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As filed with the Securities and Exchange Commission on December 3, 1998
Registration No. 333-67277
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
DOCUCORP INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-2690838
(State of incorporation) (I.R.S. employer identification no.)
5910 North Central Expressway, Suite 800
Dallas, Texas 75206
(214) 891-6500
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
---------------------
Todd A. Rognes
Senior Vice President and Chief Financial Officer
DocuCorp International, Inc.
5910 North Central Expressway, Suite 800
Dallas, Texas 75206
(214) 891-6500
(Name, address including zip code, and telephone number, including area
code, of agents for service)
---------------------
COPY TO:
Bruce H. Hallett
Crouch & Hallett, L.L.P.
717 N. Harwood St., Suite 1400
Dallas, Texas 75201
(214) 953-0053
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Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration
Statement.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please check the
following box. / /
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box.
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Title of Each Amount Proposed Maximum Proposed Maximum Amount of
Class of Securities Being Offering Price Aggregate Offering Registration
Being Registered Registered Per Share(1) Price Fee
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<S> <C> <C> <C> <C>
Common Stock, par value
$.01 per share 720,000 shares $4.125 $2,970,000 $876.15
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</TABLE>
(1) Estimated solely for purposes of calculating the amount of the
registration fee pursuant to the provisions of Rule 457(c).
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
<PAGE>
The information in this prospectus is not complete and may be changed. WE
may not sell these securities until the registration statement is effective.
This prospectus is not an offer to sell these securities and we are not
soliciting an offer to buy these securities in any state where the offer or
sale is not permitted.
<PAGE>
SUBJECT TO COMPLETION, DATED DECEMBER 3, 1998
720,000 SHARES
DOCUCORP INTERNATIONAL, INC.
COMMON STOCK
---------------------
Certain of the stockholders of DocuCorp International, Inc., a Delaware
corporation, are offering 720,000 shares of the Company's Common Stock. The
Company will not receive any of the proceeds from the stockholders' sale of
their shares.
YOU SHOULD CAREFULLY CONSIDER THE RISK FACTORS SET FORTH HEREIN. SEE
"RISK FACTORS BEGINNING ON PAGE 3 OF THIS PROSPECTUS."
The last reported sale price of the Common Stock (trading symbol DOCC) on
the Nasdaq National Market on December 2, 1998 was $______ per share.
---------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY
STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE
SECURITIES, OR DETERMINED THAT THIS PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
The date of this Prospectus is December __, 1998.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Where You Can Find More Information. . . . . . . . . . . . . . . . . . . 7
Explanatory Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
About DocuCorp . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Selling Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Description of Capital Stock . . . . . . . . . . . . . . . . . . . . . . 10
Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
-i-
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RISK FACTORS
WE WISH TO CAUTION YOU THAT THE FOLLOWING IMPORTANT FACTORS, AMONG
OTHERS, COULD CAUSE THE ACTUAL RESULTS OF DOCUCORP INTERNATIONAL TO DIFFER
MATERIALLY FROM THOSE INDICATED BY FORWARD-LOOKING STATEMENTS MADE FROM TIME
TO TIME IN NEWS RELEASES, REPORTS, PROXY STATEMENTS, REGISTRATION STATEMENTS
AND OTHER WRITTEN COMMUNICATIONS, AS WELL AS ORAL FORWARD-LOOKING STATEMENTS
MADE FROM TIME TO TIME BY REPRESENTATIVES OF THE COMPANY. EXCEPT FOR
HISTORICAL INFORMATION, THE MATTERS DISCUSSED IN SUCH ORAL AND WRITTEN
COMMUNICATIONS ARE FORWARD- LOOKING STATEMENTS THAT INVOLVE RISKS AND
UNCERTAINTIES, INCLUDING BUT NOT LIMITED TO GENERAL BUSINESS CONDITIONS AND
THE IMPACT OF COMPETITION AND OTHER RISKS DETAILED BELOW.
SIGNIFICANT REVENUES FROM TWO INDUSTRIES INCREASES DEPENDENCE ON THOSE
INDUSTRIES
Approximately 73% of our total revenues for the year ended July 31, 1998
and 70% of our pro forma total revenues for the year ended July 31, 1997 were
derived from the insurance industry. Of these revenues, 13% and 21% of total
revenues in fiscal 1998 and 1997 (on a pro forma basis), respectively, were
derived from one customer, Prudential Insurance Company of America.
