SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-A/A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
KOGER EQUITY, INC.
- --------------------------------------------------------------------------------
Florida 1-9997 59-2898045
- --------------------------------------------------------------------------------
(State or incorporation (Commission (IRS Employer
or organization) File Number) Identification No.)
3986 Boulevard Center Drive, Suite 101
Jacksonville, Florida 32207
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b)
of the Act:
COMMON STOCK PURCHASE RIGHTS
- --------------------------------------------------------------------------------
(Title of Class)
AMERICAN STOCK EXCHANGE
- --------------------------------------------------------------------------------
Name of each exchange on which each class
is to be registered
Securities to be registered pursuant to Section 12(g) of the Act:
NONE
- --------------------------------------------------------------------------------
(Title of Class)
1
<PAGE>
Item 1. Description of Securities to be Registered.
On September 30, 1990, the Board of Directors (the "Board") of Koger
Equity, Inc. (the "Company") declared a dividend of one Common Stock purchase
right (a "Right") for every outstanding share of the Company's common stock, par
value $.01 per share, (the "Common Stock"). The Rights were distributed to
stockholders of record as of the close of business on October 11, 1990 (the
"Dividend Record Date"). The terms of the Rights are set forth in a Common Stock
Rights Agreement, dated September 30, 1990, as amended and in effect from time
to time (the "Rights Agreement"), between the Company and Wachovia Bank and
Trust Company, N.A., the initial rights agent whose successor is First Union
National Bank of North Carolina, a national association, (the "Rights Agent")
appointed pursuant to First Amendment to Koger Equity, Inc. Common Stock Rights
Agreement, dated as of March 22, 1993 (the "First Amendment"). The Rights
Agreement provided for the issuance of one Right for every share of Common Stock
issued and outstanding on the Dividend Record Date and for each share of Common
Stock which was or is issued after that date and prior to the "Distribution
Date" (as defined below).
Each Right entitles the holder to purchase from the Company one share
of Common Stock at a price of $50 per share, subject to adjustment. The Rights
will expire on September 30, 2000 (the "Expiration Date"), or the earlier
redemption of the Rights, and are not exercisable until the Distribution Date.
No separate Rights certificates have been issued. Until the
Distribution date (or earlier redemption or expiration of the Rights), (i) the
Rights will be evidenced by the Common Stock certificates and will be
transferred with and only with such Common Stock certificates, (ii) new Common
Stock certificates issued after the Dividend Record Date upon transfer or new
issuance of the Company's Common Stock contained a notation incorporating the
Rights Agreement by reference and (iii) the surrender for transfer of any of the
Company's Common Stock certificates also constitutes the transfer of the Rights
associated with the Common Stock represented by such certificate.
The Rights will separate from the Common Stock and Rights certificates
will be issued on the Distribution Date. Unless otherwise determined by a
majority of the Continuing Directors (as defined below), the Distribution Date
will occur on the earlier of (i) the fifteenth business day following the later
of the date of a public announcement that a person, including affiliates or
associates or associates of such person (an "Acquiring Person"), except as
described below, has acquired or obtained the right to acquire, beneficial
ownership of 15% or more of the outstanding shares of Common Stock or the date
on which an executive officer of the Company has actual knowledge that an
Acquiring Person became such (the "Stock Acquisition Date") or (ii) the
fifteenth business day following commencement of a tender offer or exchange
offer that would result in any person or its affiliates and associates owning
15% or more of the Company's outstanding Common Stock. In any event, the Board
of Directors may delay the distribution of the certificates. After the
2
<PAGE>
Distribution Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of the Company's Common Stock
as of the close of business on the Distribution Date and such separate Rights
Certificates alone will evidence the Rights. "Continuing Director" shall mean
any director of the Company who was either (i) a Director prior to the time a
Person becomes an Acquiring Person and is not an Affiliate of such Person or
(ii) nominated for his or her term of office by a majority of the Continuing
Directors in office at the time of such nomination.
