Tyler Technologies Inc – ‘DEFM14A’ on 1/21/98

As of:  Wednesday, 1/21/98   ·   Accession #:  950134-98-416   ·   File #:  1-10485

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Definitive Proxy Solicitation Material — Merger or Acquisition   —   Schedule 14A
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: DEFM14A     Definitive Merger Proxy                              193   1.17M 

Document Table of Contents

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SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT 

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES 

   EXCHANGE ACT OF 1934 (AMENDMENT NO.     )

Filed by the Registrant [X]                                           
Filed by a Party other than the Registrant [ ]                        
Check the appropriate box:                                            
[ ] Preliminary Proxy Statement       [ ] Confidential, for Use of the
                                              Commission Only (as permitted by
                               Rule 14a-6(e)(2))

[X] Definitive Proxy Statement                                        

[ ] Definitive Additional Materials                                   

   [ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12

TYLER CORPORATION 
--------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):                              
[ ] No fee required.                                                  
[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.                                                         

(1) Title of each class of securities to which transaction applies:   
Common Stock, $.01 par value
--------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:      
12,000,000
--------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed  
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):                                 
$5.28125, average of reported high and low prices on 11/7/97
--------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:                  
$95,125,000 
--------------------------------------------------------------------------------
(5) Total fee paid:                                                   
$19,025 
--------------------------------------------------------------------------------

[X] Fee paid previously with preliminary materials.                   
--------------------------------------------------------------------------------

    [ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid   
previously. Identify the previous filing by registration statement number, or   
the Form or Schedule and the date of its filing.                                

(1) Amount Previously Paid:                                           

--------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:                     

--------------------------------------------------------------------------------
(3) Filing Party:                                                     

--------------------------------------------------------------------------------
(4) Date Filed:                                                       

--------------------------------------------------------------------------------

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(LOGO)                                                                          

                                                                January 21, 1998

Dear Stockholder:                                                               

    You are cordially invited to attend a special meeting of stockholders (the
"Special Meeting") of Tyler Corporation (the "Company") to be held on Thursday, 
February 19, 1998, at San Jacinto Tower, Suite 2820, 2121 San Jacinto Street,   
Dallas, Texas, commencing at 11:00 a.m.                                         

  The Company has entered into agreements for the acquisitions of Business
Resources Corporation, a Texas corporation (referred to herein as "Resources"), 
and The Software Group, Inc., a Texas corporation (referred to herein as "TSG").
In connection with these acquisitions, at the Special Meeting the stockholders  
of the Company will be asked to consider and vote upon (i) the proposed         
acquisition of Resources through a merger with a newly formed and wholly owned  
subsidiary of the Company, (ii) the proposed acquisition of TSG through a merger
with a newly formed and wholly owned subsidiary of the Company, and (iii) a     
proposed amendment to the Company's Restated Certificate of Incorporation to    
increase the number of authorized shares of Common Stock, $.01 par value per    
share, of the Company from 50,000,000 to 100,000,000 shares. The acquisitions of
Resources and TSG are subject to a number of conditions, including approval by  
the stockholders of the Company.                                                

     Details of the proposed acquisitions, the respective merger agreements, the
amendment to the Company's Certificate of Incorporation, and other important and
related information are set forth in the accompanying Notice of Special Meeting 
and the Proxy Statement. In view of the importance of these matters, please read
carefully the enclosed materials.                                               

    The Board of Directors of the Company has unanimously approved the matters
to come before the Special Meeting and recommends that you vote for their       
approval.                                                                       

It is important that your shares be represented at the Special Meeting
whether or not you plan to attend. I urge you to mark, date, and sign the       
enclosed proxy and return it in the enclosed postage pre-paid envelope as soon  
as possible. If you attend the Special Meeting, you may revoke the proxy and    
vote in person if you so desire, even if you have previously returned your      
proxy. Your prompt cooperation will be greatly appreciated.                     

                         Yours very truly,

                           /s/ LOUIS A. WATERS

                       LOUIS A. WATERS

                             Chairman of the Board

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TYLER CORPORATION 

------------------

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS 

TO BE HELD FEBRUARY 19, 1998

------------------

To the Stockholders of                                                          
TYLER CORPORATION:                                                              

Tyler Corporation (the "Company") will hold a special meeting of      
stockholders (the "Special Meeting") on Thursday, February 19, 1998, at San     
Jacinto Tower, Suite 2820, 2121 San Jacinto Street, Dallas, Texas, commencing at
11:00 a.m., Dallas, Texas time, for the following purposes:                     

          (1) To consider and vote upon a proposal to approve and adopt a Second
  Amended and Restated Agreement and Plan of Merger (the "Resources Merger
    Agreement"), dated as of December 29, 1997, and effective as of October 8,
   1997, among the Company, T1 Acquisition Corporation, a newly formed Texas
 corporation and wholly owned subsidiary of the Company ("T1"), Business
Resources Corporation, a Texas corporation (referred to herein as     
 "Resources"), and William D. Oates, pursuant to which Resources will be
     merged with and into T1, which will be the surviving corporation ("Proposal
No. 1);                                                               

    (2) To consider and vote upon a proposal to approve and adopt an
Amended and Restated Agreement and Plan of Merger (the "TSG Merger    
    Agreement"), dated as of December 29, 1997, and effective as of October 8,
   1997, among the Company, T2 Acquisition Corporation, a newly formed Texas
     corporation and wholly owned subsidiary of the Company ("T2"), The Software
  Group, Inc., a Texas corporation (referred to herein as "TSG"), Glenn A.
 Smith, and Brian B. Berry, pursuant to which T2 will be merged with and
     into TSG, which will be the surviving corporation and become a wholly owned
subsidiary of the Company ("Proposal No. 2");                         

       (3) To consider and vote upon a proposed amendment to the Company's
    Restated Certificate of Incorporation to increase the number of authorized
   shares of Common Stock, $.01 par value per share, of the Company ("Common
  Stock") from 50,000,000 shares to 100,000,000 shares ("Proposal No. 3");
and                                                                   

       (4) To transact such other business as may properly come before the
meeting or any postponements or adjournments thereof.                 

     The Board of Directors of the Company has unanimously approved Proposal No.
1, Proposal No. 2, and Proposal No. 3. Accordingly, the Board of Directors      
unanimously recommends that you vote FOR approval of each of the proposals.     
Information concerning each of the proposals is set forth in the accompanying   
Proxy Statement.                                                                

Approval of Proposal No. 1 and Proposal No. 2 will each require the   
affirmative vote of a majority of votes cast at the Special Meeting, provided   
that the total votes cast represent over 50% in interest of the shares issued   
and outstanding and entitled to vote thereon at the Special Meeting. Approval of
Proposal No. 3 will require the affirmative vote of the holders of record of a  
majority of the shares of the Common Stock issued and outstanding and entitled  
to vote thereon at the Special Meeting. Consummation of each of the Resources   
Merger Agreement and the TSG Merger Agreement is conditioned upon consummation  
of the other. If the stockholders do not approve both of the transactions,      
neither transaction will be consummated and each of the merger agreements will  
be terminated unless consummation of the other transaction is waived by the     
appropriate party or parties.                                                   

  Only stockholders of record at the close of business on January 16, 1998
are entitled to notice of, and to vote at, the Special Meeting or any           
postponements or adjournments thereof. A list of stockholders entitled to vote  
at the Special Meeting will be available for examination at the offices of Tyler
Corporation, 2121 San Jacinto Street, Suite 3200, Dallas, Texas, during regular 
business hours for ten days before the Special Meeting.                         

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   WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE MARK, DATE,
AND SIGN THE ENCLOSED PROXY, WHICH IS SOLICITED BY THE BOARD OF DIRECTORS OF THE
COMPANY, AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE. No postage is required  
if the proxy is mailed in the United States. Prompt response by our stockholders
will reduce the time and expense of solicitation. You may revoke the proxy at   
any time before the proxy is exercised by delivering written notice of          
revocation to the Secretary of the Company, by delivering a subsequently dated  
proxy, or by attending the Special Meeting, withdrawing the proxy, and voting   
your shares personally.                                                         

                                           By Order of the Board of Directors,

                            /s/ JAMES E. RUSSELL

                        JAMES E. RUSSELL

                 Secretary

Dallas, Texas                                                                   

January 21, 1998                                                                

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TYLER CORPORATION 
PROXY STATEMENT 

TABLE OF CONTENTS 

                                                                [Download Table]
                                                                 
GENERAL INFORMATION.........................................    1
  General...................................................    1
  Outstanding Capital Stock.................................    1
  Quorum and Voting.........................................    1
  Action to be Taken at the Meeting.........................    2
  Recommendations of the Tyler Board........................    3
  Persons Making the Solicitation...........................    3
  Forward-Looking Statements................................    3
THE COMPANY.................................................    4
RECENT DEVELOPMENTS.........................................    5
SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA............    6
  The Company--Historical and Pro Forma Financial Data......    6
  Resources--Historical Financial Data......................    7
  TSG--Historical Financial Data............................    8
COMPARATIVE DATA............................................    9
THE ACQUISITIONS (PROPOSAL NO. 1 AND PROPOSAL NO. 2)........   11
  General...................................................   11
  Background of the Acquisitions............................   11
  Reasons for the Acquisitions; Recommendation of the Tyler      
     Board..................................................   14
  Terms of the Acquisitions.................................   17
  Acquisition Financing.....................................   24
  HSR Act...................................................   24
  Limitations on Transferability of Common Stock............   24
  Accounting Treatment......................................   25
  Federal Income Tax Consequences...........................   25
  No Appraisal Rights.......................................   26
  Comparison of Rights of Holders of Stock..................   26
MARKET PRICES AND DIVIDENDS.................................   27
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL             
  STATEMENTS................................................   28
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION      
  AND RESULTS OF OPERATIONS OF RESOURCES....................   36
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION      
  AND RESULTS OF OPERATIONS OF TSG..........................   40
INFORMATION CONCERNING RESOURCES AND TSG....................   42
  Overview..................................................   42
  Resources.................................................   42
  TSG.......................................................   46
MANAGEMENT..................................................   50
  The Company...............................................   50
  New Resources.............................................   51
  TSG.......................................................   52
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT      
  OF THE COMPANY............................................   53
INTERESTS OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON....   55

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AMENDMENT TO THE CHARTER (PROPOSAL NO. 3)...................   57               
ACCOUNTANTS.................................................   58               
STOCKHOLDER PROPOSALS.......................................   58               
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE...........   58               
INDEX TO FINANCIAL STATEMENTS...............................  F-1               
Appendix A--SECOND AMENDED AND RESTATED AGREEMENT AND PLAN                      
OF MERGER AMONG THE COMPANY, T1 ACQUISITION CORPORATION,                    
BUSINESS                                                                    
RESOURCES CORPORATION, AND WILLIAM D. OATES...............  A-1             
Appendix B--AMENDED AND RESTATED AGREEMENT AND PLAN OF                          
MERGER AMONG THE COMPANY, T2 ACQUISITION CORPORATION, THE                   
SOFTWARE GROUP, INC., GLENN A. SMITH,                                       
AND BRIAN B. BERRY........................................  B-1             
Appendix C--CERTIFICATE OF AMENDMENT TO RESTATED CERTIFICATE                    
OF INCORPORATION..........................................  C-1             

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TYLER CORPORATION 
2121 SAN JACINTO STREET 
SUITE 3200
DALLAS, TEXAS 75201 
--------------------------- 

PROXY STATEMENT 
FOR 
SPECIAL MEETING OF STOCKHOLDERS 

TO BE HELD FEBRUARY 19, 1998

--------------------------- 

GENERAL INFORMATION 

GENERAL                                                                         

This Proxy Statement is being furnished to stockholders of Tyler      
Corporation, a Delaware corporation (the "Company"), in connection with the     
solicitation of proxies on behalf of the board of directors of the Company (the 
"Tyler Board") for use at a special meeting of stockholders (the "Special       
Meeting") to be held on February 19, 1998, and at any postponements or          
adjournments thereof. Proxies in the form enclosed will be voted at the Special 
Meeting if properly executed, returned to the Company before the Special        
Meeting, and not revoked. You may revoke your proxy at any time before it is    
exercised by delivering written notice of revocation to the Secretary of the    
Company, by delivering a subsequently dated proxy, or by attending the Special  
Meeting, withdrawing your proxy, and voting your shares personally. The         
approximate date on which this Proxy Statement and the enclosed proxy card will 
first be sent to stockholders is January 22, 1998.                              

OUTSTANDING CAPITAL STOCK                                                       

     The record date for stockholders entitled to notice of, and to vote at, the
Special Meeting is the close of business on January 16, 1998 (the "Record       
Date"). At the close of business on the Record Date, the Company had 21,943,712 
shares of Common Stock, $.01 par value per share ("Common Stock"), issued and   
outstanding and entitled to vote at the Special Meeting. The Common Stock is the
only class of outstanding voting securities of the Company.                     

QUORUM AND VOTING                                                               

    The presence at the Special Meeting, in person or by proxy, of the holders
of a majority of the shares of Common Stock issued and outstanding and entitled 
to vote at the Special Meeting is necessary to constitute a quorum to transact  
business. Each share represented at the Special Meeting in person or by proxy   
will be counted for purposes of determining whether a quorum is present. In     
deciding all questions, a holder of Common Stock is entitled to one vote, in    
person or by proxy, for each share held in his name on the record date. Approval
of Proposal No. 1 and Proposal No. 2 (each as described herein) will each       
require the affirmative vote of a majority of votes cast at the Special Meeting,
provided that the total votes cast, either for or against the respective        
proposal, plus abstentions, collectively represent over 50% in interest of the  
shares issued and outstanding and entitled to vote thereon at the Special       
Meeting. Broker non-votes (as described below) will not be included in vote     
totals for and will not be counted as votes cast on Proposal No. 1 or Proposal  
No. 2. Approval of Proposal No. 3 (as described herein) will require the        
affirmative vote of the holders of record of a majority of the shares of the    
Common Stock issued and outstanding and entitled to vote thereon at the Special 
Meeting.                                                                        

    Abstentions will be treated as shares of Common Stock that are present and
entitled to vote for purposes of determining the presence of a quorum.          
Abstentions will be included in vote totals and thus will have the same effect  
on each proposal as a negative vote. If a proxy is returned by a broker or other
stockholder who does not have authority to vote, does not give authority to a   
proxy to vote, or withholds authority to vote on one or more matters as to any  
shares of Common Stock, such shares will be considered present at the Special   

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Meeting for purposes of determining a quorum, but will not be included in vote  
totals. With respect to Proposal No. 1 and Proposal No. 2, such broker non-votes
will have no effect on the vote. With respect to Proposal No. 3, such broker    
non-votes will have the effect of negative votes.                               

ACTION TO BE TAKEN AT THE MEETING                                               

    Proposal No. 1. The Company has entered into a Second Amended and Restated
Agreement and Plan of Merger (the "Resources Merger Agreement"), dated as of    
December 29, 1997, and effective as of October 8, 1997, among the Company, T1   
Acquisition Corporation, a newly formed Texas corporation and wholly owned      
subsidiary of the Company ("T1"), Business Resources Corporation, a Texas       
corporation (referred to herein as "Resources"), and William D. Oates, for the  
purpose of acquiring Resources. Pursuant to the Resources Merger Agreement, and 
the transactions contemplated therein, Resources will be merged with and into T1
(the "Resources Acquisition"). The surviving corporation will be a wholly owned 
subsidiary of the Company. As used in this Proxy Statement, "Resources" refers, 
as the context may require, to Business Resources Corporation or to Business    
Resources Corporation and its subsidiaries, including Government Records        
Services, Inc. ("GRS"), on a consolidated basis.                                

   Proposal No. 2. The Company has also entered into an Amended and Restated
Agreement and Plan of Merger (the "TSG Merger Agreement"), dated as of December 
29, 1997, and effective as of October 8, 1997, among the Company, T2 Acquisition
Corporation, a newly formed Texas corporation and wholly owned subsidiary of the
Company ("T2"), The Software Group, Inc., a Texas corporation ("TSG"), Glenn A. 
Smith, and Brian B. Berry, for the purpose of acquiring TSG. Pursuant to the TSG
Merger Agreement, and the transactions contemplated therein, T2 will be merged  
with and into TSG (the "TSG Acquisition"). The surviving corporation will also  
be a wholly owned subsidiary of the Company. The Resources Acquisition and the  
TSG Acquisition are sometimes collectively referred to in this Proxy Statement  
as the "Acquisitions."                                                          

     The Tyler Board has unanimously approved the Resources Merger Agreement and
the TSG Merger Agreement.                                                       

  At the Special Meeting, the stockholders of the Company will be asked to
consider and vote upon the proposals to approve and adopt the Resources Merger  
Agreement and the TSG Merger Agreement. Stockholder approval of the Resources   
Merger Agreement and the TSG Merger Agreement is required under the rules of the
New York Stock Exchange due to the aggregate number of shares of Common Stock to
be issued if the Acquisitions are consummated. The affirmative vote of the      
Company's stockholders is also a condition to the closing of each of the        
Acquisitions. Consummation of each of the Acquisitions is also conditioned upon 
consummation of the other Acquisition. If the stockholders do not approve both  
of the Acquisitions, neither Acquisition will be consummated and both the       
Resource Merger Agreement and the TSG Merger Agreement will be terminated unless
consummation of the other Acquisition is waived by the appropriate party or     
parties.                                                                        

  Proposal No. 3. The Tyler Board has also unanimously approved a proposed
amendment to the Company's Restated Certificate of Incorporation (the "Charter")
to increase the number of authorized shares of Common Stock from 50,000,000     
shares to 100,000,000 shares. At the Special Meeting, the stockholders of the   
Company will also be asked to consider and vote upon the proposed amendment.    

Required Vote to Approve the Proposals. Approval of Proposal No. 1 and
Proposal No. 2 will require the affirmative vote of a majority of votes cast at 
the Special Meeting, provided that the total votes cast with respect to the     
respective proposal represent over 50% in interest of the shares issued and     
outstanding and entitled to vote thereon at the Special Meeting. Approval of    
Proposal No. 3 will require the affirmative vote of the holders of record of a  
majority of the shares of the Common Stock issued and outstanding and entitled  
to vote thereon at the Special Meeting.                                         

  Treatment of Proxies. When a stockholder has appropriately specified how
its proxy is to be voted, the proxy will be voted accordingly. Unless the       
stockholder otherwise specifies in the proxy, the proxy will be voted (i) for   
Proposal No. 1, (ii) for Proposal No. 2, (iii) for Proposal No. 3, and (iv) at  
the discretion of the proxy holders on any other matter that may properly come  
before the Special Meeting or any postponements or                              

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adjournments thereof. Only proxies voting for Proposal No. 1, Proposal No. 2,   
and Proposal No. 3 may be voted to adjourn the Special Meeting, if adjournment  
is presented for consideration at the Special Meeting. The Tyler Board knows of 
no such other matter.                                                           

RECOMMENDATIONS OF THE TYLER BOARD                                              

  THE TYLER BOARD HAS UNANIMOUSLY APPROVED THE RESOURCES MERGER AGREEMENT.
THE TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR PROPOSAL  
NO. 1.                                                                          

THE TYLER BOARD HAS UNANIMOUSLY APPROVED THE TSG MERGER AGREEMENT. THE
TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR PROPOSAL NO.  
2.                                                                              

    THE TYLER BOARD HAS UNANIMOUSLY APPROVED AND HAS DECLARED THE ADVISABILITY
OF THE AMENDMENT OF THE COMPANY'S CHARTER TO INCREASE THE NUMBER OF AUTHORIZED  
SHARES OF COMMON STOCK. THE TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE         
STOCKHOLDERS VOTE FOR PROPOSAL NO. 3.                                           

PERSONS MAKING THE SOLICITATION                                                 

     The accompanying proxy is being solicited on behalf of the Tyler Board. The
Company will bear the expense of preparing, printing, and mailing the proxy     
solicitation material and the form of proxy. No other person or persons will    
bear such costs either directly or indirectly. In addition to the use of the    
mail, proxies may be solicited by personal interview, telephone, telegram,      
facsimile, or other means of communication by directors, officers, and employees
of the Company. The Company may also engage the services of a proxy solicitation
firm to assist in the solicitation of proxies. The Company estimates that the   
fee of any such firm will not exceed $15,000 plus reimbursement of reasonable   
out-of-pocket expenses. In addition, the Company has requested brokerage firms  
and other custodians, nominees, and fiduciaries to forward copies of the proxy  
solicitation material and form of proxy to the beneficial owners of Common Stock
held of record by such persons and to request authority for execution of the    
proxies. The Company will reimburse such record holders for their reasonable    
out-of-pocket expenses in doing so.                                             

FORWARD-LOOKING STATEMENTS                                                      

     This Proxy Statement contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"),
and Section 21E of the Securities Exchange Act of 1934, as amended (the         
"Exchange Act"). All statements other than historical or current facts,         
including, without limitation, statements about the business, financial         
condition, business strategy, plans and objectives of management, and prospects 
of the Company, Resources, or TSG, are forward-looking statements. Although the 
Company and, with respect only to statements about Resources and TSG,           
respectively, Resources and TSG believe that the expectations reflected in such 
forward-looking statements are reasonable, such forward-looking statements are  
subject to risks and uncertainties that could cause actual results to differ    
materially from these expectations. Such risks and uncertainties include,       
without limitation, changes in product demand, turnover in the sales force, the 
availability of products, changes in competition, economic conditions, various  
inventory risks due to changes in market conditions, decrease in demand for     
information management services or record services generally or by governmental 
authorities, new technological developments, changes in tax and other           
governmental rules and regulations applicable to the Company, or to Resources or
TSG, and other risks indicated in the Company's filings with the Securities and 
Exchange Commission (the "Commission"). These risks and uncertainties are beyond
the ability of the Company, Resources or TSG to control and, in many cases, the 
Company, Resources or TSG cannot predict the risks and uncertainties that could 
cause actual results to differ materially from those indicated by the           
forward-looking statements. When used in this Proxy Statement, the words        
"believes," "plans," "estimates," "expects," "anticipates," "intends," and      
similar expressions as they relate to the Company, Resources or TSG or their    
respective managements are intended to identify forward-looking statements.     

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THE COMPANY 

     Since its inception in 1966, the Company has provided products and services
to clients in a variety of industries through its ownership of various operating
companies. The acquisitions of Resources and TSG represent a shift in the       
Company's direction and entry into a new industry. As part of its business      
strategy to build value for its stockholders, the Company has reviewed entry    
into various industries, whether as a start-up operation or through             
acquisitions. Based on this review, the Company has focused on the information  
management industry, both because of the growth opportunities the Company       
believes exist and because of the opportunity to acquire Resources and TSG, two 
service companies with excellent reputations in the industry generally and      
specifically in the county government services market. The Company believes that
it, Resources, and TSG possess compatible and complementary management          
philosophies and strategic objectives. In addition, the Company expects that    
consolidating Resources and TSG as part of the Company and capitalizing on these
natural synergies will enhance existing business relationships, increase market 
share, and provide a base for future acquisitions.                              

     Resources and TSG provide information management solutions to approximately
200 county governments, principally located in the Southwestern United States.  
County governments are one of the fastest growing government sectors. There are 
over 3,000 county governments in the United States, and county governments are  
experiencing growth estimated at approximately 5% to 10% per year. The need for 
traditional county services continues to grow, and counties increasingly face   
service requirements to respond to new issues or to matters previously handled  
at the state or federal levels. At the same time, there is pressure to provide  
county services efficiently and on a cost-effective basis. For example, one of  
the biggest challenges facing counties is the growing requirement for criminal  
and civil court administration and jail management.                             

