands, and will maintain and preserve such lien so long as the Indebtedness secured by this Indenture remains outstanding, subject, however, to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Indenture and the lien created hereby shall terminate in accordance with Article XIX, Borrower shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Indenture and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the lien of this Indenture as a first lien on the Property and the rights of Trustee and Beneficiary hereunder. Borrower shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance. (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end. 6 8 (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the same shall be contested in good faith and by appropriate proceedings by Borrower in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that the Borrower is otherwise in compliance with the Loan Agreement. Upon the written request of Beneficiary from time to time, Borrower will furnish to Beneficiary official receipts or other satisfactory proof evidencing such payments. In addition, Borrower will pay all utility charges as required by the Loan Agreement. Borrower shall not be entitled to any credit on the Indebtedness, by reason of the payment of any Imposition or utility charges or any part thereof. (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Borrower in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvement and the Fixtures, or any part of either thereof. (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Beneficiary any certificates or evidence of such insurance as required under the Loan Agreement. (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Borrower shall give immediate written and oral notice thereof to Beneficiary and Trustee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Beneficiary shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Borrower would be entitled thereto under the Loan Agreement, and Borrower hereby irrevocably assigns to Beneficiary all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Borrower will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Beneficiary. At the sole cost and expense of Borrower, Beneficiary may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Beneficiary in connection with, any claim or the claims payment process. Borrower will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Beneficiary shall be applied in accordance with the provisions of the Loan Agreement. 7 9 (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Trustee and Beneficiary of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Beneficiary, Borrower will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Trustee and Beneficiary therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Indenture, (ii) the Permitted Encumbrances, (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement, (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement, and (v) liens arising out of or created by any statute, the discharge of which cannot under the terms of such statute at the particular time be effected by Borrower; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Borrower shall have the right to grant, without the prior consent of Beneficiary, any utility easement. ARTICLE V 5. Events of Default. If any one or more of the following events (individually, an "Event of Default") shall occur: (a) non-payment, when due, of any sums which Borrower is obligated to pay hereunder, under the Notes, or under the Loan Agreement continues unremedied for a period of five (5) days after the date such payment is due; or (b) failure of Borrower to keep in full force and effect its corporate existence, rights, franchises and privileges, except as provided for in the Loan Agreement; or (c) if an Event of Default (as defined in the Loan Agreement) shall have occurred under the Loan Agreement; or (d) if any of the representations or warranties made by Borrower in any document, instrument or certificate delivered in connection with the financing of the Property by Borrower proves to be untrue in any material respect; or (e) if a default shall have occurred under any Other Indenture and shall be continuing beyond the applicable grace or cure period provided therein; or 8 10 (f) if Borrower shall (i) voluntarily be adjudicated a bankrupt or insolvent, (ii) seek or consent to the appointment of a receiver or trustee for itself or for any portion of the Property, (iii) file a petition seeking relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, (iv) make a general assignment for the benefit of creditors, or (v) be unable to pay its debts as they mature; or (g) a court shall enter an order, judgment or decree appointing, with the consent of Borrower, a receiver or trustee for it or for any of the Property or approving a petition filed against Borrower which seeks relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, and such order, judgment or decree shall remain in force, undischarged or unstayed, sixty (60) days after it is entered; or (h) the estate or interest of Borrower in any of the Property shall be levied upon or attached in any proceeding and such estate or interest is about to be sold or transferred or such process shall not be vacated or discharged within fifteen (15) days after such levy or attachment; (i) if Borrower sells, conveys or transfers, voluntarily or otherwise, its interest in the Property without the prior written consent of Beneficiary; or (j) Any material provision of the Loan Documents relating to Trustee's and Beneficiary's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Borrower, or Borrower shall so state in writing. then, in any such event, Trustee or Beneficiary may accelerate the Indebtedness outstanding under this Indenture, and may take such other actions as may be provided under the Loan Agreement, or at law or in equity. ARTICLE VI 6. Assignment of Leases and Rents. 6.1. Assignment of Rents. As additional security hereunder, the Borrower hereby grants, bargains, conveys, assigns, transfers and sets over, and by these presents does grant, bargain, convey, assign, transfer and set over to the Beneficiary, as well as the Trustee on behalf of the Beneficiary, all Rents, if any; provided, however, that unless and until an Event of Default occurs, the Borrower will have a license to collect and retain such Rents as and when, but not before, the same shall become due and payable. Upon an Event of Default, the Beneficiary shall be immediately entitled to and may collect such Rents. In addition, upon an Event of Default, the Beneficiary, or the Trustee on the Beneficiary's behalf, may at any time and without notice, either in person or by agent or by receiver to be appointed by a court, enter and take possession of the Property or any part thereof, and in its own name, sue for or otherwise collect such Rents. The Borrower 9 11 hereby agrees with the Beneficiary that other parties under the Leases may, upon notice from the Beneficiary, or the Trustee acting on behalf of the Beneficiary, on the occurrence of an Event of Default, thereafter pay directly to the Beneficiary the Rents due and to become due under the Leases and attorn to all other obligations thereunder, directly to the Beneficiary without any obligation on their part to determine whether an Event of Default does, in fact, exist or has, in fact, occurred. All Rents collected by the Trustee or the Beneficiary shall be applied as provided in Article XII hereof; provided, however, that if the costs and expenses and attorney's fees shall exceed the amount of the Rents collected, the excess shall be added to the Indebtedness, shall bear interest at the maximum rate allowable by law as provided herein, and shall be immediately due and payable. The entering upon and taking possession of the Property, the collection of Rents, if any, and the application thereof as aforesaid, shall not cure or waive any Event of Default or notice of default, if any, hereunder, nor invalidate any act done pursuant to such notice except to the extent that such default is fully cured. Failure or discontinuance of the Trustee or the Beneficiary at any time or from time to time, to collect said Rents, shall not in any manner impair the subsequent enforcement by the Beneficiary, or the Trustee on the Beneficiary's behalf, of the right, power and authority herein conferred upon it. Nothing contained herein, nor the exercise of any right, power or authority herein granted to the Beneficiary, or the Trustee on the Beneficiary's behalf, shall be construed to be an affirmation by it of any tenancy, lease or option, nor an assumption of liability under, nor the subordination of the lien or charge of this Indenture, to any such tenancy, lease or option. ARTICLE VII 7. Remedies in Case of Event of Default. 7.1. Legal Proceedings and Foreclosure. If an Event of Default shall have occurred, Trustee or Beneficiary may proceed by suit or suits at law or in equity or by any other appropriate remedy to protect and enforce its rights hereunder, whether for the specific performance of any covenant or agreement contained herein, or for an injunction against the violation of any of the terms hereof, or in aid of the exercise of any right, power or remedy available to it, or to enforce the payment of the Indebtedness under the Loan Agreement, or to foreclose the lien and security interest of this Indenture as against all or any part of the Property and to have all or any part of the Property sold, in any manner permitted by law, under the judgment or decree of a court or courts of competent jurisdiction, or otherwise, and to pursue any other remedy available to it. If Beneficiary proceeds to foreclose the lien of this Indenture, Trustee shall have the statutory power of sale if permitted by applicable law. In the event of any such suit or proceeding, Beneficiary and/or Trustee shall comply with any local laws applicable to any such suits or proceedings. Any such suit or proceeding instituted by Trustee shall be brought in its name as Trustee and any recovery or judgment shall be for the benefit of Beneficiary. All costs and expenses (including, without limitation, reasonable attorney's fees and expenses) incurred by Trustee or Beneficiary in connection with any such suit or 10 12 proceeding, together with interest thereon (to the extent permitted by law) computed at the Default Rate from the date on which such costs or expenses are incurred to the date of payment thereof, shall constitute additional Indebtedness secured by this Indenture and shall be paid by Borrower to Trustee or Beneficiary, as the case may be, on demand. 7.2. Power of Sale and Procedure. If an Event of Default shall have occurred, Trustee, at Beneficiary's election, may sell or offer for sale the Property in such portions, order and parcels as Beneficiary may determine, with or without having first taken possession of same, to the highest bidder for cash at public auction. In exercising such power of sale, Trustee shall give such notice of hearing as to the commencement of the foreclosure proceedings and shall obtain such findings or leave at court as may then be required by applicable law and shall give such notice of such foreclosure sale and shall advertise the time and place of such sale in such manner as may then be provided by applicable law and shall comply in all respects with all laws applicable to the institution, conduct, and completion of power of sale foreclosures. Such sale shall be made in conformance with the laws of the State in which the Property is located at the courthouse door of the county wherein the Property is situated. All aspects of any power of sale foreclosure commenced by Trustee hereunder shall be accomplished in such manner as permitted or required by State law in existence on the date hereof relating to the sale of real estate and/or relating to the sale of collateral after a default by a debtor, as the same may be amended or supplemented, or by any subsequent laws relating to same. At any such sale (i) whether made under the power herein contained, State law, any other legal requirement or by virtue of any judicial proceeding or any other legal right, remedy or recourse, it shall not be necessary for Trustee to have physically present, or to have constructive possession of, the Property (Borrower hereby covenanting and agreeing to deliver to Trustee any portion of the Property not actually or constructively possessed by Trustee immediately upon demand by Trustee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to such purchaser at such sale, and (ii) the receipt of Trustee or of such other party or officer making the sale shall be a sufficient discharge to the purchaser or purchasers for his or their purchase money and no such purchaser or purchasers, or his or their assigns or personal representatives, shall thereafter be obligated to see to the application of such purchase money or be in any way answerable for any loss, misapplication or non-application thereof. 7.3. Acceleration of Maturity. If an Event of Default shall have occurred, Beneficiary may declare the entire outstanding Indebtedness under the Loan Agreement, and all other sums secured hereby, to be due and payable immediately, and upon such declaration, such Indebtedness and other sums shall immediately become and be due and payable without demand or notice. 7.4. Leases. Trustee at the option of Beneficiary is authorized to foreclose this Indenture subject to the rights of any tenants of the Property, and the failure to make any 11 13 such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, nor be asserted by Borrower to be, a defense to any proceedings instituted by Trustee and/or Beneficiary to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property. 7.5. Suits to Protect the Property. Beneficiary, or Trustee at Beneficiary's election, shall have the power and authority to institute and maintain any suits and proceedings as Beneficiary may deem advisable (a) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Indenture, (b) to preserve or protect its interest in the Property, and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Beneficiary's interest. 7.6. Discontinuance of Proceedings; Position of Parties Restored. If Beneficiary, or Trustee at Beneficiary's election, shall have proceeded to enforce any right or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to Beneficiary, then and in every such instance, Borrower and Beneficiary shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Beneficiary shall continue as if no such proceeding had occurred or had been taken. 7.7. Borrower to Pay the Indebtedness on Any Default in Payment; Application of Monies by Beneficiary. (a) If an Event of Default shall occur as a result of Borrower's failure to pay any amount due under the Loan Agreement or this Indenture, then, upon Beneficiary's demand, Borrower will pay to Beneficiary the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Borrower shall fail to pay the same forthwith upon such demand, Beneficiary, or Trustee at Beneficiary's election, shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Beneficiary's agents, attorneys and other representatives. Beneficiary shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Indenture, and the right of Beneficiary to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Indenture, or the foreclosure of the lien hereof. (b) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Beneficiary 12 14 shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. (c) Borrower hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Beneficiary and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the lien of this Indenture upon the Property or any part thereof or any lien, rights, powers or remedies of Beneficiary hereunder, but such lien, rights, powers and remedies of Beneficiary hereunder shall continue unimpaired as before. ARTICLE VIII 8.1. Purchase of the Property by Beneficiary. Beneficiary may be a purchaser of the Property or any part thereof or any interest therein at any sale thereof, whether pursuant to foreclosure, power of sale or otherwise, and may apply the Indebtedness secured hereby to the purchase price. 8.2. Title Upon Sale; Receipt a Sufficient Discharge to Purchaser. After the occurrence of an Event of Default hereunder, and upon the sale of the Property or any part thereof or any interest therein by Trustee or Beneficiary, whether pursuant to foreclosure, power of sale or otherwise, the purchaser shall acquire good title thereto, free of the lien of this Indenture and free of all rights of redemption, whether statutory, equitable or otherwise, in Borrower to the extent permitted by applicable law. The receipt of the officer making the sale under judicial proceedings or of Trustee or Beneficiary shall be sufficient discharge to the purchaser for the purchase money, and such purchaser shall not be obligated to see to the application thereof. All occupants of the Property sold or any part thereof shall become tenants at sufferance of the purchaser, and as long as a tenant is not in default under its Lease, the purchaser will not disturb the occupancy of such tenant of the Property during the term of its Lease. It shall not be necessary for the purchaser at any such sale to bring any action for possession to the Property purchased other than statutory action of forcible detainer in any justice court having jurisdiction. 8.3. Application of Indebtedness Toward Purchase Price. If Beneficiary purchases the Property pursuant to foreclosure, power of sale or otherwise, then Beneficiary may, in lieu of cash, apply all or any portion of the sums due to Beneficiary under the Loan Agreement and this Indenture or any other instrument securing the Indebtedness, to the unpaid balance of the purchase price remaining after payment of any portion of the purchase price required to be paid in cash, and the costs and expenses of the sale, compensation and other charges relating to the sale. 13 15 ARTICLE IX 9. Waiver of Appraisement, Valuation, Etc. Borrower hereby waives, to the full extent it may lawfully do so, the benefit of all appraisement, valuation, stay, moratorium, exemption from execution, extension and redemption laws now or hereafter in force and all rights of marshaling in the event of the sale of the Property or any part thereof or any interest therein. ARTICLE X 10. Appointment of Receiver. If an Event of Default shall have occurred, Trustee and/or Beneficiary shall, as a matter of right and to the fullest extent permitted by applicable law, be entitled, ex parte and without notice, to the appointment of a receiver or receivers of the Property or any part thereof, whether such receivership be incidental to a proposed sale thereof or otherwise, and Borrower hereby consents to the appointment of such a receiver or receivers and will not oppose any such appointment. The expenses, including receiver's fees, attorney's fees, costs and agent's compensation, incurred pursuant to the powers herein contained shall be secured by this Indenture. ARTICLE XI 11. Possession, Management and Income. If an Event of Default shall have occurred under this Indenture, Trustee or Beneficiary, without further notice, may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Borrower and all other Persons and any and all property therefrom, and Trustee or Beneficiary may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Trustee or Beneficiary shall be applied (a) to pay (i) the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of Trustee and all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Trustee or Beneficiary and all other costs and expenses of entering a bond and taking possession of and holding the Property, and (ii) any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge and then (b) in the manner provided in Article XII of this Indenture. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Trustee or Beneficiary shall be applied in the manner specified in Article XII of this Indenture. 14 16 ARTICLE XII 12. Application of Proceeds. The proceeds of (a) the operation and management of the Property pursuant to Article XI of this Indenture, and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, reasonable Trustee's fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Trustee and Beneficiary or in the pursuance of any remedies hereunder; Second: to the fullest extent permitted by applicable law, to any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge; Third: to any Indebtedness secured by this Indenture and at the time due and payable (whether by acceleration or otherwise; Fourth: to Beneficiary for payment of the Notes outstanding; and Fifth: the balance, if any, to Borrower. ARTICLE XIII 13. Remedies, Etc., Cumulative. Each legal, equitable or contractual right, power or remedy of Trustee and Beneficiary now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Trustee or Beneficiary of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. ARTICLE XIV 14. No Waiver, Etc. No failure by Trustee or Beneficiary to insist upon the strict performance of any term hereof or to exercise any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Indenture or under the Loan Agreement during the continuance of any Default shall constitute a waiver thereof. No waiver of any breach shall affect or alter this Indenture which shall continue in full force and effect with respect to any other then existing or subsequent breach. 15 17 ARTICLE XV 15. Trustee. (a) All the rights, powers and remedies of Beneficiary hereunder may be exercised by Trustee. Trustee shall not be under any obligation to exercise any trust or power vested in him by this Indenture unless Beneficiary shall have offered Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred by Trustee in compliance herewith. Trustee shall not be liable with respect to any action taken or omitted to be taken by Trustee in accordance with the written directions of Beneficiary, except for Trustee's own bad faith, willful misconduct or negligence. Trustee shall not be required to ascertain or inquire as to the performance or observance of any of the covenants or agreements of Borrower herein, and in the absence of written notice from Borrower or Beneficiary stating that a Default has occurred and specifying the same, Trustee may conclusively assume that no Default exists. (b) Trustee may, with consent of Beneficiary, consult with counsel (which may be counsel for Borrower) and the written advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by him hereunder in good faith and in accordance therewith. (c) Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys. (d) Any moneys received by Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. (e) Beneficiary may, by instrument in writing, filed in the office or offices where this Indenture has been recorded, and at any time or from time to time, and without notice and without specifying any reason therefor, and without applying to any court, remove Trustee and select a successor trustee or trustees in the event of the death, removal, resignation, refusal to act, or inability to act of Trustee or, in its sole discretion, for any reason whatsoever. Trustee so ceasing to act shall duly assign, transfer and deliver any of the property and monies held by such Trustee to the successor appointed in Trustee's place. All powers, rights and duties and authority of Trustee shall thereupon become vested in the successor. The successor shall not be required to give bond or make an oath for the faithful performance of his duties unless required by Beneficiary. (f) Trustee may resign by the giving of notice of such resignation in writing to Beneficiary. (g) If more than one Trustee is appointed under this Indenture, all rights granted to and all powers conferred upon Trustee hereunder may be exercised by both or either of Trustees. 16 18 (h) All reasonable expenses, charges, counsel fees and other disbursements incurred by Trustee in and about the administration of this Indenture and executed in the performance of its duties and powers hereunder shall be secured by this Indenture. ARTICLE XVI 16. Right of Trustee or Beneficiary to Perform Covenants, Etc. If Borrower shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Trustee or Beneficiary, without notice to or demand upon Borrower and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Borrower and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Trustee or Beneficiary, may be necessary or appropriate therefor. All sums so paid by Trustee or Beneficiary and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Indebtedness secured by this Indenture and shall be paid by Borrower to Trustee or Beneficiary on demand. ARTICLE XVII 17. Certificate as to No Default, Etc.; Information. At any time and from time to time, Borrower will deliver to Beneficiary, promptly upon request, a certificate signed by a duly authorized officer of Borrower stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Borrower is taking or proposes to take with respect thereto. Borrower will also furnish promptly to Beneficiary, such information with respect to the Property and the Leases as may from time to time be requested. ARTICLE XVIII 18. Additional Instruments. Borrower, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Trustee or Beneficiary from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Indenture or intended so to be. ARTICLE XIX 19. Defeasance. This Indenture and the lien created hereby shall terminate after the payment in full of (a) all the Indebtedness and (b) all other sums secured hereby. Upon such termination, and upon surrender of this Indenture for cancellation, Beneficiary shall 17 19 release, without warranty, the Property then subject to the lien hereof to the Persons entitled thereto. The recitals in any reconveyance executed under this Indenture of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such release may be described as "the person or persons legally entitled thereto". Trustee and/or Beneficiary, at Borrower's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the lien created hereby, and (b) any other security held by Trustee and/or Beneficiary and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Indenture. ARTICLE XX 20. Applicable Law; Severability. (a) This Indenture shall be governed by and construed in accordance with the laws of the State. (b) All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Indenture invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Indenture shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. ARTICLE XXI 21. Miscellaneous. This Indenture (a) may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and (b) shall be binding upon Borrower, its successors and assigns, and all Persons claiming under or through Borrower or any such successor or assign, and shall inure to the benefit of and be enforceable by Trustee and its successors and Beneficiary and its successors and assigns. The headings in this Indenture are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All agreements between Borrower and Beneficiary, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Beneficiary exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Beneficiary in excess of the maximum lawful amount, and if in any circumstance Beneficiary shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, and if permitted by applicable law, 18 20 an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Borrower. All interest paid or agreed to be paid to Beneficiary shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Borrower and Beneficiary. This Indenture may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. Portions of the Property consist of goods which are, or are to become, fixtures relating to the Land and Borrower expressly covenants and agrees that the filing of this Indenture in the real estate records of the county where the Property is located shall also operate from the time of filing therein as a financing statement filed as a fixture filing in accordance with Article 9 of the State's Uniform Commercial Code - Secured Transactions. ARTICLE XXII 22. Change in Method of Taxation. In the event of the passage, after the date of this Indenture, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Beneficiary in the Property, this Indenture or the Loan Agreement, Borrower shall, upon demand, bear and pay the full amount (or any partial amount) requested by Beneficiary, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE XXIII 23. Trustee's Acceptance. Trustee accepts the trust created hereby when this Indenture, duly executed and acknowledged, is made a public record in the State and county where the Property is located, as provided by the laws of the State. ARTICLE XXIV 24. No Petition. Trustee and Beneficiary hereby covenant and agree that they will not institute against, or join any Person in instituting against Borrower, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law at any time other than on a date which is at least one (1) year and one (1) day after the payment in full of the Notes; provided, however, that nothing in this Article shall constitute a waiver of any right to indemnification, reimbursement or other payment from Borrower pursuant to the Loan Agreement. 