Pursuant to the Second Amendment to the Koger Equity, Inc. Common Stock
Rights Agreement, dated as of December 21, 1993, (the "Second Amendment"), TCW
Special Credits, a California general partnership, the TCW Group, Inc. and their
Affiliates (collectively "TCW") will not be considered an Acquiring Person, and
shall be an "Exempt Person", but only so long as TCW is the Beneficial Owner of
shares of Common Stock outstanding in an amount not in excess of an aggregate of
the higher of (i) 23% of the shares of Common Stock then outstanding and (ii)
4,047,350 shares of Common Stock, as adjusted for any stock splits, stock
dividends or other recapitalizations of the Company on or after December 21,
1993. Pursuant to Amendment No. 3 to the Rights Agreement, dated as of October
10, 1996 (the "Third Amendment"), collectively (a) AP-KEI Holdings, LLC, a
Delaware limited liability company ("Apollo"), and its Affiliates (as defined in
the Stock Purchase Agreement dated as of October 10, 1996, as amended and in
effect from time to time (the "Stock Purchase Agreement") between the Company
and Apollo) will not be considered an Acquiring Person, and shall be an "Exempt
Person", but only so long as neither Apollo nor any of its Affiliates (as
defined in the Stock Purchase Agreement) is the Beneficial Owner (as defined in
the Stock Purchase Agreement) of any Prohibited Security (as defined in the
Stock Purchase Agreement) and (b) any person who is an Affiliate of Apollo to
the extent that such Affiliate would be an Acquiring Person as a result of
Beneficially Owning any Permitted Securities (as defined in the Stock Purchase
Agreement) will not be considered an Acquiring Person and shall be an Exempt
Person. Pursuant to the Fourth Amendment to Common Stock Rights Agreement dated
as of February 27, 1997 (the "Fourth Amendment"), if any Exempt Person described
in the immediately preceding sentence (each an "Apollo Exempt Person") (1)
pledges any Permitted Securities to one or more financial institutions described
in the Rights Agreement (the "Permitted Assignees") and (2) any such Permitted
Assignee purchases any such Permitted Securities in connection with any
foreclosure proceedings, then (A) each Apollo Exempt Person shall immediately
and automatically cease to be an Exempt Person and (B) such Permitted Assignees,
collectively, shall be deemed to be an Exempt Person, but only so long as none
of such Permitted Assignees is the Beneficial Owner of any Prohibited Security.
(The Fourth Amendment also sets forth in their entirety certain definitions set
forth in the Stock Purchase Agreement and cross-referenced in the Third
Amendment.) According to Company records, at March 13, 1997, the TCW Group, Inc.
and its affiliates beneficially own less than 5% of the outstanding Common
Stock. At March 13, 1997, Apollo and its Affiliates beneficially own
approximately 22.6% of the outstanding Stock with the right to acquire an
additional 2.4% or in the aggregate 25% of the outstanding Common Stock either
from the Company or in the market at the option of the Company which holdings
would be Permitted Securities (as defined in the Stock Purchase Agreement). In
addition, any employee benefit plan of the Company will not be considered an
Acquiring Person.
3
<PAGE>
Under the provisions described above, the continued holding of such
shares by Exempt Persons will not cause the Rights to be exercisable. Any
transfer of shares held by an Exempt Person to a third party who, after such
transfer, beneficially owns 15% or more of the outstanding shares of Common
Stock would cause the Rights to become exercisable, except in the case of a
foreclosure by a pledgee of Apollo or its Affiliates of Permitted Securities if
such pledgee purchases the securities at the foreclosure sale. In addition, any
institution of a tender or exchange offer by an Exempt Person would also trigger
the exercisability of the Rights.