   The annual expenditure by county governments for information technologies
and resources, excluding personnel costs, was estimated in 1992 at over $23     
billion, with approximately $10 billion spent annually on information services  
and data processing. The Company's growth in this market will be enhanced       
through long-standing relationships with county governments and agencies that   
have been cultivated and maintained by Resources and TSG. The Company expects   
that the combination of Resources and TSG will position the Company as a leading
provider of information management solutions to county governments and related  
entities.                                                                       

The Company believes that the information management industry today is
fragmented and that the county government and related markets are primarily     
served by small, private companies. Given these industry characteristics and    
Resources' established ability to identify suitable acquisition candidates and  
complete acquisitions, the Company intends to pursue a consolidation strategy   
that, if successful, could lead to significant revenue growth for the Company.  
The acquisitions of Resources and TSG will position the Company to grow rapidly 
through consolidating acquisitions and give it the opportunity to obtain a      
larger share of the information management market. The Company intends to pursue
aggressively this consolidation strategy through an acquisition program focused 
on entry into new geographic markets, expansion within existing geographic      
markets, and development of related services and systems. The Company believes  
the management teams of Resources and TSG will be instrumental in identifying   
and negotiating with future acquisition candidates and will supplement the      
substantial acquisition experience of the Tyler Board and the Company's senior  
management.                                                                     

Resources provides a wide range of information management outsourcing 
services, primarily to county and local governments. Resources' current         
outsourcing services include records management, micrographic reproduction,     
computerized indexing, and imaging of real property records maintained by county
clerks and recorders, the largest component of its business, as well as         
information management outsourcing and professional services required by other  
county and local government units and agencies. Resources also provides title   
plant update services to title companies in Texas.                              

    Resources' primary emphasis since its inception has been supplying records
management, document workflow, and imaging products and services to county clerk
and district clerk offices in Texas. Resources is, however, currently expanding 
its property records management services business to Cook County, Illinois, as a

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result of a recent agreement with the Cook County, Illinois recorder's office   
and intends to expand aggressively its businesses into other geographic regions,
either by acquisition or internal growth.                                       

     TSG provides county governments with software systems and services to serve
their information technology and automation needs. TSG integrates its own       
products with computer equipment from hardware vendors, third-party database    
management applications, and office automation software. TSG assists a county   
with all aspects of its software and hardware selection, network design and     
management, installation and training, and on-going support and related         
services.                                                                       

 The Company continues to operate through Forest City Auto Parts Company
("Forest City"), a retailer of automotive parts and supplies. Forest City       
specializes in selling mechanical and electrical hard parts, such as brake      
parts, rack-and-pinion steering and fuel injectors, to do-it-yourself customers.
Forest City also stocks a wide variety of maintenance items, fluids, and        
accessories. Forest City currently has 70 locations in the Great Lakes area of  
the United States, each of which maintains average inventories of 16,000 parts  
for both domestic and foreign cars and light trucks. Quality customer service   
provided by knowledgeable store personnel is fundamental to Forest City's       
strategy.                                                                       

RECENT DEVELOPMENTS 

     On December 17, 1997, the Company entered into two definitive agreements to
acquire Interactive Computer Design, Inc. and a related company in Lubbock,     
Texas (collectively, "INCODE") for $1.25 million and 250,000 shares of Common   
Stock. INCODE provides integrated information management services, systems and  
outsourcing to 225 cities throughout Texas, Oklahoma, and Missouri as well as   
certain additional cities in contiguous states. INCODE serves cities having     
populations of up to 100,000, with an average size of 12,000. The INCODE        
acquisition is subject to customary conditions to closing, including the        
completion of a satisfactory due diligence review of INCODE by the Company. In  
addition, consummation of the INCODE acquisition is subject to the consummation 
of each of the Acquisitions. Subject to satisfaction or waiver of each of the   
closing conditions, the Company anticipates that the INCODE acquisition will    
close simultaneously with or shortly after the closing of the Acquisitions.     

  Effective October 15, 1997, the Company sold all of the capital stock of
its subsidiary, Institutional Financing Services, Inc. ("IFS"), to I.F.S.       
Acquisition Corporation for approximately $8.3 million, which resulted in a loss
on disposal of approximately $2.5 million. This estimated loss on disposal      
includes estimates regarding the value of certain assets that are subject to    
change. Management does not expect these estimates to have a significant impact 
on the estimated loss on disposal. Proceeds consisted of approximately $5.8     
million in cash paid at closing and approximately $2.5 million payable on       
January 31, 1998. The receipt of the $2.5 million is subject to a subordination 
agreement between the Company and I.F.S. Acquisition Corporation's lender and   
the timing of the payment could be adversely affected should IFS not achieve    
certain financial performance parameters. Management does not currently         
anticipate any such delays in payment.                                          

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SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA) 

THE COMPANY -- HISTORICAL AND PRO FORMA FINANCIAL DATA                          

The following selected historical consolidated financial data of the  
Company for the five years ended December 31, 1996 are derived from the         
consolidated financial statements of the Company which have been audited by     
Ernst & Young LLP, independent auditors. The selected historical consolidated   
financial data as of September 30, 1997, and for the nine months ended September
30, 1996 and 1997, are derived from unaudited consolidated financial statements 
of the Company. The unaudited consolidated financial statements include all     
adjustments, consisting only of normal recurring accruals, that the Company     
considers necessary for a fair presentation of the results of operations and    
financial position for these periods. Operating results for the nine months     
ended September 30, 1997 are not necessarily indicative of the results that may 
be expected for the entire year ending December 31, 1997. The selected          
historical consolidated financial data should be read in conjunction with the   
consolidated financial statements, related notes, and other financial           
information of the Company incorporated by reference herein. See "Incorporation 
of Certain Information by Reference." The selected pro forma consolidated data  
presented below are derived from the Unaudited Pro Forma Consolidated Financial 
Statements included elsewhere in this Proxy Statement.                          

                                                        [Enlarge/Download Table]

                                                                                                             NINE MONTHS        
                                                        YEAR ENDED DECEMBER 31,                          ENDED SEPTEMBER 30,    
                                     -------------------------------------------------------------   ---------------------------
                                                         HISTORICAL                         PRO         HISTORICAL         PRO  
                                     --------------------------------------------------    FORMA     -----------------    FORMA 
                                      1992      1993       1994       1995       1996     1996(1)     1996      1997     1997(1)
                                     -------   -------   --------   --------   --------   --------   -------   -------   -------
                                                                                                                                
STATEMENT OF OPERATIONS DATA:                                                                                                   
Net revenues........................ $78,453   $84,464   $ 91,849   $ 86,893   $ 85,074   $115,932   $65,852   $58,172   $83,729
Costs and expenses:                                                                                                             
  Costs of revenues.................  43,973    46,566     53,626     51,126     49,275     64,409    37,799    33,216    45,019
  Selling, general and                                                                                                          
    administrative(2)...............  31,745    33,695     36,229     34,531     41,162     46,038    25,916    22,830    26,897
  Amortization of goodwill..........   1,073     1,092      1,111      1,112      1,101      2,931       826        --     1,372
  Depreciation and amortization.....     339       770        895      1,060      1,368      4,261       796     1,483     3,810
  Interest (income) expense, net....     122        85        678      1,003       (277)     2,058      (214)     (613)    1,543
  Goodwill and other intangibles                                                                                                
    impairment charge...............      --        --         --         --     14,789     14,789        --        --        --
  Other income and expense, net.....      --        --         --         --         --         11        --        --        --
                                     -------   -------   --------   --------   --------   --------   -------   -------   -------
Income (loss) from continuing                                                                                                   
  operations before taxes...........   1,201     2,256       (690)    (1,939)   (22,344)   (18,565)      729     1,256     5,088
Income tax (benefit)................     455     1,308        (24)      (497)    (3,037)      (938)      898       454     2,349
                                     -------   -------   --------   --------   --------   --------   -------   -------   -------
Income (loss) from continuing                                                                                                   
  operations........................ $   746   $   948   $   (666)  $ (1,442)  $(19,307)  $(17,627)  $  (169)  $   802   $ 2,739
                                     =======   =======   ========   ========   ========   ========   =======   =======   =======
Income (loss) per common share:                                                                                                 
  Continuing operations............. $  0.04   $  0.05   $  (0.03)  $  (0.07)  $  (0.97)  $   (.55)  $ (0.01)  $  0.04   $  0.09
                                     =======   =======   ========   ========   ========   ========   =======   =======   =======
Weighted average number of common                                                                                               
  shares outstanding................  20,779    20,556     19,925     19,869     19,876     31,876    19,875    20,145    32,145
OTHER DATA:                                                                                                                     
EBITDA(3)........................... $ 2,735   $ 4,203   $  1,994   $  1,236   $ (5,363)  $  5,474   $ 2,137   $ 2,126   $11,813

                                                        [Enlarge/Download Table]

                                                                                              AS OF       
                                                                                          SEPTEMBER 30,   
                                                                                        ------------------
                                                   AS OF DECEMBER 31,                               PRO   
                                  ----------------------------------------------------             FORMA  
                                    1992       1993       1994       1995       1996     1997     1997(1) 
                                  --------   --------   --------   --------   --------  -------   --------
                                                                                                          
BALANCE SHEET DATA:                                                                                       
Total assets..................... $146,231   $143,171   $197,800   $123,512   $ 59,390  $60,771   $144,279
Long-term debt...................       --         --     63,500         --         --       --     22,040
Shareholders' equity.............  122,343    117,964    110,298     93,362     32,041   32,057     80,207

                                                        [Enlarge/Download Table]

                                                                                            NINE MONTHS      
                                                                                               ENDED         
                                                  YEAR ENDED DECEMBER 31,                  SEPTEMBER 30,     
                                     --------------------------------------------------  -----------------   
                                      1992      1993       1994       1995       1996     1996      1997     
                                     -------   -------   --------   --------   --------  -------   -------   
                                                                                                             
STATEMENT OF CASH FLOWS DATA:                                                                                
Cash flows from operating                                                                                    
  activities........................ $12,127   $19,183   $ (4,343)  $ 16,226   $  7,306  $ 2,288     1,478   
Cash flows from investing                                                                                    
  activities........................  (9,949)  (10,982)   (72,970)    48,083      5,440    3,873    (1,370)  
Cash flows from financing                                                                                    
  activities........................    (319)   (2,116)    60,535    (62,663)         9       --     3,705   

---------------------                                                           

(1) Gives effect (i) for the year ended December 31, 1996, to the Acquisitions  
of Resources (including the Title Acquisition (as defined herein) by    
   Resources) and TSG as if they had occurred on January 1, 1996, (ii) for the
nine months ended September 30, 1997, to the Acquisitions of Resources  
(including the Title Acquisition by Resources) and TSG as if they had   
occurred on January 1, 1996, and (iii) as of September 30, 1997, to the 
    Acquisitions of Resources and TSG as if they occurred on September 30, 1997.
(2) 1996 includes pretax restructuring and other charges of $7,250.             
(3) EBITDA consists of income from continuing operations before interest, income
taxes, depreciation, amortization, and the goodwill impairment charge.  
Although EBITDA is not calculated in accordance with generally accepted 
   accounting principles, the Company believes that EBITDA is widely used as a
  measure of operating performance. Nevertheless, this measure should not be
   considered in isolation or as a substitute for operating income, cash flows
from operating activities, or any other measure for determining the     
Company's operating performance or liquidity that is calculated in      
 accordance with generally accepted accounting principles. EBITDA does not
take into account the Company's debt service requirements and other     
commitments and, accordingly, EBITDA is not necessarily indicative of   
   amounts that may be available for reinvestment in the Company's business or
   other discretionary uses. In addition, since all companies do not calculate
  EBITDA in the same manner, this measure may not be comparable to similarly
titled measures reported by other companies.                            

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RESOURCES -- HISTORICAL FINANCIAL DATA                                          

 The selected historical consolidated financial data presented below are
derived from the consolidated financial statements of Resources. The            
consolidated financial statements of Resources as of December 31, 1994, 1995 and
1996, and for the years then ended have been audited by KPMG Peat Marwick LLP,  
independent certified public accountants. The selected historical consolidated  
financial data as of December 31, 1992 and 1993, and for the years then ended   
are derived from the unaudited consolidated financial statements of Resources,  
which, in the opinion of Resources' management, include all adjustments,        
consisting only of normal recurring adjustments necessary for a fair            
presentation of the results of operations and financial condition of Resources  
for the unaudited periods. The selected historical consolidated financial data  
should be read in conjunction with the consolidated financial statements,       
including the notes thereto, and other financial information of Resources       
appearing elsewhere in this Proxy Statement.                                    

                                                        [Enlarge/Download Table]

                                                    PREDECESSOR                                 SUCCESSOR                       
                                           ------------------------------  ---------------------------------------------------- 
                                                                                                                 NINE MONTHS    
                                             YEARS ENDED      JANUARY 1,   DECEMBER 1,       YEARS ENDED            ENDED       
                                            DECEMBER 31,     1994 THROUGH  1994 THROUGH     DECEMBER 31,        SEPTEMBER 30,   
                                           ---------------   NOVEMBER 30,  DECEMBER 31,   -----------------   ----------------- 
                                            1992     1993        1994          1994        1995      1996      1996     1997(1) 
                                           ------   ------   ------------  ------------   -------   -------   -------   ------- 
                                                                                                                                
STATEMENT OF OPERATIONS DATA(2):                                                                                                
Revenues.................................. $2,653   $3,668      $4,514        $  366      $ 7,545   $14,729   $11,035   $13,997 
Cost of revenues..........................  1,715    2,387       3,156           252        6,091     8,461     6,247     7,792 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Gross margin..............................    938    1,281       1,358           114        1,454     6,268     4,788     6,205 
Selling, general and administrative                                                                                             
  expenses................................    770    1,072       1,263           268        2,687     2,790     2,064     2,744 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Operating income (loss)...................    168      209          95          (154)      (1,233)    3,478     2,724     3,461 
Interest expense, net.....................     48       61          33            --          157       463       346       388 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Income (loss) from continuing operations                                                                                        
  before income taxes.....................    120      148          62          (154)      (1,390)    3,015     2,378     3,073 
Income tax expense (benefit)..............     --      (56)        (17)          (13)        (444)    1,125       880        52 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Income (loss) from continuing                                                                                                   
  operations..............................    120      204          79          (141)        (946)    1,890     1,498     3,021 
Discontinued operations:                                                                                                        
  Income (loss) from discontinued                                                                                               
    operations, net of income taxes in                                                                                          
    1994 of $200 -- Predecessor and                                                                                             
    $18 -- Successor, and income tax                                                                                            
    benefit of $422 in 1995...............     --       --         388            35         (819)       --        --        -- 
  Gain from disposal of discontinued                                                                                            
    operations, net of income taxes of                                                                                          
    $379..................................     --       --          --            --          737        --        --        -- 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Income (loss) before extraordinary item...    120      204         467          (106)      (1,028)    1,890     1,498     3,021 
Extraordinary item -- extinguishment of                                                                                         
  debt, net of income taxes of $53........ $   --   $   --      $ (104)       $   --      $    --   $    --   $    --   $    -- 
                                           ------   ------      ------        ------      -------   -------   -------   ------- 
Net income (loss)......................... $  120   $  204      $  363        $ (106)     $(1,028)  $ 1,890   $ 1,498   $ 3,021 
                                           ======   ======      ======        ======      =======   =======   =======   ======= 
Pro forma income data(3):                                                                                                       
  Net earnings as reported................                                                                                3,021 
  Pro forma adjustment to provide for                                                                                           
    income taxes..........................                                                                               (1,198)
                                                                                                                        ------- 
  Pro forma net earnings..................                                                                              $ 1,823 
                                                                                                                        ======= 
Income (loss) per share (historical):                                                                                           
  Continuing operations................... $ 1.20   $ 2.04      $  .79        $(1.41)     $ (9.46)  $ 18.90   $ 14.98           
  Discontinued operations.................     --       --        3.88           .35         (.82)       --        --           
  Extraordinary item......................     --       --       (1.04)           --           --        --        --           
                                           ------   ------      ------        ------      -------   -------   -------           
        Net income (loss) per share....... $ 1.20   $ 2.04      $ 3.63        $(1.06)     $(10.28)  $ 18.90   $ 14.98           
                                           ======   ======      ======        ======      =======   =======   =======           
Pro forma income per share................                                                                              $ 18.23 
Average shares used in per share                                                                                                
  computation(4)..........................    100      100         100           100          100       100       100       100 

                                                        [Enlarge/Download Table]

                                                                                                         AS OF SEPTEMBER 30,
                                                                         AS OF DECEMBER 31,              -------------------
                                                             ------------------------------------------            PRO FORMA
                                                             1992    1993     1994     1995      1996     1997      1997(3) 
                                                             ----   ------   ------   -------   -------  -------   ---------
                                                                                                                            
BALANCE SHEET DATA:                                                                                                         
Total assets................................................ $537   $1,817   $2,596   $10,745   $11,250  $18,046    $18,265 
Long-term debt, excluding current portion...................  427      762       --     5,256     3,884    7,090      7,090 
Stockholders' equity (deficit)..............................   21     (144)   2,405     1,527     3,417    6,438      3,357 

---------------                                                                 

(1) The results presented only include the Title Acquisition, which was         
completed on July 31, 1997, for two months during the nine months ended 
September 30, 1997.                                                     

(2) Prior to December 1, 1994, the net assets of GRS, which is Resources'       
largest subsidiary and conducts primarily all business operations for   
    Resources, were part of American Title Group, Inc. The financial information
  for the periods through November 30, 1994, reflects the historical cost of
   the assets and liabilities of GRS and its operating results and is referred
to herein as "Predecessor."                                             

(3) Resources changed from being taxed as a C corporation to being taxed as an S
corporation effective January 1, 1997. The September 30, 1997 pro forma 
   consolidated balance sheet (unaudited) has been adjusted to reflect (i) the
 payment of dividends in 1997 to the Class A Holder (as defined herein) in
the estimated amount of $3,300 in respect of the remaining federal tax  
    liabilities attributable to the Resources' historical S corporation earnings
    for the nine months ended September 30, 1997, on a pro forma basis, and (ii)
    the establishment of deferred income tax assets of $219 that would have been
required if Resources had terminated its S corporation status as of     
    September 30, 1997. The pro forma consolidated income statement for the nine
months ended September 30, 1997, reflects an income tax provision as if 
Resources terminated its S corporation status as of January 1, 1997. See
"Unaudited Pro Forma Condensed Consolidated Financial Statements."      

(4) In December 1997, Resources increased its authorized, issued and outstanding
shares of common stock from 1 to 100 shares. The effect of this         
 recapitalization has been applied retroactively for all periods presented
herein.                                                                 

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TSG -- HISTORICAL FINANCIAL DATA                                                

     The selected historical financial data presented below are derived from the
financial statements of TSG. The financial statements of TSG as of October 31,  
1996 and 1997, and for the years then ended have been audited by KPMG Peat      
Marwick LLP, independent certified public accountants. The selected historical  
consolidated financial data as of October 31, 1993, 1994 and 1995, and for the  
years then ended, are derived from the unaudited financial statements of TSG,   
which, in the opinion of TSG's management, include all adjustments, consisting  
only of normal recurring adjustments necessary for a fair presentation of the   
results of operations and financial condition of the TSG for the unaudited      
periods. The selected historical financial data should be read in conjunction   
with the financial statements, including the notes thereto, and other financial 
information of TSG appearing elsewhere in this Proxy Statement.                 

                                                        [Enlarge/Download Table]

                                                                 YEARS ENDED OCTOBER 31,            
                                                      --------------------------------------------- 
                                                       1993     1994     1995      1996      1997   
                                                      ------   ------   -------   -------   ------- 
                                                                                                    
STATEMENT OF OPERATIONS DATA:                                                                       
Revenues............................................  $7,403   $9,552   $10,793   $11,052   $11,571 
Cost of revenues....................................   3,533    5,034     5,728     5,157     4,568 
                                                      ------   ------   -------   -------   ------- 
Gross margin........................................   3,870    4,518     5,065     5,895     7,003 
Selling, general and administrative expenses........   3,928    4,390     5,030     5,054     5,313 
                                                      ------   ------   -------   -------   ------- 
Operating income (loss).............................     (58)     128        35       841     1,690 
Interest income.....................................      26       14        39        56        87 
Other expense.......................................      --       (1)      (12)      (11)       -- 
                                                      ------   ------   -------   -------   ------- 
Income (loss) before taxes..........................     (32)     141        62       886     1,777 
Income tax expense..................................     144      189        36       339       658 
                                                      ------   ------   -------   -------   ------- 
Net income (loss)...................................    (176)     (48)       26       547     1,119 
Adjustment to fair market value of shares subject to                                                
  redemption........................................      --       (9)      (94)       --       (22)
                                                      ------   ------   -------   -------   ------- 
Net income (loss) available to common                                                               
  shareholders......................................  $ (176)  $  (57)  $   (68)  $   547   $ 1,097 
                                                      ======   ======   =======   =======   ======= 
Income (loss) per share.............................  $(0.08)  $(0.03)  $ (0.03)  $  0.26   $  0.53 
                                                      ======   ======   =======   =======   ======= 
Average common and common share equivalent shares                                                   
  used in per share computation.....................   2,154    2,154     2,143     2,145     2,078 

                                                        [Enlarge/Download Table]

                                                                    AS OF OCTOBER 31,             
                                                        ------------------------------------------
                                                         1993     1994     1995     1996     1997 
                                                        ------   ------   ------   ------   ------
                                                                                                  
BALANCE SHEET DATA:                                                                               
Total assets........................................... $2,830   $2,646   $3,084   $4,059   $5,493
Long-term debt.........................................      5       --       --       --       --
Redeemable common stock................................    323      332      427      427       --
Stockholders' equity...................................  1,448    1,370    1,727    2,224    3,321

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COMPARATIVE DATA

The following tables set forth certain per share data for the Company,
Resources, and TSG on a historical and pro forma basis, giving effect to the    
Acquisitions using the purchase method of accounting, as well as equivalent pro 
forma per share data for Resources and TSG. Historical per share data is also   
provided for Resources, which has one shareholder, and TSG, which has three     
shareholders. The unaudited pro forma per share data provided below is not      
necessarily indicative of the results of operations or the financial position   
which would have occurred had the Acquisitions been consummated on the indicated
dates or which may be attained in the future and should be read in conjunction  
with the historical consolidated financial statements of the Company, which are 
incorporated by reference in this Proxy Statement, the historical consolidated  
financial statements of Resources and TSG, which are included elsewhere in this 
Proxy Statement, and "Unaudited Pro Forma Condensed Consolidated Financial      
Statements."                                                                    

THE COMPANY -- HISTORICAL 

                                                        [Enlarge/Download Table]

                                                             AS OF AND FOR THE  AS OF AND FOR THE 
                                                                YEAR ENDED      NINE MONTHS ENDED 
                                                             DECEMBER 31, 1996  SEPTEMBER 30, 1997
                                                             -----------------  ------------------
                                                                                                  
Per share data:                                                                                   
  Book value................................................      $ 1.61              $1.46       
  Cash dividends declared...................................          --                 --       
  Income (loss) from continuing operations..................      $(0.97)             $0.04       

RESOURCES -- HISTORICAL 

                                                        [Enlarge/Download Table]

                                                             AS OF AND FOR THE  AS OF AND FOR THE 
                                                                YEAR ENDED      NINE MONTHS ENDED 
                                                             DECEMBER 31, 1996  SEPTEMBER 30, 1997
                                                             -----------------  ------------------
                                                                                                  
Per share data:                                                                                   
  Book value................................................      $34.17              $64.38      
  Cash dividends declared...................................          --                  --      
  Net income................................................      $18.90              $30.21      

TSG -- HISTORICAL 

                                                        [Enlarge/Download Table]

                                             AS OF AND FOR THE  AS OF AND FOR THE  AS OF AND FOR THE
                                                YEAR ENDED         YEAR ENDED      NINE MONTHS ENDED
                                             OCTOBER 31, 1996   OCTOBER 31, 1997     JULY 31, 1997  
                                             -----------------  -----------------  -----------------
                                                                                                    
Per share data:                                                                                     
  Book value................................       $1.16              $1.73              $1.58      
  Cash dividends declared...................       $0.02                 --                 --      
  Net income................................       $0.26              $0.53              $0.39      

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THE COMPANY, RESOURCES, AND TSG -- PRO FORMA

                                                        [Enlarge/Download Table]

                                                             AS OF AND FOR THE  AS OF AND FOR THE 
                                                                YEAR ENDED      NINE MONTHS ENDED 
                                                             DECEMBER 31, 1996  SEPTEMBER 30, 1997
                                                             -----------------  ------------------
                                                                                                  
Per share data:                                                                                   
  Book value................................................         N/A              $2.36       
  Cash dividends declared...................................         N/A                 --       
  Income (loss) from continuing operations..................      $(0.55)             $0.09       

RESOURCES -- EQUIVALENT PRO FORMA 

                                                        [Enlarge/Download Table]

                                                             AS OF AND FOR THE  AS OF AND FOR THE 
                                                                YEAR ENDED      NINE MONTHS ENDED 
                                                             DECEMBER 31, 1996  SEPTEMBER 30, 1997
                                                             -----------------  ------------------
                                                                                                  
Per share data(1):                                                                                
  Book value................................................          N/A            $236.00      
  Cash dividends declared...................................      $    --            $    --      
  Net income (loss).........................................      $(55.00)           $  9.00      

TSG -- EQUIVALENT PRO FORMA 

                                                        [Enlarge/Download Table]

                                                             AS OF AND FOR THE  AS OF AND FOR THE 
                                                                YEAR ENDED      NINE MONTHS ENDED 
                                                             DECEMBER 31, 1996  SEPTEMBER 30, 1997
                                                             -----------------  ------------------
                                                                                                  
Per share data(2):                                                                                
  Book value................................................         N/A              $2.28       
  Cash dividends declared...................................      $   --              $  --       
  Net income (loss).........................................      $(0.53)             $0.09       

---------------                                                                 

(1) Equivalent pro forma Resources amounts are calculated by multiplying the    
  consolidated pro forma amounts per share by the exchange ratio so that the
per share amounts are equated to the respective amounts for one share of
Resources common stock. The exchange ratio is determined by dividing the
10,000,000 shares of Common Stock to be issued by the 100,000 shares of 
outstanding Resources common stock.                                     