Additionally, approximately 20% and 9% of our total revenues for the year
ended July 31, 1998 and 1997 (on a pro forma basis), respectively, were
derived from the utilities industry. Our continued financial performance and
our future growth will depend upon our ability to continue to market our
products successfully in the insurance and utilities industries and to
enhance and market technologies for distribution in other markets. This will
require us to make substantial product development and distribution channel
investments. We cannot assure you that the Company will be able to continue
marketing its products successfully in the insurance and utilities industries
or will be able to introduce successfully new or existing products in markets
other than the insurance and utilities industries. In addition, we cannot
assure you that the Company will continue to sell products and services to
Prudential Insurance Company of America at historical levels. Any significant
decline in revenues derived from Prudential Insurance Company of America
could have a material adverse effect on the Company's results of operations.
RAPID TECHNOLOGICAL ADVANCES MAY EFFECT COMPANY'S BUSINESS
The document automation industry has experienced rapid technological
advances as a result of continued advancements in software technology and
hardware capability. These advancements have in turn raised the expectations
of customers regarding our products. Any failure by the Company to
anticipate or respond adequately to technological developments and customer
requirements, or any significant delays in product development or
introduction, could have a material adverse effect on the Company's results
of operations. We cannot assure you that the Company's new products or
product enhancements intended to respond to technological change or evolving
customer requirements will achieve acceptance.
SIGNIFICANT THIRD-PARTY DISTRIBUTOR RELATIONSHIP MAY ADVERSELY AFFECT
REVENUES
FormMaker Software, Inc., which was acquired by the Company in
connection with the merger, historically distributed its line of Document
Automation Platform software products to the insurance industry in North
America through a marketing agreement with Policy Management Systems
Corporation. A substantial portion of the subsidiary's revenues have
historically been generated pursuant to this agreement. Additionally, the
subsidiary had granted Policy Management Systems Corporation the exclusive
right to market the Document Automation Platform software in the
property/casualty and life insurance industries. Revenues from Policy
Management Systems Corporation under this agreement for the year ended July
31, 1998 and 1997 (on a pro forma basis) were $5.5 million and $10.3 million,
respectively. Subsequent to year end, both parties agreed to terminate the
exclusive marketing agreement and enter into a new non-exclusive
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marketing agreement. The new marketing agreement between us and Policy
Management Systems Corporation allows Policy Management Systems Corporation
to market all of our software products to insurance and financial services
companies worldwide.
Policy Management Systems Corporation also terminated a print
outsourcing agreement, effective May 1998. Revenues from Policy Management
Systems Corporation under the print outsourcing agreement for the year ended
July 31, 1998 and 1997 (on a pro forma basis) were $4.4 million and $5.3
million, respectively. Accordingly, print outsourcing revenues are expected
to decline from fiscal year 1998 levels until we are able to replace this
business with new business.
Policy Management Systems Corporation also had a non-exclusive,
perpetual, royalty-free, worldwide license to use, execute, copy or license
the Document Automation Platform software (and derivations thereof) to
third-parties. This license was terminated upon execution of the new
non-exclusive marketing agreement.
ATTRACTION AND RETENTION OF TECHNICAL EMPLOYEES MAY BECOME DIFFICULT
We believe that our future success will depend in large part upon our
ability to attract, retain and motivate highly skilled employees,
particularly technical employees. The employees that are in highest demand
are software programmers, software developers, application integrators and
information technology consultants. Because of continued growth of high
technology business, these employees are likely to remain a limited resource
for the foreseeable future. We cannot assure you that the Company will be
able to attract and retain sufficient numbers of highly skilled technical
employees. The loss of a significant number of our technical employees could
have a material adverse effect on the Company.
YEAR 2000 COMPLIANCE MAY PRESENT UNCERTAINTIES
We recognize the need to ensure that our operations will not be
adversely impacted by Year 2000 software failures. Accordingly, we have been
evaluating the impact of the Year 2000 on our product line and services
offerings, as well as our internal systems and hardware. Relative to our
product line, all current versions of our products are designed to be "Year
2000" compliant. Customers using pre-Year 2000 compliant versions of our
software products are entitled to receive upgraded Year 2000 compliant
software as part of their software support agreements with us, as long as the
customer support agreements remain in force. We are in the process of
determining the extent to which our services implementations are Year 2000
compliant. To the extent we are directly involved in resolving any
non-compliant services implementations, generally the customer will be
responsible for the fees associated with such services. Accordingly, we do
not currently believe that the effects of any Year 2000 non-compliance in our
installed base of products or services offerings will result in any material
adverse impact on our business or financial condition. We cannot assure you
that the Company will not be exposed to potential claims resulting from
system problems associated with the century change.