If, at any time after the Stock Acquisition Date, the Company were
acquired in a merger or other business combination, or more than 25% of its
assets or earning power were sold, each holder of a Right would have the right
to exercise such Right and thereby receive common stock of the acquiring company
with a market value of two times the exercise price of the Right. For example,
if the exercise price is $50, the holder of each Right would be entitled to
receive $100 in market value of the acquiring company's common shares (e.g., 10
shares if the per share market value is $10) for $50. Also, in the event that
(i) any person or group or affiliated or associated persons (other than the
Company, its subsidiaries, employee benefit plans and an Exempt Person) shall
become an Acquiring Person, or (ii) an Acquiring Person engages in one of a
number of self-dealing transactions specified in the Rights Agreement, each
holder of a Right will, upon payment of the exercise price, have the right to
receive shares of the Company's Common Stock (or, in certain circumstances,
cash, property or other securities of the Company) having a market value of two
times the exercise price of the Right. If the exercise price is $50, the holder
of each right would be entitled to receive $100 in market value of the Company's
common stock for $50. Following the occurrence of any of the events described in
this paragraph (as defined in the Rights Agreement, a "Common Stock Event"), any
rights that are, or (under certain circumstances specified in the Rights
Agreement) were, beneficially owned by any Acquiring Person (or any affiliates,
associates or transferees of any Acquiring Person) shall immediately become null
and void.
The Board may, at its option, at any time after any Person becomes an
Acquiring Person, exchange all or part of the then outstanding and exercisable
Rights for shares of Common Stock at an exchange ratio of one share of Common
Stock per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date of declaration of the
Rights (such exchange ratio being hereinafter referred to as the "Exchange
Ratio"). The Board, however, may not effect an exchange at any time after any
person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any such Subsidiary, any entity holding Common
Stock for or pursuant to the terms of any such plan or any Exempt Person),
together with all affiliates of such Person, becomes the beneficial owner of 50%
or more of the Common Stock then outstanding. Immediately upon the action of the
Board ordering the exchange of any Rights and without any further action and
without any notice, the right to exercise such Rights will terminate and the
only right thereafter of a holder of such Rights will be to receive that number
of shares of Common Stock equal to the number of such Rights held by the holder
multiplied by the Exchange Ratio.
4
<PAGE>
The exercise price of the Rights, and the number of whole or fractional
shares of the Common Stock or other securities or property issuable upon
exercise of the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a subdivision, combination
or reclassification of, the Common Stock, (ii) upon the grant to holders of the
Common Stock of certain rights or warrants to subscribe for shares of the Common
Stock or convertible securities at less than the current market price of the
Common Stock of evidences of indebtedness or assets (excluding cash dividends
paid out of the earnings or retained earnings of the Company and certain other
distributions) or of subscription rights or warrants (other than those referred
to above).
With certain exceptions, no adjustments in the exercise price of the
Rights will be required until cumulative adjustments equal at least 1% in such
price. The Company is not obligated to issue fractional shares of any securities
upon the exercise of the Rights and, in lieu thereof, at the election of the
Company, an adjustment in cash may be made based on the market price of such
securities on the last trading date prior to the date of exercise.
At any time prior to the Expiration Date, the Company, by a majority
vote of the Continuing Directors then in office, may redeem the Rights at a
redemption price of $.01 per Right (the "Redemption Price"), as described in the
Rights Agreement. Immediately upon the action of the Continuing Directors
electing to redeem the Rights, the right to exercise the Rights will terminate
and the only right of the holders of Rights will be to receive the Redemption
Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
Neither the distribution of the Rights nor the subsequent separation of
the Rights on the Distribution Date will be a taxable event for the Company or
its stockholders. Holders of Rights may, depending upon the circumstances,
recognize taxable income upon the occurrence of a Common Stock Event. In
addition, holders of Rights may have taxable income as a result of (i) an
exchange by the Company of shares of Common Stock for Rights as described above
or (ii) certain anti-dilution adjustments made to the terms of the Rights after
the Distribution Date. A redemption of the Rights would be a taxable event to
holders.
The Rights Agreement may be amended by the Continuing Directors at any
time prior to the Distribution Date without the approval of the holders of the
Rights, provided, however no amendment may prejudice the rights of an Exempt
Person. From and after the Distribution Date, the Rights Agreement may be
amended without the approval of the holders of the Rights in order to cure any
ambiguity, to correct any defective or inconsistent provisions, to change any
time period for redemption or any other time period under the Rights Agreement
or to make any other changes that do not adversely affect the interests of the
holders of the Rights (other than any Acquiring Person or its affiliates,
associates or transferees).