19 21 ARTICLE XXV 25. Indenture Secures Future Advances. This Indenture is given to secure not only the amount initially secured by this Indenture, but also such future advances, whether such advances are obligatory or are to be made at the option of Trustee or Beneficiary, or otherwise, as are made within fifteen (15) years from the date hereof, to the same extent as if such future advances were made on the date of the execution of this Indenture. The total amount of advances outstanding and presently secured hereby is Eighty-six Million Dollars ($86,000,000.00). The Loan Agreement currently provides Borrower with a revolving line of credit up to $150,000,000.00. However, pursuant to Section 2.11 of the Loan Agreement, Borrower may request an increase to the Loan Amount up to $200,000,000.00 upon approval of the Lenders as set forth therein. Any such increase to the Loan Amount shall constitute a future advance and shall be secured by this Indenture to the same extent as if such future advance was made on the date of the execution of this Indenture. This Indenture secures a revolving line of credit under which Advances may be made, repaid, and reborrowed on a revolving basis as provided for in the Loan Agreement. ARTICLE XXVI 26. Approval of Legal Description. Borrower has read and does hereby approve the legal description of the Land which Is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Trustee and Beneficiary and their attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XXVII 27. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Indenture and the Loan Agreement, the Loan Agreement shall control. The Loan Agreement contains provisions permitting Borrower to obtain releases of portions of the Property from this Indenture from time to time. ARTICLE XXVIII 28. WAIVER OF JURY TRIAL. BORROWER, TRUSTEE, AND BENEFICIARY, BY THEIR ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER BORROWER, TRUSTEE, AND BENEFICIARY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS DEED OF TRUST, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG BORROWER, TRUSTEE OR BENEFICIARY RELATED 20 22 THERETO. NONE OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY BORROWER, TRUSTEE, AND BENEFICIARY, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR TRUSTEE AND BENEFICIARY TO MAKE THE LOAN TO TRUSTOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 21 23 IN WITNESS WHEREOF, Borrower has caused this Indenture to be executed and attested by its proper officers thereunto duly authorized, as of the day and year first above written and has executed the same in order that this Indenture may qualify as a financing statement under the Uniform Commercial Code of the State as to such of the Property, if any, constitutes personalty. KOGER EQUITY, INC., Attest: a Florida corporation By:/s/ W. Lawrence Jenkins By: /s/ G. Danny Edwards - -------------------------------- -------------------------- Name: W. Lawrence Jenkins Name: G. Danny Edwards --------------------------- ------------------------ Its: Secretary Title: Treasurer ---------------------------- ----------------------- [AFFIX CORPORATE SEAL] STATE OF Georgia: ------- COUNTY OF Camden: ------- I, Dee Price, a Notary Public of the County of Camden, State of Georgia, do hereby certify that W. Lawrence Jenkins , personally appeared before me this day and acknowledged that he/she is the Secretary of KOGER EQUITY, INC., a Florida corporation, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its Treasurer, sealed with its corporate seal, and attested by himself as its Secretary. Witness my hand and official seal this 30th day of December, 1998. Dee Price ------------------------------------- Notary Public Notary Public, Camden County, Georgia My commission expires: Feb. 1, 1999 [NOTARIAL SEAL] 22 24 EXHIBIT A The Land 25 EXHIBIT B Permitted Encumbrances EX-10.(K)(5)(B)(II) 24 AMENDED & RESTATED ASSIGNMENT OF LEASES & RENTS 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(K)(5)(B)(II) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS --------------------------------------------------- THIS AMENDED AND RESTATED ASSIGNMENT OF LEASES AND RENTS (this "Assignment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. R E C I T A L S: A. Assignor is the mortgagor under that certain Amended and Restated Deed of Trust, Assignment of Leases and Rents and Security Agreement given by Assignor to Assignee dated of even date herewith and recorded or to be recorded in the public records of Mecklenburg County, North Carolina (the "Deed of Trust"); securing the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes", as such term is defined in the Loan Agreement), encumbering certain real property interests located in Mecklenburg County, North Carolina, as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Assignment for the purposes set forth herein. 1 3 C. This Assignment amends and restates that certain Assignment of Leases and Rents recorded in Official Records Book 9430, Page 249, of the public records of Mecklenburg County, North Carolina, which Assignment of Leases and Rents was assigned to Assignee pursuant to that certain Assignment of Deed of Trust and Related Loan Documents of even date herewith to be recorded in the public records of Mecklenburg County, North Carolina. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title and interest in, to and under any and all present and future leases of or in the Premises ("Leases") and any and all rents, revenues, issues and profits (including Assignor's interest in any security deposits relating thereto) arising out of or accruing from the Leases whether now or hereafter due ("Rents"), said Leases and Rents being deemed part of the security for the indebtedness herein mentioned and are encumbered, transferred and conveyed by this Assignment, and in furtherance thereof, does hereby covenant and agree with Assignee as follows: 1. Assignor will notify Assignee in writing (but without any right of approval or denial on the part of Assignee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement). 2. Assignor will, at its cost and expense, observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Assignor or its agents under the Leases, and will use its reasonable best efforts in the exercise of sound business judgment to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Assignor will not do or permit to be done anything to impair the security hereof, including without limitation the execution of any other assignment of Assignor's interest in the Leases or the Rents, without Assignee's prior written consent. 3. This Assignment is intended to operate as an absolute and immediate assignment of the Leases and the Rents; however, unless and until a default occurs under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignor will have a license to collect the Rents as and when the same become due and payable. Assignor hereby agrees that the respective tenants under the Leases, upon notice from Assignee of the occurrence of a default hereunder, will thereafter pay to Assignee the Rents due and to become due under the Leases without any obligation to determine whether or not such a default does in fact exist. Assignor, without written approval of Assignee, will not collect 2 4 or accept Rent for more than one (1) month in advance; provided, however, Assignor may accept Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five percent (5%) of the Rent collected during the applicable month. 4. Upon payment in full of the principal sum and interest, of the Notes, this Assignment shall become and be void and of no effect. Assignor hereby authorizes and directs the lessees named in said Leases or any other or future lessees or occupants of the Premises described therein or in the Deed of Trust upon receipt from the Assignee of written notice to the effect that Assignee is then the holder of the Notes and the Deed of Trust and that a default exists thereunder or under the Assignment, to pay over to the Assignee all rents, income, profits and revenues hereby assigned and to continue so to do until otherwise notified by Assignee. 5. This Amended and Restated Assignment of Leases and Rents as provided herein will not be deemed or construed to constitute Assignee as a mortgagee in possession of the Premises nor to obligate Assignee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Assignor under any Lease, or for the control, care, management, or repair of the Premises; nor will it operate to make Assignee, except in the event of Assignee's negligence, recklessness or wilful misconduct, responsible or liable for any waste committed on the Premises by the tenants or any other parties or for any dangerous or defective condition of the Premises, or for any act or omission relating to the management, upkeep, repair, or control of the Premises that results in loss or injury or death to any person. Except in the event of Assignee's negligence, recklessness or wilful misconduct, Assignee will not be liable for any loss sustained by Assignor resulting from Assignee's failure to lease the Premises after default or from any other act or omission of Assignee in managing the Premises after default. Assignor will and does hereby indemnify and agree to hold harmless Assignee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this Assignment of Leases (except as a result of Assignee's gross negligence or willful misconduct) and, to the extent that a claim is made against Assignee prior to the time Assignee takes possession of the Premises, from any and all claims and demands whatsoever which may be asserted against Assignee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases. Should Assignee incur any such liability under the Leases or by reason of this Amended and Restated Assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Assignor will reimburse Assignee therefor immediately upon demand and upon the failure of Assignor so to do, Assignee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Assignor as an advance under the Notes and secured by this Assignment. 6. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Assignee of the remedies provided for by law or by the Notes, the Deed of Trust or this Assignment, the lessee thereunder will, upon request of 3 5 any person succeeding to the interest of Assignor as a result of such enforcement, automatically become the lessee of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month or two (2) months in advance (as applicable in accordance with Paragraph 3 above). The Leases are and at all times shall be subject and subordinate in all respects to the Deed of Trust, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of the Deed of Trust, to the full extent of all principal, interest and all other amounts secured thereby. Provided that a tenant is not in default under its Lease, Assignee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of the Deed of Trust, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided in the Deed of Trust, or pursuant to the laws of the State of North Carolina. If requested by a tenant or Assignor under any of the Leases or upon Assignee's request, Assignor and Assignee shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Assignee) with such tenant whereby Assignee will agree to not disturb the tenant in its possession of the Premises provided such tenant is not in default under its Lease and the tenant will agree to attorn to Assignee if Assignee takes possession of the Premises. 7. Upon a default under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignee may at its option, without notice and without regard to the adequacy of the security for the obligations set forth in the Notes, either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Premises, to have, hold, manage, lease and operate the same on such terms and for such period of time as Assignee may deem proper, and either with or without taking possession of the Premises in its own name, demand and receive the Rents in the possession of Assignor at the time of Assignee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Assignee, and to apply such Rents to the payment of: (a) all reasonable expenses of managing the Premises, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Assignee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Assignee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Premises and protecting and preserving the same; or (b) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Assignee in its sole discretion may determine, any custom or use to the contrary notwithstanding. 8. This Assignment is made and accepted without prejudice to any of the rights and remedies possessed by Assignee under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust, and the right of Assignee to exercise its remedies under this Assignment may be exercised by Assignee either prior to, 4 6 simultaneously with, or subsequent to any action taken by it under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust. Each and every right, remedy and power granted to Assignee by this Assignment will be cumulative and in addition to any other right, remedy and power given by the remaining terms and conditions of the Notes, the Loan Agreement, the Deed of Trust or this Assignment, or now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this Assignment, and no act done or omitted by Assignee pursuant to the powers and rights granted it hereunder, nor the failure of Assignee to avail itself of any of the rights and remedies under this Assignment, will be construed or deemed to be a waiver of any of Assignee's rights and remedies under this Assignment, nor will such exercise or omission to exercise of the powers and rights granted Assignee hereunder be deemed to constitute a waiver of its rights and remedies under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust. 9. Assignee may take or release other security for the payment of the indebtedness under the Notes and the Deed of Trust, may release any party primarily or secondarily liable therefor, and may apply any other security held by it to the satisfaction of such indebtedness without prejudice to any of its rights under this Assignment. 10. The term "Lease" or "Leases" as used herein, means said Leases hereby assigned or any extension or renewal thereof, and any leases subsequently executed during the term of this Assignment covering the Premises or any part thereof. At Assignee's request, Assignor will assign and transfer to Assignee any and all subsequent leases upon all or any part of the Premises and to execute and deliver at the request of Assignee all such further assurances and assignments in the Premises as Assignee will require from time to time in its sole discretion. 11. This Assignment, together with the covenants and warranties therein contained, shall inure to the benefit of Assignee and any subsequent holder of the Notes and the Deed of Trust shall be binding upon Assignor, their successors, executors, personal representatives, and assigns, and any subsequent owner of the Premises. 12. This Assignment shall expire and terminate upon the payment in full of the Notes and any other Indebtedness secured by the Deed of Trust and any cancellation, satisfaction or release of the Deed of Trust shall constitute a cancellation, satisfaction, or release of this Assignment. In the event that a specific property is released from the lien of the Deed of Trust, then such property and the Leases relating to it shall, effective with the release, also be released from this Assignment. 13. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR 5 7 ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. IN WITNESS WHEREOF, Assignor has executed this Assignment under seal the day and year first above written. ASSIGNOR: KOGER EQUITY, INC., Attest: a Florida corporation By: /s/ W. Lawrence Jenkins By: /s/ G. Danny Edwards ------------------------ ------------------------------- Name: W. Lawrence Jenkins Name: G. Danny Edwards Its: Secretary ----------------------------- ----------------------- Title: Treasurer ---------------------------- [AFFIX CORPORATE SEAL] ASSIGNEE: FIRST UNION NATIONAL BANK, a Attest: national association, as Agent By: /s/ Lynn E. Vermilva By: /s/ Andrew J. Hogshead ------------------------- ------------------------------- Name: Lynn E. Vermilva Name: J. Andrew Hogshead ----------------------- ---------------------------- Its: Vice President Secretary Title: Vice President ----------------------- ---------------------------- [AFFIX CORPORATE SEAL] 6 8 STATE OF Georgia: ------- COUNTY OF Camden: ------- I, Dee Price, a Notary Public of the County of Camden, State of Georgia, do hereby certify that W. Lawrence Jenkins, personally appeared before me this day and acknowledged that he/she is the Secretary of KOGER EQUITY, INC., a Florida corporation, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its Treasurer, sealed with its corporate seal, and attested by himself/herself as its Secretary. Witness my hand and official seal this 30th day of December, 1998. /s/ Dee Price ---------------------------------- Notary Public Notary Public, Camden County, Georgia My commission expires: Feb. 1, 1999 [NOTARIAL SEAL] STATE OF Florida: ------- COUNTY OF Duval: ------ I, Nancy Hoffmann, a Notary Public of the County of Duval, State of Florida, do hereby certify that Lynn E. Vermilva, personally appeared before me this day and acknowledged that he/she is the Vice President. of FIRST UNION NATIONAL BANK, a national association, and that by authority duly given and as an act of the corporation, the foregoing instrument was signed in its name by its J. Andrew Hogshead, its Vice President, sealed with its corporate seal, and attested by herself as its Vice President. Witness my hand and official seal this 30th day of December, 1998. /s/ Nancy Hoffmann ------------------------------------------ Notary Public My commission expires: September 3, 2000 Bonded Thru Notary Public Underwriters [NOTARIAL SEAL] 7 9 EXHIBIT A LEGAL DESCRIPTION OF PREMISES 8 EX-10.(K)(5)(B)(III) 25 AMENDED & RESTATED MORTGAGE ASSGN OF LEASES & RENT 1 EXHIBIT 10(k)(5)(b)(iii) THIS INSTRUMENT PREPARED BY AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- AMENDED AND RESTATED MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT 2 AMENDED AND RESTATED MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT THIS AMENDED AND RESTATED MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT (this "Mortgage"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Mortgagor"), whose mailing address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256-9220 Attention: J.C. Teagle, President, to FIRST UNION NATIONAL BANK, a national association, as Agent (the "Mortgagee") for the Lenders under that certain Second Amended and Restated Revolving Credit Loan Agreement (the "Loan Agreement"), and all successors and assigns of Mortgagee. For purposes of notices permitted or required to be given hereunder, the Mortgagee's mailing address is One First Union Center, 301 S. College Street, Attention: REIT Banking Group, Charlotte, North Carolina 28202. Capitalized terms not otherwise defined herein are defined in Article I. WITNESSETH: THIS MORTGAGE WITNESSETH that Mortgagor made and delivered that certain Mortgage, Assignment of Leases and Rents and Security Agreement to First Union National Bank, a national banking association, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank, F.S.B., a federal savings bank, as mortgagees, thereunder dated as of December 29, 1997, and recorded in Mortgage Book 2979, Page 0338, of the public records of Greenville County, South Carolina (the "Original Mortgage"), which Original Mortgage was assigned to Mortgagee pursuant to that certain Assignment of Mortgage and Related Loan Documents of even date herewith to be recorded in the public records of Greenville County, South Carolina (the "Assignment"); THIS MORTGAGE WITNESSETH, that the Original Mortgage partially secured the Obligations of Mortgagor under that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement"); THIS MORTGAGE WITNESSETH, that the Mortgagor and the Mortgagee have entered into the Loan Agreement as of even date herewith, pursuant to which the Prior Loan Agreement has been modified to increase the Loan to $150,000,000 and to modify other terms and conditions therein; 1 3 THIS MORTGAGE WITNESSETH, that to secure (A) the payment, performance and observance of all obligations of Mortgagor and all Obligations heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other Obligations which this Mortgage by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to Mortgagee, as agent for the benefit of the Lenders (as defined in the Loan Agreement), (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of Obligations secured hereby, other than for future advances made pursuant to Paragraph 9 hereof, shall in no event exceed $150,000,000.00 (the "Obligations"); and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement, and in consideration of the aforesaid, Mortgagor does hereby mortgage, grant a security interest in, bargain, sell, alien, remise, release, convey and confirm unto Mortgagee, its successors and assigns, the following property and rights whether now owned or hereafter acquired by Mortgagor (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the ("Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) All fixtures, machinery, equipment and other personal property of all types owned by Mortgagor now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including, but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Mortgagor's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Obligations; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right 2 4 to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Mortgagor, to appear in and defend any action or proceeding brought with respect to Mortgagor's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Mortgagee in the Land, the Improvements or the Fixtures; TO HAVE AND TO HOLD the Property and all parts, rights, members and appurtenances thereof, for the use, benefit and behoof of Mortgagee, IN FEE SIMPLE forever. PROVIDED ALWAYS and these presents are upon the express condition that if Mortgagor will pay to Mortgagee the Obligations from time to time evidenced and secured by the Notes and will promptly and fully perform, execute and complete each and every covenant, agreement, obligation, condition and stipulation contained in this Mortgage and the Notes, then this Mortgage and the estate hereby created will cease and be null and void and cancelled of record; otherwise the same will remain in full force and effect. MORTGAGOR, FOR ITSELF AND FOR ITS SUCCESSORS AND ASSIGNS, HEREBY WARRANTS, REPRESENTS, COVENANTS AND AGREES WITH MORTGAGEE THAT THE ORIGINAL MORTGAGE IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY AS FOLLOWS: ARTICLE I 1. Definitions. As used in this Mortgage, the following capitalized terms shall have the meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation. "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Paragraph 5 of this Mortgage. 3 5 "Fixtures" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "FUNB" shall mean First Union National Bank, a national association. "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, documentary stamp tax, intangible taxes, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Mortgagor, Mortgagee or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Land" shall mean those certain parcels of real property located in the County of Greenville, State of South Carolina, as more particularly described in Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Lenders" shall mean FUNB, AmSouth, GFB, Citizens, and Compass, and any other Lenders from time to time under the Loan Agreement. "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith between Mortgagor and Mortgagee. "Loan Documents" shall mean this Mortgage, the Loan Agreement, the Notes, the Security Deeds, the Lease Assignments, the Assignments of Contracts, the Indemnification Agreement, and any other instrument, document, affidavits, or certificates given by Mortgagor to the Mortgagee for the benefit of the Lenders in support of, or evidencing or securing, the Loan. 4 6 "Mortgagee" shall have the meaning assigned to such term in the introductory paragraph of this Mortgage. "Mortgage" shall mean this Amended and Restated Mortgage, Assignment of Leases and Rents, and Security Agreement. "Mortgagor" shall have the meaning assigned to such term in the introductory paragraph of this Mortgage. "Notes" shall mean the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of FUNB in the original principal amount of $45,000,000, the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of AmSouth in the original principal amount of $35,000,000, the Substitution Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of GFB in the original principal amount of $35,000,000, the Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of Citizens in the original principal amount of $20,000,000, and the Revolving Promissory Note dated as of even date herewith made by Mortgagor payable to the order of Compass in the original principal amount of $15,000,000. "Obligations" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Other Mortgage" shall mean any mortgage, deed to secure debt, or deed of trust given by Mortgagor to or in favor of Mortgagee to secure the Obligations, other than this Mortgage. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "Rents" shall have the meaning assigned to such term in the Granting Clause of this Mortgage. "State" shall mean the State of South Carolina. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as 5 7 the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. ARTICLE II 2. Representatives and Warranties Regarding Mortgage. Mortgagor represents and warrants to Mortgagee as follows: (a) It will timely pay and perform the Obligations when due; (b) It has full power, authority and legal right to execute and deliver this Mortgage and to grant a mortgage of the Property; (c) It holds good and marketable fee simple title to the Property; (d) It has the legal right to convey and encumber the Property subject to the Permitted Encumbrances and, at its expense, will warrant to Mortgagee and will defend its title to the Property and the estate created by this Mortgage against all claims and demands, and will maintain and preserve such estate so long as the Obligations secured by this Mortgage remains outstanding, subject, however, to the Permitted Encumbrances; and (e) This Mortgage constitutes a valid first mortgage of the Property, subject to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Mortgage and the estate created hereby shall terminate in accordance with Paragraph 14.6 hereof, Mortgagor shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Mortgage and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the estate created hereby and the rights of Mortgagee hereunder. Mortgagor shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance; (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end; 6 8 (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the sale shall be contested in good faith and by appropriate proceedings by Mortgagor in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that Mortgagee is otherwise in compliance with the Loan Agreement. Upon the written request of Mortgagee from time to time, Mortgagor will furnish to Mortgagee official receipts or other satisfactory proof evidencing such payments. In addition, Mortgagor will pay all utility charges as required by the Loan Agreement. Mortgagor shall not be entitled to any credit on the Obligations, by reason of the payment of any Imposition or utility charges or any part thereof; (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Mortgagor in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvements and the Fixtures, or any part of either thereof; (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Mortgagee any certificates or evidence of such insurance as required under the Loan Agreement; (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Mortgagor shall give immediate written and oral notice thereof to Mortgagee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Mortgagee shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Mortgagor would be entitled thereto under the Loan Agreement, and Mortgagor hereby irrevocably assigns to Mortgagee all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Mortgagor will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Mortgagee. At the sole cost and expense of Mortgagor, Mortgagee may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Mortgagee in connection with, any claim or the claims payment process. Mortgagor will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Mortgagee shall be applied in accordance with the provisions of the Loan Agreement; and 7 9 (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Mortgagee of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. (h) Corporate Existence. Preserve and keep in full force and effect its corporate existence, rights and franchises and privileges as a corporation under the laws of the State of South Carolina and comply with all laws applicable to it, and do or cause to be done all things necessary to preserve and to keep in full force and effect its right to own property in the State of South Carolina. (i) Inspection. Permit the Mortgagee or its authorized representatives to inspect the Property during usual business hours. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Mortgagee, Mortgagor will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Mortgagee therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Mortgage; (ii) the Permitted Encumbrances; (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement; (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement; and (v) liens arising out of or created by any statute, the discharge of which cannot order the terms of such statute at the particular time be effected by Mortgagor; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Mortgagor shall have the right to grant, without the prior consent of Mortgagee, any utility easement. ARTICLE V 5. Events of Default. Any of the following events (each a "Default") shall, following the passage of any grace or cure period as provided below, constitute an Event of Default ("Event of Default"): (a) Mortgagor shall fail to make any payment of principal under any of the Notes on or before the same becomes due and payable on maturity thereof; or Mortgagor shall fail to make any payment of interest under any of the Notes, or any fees, costs or expenses due hereunder or thereunder, within 5 days after the same becomes due and payable; (b) Any representation or warranty made by Mortgagor (or any of its officers) under or in connection with any Loan Document shall be or become incorrect or untrue, or shall prove to have been incorrect or misleading in any material respect when made; 8 10 (c) Mortgagor shall fail to perform or observe any term, covenant or agreement (other than a covenant of payment) contained in any Loan Document on its part to be performed or observed, and such failure shall remain uncured for 10 days after written notice thereof shall have been given by Mortgagee to Mortgagor, or if such failure cannot by its nature be cured within 10 days after written notice thereof shall have been given by Mortgagor and shall fail to complete such cure within 60 days after Mortgagee's initial written notice of such failure; (d) An involuntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced against Mortgagor, and such case or proceeding shall not be dismissed in 60 days; or a court shall enter an order, appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator, supervisor, rehabilitator (or similar official) of Mortgagor or for any substantial part of its property, or ordering the winding-up, supervision or liquidation of its affairs; (e) Mortgagor shall commence a voluntary case or proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case or proceeding under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator, supervisor, rehabilitator (or other similar official) of Mortgagor or for any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its indebtedness generally as the same becomes due, or shall take any corporate action in furtherance of any of the foregoing; (f) A judgment or order for the payment of money in excess of $2,500,000 shall be rendered against Mortgagor and either (A) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (B) there shall be any period of 10 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; (g) A Default has occurred and is continuing beyond any applicable grace or cure period under any Debt (other than the Loan) in excess of $2,500,000.00; (h) Any material provision of the Loan Documents relating to Mortgagee's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Mortgagor, or Mortgagor shall so state in writing; and (i) This Mortgage shall, as a result of Mortgagor's acts or omissions, for any reason, except to the extent permitted by the terms thereof, cease to create a valid and, upon filing of UCC-1 financing statement(s), UCC-2 Notice Filings, or UCC-3 continuation statements, as applicable, perfected first priority security interest in any of the Collateral purported to be covered, which can be so secured or perfected. 9 11 ARTICLE VI 6. Remedies in Case of Event of Default. Upon the occurrence of Default, the following remedies are available, without limitation, to Mortgagee: (a) Mortgagee may exercise all of Mortgagee's remedies under this Mortgage or other Loan Documents including, without limitation, acceleration of maturity of all payments and Obligations which shall immediately become due and payable without demand or notice; (b) Mortgagee may take immediate possession of the Property or any part thereof (which Mortgagor agrees to surrender to Mortgagee) and manage, control or lease the same to such persons and at such rental as it may deem proper and collect and apply Rents as provided herein. The taking of possession shall not prevent concurrent or later proceedings for the foreclosure sale of the Property; (c) Mortgagee may apply to any court of competent jurisdiction for the appointment of a receiver for all purposes including, without limitation, to manage and operate the Property or any part thereof, and to apply the net Rents therefrom to the payment of any of the Obligations. In event of such application, Mortgagor consents to the appointment of a receiver, and agrees that a receiver may be appointed without notice to Mortgagor, without regard to the adequacy of any security for the Obligations, and without regard to the solvency of Mortgagor or any other person, firm or corporation who or which may be liable for the payment of the Obligations; (d) All the remedies of a mortgagee and a secured party as provided by law and in equity including, without limitation, foreclosure upon this Mortgage and sale of the Property, or any part of the Property, at a public sale conducted according to applicable law (referred to as "Sale") and conduct additional Sales as may be required until all of the Property is sold or the Obligations are satisfied; (e) Mortgagee may bid at Sale and may accept, as successful bidder, credit of the bid amount against the Obligations as payment of any portion of the purchase price; (f) Mortgagee shall apply the proceeds of Sale, first to any fees or attorney fees permitted Mortgagee by law in connection with Sale, second to expenses of foreclosure, publication, and sale permitted Mortgagee by law in connection with Sale, third to the Obligations, and any remaining proceeds as required by law; (g) Mortgagee is authorized to foreclose this Mortgage subject to the rights of any tenants of the Property, and the failure to make any such tenants parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, a defense to any proceedings instituted by Mortgagee to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property; (h) Mortgagee shall have the power and authority to institute and maintain any suits and proceedings as Mortgagee may deem advisable (i) to prevent any impairment of 10 12 the Property by any acts which may be unlawful or any violation of this Mortgage, (ii) to preserve or protect its interest in the Property, and (iii) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to Mortgagee's interest; (i) If Mortgagee shall have proceeded to enforce any right or remedy under this Mortgage by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, then and in every such instance, Mortgagor and Mortgagee shall, except to the extent modified by such proceedings, be restored to their former positions and rights hereunder, and all rights, powers and remedies of Mortgagee shall continue as if no such proceeding had occurred or had been taken; (j) Upon Mortgagee's demand, Mortgagor will pay to Mortgagee the whole amount due and payable under the Loan Agreement and all other sums secured hereby. If Mortgagor shall fail to pay the same forthwith upon such demand, Mortgagee shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of Mortgagee's agents, attorneys and other representatives. Mortgagee shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Mortgage, and the right of Mortgagee to recover such judgment shall not be affected by any taking of possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Mortgage, or the foreclosure of the estate created hereby; (k) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, Mortgagee shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. Mortgagor hereby agrees, to the extent permitted by law, that no recovery of any such judgment by Mortgagee and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the estate created hereby upon the Property or any part thereof or any lien, rights, powers or remedies of Mortgagee hereunder, but such lien, rights, powers and remedies of Mortgagee hereunder shall continue unimpaired as before; and (l) Mortgagee may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Mortgagor and all other Persons and any and all property therefrom, and Mortgagee may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect 11 13 thereto. Any amounts so received by Mortgagee shall be applied to pay the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Mortgagee and all other costs and expenses of entering a bond and taking possession of and holding the Property, and then in the manner provided in Article VII of this Mortgage. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Mortgagee shall be applied in the manner specified in Article VII of this Mortgage. ARTICLE VII 7. Application of Proceeds. The proceeds of (a) of the operation and management of the Property; and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Mortgagee or in the pursuance of any remedies hereunder; Second: to any lien prior to the estate created hereby which Mortgagee may consider it necessary or desirable to discharge; Third: to any Obligations secured by this Mortgage and at the time due and payable (whether by acceleration or otherwise); Fourth: to Mortgagee for payment of the Notes outstanding; and Fifth: the balance, if any, to Mortgagor. ARTICLE VIII 8. Change in Method of Taxation. In the event of the passage, after the date of this Mortgage, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Mortgagee in the Property, this Mortgage or the Loan Agreement, Mortgagor shall, upon demand, bear and pay the full amount (or any partial amount) requested by Mortgagee, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. 12 14 ARTICLE IX 9. Future Advances. This Mortgage is given to secure not only existing Obligations, but also future advances made within fifteen (15) years of the date of this Mortgage to the same extent as if such future advances are made on the date of the execution of this Mortgage. The principal amount (including any swap agreements and future advances) that may be so secured may decrease or increase from time to time, but the total amount so secured at any one time shall not exceed twice the face amount of the Notes, plus all interest, costs, reimbursements, fees and expenses due under this Mortgage and secured, hereby. Mortgagor shall not execute any document that impairs or otherwise impacts the priority of any future advances secured by this Mortgage. ARTICLE X 10. Assignment of Leases and Rents. Mortgagor hereby grants, transfers and assigns to Mortgagee Mortgagor's entire right, title and interest in and to the Leases and Rents. This assignment of Leases and Rents by Mortgagor to Mortgagee is intended to operate as an absolute and immediate assignment of such Leases and Rents. 10.1. Mortgagor's Representations and Warranties Regarding Assignment of Leases and Rents. Mortgagor represents and warrants to Mortgagee as follows: (a) Mortgagor has good and lawful right, title and interest in and to the Leases, is entitled to receive the Rents from the Leases and from the Property, has full power and authority to assign the Leases as provided herein and to grant to and confer upon Mortgagee the powers, interests and authority set forth herein, and has not assigned the Leases or Rents to any other party; (b) Mortgagor has neither done any act nor omitted to do any act which might prevent Mortgagee from, or limit Mortgagee in, acting under any of the provisions of this assignment of Leases and Rents; (c) All Leases provide for Rent to be paid monthly, in advance, and Mortgagor has not accepted and will not accept payment of Rent for more than one (1) month in advance; provided, however, Mortgagor may accept payment of Rent two (2) months in advance if such Rent accepted two (2) months in advance does not exceed five (5%) percent of the Rent collected during the applicable month; and there are no agreements, understandings, or undertakings by Mortgagor providing for free or reduced Rent in the past or in the future except as provided in the Leases; (d) Except as disclosed to Mortgagee in writing, Mortgagor is not now in default, the nature of which could have a material adverse impact on the financial condition of Mortgagor or the value of the Property, under any provision of any of the Leases, and no tenant under any of the Leases has claimed or asserted any defense, offset, counter-claim, or abatement of rent, and that the Leases remain in full force and effect. Mortgagor further 13 15 represents and warrants that it has no knowledge of any default by any tenant under any of the Leases that could materially adversely affect the value of the Property; (e) This Assignment of Leases and Rents, the Leases, the performance of each and every covenant of Mortgagor under the Leases, and the enforcement by Mortgagee of its rights hereunder does not conflict with, or will not conflict with, and does not constitute or will not constitute a breach or default, under any agreement, Mortgage or other instrument to which Mortgagor is a party, or so far as is known to Mortgagor, any law, ordinance, administrative regulation or court decree which is applicable to Mortgagor; and (f) No action has been brought or, so far as is known to Mortgagor, is threatened, which could interfere in any way with the right of Mortgagor to execute and deliver this assignment of Leases and Rents, and to perform all of Mortgagor's obligations contained in this assignment of Leases and Rents and in the Leases; and (g) to Mortgagor's knowledge, the Leases are valid, enforceable and in full force and effect. 10.2. Mortgagor's Covenants Regarding Assignment of Leases and Rents. Mortgagor hereby covenants and agrees to and with Mortgagee as follows: (a) Mortgagor will notify Mortgagee in writing (but without any right of approval or denial on the part of Mortgagee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement); (b) Mortgagor hereby acknowledges that any and all Rents collected or received by Mortgagor after the occurrence of an Event of Default will be the property of Mortgagee, which if received and collected by Mortgagor, will be considered received and collected on Mortgagee's behalf and as Mortgagee's agent, and will be held by Mortgagor in trust for the benefit of Mortgagee, and Mortgagor will deliver all such sums to Mortgagee immediately upon Mortgagor's request therefor; (c) In accordance with sound business judgment, Mortgagor will use its reasonable best efforts, at its cost and expense, to observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Mortgagor or its agents under the Leases, and will use its best efforts, in accordance with sound business judgment, to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Mortgagor will not do or permit to be done anything to impair the security thereof, including without limitation the execution of any other assignment or Mortgagor's interest in the Leases or the Rents, without Mortgagee's prior written consent; 14 16 (d) Mortgagor authorizes and directs each and every present and future tenant under the Leases to pay all Rent to Mortgagee upon receipt of written demand from Mortgagee to so pay the same, and upon paying the same, such tenants will be relieved from all liability to Mortgagor for such Rental in all respects. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Mortgagee of the remedies provided for by law or by this assignment of Leases and Rents, the tenant thereunder will, upon request of any person succeeding to the interest of Mortgagor as a result of such enforcement, automatically become the tenant of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month in advance; (e) This Assignment of Leases and Rents will not obligate Mortgagee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Mortgagor under any Lease, or for the control, care, management, or repair of the Property; nor will it operate to make Mortgagee responsible or liable for any waste committed on the Property by the tenants or any other parties or for any dangerous or defective condition of the Property, or for any act or omission relating to the management, upkeep, repair, or control of the Property that results in loss or injury or death to any person. Mortgagee will not be liable for any loss sustained by Mortgagor resulting from Mortgagee's failure to lease the Property after default. Mortgagor will and does hereby indemnify and agree to hold harmless Mortgagee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this assignment of Leases and Rents and from any and all claims and demands whatsoever which may be asserted against Mortgagee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases except to the extent the same is caused by the negligence of Mortgagee. Should Mortgagee incur any such liability under the Leases or by reason of this assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorney and paralegal fees and costs, will be secured hereby and Mortgagor will reimburse Mortgagee therefor immediately upon demand and upon the failure of Mortgagor so to do, Mortgagee may, at this option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Mortgagor as an advance under the Notes; and (f) This assignment of Leases and Rents is made without prejudice to any of the rights and remedies possessed by Mortgagee under the Loan Agreement, and the right of Mortgagee to exercise its remedies under this assignment of Leases and Rents may be exercised by Mortgagee either prior to, simultaneously with, or subsequent to any action taken by it under the Loan Agreement. Each and every right, remedy and power granted to Mortgagee by this assignment of Leases and Rents will be cumulative and in addition to any other right, remedy and power given by the Loan Agreement now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this assignment of Leases and Rents, and no act done or omitted by Mortgagee pursuant to the powers and rights granted it hereunder, nor the failure of Mortgagee to avail itself of 15 17 any of the rights and remedies under this assignment of Leases and Rents, will be construed or deemed to be a waiver of any of Mortgagee's rights and remedies under this assignment of Leases and Rents, nor will such exercise or omission to exercise of the power and rights granted Mortgagee hereunder be deemed to constitute a waiver of its rights and remedies under the Loan Agreement. 10.3. Mortgagee's Covenants Regarding Assignment of Leases and Rents. Mortgagee hereby covenants and agrees to and with Mortgagor as follows: (a) Although this assignment of Leases and Rents constitutes a present and absolute assignment of the Leases and the Rents, so long as there is no Event of Default on the part of Mortgagor, Mortgagee will not require that such Rents be paid directly to Mortgagee, and Mortgagor will have a license to collect and use the Rents for subsequent application as provided above; and (b) Upon the payment and performance in full of Mortgagor's obligations under the Loan Agreement, as evidenced by the recording or filing of an instrument of satisfaction or termination of this Mortgage without the recording of another security instrument in favor of Mortgagee affecting the Property, this assignment of Leases and Rents will be deemed terminated and released of record by Mortgagee and thereupon will be null and void and of no further force or effect. 10.4. Further Assurances. At Mortgagee's request, Mortgagor will assign and transfer to Mortgagee any and all subsequent Leases upon all or any part of the Property and to execute and deliver at the request of Mortgagee all such further assurances and assignments in the Leases and the Rents as Mortgagee will require from time to time in its sole discretion. 10.5. Subordination, Nondisturbance and Attornment. The Leases are and at all times shall be subject and subordinate in all respects to this Mortgage, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of this Mortgage, to the full extent of all principal, interest and all other amounts secured hereby. Provided that a tenant is not in default under its Lease, Mortgagee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of this Mortgage, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided herein, or pursuant to the laws of the State of South Carolina. If requested by a tenant under any of the Leases or upon Mortgagee's request, Mortgagor shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Mortgagee) with such tenant whereby Mortgagee will agree to not disturb the tenant in its possession of the Property provided such tenant is not in default under its Lease and the tenant will agree to attorn to Mortgagee if Mortgagee takes possession of the Property. 16 18 ARTICLE XI 11. Security Agreement. (a) This Mortgage is hereby made and declared to be a security agreement, encumbering each and every item of personal property included herein, in compliance with the provisions of the Uniform Commercial Code as enacted in the State. A financing statement or statements reciting this Mortgage to be a security agreement, affecting all of said personal property aforementioned, shall be executed by Mortgagor and appropriately filed. The remedies for any violation of the covenants, terms and conditions of the security agreement herein contained shall be (i) as prescribed herein, or (ii) as prescribed by general law, or (iii) as prescribed by the specific statutory consequences now or hereafter enacted and specified in said Uniform Commercial Code, all at Mortgagee's sole election. Mortgagor and Mortgagee agree that the filing of such financing statement(s) in the records normally having to do with personal property shall never be construed as in any way derogating from or impairing this declaration and hereby stated intention of Mortgagor and Mortgagee that everything used in connection with the production of income from the Property and/or adapted for use therein and/or which is described or reflected in this Mortgage, is, and at all times and for all purposes and in all proceedings both legal or equitable shall be, regarded as part of the Property irrespective of whether (i) any such item is physically attached to the improvements, (ii) serial numbers are used for the better identification of certain items capable of being thus identified in a recital contained herein, or (iii) any such item is referred to or reflected in any such financing statement(s) of the rights in and to (aa) the proceeds of any fire and/or hazard insurance policy, or (bb) any award in eminent domain proceeds for a taking or for loss of value, or (cc) Mortgagor's interest as lessor in any present or future lease or rights to income growing out of the use and/or occupancy of the Property, whether pursuant to lease or otherwise shall never be construed as in any way altering any of the rights of Mortgagee as determined by this instrument impugning the priority of Mortgagee's estate granted hereby or by any other recorded document, but such mention in such financing statement(s) is declared to be for the protection of Mortgagee in the event any court shall at any time hold with respect to the foregoing (aa), (bb) or (cc), that notice of Mortgagee's priority of interest to be effective against a particular class of persons, must be filed in the Uniform Commercial Code records. (b) Mortgagor warrants that (i) Mortgagor's (that is "Debtor's") name, identity or corporate structure and residence or principal place of business are as set forth in Exhibit C hereto; (ii) Mortgagor (that is, "Debtor") has been using or operating under said name, identity or corporate structure without change for the time period set forth in Exhibit C hereto; and (iii) the location of the collateral is upon the Property. Mortgagor covenants and agrees that Mortgagor will furnish Mortgagee with notice of any change in the matters addressed by clauses (i) or (iii) of this subparagraph (b) within thirty (30) days of the effective date of any such change and Mortgagor will promptly execute any financing statements or other instruments deemed necessary by Mortgagee to prevent any filed financing statement from becoming misleading or losing its perfected status. 17 19 (c) The information contained in this subparagraph (c) is provided in order that this Mortgage shall comply with the requirements of the Uniform Commercial Code, as enacted in the State of South Carolina, for instruments to be filed as financing statements. The names of the "Debtor" and the "Secured Party," the identity or corporate structure and residence or principal place of business of "Debtor," and the time period for which "Debtor" has been using or operating under said name and identity or corporate structure without change, are as set forth in Exhibit C attached hereto and by this reference made a part hereof; the mailing address of the "Secured Party" from which information concerning the security interest may be obtained, and the mailing address of "Debtor" are as set forth in Exhibit C attached hereto; and a statement indicating the types, or describing the items, of collateral are set forth hereinabove. ARTICLE XII 12. Approval of Legal Description. Mortgagor has read and does hereby approve the legal description of the Land which is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Mortgagee and its attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XIII 13. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Mortgage and the Loan Agreement, the Loan Agreement shall control. ARTICLE XIV 14. Miscellaneous. The following miscellaneous provisions shall apply: 14.1. Each legal, equitable or contractual right, power or remedy of Mortgagee now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Mortgagee of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. 14.2. No failure by Mortgagee to insist upon the strict performance of any term hereof or to exercise of any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Mortgage or under the Loan Agreement during the continuance of any Default shall affect or alter this Mortgage which shall continue in full force and effect with respect to any other then existing or subsequent breach. 18 20 14.3. If Mortgagor shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Mortgagee, without notice to or demand upon Mortgagor and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Mortgagor and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Mortgagee, may be necessary or appropriate therefor. All sums so paid by Mortgagee and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Obligations secured by this Mortgage and shall be paid by Mortgagor to Mortgagee on demand. 14.4. At any time and from time to time, Mortgagor will deliver to Mortgagee, promptly upon request, a certificate signed by a duly authorized officer of Mortgagor stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Mortgagor is taking or proposes to take with respect thereto. Mortgagor will also furnish promptly to Mortgagee, such information with respect to the Property and the Leases as may from time to time be requested. 14.5. Mortgagor, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Mortgagee from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Mortgage or intended so to be. 14.6. This Mortgage and the estate created hereby shall terminate after the payment in full of (a) all the Obligations and (b) all other sums secured hereby. Upon such termination and upon surrender of this Mortgage for cancellation, Mortgagee shall release the Property then subject to the estate created hereby to the Persons entitled thereto. The recitals in any satisfaction executed under this Mortgage of any matters of fact shall be conclusive proof of the truthfulness thereof. The Mortgagee in such release may be described as "the person or persons legally entitled thereto." Mortgagee, at Mortgagor's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the estate created hereby, and (b) any other security held by Mortgagee and such satisfaction and termination, and such instruments, when duly 14.7. executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Mortgage. 14.8. This Mortgage shall be governed by and construed in accordance with the laws of the State. 14.9. All rights, power and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to 19 21 be limited to the extent necessary so that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Mortgage shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. 14.10. This Mortgage may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and shall be binding upon Mortgagor, its successors and assigns, and all Persons claiming under or through Mortgagor or any such successor or assign, and shall inure to the benefit of and be enforceable by Mortgagee and its successors and assigns. 14.11. The headings in this Mortgage are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. 14.12. All agreements between Mortgagor and Mortgagee, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Mortgagee exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Mortgagee in excess of the maximum lawful amount, and if in any circumstance Mortgagee shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Mortgagor. All interest paid or agreed to be paid to Mortgagee shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Mortgagor and Mortgagee. 14.13. This Mortgage may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. ARTICLE XV 15. WAIVER OF MORTGAGOR'S RIGHTS. BY EXECUTION OF THIS MORTGAGE, MORTGAGOR EXPRESSLY (A) ACKNOWLEDGES THE RIGHT TO ACCELERATE THE OBLIGATIONS SECURED HEREBY; AND (B) ACKNOWLEDGES THAT MORTGAGOR HAS READ THIS MORTGAGE AND ANY AND ALL QUESTIONS REGARDING THE LEGAL EFFECT OF THIS MORTGAGE AND ITS PROVISIONS HAVE BEEN EXPLAINED FULLY TO MORTGAGOR AND MORTGAGOR HAS CONSULTED WITH COUNSEL OF MORTGAGOR'S CHOICE PRIOR TO EXECUTING THIS MORTGAGE. 