(2) Equivalent pro forma TSG amounts are calculated by multiplying the          
  consolidated pro forma amounts per share by the exchange ratio so that the
    per share amounts are equated to the respective amounts for one share of TSG
common stock. The exchange ratio is determined by dividing the 2,000,000
  shares of Common Stock to be issued by the 1,921,000 shares of outstanding
   TSG common stock and 150,000 shares of TSG common stock to be acquired upon
 the exercise of stock options immediately prior to the closing of the TSG
Acquisition.                                                            

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THE ACQUISITIONS
(PROPOSAL NO. 1 AND PROPOSAL NO. 2) 

GENERAL                                                                         

    Pursuant to the terms of the Resources Merger Agreement, Resources will be
merged with and into T1, a newly formed, wholly owned subsidiary of the Company.
As a result, the separate corporate existence of Resources will cease and T1    
will be the surviving corporation (referred to herein as "New Resources")       
succeeding to and assuming all of the rights and obligations of Resources in    
accordance with the Texas Business Corporation Act ("TBCA"). Upon consummation  
of the Resources Acquisition pursuant to the Resources Merger Agreement, the    
holders of all of the issued and outstanding shares of Resources class A common 
stock and class B common stock will be entitled to receive in the aggregate     
$15,250,000 in cash and 10,000,000 shares of Common Stock at the Effective Time 
(as defined herein) and, subject to achievement of certain criteria, the holder 
of all of Resources class A common stock may be entitled to receive up to       
$4,500,000 on or before December 31, 1999.                                      

Pursuant to the terms of the TSG Merger Agreement, T2, a newly formed,
wholly owned subsidiary of the Company, will be merged with and into TSG. As a  
result, the separate corporate existence of T2 will cease and TSG will be the   
surviving corporation as a wholly owned subsidiary of the Company in accordance 
with the TBCA. Upon consummation of the TSG Acquisition pursuant to the TSG     
Merger Agreement, all of the issued and outstanding shares of TSG common stock  
will be converted into the right to receive in the aggregate $12,000,000 in cash
and 2,000,000 shares of Common Stock at the Effective Time.                     

BACKGROUND OF THE ACQUISITIONS                                                  

     In the fourth quarter of 1996, the Company began exploring ways to redirect
its business into complementary or new industries. Over several months, the     
Company examined a number of alternatives. One of the industries the Company    
reviewed was information management services. C. A. Rundell, Jr., the Company's 
President and Chief Executive Officer, had known William D. Oates, the Chairman 
of the Board, President, Chief Executive Officer, and sole holder of Resources  
class A common stock ("Mr. Oates" or the "Class A Holder"), for over 14 years   
and was generally familiar with Resources' business. In 1983, Mr. Rundell was   
the Chief Executive Officer of Cronus Industries, Inc. ("Cronus"), a former     
subsidiary of the Company which was spun-off from the Company in 1977 and is now
known as BRC Holdings, Inc., a publicly traded company (together with its       
subsidiaries, "Holdings"), when Cronus acquired Business Records Corporation    
("Records"). Mr. Oates was a co-founder and the principal shareholder of        
Records. Between 1986 and 1996, Mr. Rundell served from time to time as a       
consultant for Mr. Oates and certain of his companies with respect to various   
proposed transactions.                                                          

  On June 24, 1997, Mr. Rundell, then the Company's Chairman of the Board,
introduced Mr. Oates to Bruce Wilkinson, the then President and Chief Executive 
Officer of the Company, and discussed, very generally, the Company's possible   
interest in a transaction with Resources.                                       

  On July 17, 1997, at a meeting of the Tyler Board, Mr. Rundell described
strategic alternatives for the growth of the Company, including entry into      
numerous industries, including information management services, especially with 
respect to county government records.                                           

     On July 25, 1997, Mr. Rundell and Louis A. Waters, who became a director of
the Company in August 1997 and was elected Chairman of the Board of the Company 
in October 1997, met with Mr. Oates, Glenn A. Smith, the President and a        
principal shareholder of TSG, and Brian B. Berry, the Vice President and a      
principal shareholder of TSG, to discuss possible acquisitions of Resources and 
TSG by the Company.                                                             

     On July 30, 1997, Messrs. Rundell, Oates, and Berry met at the headquarters
of Resources. Mr. Berry presented Messrs. Rundell and Oates with a proposed     
letter of intent for the Company's purchase of TSG's common stock in exchange   
for $12,000,000 in cash and 2,000,000 shares of Common Stock. The acquisition   
proposed by Mr. Berry was contingent upon the Company's acquisition of          
Resources. The proposed letter of intent was not executed.                      

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    Effective July 31, 1997, Resources acquired the title services division of
Holdings. This acquisition added title plant update and maintenance services to 
Resources' county property records management business, together with a         
long-term customer base of title insurance companies and agents, which enhanced 
the value of Resources as an acquisition candidate for the Company.             

     On August 5, 1997, Mr. Rundell met with Mr. Oates and formally proposed the
acquisition of Resources by the Company. Thereafter, on August 15, 1997, Mr.    
Rundell provided Resources with the Company's written term sheet for the        
acquisition of Resources for a purchase price of approximately $37,500,000      
consisting of $22,500,000 in cash and, based on the closing sale price per share
of the Common Stock on August 4, 1997, a total of 6,000,000 shares of Common    
Stock.                                                                          

     On August 15, 1997, Mr. Berry delivered a revised draft letter of intent to
Mr. Rundell. The financial terms and acquisition structure set forth therein    
remained unchanged from the initial draft of July 30, 1997.                     

  From mid-August 1997 through early September 1997, several conversations
and meetings were held between the principals of the Company and Resources      
regarding the material terms of the proposed acquisition, including the amount  
of the purchase price to be paid in cash versus shares of Common Stock, the     
number of stock options or other incentives to be granted by the Company or by  
Mr. Oates to certain employees of Resources, and the disposition of the         
Resources headquarters, which is owned by Mr. Oates and currently leased to     
Resources. On August 19, 1997, Messrs. Rundell and Oates, John D. Woolf, the    
Executive Vice President and Chief Financial Officer of Resources, and a        
representative of Gardere & Wynne, L.L.P. ("Gardere & Wynne"), as counsel to    
Resources, met at Resources' headquarters to discuss the terms of the proposed  
acquisitions based on the previous negotiations.                                

   On August 20, 1997, the parties agreed in principle to a term sheet based
on the closing sale price per share of the Common Stock on August 4, 1997. The  
purchase price set forth therein was $38,250,000, consisting of $13,250,000 in  
cash and 10,000,000 shares of Common Stock. The term sheet provided for Mr.     
Oates to retain the headquarters building and to grant options to certain       
Resources' employees to purchase shares of Common Stock to be acquired by Mr.   
Oates in the proposed acquisition. Since Resources is an S corporation for      
federal income tax purposes, the term sheet also contemplated a maximum amount  
of distributions, not to exceed $1,000,000, that could be made to the Class A   
Holder prior to the closing of the acquisition. The parties also agreed to      
prepare the definitive agreement using the previously negotiated terms and      
conditions of the agreement for the 1983 acquisition of Records by Cronus with  
such changes as might be necessary to reflect the specific terms of the proposed
acquisition and changes in the law since 1983.                                  

    In August 1997, the Company retained Liddell, Sapp, Zivley, Hill & LaBoon,
L.L.P. ("Liddell Sapp"), as special counsel to represent the Company in         
connection with negotiations with Resources and TSG and preparation of the      
respective definitive acquisition agreements                                    

From August 20, 1997, through September 9, 1997, the principals of the
Company and Resources and their respective counsel continued to have discussions
regarding the structure of the proposed acquisition and further refinement of   
the material terms. At the end of August 1997, the Company and Resources began  
their formal due diligence inquiries. On September 9, 1997, the parties agreed  
to reduce the purchase price to $36,250,000, consisting of $13,750,000 in cash  
and 9,000,000 shares of Common Stock. The reduction in the purchase price       
reflected the Company's agreement to permit Resources, instead of Mr. Oates, to 
make certain employee payments, totaling $2,000,000, and to incur additional    
indebtedness for that purpose if necessary. The Company also contemplated       
purchasing the Resources headquarters facility directly from Mr. Oates.         

On September 12, 1997, Liddell Sapp distributed a first draft of the  
Resources Merger Agreement to Resources and Gardere & Wynne, as counsel to      
Resources. On September 16, 1997, a drafting session was held in Gardere &      
Wynne's office in Dallas, Texas, with Messrs. Rundell, Waters, Oates, and Woolf 
and representatives of Liddell Sapp and Gardere & Wynne to discuss the initial  
drafts of the Resources Merger Agreement. The primary purpose of the drafting   
session was to agree on those matters that could vary from the 1983 acquisition 
agreement and to negotiate the terms of those matters.                          

     From September 17, 1997, through October 7, 1997, the parties, directly and
through their respective counsel, continued to negotiate the various aspects of 
the proposed acquisition, including the tax treatment,                          
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the status of the headquarters building, the amount of distributions to Mr.     
Oates as the sole shareholder of Resources prior to closing of the acquisition, 
the registration rights to be granted to Mr. Oates and his optionees, and the   
amount and nature of the additional merger consideration that may be paid to the
Class A Holder. During this period, the Company, Resources, and Mr. Oates agreed
that Mr. Oates would transfer the headquarters building to Resources. Based on  
the cumulative effect of these changes, the parties agreed to increase the      
purchase price to $40,250,000, consisting of $15,250,000 in cash and 10,000,000 
shares of Common Stock. The parties also agreed that (i) Mr. Oates would        
contribute the Resources headquarters facility to Resources prior to closing,   
(ii) the permissible amount of distributions that could be made to Mr. Oates    
prior to closing would be increased to $3,300,000, (iii) the Company and Mr.    
Oates would both grant stock options to certain employees of Resources, and (iv)
Resources would transfer certain unrelated real property to Mr. Oates prior to  
closing.                                                                        

  In late September 1997, the Company and Liddell Sapp provided a draft of
the proposed Resources Merger Agreement to Messrs. Smith and Berry and TSG's    
counsel, Andrews & Barth, P.C. ("Andrews & Barth"). On September 30, 1997, Mr.  
Berry met with a representative of Andrews & Barth to review the proposed       
Resources Merger Agreement as a model for negotiating a merger agreement for the
proposed TSG Acquisition. Later that same day, representatives of Andrews &     
Barth and Liddell Sapp held a telephone conference to negotiate changes         
applicable to the proposed TSG Acquisition.                                     

   On October 1, 1997, Messrs. Rundell and Waters met with Messrs. Smith and
Berry and a representative of Andrews & Barth to finalize substantially the     
terms and conditions of the proposed TSG Merger Agreement. The financial terms  
and acquisition structure did not change from the terms set forth in the August 
15, 1997, draft letter of intent.                                               

 On October 7, 1997, the board of directors and Mr. Oates, then the sole
shareholder of Resources, unanimously approved the original Resources Merger    
Agreement by joint unanimous written consent.                                   

On October 8, 1997, the board of directors and shareholders of TSG    
unanimously approved the original TSG Merger Agreement by unanimous written     
consents.                                                                       

A special meeting of the Tyler Board was held on October 8, 1997, in  
Dallas, Texas. The meeting was attended by all of the directors of the Company, 
the Company's Chief Financial Officer and the Company's Controller, a           
representative of Liddell Sapp as special counsel, and a representative of      
Gardere & Wynne as outside legal counsel to the Company. Mr. Rundell reviewed in
detail the proposed Acquisitions and the proposed Resources Merger Agreement and
proposed TSG Merger Agreement, which had previously been distributed to the     
Tyler Board. The proposed Acquisitions and the respective merger agreements were
then discussed in detail by the directors and other persons present at the      
meeting. After due deliberation, the Tyler Board unanimously approved both the  
original Resources Merger Agreement and the original TSG Merger Agreement,      
directed the officers of the Company to execute and deliver the original        
Resources Merger Agreement and the original TSG Merger Agreement, recommended   
approval of the original Resources Merger Agreement and the original TSG Merger 
Agreement to the stockholders of the Company, and directed that the original    
Resources Merger Agreement and the original TSG Merger Agreement be submitted to
a vote of the stockholders of the Company for their approval and adoption at a  
special meeting of the stockholders called for that purpose.                    

The original Resources Merger Agreement was thereafter executed in    
counterparts by the Company, T1, Resources, and Mr. Oates, and the original TSG 
Merger Agreement was thereafter executed in counterparts by the Company, T2,    
TSG, and Messrs. Smith and Berry. The execution of the original Resources Merger
Agreement and the original TSG Merger Agreement was announced on October 8,     
1997, by issuance of a press release by the Company.                            

    On November 4, 1997, an Amended and Restated Agreement and Plan of Merger,
dated as of October 8, 1997, was entered into by the Company, T1, Resources, and
Mr. Oates in order to amend the original Resources Merger Agreement to provide  
that the consummation of the TSG Acquisition is a condition precedent to the    
closing obligations of both the Company and Resources and to make certain       
technical                                                                       

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corrections. At a special meeting of the Tyler Board held on November 4, 1997,  
the Tyler Board unanimously approved the amendment and restatement of the       
original Resources Merger Agreement.                                            

   In late November 1997, representatives of the Company, Resources, and TSG
began discussing possible amendments of the respective Merger Agreements to     
restructure the contemplated stock option grants. The original and the amended  
and restated Resources Merger Agreement and the original TSG Merger Agreement   
respectively provided for grants of stock options by the Company to certain     
employees of Resources and TSG, and by Mr. Oates to certain employees of        
Resources, priced as of the original execution date but not effective until the 
consummation of the respective Acquisitions. The parties subsequently determined
that it would be more desirable for the Company's grants to be incentive stock  
options made at the date of consummation of the respective Acquisitions with an 
exercise price per share equal to the market value per share of the Common Stock
on that date. Mr. Oates also determined with the Company's concurrence that he  
would cause his shares of Resources common stock to be reclassified into a class
A common stock having voting rights and a non-voting, class B common stock, and 
would transfer the shares of class B common stock to certain Resources employees
in lieu of the previously contemplated option grants to purchase shares of      
Common Stock he is to receive in the Resources Acquisition. Mr. Oates completed 
the transfers in December 1997 and early January 1998. In addition, the Company,
Resources, and Mr. Oates agreed that Mr. Oates would contribute the Resources   
headquarters facility directly to T1, instead of Resources, upon closing of the 
contemplated merger.                                                            

At a special meeting of the Tyler Board held on December 12, 1997, the
Tyler Board unanimously approved the further amendment and restatement of the   
Resources Merger Agreement and the amendment and restatement of the original TSG
Merger Agreement to reflect the above described changes and authorized the      
Company's Chief Executive Officer to complete the negotiation and execution of  
the Resources Merger Agreement and the TSG Merger Agreement.                    

    The Resources Merger Agreement, as amended and restated, was approved by a
joint unanimous written consent on December 29, 1997 of the board of directors  
and shareholders of Resources.                                                  

The TSG Merger Agreement, as amended and restated, was approved by the
board of directors and shareholders of TSG by unanimous written consents on     
December 29, 1997.                                                              

  On December 29, 1997, the Resources Merger Agreement was entered into by
the Company, T1, Resources, and Mr. Oates, and the TSG Merger Agreement was     
entered into by the Company, T2, TSG, and Messrs. Smith and Berry.              

REASONS FOR THE ACQUISITIONS; RECOMMENDATION OF THE TYLER BOARD                 

    The Tyler Board has unanimously approved the Acquisitions. THE TYLER BOARD
UNANIMOUSLY RECOMMENDS TO THE STOCKHOLDERS THAT THEY VOTE FOR THE PROPOSALS TO  
ADOPT THE RESOURCES MERGER AGREEMENT AND THE TSG MERGER AGREEMENT. In           
determining to approve the Acquisitions, the Tyler Board considered, among      
others, the following positive factors:                                         

    (1) Opportunity for Revenue Growth. The Acquisitions provide the
Company with the opportunity for growth. Resources and TSG provide    
   information management solutions to approximately 200 county governments,
     principally in the Southwestern United States. The Company expects that the
Acquisitions will provide the Company with a substantial amount of    
   recurring revenues through existing agreements and long-standing customer
   relationships of Resources and TSG and additional revenues resulting from
coordinated sales and marketing of Resources' and TSG's services and  
    systems. County governments are one of the most rapidly growing government
   sectors. In addition, even though county government services are affected
    by economic downturns, services must generally be maintained at a constant
or increasing level. Service requirements generally continue to grow  
    regardless of the economy and budget constraints, thus creating additional
pressure for outsourcing and the use of cost-effective technology     
  solutions. This targeted county government information management market
  presents the opportunity for continued internal growth by both Resources
and TSG, as well as the ability to capitalize on TSG's development and
marketing of technological innovations for information management. The
Company believes that the                                             

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 county government information management market is fragmented and that,
given Resources established ability to identify suitable acquisition  
    candidates and complete acquisitions, the Company will be able to pursue a
   consolidation strategy that could also lead to significant revenue growth
    for the Company. Many of the services and systems offered by Resources and
TSG also can be marketed to municipal governments.                    

(2) Increased Profitability. The Company believes that the  
    Acquisitions will result in revenue growth and provide the opportunity for
  increased economies of scale and cost savings. These factors will assist
     the Company in fulfilling its long-term objective of increasing its overall
profitability and rewarding shareholders                              

(3) Leveraging Existing Relationships. The Company's growth 
 opportunities will be enhanced through long-standing relationships with
     county governments and agencies that have been cultivated and maintained by
Resources and TSG. These relationships will be utilized to enhance the
position of the Company in executing its consolidation strategy. The  
    Company's size and visibility, overall as a New York Stock Exchange listed
     corporation and within the information management industry after completion
    of the Acquisitions, will increase the awareness and interest of potential
acquisition candidates in the Company and the benefits of further     
consolidation.                                                        

       (4) Market Presence and Penetration. The Company intends to use the
     Acquisitions as building blocks to position itself as a leading provider of
     information management solutions to county government and related entities.
     The Company believes it will be able to increase market penetration through
expanded and coordinated marketing of Resources' and TSG's information
 management solutions. As a result of the Acquisitions, the Company will
   have both the financial resources and the market position to compete more
    effectively in the growing information management industry than any of the
Company, Resources, or TSG could do individually.                     

      (5) Complementary Businesses and Managements. The Company believes
that Resources, with its focus on outsourcing of property records     
    management, and TSG, with a broad array of systems for other applications,
  have complementary businesses and business strategies and that a natural
synergy exists between their respective services and systems. Both    
     Resources and TSG provide superior levels of service and possess compatible
  and complementary management philosophies and strategic objectives. Both
 companies have focused their marketing efforts on providing information
management solutions to county governments located primarily in the   
   Southwest. In addition, Resources and TSG have each developed proprietary
   software products for this market. The Company expects that consolidating
Resources and TSG as part of the Company and capitalizing on these    
synergies between Resources and TSG will enhance existing business    
    relationships, increase market share, promote new business generation, and
stimulate the development of additional proprietary products.         

        (6) Industry Consolidation Opportunities. The information management
   industry is fragmented, and the county government and related markets are
primarily served by small, private companies. The Company foresees    
     substantial opportunities for consolidation in the near future. The Company
believes that no single or small group of firms has significant market
share nationwide in the county government or related markets. The     
     acquisitions of Resources and TSG will position the Company to grow rapidly
    through consolidating acquisitions and give it the opportunity to obtain a
significant share of these markets. The Company intends to pursue     
 aggressively this consolidation strategy through an acquisition program
 focused on entry into new geographic markets, expansion within existing
  geographic markets, and development of related services and systems. The
Company believes there are significant opportunities to expand through
 acquisitions in geographic markets where the Company will not initially
  have a strong presence by acquiring companies that are regional leaders.
The Company believes the management teams of Resources and TSG will be
  instrumental in identifying and completing future acquisitions, and will
  supplement the substantial acquisition experience of the Tyler Board and
the Company's senior management.                                      

          (7) Continuity of Management; Management Experience. William D. Oates,
the founder of Resources, will be the Chief Executive Officer of New  
Resources and join the Tyler Board following the                      
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     consummation of the Resources Acquisition. Mr. Oates brings vast experience
in information management services to the Company, as well as a strong
 acquisition background in this area. Glenn A. Smith and Brian B. Berry,
co-founders of TSG, will also continue to manage the operations of TSG
after the closing of the TSG Acquisition, thus giving the Company the 
   benefit of their significant information management technology experience
and expertise.                                                        

          (8) Financial Performance. The Tyler Board reviewed the historical and
current financial conditions, results of operations, prospects, and   
     businesses of the Company, Resources, and TSG, both before and after giving
effect to the Acquisitions. Both Resources and TSG have achieved      
  profitability by providing information management solutions primarily to
   county governments. Resources' and TSG's historical results of operations
reflect increasing revenue growth and operating margins. The Company  
   believes financial results will be further enhanced through completion of
the Acquisitions and consolidation of Resources and TSG as part of the
Company.                                                              

         (9) Share Price and Market Value. Based on its analysis of the growth
     strategy implemented by the Company, the terms of the Acquisitions, and the
 business operations of Resources and TSG, the Tyler Board believes that
  completion of the Acquisitions will have a positive impact on the value,
and thus the price per share, of the Company's Common Stock and will  
benefit the Company's stockholders.                                   