5
<PAGE>
As of February 28, 1997, there were 23,606,109 shares of Common Stock
outstanding. Each share of Common Stock outstanding on the Dividend Record Date
received one Right. As long as the Rights are attached to the Common Stock, the
Company has issued and will issue one Right with each newly issued share of
Common Stock so that all shares of Common Stock outstanding on the Distribution
Date will have attached Rights.
The exercise of the Rights may have certain anti-takeover effects. The
Rights distribution will not be dilutive of shareholder's ownership of the
Company and will not affect reported earnings per share. The Company will
receive no proceeds from the distribution of the Rights.
The Rights Agreement (including as exhibits thereto the form of Rights
Certificate and the Summary of Rights), the First Amendment, the Second
Amendment, the Third Amendment and the Fourth Amendment are attached hereto as
exhibits hereto and are hereby incorporated herein by reference. The foregoing
description of the Rights does not purport to be complete and therefore is
qualified in its entirety by reference to such exhibits.
Item 2. Exhibits.
The exhibits which are filed with this amendment are set forth in the
Exhibit Index which appears at page 8 hereof.
6
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this amendment to the registration
statement to be signed on its behalf by the undersigned, thereto duly
authorized.
KOGER EQUITY, INC.
Date: March 17, 1997 By: /s/ W. LAWRENCE JENKINS
W. Lawrence Jenkins
Vice President/Administration
and Corporate Secretary
7
<PAGE>
EXHIBIT INDEX
The following designated exhibits are filed herewith:
Exhibits
1. Common Stock Rights Agreement,
dated as of September 30, 1990 (the "Rights
Agreement"), between Koger Equity, Inc.
(the "Company") and Wachovia Bank and
Trust Company, N.A. as Rights Agent.(1)
2. Form of Common Stock Purchase Rights
Certificate (attached as Exhibit A to the Rights
Agreement). Pursuant to the Rights Agreement,
printed Common Stock Purchase Rights
Certificates will not be mailed until the
Distribution Date (as defined in the Rights
Agreement).(1)
3. Summary of Common Stock Purchase Rights
(attached as Exhibit B to the Rights Agreement).(1)
4. First Amendment to Koger Equity, Inc.
Common Stock Rights Agreement, dated as of
March 22, 1993, between the Company and
First Union National Bank of North Carolina, a
national association, as successor Rights Agent
("First Union").(2)
5. Second Amendment to Koger Equity, Inc.
Common Stock Rights Agreement, dated as of
December 21, 1993, between the Company
and First Union.(2)
(1) Filed with original Form 8-A
(2) Filed with amendment on Form 8-A/A,
dated December 21, 1993
(3) Filed with Amendment on Form 8-A/A,
dated November 7, 1996
(4)Filed herewith
8
<PAGE>
EXHIBIT INDEX (Continued)
Exhibits
6. Amendment No. 3 to Rights Agreement, dated
as of October 10, 1996, between the Company
and First Union.(3)
7. Stock Purchase Agreement, dated as of October
10, 1996, between the Company and AP-KEI
Holdings, LLC.(3)
8. Fourth Amendment to Common Stock Rights
Agreement, dated as of February 27, 1997.(4)
9. Amendment No. 1 to Stock Purchase Agreement,
dated as of February 27, 1997, between the
Company and AP-KEI Holdings, LLC.(4)
10. Assignment and Assumption Agreement, dated
as of February 27, 1997, among the Company,
AP-KEI Holdings, LLC and AREIF Realty
Trust, Inc.(4)
(1) Filed with original Form 8-A
(2) Filed with amendment on Form 8-A/A,
dated December 21, 1993
(3) Filed with Amendment on Form 8-A/A,
dated November 7, 1996
(4)Filed herewith
9
<PAGE>
<PAGE>
Exhibit 10
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Agreement dated as of February 27, 1997 is between Koger Equity, Inc., a
Florida corporation (the "Company"), AP-KEI Holdings, LLC, a Delaware limited
liability company (the "Investor") and AREIF II Realty Trust, Inc., a Maryland
corporation (the "Assignee").