As to our own internal software systems and hardware, the Company has
identified and is currently reviewing all key areas. We believe there is no
significant exposure to us related to the Year 2000 issue and that the
majority of identified non-compliant systems are planned to be upgraded as
part of our normal upgrade process within the next 12 months. The cost of
upgrading or replacing other non-compliant hardware and software is not
expected to be material.
INTENSE COMPETITION FOR THE SALE OF DOCUMENT AUTOMATION PRODUCTS
The market for our document automation products is intensely
competitive. We face competition from a broad range of competitors, many of
whom have greater financial, technical and marketing resources than the
Company. The Company's principal competition currently comes from systems
developed in-house by the internal MIS departments of large organizations and
direct
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competition from numerous software vendors, including Cincom Systems, Inc.,
Document Sciences Corporation (which is majority owned by Xerox Corporation),
Group 1 Software, Inc., Mobius Management Systems, Inc., and M&I Data
Services. We cannot assure you that the Company will be able to compete
effectively with such entities.
COMPANY HAS EXPERIENCED FLUCTUATIONS IN OPERATING RESULTS
We have experienced and may in the future continue to experience
fluctuations in our quarterly operating results due to the fact that sales
cycles, from initial evaluation to purchase, vary substantially from customer
to customer. Delays in the sales cycle frequently occur because our
customers' purchasing decision are influenced by our competition, changes in
customer personnel, and our customers' budgets and spending priorities. We
have typically operated with little backlog for license revenues because
software products generally are shipped soon after orders are received. As a
result, license revenues in any quarter are substantially dependent on orders
booked and shipped in that quarter. The delay of customer orders for a small
number of licenses could adversely affect our license revenues for a given
fiscal quarter. We have historically earned a substantial portion of our
license revenues in the last weeks of any particular quarter, and have
historically experienced our highest license revenues in the fourth quarter
of our fiscal year. The failure to achieve such revenues in accordance with
such trends could have a material adverse effect on the Company's financial
results for each such interim period.
RISK OF SOFTWARE DEFECTS IS INHERENT IN COMPANY'S BUSINESS
Complex software products such as those offered by us can contain
undetected errors or performance problems. Such defects are most frequently
found during the period immediately following introduction of new products or
enhancements to existing products. Our products have from time to time
contained software errors that were discovered after commercial introduction.
We cannot assure you that performance problems or errors will not be
discovered in the Company's products in the future. Any future software
defects discovered after shipment of our products, if material, could result
in loss of revenues, delays in customer acceptance or potential product
liability.
LIMITED PROTECTION OF INTELLECTUAL PROPERTY RIGHTS
We rely on the enforcement of copyright and trademark laws and employee
and third-party nondisclosure agreements, and other methods to protect our
proprietary intellectual property rights. Despite these precautions, it may
be possible for unauthorized third-parties to copy certain portions of our
products or to obtain and use information that we regard as proprietary. We
cannot assure you that the Company's efforts will provide meaningful
protection for our proprietary technology against others who independently
develop or otherwise acquire substantially equivalent techniques or gain
access to, misappropriate or disclose our proprietary technology.
DEPENDENCE ON SINGLE FACILITY FOR COMPANY'S PRINT OUTSOURCING SERVICES
Our print outsourcing operations are performed at our facility in
Atlanta, Georgia. Since the Company only has the capability to perform this
function at a single location, a fire, flood, earthquake, power loss or other
event affecting the Company's Atlanta processing and print facility could
cause a significant interruption in our operations. We cannot assure you
that the Company's contingency plans in the event of such interruption will
prove to be adequate. Any interruption in the operations at the Company's
Atlanta processing and print facility could have a material adverse effect on
the Company's business, financial condition or results of operations.