20 22 ARTICLE XVI 16. WAIVER OF JURY TRIAL. MORTGAGOR AND MORTGAGEE, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER MORTGAGOR NOR MORTGAGEE, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS MORTGAGE, THE NOTES, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN MORTGAGOR AND MORTGAGEE RELATED THERETO. NEITHER OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY MORTGAGOR AND MORTGAGEE, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR MORTGAGEE TO MAKE THE LOAN TO MORTGAGOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 21 23 IN WITNESS WHEREOF, Mortgagor has caused this Mortgage to be executed, sealed, and attested by its proper officers thereunto duly authorized, as of the day and year first above written. WITNESSES: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long - ----------------------------- Name: Janice R. Long By: /s/ G. Danny Edwards (SEAL) ------------------------ -------------------------------------- Name: G. Danny Edwards --------------------------------- Title: Treasurer /s/ Alan C. Sheppard, Jr. ------------------------------- - ----------------------------- Name: Alan C. Sheppard, Jr. ------------------------ STATE OF Georgia ) ) PROBATE COUNTY OF Camden ) PERSONALLY appeared before me the undersigned witness who after first being duly sworn, deposes and says that s/he saw the within-named KOGER EQUITY, INC., by G. Danny Edwards, its Treasurer, sign seal and as its act and deed, deliver the within-written Mortgage, Assignment of Leases and Rents, and Security Agreement for the uses and purposes therein mentioned, and that s/he together with the other witness whose signature appears above, witnessed the execution thereof. /s/ Janice R. Long ---------------------- WITNESS SWORN TO BEFORE ME THIS 30th day of December, 1998. - ---- /s/ Dee Price (L.S.) - --------------------------------------------- Notary Public for Georgia My commission expires: Feb. 1, 1999 ----------------------- Notary Public, Camden County, Georgia 22 24 EXHIBIT A The Land 25 EXHIBIT B Permitted Encumbrances 26 EXHIBIT C DEBTOR NAME: Koger Equity, Inc. CORPORATE STRUCTURE: a Florida corporation PRINCIPAL PLACE 3986 Boulevard Center Drive #101 OF BUSINESS: Jacksonville, Florida 32207 TIME PERIOD USING June 21, 1988, to present NAME WITHOUT CHANGE SECURED PARTY NAME: First Union National Bank, as Agent PRINCIPAL PLACE 301 South College Street OF BUSINESS: Charlotte, North Carolina 28288 EX-10.(K)(6)(A) 26 AMENDMENT TO ASSIGNMENT OF LEASES & RENTS 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(6)(a) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 - -------------------------------------------------------------------------------- AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS THIS AMENDMENT TO ASSIGNMENT OF LEASES AND RENTS (this "Amendment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith (the "Loan Agreement") which terms Assignor and Assignee, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. For purposes of notices permitted or required to be given hereunder, Assignee's mailing address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. RECITALS: A. Assignor is the mortgagor under that certain Mortgage, Assignment of Leases and Rents and Security Agreement given by Assignor to the mortgagees defined therein, dated December 29, 1997, and recorded in Official Records Book 2979, Page 338, of the public records of Greenville County, South Carolina (the "Mortgage"), which Mortgage secured that certain (i) Substitution Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of First Union National Bank ("FUNB") in the principal amount of $35,000,000; (ii) Substitution Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of Morgan Guaranty Trust Company of New York in the principal amount of $15,000,000; (iii) Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of AmSouth Bank ("AmSouth") in the principal amount of $25,000,000, and (iv) Revolving Promissory Note dated December 29, 1997 made by Assignor payable to the order of Guaranty Federal Bank, F.S.B. ("GFB") in the principal amount of $25,000,000 (collectively, the "Prior Notes"), encumbering certain real property interests located in Greenville County, South Carolina as more particularly described on attached Exhibit A (the "Premises"). B. To further secure the payment and performance of the Prior Notes, Assignor agreed to execute and deliver to Assignee that certain Assignment of Leases and Rents dated as of December 29, 1997, which was recorded in Official Records Book 1737, Page 981, of the public records of Greenville County, South Carolina (the "Assignment"), which Assignment was assigned to Assignee pursuant to that certain Assignment of Mortgage and Related Loan Documents of even date herewith to be recorded in the public records of Greenville County, South Carolina. 1 3 C. The Mortgage has been modified and amended pursuant to that certain Amended and Restated Mortgage, Assignment of Leases and Rents and Security Agreement of even date herein, to be recorded in the Public Records of Greenville County, South Carolina to increase the Indebtedness secured thereby to $150,000,000 evidenced by those certain: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Grantor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes"). D. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Amendment for the purposes set forth herein. E. Assignor and Assignee desire to amend the Assignment to set forth that the loan evidenced by the Prior Notes has been modified, amended, and extended as evidenced by the Notes defined above. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows: 1. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. The Assignment is hereby amended to secure the payment, discharge, and performance of the Notes, and all references in the Assignment to the "Notes" are hereinafter deemed to refer to the "Notes" of even date herewith as defined herein. 3. All references in the Assignment to the "Loan Agreement" shall be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement of even date herewith. 4. The term "Assignee" as defined in the Assignment, is hereby deemed to refer to First Union National Bank, as Agent for the Lenders, which Lenders are defined in the Loan Agreement. 5. Except as herein expressly amended, the Assignment is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 2 4 6. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Assignment. 7. This Amendment may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. 8. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS AMENDMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 3 5 IN WITNESS WHEREOF, Assignor and Assignee have executed this Amendment under seal the day and year first above written. ASSIGNOR: WITNESSES: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long - ------------------------------ Name: Janice R. Long By: /s/ G. Danny Edwards ------------------------- ---------------------------------- Name: G. Danny Edwards -------------------------------- Title: Treasurer ------------------------------ /s/ Alan C. Sheppard, Jr. - ------------------------------ Name: Alan C. Sheppard, Jr. [AFFIX CORPORATE SEAL] ------------------------- ASSIGNEE: WITNESSES: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan C. Sheppard, Jr. - ------------------------------ Name: Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead ------------------------- ---------------------------------- Name: J. Andrew Hogshead -------------------------------- Title: Vice President ------------------------------- /s/ Janice R. Long - ------------------------------ Name: Janice R. Long [AFFIX CORPORATE SEAL] ------------------------- 4 6 STATE OF Georgia ) ) PROBATE COUNTY OF Camden ) PERSONALLY appeared before me the undersigned witness who after first being duly sworn, deposes and says that s/he saw the within-named KOGER EQUITY, INC., by G. Danny Edwards, its Treasurer, sign seal and as its act and deed, deliver the within-written Amendment to Assignment of Leases and Rents for the uses and purposes therein mentioned, and that s/he together with the other witness whose signature appears above, witnessed the execution thereof. /s/ Janice R. Long -------------------------------------- WITNESS SWORN TO BEFORE ME THIS 30th day of December, 1998. - ---- /s/ Dee Price (L.S.) - ------------------------------------------------------ Notary Public for Georgia ------------------------------------- Notary Public, Camden County, Georgia My commission expires: Feb. 1, 1999 -------------------------------- 5 7 STATE OF Florida ) ) PROBATE COUNTY OF Duval ) PERSONALLY appeared before me the undersigned witness who after first being duly sworn, deposes and says that s/he saw the within-named FIRST UNION NATIONAL BANK, a national association, by J. Andrew Hogshead, its Vice President, sign seal and as its act and deed, deliver the within-written Amendment to Assignment of Leases and Rents for the uses and purposes therein mentioned, and that s/he together with the other witness whose signature appears above, witnessed the execution thereof. /s/ Janice R. Long ---------------------------------- WITNESS SWORN TO BEFORE ME THIS 30th day of December, 1998. - ---- /s/ Nancy Hoffmann (L.S.) - ------------------------------------- Notary Public for Florida ------------------------- My commission expires: September 3, 2000 Bonded Thru Notary Public Underwriters 6 8 EXHIBIT A LEGAL DESCRIPTION OF PREMISES EX-10.(K)(6)(B) 27 AMEND TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT 1 EXHIBIT 10(k)(6)(b) AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - -------------------------------------------------------------------------------- AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT - -------------------------------------------------------------------------------- THIS AMENDMENT TO ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Amendment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Agent (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank F.S.B., a federal savings bank (collectively, the "Original Lenders") entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, Borrower provided the Original Lenders with that certain Mortgage, Assignment of Leases and Rents and Security Agreement dated as of December 29, 1997, and recorded in Official Records Book 2979, page 338 of the public records of Greenville County, South Carolina (the "Mortgage"), wherein Borrower granted to the Original Lenders a security interest in certain real property located in Greenville County, South Carolina and described therein (the "Property") as security for the Loan. 3. As a condition precedent to and as a material inducement for the Original Lenders' agreement to provide the Loan to Borrower, the Original Lenders required Borrower to execute and deliver that certain Environmental Indemnification Agreement dated as of December 29, 1997 covering the Property (the "Environmental Agreement"), which Environmental Agreement was assigned to Agent pursuant to that certain Assignment of Mortgage and Related Loan Documents of even date herewith. 1 3 4. Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Mortgage. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Environmental Agreement is modified in accordance with the terms and conditions hereinafter set forth. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" or "Lenders" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders under and as defined in the Loan Agreement. 3. Additional Promissory Notes. All references to the term "Notes" as utilized in the Environmental Agreement shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of the Lenders, as applicable. 4. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith between Borrower and First Union National Bank, as Agent for the Lenders. All references to the term "Loan" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 5. Amended and Restated Mortgage. All references to the term "Mortgage" as utilized in the Environmental Agreement shall hereinafter be deemed to refer to that certain Amended and Restated Mortgage, Assignment of Leases and Security Agreement from Borrower to Agent of even date herewith, and to be recorded in the public records of Greenville County, South Carolina. 2 4 6. Ratification. Except as herein expressly amended, the Environmental Agreement is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 7. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Environmental Agreement. 8. Counterparts. This Amendment may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written. Signed, sealed and delivered in the BORROWER: presence of: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long - ----------------------------------- Print Name: Janice R. Long By: /s/ G. Danny Edwards ------------------------------ Name: G. Danny Edwards ---------------------------- /s/ J A Hoener Title: Treasurer - ----------------------------------- --------------------------- Print Name: James A. Hoener ------------------------ [CORPORATE SEAL] LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan C. Sheppard, Jr. By: /s/ Andrew J. Hogshead - ----------------------------------- ------------------------------ Print Name: Alan C. Sheppard, Jr. Name: J. Andrew Hogshead ------------------------ ---------------------------- Title: Vice President --------------------------- /s/ Nancy Hoffmann [CORPORATE SEAL] - ----------------------------------- Print Name: Nancy Hoffmann ----------------------- 3 EX-10.(K)(6)(C) 28 AMEND TO ASSIGN OF CONTRACTS LICENSES & PERMITS 1 EXHIBIT 10(k)(6)(c) AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - -------------------------------------------------------------------------------- AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS - -------------------------------------------------------------------------------- THIS AMENDMENT TO ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS (this "Assignment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256, Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Agent"), for the Lenders (as such term is defined in the Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith, as amended from time to time, between Borrower and Lender (the "Loan Agreement"). RECITALS 1. Borrower and Agent, Morgan Guaranty Trust Company of New York, a New York banking corporation, AmSouth Bank, a state banking corporation, and Guaranty Federal Bank F.S.B., a federal savings bank (collectively, the "Original Lenders") entered into that certain Amended and Restated Revolving Credit Loan Agreement dated as of December 29, 1997 (the "Prior Loan Agreement") pursuant to which the Original Lenders agreed to extend certain credit to the Borrower from time to time up to a maximum principal amount of $100,000,000 (the "Loan"). 2. As partial security for the Loan, the Borrower provided the Original Lenders with that certain Mortgage, Assignment of Leases and Rents and Security Agreement dated as of December 29, 1997, and recorded in Book 2979, page 338, of the public records of Greenville County, South Carolina (the "Mortgage"), wherein the Borrower granted to the Original Lenders a security interest in certain real property described therein as security for the Loan. 3. As additional collateral for repayment of the Loan, Borrower made and delivered to the Original Lenders that certain Assignment of Contracts, Licenses and Permits dated December 29, 1997 (the "Assignment of Contracts"), which Assignment of Contracts was assigned to Agent pursuant to that certain Assignment of Mortgage and Related Loan Documents of even date herewith. 3 4. The Borrower has applied to the Agent to increase the amount of the Loan to $150,000,000 and to resyndicate the Loan to additional lenders in order to finance such increase, and to modify certain other provisions of the Mortgage. The Agent and the other Original Lenders have agreed to such modifications, provided, among other things, that the Assignment of Contracts is modified in accordance with the terms and conditions hereinafter set forth. ACCORDINGLY, in consideration of the mutual covenants, promises and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Recitals. The recitals hereinabove are true and correct and are incorporated herein by reference. 2. Additional Lenders. All references to the term "Lender" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to First Union National Bank, as Agent for the Lenders. 3. Additional Promissory Notes. All references to the term "Notes" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer collectively to those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes all of even date herewith from Borrower to each of Lenders. 4. Amendment to Loan Agreement. All references to the term "Loan Agreement" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to that certain Second Amended and Restated Revolving Credit Loan Agreement dated of even date herewith between Borrower and Lender. All references to the term "Loan" as utilized in the Assignment of Contracts shall hereinafter be deemed to refer to the Loan evidenced by the Second Amended and Restated Loan Agreement. 5. Ratification. Except as herein expressly amended, the Assignment of Contracts is hereby ratified and confirmed and shall otherwise remain unchanged and in full force and effect. 6. Capitalized Terms. All initial capitalized defined terms not defined herein shall have the meanings assigned to them in the Assignment of Contracts. 2 4 7. Counterparts. This Agreement may be executed in separate counterpart signature pages, and all such counterparts taken together shall constitute but one and the same instrument. 8. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, THE AGENT, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO BORROWER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. 3 5 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their authorized officers as of the day and year first above written. Signed, sealed and delivered in the BORROWER: presence of: KOGER EQUITY, INC., a Florida corporation /s/ Janice R. Long - ----------------------------------- By: /s/ G. Danny Edwards Print Name: Janice R. Long ------------------------------ ------------------------ Name: G. Danny Edwards --------------------------- Title: Treasurer --------------------------- /s/ J. A. Hoener - ----------------------------------- [CORPORATE SEAL] Print Name: James A. Hoener ------------------------ LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent /s/ Alan Sheppard - ----------------------------------- By: /s/ Andrew J. Hogshead Print Name: Alan Sheppard ------------------------------ ----------------------- Name: J. Andrew Hogshead --------------------------- Title: Vice President --------------------------- /s/ Nancy Hoffmann - ----------------------------------- [CORPORATE SEAL] Print Name: Nancy Hoffmann ------------------------ 4 EX-10.(K)(7)(A) 29 DEED OF TRUST ASSIGNMENT OF LEASES & RENTS 1 THIS INSTRUMENT PREPARED BY, EXHIBIT 10(k)(7)(a) AND FOLLOWING RECORDING RETURN TO: ALAN C. SHEPPARD, JR., ESQ. LEBOEUF, LAMB, GREENE & MACRAE, L.L.P. 50 NORTH LAURA STREET, SUITE 2800 JACKSONVILLE, FLORIDA 32202 DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT FROM KOGER EQUITY, INC. TO JAMES W. ROSE, AS TRUSTEE FOR THE BENEFIT OF FIRST UNION NATIONAL BANK, AS AGENT Dated as of December 30, 1998 2 DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT (this "Indenture"), dated as of December 30, 1998, from KOGER EQUITY, INC., a Florida corporation ("Trustor"), whose mailing address is 3986 Boulevard Center Drive, Suite 101, Jacksonville, Florida 32207 Attention: J.C. Teagle, President, to JAMES W. ROSE, ("Trustee") having an address c/o First Union National Bank, a national association, 301 South College Street, Charlotte, North Carolina 28288, as trustee for the benefit of FIRST UNION NATIONAL BANK, a national association, as Agent on behalf of the Lenders (the "Beneficiary") under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith, as amended from time to time (the "Loan Agreement"). For purposes of notices permitted or required to be given hereunder, the Beneficiary's mailing address is One First Union Center, 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. Capitalized terms not otherwise defined herein are defined in Article I. WITNESSETH: TO SECURE (A) the payment, performance and observance of all obligations of Trustor and all indebtedness heretofore or hereafter from time to time advanced under the Loan Agreement and the payment of any and all other indebtedness which this Indenture by its terms secures including, without limitation, the payment of principal and interest on the Notes which shall (1) be payable to each of the Lenders, (2) be payable in full not later than December 30, 2001, and (3) bear interest at a floating rate as set forth in Section 2.6 of the Loan Agreement; provided, that the maximum aggregate principal amount of indebtedness secured hereby, other than for advances made pursuant to Article XXVIII, Paragraph 28 hereof, shall in no event exceed $150,000,000.00 (the "Indebtedness") and (B) the performance of the covenants and agreements contained herein and in the Loan Agreement. NOW, THEREFORE, THIS INDENTURE WITNESSETH, in consideration of the aforesaid Indebtedness and the trust referred to and created below Trustor hereby irrevocably grants, bargains and sells, conveys, transfers, assigns, sets over, mortgages, hypothecates, pledges and grants to Trustee and its successors and assigns IN TRUST WITH POWER OF SALE in and to all of Trustor's right, title and interest in the following 1 3 property and rights whether now owned or hereafter acquired by Trustor (collectively, the "Property"): (i) the Land; (ii) all buildings, structures and other improvements presently situated or hereafter constructed on the Land (collectively, the "Improvements"); (iii) all rights, privileges, tenements, hereditaments, rights of way, easements, rights and appurtenances belonging to or in any way relating to either the Land or the Improvements; (iv) all fixtures, machinery, equipment and other personal property of all types owned by Trustor now or hereafter affixed to and used in connection with the operation of the Land and Improvements, together with all additions and accessions thereto, substitutions therefor and replacements (collectively, the "Fixtures"); (v) all awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Land, the Improvements or the Fixtures, whether from the exercise of the right of eminent domain (including but not limited to any transfer made in lieu of or in anticipation of the exercise of said right), or for a change of grade of any street, or for any other injury to or decrease in the value of Trustor's rights, title or interest in and to the Land, the Improvements or the Fixtures; (vi) all leases and other agreements affecting the use, enjoyment or occupancy of the Land, the Improvements or the Fixtures now or hereafter entered into (the "Leases") and rents, revenues, issues and profits from the Land, the Improvements or the Fixtures (the "Rents") and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Indebtedness; (vii) all proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements or the Fixtures, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Land, the Improvements or the Fixtures; and (viii) the right, in the name and on behalf of Trustor, to appear in and defend any action or proceeding brought with respect to Trustor's right, title or interest in and to the Land, the Improvements or the Fixtures and to commence any action or proceeding to protect the interest of Beneficiary in the Land, the Improvements or the Fixtures; 2 4 TO HAVE AND TO HOLD the Property unto Trustee and its successors and assigns, forever; IN TRUST NEVERTHELESS to its own proper use and benefit forever, upon the terms and trusts herein set forth for the benefit and security of Beneficiary. This Indenture is a deed of trust of real property and a security agreement covering the Fixtures under the Uniform Commercial Code of the State. Upon the occurrence of an Event of Default, Trustee and Beneficiary shall, in addition to other rights and remedies granted to them, have all the rights granted to secured parties pursuant to the Uniform Commercial Code of the State. Trustor, for itself and for its successors and assigns, covenants and agrees with Trustee and with Beneficiary as follows: ARTICLE I 1. Definitions. As used in this Indenture, the following capitalized terms have the respective meanings set after them, such definitions to be applicable equally to the singular and plural forms of such terms: "AmSouth" shall mean AmSouth Bank, a state banking corporation. "Beneficiary" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Citizens" shall mean Citizens Bank of Rhode Island, a Rhode Island financial institution. "Compass" shall mean Compass Bank, an Alabama banking corporation "Default" shall mean any condition or event which constitutes or which would constitute an Event of Default either with or without notice or lapse of time, or both. "Default Rate" shall have the meaning assigned to such term in the Loan Agreement. "Event of Default" shall have the meaning assigned to such term in Article V of this Indenture. "FUNB" shall mean First Union National Bank, a national association. "Fixtures" shall have the meaning assigned to such term in clause (iv) of the Granting Clause of this Indenture. 3 5 "GFB" shall mean Guaranty Federal Bank, F.S.B., a federal savings bank. "Governmental Requirements" shall have the meaning assigned to such term in the Loan Agreement. "Impositions" shall mean, collectively, all taxes of every kind and nature (including real and personal property, income withholding, profits and gross receipts taxes), all charges for any easement or agreement maintained for the benefit of any of the Property, all general and special assessments, levies, permits, inspection and license fees, all water and sewer rents and other utility charges, all ground rents, and all other public charges whether of a like or different nature, even if unforeseen or extraordinary, imposed upon or assessed against Trustor, Beneficiary or any portion of the Property as a result of or arising in respect of the acquisition, occupancy, leasing, use or possession thereof, or any activity conducted on the Property (including, without limitation, any gross income tax, sales tax or excise tax levied by any governmental body on or with respect to the Rents). "Improvements" shall have the meaning assigned to such term in clause (ii) of the Granting Clause of this Indenture. "Indebtedness" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Indenture" shall mean this Deed of Trust, Assignment of Leases and Rents and Security Agreement. "Land" shall mean those certain parcels of real property located in the County of Bexar, State of Texas, as more particularly described on Exhibit A attached hereto and incorporated herein. "Leases" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "Lenders" shall mean FUNB, GFB, AmSouth, Compass, and Citizens, and any other Lenders under the Credit Agreement from time to time. "Loan Agreement" shall mean that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 between Trustor and Beneficiary. "Loan Documents" shall mean collectively the Notes, the Loan Agreement, this Indenture, and the Security Deeds, the Assignments of Leases, the Assignments of Contracts, the Indemnification Agreements, as such terms are defined in the Loan Agreement and any and all other loan documents executed in connection with the Loan. 4 6 "Notes" shall mean collectively (i) the Substitution Revolving Promissory Note dated as of even date herewith made by Trustor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Trustor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Trustor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Trustor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Trustor payable to the order of Compass in the original principal amount of $15,000,000. "Other Indenture" shall mean any mortgage, deed to secure debt, or deed of trust given by Trustor to or in favor of Trustee or Beneficiary to secure the Indebtedness, other than this Indenture. "Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements listed as exceptions to title as set forth on Exhibit B attached hereto and incorporated herein. "Person" shall mean any corporation, natural person, joint venture, partnership, business trust, joint stock company, trust, unincorporated organization, government or any department, agency or political subdivision thereof. "Property" shall have the meaning assigned to such term in the Granting Clause of this Indenture. "Rents" shall have the meaning assigned to such term in clause (vi) of the Granting Clause of this Indenture. "State" shall mean the State of Texas. "Taking" shall mean a taking or voluntary conveyance during the term hereof of all or part of the Property, or any interest therein or right accruing thereto or use thereof, as the result of or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain. "Trustee" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. "Trustor" shall have the meaning assigned to such term in the introductory paragraph of this Indenture. 