         (10) Alternatives to the Acquisitions. The Tyler Board considered the
   effect of the Acquisitions on stockholder value compared to the impact of
    alternative growth strategies. Alternative growth strategies considered by
    the Tyler Board included, among others, expansion within existing business
    segments, start-up entry into the information management industry or other
industries, or acquisitions of other companies in the information     
  management industry or other industries. The Tyler Board determined that
the Acquisitions presented the best present opportunity for maximizing
   stockholder value and achieving the Company's other strategic objectives.

     (11) Significant Barriers to Entry. Significant barriers to entry
  exist in the information management industry. Outsourcing and purchasing
     decisions often require extensive and lengthy bidding, review, and approval
    processes. As a result, government decision makers and vendors both prefer
to enter into long-term contractual relationships, thereby avoiding   
    frequent bidding and approval delays. County governments frequently select
     single vendor solutions, employing one low-cost or total-solution provider,
    as opposed to several competing vendors for the same products or services.
   New entrants in the industry are likely to be effectively restricted from
 competition for the business of county governments and related entities
that have recognized the need for information management products or  
services, since contracts are bid infrequently or require vendors to  
   compete as low-cost or total-solution providers. In addition, significant
investments in hardware and software would be necessary for any new   
   entrant, and the lack of access to proprietary technology tailored to the
    county government and related markets would hamper such entry. The Company
  believes that the Acquisitions represent a cost-effective entry into the
information management industry. The Company may face increasing      
  competition in the information management industry, however, if existing
    and new entrants pursue consolidation strategies similar to the Company's.

          (12) Due Diligence Review. The Tyler Board reviewed the results of the
due diligence investigations of Resources and TSG conducted by the    
Company's management and its representatives.                         

 In reviewing the proposed Acquisitions, the Tyler Board also considered
other factors, some of which may be viewed as negative, including the following:

(1) Goodwill. The Acquisitions will result in the Company's 
     recognition of approximately $58.9 million of goodwill. The amortization of
     this goodwill will reduce reported earnings for the Company for an extended
period of time.                                                       

   (2) Dilution. The Acquisitions will result in the issuance of a
    substantial number of additional shares of Common Stock, which some of the
     Company's stockholders may perceive as dilutive to their existing holdings.

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       (3) Assumption of Debt; Financial Requirements. As of September 30,
  1997, the Company had no long-term or short-term debt outstanding. After
giving pro forma effect to the Acquisitions including new indebtedness
incurred to pay cash dividends and bonuses under the Resources Merger 
    Agreement, as of September 30, 1997, the Company will assume approximately
   $15.0 million of Resources' long-term debt, including the current portion
     of long-term debt. In addition, after giving effect to the Acquisitions, as
  of September 30, 1997, the Company intends to finance approximately $9.3
million of the cash consideration in the Acquisitions through new bank
 financing. Although the Company believes that cash flow from operations
    will be sufficient to service the additional debt, the additional debt may
  restrict the Company's access to other sources of debt or equity capital
   and limit future acquisition financing alternatives. In addition, the new
     bank financing will place restrictions on the ability of the Company to pay
dividends to its stockholders.                                        

     (4) Control. The Acquisitions will result in one shareholder, Mr.
Oates, owning approximately 25.8% of the outstanding shares of Common 
    Stock. As long as Mr. Oates owns a significant percentage of the shares of
   Common Stock, he may retain substantial influence over the affairs of the
Company through the election of directors and otherwise.              

       (5) Regulatory and Third Party Approvals. The proposed transactions
   are subject to regulatory and third party approvals, including compliance
   with the requirements of the Hart-Scott-Rodino Antitrust Improvements Act
    of 1976 (the "HSR Act"). Although the Company believes that such approvals
will be obtained, delays could prevent the timely closing of the      
Acquisitions and result in additional expenditures by the Company.    

      (6) Integration. The Tyler Board also considered a number of other
risks associated with the Resources and TSG Acquisitions prior to its 
approval thereof, including integration of corporate cultures and     
 organizational models and retention of key employees of both companies.

    After taking into consideration the factors described above, on October 8,
1997, November 4, 1997, and December 12, 1997, the Tyler Board unanimously      
approved the original Resources Merger Agreement and the original TSG Merger    
Agreement and the various amendments and restatements of those agreements. In   
view of the variety of factors considered in connection with its evaluation of  
the Acquisitions, the Board of Directors did not find it practicable to, and did
not, quantify or otherwise assign relative strengths to the specific factors    
considered in reaching its determination.                                       

     THE TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE
FOR THE PROPOSAL TO ADOPT THE RESOURCES MERGER AGREEMENT.                       

     THE TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE
FOR THE PROPOSAL TO ADOPT THE TSG MERGER AGREEMENT.                             

TERMS OF THE ACQUISITIONS                                                       

  The following summary of the terms and conditions of the Acquisitions as
set forth in the Resources Merger Agreement and the TSG Merger Agreement is     
intended to be a description of all material information relating to the        
Acquisitions. This summary is, however, qualified in its entirety by reference  
to the full terms of the Resources Merger Agreement and the TSG Merger          
Agreement, which are attached hereto as Appendix A and Appendix B, respectively,
and are hereby incorporated herein by reference.                                

The terms and conditions of the Resources Merger Agreement and the TSG
Merger Agreement are similarly structured. This summary describes the similar   
terms and conditions of the Resources Merger Agreement and the TSG Merger       
Agreement (which are sometimes collectively referred to herein as the "Merger   
Agreements") and, where different, the specific terms and conditions of each of 
the Merger Agreements.                                                          

Effective Time. Each Acquisition shall become effective following the 
closing thereof (the closing of each Acquisition being referred to herein as the
"Closing") when the Articles of Merger, executed in accordance with the TBCA,   
are filed with the Secretary of State of Texas or at such other time specified  
in the                                                                          

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Articles of Merger. It is anticipated that the Articles of Merger with respect  
to the Acquisitions will be filed with the Secretary of State of Texas at the   
same time or otherwise provide for the same effective time. The time each       
Acquisition becomes effective is referred to herein as the "Effective Time."    

   General Effects of the Acquisitions. At the Effective Time, (i) Resources
will merge with and into T1, which will be the surviving corporation and a      
wholly owned subsidiary of the Company, (ii) Mr. Oates will contribute the      
Resources headquarters facility in Dallas, Texas, to T1, and (iii) T2 will merge
with and into TSG, which will be the surviving corporation and a wholly owned   
subsidiary of the Company. After the Effective Time, the Articles of            
Incorporation and Bylaws of T1 in effect immediately prior to the Effective     
Time, which shall be identical to the Articles of Incorporation and Bylaws of   
Resources, shall constitute the Articles of Incorporation and Bylaws of New     
Resources. At the Effective Time, the Articles of Incorporation and Bylaws of   
TSG shall be the Articles of Incorporation and Bylaws of the surviving          
corporation of the TSG Acquisition.                                             

   At the Effective Time, the stockholders of Resources shall be entitled to
receive in the aggregate $15,250,000 in cash and 10,000,000 shares of Common    
Stock. The Class A Holder at the Effective Time will be entitled to receive     
$15,250,000 in cash (of which $5,500,000 has been allocated to the transfer of  
the Resources headquarters facility) and a total of 8,765,000 shares of Common  
Stock; the holders of Resources class B common stock at the Effective Time will 
be entitled to receive an aggregate of 1,235,000 shares of Common Stock on a pro
rata basis. In addition, the Class A Holder at the Effective Time may be        
entitled to receive additional merger consideration up to an aggregate amount of
$4,500,000 on or before December 31, 1999. See "-- Additional Consideration."   
With respect to the TSG Acquisition, all of the issued and outstanding shares of
common stock of TSG at the Effective Time shall be converted into the right to  
receive in the aggregate $12,000,000 in cash and 2,000,000 shares of Common     
Stock on a pro rata basis. Each option outstanding at the Effective Time to     
purchase shares of the common stock of TSG, which is not otherwise extinguished 
pursuant to the TSG Merger Agreement, shall be exercised prior to the Closing   
and converted into cash and shares of Common Stock as described above. No       
fractional shares of Common Stock will be issued in the Acquisitions and, in    
lieu thereof, a cash payment will be paid equal in value to any such fractional 
share based on the closing price per share of the Common Stock on the last      
trading day prior to the Effective Time. If there is any change in the Company's
capitalization, such as a stock split, stock dividend, or similar change, or a  
change in the capitalization of Resources or TSG, respectively, then the amount 
of cash to be paid and the number of shares of Common Stock per share of common 
stock of Resources and TSG will be correspondingly adjusted.                    

    After the Effective Time, upon surrender of the appropriate certificate or
certificates to the respective surviving corporation for cancellation, each     
holder of common stock of Resources or common stock of TSG shall be entitled to 
receive a certificate or certificates representing the number of shares of      
Common Stock into which such surrendered shares shall have been converted. Until
surrendered, each outstanding certificate that prior to the Effective Time      
represented shares of common stock of Resources or common stock of TSG shall    
only evidence the right to receive that amount of cash or shares of Common Stock
into which such Resources or TSG shares shall be converted.                     

    Representations and Warranties of Resources and TSG. The Merger Agreements
contain various representations and warranties of Resources and TSG and their   
respective shareholders who executed the Merger Agreements, which must be true  
and correct in all material respects at the Closing, except as otherwise        
provided in the respective Merger Agreements. The joint and several             
representations and warranties of Resources and Mr. Oates and of TSG and Messrs.
Smith and Berry include customary representations and warranties with respect to
corporate organization and authority, qualification, and capitalization. The    
Merger Agreements also contain representations and warranties by the parties    
regarding (i) compliance and absence of conflict with laws and other            
instruments, (ii) financial statements, (iii) absence of certain changes since  
July 31, 1997, for Resources, and August 31, 1997, for TSG, (iv) liabilities,   
(v) title to properties, (vi) assets, (vii) accounts receivable, (viii)         
inventory, (ix) intellectual property, (x) contracts, (xi) litigation and       
claims, (xii) compensation and benefit plans, (xiii) labor relations, (xiv)     
insurance, (xv) related party contracts, (xvi) revenue recognition, (xvii)      
broker's and finder's fees, (xviii) environmental matters, and (xix) the        
accuracy of the information furnished. The Resources Merger Agreement also      
includes representations and                                                    
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warranties of Resources and Mr. Oates in connection with the characterization of
the Resources Acquisition as a tax-free reorganization. With respect to any     
subsidiary of Resources for any periods prior to the subsidiary's acquisition by
Resources, Resources and Mr. Oates' representations and warranties are expressly
limited to their respective knowledge. Substantially all of the representations 
and warranties made by Resources and Mr. Oates and by TSG and Messrs. Smith and 
Berry survive the Closing and continue in full force and effect for two years   
thereafter. Representations and warranties with respect to taxes and            
capitalization of Resources and TSG, including representations and warranties as
to the title and percentage ownership of the shares of common stock of each of  
Resources and TSG, survive until the expiration of all applicable statutes of   
limitation.                                                                     

   Representations and Warranties of the Company. The Merger Agreements also
contain representations and warranties of the Company and T1 or T2,             
respectively. In addition to customary representations and warranties with      
respect to corporate organization and authority, qualification, and             
capitalization, the Merger Agreements contain representations and warranties by 
the Company and the respective subsidiary regarding (i) compliance and absence  
of conflict with laws and other instruments, (ii) documents filed by the Company
with the Commission, (iii) absence of certain changes since June 30, 1997, (iv) 
broker's and finder's fees, (v) litigation and claims, (vi) no interim          
operations of the respective subsidiary, and (vii) the accuracy of the          
information furnished.                                                          

    Conduct of Business. During the period prior to the Closing, Resources and
Mr. Oates and TSG and Messrs. Smith and Berry have agreed to certain affirmative
and negative covenants relating to the business of Resources and TSG,           
respectively. These parties will cause Resources and TSG to: (i) use reasonable 
efforts to conduct their respective operations in the ordinary course and       
substantially the same manner as previously conducted; (ii) maintain marketing  
organizations intact and to preserve the goodwill of their respective employees,
representatives, suppliers, and customers; and (iii) notify the Company of any  
material emergency or other change in the normal course of their respective     
businesses and of any governmental complaints, investigations, or hearings. The 
negative covenants require Resources and Mr. Oates and TSG and Messrs. Smith and
Berry, prior to the Closing, not to: (i) issue, sell, pledge, or dispose of any 
capital stock or, other than in the ordinary course of business, any assets;    
(ii) amend or propose to amend the respective charter or bylaws; (iii) split,   
combine, or reclassify any outstanding capital stock; (iv) redeem, purchase,    
acquire, or offer to acquire any outstanding capital stock of the respective    
companies or any subsidiary; or (v) enter into any contract, agreement,         
commitment, or arrangement with respect to any of these matters. In addition,   
the parties covenant that they shall take no action that would cause or permit, 
and shall not fail to use their reasonable efforts to take any action the       
failure to take which would cause or permit, their representations and          
warranties set forth in the respective Merger Agreements to become untrue in any
material respect.                                                               

    Other Covenants. Pursuant to the Resources Merger Agreement, Resources and
Mr. Oates have agreed that until the Closing, or March 31, 1998 if the Resources
Merger Agreement is terminated without closing, Resources and Mr. Oates shall   
not, either directly or indirectly through an agent, representative, or other   
person, solicit, or authorize any person to solicit, or initiate or encourage,  
directly or indirectly, any proposal for the acquisition of all or any material 
part of the capital stock, assets, or business of Resources or any of its       
subsidiaries, or for the merger, consolidation, or other combination of         
Resources or any of its subsidiaries with any other person or entity, or enter  
into any discussions or negotiations for any such proposal, or provide any      
person with information or assistance in furtherance of any such proposal.      
Resources and Mr. Oates must promptly notify the Company in writing of all such 
proposals received. The TSG Merger Agreement contains a substantially similar   
covenant of TSG and Messrs. Smith and Berry.                                    

The Resources Merger Agreement permits Resources to distribute cash   
dividends to Mr. Oates in the aggregate not exceeding $3,300,000 on or before   
the Closing. Resources is also permitted to pay employees of Resources and a    
consultant to Resources certain cash bonuses for past services rendered, which  
in the aggregate shall not exceed $2,400,000. The TSG Merger Agreement permits  
TSG to pay employees of TSG certain cash bonuses for past services rendered,    
which in the aggregate shall not exceed $200,000. Pursuant to the Resources     
Merger Agreement, Resources was permitted to incur new indebtedness prior to the
Closing to                                                                      

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the extent necessary to make the cash dividends and pay the bonuses. Resources  
paid the permitted bonuses and dividends in December 1997.                      

     Concurrently with the Closing, Mr. Oates shall contribute to T1, by special
warranty deed, the real property and fixtures that form the headquarters        
facility for Resources. The Company, Resources, and Mr. Oates have agreed that  
$5,500,000 of the cash portion of the consideration to be received by the Class 
A Holder at the Effective Time pursuant to the Resources Merger Agreement is    
allocable to Mr. Oates' contribution of the Resources headquarters facility for 
federal income tax purposes. In addition, Resources shall transfer to Mr. Oates,
subject to any indebtedness incurred thereon, the title to certain real property
not currently used in Resources' business.                                      

    The TSG Merger Agreement provides that the Company, TSG, and Messrs. Smith
and Berry may, pursuant to a written amendment, change the form of the TSG      
Acquisition to a merger of TSG with and into T2, provided such a revised form of
merger would qualify as a reorganization under Section 368 of the Internal      
Revenue Code of 1986, as amended.                                               

  The Merger Agreements also contain certain covenants of the Company. The
Company and T1 or T2, respectively, agree that all rights to indemnification    
existing in the articles of incorporation, bylaws or other organizational       
documents of Resources and TSG shall continue in full force and effect for six  
years after the Closing. The Company also agrees to obtain the absolute and     
unconditional release of all guarantees of the indebtedness of Resources and TSG
made by the respective shareholders.                                            

Loan by the Company to Resources. Pursuant to the Resources Merger    
Agreement, on December 30, 1997, the Company loaned $5,700,000 to Resources for 
working capital purposes. The loan, which is unsecured, is evidenced by a       
promissory note from Resources, bears interest at 8.5% per annum, payable       
quarterly, and matures on September 30, 1999, unless the Resources Merger       
Agreement is terminated prior to consummation of the Resources Acquisition. The 
loan matures 90 days after termination if the Resources Merger Agreement is     
terminated by the Company because of the failure of one or more conditions to   
the Company's obligations to consummate the Resources Acquisition regarding     
compliance with covenants by Resources, representations and warranties of       
Resources, delivery of an opinion of counsel of Resources, delivery of certain  
employment, confidentiality, and noncompetition agreements, approval of the     
Resources Merger Agreement by the shareholders of Resources, or the absence of  
dissenting shareholders of Resources. The loan matures 18 months after          
termination if the Resources Merger Agreement is terminated by Resources or Mr. 
Oates because of the failure of one or more conditions to Resources' obligations
to consummate the Resources Acquisition regarding compliance with covenants by  
the Company, representations and warranties of the Company, delivery of an      
opinion of counsel of the Company, or approval of the Resources Merger Agreement
by the stockholders of the Company. The loan matures one year after termination 
if the Resources Merger Agreement is terminated for any other reason.           

The loan by the Company to Resources is in replacement of certain     
indebtedness Resources was permitted to incur and have outstanding at the       
Closing.                                                                        

   Registration Rights. The Merger Agreements include the Company's grant of
certain registration rights to the Resources and TSG shareholders with respect  
to the shares of Common Stock to be received by them in the Acquisitions. The   
Resources Merger Agreement provides that on two occasions prior to October 8,   
2003, Mr. Oates may request that the Company register under the Securities Act  
the shares of Common Stock he receives in the Resources Acquisition; provided,  
however, that the number of shares to be so registered in an offering, whether  
registered on behalf of Mr. Oates, the Company or any other selling shareholder,
shall not be in the aggregate less than 3,000,000 shares. In addition, if the   
Company proposes to register any of its securities under the Securities Act at  
any time prior to October 8, 2003, Mr. Oates shall have the opportunity to      
include in such registration any of the shares of Common Stock Mr. Oates        
receives in the Resources Acquisition. These "demand" and "piggyback"           
registration rights are subject to certain restrictions and limitations. The TSG
shareholders may request the "piggyback" registration of the shares of Common   
Stock received in the TSG Acquisition in any registration of securities by the  
Company occurring within one year after the Closing.                            

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   Additional Consideration. The Class A Holder at the Effective Time may be
entitled to receive additional merger consideration up to an aggregate amount of
$4,500,000 in cash if certain contingencies set forth in a separate letter dated
as of October 8, 1997, are achieved on or before December 31, 1999. These       
contingencies relate to the acquisition of specified businesses of the same     
types currently engaged in by Resources and TSG for purposes of geographic      
expansion. Although Resources has had preliminary discussions from time to time 
with the owner or owners of these businesses regarding possible acquisition by  
Resources, Resources has not yet received any favorable response to its         
inquiries. Neither Resources nor the Company are currently in negotiations or   
have entered into any agreements with the owner or owners of these businesses.  
There can be no assurances that Resources or the Company will be able to        
consummate the acquisition of any or all of these businesses at all or on terms 
favorable to Resources and the Company.                                         

Employment Agreements. Pursuant to the Resources Merger Agreement, the
Company and Resources will enter into an employment and noncompetition agreement
with Mr. Oates (the "Oates Employment Agreement"), which is described herein    
under the caption "Interests of Certain Persons in Matters to be Acted Upon."   
The Resources Merger Agreement includes the Company's guarantee of full and     
prompt payment of all amounts that become due and payable to Mr. Oates pursuant 
to the Oates Employment Agreement. Resources and Mr. Oates have also agreed in  
the Resources Merger Agreement to use their reasonable best efforts to cause    
eight key employees or consultants of Resources to terminate their current      
employment or consulting agreements and enter into new employment,              
confidentiality, and noncompetition agreements with Resources in a form         
acceptable to the Company.                                                      

   Pursuant to the TSG Merger Agreement, the Company and TSG will enter into
an employment and noncompetition agreement with each of Messrs. Smith and Berry 
(collectively, the "TSG Employment Agreements"), which are described herein     
under the caption "Interests of Certain Persons in Matters to be Acted Upon."   
The TSG Merger Agreement includes the Company's guarantee of full and prompt    
payment of all amounts that become due and payable to Messrs. Smith and Berry   
pursuant to the TSG Employment Agreements. Messrs. Smith and Berry have also    
agreed in the TSG Merger Agreement to use their best efforts to cause seven key 
employees of TSG to terminate their current employment agreements and enter into
new employment, confidentiality, and noncompetition agreements with TSG in a    
form acceptable to the Company.                                                 

   Stock Options. Pursuant to the Resources Merger Agreement, effective upon
the Closing the Company has agreed to grant options under the Tyler Corporation 
Stock Option Plan ("Stock Option Plan") to employees of Resources designated by 
Mr. Oates for the purchase of an aggregate of 400,000 shares of Common Stock.   
Pursuant to the TSG Merger Agreement, effective upon the Closing the Company has
agreed to grant options under the Company's Stock Option Plan to employees of   
TSG designated by Messrs. Smith and Berry for the purchase of an aggregate of   
200,000 shares of Common Stock. The exercise price of the options to be granted 
by the Company will be equal to the reported closing price of the Common Stock  
on the New York Stock Exchange on the date of the Closing. The options to be    
granted by the Company will be incentive stock options, vest in five equal      
installments over five years, and have a term of ten years.                     

    Conditions to Consummation of the Acquisitions. The respective obligations
of the parties to the Merger Agreements to consummate the Acquisitions are      
subject to the satisfaction of certain joint conditions. First, all filings     
required under the HSR Act shall have been made, and all waiting periods,       
including any extension thereof, shall have expired or been waived or otherwise 
terminated. Second, no governmental agency or authority shall have instituted or
threatened in writing to institute, any action or proceeding seeking to delay,  
restrain, enjoin, or prohibit the consummation of the Acquisitions. Finally, the
respective obligations of the parties to consummate the Resources Acquisition   
are conditioned upon consummation of the TSG Acquisition.                       

The obligations of Resources and Mr. Oates to consummate the Resources
Acquisition are subject to the following conditions, any of which may be waived 
by Resources and Mr. Oates: (i) the Company shall have satisfied or complied    
with or performed all terms, covenants, and conditions of the Resources Merger  
Agreement; (ii) the representations and warranties made by the Company in the   
Resources Merger                                                                

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Agreement, the Oates Employment Agreement, and all other certificates or other  
agreements delivered by the Company shall be true and correct in all material   
respects; (iii) Resources and Mr. Oates shall have received an opinion of       
special counsel to the Company relating to the organization and good standing of
the Company, the authority of the Company to consummate the Resources           
Acquisition, and the binding effect of the Resources Merger Agreement; (iv)     
there shall have been no material adverse change in the businesses, properties, 
assets, liabilities, results of operations, or condition of the Company; (v) the
stockholders of the Company shall have approved the Resources Acquisition on or 
before March 31, 1998; (vi) the Company shall have obtained financing for the   
Resources Acquisition acceptable to the Company; and (vii) Resources and Mr.    
Oates shall have received a certificate or certificates executed by officers of 
the Company to the effect that the conditions set forth in the Resources Merger 
Agreement have been satisfied. The TSG Merger Agreement contains substantially  
similar conditions to the obligations of TSG and Messrs. Smith and Berry. The   
approval of the TSG Acquisition by the stockholders of the Company is not,      
however, a condition to TSG's obligations to consummate the TSG Acquisition.    