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INTEGRATION OF OPERATING SUBSIDIARIES IS NOT COMPLETED
FormMaker Software, Inc. and Image Sciences, Inc. completed the merger
whereby the Company came to be formed in fiscal 1997. The Company completed
the acquisitions of EZPower Systems, Inc. and Maitland Software,
Inc. in March 1998 and subsequently commenced the integration of their
operations, facilities and management. We expect to continue substantial
integration of the respective products and services of the aforementioned
entities throughout fiscal 1999. We may not be able to complete this
integration successfully. Additionally, the merger and recent acquisitions
could have a material adverse effect on our relationships with customers,
distributors or suppliers. The operating history of our subsidiaries on a
stand-alone basis cannot necessarily be regarded as indicative of our
prospects on a consolidated basis. Accordingly, we cannot assure you that the
Company will achieve growth in revenues, or sustain revenues at a level
consistent with the historical results of its subsidiaries on a stand-alone
basis.
DEPENDENCE ON KEY MANAGEMENT PERSONNEL
We believe that our continued success depends to a significant extent
upon the efforts and abilities of our senior management. In particular, the
loss of Michael D. Andereck, the Company's President and Chief Executive
Officer, or any of our other executive officers or senior managers could have
a material adverse effect on the Company.
6
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WHERE YOU CAN FIND MORE INFORMATION
We file reports and other information with the SEC. You may inspect and
copy reports, proxy statements and other information concerning the Company at
the public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549; 7 World Trade Center, Suite 1300, New
York, New York 10048; and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. You may obtain copies of such material from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. You may also obtain certain reports, proxy
statements and other information filed by the Company at the Commission's
World Wide Web site, located at http://www.sec.gov. In addition, you can
inspect such material at the offices of the Nasdaq Stock Market, Inc., 1735 K
Street, N.W., Washington, D.C. 20006. Additionally, you may access all of
the Company's filings with the SEC online at the Company's web site located
at www.docucorp.com.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference
is considered to be part of this prospectus, and later information that we
file with the SEC will automatically update and supersede this information.
We incorporate by reference the documents listed below and any future filings
made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the selling stockholders sell all the shares.
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED JULY 31, 1998.
We will provide you without charge upon your written or oral request, a
copy of the documents incorporated by reference herein, other than exhibits
to such documents not specifically incorporated by reference. Please direct
such requests to DocuCorp International, Inc., 5910 N. Central Expressway,
Suite 800, Dallas, Texas 75206, Attention: Todd A. Rognes (telephone
214-891-6500).
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. The selling stockholders
will not make an offer of these shares in any state where the offer is not
permitted. You should not assume that the information in this prospectus or
any supplement is accurate as of any date other than the date on the front of
those documents.
EXPLANATORY NOTE
Statements and information presented within this Prospectus contain
"forward-looking statements" within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements can be identified by the use of predictive, future-tense or
forward-looking terminology, such as "believes," "anticipates," "expects,"
"estimates," "may," "will" or similar terms. Forward-looking statements also
include projections of financial performance, statements regarding
management's plans and objectives and statements concerning any assumptions
relating to the foregoing. Certain important factors which may cause actual
results to vary materially from these forward-looking statements accompany
such statements and appear elsewhere in this Prospectus under "Risk Factors".
All subsequent written or oral forward-looking statements attributable to
the Company or persons acting on its behalf are expressly qualified by these
factors.
7
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ABOUT DOCUCORP
DocuCorp develops, markets and supports a portfolio of open-architecture,
enterprise-wide document automation software products that enable its
customers to produce complex, high volume, individualized documents. In
addition, the Company provides document automation consulting, systems
integration and document processing and printing services through a
170-person service organization. Document processing and printing services
utilize the Company's software to provide solutions for handling high volume,
complex print, finish and mailing for customers who outsource this activity.
DocuCorp software products support leading hardware platforms, operating
systems, printers and imaging systems. These products are designed to create,
publish and store documents such as insurance policies, utility statements,
telephone bills, bank and mutual fund statements, invoices, direct mail
correspondence, bills of lading and other customer oriented documents. The
Company currently has an installed base of approximately 800 customers. We
believe that we are the leading provider of document automation software and
services for the insurance industry. Our key customers include Prudential
Insurance Company of America, Continental National Assurance and American
International Group. More than half of the 200 largest insurance companies
in North America use our software products and services, including seven of
the ten largest life and health insurance companies and nine of the ten
largest property and casualty insurance companies. We believe that we have
also become a leading provider of document automation software and services
for companies in the utilities industry, and that most of the recent
adoptions of automated customer billing software were licenses of the
Company's products. Our key utilities customers include Southern Company
Services, Inc. and Consolidated Edison of New York, Inc. We also have
customers in the financial services, higher education, telecommunications and
transportation industries, including Royal Bank Financial Group, The
University of Texas, Polkomtel S.A. and Yellow Technology Services, Inc.