WHEREAS, under the terms of that certain Stock Purchase Agreement dated as of
October 10, 1996 (the "Stock Purchase Agreement") by and between the Company and
the Investor, the Investor Beneficially Owns 4,713,598 shares of Common Stock
(the "Stock"), which are Permitted Securities under the Stock Purchase
Agreement;
WHEREAS, in connection with its transfer of the Stock to the Assignee,
Investor desires to assign its rights under the Stock Purchase Agreement to the
Assignee to the extent permitted in Section 9.4 thereof;
WHEREAS, it is a condition to the validity of such assignment that the
Assignee execute and deliver to the Company this Assignment and Assumption
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledges, the parties agree as follows:
1. Definitions. Capitalized terms are used herein with the meanings
provided in the Stock Purchase Agreement.
2. Assignment. Investor hereby transfers, assigns and sets over to
Assignee all of its right, title and interest in and to, and its rights
under, the Stock Purchase Agreement.
3. Assumption. Assignee hereby agrees with the Company to assume and be
bound by all of the obligations of Investor to the Company under the
Stock Purchase Agreement. Assignee confirms to the Company that it is
an Affiliate of Investor, as defined in the Stock Purchase Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption Agreement to be duly executed as of the day and year first above
written.
KOGER EQUITY, INC.
By /s/ Victor A. Hughes, Jr.
Name: Victor A. Hughes, Jr.
Title: Chairman and President
AP-KEI HOLDINGS, LLC, as Investor
By AP-MM KEI HOLDINGS, LLC,
its Managing Member
By KRONUS PROPERTY, INC,
its Managing Member
By /s/ Stuart F. Koenig
Name: Stuart F. Koenig
Title: Vice President
AREIF II REALTY TRUST, INC., as Assignee
By /s/ Stuart F. Koenig
Name: Stuart F. Koenig
Title: Vice President
<PAGE>
<PAGE>
Exhibit 9
AMENDMENT NO. 1 TO STOCK PURCHASE AGREEMENT
This Agreement, dated as of February 27, 1997 is between Koger Equity,
Inc., a Florida corporation (the "Company"), and AP-KEI Holdings, LLC, a
Delaware limited liability company ("Apollo"). The parties agree as follows:
1. Reference to Stock Purchase Agreement; Definitions. Reference is made to the
Stock Purchase Agreement dated as of October 10, 1996, as in effect on the date
hereof prior to giving effect to this Agreement (the "Stock Purchase
Agreement"), between the Company and Apollo. Terms defined in the Stock Purchase
Agreement, as amended hereby (the "Amended Stock Purchase Agreement"), and not
otherwise defined herein are used herein with the meanings so defined.
2. Amendments to Stock Purchase Agreement.
2.1. Amendment to Definition of "Affiliate". The definition of
"Affiliate" set forth in Section 7.1 of the Stock Purchase Agreement is amended
to read in its entirety as follows:
"Affiliate: An "affiliate" of, or a person "affiliated" with,
a specified person is (1) a person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under
common control with the person specified or (2) any relative or spouse
of such person, or any relation of such spouse, who has the same home
as such person. As used in this definition, the term "control"
(including the terms "controlling", "controlled by" and "under common
control") means the possession, direct or indirect, of the power,
whether exercised or not, to direct or cause the acquisition and/or
disposition by such person of securities of the Company, whether
through the ownership of voting securities or otherwise. To clarify the
foregoing, a Person (including, without limitation, partners, members
of limited liability companies, or co-investors) which would, under the
foregoing definitions, be an "Affiliate" solely by reason of its common
control with a specified person or an Affiliate of such specified
person shall not be an "Affiliate" of such specified person. The term
Affiliates of Apollo includes, without limitation, (i) as of the
Closing Date, the persons and entities listed on Schedule 7.1; (ii) any
person employed by Apollo or any of its Affiliates who replaces any
individual named on Schedule 7.1 or who holds the same or any
comparable position for Apollo or any of its Affiliates listed on
Schedule 7.1; (iii) any Associate which satisfies the provisions of
clauses (1) or (2) of the first sentence of this definition; and (iv)
AREIF II Realty Trust, Inc., a Maryland corporation."