    The obligations of the Company to consummate the Resources Acquisition are
subject to the following conditions, any of which may be waived by the Company: 
(i) Resources and Mr. Oates shall have satisfied or complied with or performed  
all terms, covenants, and conditions of the Resources Merger Agreement; (ii) all
of the representations and warranties made by Resources and Mr. Oates in the    
Resources Merger Agreement and all certificates and other documents delivered by
Resources and Mr. Oates shall be true and correct in all material respects,     
subject to certain limited exceptions; (iii) the issuance and delivery of the   
shares of Common Stock in the Resources Acquisition shall comply with all       
securities laws; (iv) the Company shall have received an opinion of counsel to  
Resources and Mr. Oates relating to the organization and good standing of       
Resources, the authority of Resources to consummate the Resources Acquisition,  
and the binding effect of the Resources Merger Agreement; (v) there shall have  
been no material adverse change in the businesses, properties, assets,          
liabilities, results of operations, or condition of Resources, subject to       
certain exceptions; (vi) the Company and Resources shall have received all      
consents or approvals required to be obtained or necessary in connection with   
the consummation of the acquisition; (vii) the Company's stockholders shall have
approved the Resources Acquisition on or before March 31, 1998; (viii) the      
Company shall have obtained financing for the Resources Acquisition acceptable  
to the Company; (ix) certain designated Resources employees shall have entered  
into new employment, confidentiality, and noncompetition agreements with        
Resources; (x) the Company shall have received a certificate or certificates,   
executed on behalf of Resources and Mr. Oates, to the effect that all conditions
have been satisfied; (xi) the shareholders of Resources shall have approved the 
Resources Acquisition on or before January 31, 1998; and (xii) no shareholder of
Resources shall have exercised his right to dissent from the Resources          
Acquisition. The TSG Merger Agreement contains substantially similar conditions 
precedent to the obligations of the Company. In addition, the obligation of the 
Company to consummate the TSG Acquisition is subject to the consummation of the 
Resources Acquisition.                                                          

   Consummation of each of the Acquisitions is conditioned upon consummation
of the other Acquisition. If the Company's stockholders do not approve both of  
the Acquisitions, neither Acquisition will be consummated and both Merger       
Agreements will be terminated unless consummation of the other Acquisition is   
waived by the appropriate party or parties.                                     

  Indemnification. Mr. Oates has agreed to indemnify and hold harmless the
Company from and against any claims, losses, obligations, damages, demands, and 
liabilities arising from a breach by Mr. Oates of any representation, warranty, 
or covenant contained in the Resources Merger Agreement or in any other         
agreement executed pursuant thereto, other than certain customer claims (for    
which a separate procedure is set forth in the Resources Merger Agreement).     
Similarly, the Company agrees to indemnify and hold harmless Mr. Oates from and 
against any and all claims, losses, expenses, obligations, demands, and         
liabilities arising out of any breach by the Company of any representation,     
warranty, or covenant contained in the Resources Merger Agreement or any        
agreement executed pursuant thereto. Individual claims for indemnification of   
less than $37,500 may not be made by either party. Claims of $37,500 or greater 
may be made, but no claim may be pursued by the parties until the aggregate of  
all such claims exceeds $300,000. The maximum aggregate liability for           
indemnification by either Mr. Oates or the Company is $7,500,000; provided,     
however,                                                                        

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that claims made with regard to a breach of the representations as to           
capitalization and tax matters shall not be subject to these restrictions. The  
Resources Merger Agreement provides that the Company may offset against any     
payments otherwise due Mr. Oates under the Resources Merger Agreement, the Oates
Employment Agreement, or any other agreement, amounts equal to liabilities and  
costs incurred by the Company that are subject to indemnification by Mr. Oates. 
The TSG Merger Agreement contains similar indemnification provisions by Messrs. 
Smith and Berry and the Company. Individual claims for indemnification of less  
than $18,750 may not be made by either party. Claims of $18,750 or greater may  
be made, but no claim may be pursued by the parties until the aggregate of all  
such claims exceeds $150,000. The maximum indemnification liability under the   
TSG Merger Agreement is $3,000,000, subject to the same exclusions as described 
above for the Resources Merger Agreement. The TSG Merger Agreement contains no  
right of offset against future payments.                                        

  Amendment. The Merger Agreements may be amended only by an instrument in
writing signed by the parties against which enforcement of the amendment,       
modification, or supplement is sought.                                          

   Termination. The Resources Merger Agreement may be terminated at any time
on or before the Closing (i) by mutual consent of the Company and Mr. Oates,    
(ii) by the Company if there has been a material misrepresentation or breach of 
any of the representations and warranties of Resources and Mr. Oates, or if     
there has been a material failure on the part of Resources or Mr. Oates to      
comply with their obligations under the Resources Merger Agreement, (iii) by Mr.
Oates if there has been a material misrepresentation or breach of the           
representations and warranties of the Company or if there has been a material   
failure on the part of the Company to comply with any of its obligations under  
the Resources Merger Agreement, (iv) by either of the Company or Mr. Oates if   
the transactions contemplated by the Resources Merger Agreement have not been   
consummated by March 31, 1998, (v) by the Company or Mr. Oates if the conditions
precedent to their respective obligations have not been satisfied or waived, or 
(vi) by the Company or Mr. Oates if the transactions contemplated by the        
Resources Merger Agreement violate any order, decree, or judgment of any court  
or governmental body. The termination provisions of the TSG Merger Agreement are
substantially similar.                                                          

    Expenses. If the Resources Acquisition is not consummated, the Company and
Resources will each pay its own expenses incurred in connection with the        
Resources Merger Agreement and the transactions contemplated thereby.           
Notwithstanding this general statement, the Company will be obligated to pay the
actual legal, accounting, and other out-of-pocket expenses incurred by Resources
and Mr. Oates in connection with the negotiation, preparation, and execution of 
the Resources Merger Agreement, the transactions contemplated thereby, and      
Resources' due diligence examination of the Company if the Resources Merger     
Agreement is terminated (i) by the Company for any reason other than failure of 
one or more conditions to the Company's obligations to consummate the Resources 
Acquisition regarding compliance with covenants by Resources, representations   
and warranties of Resources, delivery of an opinion of counsel of Resources,    
delivery of certain employment, confidentiality, and noncompetition agreements, 
approval of the Resources Merger Agreement by the shareholders of Resources, or 
the absence of dissenting shareholders of Resources, or (ii) by Resources or Mr.
Oates for any reason other than those enumerated above as justifying termination
by the Company. Similarly, if the TSG Acquisition is not consummated, the       
Company and TSG will each pay its own expenses; provided, however, the Company  
will be obligated to reimburse Messrs. Smith and Berry for their reasonable     
out-of-pocket expenses in connection with the TSG Merger Agreement and the      
transactions contemplated thereby in an amount not to exceed $30,000 if the TSG 
Acquisition is not consummated because of the Company's failure to obtain       
financing or to consummate the Resources Acquisition. In addition, with respect 
to each of the Merger Agreements, if Tyler, on the one hand, or the shareholder 
or shareholders executing the respective Merger Agreement, on the other hand,   
discovers prior to Closing a breach of the other party's covenants or           
representations and warranties or the existence of a material adverse change,   
which is not cured prior to Closing, the discovering party is entitled to       
terminate the respective Merger Agreement and recover from the other party or   
parties to such Merger Agreement the discovering party's actual legal,          
accounting, and other out-of-pocket expenses as liquidated damages.             

Governing Law. The Merger Agreements are governed by Texas law.       

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ACQUISITION FINANCING                                                           

The Company has obtained a written commitment from NationsBank, N.A.  
("NationsBank") with respect to a senior revolving credit facility in an amount 
not to exceed $50,000,000 (the "Senior Credit Facility") to be extended to the  
Company by NationsBank, which satisfies the condition to the Closing for        
financing acceptable to the Company. The Senior Credit Facility will be utilized
to finance a portion of the cash purchase price to be paid for the Acquisitions,
to finance other acquisitions, and for working capital, capital expenditures,   
and other lawful corporate purposes. The following summary of the Senior Credit 
Facility is based on the terms set forth in the written commitment.             

  The Senior Credit Facility will have a three-year term. Interest will be
calculated based on: (i) the London Interbank Offered Rate ("LIBOR") plus the   
applicable margin of 1.00% to 2.00%; or (ii) the higher of the Federal Funds    
rate plus 0.50% or the NationsBank prime rate, plus the applicable margin of    
zero to 0.25%. The Senior Credit Facility is subject to an upfront fee of 0.625%
of the total commitment and an annual fee on the undrawn commitment ranging from
0.25% to 0.50%. The applicable margin will be determined each quarter and the   
commitment fee will be determined annually, and in each case will be based on   
the ratio of Indebtedness to Pro Forma EBITDA (each as defined in the Senior    
Credit Facility). The Senior Credit Facility will be secured by a pledge of the 
common stock of all present and future subsidiaries of the Company and will be  
guaranteed by all such subsidiaries. The Senior Credit Facility will also       
prohibit the Company and its subsidiaries from granting liens on any of their   
assets, except as expressly permitted thereunder. The Senior Credit Facility    
will include customary affirmative, negative, and financial covenants,          
including, without limitation, requirements to maintain a ratio of Indebtedness 
to Pro Forma EBITDA not greater than 3.00, a fixed charge coverage ratio to     
Historical EBITDA (each as defined in the Senior Credit Facility) of not less   
than 1.75 until March 31, 1998, 2.00 from April 1, 1998, through June 30, 1998, 
and 2.25 thereafter, and a minimum consolidated net worth of not less than the  
sum of (i) 90% of the Company's net worth as of December 31, 1997, plus (ii) 50%
of quarterly net income plus (iii) 100% of any equity proceeds. The Senior      
Credit Facility will require prior approval of NationsBank for future           
acquisitions, other than the Acquisitions, involving cash or indebtedness in    
excess of $10,000,000 individually or $30,000,000 in the aggregate. In addition,
the Senior Credit Facility will restrict the ability of the Company to pay      
dividends to its stockholders.                                                  

The Senior Credit Facility is subject to the execution of definitive  
agreements and the satisfaction of customary closing conditions. There can be no
assurance that the Company will be successful in finalizing the definitive      
agreements and obtaining the Senior Credit Facility or that, if obtained, the   
Senior Credit Facility will be on the same terms as set forth in the written    
commitment.                                                                     

HSR ACT                                                                         

  The Resources Acquisition is subject to the requirements of the HSR Act,
which provides that certain acquisition transactions may not be consummated     
until certain information has been furnished to the Antitrust Division of the   
Department of Justice ("Antitrust Division") and the Federal Trade Commission   
("FTC") and certain waiting period requirements have been satisfied. The Company
and Mr. Oates filed the required information and material with the Antitrust    
Division and the FTC on November 20, 1997, and the waiting period was terminated
early on December 2, 1997. Satisfaction of the waiting period requirement will  
not preclude the Antitrust Division, the FTC, or any other party either before  
or after the Effective Time from challenging or seeking to delay or enjoin one  
or both of the Acquisitions on antitrust or other grounds. There can be no      
assurance that such a challenge, if made, would not be successful.              

LIMITATIONS ON TRANSFERABILITY OF COMMON STOCK                                  

The shares of Common Stock to be issued in the Acquisitions will be   
unregistered securities. Such shares may not be transferred by the holders      
thereof without registration under the Securities Act and applicable state      
securities or blue sky laws or the availability of an appropriate exemption     
under the Securities Act. In addition, the shares of Common Stock received by   
certain persons deemed to be "affiliates" of the Company for purposes of Rule   
145 under the Securities Act will be subject to the restrictions imposed by such
rule. In                                                                        

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accordance with Rule 145, an affiliate of either Resources or TSG receiving     
shares of Common Stock issued in the Acquisitions may not sell such shares      
except pursuant to the volume and manner of sale limitations and other          
requirements specified therein or pursuant to an effective registration         
statement under the Securities Act. In general, directors, executive officers   
and substantial beneficial owners of a corporation's securities may be deemed to
be "affiliates" of a corporation. Pursuant to the Merger Agreements, the Company
has granted certain registration rights to the Resources and TSG shareholders.  
See "-- Terms of the Acquisitions -- Registration Rights."                      

ACCOUNTING TREATMENT                                                            

    Resources. The Resources Acquisition is expected to be accounted for under
the "purchase" method of accounting in accordance with generally accepted       
accounting principles ("GAAP") as a purchase of Resources' outstanding capital  
stock by the Company. As such, the Company will record the acquired assets      
(including identifiable intangible assets) and liabilities of Resources at their
respective fair values. The remainder of the purchase price over such fair value
will be reflected on the Company's balance sheet as goodwill.                   

    TSG. The TSG Acquisition is expected be accounted for under the "purchase"
method of accounting in accordance with GAAP as a purchase of TSG's outstanding 
capital stock by the Company . As such, the Company will record the acquired    
assets (including identifiable intangible assets) and liabilities of TSG at     
their respective fair values. The remainder of the purchase price over such fair
value will be reflected on the Company's balance sheet as goodwill.             

FEDERAL INCOME TAX CONSEQUENCES                                                 

The following discussion summarizes the material federal income tax   
consequences of the Acquisitions that are applicable to the Company. The        
discussion is based on currently existing provisions of the Internal Revenue    
Code of 1986, as amended (the "Code"), existing and proposed regulations        
promulgated under the Code by the Treasury Department, and current              
administrative rulings and court decisions, all of which are subject to changes.
Any such change, which may or may not be retroactive, could alter the tax       
consequences to the Company or its stockholders or to Resources, TSG, or their  
respective shareholders. This discussion does not address all aspects of United 
States federal income taxation that may be relevant to a particular stockholder 
of the Company, or the effects of state, local, or foreign income taxation. This
discussion also does not deal with tax consequences of the Acquisitions that may
be relevant to the shareholders of Resources or TSG.                            

     The Resources Acquisition is intended to qualify as a reorganization within
the meaning of Section 368(a) of the Code, in which case no gain or loss will be
recognized by the Company or Resources as a result of the Resources Acquisition.

The TSG Acquisition is intended to be a taxable transaction to the    
shareholders of TSG. Neither the Company nor TSG will realize any gain or loss  
as a result of the TSG Acquisition.                                             

    The TSG Merger Agreement provides that the Company, TSG, and Messrs. Smith
and Berry may, pursuant to a written amendment, change the form of the TSG      
Acquisition to a merger of TSG with and into T2, provided such a revised form of
merger would qualify as a reorganization under Section 368 of the Code.         

It is expected that at the Closing the Company will receive a written 
opinion (the "Tax Opinion") of Liddell Sapp substantially to the effect that, on
the basis of certain facts and representations, including but not limited to the
representations made in the Resources Merger Agreement and the TSG Merger       
Agreement, (i) the Company will not recognize income, gain, or loss as a result 
of the Acquisitions and (ii) no gain or loss will be recognized by stockholders 
of the Company who were stockholders of the Company immediately prior to the    
Effective Time with respect to their holdings of shares of Common Stock         
immediately prior to the Effective Time. In connection with the Tax Opinion,    
Liddell Sapp will make such factual assumptions as are customary in similar tax 
opinions. The Tax Opinion cannot be relied upon if any such factual assumption  
is, or later becomes, inaccurate. The Company has not requested, and will not   
request, a ruling from the United                                               

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States Internal Revenue Service with respect to the federal income tax          
consequences of either of the Acquisitions and the Tax Opinion will not be      
binding upon the Internal Revenue Service. Delivery of the Tax Opinion is not a 
condition to consummation of either of the Acquisitions.                        

  The foregoing summary of material federal income tax consequences is not
intended to constitute advice regarding the federal income tax consequences of  
the Acquisitions to any holder of shares of Common Stock.                       

NO APPRAISAL RIGHTS                                                             

Holders of the Company's Common Stock are not entitled to dissenting  
stockholders' appraisal rights in connection with the Acquisitions. On October  
8, 1997, Mr. Oates, then the sole shareholder of Resources approved the original
Resources Merger Agreement by written consent. On December 29, 1997, the holders
of all of the Resources common stock approved the Resources Merger Agreement by 
unanimous written consent. The shareholders of TSG unanimously approved the TSG 
Merger Agreement by unanimous written consents on October 8 and December 29,    
1997. Accordingly, no shareholders of Resources or TSG are entitled to          
dissenting shareholders' appraisal rights.                                      

COMPARISON OF RIGHTS OF HOLDERS OF STOCK                                        

 There will be no change in the rights and preferences of holders of the
Company's Common Stock as a result of the Acquisitions.                         

     Resources has one Class A Holder and 18 holders of Resources class B common
stock, and TSG has three shareholders, while the Company has approximately 3,500
stockholders of record. Holders of Resources class B common stock have no voting
rights with respect to the election of directors and other regular matters, but 
the holders of all classes of Resources common stock are entitled to vote upon  
the Resources Acquisition. Thus, while the Class A Holder and the TSG           
shareholders currently have the ability to exercise virtually complete control  
over their respective companies, their individual ability to exercise control   
over the Company will be more limited. Mr. Oates will, however, own             
approximately 25.8% of the outstanding shares of Common Stock upon consummation 
of the Resources Acquisition.                                                   

   The Class A Holder and the TSG shareholders, among other things, will not
have the ability to call special stockholder meetings, amend the Company's      
By-Laws, or control the election of directors. The charter and bylaws of each of
Resources and TSG contain provisions customary for privately held corporations  
under the TBCA. The Company's Charter and By-Laws are substantially more        
detailed and contain many provisions, such as antitakeover provisions, customary
among publicly traded corporations with many stockholders.                      

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MARKET PRICES AND DIVIDENDS 

THE COMPANY                                                                     

    The Common Stock is traded on the New York Stock Exchange under the symbol
"TYL." At December 30, 1997, the Company had approximately 3,500 stockholders of
record. The following table sets forth for the calendar periods indicated the   
high and low sales price per share of the Common Stock as reported on the New   
York Stock Exchange.                                                            

                                                                [Download Table]

                                                             HIGH     LOW     
                                                             ----     ---     
                                                                              
1995                                                                          
  First Quarter.............................................  $3 7/8   $2 3/4 
  Second Quarter............................................   3 7/8    3     
  Third Quarter.............................................   3 1/4    2 5/8 
  Fourth Quarter............................................   3 7/8    2 3/4 
1996                                                                          
  First Quarter.............................................   3        2 1/4 
  Second Quarter............................................   2 7/8    2 1/8 
  Third Quarter.............................................   2 3/4    1 3/8 
  Fourth Quarter............................................   2 1/4    1 3/8 
1997                                                                          
  First Quarter.............................................   2 3/8    1 1/2 
  Second Quarter............................................   2 1/4    2 1/2 
  Third Quarter.............................................   3 3/4    2     
  Fourth Quarter............................................   5 7/8    3 3/8 
1998                                                                          
  First Quarter (through January 16, 1998)..................   6        5 5/16

    The closing sale price for a share of Common Stock on October 7, 1997, the
last trading day preceding the announcement of the proposed Acquisitions, was   
$3.50. No cash dividends were paid on the Common Stock in 1995, 1996, or during 
the nine months ended September 30, 1997. In addition, the Senior Credit        
Facility will restrict the Company's ability to pay dividends to its            
stockholders.                                                                   

RESOURCES                                                                       

   Resources is not publicly traded and no public market exists or is likely
to be created for its capital stock. Resources has one Class A Holder and 18    
holders of Resources class B common stock and until December 1997 had not paid  
cash dividends on its capital stock. Pursuant to the Resources Merger Agreement,
Resources declared and paid a cash dividend of $3,300,000 to the Class A Holder 
in December 1997.                                                               

TSG                                                                             

   TSG is not publicly traded and no public market exists or is likely to be
created for its capital stock. TSG has three shareholders. TSG declared and paid
cash dividends on its common stock in the aggregate amount of $50,270 in the    
fiscal year ended October 31, 1996. No cash dividends were paid on TSG's common 
stock in the fiscal year ended October 31, 1995, or the fiscal year ended       
October 31, 1997.                                                               

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

The following sets forth unaudited pro forma condensed consolidated   
information for the Company. The unaudited pro forma condensed consolidated     
statement of operations for the year ended December 31, 1996 and for the nine   
months ended September 30, 1997, give effect to (i) the Acquisitions of         
Resources (including Resources' acquisition of certain assets of Holdings       
("Title Acquisition")) and TSG and (ii) the divestiture of IFS as if each had   
occurred on January 1, 1996. The unaudited pro forma condensed consolidated     
balance sheet as of September 30, 1997, has been prepared as if the Acquisitions
of Resources and TSG had occurred on September 30, 1997. There can be no        
assurances that the Acquisitions will be consummated.                           

   The unaudited pro forma condensed consolidated financial information does
not purport to present the actual results of operations or financial position of
the Company had the transactions and events assumed therein in fact occurred on 
the dates indicated, nor is it necessarily indicative of the results of         
operations that may be achieved in the future. The unaudited pro forma condensed
consolidated financial information is based on certain assumptions and          
adjustments described in the notes thereto and should be read in conjunction    
therewith. The unaudited pro forma condensed consolidated financial information 
should also be read in conjunction with the historical consolidated financial   
statements, including the notes thereto, of the Company, Resources, and TSG.    

