EXHIBIT 10.5
STOCKHOLDERS' AGREEMENT
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THIS STOCKHOLDERS' AGREEMENT (this "Agreement") is made as of __________,
1997 by and among DocuCorp., Inc., a Delaware corporation (the "Company"),
Safeguard Scientifics (Delaware), Inc., a Delaware corporation ("Safeguard"),
Technology Leaders II L.P., a Delaware limited partnership ("XX XX"), Technology
Leaders II Offshore C.V., a Netherlands Antilles limited partnership ("XX XX
Offshore," and together with Safeguard and XX XX, the "SG/TL Stockholders"), and
Xerox Corporation, a New York corporation ("Xerox"). The parties to this
Agreement other than the Company are sometimes collectively referred to herein
as the "Stockholders."
Background
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The Company, FormMaker Software, Inc., a Georgia corporation
("FormMaker"), Image Sciences, Inc., a Texas corporation ("Image Sciences"), and
two newly-formed subsidiaries of the Company have entered into an Agreement and
Plan of Merger (the "Merger Agreement") dated January 15, 1997 pursuant to which
the stockholders of FormMaker and Image Sciences will receive, in the case of
FormMaker stockholders, shares of Class A Common Stock, par value $0.01 per
share ("Class A Common Stock"), and in the case of Image Sciences stockholders,
shares of Class B Common Stock of the Company, par value $0.01 per share ("Class
B Common Stock," and together with the Class A Common Stock, "Common Stock").
The parties are entering into this Agreement as contemplated by the Merger
Agreement, and the Agreement will be effective upon the effectiveness of the
Merger contemplated by the Merger Agreement. Terms are used herein as defined in
the Merger Agreement unless otherwise defined herein.
Witnesseth:
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NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other valuable consideration, the parties, intending to be legally
bound, hereby agree as follows:
1. Board of Directors and Bylaws.
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(a) The Stockholders shall vote their respective shares of Common
Stock and any other shares of voting securities of the Company now owned or
hereafter acquired or controlled by them that have the right to vote generally
in election of directors of the Company (collectively, "Voting Stock"), and
otherwise use commercially reasonable efforts as stockholders of the Company, at
all times until the Termination Date (as hereinafter defined) to cause and
maintain the election to the Board of Directors of (i) a total of three
designees of the SG/TL Stockholders, (ii) a total of three designees of Xerox
and (iii) one designee unaffiliated with any of the SG/TL Stockholders or Xerox
who is mutually agreed upon by the other six designees.
(b) Until the Termination Date, (i) the SG/TL Stockholders, as a
group acting by a majority in interest, and Xerox shall each have the right to
remove any of their respective designees to the Board and (ii) in the event of
any vacancy on the Board, the Board shall promptly fill such vacancy, and if
necessary to fill the vacancy promptly, each Stockholder shall vote to fill such
vacancy, in all cases in such a manner as to maintain the number of designees of
each party listed in subparagraph (a) above.
(c) Until the Termination Date, the Company shall not amend its
bylaws, and the Stockholders shall vote their respective Voting Stock and
otherwise use commercially reasonable efforts as stockholders of the Company to
prevent any amendment of the bylaws, unless such amendment shall have been
approved in writing by the SG/TL Stockholders, as a group acting by a majority
in interest, and Xerox.
2. Inspection. The Company shall permit any of the Stockholders, at
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such Stockholder's expense, to visit and inspect the Company's properties, to
examine its books of account and records and to discuss the Company's affairs,
finances and accounts with its officers, all at such reasonable times as may be
requested by such Stockholder.
3. Termination.
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This Agreement, and the respective rights and obligations of the
Stockholders hereto, shall terminate on the date (the "Termination Date") that
is the earlier of (a) the consummation of a Qualified Rights Offering or a
Qualified Public Offering (as defined in the Company's Certificate of
Incorporation), or (b) the 10th anniversary of this Agreement.