<PAGE>
2.2. Amendment to Definition of "Eligible Institution". The definition
of "Eligible Institution" set forth in Section 7.1 of the Stock Purchase
Agreement is amended to read in its entirety as follows:
"Eligible Institution: shall mean (a) a commercial bank or
investment bank organized, or any subsidiary, branch or agency of a
foreign commercial bank or investment bank operating, under the laws of
the United States, or any State thereof, and having total assets in
excess of $1,000,000,000; (b) a savings and loan association or savings
bank organized under the laws of the United States, or any State
thereof, and having total assets in excess of $1,000,000,000; or (c) a
finance company, insurance company or other financial institution
organized under the laws of the United States, or any State thereof,
that is engaged in purchasing or otherwise investing in commercial
loans in the ordinary course of business, having total assets in excess
of $100,000,000."
3. General. The Amended Stock Purchase Agreement is confirmed as being in full
force and effect. This Agreement, the Amended Stock Purchase Agreement and the
other documents referred to herein or therein constitute the entire
understanding of the parties with respect to the subject matter hereof and
thereof and supersede all prior and current understandings and agreements,
whether written or oral, with respect to such subject matter. The invalidity or
unenforceability of any provision hereof shall not affect the validity or
enforceability of any other term or provision hereof. The headings in this
Agreement are for convenience of reference only and shall not alter, limit or
otherwise affect the meaning hereof. Each of this Agreement and the Amended
Stock Purchase Agreement may be executed in any number of counterparts, which
together shall constitute one instrument, and shall bind and inure to the
benefit of the parties and their respective successors and permitted assigns.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
(OTHER THAN THE CONFLICT OF LAWS RULES) OF THE STATE OF NEW YORK.
<PAGE>
Each of the undersigned has executed this Agreement under seal by a
duly authorized officer as of the date first set forth above.
KOGER EQUITY, INC.
By /s/ Victor A. Hughes, Jr.
Name: Victor A. Hughes, Jr.
Title: Chairman and President
AP-KEI HOLDINGS, LLC, as Investor
By AP-MM KEI HOLDINGS, LLC,
its Managing Member
By KRONUS PROPERTY, INC,
its Managing Member
By /s/ Stuart Koenig
Name: Stuart F. Koenig
Title: Vice President
<PAGE>
<PAGE>
Exhibit 8
FOURTH AMENDMENT TO COMMON STOCK RIGHTS AGREEMENT
This Fourth Amendment to Common Stock Rights Agreement dated as of February
27, 1997 (the "Amendment") is between Koger Equity, Inc., a Florida corporation
(the "Company") and First Union National Bank of North Carolina, as successor
Rights Agent (the "Rights Agent"), and amends the Common Stock Rights Agreement
dated as of September 30, 1990 (as amended and in effect on the date hereof
prior to giving effect to the Amendment, the "Rights Agreement"), between the
Company and the Rights Agent. Terms defined in the Rights Agreement as amended
hereby and not otherwise defined herein are used herein as so defined.
W I T N E S S E T H:
WHEREAS, on September 30, 1990 the Board of Directors of the Company
authorized the issuance of Rights to purchase, on the terms and subject to the
provisions of the Rights Agreement, shares of the Company's Common Stock; and
WHEREAS, on September 30, 1990, the Board of Directors of the Company
authorized and declared a dividend distribution of one Right for every share of
Common Stock of the Company outstanding on the Dividend Record Date and
authorized the issuance of one Right (subject to certain adjustments) for each
share of Common Stock of the Company issued between the Dividend Record Date and
the Distribution Date; and
WHEREAS, the Distribution Date has not occurred; and
WHEREAS, pursuant to Section 27 of the Rights Agreement, the Continuing
Directors have unanimously approved an amendment of certain provisions of the
Rights Agreement as set forth below;
NOW, THEREFORE, the parties hereto agree as follows:
1. New Sections 1(c)-A, 1(c)-B, 1(c)-C and 1(c)-D are added to the Rights
Agreement immediately after Section 1(c) of the Rights Agreement to read in
their entirety as follows:
"(c)-A "Apollo" shall mean AP-KEI Holdings, LLC, a Delaware limited
liability company.