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TYLER CORPORATION 

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(IN THOUSANDS)
(UNAUDITED) 

ASSETS

                                                        [Enlarge/Download Table]

                                                          RESOURCES                                                     
                                             ------------------------------------                              PRO FORMA
                                HISTORICAL                 PRO FORMA               HISTORICAL   PRO FORMA      COMBINED 
                                 COMPANY     HISTORICAL   ADJUSTMENTS    ADJUSTED   TSG (1)    ADJUSTMENTS      COMPANY 
                                ----------   ----------   -----------    --------  ----------  -----------     ---------
                                                                                                                        
Current assets:                                                                                                         
  Cash and cash equivalents....  $19,232      $   859       $    --      $   859     $2,816    $  (19,500)(6)  $  3,207 
                                                                                                     (200)(4)           
  Accounts receivable, net.....      216        2,311            --        2,311      1,236            --         3,763 
  Merchandise inventories......   17,693           --            --           --         --            --        17,693 
  Other current                                                                                                         
     assets....................    2,799          681           135(5)       816        492            --         4,107 
                                 -------      -------       -------      -------     ------    ----------      -------- 
                                  39,940        3,851           135        3,986      4,544       (19,700)       28,770 
Property, plant and equipment,                                                                                          
  net..........................    5,505        6,668          (506)(2)    7,193        547         4,469(6)     17,714 
                                                              1,031(3)                                                  
Intangible assets..............       --        6,689            --        6,689         --        15,911(6)     81,547 
                                                                                                   51,614(6)            
                                                                                                    7,133(7)            
                                                                                                      200(4)            
Net assets of discontinued                                                                                              
  operations...................    8,787           --            --           --         --            --         8,787 
Other assets...................    6,539          838            84(5)       922         --            --         7,461 
                                 -------      -------       -------      -------     ------    ----------      -------- 
                                 $60,771      $18,046       $   744      $18,790     $5,091    $   59,627      $144,279 
                                 =======      =======       =======      =======     ======    ==========      ======== 

                                          LIABILITIES AND SHAREHOLDERS' EQUITY                                          
Current liabilities:                                                                                                    
  Accounts payable and accrued                                                                                          
     expenses..................  $ 6,852      $ 1,718       $  (296)(3)  $ 1,422     $  527    $       --      $  8,801 
  Current portion of long-term                                                                                          
     debt......................       --        2,253           (85)(2)    2,168         --            --         2,168 
  Deferred revenue.............       --           --            --           --      1,212            --         1,212 
  Other current liabilities....    8,181          307            --          307        295            --         8,783 
                                 -------      -------       -------      -------     ------    ----------      -------- 
                                  15,033        4,278          (381)       3,897      2,034            --        20,964 
Long-term debt.................       --        7,090         5,700(4)    12,790         --         9,250(6)     22,040 
Deferred income                                                                                                         
  taxes........................    5,064           --            --           --         14         7,133(7)     12,211 
Other liabilities..............    8,617          240            --          240         --            --         8,857 
Shareholders' equity...........   32,057        6,438          (421)(2)    1,863      3,043        43,244(6)     80,207 
                                                              1,327(3)                                                  
                                                             (5,700)(4)                                                 
                                                                219(5)                                                  
                                 -------      -------       -------      -------     ------    ----------      -------- 
                                 $60,771      $18,046       $   744      $18,790     $5,091    $   59,627      $144,279 
                                 =======      =======       =======      =======     ======    ==========      ======== 

See accompanying Notes to Pro Forma Condensed Consolidated Financial Statements.
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TYLER CORPORATION 

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED) 

                                                        [Enlarge/Download Table]

                                                    RESOURCES                                                  
                                        ----------------------------------                                     
                                                       PRO                                               PRO   
                                                      FORMA                             PRO FORMA       FORMA  
                            HISTORICAL               ADJUST-                HISTORICAL   ADJUST-       COMBINED
                             COMPANY    HISTORICAL    MENTS       ADJUSTED    TSG(1)      MENTS        COMPANY 
                            ----------  ----------   -------      --------  ----------  ---------      --------
                                                                                                               
Net revenues..............   $58,172      $13,997     $2,756(8)   $16,753     $8,804     $    --       $83,729 
Costs and expenses:                                                                                            
  Cost of revenues........    33,216        7,792        376(9)     8,238      3,565          --        45,019 
                                                          70(10)                                               
  Selling, general and                                                                                         
     administrative.......    24,313        2,744         --        2,744      3,972      (1,220)(13)   30,707 
                                                                                             898(14)           
  Amortization of                                                                                              
     goodwill.............        --           --         --           --         --       1,372(15)     1,372 
  Interest (income)                                                                                            
     expense..............      (613)         388        723(11)    1,111        (69)      1,114(16)     1,543 
                             -------      -------     ------      -------     ------     -------       ------- 
                              56,916       10,924      1,169       12,093      7,468       2,164        78,641 
Income from continuing                                                                                         
  operations before                                                                                            
  taxes...................     1,256        3,073      1,587        4,660      1,336      (2,164)        5,088 
Income tax (benefit)......       454           52      1,626(12)    1,678        494        (277)(17)    2,349 
                             -------      -------     ------      -------     ------     -------       ------- 
Income from continuing                                                                                         
  operations..............   $   802      $ 3,021     $  (39)     $ 2,982     $  842     $(1,887)      $ 2,739 
                             =======      =======     ======      =======     ======     =======       ======= 
Income per share                                                                                               
  from continuing                                                                                              
  operations..............   $  0.04                                                                   $  0.09 
                             =======                                                                   ======= 
Weighted average number of                                                                                     
  common shares                                                                                                
  outstanding.............    20,145                                                      12,000(6)     32,145 

See accompanying Notes to Pro Forma Condensed Consolidated Financial Statements.

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TYLER CORPORATION 

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED) 

                                                        [Enlarge/Download Table]

                                                              RESOURCES                                                   
                                                 ------------------------------------                               PRO   
                                                              PRO FORMA                            PRO FORMA       FORMA  
                                     HISTORICAL                ADJUST-                 HISTORICAL   ADJUST-      COMBINED 
                                      COMPANY    HISTORICAL     MENTS       ADJUSTED     TSG(1)      MENTS        COMPANY 
                                     ----------  ----------   ---------     ---------  ----------  ---------     ---------
                                                                                                                          
Net revenues........................  $ 85,074     $14,729     $5,077(8)     $19,806    $11,052     $    --      $115,932 
Costs and expenses:                                                                                                       
  Cost of revenues..................    49,275       8,461      1,517(9)       9,978      5,156          --        64,409 
  Selling, general and                                                                                                    
    administrative..................    42,530       2,790        111(10)      2,901      5,054      (1,384)(13)   50,299 
                                                                                                      1,198(14)           
  Amortization of                                                                                                         
    goodwill........................     1,101          --         --             --         --       1,830(15)     2,931 
  Interest (income) expense.........      (277)        463      1,079(11)      1,542        (56)        849(16)     2,058 
  Goodwill impairment charge........    14,789          --         --             --         --          --        14,789 
  Other income and expense -- net...        --          --         --             --         11          --            11 
                                      --------     -------     ------        -------    -------     -------      -------- 
                                       107,418      11,714      2,707         14,421     10,165       2,493       134,497 
                                      --------     -------     ------        -------    -------     -------      -------- 
Income (loss) from continuing                                                                                             
  operations before taxes...........   (22,344)      3,015      2,370          5,385        887      (2,493)      (18,565)
Income tax (benefit)................    (3,037)      1,125        867(12)      1,992        339        (232)(17)     (938)
                                      --------     -------     ------        -------    -------     -------      -------- 
Income (loss) from continuing                                                                                             
  operations........................  $(19,307)    $ 1,890     $1,503        $ 3,393    $   548     $(2,261)     $(17,627)
                                      ========     =======     ======        =======    =======     =======      ======== 
Income (loss) per share from                                                                                              
  continuing operations.............  $  (0.97)                                                                  $  (0.55)
                                      ========                                                                   ======== 
Weighted average number of common                                                                                         
  shares outstanding................    19,876                                                       12,000(6)     31,876 

See accompanying Notes to Pro Forma Condensed Consolidated Financial Statements.

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TYLER CORPORATION 

NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA) 
(UNAUDITED) 

(1) The fiscal year end for TSG is October 31. Accordingly, the balance sheet 
presented for TSG is as of July 31, 1997. The historical statements of
  operations presented for TSG are for the nine months ended July 31, 1997
and the twelve months ended October 31, 1996.                         

(2) Represents the distribution of certain real property not currently used in
  Resources' business to the Class A Holder at its net book value of $506,
    less related indebtedness of $85, resulting in a charge to equity of $421.

 (3) Represents the transfer of the office building from the sole shareholder of
    Resources at its net book value of $1,031 to T1 less deferred rent expense
     related to the lease termination of $296 resulting in a credit to equity of
$1,327.                                                               

(4) Pursuant to the Resources Merger Agreement and the TSG Merger Agreement,  
    Resources may incur additional long-term debt to (i) pay a $3,300 dividend
to the Class A Holder and (ii) pay cash bonuses to employees and a    
  consultant of Resources totaling $2,400, and TSG may pay cash bonuses to
  employees of TSG totaling $200. The pro forma balance sheet includes and
 the pro forma statement of operations excludes those non-recurring cash
     bonuses described in (ii) above which may be paid prior to the consummation
of the Resources Acquisition. In addition, the pro forma statement of 
 operations excludes the 12.35 shares of class B non-voting common stock
  transferred by the Class A Holder to employees of Resources prior to the
   consummation of the merger, which will be considered compensation expense
in the preacquisition operating results of Resources, and will have no
effect on the net assets of Resources at the date of the merger.      

 (5) To record the reinstatement of existing deferred tax assets of $219 related
   to Resources changing from a C corporation to an S corporation, effective
     January 1, 1997, and then revoking its S corporation status concurrent with
the merger.                                                           

(6) The proposed Acquisitions of Resources and TSG have been accounted for    
    using the purchase method of accounting. The purchase price and allocation
of purchase price to the assets acquired and liabilities assumed are  
summarized below:                                                     

PURCHASE PRICE:                                                     

                                                                [Download Table]

                                                  RESOURCES(a)    TSG     TOTAL 
                                                  ------------  -------  -------
                                                                                
Cash.............................................   $15,250     $12,000  $27,250
Long-term debt, excluding current portion,                                      
  outstanding....................................    12,790          --   12,790
Estimated transaction costs......................     1,200         300    1,500
Fair value of common stock issued (12,000 shares                                
  at $4.0125(f) per share).......................    40,125       8,025   48,150
                                                    -------     -------  -------
                                                    $69,365     $20,325  $89,690
                                                    =======     =======  =======

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TYLER CORPORATION 

NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

ALLOCATION OF PURCHASE PRICE:                                       

                                                        [Enlarge/Download Table]

                                                               RESOURCES/                  
                         PURCHASE     RESOURCES                   TSG                      
                          PRICE      HISTORICAL      TSG      ACQUISITIONS    NET PRO FORMA
                        ALLOCATION   AS ADJUSTED  HISTORICAL   FINANCING       ADJUSTMENT  
                        ----------   -----------  ----------  ------------    -------------
                                                                                           
Current assets.........  $ 8,530       $(3,986)    $(4,544)     $(19,500)(d)    $(19,500)  
Property, plant and                                                                        
  equipment............   12,209(b)     (7,193)       (547)           --           4,469   
Intangible assets......   22,600(c)     (6,689)         --            --          15,911   
Other assets...........      922          (922)         --            --              --   
Goodwill...............   51,614(g)         --          --            --          51,614   
Current liabilities....   (5,931)        3,897       2,034            --              --   
Long-term debt.........       --        12,790          --       (22,040)(e)      (9,250)  
Other liabilities......     (254)          240          14            --              --   
Shareholders' equity...       --         1,863       3,043       (48,150)(f)     (43,244)  
                         -------       -------     -------      --------        --------   
                         $89,690       $    --     $    --      $(89,690)       $     --   
                         =======       =======     =======      ========        ========   

---------------                                                                 

  (a)  The purchase price for Resources does not include certain potential
additional consideration as the contingencies regarding such
  additional consideration are not presently determinable beyond
reasonable doubt.                                           

  (b)  This amount represents the fair value of the office building, land,
   and improvements as well as the net book value of furniture and
   equipment for Resources and TSG, which approximates fair value.

(c)  Represents the fair value of the following intangible assets:    

                                                                [Download Table]

                                                  RESOURCES     TSG       TOTAL 
                                                  ---------    ------    -------
                                                                                
Title plant (non depreciable asset).............   $13,100     $   --    $13,100
Work force (10 year and 5 year estimated lives                                  
  for Resources and TSG, respectively)..........     2,200        600      2,800
Customer list (35 year and 20 year estimated                                    
  lives for Resources and TSG, respectively)....     1,300      2,300      3,600
Software (5 year estimated life)................     1,000      2,100      3,100
                                                   -------     ------    -------
                                                   $17,600     $5,000    $22,600
                                                   =======     ======    =======

        The increase in the fair value of the title plant from the preliminary
      allocation for the July 31, 1997, acquisition is attributable to the
         bargain purchase price and the economic events that occurred subsequent
   to that date, including (i) improved relationships with customers
       following the Title Acquisition and (ii) anticipated increased demand
        for title plants and updating services resulting from the passage of a
         state constitutional amendment permitting home equity lending in Texas.

(d)  Represents cash paid from the Company to Resources and TSG and   
        estimated transaction costs totaling $28,750, net of additional bank
debt of $9,250.                                             

   (e)  Represents total long-term debt related to these Acquisitions, which
          includes $12,790 in assumed long-term debt, excluding current portion,
from Resources and $9,250 in additional bank debt.          

     (f)  Represents the issuance of 12,000 shares of common stock at an average
          price of $4.0125 per share. The average price was calculated using the
average of the closing prices of the Company's              

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TYLER CORPORATION 

NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

    Common Stock for the five consecutive trading days beginning two
         trading days prior to the public announcement by the Company of these
acquisitions.                                               

     (g)  Represents the excess purchase price over the fair value of the assets
          acquired. Including the effect of the adjustment in note (7), goodwill
is estimated at $44,715 and $14,232 for Resources and TSG,  
       respectively. Goodwill will be amortized over 40 years and 20 years
for Resources and TSG, respectively.                        

(7) To record a $7,133 deferred tax liability and related goodwill related to 
   the tax effect of the difference between the financial statement carrying
     amount and the tax basis of the acquired assets assuming a tax rate for the
Company of 35%.                                                       

(8) To give effect to the Title Acquisition as if it occurred on January 1,   
1996.                                                                 

(9) Represents the adjustments on Resources to cost of revenues for the       
respective periods:                                                   

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Title Acquisition(8).....................................     $ 846         $2,150   
Office rent expense(3)...................................      (470)          (633)  
                                                              -----         ------   
                                                              $ 376         $1,517   
                                                              =====         ======   

(10) Represents adjustments on Resources to record incremental depreciation and 
amortization expense for the respective periods are as follows:       

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Title Acquisition property and equipment (title plant is                             
  not depreciated)(8)....................................     $ 64           $ 85    
Unrelated real property(2)...............................      (14)            --    
Office building(3).......................................       20             26    
                                                              ----           ----    
                                                              $ 70           $111    
                                                              ====           ====    

(11) Adjustments on Resources to record incremental interest expense for the    
respective periods are as follows:                                    

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Title Acquisition indebtedness of $6,000 at an                                       
  approximate interest rate of 8.5%(8)...................     $295          $  506   
Dividends and management bonus aggregating $5,700 at an                              
  approximate interest rate of 8.5%(4)...................      364             485   
Office building indebtedness of $1,031 at an approximate                             
  interest rate of 8.5%(3)...............................       64              88   
                                                              ----          ------   
                                                              $723          $1,079   
                                                              ====          ======   

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TYLER CORPORATION 

NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

(12) The net adjustment to tax expense for Resources for the year ended December
     31, 1996 on the pro forma adjustments were estimated at 37%. The income tax
expense for the nine months ended September 30, 1997 represents 36% of
  pre-tax pro forma income. Resources changed from a C corporation to an S
 corporation status effective January 1, 1997. These adjustments were to
     adjust from an S corporation to C corporation status for federal income tax
purposes.                                                             

(13) Represents lower compensation expense for management subsequent to the     
   acquisition of Resources and TSG. Amounts have been determined based upon
specific employees' revised employment agreements.                    

(14) Adjustments to depreciation and amortization expense for the respective    
periods are as follows:                                               

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Office building and improvements.........................     $ 84          $  112   
Amortization of intangible assets other than goodwill....      834           1,112   
                                                              ----          ------   
                                                               918           1,224   
Less: Resources adjustments(10)..........................      (20)            (26)  
                                                              ----          ------   
                                                              $898          $1,198   
                                                              ====          ======   

(15) Amortization of goodwill is calculated as follows:                         

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Resources................................................    $  838         $1,118   
TSG......................................................       534            712   
                                                             ------         ------   
                                                             $1,372         $1,830   
                                                             ======         ======   

(16) Interest expense is calculated as follows:                                 

                                                        [Enlarge/Download Table]

                                                           NINE MONTHS               
                                                              ENDED       YEAR ENDED 
                                                          SEPTEMBER 30,  DECEMBER 31,
                                                              1997           1996    
                                                          -------------  ------------
                                                                                     
Long-term debt outstanding, including current portion....    $24,208       $24,208   
                                                             =======       =======   

Interest expense at 8.5%.................................    $ 1,543       $ 2,058   
Less: Company historical, Resources pro forma and TSG                                
  historical interest expense and income.................        429        (1,209)  
                                                             -------       -------   
                                                             $ 1,114       $   849   
                                                             =======       =======   

(17) Represents tax expense (benefit) related to adjustments to selling, general
  and administrative expenses, which is offset by higher interest expense,
based on an effective tax rate of 35%.                                

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MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OF RESOURCES

The following discussion should be read in conjunction with the       
consolidated financial statements, including the notes thereto, and other       
financial information of Resources appearing elsewhere in this Proxy Statement. 

GENERAL                                                                         

  Resources was formed by the Class A Holder in 1993 to serve as a holding
company. On December 1, 1994, Resources acquired GRS, its largest subsidiary,   
and other business interests from American Title Group, Inc. ("American Title").
The Class A Holder had a non-controlling interest in American Title at the time 
of the acquisition.                                                             

 The results of operation for Resources for the years ended December 31,
1996, 1995 and 1994, are generally not comparable because of the impact of the  
acquisition of the property records services business and government information
services business in Texas and the surrounding states from Holdings in September
1995 combined with the 1995 dispositions by Resources of its ballot card        
production business and property tax information business. In addition,         
Resources acquired the title services division of Holdings on July 31, 1997, and
began providing title services to title insurance companies throughout Texas,   
principally in the Dallas-Fort Worth metropolitan area.                         

     Effective January 1, 1997, Resources converted from a C corporation to an S
corporation for U.S. federal income tax purposes. The S corporation status will 
be terminated on December 31, 1997.                                             

NINE MONTHS ENDED SEPTEMBER 30, 1997, COMPARED TO NINE MONTHS ENDED SEPTEMBER   
30, 1996                                                                        

 Total revenues increased $3.0 million, or 27%, to $14.0 million for the
nine months ended September 30, 1997, compared to $11.0 million for the same    
period of the prior year. Services revenues increased $3.5 million, or 36%, to  
$13.3 million for the 1997 period compared to $9.8 million for the first nine   
months of 1996 due primarily to the increase in revenues from re-creation       
services. Re-creation services revenues increased to approximately $2.7 million 
during the nine months ended September 30, 1997, from approximately $900,000    
during the same period of the prior year, due primarily to revenues arising from
the introduction of a new service providing for the enhancement and duplication 
of old photostat books maintained by county governments. Services revenues for  
the nine months ended September 30, 1997, included total post-acquisition title 
plant update services revenues of $900,000 for August and September 1997.       
Revenues generated from the digital conversion of old county government records 
increased almost $400,000 in the 1997 period when compared to the first nine    
months of 1996. The remaining increase in services revenues was due primarily to
an increase in the base of customers and the services provided, including an    
increase in revenues from services provided to appraisal districts.             

   Equipment sales decreased to $192,000 for the nine months ended September
30, 1997, from $734,000 during the same period of the prior year. The first nine
months of 1996 included approximately $500,000 in revenues derived from the sale
of computer equipment to the State of Louisiana for a voter signature           
verification system.                                                            

    Total cost of revenues increased $1.5 million, or 25%, to $7.8 million for
the nine months ended September 30, 1997, compared to $6.2 million for the same 
period of the prior year. The increase in cost of revenues corresponds to the   
increase in services revenues partially offset by the decrease in equipment     
sales. The cost of services, as a percentage of services revenues, decreased    
slightly from 58% to 57%. The cost of equipment decreased nearly $400,000, or   
68% during the first nine months of 1997. The first nine months of 1996 included
higher cost of equipment due to the inclusion of costs related to the computer  
equipment sale to the State of Louisiana.                                       

  The gross margin for the nine months ended September 30, 1997, increased
slightly to 44% from 43% compared to the same period of the prior year.         
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   Selling, general, and administrative expenses increased $680,000, or 33%,
to $2.7 million during the nine months ended September 30, 1997, compared to    
$2.1 million for the same period of the prior year. The increase is due         
principally to higher compensation expenses together with increased legal and   
professional fees incurred primarily to support unsuccessful efforts to pass    
state legislation that would have required the collection of additional filing  
fees at the county government level to be used for the restoration and          
preservation of old county records.                                             

Income before income taxes was $3.1 million for the nine months ended 
September 30, 1997, compared to $2.4 million for the same period of the prior   
year. The $700,000, or 29%, increase reflected the higher level of revenues     
during the first nine months of 1997. The effective tax rate decreased to 2% for
the nine months ended September 30, 1997, compared to 37% for the first nine    
months of 1996 due primarily to the conversion of the tax status of Resources   
for U.S. federal income tax purposes from a C corporation to an S corporation,  
effective January 1, 1997.                                                      

1996 COMPARED TO 1995                                                           

  Total revenues increased $7.2 million, or 95%, to $14.7 million for 1996
compared to $7.5 million for 1995 due primarily to the inclusion of revenues    
attributable to the property records services and government information        
services business acquired from Holdings in September 1995. Revenues from       
services provided to county governments overall for 1996 increased approximately
$6.3 million, or 90%, over 1995 principally as a result of the 1995 acquisition 
combined with certain price increases. This increase was only partially offset  
by the decline in revenues in 1996 due to the 1995 dispositions of the ballot   
card production business and the property tax information business.             

   Equipment sales nearly tripled, from $268,000 in 1995 to $792,000 in 1996
due to the computer equipment sale to the State of Louisiana.                   

     Royalties income derived from the sale of property tax information for real
estate transactions more than doubled, from $273,000 in 1995 to $623,000 in 1996
due to the receipt of royalties for a full twelve months in 1996 versus only the
last six months of 1995.                                                        

    Total cost of revenues increased $2.4 million, or 39%, to $8.5 million due
primarily to the higher level of revenues attributable to the business acquired 
from Holdings in September 1995. Cost of services as a percentage of services   
revenues decreased to 59% from 85% due to the increase in revenues resulting    
from the business acquired from Holdings without a corresponding increase in    
costs associated with services revenues. Contributing to the increase in total  
cost of revenues was a $450,000 increase in cost of equipment due to the        
computer equipment sale to the State of Louisiana.                              

   Interest expense, net of interest income, increased $306,000 to $463,000,
almost tripling from the $157,000 incurred in 1995 due to (i) a full year's     
interest expense related to the $1.7 million of promissory notes issued Holdings
in connection with the 1995 acquisition and (ii) higher average debt outstanding
during 1996 for working capital purposes.                                       

   Income from continuing operations was $3.0 million for 1996 compared to a
loss of $1.4 million for 1995, reflecting a positive turnaround of $4.4 million.
The improvement in income was primarily attributable to the increase in revenues
relating to the business acquired from Holdings in September 1995 less the      
related increases in operating expenses and depreciation and amortization       
expense. The improvement was further offset by an increase in interest expense  
associated with the promissory notes issued in connection with the acquisition. 
The effective tax rates for 1996 and 1995 were approximately 37% and 32%,       
respectively, with the 1996 rate reflecting the net effect of state income taxes
on taxable income reportable in 1996.                                           

   In 1995, Resources elected to discontinue and sold operations relating to
certain lines of business, including (i) the production of ballot cards for     
elections and (ii) the production of property tax information for real estate   
transactions. Resources recorded a net loss from discontinued operations of     
$83,000 in 1995.                                                                

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1995 COMPARED TO 1994                                                           

     The following discussion compares financial information for all of calendar
year 1994, including the historical operating results of GRS, prior to its      
acquisition by Resources on December 1, 1994.                                   

 Total revenues increased $2.7 million, or 55%, to $7.5 million for 1995
compared to $4.9 million for 1994 due primarily to the inclusion of services    
revenues in 1995 attributable to the property records services and government   
information services business acquired from Holdings in September 1995.         

Equipment sales of $268,000 in 1995, compared to no equipment sales in
1994, accounted for approximately 10% of the increase in total revenues.        

     Royalties income derived from the sale of property tax information for real
estate transactions was $273,000 in 1995 compared to no royalties income in     
1994. This income also accounted for approximately 10% of the increase in total 
revenues and was earned and recorded during the last half of 1995.              