4. Notices.
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Any notice, authorization, request or demand required or permitted
to be given hereunder shall be deemed to be given upon the earlier of the
business day when received at, or the third day (or if later, the next following
business day) after the date when sent by certified or registered mail or the
next following business day when sent by Federal Express or other overnight
delivery service to, the address of the Company's principal executive offices in
the case of any notice to the Company, and until changed by notice to the
Company, the respective addresses of the Stockholders on file with the Company
in the case of any notice to the Stockholders.
5. Specific Performance.
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The rights of the Company and the Stockholders under this Agreement
are unique and, accordingly, the Company and the Stockholders shall, in addition
to such other remedies as may be available at law or in equity, have the right
to enforce their respective rights hereunder by actions for specific performance
to the extent permitted by law.
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6. Amendments.
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Except as otherwise expressly provided herein, this Agreement may
not be amended, and any provision of this Agreement may not be waived, except by
an instrument in writing executed by the parties hereto. The Company shall
provide each Shareholder with written notice of any amendment or waiver of this
Agreement.
7. Legends. The certificates representing the Voting Stock subject to
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this Agreement shall bear on their face a legend indicating the restrictions
imposed hereby.
8. General.
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(a) This Agreement shall be construed and enforced in accordance
with the laws of the State of Delaware. Each of the parties hereto irrevocably
submits to the exclusive jurisdiction of any court of competent jurisdiction in
the State of Delaware and the United States District Court for the District of
Delaware and any other court of the State of Delaware and the United States with
jurisdiction to hear appeals from any such court.
(b) The Stockholders and the Company shall execute such documents
and take such further actions, including voting their Voting Stock and, in the
case of the SG/TL Stockholders and Xerox, causing their respective director
designees to vote as members of the Board of Directors or committees thereof as
may be reasonably required or desirable to carry out the provisions hereof and
the transactions contemplated hereby, including taking actions as stockholders
of the Company to cause the Company to comply with the obligations imposed on
the Company under this Agreement.
(c) This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns, as well as
any assignee of the Stockholders' shares of Voting Stock. If any Stockholder
assigns less than all of its Voting Stock, such Stockholder and its assignees
shall have the rights and obligations of the Stockholder hereunder, which rights
and obligations shall be exercised and fulfilled by them in accordance with the
decision of the holders of a majority of interest among the Stockholder and such
assignees, except that in the case of any of the SG/TL Stockholders, such rights
shall be exercised in accordance with the decision of the holders of a majority
in interest among the SG/TL Stockholders and their respective assignees as one
group.
(d) This Agreement, the Merger Agreement and the documents
specified therein contain the entire agreement among the parties hereto
regarding the subject matter thereof, and there are no agreements,
representations or warranties that are not set forth therein. All prior
negotiations, agreements and understandings are superseded hereby.
(e) This Agreement may be executed in two or more counterparts,
each of which shall be binding as of the date hereof. Each such copy shall be
deemed an original, and it
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shall not be necessary in making proof of this Agreement to produce or account
for more than one such counterpart.
(f) If any one or more of the provisions contained in this
Agreement shall for any reason be held invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement and such invalid, illegal and unenforceable
provision shall be reformed and construed to be valid, legal, and enforceable to
the maximum extent permitted by law.
(g) Unless the context of this Agreement clearly requires
otherwise, (i) references to the plural include the singular, and the singular
the plural, (ii) references to one gender include all genders, (iii) "or" has
the inclusive meaning frequently identified with the phrase "and/or,"
(iv) "including" has the inclusive meaning frequently identified with the phrase
"but not limited to" and (v) "hereunder" or "herein" refer to the entire
Agreement. The section and other headings contained in this Agreement are for
reference purposes only and shall not control or affect the construction of this
Agreement or the interpretation thereof in any respect. Section and subsection
references are to this Agreement unless otherwise specified.
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[SIGNATURE PAGE TO STOCKHOLDERS' AGREEMENT]
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
DOCUCORP, INC.
By:
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Name:
Title:
SAFEGUARD SCIENTIFICS
(DELAWARE), INC.
By:
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Name:
Title:
TECHNOLOGY LEADERS II L.P.
By:
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Name:
Title:
TECHNOLOGY LEADERS II OFFSHORE C.V.
By:
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Name:
Title:
XEROX CORPORATION
By:
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Name:
Title:
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