(c)-B "Apollo Affiliate" shall mean (1) a person that directly,
or indirectly through one or more intermediaries, controls, or is controlled
by, or is under common control with the person specified or (2) any relative
or spouse of such person, or any relation of such spouse, who has the same
<PAGE>
homeas such person. As used in this definition, the term "control"
(including the terms "controlling", "controlled by" and "under common
control") means the possession, direct or indirect, of the power, whether
exercised or not, to direct or cause the acquisition and/or disposition by
such person of securities of the Company, whether through the ownership of
voting securities or otherwise. To clarify the foregoing, a Person
(including, without limitation, partners, members of limited liability
companies, or co-investors) which would, under the foregoing definitions, be
an "Apollo Affiliate" solely by reason of its common control with a
specified person or an Apollo Affiliate of such specified person shall not
be an "Apollo Affiliate" of such specified person. The term Apollo Affiliate
includes, without limitation, (i) as of the Closing Date (as that term is
defined in the Stock Purchase Agreement) of the Stock Purchase Agreement,
the persons and entities listed on Schedule 7.1 to the Stock Purchase
Agreement; (ii) any person employed by Apollo or any of the Apollo
Affiliates who replaces any individual named on Schedule 7.1 to the Stock
Purchase Agreement or who holds the same or any comparable position for
Apollo or any of the Apollo Affiliates listed on Schedule 7.1 to the Stock
Purchase Agreement; (iii) any Associate (as that term is defined in the
Stock Purchase Agreement) which satisfies the provisions of clauses (1) or
(2) of the first sentence of this definition; and (iv) AREIF II Realty
Trust, Inc., a Maryland corporation.
(c)-C The term "Apollo Beneficial Owner" (including, without
limitation, "Apollo Beneficial Ownership" and "Apollo Beneficially Owned")
shall have the meanings provided in Section 1(d), except that the term
"Affiliate" therein shall be defined for purposes of this Section 1(c)-C as
Apollo Affiliate. In addition, for purposes of this Section 1(c)-C, if
Apollo or any of the Apollo Affiliates shall form a "group" (as contemplated
by Rule 13d-5(b)(1) under the Exchange Act) with any person, including,
without limitation, any Associate (as that term is defined in the Stock
Purchase Agreement) of Apollo or any of the Apollo Affiliates, for the
purpose of acquiring, holding, voting or disposing of any Common Stock of
the Company, Apollo and the Apollo Affiliates shall be deemed to have
acquired Apollo Beneficial Ownership of Common Stock Apollo Beneficially
Owned by such person.
(c)-D "Apollo Exempt Person" shall have the meaning set forth in
Section 1(v) hereof."
2. Section 1(v) of the Rights Agreement is amended to read in its entirety
as follows:
"(v) "Exempt Person" shall mean:
(i) collectively, TCW Special Credits, a California
general partnership, The TCW Group, Inc. and their Affiliates, only
so long as TCW Special Credits, a California general partnership,
The TCW Group, Inc. and their Affiliates are, collectively, the
Beneficial Owners of shares of Common Stock outstanding in an
amount not in excess of an aggregate of the higher of (A) 23% of
the shares of Common Stock then outstanding and (B) 4,047,350
<PAGE>
shares of Common Stock, as adjusted for any stock splits, stock
dividends or other recapitalizations of the Company on or after
August 9, 1993;
(ii) collectively, (A) Apollo and the Apollo Affiliates,
only so long as neither Apollo nor any of the Apollo Affiliates is
the Apollo Beneficial Owner of any Prohibited Security and (B) any
person who is an Affiliate of Apollo to the extent that such
Affiliate would be an Acquiring Person as a result of Beneficially
Owning any Permitted Securities;
provided, however, that if (1) any Exempt Person described in clause (ii) of
this Section 1(v) (each an "Apollo Exempt Person") pledges any Permitted
Securities to one or more Permitted Assignees and (2) any such Permitted
Assignee purchases any such Permitted Securities in connection with any
foreclosure proceedings, then (y) each Apollo Exempt Person shall
immediately and automatically cease to be an Exempt Person hereunder and (z)
such Permitted Assignees, collectively, shall be deemed to be an Exempt
Person hereunder, but only so long as none of such Permitted Assignees is
the Apollo Beneficial Owner of any Prohibited Securities."