5 7 ARTICLE II 2. Representations and Warranties. Trustor represents and warrants to Trustee for the benefit of Beneficiary that (a) it has full power, authority and legal right to execute and deliver this Indenture and to grant a first deed of trust of the Property, (b) it holds indefeasible fee simple title to the Land and good title to the balance of the Property, (c) this Indenture constitutes a valid first deed of trust of the Property, subject to the Permitted Encumbrances, and (d) the Leases are in full force and effect in accordance with their respective terms, have not been canceled or modified, and have not been assigned or encumbered except to Beneficiary pursuant to this Indenture and the Loan Agreement, and, to the best of Trustor's knowledge, no default exists under the Leases. Trustor, at its expense, will warrant to Trustee and to Beneficiary and will defend its title to the Property and the lien thereon created by this Indenture against all claims and demands, and will maintain and preserve such lien so long as the Indebtedness secured by this Indenture remains outstanding, subject, however, to the Permitted Encumbrances. ARTICLE III 3. Affirmative Covenants. Until this Indenture and the lien created hereby shall terminate in accordance with Article XXI, Trustor shall comply with the following covenants: (a) Recordation, Filing, Etc. At all times cause this Indenture and each amendment or modification hereof or supplement hereto (and such financing statements covering the Property under the Uniform Commercial Code as in effect in the State as may be necessary or appropriate) to be recorded, registered and filed and kept recorded, registered and filed in such manner and in such places as appropriate, and comply with all applicable statutes and regulations, in order to establish, preserve and protect the lien of this Indenture as a first lien on the Property and the rights of Trustee and Beneficiary hereunder. Trustor shall pay, or shall cause to be paid, all taxes, fees and other charges incurred in connection with such recording, registration, filing and compliance. (b) Maintenance and Repairs. Keep and maintain the Property in good order, repair and operating condition (ordinary wear and tear excepted) and make all repairs and replacements necessary to that end. (c) Payment of Impositions and Utility Charges. Pay all Impositions while the same may be paid without fine, penalty, interest or additional cost, unless the same shall be contested in good faith and by appropriate proceedings by Trustor in the manner permitted by the Loan Agreement. Any Impositions which are payable in installments may be paid in installments provided that the Trustor is otherwise in compliance with the Loan Agreement. Upon the written request of Beneficiary from time to time, Trustor will furnish to Beneficiary official receipts or other satisfactory proof evidencing such payments. In addition, Trustor will pay all utility charges as required by the Loan Agreement. Trustor 6 8 shall not be entitled to any credit on the Indebtedness, by reason of the payment of any Imposition or utility charges or any part thereof. (d) Compliance with Governmental Requirements. Promptly (i) comply with all Governmental Requirements unless the same shall be contested in good faith and by appropriate proceedings by Trustor in the manner permitted by the Loan Agreement, and (ii) procure, maintain and comply with all licenses or other authorizations required for any use of the Property then being made, and for the proper erection, installation, operation, repair and maintenance of the Improvement and the Fixtures, or any part of either thereof. (e) Insurance. Maintain insurance of the types and in the amounts required by, and otherwise complying with the Loan Agreement and promptly deliver, or cause to be promptly delivered, to Beneficiary any certificates or evidence of such insurance as required under the Loan Agreement. (f) Damage, Destruction or Taking. In the event of any damage, destruction or Taking affecting all or any portion of the Property, Trustor shall give immediate written and oral notice thereof to Beneficiary and Trustee and proceed in accordance with the terms of the Loan Agreement. In case of any such material damage, destruction or Taking, Beneficiary shall be entitled to hold all insurance proceeds, payments or awards on account thereof, to the same extent Trustor would be entitled thereto under the Loan Agreement, and Trustor hereby irrevocably assigns to Beneficiary all of its rights to any such insurance proceeds, payments or awards. With respect to a Taking, and in accordance with its obligations under the Loan Agreement, Trustor will file or prosecute or will cause to be filed or prosecuted in good faith and with due diligence what would otherwise be its claim for any such award or payment and cause the same to be collected and paid over to Beneficiary. At the sole cost and expense of Trustor, Beneficiary may elect to monitor or participate in, and if reasonably necessary, may hire independent legal counsel to represent Beneficiary in connection with, any claim or the claims payment process. Trustor will pay or cause to be paid all costs and expenses reasonably incurred in connection with any Taking and the seeking and obtaining of any award or payment in respect thereof. Unless an Event of Default shall have occurred under the Loan Agreement, all sums so received by Beneficiary shall be applied in accordance with the provisions of the Loan Agreement. (g) Notification of Default, Etc. Promptly after obtaining knowledge thereof, notify Trustee and Beneficiary of any Default hereunder or under the Loan Agreement or of any action or proceeding materially and adversely affecting the Property. (h) Corporate Existence. Preserve and keep in full force and effect its corporate existence, rights and franchises and privileges as a corporation under the laws of the State of Texas and comply with all laws applicable to it, and do or cause to be done all things 7 9 necessary to preserve and to keep in full force and effect its right to own property in the State of Texas. (i) Inspection. Permit the Beneficiary or its authorized representatives to inspect the Property during usual business hours. ARTICLE IV 4. Negative Covenants. Without the prior written consent of Beneficiary, Trustor will not directly or indirectly create or permit to be created or to remain and will discharge or will cause to be discharged any mortgage, charge, lien or encumbrance on, or attachment or pledge of, or conditional sale or other title retention agreement with respect to, the Property or any part thereof, its interest or the interests of Trustee and Beneficiary therein, or the Rents or other sums payable pursuant to the Leases, except (i) this Indenture, (ii) the Permitted Encumbrances, (iii) easements, restrictions, liens, charges and other encumbrances permitted by the Loan Agreement, (iv) liens being contested in good faith and by appropriate proceedings in the manner permitted by the Loan Agreement, and (v) liens arising out of or created by any statute, the discharge of which cannot under the terms of such statute at the particular time be effected by Trustor; provided, however, that any such statutory liens will promptly be discharged as and when such discharge is possible or permissible. Trustor shall have the right to grant, without the prior consent of Beneficiary, any utility easement. ARTICLE V 5. Events of Default. If any one or more of the following events (individually, an "Event of Default") shall occur: (a) non-payment, when due, of any sums which Trustor is obligated to pay hereunder, under the Notes, or under the Loan Agreement continues unremedied for a period of five (5) days after the date such payment is due; or (b) failure of Trustor to keep in full force and effect its corporate existence, rights, franchises and privileges, except as provided for in the Loan Agreement; or (c) if an Event of Default (as defined in the Loan Agreement) shall have occurred under the Loan Agreement; or (d) if any of the representations or warranties made by Trustor in any document, instrument or certificate delivered in connection with the financing of the Property by Trustor proves to be untrue in any material respect; or 8 10 (e) if a default shall have occurred under any Other Indenture or under any other Loan Document and shall be continuing beyond the applicable grace or cure period provided therein; or (f) if Trustor shall (i) voluntarily be adjudicated a bankrupt or insolvent, (ii) seek or consent to the appointment of a receiver or trustee for itself or for any portion of the Property, (iii) file a petition seeking relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, (iv) make a general assignment for the benefit of creditors, or (v) be unable to pay its debts as they mature; or (g) a court shall enter an order, judgment or decree appointing, with the consent of Trustor, a receiver or trustee for it or for any of the Property or approving a petition filed against Trustor which seeks relief under the bankruptcy or other similar laws of the United States, any state or any jurisdiction, and such order, judgment or decree shall remain in force, undischarged or unstayed, sixty (60) days after it is entered; or (h) the estate or interest of Trustor in any of the Property shall be levied upon or attached in any proceeding and such estate or interest is about to be sold or transferred or such process shall not be vacated or discharged within fifteen (15) days after such levy or attachment; (i) if Trustor sells, conveys or transfers, voluntarily or otherwise, its interest in the Property without the prior written consent of Beneficiary; or (j) any material provision of the Loan Documents relating to Trustee's or Beneficiary's ability to realize on the Collateral following an Event of Default shall for any reason cease to be valid and binding on Trustor, or Trustor shall so state in writing. then, in any such event, Trustee or Beneficiary may accelerate the Indebtedness outstanding under this Indenture, and may take such other actions as may be provided under the Loan Agreement, or at law or in equity. ARTICLE VI 6.1. Assignment of Rents. As additional security hereunder, the Trustor hereby grants, bargains, conveys, assigns, transfers and sets over, and by these presents does grant, bargain, convey, assign, transfer and set over to the Beneficiary, as well as the Trustee on behalf of the Beneficiary, all Rents, if any,; provided, however, that unless and until an Event of Default occurs, the Trustor will have a license to collect and retain such Rents as and when, but not before, the same shall become due and payable. Upon an Event of Default, the Beneficiary shall be immediately entitled to and may collect such Rents. In addition, upon an Event of Default, the Beneficiary, or the Trustee on the Beneficiary's behalf, may at any time and without notice, either in person or by agent or by 9 11 receiver to be appointed by a court, enter and take possession of the Property or any part thereof, and in its own name, sue for or otherwise collect such Rents. The Trustor hereby agrees with the Beneficiary that other parties under the Leases may, upon notice from the Beneficiary, or the Trustee acting on behalf of the Beneficiary, on the occurrence of an Event of Default, thereafter pay directly to the Beneficiary the Rents due and to become due under the Leases and attorn to all other obligations thereunder, directly to the Beneficiary without any obligation on their part to determine whether an Event of Default does, in fact, exist or has, in fact, occurred. All Rents collected by the Trustee or the Beneficiary shall be applied as provided in Article XII hereof; provided, however, that if the costs and expenses and attorney's fees shall exceed the amount of the Rents collected, the excess shall be added to the Indebtedness, shall bear interest at the maximum rate allowable by law as provided herein, and shall be immediately due and payable. The entering upon and taking possession of the Property, the collection of Rents, if any, and the application thereof as aforesaid, shall not cure or waive any Event of Default or notice of default, if any, hereunder, nor invalidate any act done pursuant to such notice except to the extent that such default is fully cured. Failure or discontinuance of the Trustee or the Beneficiary at any time or from time to time, to collect said Rents, shall not in any manner impair the subsequent enforcement by the Beneficiary, or the Trustee on the Beneficiary's behalf, of the right, power and authority herein conferred upon it. Nothing contained herein, nor the exercise of any right, power or authority herein granted to the Beneficiary, or the Trustee on the Beneficiary's behalf, shall be construed to be an affirmation by it of any tenancy, lease or option, nor an assumption of liability under, nor the subordination of the lien or charge of this Indenture, to any such tenancy, lease or option. 6.2. Use of Furniture and Equipment. The Trustor agrees that, in the event the Beneficiary, or the Trustee on behalf of the Beneficiary, exercises its rights under Section 6.1, above, and takes possession of the Property through the assignment of Rents, or through a court-appointed receiver, the Trustor hereby waives any right to compensation for the use of the Trustor's furniture, fixtures and equipment, together with all accessories, replacements and substitutions therefor, in or about the Property for the use for the period such assignment of Rents or receivership is in effect. ARTICLE VII 7. Remedies in Case of Event of Default. 7.1. Legal Proceedings and Foreclosure. If an Event of Default shall have occurred and be continuing, the Trustee or the Beneficiary may proceed by suit or suits at law or in equity or by any other appropriate remedy to protect and enforce its rights hereunder, whether for the specific performance of any covenant or agreement contained herein, or for an injunction against the violation of any of the terms hereof, or in aid of the exercise of any right, power or remedy available to it, or to enforce the payment of the Indebtedness under the Loan Agreement, or to foreclose the lien and security interest of 10 12 this Indenture as against all or any part of the Property and to have all or any part of the Property sold, in any manner permitted by law, under the judgment or decree of a court or courts of competent jurisdiction, or otherwise, and to pursue any other remedies available to it. If the Beneficiary proceeds to foreclose the lien of this Indenture, the Beneficiary shall have the statutory power of sale if permitted by applicable law. All rights of action under this Indenture may, if permitted by applicable law, be enforced by the Trustee or the Beneficiary without the possession of the Notes and without the production of the Notes, the Loan Agreement or this Indenture at any trial or other proceeding relative thereto. In the event of any such suit or proceeding, the Beneficiary and/or the Trustee shall comply with any local laws applicable to any such suits or proceedings. Any such suit or proceeding instituted by the Trustee shall be brought in its name as Trustee and any recovery or judgment shall be for the benefit of the Beneficiary. All costs and expenses (including, without limitation, reasonable attorney's fees and expenses) incurred by the Trustee or the Beneficiary in connection with any such suit or proceeding, together with interest thereon (to the extent permitted by law) computed at the Default Rate from the date on which such costs or expenses are incurred to the date of payment thereof, shall constitute additional Indebtedness secured by this Indenture and shall be paid by the Trustor to the Trustee or the Beneficiary, as the case may be, on demand. 7.2. Power of Sale and Procedure. If an Event of Default shall have occurred and be continuing and after the Trustee or the Beneficiary shall have accelerated the Indebtedness as provided herein, the Trustee at the Beneficiary's election may sell or offer for sale the Property in such portions, order and parcels as the Beneficiary may determine, with or without having first taken possession of same, to the highest bidder for cash at public auction. Such sale shall be made in conformance with the laws of the State of Texas at the courthouse door of the county wherein the Property is situated on the first Tuesday of any month between the hours of 10:00 A.M. and 4:00 P.M. after giving adequate legal notice of the time, place and terms of sale and that portion of the Property to be sold, by (i) posting or causing to be posted written or printed notices thereof for at least twenty-one (21) consecutive days prior to the date of said sale at the respective county courthouse door, and at least twenty-one (21) days preceding the date of said sale: (x) filing a copy of such notice with the Clerk of the County in which the Property is located, and (y) serving written notice (by the Beneficiary or any person chosen by it) of such proposed sale by certified mail on each debtor obligated to pay the Indebtedness under the Loan Agreement, service of such notice to any debtor to be completed upon deposit of the notice, enclosed in a post-paid wrapper appropriately addressed to each debtor at the most recent address as shown by the records of the Beneficiary, in a post office or official depository under the care and custody of the United States Postal Service (it being expressly understood that the affidavit of any person having knowledge of the facts to the effect that such service was completed shall be prima facie evidence of the fact of such service), or (ii) by accomplishing all or any of the aforesaid in such manner as permitted or required by Texas law in existence on the date hereof relating to the sale of real estate under a power of sale and/or relating to the sale of collateral under a power of sale after 11 13 default by a debtor, or by any subsequent laws relating to same. At any such sale (i) whether made under the power herein contained, Texas law, any other legal requirement or by virtue of any judicial proceeding or any other legal right, remedy or recourse, it shall not be necessary for the Trustee to have physically present, or to have constructive possession of, the Property (the Trustor hereby covenanting and agreeing to deliver to the Trustee any portion of the Property not actually or constructively possessed by the Trustee immediately upon demand by the Trustee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to such purchaser at such sale, (ii) each instrument of conveyance executed by the Trustee shall contain a special warranty of title, binding upon the Trustor, (iii) each and every recital contained in any instrument of conveyance made by the Trustee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment of the indebtedness, advertisement and conduct of such sale in the manner provided herein and otherwise by law and appointment of any successor Trustee hereunder, (iv) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed, and (v) the receipt of the Trustee or of such other party or officer making the sale shall be a sufficient discharge to the purchaser or purchasers for his or their purchase money and no such purchaser or purchasers, or his or their assigns or personal representatives, shall thereafter be obligated to see to the application of such purchase money or be in any way answerable for any loss, misapplication or non-application thereof. 7.3. Acceleration of Maturity. If an Event of Default shall have occurred, the Beneficiary may declare the entire outstanding Indebtedness under the Loan Agreement, and all other sums secured hereby, to be due and payable immediately, and upon such declaration such Indebtedness and other sums shall immediately become and be due and payable without demand or notice. 7.4. Leases. The failure to make any tenants of the Property parties defendant to any such foreclosure proceedings and to foreclose their rights will not be, nor be asserted by the Trustor to be, a defense to any proceedings instituted by the Trustee and/or the Beneficiary to collect the sums secured hereby or to collect any deficiency remaining unpaid after the foreclosure sale of the Property. 7.5. Suits to Protect the Property. The Beneficiary, or the Trustee at the Beneficiary's election, shall have the power and authority to institute and maintain any suits and proceedings as the Beneficiary may deem advisable (a) to prevent any impairment of the Property by any acts which may be unlawful or any violation of this Indenture, (b) to preserve or protect its interest in the Property, and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement of or compliance with such enactment, rule or order might impair the security hereunder or be prejudicial to the Beneficiary's interest. 12 14 7.6. Discontinuance of Proceedings; Position of Parties Restored. If the Beneficiary, or the Trustee at the Beneficiary's election, shall have proceeded to enforce any right or remedy under this Indenture by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Beneficiary, then and in every such case, to the extent permitted by and consistent with applicable law, the Trustor and the Beneficiary shall be restored to their former positions and rights hereunder, and all rights, powers and remedies of the Beneficiary shall continue as if no such proceeding had occurred or had been taken. 7.7. The Trustor to Pay the Indebtedness on Any Default in Payment; Application of Monies by the Beneficiary. (a) If an Event of Default shall occur as a result of Trustor's failure to pay any amount due under the Loan Agreement or this Indenture, or any other instrument securing the Notes, then, upon the Beneficiary's demand, the Trustor will pay to the Beneficiary the whole amount due and payable under the Loan Agreement and all other sums secured hereby; and if the Trustor shall fail to pay the same forthwith upon such demand, the Beneficiary, or the Trustee at the Beneficiary's election, shall be entitled to sue for and to recover judgment for the whole amount so due and unpaid together with costs and expenses, including the reasonable compensation, expenses and disbursements of the Beneficiary's agents, attorneys and other representatives. The Beneficiary shall be entitled to sue and recover judgment as aforesaid either before, after or during the pendency of any proceedings for the enforcement of this Indenture, and the right of the Beneficiary to recover such judgment shall not be affected by any taking, possession or foreclosure sale hereunder, or by the exercise of any other right, power or remedy for the enforcement of the terms of this Indenture, or the foreclosure of the lien hereof. (b) In case of a foreclosure sale of all or any part of the Property and of the application of the proceeds of sale to the payment of the sums secured hereby, the Beneficiary shall be entitled to enforce payment of and to receive all amounts then remaining due and unpaid and to recover judgment for any portion thereof remaining unpaid, with interest. (c) The Trustor hereby agrees, to the extent permitted by law, that no recovery of any such judgment by the Beneficiary and no attachment or levy of any execution upon any of the Property or any other property shall in any way affect the lien of this Indenture upon the Property or any part thereof or any lien, rights, powers or remedies of the Beneficiary hereunder, but such lien, rights, powers and remedies of the Beneficiary hereunder shall continue unimpaired as before. 7.8. Remedies Cumulative. No remedy herein shall be exclusive of any other remedy or remedies, and each such remedy shall be cumulative and in addition to every other remedy given hereunder or now or hereafter existing at law or in equity; and every 13 15 power and remedy of the Trustee or the Beneficiary hereunder may be exercised from time to time and as often as may be deemed expedient by the Trustee or the Beneficiary. No delay or omission of the Trustee or the Beneficiary to exercise any right or power accruing upon an Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein. ARTICLE VIII 8.1. Purchase of the Property by Beneficiary. Beneficiary may be a purchaser of the Property or any part thereof or any interest therein at any sale thereof, whether pursuant to foreclosure, power of sale or otherwise, and may apply the Indebtedness secured hereby to the purchase price. 8.2. Title Upon Sale; Receipt a Sufficient Discharge to Purchaser. After the occurrence of an Event of Default hereunder, and upon the sale of the Property or any part thereof or any interest therein by Trustee or Beneficiary, whether pursuant to foreclosure, power of sale or otherwise, the purchaser shall acquire good title thereto, free of the lien of this Indenture and free of all rights of redemption, whether statutory, equitable or otherwise, in Trustor to the extent permitted by applicable law. The receipt of the officer making the sale under judicial proceedings or of Trustee or Beneficiary shall be sufficient discharge to the purchaser for the purchase money, and such purchaser shall not be obligated to see to the application thereof. All occupants of the Property sold or any part thereof shall become tenants at sufferance of the purchaser, and as long as a tenant is not in default under its Lease, the purchaser will not disturb the occupancy of such tenant of the Property during the term of its Lease. It shall not be necessary for the purchaser at any such sale to bring any action for possession to the Property purchased other than statutory action of forcible detainer in any justice court having jurisdiction. 8.3. Application of Indebtedness Toward Purchase Price. If Beneficiary purchases the Property pursuant to foreclosure, power of sale or otherwise, then Beneficiary may, in lieu of cash, apply all or any portion of the sums due to Beneficiary under the Loan Agreement and this Indenture or any other instrument securing the Indebtedness, to the unpaid balance of the purchase price remaining after payment of any portion of the purchase price required to be paid in cash, and the costs and expenses of the sale, compensation and other charges relating to the sale. ARTICLE IX 9. Waiver of Appraisement, Valuation, Etc. Trustor hereby waives, to the full extent it may lawfully do so, the benefit of all appraisement, valuation, stay, moratorium, exemption from execution, extension and redemption laws now or hereafter in force and all rights of marshaling in the event of the sale of the Property or any part thereof or any interest therein. 