Cost of revenues increased $2.7 million, or 79%, to $6.1 million due  
primarily to the higher level of service revenues attributable to the business  
acquired from Holdings in 1995. Costs of equipment of $137,000 relates to the   
equipment sales of $268,000 in 1995.                                            

 Selling, general and administrative expenses increased $1.2 million, or
75%, to $2.7 million due primarily to a higher level of expenses combined with  
transitional costs associated with the successful integration in 1995 of the    
property records services and government information services business acquired 
from Holdings.                                                                  

     Interest expense, net of interest income, increased $124,000 to $157,000 in
1995 compared to $33,000 in 1994. The substantial increase in 1995 is           
attributable to (i) a partial year's interest expense related to the $1.7       
million of promissory notes issued to Holdings in connection with the 1995      
acquisition and (ii) higher average debt outstanding during 1995 for working    
capital purposes.                                                               

   Income from continuing operations reflects a loss of $1.4 million in 1995
compared to a loss of $93,000 in 1994. The higher loss is attributable to the   
higher overall costs and expenses incurred during 1995 associated with the      
business acquired from Holdings. The effective tax rates for 1995 and 1994 were 
approximately 32% and 33%, respectively.                                        

   In 1995, Resources elected to discontinue and sold operations relating to
certain lines of business, including (i) the production of ballot cards for     
elections and (ii) the production of property tax information for real estate   
transactions. Resources recorded a net loss from discontinued operations of     
$83,000 in 1995 compared to income from discontinued operations of $423,000 in  
1994.                                                                           

SEASONALITY                                                                     

 Because the volume of real estate transactions is greater from February
through October, revenues from property records services are somewhat seasonal. 
In addition, certain economic and other factors that affect real estate sales in
its market area or nationwide may affect Resources' revenues in a similar       
fashion.                                                                        

LIQUIDITY AND CAPITAL RESOURCES                                                 

    At September 30, 1997, Resources had cash and cash equivalents of $859,000
compared to $247,000 at December 31, 1996. Working capital deficit was $427,000 
at September 30, 1997, compared to a working capital deficit of $558,000 at     
December 31, 1996. The increase in cash at September 30, 1997 is generally due  
to the prepayment of two promissory notes receivable (the "TRW Notes") totaling 
$938,000. The TRW Notes, which originally totaled $1,250,000 upon issuance by   
TRW/REDI Property Data to Resources on June 1995 in connection with the purchase
of Resources' property tax information business, were being amortized by equal  
quarterly payments of principal plus interest through July 1, 2000. There was no
prepayment penalty.                                                             

  Net cash provided by operating activities was $3.1 million for the first
nine months of 1997 compared with $1.8 million provided by operating activities 
in the same period of 1996. The increase was primarily due to the $1.5 million  
increase in net income. Such increase in net income reflected a $700,000        
increase in pretax                                                              
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income coupled with $800,000 reduction in income tax expense due to the         
conversion from a C corporation to an S corporation, effective January 1, 1997. 

     Net cash provided by (used in) investing activities increased approximately
$1.4 million to $49,000 for the first nine months of 1997 compared to $1,384,000
used in investing activities for same period in 1996. The increase was primarily
due to the collection of the TRW Notes discussed above, combined with a $700,000
reduction in capital expenditures during the first nine months of 1997 compared 
to the same period of 1996.                                                     

    Net cash used in financing activities increased approximately $1.8 million
to $2.6 million during the first nine months of 1997 compared to $800,000 for   
the same period of 1996. The increase is principally attributable to the        
repayment of borrowed funds from (i) Comerica Bank-Texas ("Comerica") in the    
amount of $900,000 and (ii) FirstBank in Dallas ("FirstBank") in the amount of  
$500,000. The remaining portion of the increase related primarily to payments   
made on notes payable to Holdings. The loan from Comerica had been secured by a 
pledge of the TRW Notes that were prepaid in January 1997. The prepayment of the
TRW Notes required the repayment of the Comerica loan. The $500,000 payment to  
FirstBank represented the repayment of the amount outstanding under a revolving 
credit facility.                                                                

   In November 1995, Resources entered into a revolving credit facility with
FirstBank providing for borrowings of up to $500,000. In April 1996, Resources  
entered into an amended agreement that provides for borrowings of up to $1.0    
million. The credit facility matured on April 10, 1997, and was renewed.        
Borrowings under the amended credit facility are now due on April 19, 1998, and 
bear interest at Bank One Texas N.A.'s prime rate. The amended agreement        
contains various financial covenants and is secured by certain assets of        
Resources. There was no amount outstanding under the credit facility at         
September 30, 1997.                                                             

In December 1995, Resources borrowed $2.5 million from Comerica       
collateralized by certain assets of Resources. The borrowed funds were used for 
working capital and capital expenditures. The notes bear interest at Comerica's 
prime rate plus 0.5% per annum and are payable monthly. The outstanding         
principal balance was approximately $1.4 million at September 30, 1997.         

At September 30, 1997, Resources had seller-financed acquisition debt 
outstanding in the total amount of approximately $7.9 million. This outstanding 
amount reflected the issuance by Resources, on July 31, 1997, of a $6.0 million 
promissory note to Holdings in connection with the acquisition by Resources of  
Holdings' title services division. This note is collateralized by certain assets
of Resources.                                                                   

Resources likely will be required to arrange borrowings in addition to
those available under its credit facility to fund the payment of the employee   
bonuses and shareholder dividends permitted by the Resources Merger Agreement.  
Otherwise, Resources' management believes that available cash, together with    
cash generated from operations and available borrowings under its credit        
facility, will provide adequate funds for Resources' anticipated needs,         
including working capital and capital expenditures. Management also believes    
that cash provided from operations will be sufficient to satisfy all existing   
debt obligations as they become due.                                            

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MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OF TSG

   The following discussion should be read in conjunction with the financial
statements, including the notes thereto, and other financial information of TSG 
appearing elsewhere in this Proxy Statement.                                    

OVERVIEW                                                                        

TSG commenced operations in 1981 to serve the integrated information  
management requirements of county and local governments. Since inception, net   
sales for TSG have increased from $130,000 in fiscal 1981 to $11.6 million in   
fiscal 1997.                                                                    

  TSG's revenues are derived from the sales and service of a wide range of
products to serve the automation needs of local government clients, including   
appraisal districts, tax offices, courtrooms, jails, sheriff departments, and   
financial/administrative offices. Approximately 33% of revenues represents      
annual recurring revenues from service contracts with existing customers. Future
revenues can be achieved through obtaining new customers as well as selling     
additional products or upgraded products to existing customers.                 

   The primary operating expenses incurred by TSG are costs of equipment and
labor related to the sale and installation of systems and the costs of providing
additional services. TSG typically reinvests 8% to 10% of its revenues for costs
related to the development of new products, enhancements, and maintenance of    
existing products.                                                              

TSG's fiscal year ends on October 31.                                 

FISCAL 1997 COMPARED TO FISCAL 1996                                             

     Total revenues during the fiscal year ended October 31, 1997, totaled $11.6
million, a 5% increase from $11.1 million in the fiscal year ended October 31,  
1996. This increase in revenues was primarily due to higher service and support 
revenues. Service revenues continue to increase due to more systems being sold  
to an expanding customer base and additional services being provided to existing
customers.                                                                      

     Although service and support revenues increased, cost of revenues decreased
$588,000 to $4.6 million in fiscal 1997 compared with $5.2 million in fiscal    
1996. This decrease improved the gross margin to 61% during fiscal 1997 compared
with 53% for fiscal 1996. The decrease in cost of revenues was due to lower     
service and support labor as well as lower costs for computer hardware.         

    Selling, general, and administrative expenses increased $259,000 or 5%, to
$5.3 million during fiscal 1997, compared with $5.1 million during fiscal 1996, 
due primarily to higher management and administrative personnel payroll related 
costs.                                                                          

 TSG's net income was $1.1 million for the fiscal year ended October 31,
1997, compared with $547,000 for the fiscal year ended October 31, 1996, an     
increase of $572,000. The increase in net income was primarily due to higher    
revenues and favorable sales margins during fiscal 1997.                        

FISCAL 1996 COMPARED TO FISCAL 1995                                             

     Total revenues during the fiscal year ended October 31, 1996, totaled $11.1
million, a 2% increase from $10.8 million in the fiscal year ended October 31,  
1995. This increase in revenues was primarily due to an increase in service and 
support revenues. Decreases in software license fees and hardware sales of      
$202,000 and $190,000, respectively, were more than offset by a $651,000        
increase in service and support revenues, reflecting a shift toward greater     
demand for services and an expansion of the customer base.                      

   Although revenues increased, cost of revenues decreased $572,000, or 10%,
to $5.2 million in fiscal 1996 from $5.7 million in fiscal 1995. This decrease  
improved the gross profit margin to 53% during fiscal 1996 compared with 47% for
fiscal 1995. The decrease in cost of revenues is attributable to a shift in     
higher margin services coupled with a slight reduction in staffing levels.      

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    Selling, general, and administrative expenses remained virtually unchanged
at $5.1 million in fiscal 1996, compared to $5.0 million in fiscal 1995, while  
declining slightly as a percentage of revenues (from 47% in fiscal 1995 to 46%  
in fiscal 1996).                                                                

   TSG's net income was $547,000 for the fiscal year ended October 31, 1996,
compared with $26,000 for the fiscal year ended October 31, 1995, an increase of
$521,000. The increase in net income was primarily due to higher service and    
support revenues and favorable sales margins during fiscal 1996.                

LIQUIDITY AND CAPITAL RESOURCES                                                 

At October 31, 1997, TSG had cash and cash equivalents of $2.8 million
compared with $1.8 million at October 31, 1996. Working capital was $2.5 million
at October 31, 1997, compared with $2.1 million at October 31, 1996.            

   TSG generated cash from operating activities of $1.7 million and $681,000
during the fiscal years ended October 31, 1997 and 1996, respectively. Capital  
expenditures totaled $194,000 and $230,000 during fiscal 1997 and 1996,         
respectively.                                                                   

     On January 31, 1997, TSG terminated The Software Group, Inc. Employee Stock
Ownership Plan ("ESOP") by redeeming 89,818 shares of TSG's common stock at a   
value of $5.00 per share. The termination of the ESOP reduced cash and cash     
equivalents by $449,000 during the fiscal year ended October 31, 1997.          

TSG believes that available cash, together with cash generated from   
operations, will provide adequate funds for TSG's cash requirements, including  
working capital and capital expenditures.                                       

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INFORMATION CONCERNING RESOURCES AND TSG

OVERVIEW                                                                        

County and local governments have recognized the value of information 
management services and systems to improve revenue collection, provide increased
access to information, and streamline delivery of government services. As a     
result, information management services and systems have become primary vehicles
for county and local governments, and their respective agencies, seeking to     
improve the delivery of goods and services to their constituents. From          
integrated tax systems to integrated criminal justice information systems, many 
county and local governments have benefitted significantly from the             
implementation of jurisdiction-wide systems. These systems allow different      
agencies to share data and provide a more comprehensive approach to information 
management. Individual county and local government agencies also have           
information management requirements, many of which must be tailored to the      
services being provided. The annual expenditure by county governments for       
information technologies and resources, excluding personnel costs, was estimated
in 1992 at over $23 billion, with approximately $10 billion spent annually on   
information management services and data processing.                            

     County governments were created over three centuries ago primarily to serve
the needs of rural areas. Today, county governments are the fastest growing form
of government. There are over 3,000 county governments in the United States,    
plus 30 city-county governments, and county governments are experiencing growth 
in expenditures estimated at approximately 5% to 10% per year. Texas, with 254  
counties, has the largest number of any state. Overall spending by county       
governments nationwide increased dramatically from approximately $115 billion in
the fiscal year ended in 1989 to approximately $148 billion in the fiscal year  
ended in 1992.                                                                  

     Traditionally, counties performed state-mandated duties, including property
assessment, record keeping (i.e., property and vital statistics), road          
maintenance, administration of election and judicial functions, and the         
provision of welfare assistance. Today, a host of emerging and urgent issues are
confronting counties, each of which demands a service response. These areas     
include solid waste disposal, clean air and water, transportation, criminal     
justice and corrections, administration and finance, public safety, health and  
human services, and public works. Transfers of responsibility from the federal  
and state governments, while empowering county and local governments to address 
issues and problems directly, also place additional service and financial       
requirements on these governmental units. In addition, county governments are   
typically comprised of numerous individual agencies, each fulfilling different  
missions and each having its own information management requirements.           

RESOURCES                                                                       

Overview                                                                    

Resources provides a wide range of information management outsourcing 
services, primarily to county and local governments. Resources' current         
outsourcing services include records management, micrographic reproduction,     
computerized indexing, and imaging of real property records maintained by county
clerks and recorders, the largest component of its business, as well as         
information management outsourcing and professional services required by other  
county and local government units and agencies. Resources also provides title   
plant update services to title companies in Texas.                              

    Resources' primary emphasis since its inception has been supplying records
management, document workflow, and imaging products and services to county clerk
and district clerk offices in Texas. Resources is, however, currently expanding 
its property records management services business to Cook County, Illinois, as a
result of a recent agreement with the Cook County, Illinois recorder's office   
and intends to expand aggressively its businesses into other geographic regions,
either by acquisition or internal growth. See "-- Competition."                 

 Mr. Oates formed Resources as a Texas corporation in 1993 to serve as a
holding company to acquire businesses that provide information management       
outsourcing services to local and county governments. In December 1994,         
Resources acquired GRS, its subsidiary that provides property records management
services, and other business interests from American Title in connection with   
the sale of that title insurance holding                                        
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company to an unaffiliated party. GRS was founded in 1990 by four current       
Resources employees each of whom has worked in the government services business 
for over 20 years. These key employees have long-term, established relationships
with Resources' customers and GRS has strong name recognition in Texas among    
county and local governments. See "-- Sales, Marketing, and Customers." In      
August 1995, Resources acquired the business and assets of a company that       
provides government information services to tax appraisal districts in Texas. In
September 1995, Resources acquired the government outsourcing services business 
of Holdings in Texas, Oklahoma, Louisiana, and New Mexico, making it the largest
provider of those services in Texas. In conjunction with that transaction,      
Resources sold to Holdings a government records services operation in Georgia   
and the surrounding states and an election voting card printing operation. On   
July 31, 1997, Resources acquired the title services division of Holdings and   
began providing title services to title insurance companies throughout Texas,   
principally in the Dallas-Fort Worth metropolitan area.                         

Property Records Services                                                   

 County and local governments are responsible for recording and indexing
real property transactions, maintaining archival copies of the filed documents, 
and making those records available for public inspection and copying.           
Historically, these governmental units have used manual methods to record deeds 
and other title documents and to maintain alphabetical indexes of transactions. 
Resources provides microfilm and optical recording and computer indexing        
services to county and local governments (primarily county clerk and recorder   
offices) to organize and automate the recording and indexing of deeds and other 
title documents. Many of the records that are filed in a county clerk's office  
are permanent records that form the basis of land ownership in the county (e.g.,
deeds, deeds of trust, liens, miscellaneous property records, and plats).       
Therefore, in addition to being accessible to the public, these records must be 
protected by a fail-safe backup procedure in the event of vandalism, fire, or   
flood. These records are recorded by making paper copies, microfilm copies, or  
imaging. Each record filed in the county clerk's or recorder's office pertaining
to a parcel of land in the county is recorded in one of these methods and a     
county may have used different methods over time. In addition, these documents  
vary by county and within a county as to shape, size, quality, and legibility.  

   Recording Services. Resources' archival print recording service creates a
high-quality film image of original documents on a custom-designed microfilm    
camera owned by Resources and located in county offices. Either Resources or    
trained county government personnel film the valuable records in a format       
suitable for creating a two-sided paper copy. The film is then processed in     
Resources' Kodak(R)-certified laboratory and printed double-sided on archive    
quality, rag content paper using high fusing temperatures to permanently bond   
the print to the paper. The finished pages are then returned to the county to be
placed in binders for public access and use. The original microfilm is stored in
the Resources' archival film storage vault allowing Resources to access the     
microfilm and reproduce pages on short notice or reproduce entire volumes in the
event of a natural or other disaster resulting in a destruction or loss of      
records.                                                                        

Resources' 20/20 Perfect Vision System allows an imaging system to be 
integrated with an indexing application as well as a cashiering system. This    
system is designed to manage the document workflow in the county clerk's or     
county recorder's office. The imaging, indexing, and cashiering applications can
stand alone, but are more powerful when integrated because of shared information
across the applications.                                                        

    Indexing Services. In order to provide better service to the public and to
increase the ease of information access, many county clerk offices maintain     
their grantor/grantee (i.e., buyer/seller) indices for property records in      
computerized form. To accomplish this, information relating to the grantor,     
grantee, and property description must by keyed into a database from the        
recorded documents.                                                             

  Resources provides two types of computerized indexing services: (i) data
entry performed by Resources personnel at a central location, allowing the      
county either to reduce the number of employees required for records management 
or to utilize employees on other tasks; and (ii) to a lesser extent, data entry 
performed by a customer using Resources' microcomputers in the customer's       
offices. With each type of indexing service, Resources provides periodic merged 
updates of the cumulative grantor/grantee indices for each county, using        
centralized computer and software systems located in Dallas, Texas.             

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Resources has a large staff of qualified and well-trained data entry  
operators specializing in creating consistent, quality indices. Based on its    
property records experience, Resources believes that accuracy and consistency   
are the keys to a reliable index. Resources requires its personnel to adhere to 
strict data entry standards. Accuracy is ensured by having each document entered
twice in a process called "key verification" in which two operators separately  
key the same information from a document and any discrepancies between the      
entries are then verified both visually and by means of several computerized    
edits.                                                                          

     As discussed above, the indexing application can be integrated with imaging
and cashiering applications through Resources' 20/20 Perfect Vision System to   
manage the document workflow in the county clerk's or county recorder's office. 

   Re-creation Services. Resources also provides record re-creation services
to a number of customers. These services provide image-enhanced,                
archival-quality reprints of old records, including photostatic prints, with    
microfilm backup copies for improved security in case of loss by fire, theft,   
water damage, or other catastrophe.                                             

Other Services                                                              

Resources provides information management outsourcing and professional
services to numerous units and agencies of county and local governments other   
than county clerks and recorders. These services concentrate on establishing and
maintaining a recurring revenue base built upon a foundation of quality service.

     Information Management Outsourcing Services. Information is a critical part
of government, and the increasing difficulty of effectively managing that       
information has caused many governmental units to consider outsourcing          
alternatives. Through its information management outsourcing services, Resources
provides direct and complete facilities management of a county or local         
government's financial, judicial, law enforcement, personnel, tax, clerical, and
administrative information by, in effect, becoming its information systems      
department. Typically negotiated under a multi-year contract, outsourcing       
provides a government entity with a more reliable method of controlling its data
processing budget while receiving greater automation benefits. Outsourcing also 
typically results in controllable, long-term relationships with customers and   
recurring annual revenues for Resources.                                        

   Under a typical outsourcing services contract, Resources assumes the role
of a customer's information systems department during the term of the contract. 
In addition to operating and maintaining all centralized systems, Resources also
assumes responsibility for local area networks, client/server systems, and      
personal computers, which often involve multiple users in multiple offices.     
Software applications are also integrated for the benefit of the customer.      
Resources' employees may either perform these services from Resources' Dallas,  
Texas, office or from the customer's facilities, providing essentially the same 
function as the customer's former in-house information systems personnel. Also, 
Resources' management personnel become part of a strategic planning committee   
along with the customer's representatives to set the goals and objectives to be 
achieved during the contract.                                                   

 Professional Services. Resources also provides professional services to
appraisal districts, counties, cities, and school districts. Under a            
professional services agreement, Resources provides a variety of hardware and   
specialized software for the customer's use to assist these government entities 
in automating their property tax appraisal, assessment, and collections, and    
voter registration processing. In addition to installing Resources' products in 
the customer's locations, training, maintenance, and support are provided on an 
ongoing basis along with optional services, including laser printing of tax     
rolls, appraisal rolls, and voter certificates, media conversions, and data     
entry activities. Resources receives monthly services fees from customers for   
the use of these systems, resulting in recurring annual revenues.               

Title Plant Services                                                        

   Title companies in Texas are required to maintain extensive files of real
property data called "title plants." Title plants contain the information needed
to perform title searches in order to underwrite title insurance policies. In   
Texas, a title plant must include at least a 25-year history of all land        
transactions and                                                                

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documents affecting each lot and tract of land in a particular county, which    
must be indexed so that the transactions and documents can be searched by       
reference to the lot or tract.                                                  

Resources provides certain title insurance companies, primarily in the
Dallas-Fort Worth metropolitan area, with a variety of title plant update       
services, including providing daily updates of their title plants. These updates
are offered in various formats, ranging from paper copies of each deed, deed of 
trust, lien, plat, or other title document to installation of                   
microcomputer-based title plant storage products in the customer's office.      
Resources owns title plants for Collin, Denton, Rockwall, and Tarrant Counties  
in Texas, and may from time to time sell copies of these title plants to title  
companies or other firms that need title search capabilities.                   

     A recently approved Constitutional amendment in Texas, which permits second
liens on homes to secure general home equity loans, is expected to result in    
increased demand for title plant services.                                      

Sales, Marketing, and Customers                                             

Resources markets its services through its direct sales and marketing 
personnel. Resources typically enters into long-term contracts with larger      
governmental units and title companies. Although most Resources customers are   
small and do not have long-term contracts, they have long-term, continuing      
relationships with Resources and its sales and marketing personnel. Many of     
Resources' county government customers and title plant customers have been      
served by Resources and its predecessors for more than 20 years, with some      
customers dating back to 1962.                                                  

   No single customer accounted for 10% or more of Resources' total revenues
in 1996 or the first nine months of 1997. The five largest customers of         
Resources accounted for a total of 24% and 23% of Resources' total revenues in  
1996 and for the first nine months of 1997, respectively. These customers are   
currently under long-term contracts with Resources expiring in 1998 through     
2002. Three of these five contracts permit early termination by the customer in 
the following respective circumstances: (i) upon 10 days' notice to Resources   
for any reason; (ii) at the end of a budget year; and (iii) upon 30 days' notice
if required for the "public good" or because of change in applicable laws.      

 Resources has a long-term contract expiring on April 30, 2000, with the
largest customer for its title plant update services, which is terminable at the
option of that customer on April 30, 1998, by giving 90 days prior written      
notice. There can be no assurance that this customer will not exercise its      
option for early termination.                                                   

Competition                                                                 

     A number of local and regional businesses provide or offer at least some of
the products and services provided by Resources. In addition to third-party     
vendors, Resources occasionally competes with centralized information service   
departments of county or local governments to provide products or services to   
other departments and often must persuade the end-user department to discontinue
the service by its own personnel and outsource the service to Resources.        
Competition typically is based on price, service, and technological capabilities
or the ability to modify the products and services to be provided to accommodate
the requirements of the customer. County and local governments, often are       
required to put their contracts up for competitive bid on a periodic basis.     
Competition may be increased if a customer seeks bids on only one aspect of its 
system (such as imaging or indexing) rather than bidding all of the services as 
an integrated whole. Single function bidding generally results in more bidders  
and more intense price competition.                                             

   As a result of various acquisitions and sales of businesses by Resources,
it has contractual commitments not to compete in the property records services  
business in the Southeastern United States until September 1998. Additionally,  
in connection with Resources' acquisition of the title services division of     
Holdings in July 1997, Resources acquired the Dallas, Texas, data processing    
center of Holdings and agreed to provide to Holdings certain data entry services
for customers of property records services provided by Holdings. Resources also 
agreed not to solicit these customers, which are located primarily in the       
Northeastern and Southeastern United States, prior to August 1999.              