3. New Sections 1(aa)-A and 1(aa)-B are added to the Rights Agreement
immediately after Section 1(aa) of the Rights Agreement to read in their
entirety as follows:
"(aa)-A "Permitted Assignee" shall mean (a) a commercial bank or
investment bank organized, or any subsidiary, branch or agency of a foreign
commercial bank or investment bank operating, under the laws of the United
States, or any State thereof, and having total assets in excess of
$1,000,000,000; (b) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, and having total
assets in excess of $1,000,000,000; or (c) a finance company, insurance
company or other financial institution organized under the laws of the
United States, or any State thereof, that is engaged in purchasing or
otherwise investing in commercial loans in the ordinary course of business,
having total assets in excess of $100,000,000.
(aa)-B "Permitted Securities" shall mean (a) the Shares (as defined
in the Stock Purchase Agreement); (b) Existing Apollo Shares (as defined in
the Stock Purchase Agreement); (c) the Options (as defined in the Stock
Purchase Agreement) and shares of Common Stock acquired by the exercise of
such Options; (d) that number of shares of Common Stock, which when added to
the number of shares of Common Stock Apollo Beneficially Owned by Apollo and
the Apollo Affiliates under clauses (a), (b) and (c) above, does not exceed
twenty five percent (25%) of the total number of outstanding shares of
Common Stock (determined at the time of any acquisition of Common Stock by
Apollo and the Apollo Affiliates); (e) any securities acquired by Apollo
pursuant to Section 4.4 of the Stock Purchase Agreement, including any
securities received upon exercise, exchange or conversion thereof; (f) any
other shares of Common Stock Apollo Beneficially Owned by Apollo or the
Apollo Affiliates in excess of the total permitted under clauses (a), (b),
(c) and (d) (the "Limit") and without actual knowledge of the fact that such
shares were acquired in excess of the Limit (the "Inadvertent Shares") and
<PAGE>
(g) any non-voting securities of the Company Apollo Beneficially Owned by
Apollo or the Apollo Affiliates that are not exchangeable, exercisable or
convertible into voting securities of the Company; provided, however, that
Inadvertent Shares shall become Prohibited Securities unless disposed of by
Apollo or the Apollo Affiliates, as the case may be, within twenty (20)
Business Days from the time that Apollo or such Apollo Affiliate has actual
knowledge that such Inadvertent Shares are owned in violation of the Limit.
In the event that a Permitted Assignee shall exercise its right to transfer
Permitted Securities to itself, the term "Permitted Securities" as to such
Permitted Assignee shall include other shares of Common Stock Apollo
Beneficially Owned by such Permitted Assignee."
4. A new Section 1(cc)-A is added to the Rights Agreement immediately after
Section 1(cc) of the Rights Agreement to read in its entirety as follows:
"(cc)-A "Prohibited Security" shall mean any share of Common Stock,
which is not a Permitted Security."
5. A new Section 1(ii)-A is added to the Rights Agreement immediately after
Section 1(ii) of the Rights Agreement to read in its entirety as follows:
"(ii)-A "Stock Purchase Agreement" shall mean the Stock Purchase
Agreement dated as of October 10, 1996, as amended and in effect from time
to time, between the Company and Apollo."
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment to
Common Stock Rights Agreement to be duly executed as of the day and year first
above written.
KOGER EQUITY, INC.
By: /s/ W. Lawrence Jenkins
Title: Vice President
Attest:
By: /s/ Mary H. McNeal
Assistant Secretary
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By: /s/ Eleanor G. Autry
Title: Vice President
<PAGE>