14 16 ARTICLE X 10. Appointment of Receiver. If an Event of Default shall have occurred, Trustee and/or Beneficiary shall, as a matter of right and to the fullest extent permitted by applicable law, be entitled, ex parte and without notice, to the appointment of a receiver or receivers of the Property or any part thereof, whether such receivership be incidental to a proposed sale thereof or otherwise, and Trustor hereby consents to the appointment of such a receiver or receivers and will not oppose any such appointment. The expenses, including receiver's fees, attorney's fees, costs and agent's compensation, incurred pursuant to the powers herein contained shall be secured by this Indenture. ARTICLE XI 11. Possession, Management and Income. If an Event of Default shall have occurred under this Indenture, Trustee or Beneficiary, without further notice, may enter upon and take possession of the Property or any part thereof, in any manner permitted by law, by reasonable force, summary proceedings, ejectment or otherwise and may remove Trustor and all other Persons and any and all property therefrom, and Trustee or Beneficiary may hold, operate and manage the same, make all necessary or proper repairs, renewals, and replacements, and useful alterations, additions, betterments and improvements thereto and thereon as may seem advisable to either of them, and insure and reinsure the Property as may seem advisable and to either of them, and may receive all earnings, income, rents, issues and proceeds accruing with respect thereto. Any amounts so received by Trustee or Beneficiary shall be applied (a) to pay (i) the expenses of operating the Property and of all maintenance, repairs, renewals, replacements, alterations, additions, betterments, improvements, taxes, assessments, insurance premiums, reasonable compensation for the services of Trustee and all attorneys, advisors, brokers, receivers, agents and other employees engaged or employed by Trustee or Beneficiary and all other costs and expenses of entering a bond and taking possession of and holding the Property, and (ii) any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge and then (b) in the manner provided in Article XII of this Indenture. If an Event of Default shall have occurred under the Loan Agreement or if the Loan Agreement shall be terminated, all sums so received by Trustee or Beneficiary shall be applied in the manner specified in Article XII of this Indenture. ARTICLE XII 12. Application of Proceeds. The proceeds of (a) the operation and management of the Property pursuant to Article XI of this Indenture, and (b) any sale of the Property or any interest therein, shall, unless otherwise provided in the Loan Agreement, be applied as follows: 15 17 First: to the costs and expenses of the sale, reasonable attorneys' fees and expenses, Trustee's fees and expenses, court costs, and any other expenses or advances made or incurred in the protection of the rights of Trustee and Beneficiary or in the pursuance of any remedies hereunder; Second: to the fullest extent permitted by applicable law, to any lien prior to the lien of this Indenture which Beneficiary may consider it necessary or desirable to discharge; Third: to any Indebtedness secured by this Indenture and at the time due and payable (whether by acceleration or otherwise; Fourth: to Beneficiary for payment of the Notes outstanding; and Fifth: the balance, if any, to Trustor. ARTICLE XIII 13. Remedies, Etc., Cumulative. Each legal, equitable or contractual right, power or remedy of Trustee and Beneficiary now or hereafter provided herein or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy, and the exercise or beginning of the exercise by Trustee or Beneficiary of any one or more of such rights, powers and remedies shall not preclude the simultaneous or later exercise of any or all such other rights, powers and remedies. ARTICLE XIV 14. No Waiver, Etc. No failure by Trustee or Beneficiary to insist upon the strict performance of any term hereof or to exercise any right, power or remedy consequent upon a breach hereof shall constitute a waiver of any such term or of any such breach. No acceptance of the payment of any sums due under this Indenture or under the Loan Agreement during the continuance of any Default shall constitute a waiver thereof. No waiver of any breach shall affect or alter this Indenture which shall continue in full force and effect with respect to any other then existing or subsequent breach. ARTICLE XIV 15. Trustee. (a) All the rights, powers and remedies of Beneficiary hereunder may be exercised by Trustee. Trustee shall not be under any obligation to exercise any trust or power vested in him by this Indenture unless Beneficiary shall have offered Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred by Trustee in compliance herewith. Trustee shall not be liable with respect to any 16 18 action taken or omitted to be taken by Trustee in accordance with the written directions of Beneficiary, except for Trustee's own bad faith, willful misconduct or negligence. Trustee shall not be required to ascertain or inquire as to the performance or observance of any of the covenants or agreements of Trustor herein, and in the absence of written notice from Trustor or Beneficiary stating that a Default has occurred and specifying the same, Trustee may conclusively assume that no Default exists. (b) Trustee may, with consent of Beneficiary, consult with counsel (which may be counsel for Trustor) and the written advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by him hereunder in good faith and in accordance therewith. (c) Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys. (d) Any moneys received by Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law. (e) Beneficiary may, by instrument in writing, filed in the office or offices where this Indenture has been recorded, and at any time or from time to time, and without notice and without specifying any reason therefor, and without applying to any court, remove Trustee and select a successor trustee or trustees in the event of the death, removal, resignation, refusal to act, or inability to act of Trustee or, in its sole discretion, for any reason whatsoever. Trustee so ceasing to act shall duly assign, transfer and deliver any of the property and monies held by such Trustee to the successor appointed in Trustee's place. All powers, rights and duties and authority of Trustee shall thereupon become vested in the successor. The successor shall not be required to give bond or make an oath for the faithful performance of his duties unless required by Beneficiary. (f) Trustee may resign by the giving of notice of such resignation in writing to Beneficiary. (g) If more than one Trustee is appointed under this Indenture, all rights granted to and all powers conferred upon Trustee hereunder may be exercised by both or either of Trustees. (h) All reasonable expenses, charges, counsel fees and other disbursements incurred by Trustee in and about the administration of this Indenture and executed in the performance of its duties and powers hereunder shall be secured by this Indenture. 17 19 ARTICLE XVI 16. Right of Trustee or Beneficiary to Perform Covenants, Etc. If Trustor shall fail to make any payment or perform any act required to be made or performed hereunder and such failure shall not be cured within the applicable grace period, if any, Trustee or Beneficiary, without notice to or demand upon Trustor and without waiving or releasing any obligation or Default, may (but shall be under no obligation to) at any time thereafter make such payment or perform such act for the account and at the expense of Trustor and may enter upon the Property or any part thereof for such purpose and take all such action thereon as, in the opinion of Trustee or Beneficiary, may be necessary or appropriate therefor. All sums so paid by Trustee or Beneficiary and all costs and expenses (including, without limitation, attorneys' fees and expenses) so incurred shall constitute additional Indebtedness secured by this Indenture and shall be paid by Trustor to Trustee or Beneficiary on demand. ARTICLE XVII 17. Sale a Bar Against the Trustor. The sale of the Property or any part thereof or any interest therein, whether pursuant to foreclosure, power of sale or otherwise under this Indenture, shall forever bar any claim with respect thereto by the Trustor to the extent permitted by applicable law. ARTICLE XVIII 18. Authorization to Execute Instruments, Etc. The Trustor irrevocably appoints the Beneficiary as its true and lawful attorney, which appointment is coupled with an interest and is irrevocable, in the Trustor's name and stead and on its behalf, for the purpose of (a) executing on behalf of the Trustor and filing continuation statements and any necessary amendments to all financing statements naming the Trustee and/or the Beneficiary as the secured parties filed under any applicable Uniform Commercial Code, and (b) effectuating any sale, assignment, transfer or delivery of the Property or any part thereof or any interest therein for the enforcement of this Indenture whether pursuant to foreclosure, power of sale or otherwise, or in the event of any purchase of the Property by the Lessee pursuant to the Lease, to execute and deliver all such deeds, bills of sale, assignments, releases and other instruments as the Trustee or the Beneficiary may consider necessary or appropriate, with full power of substitution, the Trustor hereby ratifying and confirming all that such attorney or any substitute shall lawfully do by virtue hereof. If so requested by the Trustee or the Beneficiary, the Trustor shall ratify and confirm any such sale, assignment, transfer or delivery by executing and delivering to the Trustee or the Beneficiary all proper deeds, bills of sale, assignments, releases and other instruments as may be designated in any such request. 18 20 ARTICLE XIX 19. Certificate as to No Default, Etc.; Information. At any time and from time to time, Trustor will deliver to Beneficiary, promptly upon request, a certificate signed by a duly authorized officer of Trustor stating that, to the best of the signer's knowledge after making due inquiry, there is no Default hereunder, or if any such Default exists to his knowledge, specifying the nature and period of existence thereof and what action Trustor is taking or proposes to take with respect thereto. Trustor will also furnish promptly to Beneficiary, such information with respect to the Property and the Leases as may from time to time be requested. ARTICLE XX 20. Additional Instruments. Trustor, at its expense, will execute, acknowledge, secure and deliver all such instruments and take all such action as Trustee or Beneficiary from time to time may reasonably request for the better assuring of the Property, rights and obligations now or hereafter subjected to the security of this Indenture or intended so to be. ARTICLE XXI 21. Defeasance. This Indenture and the lien created hereby shall terminate after the payment in full of (a) all the Indebtedness and (b) all other sums secured hereby. Upon such termination, and upon surrender of this Indenture for cancellation, Beneficiary shall release, without warranty, the Property then subject to the lien hereof to the Persons entitled thereto. The recitals in any release executed under this Indenture of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such release may be described as "the person or persons legally entitled thereto". Trustee and/or Beneficiary, at Trustor's expense, shall execute and deliver such instruments of release, satisfaction and termination in proper form for recording or filing, as may be appropriate to evidence the release of (a) the Property from the lien created hereby, and (b) any other security held by Trustee and/or Beneficiary and such satisfaction and termination, and such instruments, when duly executed, recorded and filed, shall conclusively evidence the release, satisfaction and termination of this Indenture. ARTICLE XXII 22. Applicable Law; Severability. (a) This Indenture shall be governed by and construed in accordance with the laws of the State. (b) All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and are intended to be limited to the extent necessary so that they will not render this Indenture invalid, 19 21 unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term or provision of this Indenture shall be held to be invalid, illegal or unenforceable, the validity of the other terms and provisions hereof shall in no way be affected thereby. ARTICLE XXIII 23. Notices. All notices, demands, requests for consents, consents and other communications required or permitted hereunder shall be in writing (including facsimile transmission) and shall be given to such party, addressed to it, at its address or telephone number set forth in the preamble, or at such other address or telephone number as such party may hereafter specify for the purpose of notice to the other party. Each such notice, request or communication shall be effective when delivery is received at the address specified in the preamble. ARTICLE XXIV 24. Miscellaneous. This Indenture (a) may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought, and (b) shall be binding upon Trustor, its successors and assigns, and all Persons claiming under or through Trustor or any such successor or assign, and shall inure to the benefit of and be enforceable by Trustee and its successors and Beneficiary and its successors and assigns. The headings in this Indenture are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All agreements between Trustor and Beneficiary, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of demand or acceleration of the maturity of any payments hereunder or under the Loan Agreement or otherwise, shall the interest contracted for, charged, received, paid or agreed to be paid to Beneficiary exceed the maximum amount permissible under applicable law. If, in any circumstance whatsoever, interest would otherwise be payable to Beneficiary in excess of the maximum lawful amount, and if in any circumstance Beneficiary shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, and if permitted by applicable law, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Trustor. All interest paid or agreed to be paid to Beneficiary shall, to the extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout the full period until payment in full of the principal so that the interest hereon for such full period shall not exceed the maximum amount permitted by applicable law. This paragraph shall control all agreements between Trustor and Beneficiary. This Indenture may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. Portions of the Property consist of goods which are, or are to become, fixtures relating to the Land and Trustor expressly covenants 20 22 and agrees that the filing of this Indenture in the real estate records of the county where the Property is located shall also operate from the time of filing therein as a financing statement filed as a fixture filing in accordance with Article 9 of the State's Uniform Commercial Code - Secured Transactions. ARTICLE XXV 25. Change in Method of Taxation. In the event of the passage, after the date of this Indenture, of any law changing in any way the laws now in force for the taxation of mortgages or debts secured thereby, for state or local purposes, or the operation of any such taxes so as to adversely affect the interest of Beneficiary in the Property, this Indenture or the Loan Agreement, Trustor shall, upon demand, bear and pay the full amount (or any partial amount) requested by Beneficiary, of taxes resulting from such changes hereunder without offset or credit against any other sums due under the Loan Agreement or on the Notes. ARTICLE XXVI 26. Trustee's Acceptance. Trustee accepts the trust created hereby when this Indenture, duly executed and acknowledged, is made a public record in the State and county where the Property is located, as provided by the laws of Texas. ARTICLE XXVII 27. No Petition. Trustee and Beneficiary hereby covenant and agree that they will not institute against, or join any Person in instituting against Trustor, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law at any time other than on a date which is at least one (1) year and one (1) day after the payment in full of the Notes; provided, however, that nothing in this Article shall constitute a waiver of any right to indemnification, reimbursement or other payment from Trustor pursuant to the Loan Agreement. ARTICLE XXVIII 28. Indenture Secures Future Advances. This Indenture is given to secure not only the amount initially secured by this Indenture, but also such future advances, whether such advances are obligatory or are to be made at the option of Trustee or Beneficiary, or otherwise, as are made within twenty (20) years from the date hereof, to the same extent as if such future advances were made on the date of the execution of this Indenture. The total amount of Indebtedness presently secured hereby is One Hundred Fifty Million Dollars ($150,000,000.00) and the Indebtedness (including present and future obligations) that may be so secured may decrease or increase from time to time, but the total unpaid 21 23 balance so secured at one time shall not exceed four times the face amount of the amount initially secured by this Indenture plus interest thereon. This Indenture secures a revolving line of credit under which Advances may be made, repaid, and reborrowed on a revolving basis as provided for in the Loan Agreement. ARTICLE XXIX 29. Approval of Legal Description. Trustor has read and does hereby approve the legal description of the Land which is the subject hereof, as set forth in Exhibit A attached hereto, and hereby indemnifies Trustee and Beneficiary and their attorneys with respect to any liability which might arise as a consequence of any error or omission therein. ARTICLE XXX 30. Loan Agreement. The terms, provisions, conditions, representations and warranties and covenant of the Loan Agreement are incorporated herein by reference. In the event of a conflict between this Indenture and the Loan Agreement, the Loan Agreement shall control. The Loan Agreement contains provisions permitting Trustor to obtain releases of portions of the Property from this Indenture from time to time. ARTICLE XXXI 31. WAIVER OF JURY TRIAL. TRUSTOR, TRUSTEE AND BENEFICIARY, BY ITS ACCEPTANCE HEREOF, EACH ACKNOWLEDGE AND AGREE THAT NEITHER TRUSTOR, TRUSTEE NOR BENEFICIARY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR LEGAL REPRESENTATIVE OF ANY OF THE SAME, WILL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF THIS DEED OF TRUST, THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, ANY COLLATERAL, OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG TRUSTOR, TRUSTEE OR BENEFICIARY, RELATED THERETO. NONE OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY AND AMONG TRUSTOR, TRUSTEE AND BENEFICIARY, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR TRUSTEE AND THE LENDERS TO MAKE THE LOAN TO TRUSTOR, AND WILL BE SUBJECT TO NO EXCEPTIONS. IN WITNESS WHEREOF, Trustor has caused this Indenture to be executed and attested by its proper officers thereunto duly authorized, as of the day and year first above written and has executed the same in order that this Indenture may qualify as a financing statement under the Uniform Commercial Code of the State as to such of the Property, if any, constitutes personalty. KOGER EQUITY, INC., a Florida corporation By: /s/ G. Danny Edwards ------------------------------- Name: G. Danny Edwards ------------------------------- Title: Treasurer ----------------------------- 22 24 STATE OF Georgia ss. ss. COUNTY OF Camden ss. This instrument was acknowledged before me on the 30th day of December, 1998, by G. Danny Edwards the Treasurer of KOGER EQUITY, INC., a Florida corporation, on behalf of said corporation. /s/ Dee Price ------------------------------- Notary Public My commission expires:Feb. 1, 1999 Notary Public, Camden County, Georgia 23 25 EXHIBIT A The Land 26 EXHIBIT B Permitted Encumbrances EX-10.(K)(7)(B) 30 ASSIGNMENT OF LEASES AND RENTS 1 THIS INSTRUMENT PREPARED BY EXHIBIT 10(k)(7)(b) AND RECORD AND RETURN TO: Alan C. Sheppard, Jr., Esq. LeBoeuf, Lamb, Greene & MacRae, L.L.P. 50 North Laura Street, Suite 2800 Jacksonville, FL 32202-3650 ASSIGNMENT OF LEASES AND RENTS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ASSIGNMENT OF LEASES AND RENTS THIS ASSIGNMENT OF LEASES AND RENTS (this "Assignment") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Assignor"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Assignee") for the Lenders under and as defined in that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 (the "Loan Agreement"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. Capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Agreement. R E C I T A L S: A. Assignor is the trustor under that certain Deed of Trust, Assignment of Leases and Rents and Security Agreement given by Assignor to Assignee dated of even date herewith and recorded or to be recorded in the real property records of Bexar County, Texas (the "Deed of Trust"); securing the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Assignor payable to the order of Compass in the original principal amount of $15,000,000 (collectively, the "Notes"), encumbering certain real property interests located in Bexar County, Texas, as more particularly described on attached Exhibit A (the "Premises"). 1 3 B. To further secure the payment, discharge and performance of the Notes, and as a condition to Assignee's extension of credit to Assignor pursuant to the Notes, Assignor has agreed to execute this Assignment for the purposes set forth herein. NOW, THEREFORE, to further secure the payment, discharge and performance of the indebtedness of Assignor to Assignee evidenced by the Notes and in consideration of Assignee's acceptance of the Notes and in further consideration of the sum of Ten Dollars ($10.00) paid by Assignee to Assignor, receipt and sufficiency of which are hereby acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title and interest in, to and under any and all present and future leases of or in the Premises ("Leases") and any and all rents, revenues, issues and profits (including Assignor's interest in any security deposits relating thereto) arising out of or accruing from the Leases whether now or hereafter due ("Rents"), said Leases and Rents being deemed part of the security for the indebtedness herein mentioned and are encumbered, transferred and conveyed by this Assignment, and in furtherance thereof, does hereby covenant and agree with Assignee as follows: 1. Assignor will notify Assignee in writing (but without any right of approval or denial on the part of Assignee) of any termination, substitution or material modification of any Leases involving 10,000 or more Koger Net Square Feet (as defined in the Loan Agreement). 2. Assignor will, at its cost and expense, observe, perform and discharge, or cause to be observed, performed and discharged, all of the obligations and undertakings of Assignor or its agents under the Leases, and will use its reasonable best efforts in the exercise of sound business judgment to enforce or secure, or cause to be enforced or secured, the performance of each and every obligation and undertaking of the respective tenants under the Leases, and will appear in and defend, at its cost and expense, any action or proceeding arising under or in any manner connected with the Leases or the obligations and undertakings of any tenant thereunder. Assignor will not do or permit to be done anything to impair the security hereof, including without limitation the execution of any other assignment of Assignor's interest in the Leases or the Rents, without Assignee's prior written consent. 3. This Assignment is intended to operate as an absolute and immediate assignment of the Leases and the Rents; however, unless and until a an Event of Default occurs under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignor will have a license to collect the Rents as and when the same become due and payable. Assignor hereby agrees that the respective tenants under the Leases, upon notice from Assignee of the occurrence of an Event of Default hereunder, will thereafter pay to Assignee the Rents due and to become due under the Leases without any obligation to determine whether or not such an Event of Default does in fact exist. Assignor, without written approval of Assignee, will not collect or accept Rent for more than one (1) month in advance; provided, however, Assignor may accept Rent two (2) months in advance if such Rent accepted two (2) months 2 4 in advance does not exceed five percent (5%) of the Rent collected during the applicable month. 4. Upon payment in full of the principal sum and interest, of the Notes, this Assignment shall become and be void and of no effect. Assignor hereby authorizes and directs the lessees named in said Leases or any other or future lessees or occupants of the Premises described therein or in the Deed of Trust upon receipt from the Assignee of written notice to the effect that Assignee is then the holder of the Notes and the Deed of Trust and that an Event of Default exists thereunder or under the Assignment, to pay over to the Assignee all rents, income, profits and revenues hereby assigned and to continue so to do until otherwise notified by Assignee. 5. This Assignment of Leases and Rents as provided herein will not be deemed or construed to constitute Assignee as a mortgagee in possession of the Premises nor to obligate Assignee to take any action or to incur expenses or perform or discharge any obligation, duty or liability of Assignor under any Lease, or for the control, care, management, or repair of the Premises; nor will it operate to make Assignee, except in the event of Assignee's negligence, recklessness or willful misconduct, responsible or liable for any waste committed on the Premises by the tenants or any other parties or for any dangerous or defective condition of the Premises, or for any act or omission relating to the management, upkeep, repair, or control of the Premises that results in loss or injury or death to any person. Except in the event of Assignee's negligence, recklessness or willful misconduct, Assignee will not be liable for any loss sustained by Assignor resulting from Assignee's failure to lease the Premises after default or from any other act or omission of Assignee in managing the Premises after default. Assignor will and does hereby indemnify and agree to hold harmless Assignee from and against any and all liability, loss, cost, damage or expense which may be incurred under the Leases or by reason of this Assignment of Leases (except as a result of Assignee's gross negligence or willful misconduct) and, to the extent that a claim is made against Assignee prior to the time Assignee takes possession of the Premises, from any and all claims and demands whatsoever which may be asserted against Assignee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in the Leases. Should Assignee incur any such liability under the Leases or by reason of this Assignment of Leases and Rents or in defense of any such claims or demands, the amount thereof, including costs, expenses, and reasonable attorneys' and paralegals' fees and costs, will be secured hereby and Assignor will reimburse Assignee therefor immediately upon demand and upon the failure of Assignor so to do, Assignee may, at its option, declare all sums secured hereby immediately due and payable, or may charge the costs thereof to Assignor as an advance under the Notes and secured by this Assignment. 6. To the extent not so provided by applicable law, each Lease will provide that, in the event of enforcement by Assignee of the remedies provided for by law or by the Notes, the Deed of Trust or this Assignment, the lessee thereunder will, upon request of any person succeeding to the interest of Assignor as a result of such enforcement, 3 5 automatically become the lessee of said successor in interest, without change in the terms or other provisions of such Lease. Any such successor in interest will not be bound by any payment of rent or additional rent made more than one (1) month or two (2) months in advance (as applicable in accordance with Paragraph 3 above). The Leases are and at all times shall be subject and subordinate in all respects to the Deed of Trust, and to all renewals, modifications, amendments, consolidations, replacements, refinancings and extensions of the Deed of Trust, to the full extent of all principal, interest and all other amounts secured thereby. Provided that a tenant is not in default under its Lease, Assignee shall not disturb the occupancy of such tenant under its Lease during the term of such Lease, notwithstanding foreclosure of the Deed of Trust, acceptance of a deed in lieu of foreclosure or exercise of any other remedy provided in the Deed of Trust, or pursuant to the laws of the State of Texas. If requested by a tenant or Assignor under any of the Leases or upon Assignee's request, Assignor and Assignee shall enter into a subordination, nondisturbance and attornment agreement (reasonably acceptable in form and substance to Assignee) with such tenant whereby Assignee will agree to not disturb the tenant in its possession of the Premises provided such tenant is not in default under its Lease and the tenant will agree to attorn to Assignee if Assignee takes possession of the Premises. 7. Upon a default under the Notes, the Loan Agreement, the Deed of Trust or this Assignment, Assignee may at its option, without notice and without regard to the adequacy of the security for the obligations set forth in the Notes, either in person, by court appointed receiver or by agent, with or without bringing any action or proceeding, demand and thereupon take possession of the Premises, to have, hold, manage, lease and operate the same on such terms and for such period of time as Assignee may deem proper, and either with or without taking possession of the Premises in its own name, demand and receive the Rents in the possession of Assignor at the time of Assignee's written demand or collected thereafter, including those past due and unpaid, with full power to make from time to time all alterations, renovations, repairs, or replacements thereto or thereof as may seem proper to Assignee, and to apply such Rents to the payment of: (a) all reasonable expenses of managing the Premises, including, without limitation, the salaries, fees and wages of the managing agent and such other employees as Assignee may deem necessary or desirable, all taxes, charges, claims, assessments, liens, premiums for all insurance which Assignee may deem necessary or desirable, costs of renovations, repairs, or replacements, and all expenses incident to taking and retaining possession of the Premises and protecting and preserving the same; or (b) the principal sum and interest thereon of the Notes, together with all costs and attorneys' and paralegals' fees and costs; all in such order or priority as Assignee in its sole discretion may determine, any custom or use to the contrary notwithstanding. 8. This Assignment is made and accepted without prejudice to any of the rights and remedies possessed by Assignee under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust, and the right of Assignee to exercise its remedies under this Assignment may be exercised by Assignee either prior to, simultaneously with, or subsequent to any action taken by it under the remaining terms and 4 6 conditions of the Notes, the Loan Agreement, or the Deed of Trust. Each and every right, remedy and power granted to Assignee by this Assignment will be cumulative and in addition to any other right, remedy and power given by the remaining terms and conditions of the Notes, the Loan Agreement, the Deed of Trust or this Assignment, or now or hereafter existing in equity, at law or by virtue of statute or otherwise. Nothing contained in this Assignment, and no act done or omitted by Assignee pursuant to the powers and rights granted it hereunder, nor the failure of Assignee to avail itself of any of the rights and remedies under this Assignment, will be construed or deemed to be a waiver of any of Assignee's rights and remedies under this Assignment, nor will such exercise or omission to exercise of the powers and rights granted Assignee hereunder be deemed to constitute a waiver of its rights and remedies under the remaining terms and conditions of the Notes, the Loan Agreement, or the Deed of Trust. 