Document automation is becoming increasingly important to corporations
as they endeavor to grow revenue, improve customer service and reduce costs.
Furthermore, certain current trends such as deregulation and consolidation in
industries such as insurance, utilities and financial services and increased
computing power have accelerated the growth of the document automation
industry.
DocuCorp was organized and incorporated in Delaware in January 1997 in
connection with the merger of FormMaker Software, Inc. and Image Sciences,
Inc., which was consummated on May 15, 1997. Prior to the merger, Image
Sciences and FormMaker had been engaged in the document automation software
and services industry since 1982 and 1983, respectively. Our principal
executive offices are located at 5910 North Central Expressway, Suite 800,
Dallas, Texas 75206, and our telephone number is 214-891-6500.
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SELLING STOCKHOLDERS
The table below sets forth the beneficial ownership of the Company's
Common Stock by the selling stockholders at November 12, 1998, and after
giving effect to the sale of the shares of Common Stock offered hereby. All
of the selling stockholders acquired the shares of Common Stock owned by them
pursuant to the Company's acquisition of EZPower Systems or Maitland
Software. Except as indicated otherwise, each of the persons named below has
sole voting and investment power with respect to the shares of Common Stock
beneficially owned by him or her. Unless otherwise indicated, the share
numbers in the table below represent 1% or less of the outstanding Common
Stock of the Company.
<TABLE>
<CAPTION>
Shares Owned Shares Owned
Before the Shares Being After the
Name Offering Offered Offering (1)
- ---- ------------ ------------ ------------
<S> <C> <C> <C>
Sashidhar P. Reddi(2) 179,465 179,465 ---
Subinder Khurana(3) 87,901 87,901 ---
Michael C. Row(4) 60,711 60,711 ---
Dr. G. V. Reddy 38,457 38,457 ---
Dr. Swarna Kirshnasamy 3,663 3,663 ---
Prasanth G. Reddy 3,663 3,663 ---
Neel G. Reddy 5,494 5,494 ---
Anam Anish Reddy 458 458 ---
P. Ashok Reddy 549 549 ---
Saranya Reddy 549 549 ---
Ashwin Ashok 732 732 ---
Sheena Ashok 732 732 ---
Shankar Bhatta 1,099 1,099 ---
Syed Manzur Elahi 9,106 9,106 ---
Munize Manzur 8,013 8,013 ---
Dikran Hovamigian 1,831 1,831 ---
John Iwasz 366 366 ---
Sandipan Sharma 769 769 ---
John Smith 3,663 3,663 ---
Matt Timmins 440 440 ---
Michael Weiss 610 610 ---
Digistar Investments(5) 238,066 238,066 ---
Zingero Establishment 3,663 3,663 ---
James S. Gentsch 85,000 35,000 50,000
David T. Rourke 85,000 35,000 50,000
</TABLE>
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- -----------------
(1) Assumes that all of the shares offered hereby are sold.
(2) Subsequent to the acquisition of EZPower Systems, Mr. Reddi has served as
Senior Vice President, Business Development of the Company. Mr. Reddi has
contractually agreed not to sell more than 119,644 of his shares prior to
February 1, 2000. Mr. Reddi's shares owned before the Offering constitute
1.1% of the outstanding Common Stock.
(3) Mr. Khurana has contractually agreed not to sell more than 58,600 of his
shares prior to February 1, 2000.
(4) Mr. Row has contractually agreed not to sell more than 40,474 of his shares
prior to February 1, 2000.
(5) Digistar Investments' shares owned before the Offering constitute 1.5% of
the outstanding Common Stock.
The Company is registering the shares of the selling stockholders
pursuant to certain registration rights granted to them pursuant to
agreements entered in connection with the EZPower Systems and Maitland
Software acquisitions. The offering of the shares contemplated hereby will
terminate on March 31, 2000.