9. Assignee may take or release other security for the payment of the indebtedness under the Notes and the Deed of Trust, may release any party primarily or secondarily liable therefor, and may apply any other security held by it to the satisfaction of such indebtedness without prejudice to any of its rights under this Assignment. 10. The term "Lease" or "Leases" as used herein, means said Leases hereby assigned or any extension or renewal thereof, and any leases subsequently executed during the term of this Assignment covering the Premises or any part thereof. At Assignee's request, Assignor will assign and transfer to Assignee any and all subsequent leases upon all or any part of the Premises and to execute and deliver at the request of Assignee all such further assurances and assignments in the Premises as Assignee will require from time to time in its sole discretion. 11. This Assignment, together with the covenants and warranties therein contained, shall inure to the benefit of Assignee and any subsequent holder of the Notes and the Deed of Trust shall be binding upon Assignor, their successors, executors, personal representatives, and assigns, and any subsequent owner of the Premises. 12. This Assignment shall expire and terminate upon the payment in full of the Notes and any other Indebtedness secured by the Deed of Trust and any cancellation, satisfaction or release of the Deed of Trust shall constitute a cancellation, satisfaction, or release of this Assignment. In the event that a specific property is released from the lien of the Deed of Trust, then such property and the Leases relating to it shall, effective with the release, also be released from this Assignment. 13. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR, THE ASSIGNEE, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THE ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP 5 7 BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO ASSIGNOR, AND SHALL BE SUBJECT TO NO EXCEPTIONS. 6 8 IN WITNESS WHEREOF, Assignor has executed this Assignment under seal the day and year first above written. ASSIGNOR: KOGER EQUITY, INC., a Florida corporation By: /s/ G. Danny Edwards --------------------------------- Name: G. Danny Edwards ------------------------------- Title: Treasurer ------------------------------ STATE OF Georgia ss. ss. COUNTY OF Camden ss. This instrument was acknowledged before me on the 30th day of December, 1998, by G. Danny Edwards, the Treasurer of KOGER EQUITY, INC., a Florida corporation, on behalf of said corporation. /s/ Dee Price ------------------------------------ Notary Public My commission expires: Feb. 1, 1999 Notary Public, Camden County, Georgia 7 9 EXHIBIT A LEGAL DESCRIPTION OF PREMISES 8 EX-10.(K)(7)(C) 31 ENVIRONMENTAL INDEMNIFICATION AGREEMENT 1 EXHIBIT 10(k)(7)(c) ENVIRONMENTAL INDEMNIFICATION AGREEMENT FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 ENVIRONMENTAL INDEMNIFICATION AGREEMENT THIS ENVIRONMENTAL INDEMNIFICATION AGREEMENT (this "Agreement") is made and executed as of this 30th day of December, 1998, from KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("FUNB"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined) (FUNB and such Lenders are collectively referred to herein as the "Lenders"), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group, which terms Borrower and Lenders, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. R E C I T A L S : A. Borrower has obtained financing from Lenders pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan Agreement") and those certain Substitution Revolving Promissory Notes and Revolving Promissory Notes dated as of even date herewith (hereinafter, together with any and all extensions, renewals, modifications, replacements and substitutions thereof, referred to as the "Loan"). B. Borrower's obligations under the Loan are secured in part by a Deed of Trust, Assignment of Leases and Rents and Security Agreement in favor of Lenders (the "Deed of Trust") encumbering real property located in Bexar County, Texas, and being more particularly described on attached Exhibit A (the "Property"). C. As a condition precedent to and as a material inducement for Lenders' agreement to provide the Loan to Borrower, Lenders have required Borrower to execute and deliver this Agreement, it being acknowledged and understood by Borrower that Lenders otherwise are not willing to make or provide the Loan. D. Borrower has obtained a Phase I Environmental Site Assessment dated May 14, 1997, prepared by Law Engineering for each of the Atrium Building and the Pacific Plaza Building (collectively, the "Environmental Assessment"), and has delivered a copy 1 3 of the same to Lenders. Lenders intend to rely on the Environmental Assessment in making the Loan. NOW, THEREFORE, for and in consideration of Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and as a material inducement to Lenders to make or provide the Loan to Borrower, Borrower hereby covenants and agrees with Lenders as follows: 1. Definitions. The following terms as used in this Agreement will have the meanings set forth below: (a) "Hazardous Substances" will mean any hazardous or toxic substances, materials or wastes, including without limitation any flammable explosives, radioactive materials, friable asbestos, kepone, polychlorinated biphenyls (PCB's), electrical transformers, batteries, paints, solvents, chemicals, petroleum products, or other man-made materials with hazardous, carcinogenic or toxic characteristics, and such other solid, semi-solid, liquid or gaseous substances which are radioactive, toxic, ignitable, corrosive, carcinogenic to human health, those substances, materials, and wastes listed in the United States Department of Transportation Table (49 CFR 972.101) or by the Environmental Protection Agency, as hazardous substances (40 CFR Part 302, and amendments thereto) provided all such substances, materials and wastes are or become regulated under applicable local, state or federal law relating to (i) petroleum, (ii) asbestos, (iii) PCB's, or (iv) materials designated as a "hazardous substance," "hazardous waste," "hazardous materials," "toxic substances," "contaminants," in each case under any applicable Environmental Laws. (b) "Environmental Laws" will mean any applicable present or future federal, state or local laws, ordinances, rules or regulations pertaining to Hazardous Substances, including without limitation the following statutes and regulations, as amended from time to time: (i) the Federal Clean Air Act, 42 U.S.C. Section 7401 et seq.; (ii) the Federal Clean Water Act, 33 U.S.C. Section 1151 et seq.; (iii) the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. ("RCRA"); (iv) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq. ("CERCLA") and the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499, 100 Stat. 1613 ("SARA"); (v) the Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; (vi) the National Environment Policy Act, 42 U.S.C. Section 1857 et seq.; (vii) The Toxic Substance Control Act of 1976, 15 U.S.C. Section 2601 et seq.; (viii) applicable regulations of the Environmental Protection Agency, 33 CFR and 40 CFR relating to hazardous substances; and (ix) and similar statutes, rules and regulations under the laws of the State of Texas. (c) "Hazardous Condition" will mean the presence, discharge, disposal, storage or release of any Hazardous Substance, in violation of any Environmental Laws, on or in 2 4 the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or that migrates, flows, percolates, diffuses or in any way moves onto or into the improvements, air, soil, groundwater, surface water or soil vapor on or about the Property, or from the Property into adjacent property. (d) "Claims" will mean, individually and collectively, any claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses (including reasonable attorneys' and paralegals' fees and costs, whether incurred in enforcing this Agreement, collecting any sums due hereunder, settlement negotiations, at trial or on appeal), reasonable consultant fees and reasonable expert fees, together with all other reasonable costs and expenses of any kind or nature, that arise directly from or in connection with the existence of a Hazardous Condition, whether occurring before, on or after the date of this Agreement or caused by any person or entity. Without limiting the generality of the foregoing definition, Claims specifically will include claims, whether by related or third parties, for personal injury or real or personal property damage, and capital, operating and maintenance costs incurred in connection with any Remedial Work. However, notwithstanding the foregoing, Claims will not be deemed to include claims, actions, administrative proceedings, judgments, damages, punitive damages, penalties, fines, costs, liabilities, sums paid in settlement, interest, losses or expenses, that arise in connection with any Hazardous Condition that is determined by proper judicial or administrative procedure to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, foreclosure or deed in lieu of foreclosure, or which is caused by the actions of Lenders. (e) "Remedial Work" will mean any investigation or monitoring of site conditions, any clean-up, containment, remediation, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person due to the existence of a Hazardous Condition. 2. Compliance with Environmental Laws; Disclosure of Hazardous Conditions. Except as to those conditions (the "Existing Conditions") as specifically may be disclosed in the Environmental Assessment, Borrower hereby represents, warrants, covenants and agrees in all material respects to and with Lenders that all operations or activities upon, or any use or occupancy of the Property by Borrower, any tenant or other occupant, to the best of Borrower's knowledge, is presently and will at all times until Borrower's conveyance of the Property or foreclosure of Deed of Trust be in compliance with all Environmental Laws; that Borrower has not at any time engaged in or permitted, nor has any existing or previous tenant or occupant of the Property engaged in or permitted to the best of Borrower's knowledge the occurrence of any Hazardous Condition, except as specifically 3 5 may be disclosed in the Environmental Assessment; and that to the best of Borrower's knowledge, there does not now exist nor is there suspected to exist any Hazardous Condition on or about the Property, except as specifically may be disclosed in the Environmental Assessment. 3. Indemnification. Borrower hereby indemnifies and agrees to protect, defend and hold Lenders harmless, which for purposes of this paragraph will be deemed to include the directors, officers, shareholders, employees and agents of Lenders, from and against any Claims other than claims arising from Lenders' or such other included parties' gross negligence or willful misconduct, including, without limitation, any claims relating to an Existing Condition. In the event that Lenders suffer or incur any Claims, Borrower will pay to Lenders the total of all such Claims suffered or incurred by Lenders upon demand therefor by Lenders. 4. Remedial Work. In the event that any Remedial Work with respect to any Hazardous Conditions that could result in a Claim is required under any Environmental Laws by any judicial order, or by any governmental entity, or in order to comply with the terms, covenants and conditions of this Agreement or of any other agreements affecting the Property, Borrower will perform or cause to be performed the Remedial Work in compliance with such law, regulation, order or agreement. All Remedial Work will be performed by one or more contractors, selected by Borrower and under the supervision of a consulting environmental engineer selected by Borrower, and approved in advance by Lenders. All costs and expenses of Remedial Work will be paid by Borrower including without limitation the charges of such contractor(s) and the consulting environmental engineer, and Lenders' reasonable attorneys' and paralegals' fees and costs incurred in connection with monitoring or review of all Remedial Work. In the event that Borrower fails to timely commence, or cause to be commenced, or fails to diligently prosecute to completion, such Remedial Work, Lenders may, but will not be required or have any obligation to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith, will thereupon constitute Claims. All such Claims will be due and payable by Borrower upon demand therefor by Lenders. 5. Permitted Contests. Notwithstanding any provision of this Agreement to the contrary, provided that (i) no default has occurred and is continuing under the Loan Agreement, (ii) no Lenders nor any assignee of any Lenders' interest (including any person having a beneficial interest) in the Property, the Loan and the Loan Documents will be exposed or subjected to civil or criminal liability, and (iii) the lien and security interest of Lenders or any such assignee in the Property, the Loan, the Loan Documents, or the payment of any sums to be paid under the Loan Documents, is not jeopardized or in any way adversely affected, Borrower may contest or cause to be contested, by appropriate action, the application, interpretation or validity of any Environmental Laws or any agreement requiring any Remedial Work pursuant to a good faith dispute regarding such application, interpretation or validity of such Environmental Laws or agreement requiring 4 6 such Remedial Work. During the pendency of any such permitted contest, Borrower may delay performance of Remedial Work or compliance with the Environmental Laws or agreement requiring such Remedial Work, provided that (i) Borrower actually contests and prosecutes such contest by appropriate proceedings conducted in good faith and with due diligence to resolution, (ii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have given Lenders written notice that Borrower intends to contest or will contest or cause to be contested the same, and will have given such security or assurances as Lenders reasonably may request to ensure compliance with the legal requirements pertaining to the Remedial Work (and payment of all costs, expenses, interest and penalties in connection therewith) and to prevent any sale, forfeiture or loss of all or any part of the Property by reason of such noncompliance, delay or contest, and (iii) prior to any such delay in compliance with any Environmental Laws or any Remedial Work requirement on the basis of a good faith contest of such requirement, Borrower will have taken such steps as may be necessary to prevent or mitigate any continuing occurrence of any existing or suspected Hazardous Condition giving rise to the contested Remedial Work requirement. Subject to the terms and conditions set forth above, during the pendency of any such permitted contest resulting in a delay of performance of any required Remedial Work, Lenders agree that it will not perform such Remedial Work requirement on behalf of Borrower. 6. Subrogation of Indemnity Rights. If Borrower fails to perform its obligations under paragraphs 3 and 4 above, Lenders will be subrogated to any rights Borrower may have under any indemnifications from any present, future or former owners, tenants or other occupants or users of the Property relating to the matters covered by this Agreement. 7. Assignment by Lenders. No consent by Borrower will be required for any assignment or reassignment of the rights of Lenders hereunder to one or more purchasers of the Loan, the Loan Documents or Lenders' interest in the Property under the Deed of Trust. 8. Merger, Consolidation or Sale of Assets. Subject to limitations regarding disposition of any interest or control in Borrower as may be set forth in the Loan Documents, in the event of a disposition involving Borrower or all or a substantial portion of the assets of Borrower to one or more persons or other entities or the merger or consolidation of Borrower with another entity, the surviving entity or transferee of assets, as the case may be, will (i) be formed and existing under the laws of a state, district or commonwealth of the United States of America, and (ii) deliver to Lenders an acknowledged instrument in recordable form assuming all obligations, covenants and responsibilities of Borrower under this Agreement. 9. Survival; Independent Obligations. Notwithstanding anything to the contrary contained in the Loan Agreement, the obligations of Borrower under this Agreement will 5 7 survive (a) the consummation of the Loan transaction described above; (b) satisfaction of all terms and conditions to be performed by or on behalf of Borrower under the Loan Agreement; (c) termination, in accordance with their respective terms, of the Loan transaction and the Loan Agreement; (d) any assumption of Borrower's obligations under the Loan Agreement by a successor to Borrower (whether or not Lenders approved such assumption and whether or not Borrower was released from liability under the Loan Agreement); (e) conveyance of title to all or any portion of the Property to any third party, and subsequent reconveyance of all or any portion of the Property by any such third party to subsequent transferees; and (f) conveyance of title to the Property to Lenders through power of sale, process of foreclosure, or by conveyance in lieu of foreclosure of the Deed of Trust; provided, however, that Borrower will not be liable for damages resulting from Hazardous Conditions which are determined either by a written agreement or stipulation between Borrower and Lenders or, if Borrower and Lenders are unable to agree or stipulate, a final judicial or administrative action (after all available appeals have been taken or waived) to have been introduced to the Property from and after the date upon which Lenders take possession of the Property pursuant to an Order of Receivership, power of sale, process of foreclosure, or deed in lieu of foreclosure; provided, however, that the obligations of Borrower under this Agreement will finally cease and terminate upon the final expiration of any applicable statute of limitation of actions as to any potential Claim. The obligations of Borrower under this Agreement are separate and distinct from the obligations of Borrower under the Loan Agreement. This Agreement may be enforced by Lenders without regard to any other rights and remedies Lenders may have against Borrower under the Loan Agreement and without regard to any limitations on Lenders' recourse as may be provided in the Loan Agreement; provided, however, that a default by Borrower under this Agreement will constitute a default under the Loan Agreement. Enforcement of this Agreement will not be deemed to constitute an action for recovery of Borrower's indebtedness under the Loan Agreement nor for recovery of a deficiency judgment against Borrower following exercise of Borrower's remedies under the Deed of Trust. Borrower expressly and specifically agrees that Lenders may bring and prosecute a separate action or actions against Borrower hereunder whether or not Lenders have brought an action against Borrower under the Loan Agreement. 10. Default Interest. Any Claims and other payments required to be paid by Borrower to Lenders under this Agreement which are not paid on demand therefor will thereupon be considered "Delinquent," and will result in and constitute a default hereunder. In addition to all other rights and remedies of Lenders against Borrower as provided herein, or under applicable law, Borrower will pay to Lenders, immediately upon demand therefor, Default Interest (as defined below) on any such payments which are or have become Delinquent. Default Interest will be paid by Borrower from the date such payment becomes Delinquent through and including the date of payment of such Delinquent sums. As used herein, "Default Interest" will be equal to the rate of interest charged for a payment default 6 8 under the Loan Agreement, but in any event not to exceed the maximum rate of interest permitted to be contracted for under Texas law. If, in any circumstance whatsoever, interest would otherwise be payable to Lenders in excess of the maximum lawful amount, and if in any circumstance Lenders shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, and if permitted by applicable law, an amount equal to any excessive interest shall be applied to the reduction of advances under the Loan Agreement and not to the payment of interest, or if such excessive interest exceeds the unpaid advances under the Loan Agreement, such excess shall be refunded to Borrower. Borrower expressly and specifically agrees that any Default Interest charged to Borrower hereunder will in no manner or respect constitute a penalty or interest under the Loan Agreement, with the express understanding that this Agreement and Borrower's obligations hereunder constitute separate obligations of Borrower independent of the Loan Agreement. 11. Administrative Agent for Lenders. The Lenders have appointed FUNB to act as administrative agent on behalf of all of the Lenders in connection with the Loan. Accordingly, FUNB shall be entitled to exercise the rights and remedies of the Lenders hereunder as agent for each of the Lenders. Any notice provided by FUNB to the Borrower shall be deemed provided to Borrower by each of the Lenders, and any notice from Borrower which states it is to FUNB as agent for the Lenders hereunder, shall be deemed to be given to each of the Lenders. 12. Miscellaneous. If there is more than one party executing this Agreement as an indemnitor, each such party agrees that (i) the obligations of Borrower hereunder are joint and several, (ii) a release of any one or more such parties or any limitation of this Agreement in favor of or for the benefit of one or more such parties will not in any way be deemed a release of or limitation in favor of or for the benefit of any other party, and (iii) a separate action hereunder may be brought and prosecuted against one or more such parties. If any term of this Agreement or any application thereof will be invalid, illegal or unenforceable, the remainder of this Agreement and any other application of such term will not be affected thereby. No delay or omission in exercising any right hereunder will operate as a waiver of such right or any other right. This Agreement will be binding upon, inure to the benefit of and be enforceable by Borrower and Lenders, and their respective successors and assigns. This Agreement will be governed and construed in accordance with the laws of the State of Texas. The parties hereby stipulate that jurisdiction and venue for purposes of enforcement of this Agreement and adjudication of the respective rights and obligations of the parties shall be in the Texas circuit court in the judicial circuit in which the Property is located. 13. Conflict. In the event of conflict between the terms and conditions hereunder and the terms and conditions of the Loan Agreement, the terms and conditions of the Loan Agreement will govern. 7 9 14. Waiver of Defenses. In any action, suit or proceeding relating to this Agreement, Borrower and Lenders waive the right to interpose a defense of laches, failure of consideration or mutuality of remedy. 8 10 IN WITNESS WHEREOF, Borrower and Lenders have executed this Agreement as of the date first above written. BORROWER: KOGER EQUITY, INC., a Florida corporation By:/s/ G. Danny Edwards ------------------------ Name: G. Danny Edwards ---------------------- Title: Treasurer --------------------- LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent By: /s/ Andrew J. Hogshead ------------------------ Name: J. Andrew Hogshead ---------------------- Title:Vice President --------------------- 9 11 EXHIBIT A DESCRIPTION OF PROPERTY 10 EX-10.(K)(7)(D) 32 ASSIGNMENT OF CONTRACTS LICENSES AND PERMITS 1 EXHIBIT 10(k)(7)(d) ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS FROM KOGER EQUITY, INC. TO FIRST UNION NATIONAL BANK, AS AGENT DATED AS OF DECEMBER 30, 1998 2 - -------------------------------------------------------------------------------- ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS - -------------------------------------------------------------------------------- THIS ASSIGNMENT OF CONTRACTS, LICENSES AND PERMITS (this "Assignment") is made and executed this 30th day of December, 1998, by KOGER EQUITY, INC., a Florida corporation ("Borrower"), whose address is 8880 Freedom Crossing Trail, Jacksonville, Florida 32256 Attention: J.C. Teagle, President, to and in favor of FIRST UNION NATIONAL BANK, a national association, as Agent ("Lender"), for the Lenders (as such term is defined in the Loan Agreement, as hereinafter defined), whose address is 301 South College Street, Charlotte, North Carolina 28288 Attention: First Union Capital Markets Group. The terms Borrower and Lender, whenever hereinafter used will be construed to refer to and include the heirs, legal representatives, executors, administrators, successors and assigns of said parties. BACKGROUND. Borrower is indebted to Lender (the "Loan") pursuant to the following Substitution Revolving Promissory Notes and Revolving Promissory Notes: (i) Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of FUNB in the original principal amount of $45,000,000, (ii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of AmSouth in the original principal amount of $35,000,000, (iii) the Substitution Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of GFB in the original principal amount of $35,000,000, (iv) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Citizens in the original principal amount of $20,000,000, and (v) the Revolving Promissory Note dated as of even date herewith made by Borrower payable to the order of Compass in the original principal amount of $15,000,000 (the "Notes"), secured by and subject to, among other documents, that certain Deed of Trust, Assignment of Leases and Rents, and Security Agreement (the "Deed of Trust") encumbering real property and improvements now or hereafter located thereon located in Bexar County, Texas, and being more particularly described on attached Exhibit A, (the "Property"), and by a certain Second Amended and Restated Revolving Credit Loan Agreement dated as of December 30, 1998 (the "Loan Agreement") setting forth certain terms, covenants and conditions with respect to such indebtedness, all being dated as of even date herewith, given by Borrower 1 3 to Lender, which Notes, Deed of Trust and Loan Agreement, this Assignment, and other related loan documents, together with any modifications, extensions and amendments thereof, collectively are referred to herein as the "Loan Documents." In order to further secure the Obligations, as such term is defined in the Loan Agreement, Lender has requested, and Borrower has agreed to provide, this Assignment on the terms, covenants and conditions hereinafter set forth. Capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Agreement. ACCORDINGLY, as an inducement to Lender to make the Loan to Borrower, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and for the purpose of further securing the observance and performance of the Obligations, Borrower and Lender hereby agree as follows: 1. Assignment of Contract Documents. Borrower, to the extent the same are assignable, hereby grants, transfers and assigns to Lender, its successors and assigns, all of Borrower's right, title and interest in and to those contracts, licenses, permits, agreements, approvals and other documents described on attached Exhibit B (hereinafter, together with any changes, extensions, revisions, modifications or guarantees of performance thereof, called the "Contract Documents") relating to the acquisition, development, ownership or use of the Property. Lender agrees that upon the payment and performance in full of all the Obligations, this assignment shall become null and be void and of no further force and effect. 2. Representations and Warranties. Borrower represents and warrants to Lender, its successors and assigns, as follows: (a) There is no assignment of any of Borrower's rights under any of the Contract Documents to any person or entity, other than Lender. (b) Borrower is not in default under any of the Contract Documents and knows of no default on the part of any other party to any of the Contract Documents. (c) Borrower has not done nor omitted to do any act so as to be estopped from exercising any of its rights under any of the Contract Documents. (d) Borrower is not prohibited under any agreement with any other person or under any judgment or decree from the execution and delivery of this assignment or the performance of each and every covenant of Borrower hereunder or in the Contract Documents, except as may be set forth in the Contract Documents. 2 4 (e) No action has been brought or threatened which would in any way prohibit or impair the execution and delivery of this assignment or the performance of each and every covenant of Borrower hereunder or in the Contract Documents. 3. Performance of Obligations under Contract Documents. Borrower will (i) fulfill, perform and observe each and every condition and covenant of Borrower contained in any of the Contract Documents; (ii) give prompt notice to Lender of any claim of default under any of the Contract Documents given to Borrower or given by Borrower, together with a complete copy or statement of any information submitted or referenced in support of such claim; (iii) at the sole cost and expense of Borrower and in the exercise of sound business judgment, enforce the performance and observance of each and every covenant and condition of the Contract Documents to be performed or observed by any other party to any of the Contract Documents; and (iv) appear in and defend any action growing out of or in any manner connected with any of the Contract Documents. 