PLAN OF DISTRIBUTION
The selling stockholders may offer the shares from time to time in open
market transactions (which may include block transactions) or otherwise in
the over-the-counter market through the Nasdaq National Market, or in private
transactions at prices relating to prevailing market prices or at negotiated
prices. The selling stockholders may effect such transactions by selling the
shares to or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions or commissions from the
selling stockholders and/or purchasers of the shares for whom such
broker/dealers may act as agent or to whom they sell as principal or both
(which compensation as to a particular broker/dealer might be in excess of
customary commissions). The selling stockholders and any broker/dealer
acting in connection with the sale of the shares offered hereby may be deemed
to be "underwriters" within the meaning of the Securities Act of 1933, as
amended, in which event any discounts, concessions or commissions received by
them, which are not expected to exceed those customary in the types of
transactions involved, or any profit on resales of the shares by them, may be
deemed to be underwriting commissions or discounts under the 1933 Act. The
offering of the shares will terminate upon the earlier to occur of the sale
of all the shares and March 31, 2000. The selling stockholders acquired
their shares pursuant to the Company's acquisition in March 1998 of EZPower
Systems, Inc. and Maitland Software, Inc.
The Company will pay the costs, expenses and fees incurred in connection
with the registration of the shares, which are estimated to be $23,000
(excluding selling commissions and brokerage fees incurred by the selling
stockholders). The Company has also agreed to indemnify certain of the
selling stockholders against certain liabilities, including liabilities under
the 1933 Act.
DESCRIPTION OF CAPITAL STOCK
The Company is authorized to issue 58,000,000 shares consisting of
50,000,000 shares of Common Stock, par value $0.01 per share, 7,000,000
shares of Class B common stock, par value $0.01 per share, and 1,000,000
shares of Preferred Stock, par value $0.10 per share. As of the close of
business on November 12, 1998, approximately 16,179,958 shares of Common
Stock were outstanding and no shares of Class B common stock or Preferred
Stock were outstanding. The Company does not intend to issue any more Class
B common stock.
COMMON STOCK
Holders of Common Stock are entitled to one vote per share on any matter
submitted to the vote of stockholders, and cumulative voting is prohibited in
the election of directors. Amendments to the Company's Certificate of
Incorporation require the approval of the holders of a majority of the Common
Stock. Except as otherwise required by law and as may be required by the
terms of the Preferred Stock, all other matters are determined by a majority
of the votes cast. The holders of Common Stock are entitled to receive
dividends when, as and if declared by the Company's Board of Directors out of
funds legally available for the payment thereof, subject to any preferential
dividend rights of outstanding Preferred Stock. The shares of Common Stock
that will be outstanding upon the consummation of the offering will be, when
issued and paid for, fully paid and nonassessable. The rights, preferences
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and privileges of holders of Common Stock are subject to, and may be
adversely affected by, the rights of the holders of shares of any series of
Preferred Stock which the Company may designate and issue in the future.
Holders of Common Stock do not have any preemptive or subscription rights or
any redemption or conversion rights.
PREFERRED STOCK
DocuCorp has authorized 1,000,000 shares of Preferred Stock which the
Company's Board has discretion to issue in such series and with such
preferences and rights as it may designate without the approval of the
holders of Common Stock. Such preferences and rights may be superior to
those of the holders of Common Stock. For example, the holders of Preferred
Stock may be given a preference in payment upon liquidation of DocuCorp, or
for the payment or accumulation of dividends before any distributions are
made to the holders of Common Stock. As of the date of this Prospectus, no
Preferred Stock has been designated or issued by the Company, and the Company
has no plans, agreements or understandings for the issuance of Preferred
Stock.
The Transfer Agent and Registrar for the Common Stock is Securities
Transfer Corporation, 16910 Dallas Parkway, Suite 100, Dallas, Texas 75248.
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<PAGE>
LEGAL OPINIONS
Crouch & Hallett, L.L.P., Dallas, Texas has opined as to the validity of
the shares of Common Stock being offered hereby.
EXPERTS
The audited historical financial statements incorporated in this
Prospectus by reference to the Annual Report on Form 10-K of DocuCorp
International, Inc. for the year ended July 31, 1998 have been so
incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
12
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following expenses will be paid by the Company:
<TABLE>
<CAPTION>
Item Amount (1)
- ---- ----------
<S> <C>
SEC registration fee $ 876
Nasdaq listing fee 14,400
Legal fees and expenses 2,500
Accounting fees 3,500
Miscellaneous 1,724
-------
Total $23,000
-------
-------
</TABLE>
- --------------
(1) All items other than SEC registration fee and Nasdaq listing fee are
estimated.
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Certificate of Incorporation of the Company limits or eliminates the
liability of the Company's directors or officers to the Company or its
stockholders for monetary damages to the fullest extent permitted by the
Delaware General Corporation Law, as amended (the "DGCL"). The DGCL provides
that a director of DocuCorp shall not be personally liable to DocuCorp or its
stockholders for monetary damages for a breach of fiduciary duty as a
director, except for liability: (i) for any breach of such person's duty of
loyalty; (ii) for acts or omissions not in good faith or involving
intentional misconduct or a knowing violation of law; (iii) for the payment
of unlawful dividends and certain other actions prohibited by Delaware
corporate law; and (iv) for any transaction resulting in receipt by such
person of an improper personal benefit.
DocuCorp has directors' and officers' liability insurance to provide its
directors and officers and the directors and officers of FormMaker and Image
Sciences with insurance coverage for losses arising from claims based on
breaches of duty, negligence, error and other wrongful acts.
Item 16. EXHIBITS.
<TABLE>
<S> <C>
2.1 --- Agreement and Plan of Merger, among the registrant, DocuCorp
International, Inc., EZPS Acquisition Corp., EZPower Systems, Inc.,
and the stockholders of EZPower Systems, Inc. (1)
2.2 --- Stock Purchase Agreement, among the registrant, DocuCorp
International, Inc., Maitland Software, Inc., David T. Rourke, and
James S. Gentsch. (1)
3.1 --- Certificate of Incorporation of the registrant. (2)
5.1 --- Opinion of Crouch & Hallett, L.L.P. (1)
23.1 --- Consent of PricewaterhouseCoopers LLP, independent accountants. (3)
23.2 --- Consent of Crouch & Hallett, L.L.P. (included in opinion filed as
Exhibit 5.1).
24 --- Power of Attorney.
</TABLE>
- --------------
(1) * Previously filed.
(2) Filed as an exhibit to Registration Statement No. 333-22225 on Form S-4
and incorporated herein by reference.
(3) Filed herewith.
II-1
<PAGE>
Item 17. UNDERTAKINGS.
(a) RULE 415 OFFERING
The registrant hereby undertakes (1) to file, during any period in
which offers or sales are being made of the shares registered hereby, a
post-effective amendment to this Registration Statement to include any
material information with respect to the plan of distribution not
previously disclosed in this Registration Statement or any material change
to such information in this Registration Statement; (2) that, for the
purpose of determining any liability under the Securities Act of 1933, each
such post-effective amendment shall be deemed to be a new Registration
Statement relating to the securities offered herein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof; and (3) to remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE
The registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to
the securities offered herein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(c) INDEMNIFICATION FOR LIABILITY UNDER THE SECURITIES ACT OF 1934
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer, or controlling person of the
registrant in the successful defense of any action, suit, or proceeding)
is asserted by such director, officer, or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Dallas and State
of Texas on the 3rd day of December, 1998.
DOCUCORP INTERNATIONAL, INC.
By /s/ Todd A. Rognes
-----------------------------------------
Todd A. Rognes, Senior Vice President
and Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on December 3, 1998.
<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
/s/ Michael D. Andereck President and Chief Executive Officer
- ------------------------- and Director
Michael D. Andereck (PRINCIPAL EXECUTIVE OFFICER)
/s/ Todd A. Rognes Senior Vice President, Finance
- -------------------------- (PRINCIPAL FINANCIAL OFFICER AND ACCOUNTING OFFICER)
Todd A. Rognes
/s/ Milledge A. Hart, III* Chairman of the Board
- --------------------------
Milledge A. Hart, III
/s/ Anshoo S. Gupta * Director
- --------------------------
Anshoo S. Gupta
Director
- --------------------------
John D. Loewenberg
II-3
<PAGE>
/s/ Warren V. Musser* Director
- --------------------------
Warren V. Musser
/s/ George F. Raymond* Director
- --------------------------
George F. Raymond
/s/ Arthur R. Spector* Director
- --------------------------
Arthur R. Spector
* By /s/ Michael D. Andereck Attorney-in-Fact
- ----------------------------
Michael D. Andereck
</TABLE>
II-4
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated September 9, 1998 which appears on page 21 of the 1998 Annual Report to
Stockholders of DocuCorp International, Inc., which is incorporated by
reference in DocuCorp International, Inc.'s Annual Report on Form 10-K for
the year ended July 31, 1998. We also consent to the incorporation by
reference of our report on the Financial Statement Schedule, which appears in
Form 10-K. We also consent to the references to us under the heading
"Experts" in such Prospectus.
/s/ PricewaterhouseCoopers LLP
December 1, 1998