4. Modifications and Waivers of Contract Documents. Except in the ordinary course of business and in the exercise of sound business judgment, Borrower will not (i) modify the terms of the Contract Documents unless required so to do by the terms of the Contract Documents or by law; or (ii) waive, or release any person from the observance or performance of any obligation to be performed under the terms of the Contract Documents or liability on account of any warranty given by them, unless consented to by Lender in its reasonable discretion. 5. Rights Assigned. The rights assigned hereunder include all of Borrower's right and title (i) to modify the Contract Documents; (ii) to terminate the Contract Documents; and (iii) to waive, or release the performance or observance of any obligation or condition of the Contract Documents; provided, however, these rights shall not be exercised by Lender unless Borrower is in default hereunder or an Event of Default has occurred under the other Loan Documents. 6. Defaults. Borrower shall be in default under this Assignment upon the occurrence of any of the following events: (a) Should Borrower fail to perform or observe any covenant of Borrower contained in this Assignment, and the same is not cured within ten (10) days after notice of such default is provided by Lender to Borrower; (b) Should any representation or warranty of Borrower herein contained prove untrue or misleading in any material respect; or 3 5 (c) Should Borrower fail to perform promptly any undertaking of Borrower set forth in any of the Contract Documents, and the same is not cured within ten (10) days after notice of such default is provided by Lender to Borrower. A default of Borrower under this Assignment will constitute an Event of Default under the other Loan Documents. 7. Remedies. (a) Upon the occurrence of a default hereunder, or an Event of Default as defined in the Loan Agreement, Lender may exercise its remedies as provided in the Loan Agreement, and in addition to such remedies may take possession of all Contract Documents constituting plans and specifications, site plans, surveys and architectural or engineering drawings or sketches reasonably required by Lender in the exercise of its rights and remedies hereunder. Furthermore, should Borrower fail to perform or observe any covenant or comply with any condition contained in any of the Contract Documents and such failure would cause irreparable injury to the Property including, but not limited to, the revocation or expiration of any permit or license issued in connection with the use of the Property, then Lender, but without obligation to do so, without notice to or demand on Borrower, and without releasing Borrower from its obligations to do so, may perform such covenant or condition and, to the extent that Lender shall incur any costs or pay any monies in connection therewith, including any costs or expenses of litigation, such costs, expense or payment shall be included in the indebtedness secured hereby and by the Deed of Trust and shall bear interest from the payment of such costs, monies or expenses thereof at the then applicable rate set forth in the Notes for amounts advanced by Lender on behalf of Borrower. (b) Borrower hereby indemnifies and agrees to hold harmless Lender from and against any and all losses, costs, damages, fees and expenses whatsoever associated with the exercise of Lender's rights under this Assignment and shall release Lender from all liability whatsoever for the exercise of such rights and all actions taken pursuant thereto, not including any negligent actions of Lender. (c) The remedies herein provided shall be in addition to and not in substitution for the rights and remedies which would otherwise be vested in Lender in any of the other Loan Documents, all of which rights and remedies are specifically reserved by Lender. The failure to exercise any of the remedies herein provided shall not constitute a waiver thereof, nor shall the use of any of the remedies hereby provided prevent the subsequent or concurrent resort to any other remedy or remedies. It is intended that this clause shall be broadly construed so that all remedies herein provided for or otherwise available to Lender shall remain available to Lender until all sums due it by reason of this Assignment have been paid to it in full and all obligations incurred by it in connection with the 4 6 construction or operation of the contemplated improvements on the Property have been fully discharged without loss or damage to Lender. 8. No Obligation of Lender. Lender shall not be obligated to perform or discharge any obligation of Borrower under any of the Contract Documents, and Borrower agrees to indemnify and hold Lender harmless against any and all liability, loss or damage which Lender may incur under any of the Contract Documents or under or by reason of this Assignment and of and from all claims and demands whatsoever which may be asserted against Lender by reason of an act of Lender under any of the terms of this Assignment or under the Contract Documents, provided that Lender does not perform such acts in a negligent manner. 9. Miscellaneous. This Assignment shall be binding upon Borrower, its successors and assigns, and shall inure to the benefit of Lender, its successors, successors in title and assigns. If any term of this Assignment or any application thereof will be invalid, illegal or unenforceable, the remainder of this Assignment and any other application of such term will not be affected thereby. This Assignment shall be governed by and construed in accordance with the laws of the State of Texas. In the event of conflict between the terms and conditions of this Assignment and the terms and conditions of the Loan Agreement, the terms and conditions of the Loan Agreement will govern. 10. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, THE AGENT, AND THE LENDERS, THEIR RESPECTIVE SUCCESSORS AND ASSIGNS (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") EACH ACKNOWLEDGE AND AGREE THAT NONE OF THEM SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION OR PROCEDURE BASED UPON OR ARISING OUT OF THIS ASSIGNMENT OR THE DEALINGS OR THE RELATIONSHIP BETWEEN THE PARTIES RELATED THERETO. NONE OF THE PARTIES SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION INTO ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES, ARE MADE KNOWINGLY, VOLUNTARILY AND INTENTIONALLY, AND CONSTITUTE A MATERIAL INDUCEMENT FOR THE LENDERS TO MAKE THE LOAN TO BORROWER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 5 7 IN WITNESS WHEREOF, the undersigned have caused this Assignment to be executed by their authorized officers as of the day and year first above written. BORROWER: KOGER EQUITY, INC. a Florida corporation By: /s/ G. Danny Edwards ------------------------------ Name: G. Danny Edwards ---------------------------- Title: Treasurer President ------------------ LENDER: FIRST UNION NATIONAL BANK, a national association, as Agent By:/s/ Andrew J. Hogshead ------------------------------ Name:Andrew J. Hogshead ------------------------------ Title: Vice President ------------------ Schedule of Exhibits: Exhibit A Description of Property Exhibit B Description of Contract Documents 6 8 EXHIBIT A DESCRIPTION OF PROPERTY 9 EXHIBIT B DESCRIPTION OF CONTRACT DOCUMENTS (a) All contracts or agreements, now existing or hereafter executed, with general contractors, subcontractors, materialmen, suppliers and/or laborers in connection with or pertaining to the construction of buildings or any other improvements on the Property. (b) Any contracts or agreements for land surveyor services between Borrower and any surveyor which is entered into with respect to the surveys to be prepared for the Property; and all surveys, surveyor costs, and maps prepared by any surveyor in connection with the Property. (c) Any agreements for architectural/engineering services between Borrower and any architect/engineer which is entered into with respect to the construction of improvements on the Property, and all drawings, plans and specifications, and site plans prepared by any architect/engineer in connection with the construction of improvements on the Property. (d) All warranties and guaranties relating to improvements now or hereafter constructed or installed on the Property. (e) Any management agreement between Borrower and a project operation manager related to the Property. (f) Any development fee agreement between Borrower and a project development manager related to the Property. (g) Any and all permits, licenses or other authorizations and approvals in favor of or in the name of Borrower or running with title to the Property, now or hereafter existing or granted, with respect to the ownership, development, use and occupancy of the Property for its intended purpose, including without limitation, building and excavation permits, plat and subdivision approvals, certificates of occupancy or completion, permits for driveway connection and highway signalization, storm water management, water wells, water distribution systems, sewage collection systems, dredge and fill, environmental protection, historical or archaeological protection, and any other permit, license, or other authorization necessary or advisable to comply with any governmental requirements concerning the Property or its intended use, or to comply with any private agreement concerning such Property to which 10 Borrower is a party or under or in compliance with which Borrower is bound to perform. (h) Any and all utility service agreements wherein a utility company and/or a governmental utility service provider has agreed to provide utilities to the Property. (i) Any agreement to provide sewer effluent for irrigation of the Property. (j) All contracts, binders or other agreements between Borrower and a buyer of the Property for the purchase and sale of all or any part of the Property, including such contract binders or other agreements which may hereafter come into existence with respect to the Property. EX-10.(K)(8) 33 UNCONDITIONAL GUARANTY 1 EXHIBIT 10(K)(8) UNCONDITIONAL GUARANTY December 30, 1998 Koger Equity, Inc. 8880 Freedom Crossing Trail Jacksonville, Florida 32256 ("Borrower") Koger Real Estate Services, Inc. 8880 Freedom Crossing Trail Jacksonville, Florida 32256 Southeast Properties Holding Corporation 8880 Freedom Crossing Trail Jacksonville, Florida 32256 (collectively, "Guarantor") First Union National Bank, as Agent for the Lenders One First Union Center 301 South College Street Charlotte, North Carolina 28288 (hereinafter referred to as "Agent") To induce Agent to make, extend or renew loans, advances, credit, or other financial accommodations to or for the benefit of Borrower, and in consideration of loans, advances, credit, or other financial accommodations made, extended or renewed to or for the benefit of Borrower, Guarantor hereby absolutely, irrevocably for the benefit of the Lenders (as defined in the Loan Agreement) and unconditionally guarantees to Agent and its successors, assigns and affiliates the timely payment and performance of all liabilities and obligations of Borrower to Agent, under the Second Amended and Restated Revolving Credit Loan Agreement by and between Borrower, Agent, and the Lenders (as defined therein) dated as of December 30, 1998 (the "Loan Agreement"), or under any promissory note in favor of any of the Lenders issued in connection with the Loan Agreement, however and whenever incurred or evidenced, whether primary, secondary, direct, indirect, absolute, contingent, due or to become due, now existing or hereafter contracted or acquired, and all modifications, extensions or renewals thereof, including without limitation all principal, interest, charges, and costs and expenses incurred thereunder (including attorneys' fees and other costs of collection incurred, regardless of whether suit is commenced) (collectively, the "Guaranteed Obligations"). 2 Guarantor further covenants and agrees: GUARANTORS' LIABILITY. This Guaranty is a continuing and unconditional guaranty of payment and performance and not of collection. This Guaranty does not impose any obligation on Agent to extend or continue to extend credit or otherwise deal with Borrower at any subsequent time. This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of the Guaranteed Obligations is rescinded, avoided or for any other reason must be returned by Agent or any Lender, and the returned payment shall remain payable as part of the Guaranteed Obligations, all as though such payment had not been made. Except to the extent the provisions of this Guaranty give the Agent or any Lender additional rights, this Guaranty shall not be deemed to supersede or replace any other guaranties given to Agent or any Lender by Guarantor; and the obligations guaranteed hereby shall be in addition to any other obligations guaranteed by Guarantor pursuant to any other agreement of guaranty given to Agent or any Lender and other guaranties of the Guaranteed Obligations. APPLICATION OF PAYMENTS, BANK LIEN AND SET-OFF. Monies received from any source by Agent or any Lender for application toward payment of the Guaranteed Obligations may be applied to such Guaranteed Obligations in any manner or order deemed appropriate by Agent or any Lender. If a Default occurs, Agent or any Lender is authorized to exercise its right of set-off or to foreclose its lien against the any funds of Guarantor held by Agent or any Lender, without advance notice. CONSENT TO MODIFICATIONS. GUARANTOR CONSENTS AND AGREES THAT AGENT MAY FROM TIME TO TIME, IN ITS SOLE DISCRETION, WITHOUT AFFECTING, IMPAIRING, LESSENING OR RELEASING THE OBLIGATIONS OF GUARANTOR HEREUNDER: (a) extend or modify the time, manner, place or terms of payment or performance and/or otherwise change or modify the credit terms of the Guaranteed Obligations; (b) increase, renew, or enter into a novation of the Guaranteed Obligations; (c) waive or consent to the departure from terms of the Guaranteed Obligations; (d) permit any change in the business or other dealings and relations of Borrower or any other guarantor with Agent or any Lender; (e) proceed against, exchange, release, realize upon, or otherwise deal with in any manner any collateral that is or may be held by Agent or any Lender in connection with the Guaranteed Obligations; and (f) proceed against, settle, release, or compromise with Borrower, any insurance carrier, or any other person or entity liable as to any part of the Guaranteed Obligations, and/or subordinate the payment of any part of the Guaranteed Obligations to the payment of any other obligations, which may at any time be due or owing to Agent or any Lender; all in such manner and upon such terms as Agent may deem appropriate, and without notice to or further consent from Guarantor. No invalidity, irregularity, discharge or unenforceability of, or action or omission by Agent relating to any part of, the Guaranteed Obligations or any security therefor shall affect or impair this Guaranty. 2 3 WAIVERS AND ACKNOWLEDGMENTS. GUARANTOR WAIVES AND RELEASES THE FOLLOWING RIGHTS, DEMANDS, AND DEFENSES that such Guarantor may have with respect to Agent or any Lender and collection of the Guaranteed Obligations: (a) promptness and diligence in collection of any of the Guaranteed Obligations from Borrower or any other person liable thereon, and in foreclosure of any security interest serving as collateral for the Guaranteed Obligations; (b) any law or statute that requires that Agent or any Lender make demand upon, assert claims against, or collect from Borrower or other persons or entities, foreclose any security interest, exhaust any remedies, or take any other action against Borrower or other persons or entities prior to making demand upon, collecting from or taking action against any Guarantor with respect to the Guaranteed Obligations, including any such rights Guarantor might otherwise have had under any applicable law; (c) any law or statute that requires that Borrower or any other person be joined in, notified of or made part of any action against Guarantor; (d) that Agent or any Lender preserve, insure or perfect any security interest in collateral or sell or dispose of collateral in a particular manner or at a particular time; (e) notice of extensions, modifications, renewals, or novations of the Guaranteed Obligations, of any new transactions or other relationships between Agent, any Lender, Borrower and/or any guarantor, and of changes in the financial condition of, ownership of, or business structure of Borrower or any other guarantor; (f) presentment, protest, notice of dishonor, notice of default, demand for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, notice of sale, and all other notices of any kind whatsoever; (g) the right to assert against Agent or any Lender any defense (legal or equitable), set-off, counterclaim, or claim that Guarantor may have at any time against Borrower or any other party liable to Agent or any Lender; (h) all defenses relating to invalidity, insufficiency, unenforceability, enforcement, release or impairment of Agent's or any Lender's lien on any collateral, of the Loan Documents, or of any other guaranties held by Agent or any Lender; (i) any claim or defense that acceleration of maturity of the Guaranteed Obligations is stayed against Guarantor because of the stay of assertion or of acceleration of claims against any other person or entity for any reason including the bankruptcy or insolvency of that person or entity; and (j) the benefit of any exemption claimed by Guarantor. Guarantor acknowledges and represents that Guarantor has relied upon its own due diligence in making its own independent appraisal of Borrower, Borrower's business affairs and financial condition, and any collateral; Guarantor will continue to be responsible for making its own independent appraisal of such matters; and Guarantor has not relied upon and will not hereafter rely upon Agent or any Lender for information regarding Borrower or any collateral. INTEREST. Regardless of any other provision of this Guaranty or other Loan Documents, if for any reason the effective interest on any of the Guaranteed Obligations should exceed the maximum lawful interest, at the time performance of such provision will be due, then ipso facto, the obligation to be fulfilled will be reduced 3 4 to the maximum limit of such validity, and if for any circumstances whatsoever Agent will ever receive interest, the amount of which would exceed the highest lawful rate, such amount which would be excessive interest will be applied to the reduction of the principal balance remaining unpaid under the Guaranteed Obligations, and not to the payment of interest. At all times thereafter the rate of interest in effect will continue at such maximum rate until otherwise adjusted in accordance with the terms of this Guaranty and the Loan Agreement. ATTORNEY'S FEES AND OTHER COSTS OF COLLECTION. Guarantor shall pay all of Agent's and any Lender's reasonable expenses incurred to enforce or collect any of the Guaranteed Obligations, including, without limitation, reasonable arbitration, paralegals', attorneys' and experts' fees and expenses, whether incurred without the commencement of a suit, in any suit, arbitration, or administrative proceeding, or in any appellate or bankruptcy proceeding. MISCELLANEOUS. (a) ASSIGNMENT. This Guaranty and the other Loan Documents shall inure to the benefit of and be binding upon the parties and their respective heirs, legal representatives, successors and assigns. Agent's interests in and rights under this Guaranty and the other Loan Documents are freely assignable, in whole or in part, by Agent. Any assignment shall not release Guarantor from the Guaranteed Obligations. (b) APPLICABLE LAW; CONFLICT BETWEEN DOCUMENTS. This Guaranty and the other Loan Documents shall be governed by and construed under the laws of the State of North Carolina. If the terms of this Guaranty should conflict with the terms of any commitment letter that survives closing, the terms of this Guaranty shall control. (c) JURISDICTION. Guarantor irrevocably agrees to non-exclusive personal jurisdiction in the State of North Carolina. (d) SEVERABILITY. If any provision of this Guaranty or of the other Loan Documents shall be prohibited or invalid under applicable law, such provision shall be ineffective but only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Guaranty or other document. (e) NOTICES. Any notices to Guarantor shall be sufficiently given, if in writing and mailed or delivered to Guarantor's address shown above or such other address as provided hereunder, and to Agent, if in writing and mailed or delivered to Agent's office address shown above or such other address as Agent may specify in writing from time to time. In the event that Guarantor changes its address at any time prior to the date the Guaranteed Obligations are paid in full, Guarantor agrees to promptly give written notice of said change of address by registered or certified mail, return receipt requested, all charges prepaid. (f) PLURAL; CAPTIONS. All references in the Loan Documents to borrower, guarantor, person, document or other nouns of reference mean both the singular and plural form, as the case may be, and the term "person" shall mean any individual, person or entity. The captions contained in the Loan Documents are inserted for convenience only and shall not affect the meaning or interpretation of the Loan Documents. (g) BINDING CONTRACT. Guarantor, by execution of and Agent by acceptance of this Guaranty, agree that each 4 5 party is bound to all terms and provisions of this Guaranty. (h) AMENDMENTS, WAIVERS AND REMEDIES. No waivers, amendments or modifications of this Guaranty and the other Loan Documents shall be valid unless in writing and signed by an officer of Agent. No waiver by Agent of any Default shall operate as a waiver of any other Default or the same Default on a future occasion. Neither the failure nor any delay on the part of Agent in exercising any right, power, or privilege granted pursuant to this Guaranty and the other Loan Documents shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise or the exercise of any other right, power or privilege. All remedies available to Agent with respect to this Guaranty and the other Loan Documents and remedies available at law or in equity shall be cumulative and may be pursued concurrently or successively. (i) PARTNERSHIPS. If Guarantor is or becomes a partnership, the obligations, liabilities and agreements on the part of such Guarantor shall remain in full force and effect and fully applicable notwithstanding any changes in the individuals comprising the partnership. The term "Guarantor" includes any altered or successive partnerships, and predecessor partnership(s) and the partners shall not be released from any obligations or liabilities hereunder. (j) LOAN DOCUMENTS. The term "Loan Documents" refers to all documents executed in connection with the Guaranteed Obligations and may include, without limitation, that certain credit facility made available by Agent to Borrower pursuant to that certain Second Amended and Restated Revolving Credit Loan Agreement as of December 30, 1998 between Agent and Borrower and the other documents relating thereto, any commitment letters that survive closing, other loan agreements, other guaranty agreements, security agreements, instruments, financing statements, mortgages, deeds of trust, deeds to secure debt, letters of credit and any amendments or supplements thereto(excluding swap agreements as defined in 11 U.S. Code ss. 101). ARBITRATION. Upon demand of any party hereto, whether made before or after institution of any judicial proceeding, any dispute, claim or controversy arising out of, connected with or relating to this Guaranty and other Loan Documents ("Disputes") between or among parties to this Guaranty shall be resolved by binding arbitration as provided herein. Institution of a judicial proceeding by a party does not waive the right of that party to demand arbitration hereunder. Disputes may include, without limitation, tort claims, counterclaims, disputes as to whether a matter is subject to arbitration, claims brought as class actions, claims arising from Loan Documents executed in the future, or claims arising out of or connected with the transaction reflected by this Guaranty. Arbitration shall be conducted under and governed by the Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules") of the American Arbitration Association (the "AAA") and Title 9 of the U.S. Code. All arbitration hearings shall be conducted in the City of Charlotte, State of North Carolina. The expedited procedures set forth in Rule 51 et seq. of the Arbitration Rules shall be applicable to claims of less 5 6 than $1,000,000.00. All applicable statutes of limitation shall apply to any Dispute. A judgment upon the award may be entered in any court having jurisdiction. The panel from which all arbitrators are selected shall be comprised of licensed attorneys. The single arbitrator selected for expedited procedure shall be a retired judge from the highest court of general jurisdiction, state or federal, of the state where the hearing will be conducted or if such person is not available to serve, the single arbitrator may be a licensed attorney. Notwithstanding the foregoing, this arbitration provision does not apply to disputes under or related to swap agreements. PRESERVATION AND LIMITATION OF REMEDIES. Notwithstanding the preceding binding arbitration provisions, Agent and Guarantor agrees to preserve, without diminution, certain remedies that any party hereto may employ or exercise freely, independently or in connection with an arbitration proceeding or after an arbitration action is brought. Agent and Guarantor shall have the right to proceed in any court of proper jurisdiction or by self-help to exercise or prosecute the following remedies, as applicable: (i) all rights to foreclose against any real or personal property or other security by exercising a power of sale granted under Loan Documents or under applicable law or by judicial foreclosure and sale, including a proceeding to confirm the sale; (ii) all rights of self-help including peaceful occupation of real property and collection of rents, set-off, and peaceful possession of personal property; (iii) obtaining provisional or ancillary remedies including injunctive relief, sequestration, garnishment, attachment, appointment of receiver and filing an involuntary bankruptcy proceeding; and (iv) when applicable, a judgment by confession of judgment. Preservation of these remedies does not limit the power of an arbitrator to grant similar remedies that may be requested by a party in a Dispute. Guarantor and Agent agree that they shall not have a remedy of punitive or exemplary damages against the other in any Dispute and hereby waive any right or claim to punitive or exemplary damages they have now or which may arise in the future in connection with any Dispute whether the Dispute is resolved by arbitration or judicially. CONFLICT WITH CREDIT AGREEMENT. This Unconditional Guaranty is being executed in connection with the Loan Agreement. In the event of a conflict between the terms of the Loan Agreement and this Unconditional Guaranty, the terms of the Loan Agreement shall prevail. 6 7 IN WITNESS WHEREOF, Guarantor, on the day and year first written above, has caused this Unconditional Guaranty to be executed and delivered by a duly authorized officer thereof. Koger Real Estate Services, Inc., a Florida corporation Taxpayer ID No: 59-3213613 By /s/ W. Lawrence Jenkins ----------------------------------------------------- Name: W. Lawrence Jenkins ---------------------------------------------- Title: Corporate Secretary & Vice President --------------------------------------------- Southeast Properties Holding Corporation, a Florida corporation Taxpayer ID No: 59-3202967 By /s/ W. Lawrence Jenkins ----------------------------------------------------- Name: W. Lawrence Jenkins ---------------------------------------------- Title: Corporate Secretary & Vice President --------------------------------------------- 7 EX-99 34 PRESS RELEASE 1 EXHIBIT 99 NEWS KOGER EQUITY, INC. INCREASES ITS REVOLVING CREDIT FACILITY JACKSONVILLE, FLORIDA, January 5, 1999 -- Koger Equity, Inc. (ASE:KE), a Jacksonville, Florida-based real estate investment trust, announced today that its secured revolving credit facility has been increased from $100,000,000 to $150,000,000. The credit facility is provided by First Union National Bank, as Arranger and Administrative Agent, AmSouth Bank, as Syndication Agent, along with Guaranty Federal Bank, Citizens Bank of Rhode Island and Compass Bank, as participants. The facility is for a term of three years. Victor A. Hughes, Jr., Chairman of the Board and Chief Executive Officer of Koger said, "We are very pleased with the confidence the institutional lenders involved with this facility have shown in the Company in these difficult credit markets. With the increase of this facility, we will be able to completely satisfy our new construction and development cash needs for our 1999 business plan." Koger Equity owns and operates 12.1 million feet of office space located in 15 cities in the Southeast and Southwest. It provides management services to third parties for 1.6 million feet located in four Southeastern cities. ### -----END PRIVACY-ENHANCED MESSAGE-----