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Facilities                                                                  

The principal executive offices of Resources are located at 2800 W.   
Mockingbird Lane, Dallas, Texas 75235 and the telephone number is 214-902-5000. 

   Resources leases the following facilities in Texas, all of which are used
for both office and processing purposes:                                        

                                                        [Enlarge/Download Table]

                                               APPROXIMATE                              
                   LOCATION                    SQUARE FEET          OWNERSHIP           
                   --------                    -----------          ---------           
                                                                                        
Dallas, Texas (headquarters)..................   74,000     Lease expiring 12/31/2015(1)
Dallas, Texas (data center)...................   30,000     Lease expiring 12/31/1998   
San Antonio, Texas............................    4,300     Lease expiring 8/01/1999    
Amarillo, Texas...............................    1,986     Lease expiring 3/31/1998    

---------------                                                                 

(1) Pursuant to the Resources Merger Agreement, the Dallas headquarters land and
building will be transferred to T1 by Mr. Oates at the Closing.         

Employees                                                                   

    At September 30, 1997, Resources had approximately 185 employees, of which
nine are considered management, 11 are in sales and marketing, 11 are in        
software programming, and 154 perform support, maintenance, and other services. 
None of these employees are covered by collective bargaining agreements.        
Resources has strong employee retention with low turnover of personnel.         
Resources believes that its relationships with its employees are good.          

TSG                                                                             

Overview                                                                    

     TSG provides county governments with software systems and services to serve
their information technology and automation needs. TSG integrates its own       
products with computer equipment from hardware vendors, third-party database    
management applications, and office automation software. TSG assists a county   
with all aspects of its software and hardware selection, network design and     
management, installation and training, and on-going support and related         
services.                                                                       

 TSG historically has had low customer turnover. Maintenance and support
sales make up over one-half of TSG's revenues, and many orders for new systems  
are from existing customers. In total, approximately 80% of revenues are        
attributable to existing county customers. TSG considers its relationships with 
these counties to be its most important asset.                                  

TSG was formed as a Texas corporation in 1981 and currently services  
approximately 1,000 county and local government units and agencies, primarily in
Texas.                                                                          

Services                                                                    

     Judicial Information Management. TSG offers a complete suite of information
management products designed to meet the needs of various aspects of the        
judicial system. While each of these products may be installed on a stand-alone 
basis, most of the products are generally installed in the different government 
offices located in and around a county courthouse to take full advantage of the 
benefits of an integrated system of products. The ability to share information  
between government offices eliminates some of the duplicate input and record    
keeping and helps increase the efficiency of the offices.                       

Court System. TSG's Courts system is comprised of several integrated  
products designed to track and manage the information involved in criminal and  
civil cases. The criminal and civil case management applications track cases,   
process fines and fees, generates judgement and sentencing paperwork (criminal) 
or the numerous citations, notices, and forms required in a civil case, and     
generally track the status of each criminal and civil case in the court system. 
TSG's court administration application manages court calendars,                 

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coordinates judges' schedules, and generates court dockets. The criminal justice
information application accommodates local and state level reporting and        
electronic submission of case dispositions. An application designed for Justices
of the Peace processes traffic tickets and other limited jurisdiction court     
matters. Finally, TSG's applications for the district attorney or prosecutor of 
a county automate the investigation, tracking, and filing of cases.             

   Law Enforcement System. The applications comprising TSG's Law Enforcement
system are designed to automate all aspects of a sheriff's agency. Applications 
for jail management include booking and releases as well as the jail commissary.
The medical processing application tracks inmates' medical histories and        
generates invoices to inmates or third parties. TSG's incident and offense      
reporting application tracks officers' activities, categorizes reporting        
obligations, and prepares state and federal Uniform Crime Reports. Finally, the 
warrant tracking application helps a county sheriff's office track outstanding  
and closed arrest warrants. In addition, TSG offers a Computer Aided            
Dispatch/Emergency 911 system to track calls and the status of emergency        
response vehicles, interface with local and state searches, and generally assist
dispatchers in processing emergency situations.                                 

Other Judicial Information Products. TSG markets a variety of other   
specialized products in conjunction with the Courts system and the Law          
Enforcement system. Both systems are image-enabled using TSG's ableIMAGE        
application and the Law Enforcement system is video-enabled using ableVIDEO. A  
jury selection application assists election officials in the selection and      
notification of jurors, processing of jury payments, and management of juror    
histories. TSG's hot check processing application assists in the collection of  
bad checks, tracking of payments and fines, and issuance of disbursements to    
vendors. Applications relating to adult and juvenile probation track            
probationers, collect fines and fees, maintain probation history, and generate  
required state reporting.                                                       

Property Appraisal and Tax. TSG has a comprehensive system for the    
automation of Texas Central Appraisal Districts and assessors' and appraisers'  
offices in Oregon and Washington. The Automated Central Appraisal District      
system (the "ACAD system") is designed to automate the appraisal and assessment 
of real and personal property including record keeping, mass appraisal, inquiry 
and protest tracking, appraisal and tax roll generation, tax statement          
processing, and electronic state level reporting. The ACAD system can also be   
image- and video-enabled using TSG's ableIMAGE and ableVIDEO products for the   
storage of the many property related documents involved (including exemption    
applications, personal property renditions, and agricultural or special use     
application), as well as for the on-line storage of electronic photographs of   
properties for use in defending values in protest situations.                   

TSG's ACAD system can be used in connection with TSG's Automated Tax  
Collection system (the "ATC system"), which supports tax billing and collection 
agencies, including counties and city, school tax offices, as well as special   
collection agencies. The ATC system supports billing, collections, lock box     
operations, mortgage company electronic payments, and provides daily, monthly,  
and annual audit and distribution reporting.                                    

     Specialized Products. TSG markets an integrated fund accounting system that
conforms to government auditing and financial reporting requirements and        
generally accepted accounting principles. This system includes modules for      
accounts payable, budgetary accounting (general ledger), payroll/personnel,     
purchase order, fixed assets, revenues, bank manager, and human resources. This 
system can operate in any government agency, although it is primarily installed 
in county auditor and county treasurer offices.                                 

TSG also offers other specialized products that allow the government  
offices in and around a courthouse to further integrate and automate their      
operations. Through the child support application, TSG customers are able to    
track child support cases, payments, and disbursements. The voter registration  
application tracks registered voters, generates voter cards, prepares precinct  
rolls in support of elections, and interfaces with other state systems. TSG also
offers an absentee voting application to assist in the management and tracking  
of absentee voters, as well as an election night system to assist in the        
tabulation of election results from various precincts. A motor vehicle          
registration application is available from TSG to process fees and issue motor  
vehicle registrations. Finally, TSG's indexing application allows government    
officials to index all official public records such as deeds, birth and death   
certificates and commissioner's court minutes.                                  
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Imaging and Voice Products. TSG markets a variety of products that    
interface and enhance its other products. TSG's ableIMAGE is an electronic      
document imaging system that integrates the scanning, retrieval, and display of 
document images into all of TSG's applications where needed. For example, the   
ableIMAGE application integrates with both the Court and Law Enforcement systems
by allowing court related paperwork and documents to be scanned and stored as   
part of an electronic case folder designed to improve access to documents and   
reduce the need to distribute paper copies.                                     

  TSG's ableVIDEO application allows a customer to add an electronic video
imaging system which integrates the capture and display of pictures with all of 
TSG's applications. For example, the Law Enforcement system applications are    
video image-enabled using ableVIDEO to provide video mug shots of inmates at    
critical locations for identification and to allow investigators to compile     
electronic video line-ups.                                                      

    The Interactive Voice Response system developed by TSG interfaces with the
ACAD system to allow retrieval of basic property information and interfaces with
the child support system to allow retrieval of child support payment information
using any touch-tone telephone.                                                 

  In addition, appropriate TSG products support bar coding for tracking of
civil and criminal case folders, tracking of inmates, quick check-in of jurors, 
and rapid processing of tax statements.                                         

Internet Web Development. TSG has developed ableSERVE and a variety of
other specialized application database interfaces to allow the public records   
portion of information contained in the various TSG systems to be made available
to the public via the Internet. TSG also provides both web site development and 
web server hosting services for county customers.                               

Sales and Marketing                                                         

TSG's sales are primarily performed by its direct sales and marketing 
personnel who are presently organized into five sales territories within the    
states of Texas and Georgia. Sales for other states and national account        
opportunities are managed by TSG's Marketing Manager except for the states of   
Oregon and Washington which are currently handled by TSG's Northwest Manager.   
Other in-house staff focus on add-on sales, forms, supplies, and professional   
services.                                                                       

The sales of most new systems are typically to other offices or       
organizations in counties already using TSG applications and systems, but sales 
are also generated from referrals from adjoining counties, relationships        
established between a sales representative and county official, contacts at     
trade shows, direct mailings, and direct contact from a prospect already        
familiar with TSG.                                                              

    TSG is active in virtually all state-level county government associations,
including annual meetings, trade shows, and educational events. In addition, TSG
generally hosts customer luncheons at larger, statewide meetings such as the    
Texas Association of Appraisal Districts and the Texas County and District      
Clerks Association. TSG also hosts a user's group meeting for all TSG customers 
about once every 18 months, which provides an opportunity for customers to learn
more about TSG products and an opportunity for feedback.                        

Customers                                                                   

   TSG's customers consist primarily of county government offices, including
the auditor, treasurer, tax assessor/collector, county clerk, district clerk,   
county and district court judges, probation officers, sheriff's office, and     
county appraiser. No single customer (county government office) accounted for   
more than 5% of total revenues for the fiscal year ending October 31, 1996, or  
for the nine-month period ended July 31, 1997. No single county accounted for   
more than 10% of total revenues for the fiscal year ended October 31, 1996, or  
for the nine-month period ended July 31, 1997. Due to the nature of TSG's sales 
as installation of countywide systems, a county customer representing a         
significant portion of revenues in one year is generally not a source of        
significant revenues the following year. Contracts for products and services are
generally implemented over six months to one year with annually renewing service
and software update agreements thereafter. Currently, approximately one-half of 
TSG's revenues are attributable to ongoing support and maintenance agreements.  
Although by the terms of these agreements either TSG or the customer are        
entitled to terminate upon 90-                                                  

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days' notice after the first anniversary of the agreement, historically most    
agreements are automatically renewed annually.                                  

Competition                                                                 

  As with Resources, a large number of local and regional firms provide or
offer at least some of the products and services provided by TSG, and several   
local and regional firms compete with TSG across its full range of products and 
services. In addition to third-party vendors, TSG occasionally competes with    
centralized information service departments of the county or local governmental 
unit to provide products or services to other departments and often must        
persuade the end-user department to discontinue service by its own personnel and
outsource the service to TSG. Competition typically is based on confidence in   
the supplier, service, technological capabilities or the ability to modify the  
products and services to be provided to accommodate the requirements of the     
customer, and price. TSG's ability to offer an integrated system of applications
for several offices is often a factor in its favor.                             

County and local governmental units often are required to put their   
contracts up for competitive bid on a periodic basis. Competition may be        
increased if a customer seeks bids on only one aspect of its system (such as    
only voter registration) rather than bidding all of the services as an          
integrated whole. Single function bidding generally results in more bidders and 
more intense price competition. TSG is a Qualified Information Systems Vendor   
for the Texas General Services Commission on state purchasing contracts and, as 
a result, in some cases county governments offices may contract with TSG        
directly without a bid process.                                                 

Facilities                                                                  

   TSG leases a 25,000 square foot office at 1120 Jupiter Road, Plano, Texas
75023 and the telephone number is 972-424-1579. The office lease expires in     
October 1999.                                                                   

Employees                                                                   

     At September 1, 1997, TSG had approximately 80 employees, of which five are
considered management, seven are in sales and marketing, 24 are in software     
programming, and 44 perform support, maintenance, and other services. None of   
these employees are covered by collective bargaining agreements. TSG believes   
that its relationships with its employees are good.                             

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MANAGEMENT

THE COMPANY                                                                     

    The following table sets forth certain information regarding the directors
and executive officers of the Company:                                          

                                                        [Enlarge/Download Table]

         NAME           AGE                              POSITION                            
         ----           ---                              --------                            
                                                                                             
Louis A. Waters........ 59   Director and Chairman of the Board                              
C.A. Rundell, Jr....... 66   Director, President, and Chief Executive Officer                
James E. Russell....... 62   Director, Vice President, Chief Financial Officer, and Secretary
Brian K. Miller........ 39   Vice President and Chief Accounting Officer                     
Harold W. Parkison..... 49   President and Chief Executive Officer of Forest City            
Ernest H. Lorch........ 65   Director                                                        
Frederick R. Meyer..... 70   Director                                                        
William D. Oates....... 56   Future Director (1)                                             

---------------                                                                 

(1) Mr. Oates will be elected to the Tyler Board following the consummation of  
  the Resources Acquisition and will be a member of the Executive Committee.

  Louis A. Waters. Mr. Waters was elected Chairman of the Board in October
1997 after becoming a director of the Company in August 1997. Mr. Waters is a   
member of the Executive Committee, Audit Committee, and Compensation Committee  
of the Tyler Board. Mr. Waters is one of the founders and was the first Chairman
of the Board of Browning-Ferris Industries, Inc. ("BFI"). He served as Chairman 
and Chief Executive Officer from 1969 through 1980, Chairman of BFI's Executive 
Committee from 1980 through 1988, and Chairman of the Finance Committee from    
1988 to March 1997. Mr. Waters also directed BFI's international activities,    
serving as Chairman and Chief Executive Officer of BFI International, Inc. from 
1991 to March 1997 when he retired from full-time employment with BFI. During   
Mr. Waters' tenure, BFI grew from a small Houston company in 1969 to a $5.8     
billion international waste services company operating across North America and 
11 other countries, including The Netherlands, Germany, and the United Kingdom. 
This growth included over 2,000 acquisitions.                                   

  C. A. Rundell, Jr. Mr. Rundell was elected President and Chief Executive
Officer of the Company in October 1997. From October 1996 to October 1997, Mr.  
Rundell served as Chairman of the Board and from October 1996 to March 1997     
served as Interim Chief Executive Officer of the Company. Mr. Rundell has been a
director of the Company since 1966 and is a member of the Executive Committee of
the Tyler Board. Since 1988, Mr. Rundell has owned and operated Rundell         
Enterprises, a venture capital and investments company engaged in providing     
acquisition and financial consulting services to various business enterprises.  
He has served as director and Chairman of the Board of NCI Building Systems,    
Inc. since April 1989. From 1977 to 1988, Mr. Rundell was the President, Chief  
Executive Officer, and a director of Cronus. In 1983, Cronus acquired Records,  
which thereafter made over 15 acquisitions of other companies. He is also a     
director of Dain Rauscher Corporation, a holding company for a full-service     
regional brokerage and investment banking company, and Tandy Brands Accessories,
Inc., a manufacturer of accessories for men, women, and boys.                   

   James E. Russell. Mr. Russell was elected Vice President, Chief Financial
Officer, and Secretary of the Company in November 1997. Mr. Russell has been a  
director of the Company since May 1990. Mr. Russell has been associated with the
Company for approximately 30 years. He served as Vice President of the Company  
from January 1992 to August 1995 and was Chairman of the Board of Tyler Pipe    
Industries, Inc., a former subsidiary of the Company ("Tyler Pipe"), until his  
retirement in August 1995. He was President and Chief Executive Officer of Tyler
Pipe from December 1988 to December 1991 and was President and Chief Operating  
Officer of Tyler Pipe from February 1988 to December 1988.                      

  Brian K. Miller. Mr. Miller has been Vice President and Chief Accounting
Officer of the Company since December 1997. From June 1986 through December     
1997, Mr. Miller held various senior financial management positions at Metro    
Airlines, Inc. ("Metro"), a regional airline holding company. Mr. Miller was    

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Chief Financial Officer of Metro from May 1991 to December 1997 and also held   
the office of President of Metro from January 1993 to December 1997. From March 
1994 to November 1995, Mr. Miller also held the position of Vice President and  
Chief Financial Officer of Lone Star Airlines, a regional airline. Mr. Miller is
a certified public accountant.                                                  

 Harold W. Parkison. Mr. Parkison has been President and Chief Executive
Officer of Forest City since February 1997. Mr. Parkison had previously been    
Vice President-International Store Development at Federal-Mogul Corp. since     
March 1995. From 1993 to March 1995, he was Vice President-Merchandise Manager  
at Auto Express. From 1991 to 1993, he held the position of Vice                
President-Automotive for Kmart Corporation. Between 1971 and 1991, he held      
various management positions at Goodyear Tire and Rubber Company.               

     Ernest H. Lorch. Mr. Lorch has been a director of the Company since October
1993 and is a member of the Audit Committee and Compensation Committee of the   
Tyler Board. Mr. Lorch is counsel to the law firm of Whitman, Breed, Abbott &   
Morgan, a position he has held since December 1992. He retired as Chairman of   
the Board and Chief Executive Officer of Dyson-Kissner-Moran Corporation        
("DKM"), a private investment company, in December 1992, a position he held     
since January 1990. Mr. Lorch was President and Chief Operating Officer of DKM  
from June 1984 to January 1990. He is also a director and Senior Chairman of the
Board of Varlen Corporation and a director of Dorsey Trailers, Inc.             

     Frederick R. Meyer. Mr. Meyer has been a director of the Company since 1967
and is a member of the Compensation Committee of the Tyler Board. Since July    
1985, Mr. Meyer has been Chairman of the Board of Aladdin Industries, Inc., a   
diversified company principally engaged in the manufacture of children's lunch  
kits, thermosware, insulated food delivery systems and related products. He has 
also been President and Chief Executive Officer of Aladdin Industries, Inc. from
October 1995 to present and from May 1987 to September 1994. He was President of
Tyler Corporation from August 1983 through December 1986. He is also a director 
of Arvin Industries, Inc., Palm Harbor Homes, Inc., and Southwest Securities    
Group, Inc.                                                                     

     William D. Oates. Mr. Oates has been Chairman of the Board and President of
Resources since its inception in 1993 and is the sole Class A Holder of         
Resources. He has also served as a director and President of the wholly owned   
subsidiaries of Resources from 1993 to the present. From 1987 through 1994, Mr. 
Oates acquired or formed and served as President or a principal executive       
officer of American Title Company of Dallas, Austin Title Company, Commercial   
Abstract & Title Company and other title insurance agencies in Texas, as well as
a title insurance underwriting company. Mr. Oates held these companies through  
American Title, of which he was the principal owner and President until his sale
of the company in November 1994. In that sale, Mr. Oates retained GRS, a        
principal operating subsidiary of Resources. Between 1970 and 1986, Mr. Oates   
served as a director and President of Records. Mr. Oates founded Records in 1970
principally to provide micrographics recording and computerized indexing of     
public real property records for county governments. In October 1983, he sold   
Records to Cronus, but remained President of Records until April 1987 and served
as a director of Cronus from October 1983 through April 1986.                   

NEW RESOURCES                                                                   

    The following table sets forth certain information regarding the directors
and executive officers of New Resources following the consummation of the       
Resources Acquisition:                                                          

                                                        [Enlarge/Download Table]

             NAME               AGE                        POSITION                       
             ----               ---                        --------                       
                                                                                          
William D. Oates............... 56   Director, Chairman of the Board, President, and Chief
                                     Executive Officer                                    
John D. Woolf.................. 53   Executive Vice President, Treasurer, and Secretary   
Brian K. Miller................ 39   Chief Financial Officer                              
Brian B. Berry................. 42   Director                                             
C.A. Rundell, Jr............... 66   Director                                             
Glenn A. Smith................. 44   Director                                             

   Information concerning the business experience of Messrs. Oates, Rundell,
and Miller is provided in the section entitled "Management -- The Company."     

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John D. Woolf. Mr. Woolf has served as a director and Executive Vice  
President and Chief Financial Officer of Resources since November 1994. From    
1987 through 1994, Mr. Woolf served as a director and Executive Vice President  
and Chief Financial Officer of American Title. Prior to that time, Mr. Woolf    
served as Vice President-Finance and Treasurer of Records, working with Mr.     
Oates in negotiating and consummating multiple acquisitions and mergers from    
1984 through 1986. Mr. Woolf has also held finance and accounting positions with
the Company, including serving as Controller of Atlas Powder Company, a former  
subsidiary of the Company, from 1977 through 1979.                              

  Brian B. Berry. Mr. Berry is one of the original founders of TSG and has
served as an officer and director of TSG with various responsibilities since its
inception in 1981. Mr. Berry is Vice President and Treasurer of TSG and his     
current responsibilities are primarily financial management, business           
development, and contract negotiations. Prior to founding TSG, Mr. Berry was    
employed at Management Decision Systems of Dallas, Texas, in a software         
development project management capacity and, prior to that, at Texas Instruments
as a software developer.                                                        

  Glenn A. Smith. Mr. Smith is one of the original founders of TSG and has
served as an officer and director of TSG with various responsibilities since its
inception in 1981. Mr. Smith is President of TSG and responsible for the        
management of TSG. Prior to founding TSG, Mr. Smith was employed at Distributed 
Data Systems of Raleigh, North Carolina, in a software development project      
management capacity and, prior to that, at Texas Instruments as a software      
developer.                                                                      

TSG                                                                             

    The following table sets forth certain information regarding the directors
and executive officers of TSG following the consummation of the TSG Acquisition:

                                                        [Enlarge/Download Table]

                  NAME                    AGE                    POSITION                  
                  ----                    ---                    --------                  
                                                                                           
C.A. Rundell, Jr.........................  66  Director and Chairman of the Board          
Glenn A. Smith...........................  44  Director, President, and Assistant Secretary
Brian B. Berry...........................  42  Director, Vice President, and Secretary     
Brian K. Miller..........................  39  Chief Financial Officer                     
William D. Oates.........................  56  Director                                    

   Information concerning the business experience of Messrs. Oates, Rundell,
and Miller is provided in the section entitled "Management--The Company."       
Information concerning the business experience of Messrs. Smith and Berry is    
provided in the section entitled "Management--New Resources."                   

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SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS
AND MANAGEMENT OF THE COMPANY 

The following table sets forth as of December 23, 1997 (the "Ownership
Date") (unless otherwise indicated), the amount and percentage of shares of     
Common Stock that are deemed under the rules of the Commission to be            
"beneficially owned" by (i) each director of the Company, (ii) the named        
executive officers of the Company as of the end of 1996, (iii) all directors and
executive officers of the Company as a group and (iv) each person or "group" (as
such term is used in Section 13(d)(3) of the Exchange Act) known by the Company 
to be the beneficial owner of more than 5% of the outstanding shares of Common  
Stock.                                                                          

                                                        [Enlarge/Download Table]

                                                          AMOUNT AND                     
                                                            NATURE                       
                                                         OF BENEFICIAL     APPROXIMATE   
               NAME OF BENEFICIAL OWNER                 OWNERSHIP(1)(2)  PERCENT OF CLASS
               ------------------------                 ---------------  ----------------
                                                                                         
Ernest M. Lorch.......................................        50,000         *           
Richard W. Margerison (3).............................            --             --      
Joseph F. McKinney (4)................................       378,239            1.7%     
Frederick R. Meyer....................................       227,349            1.0%     
E. Peter Raisbeck (5).................................         1,600         *           
C.A. Rundell, Jr.(6)..................................       368,657            1.7%     
James E. Russell......................................       257,543            1.2%     
Louis A. Waters(7)....................................     4,000,000           16.7%     
All directors of the Company and executive officers as                                   
  a group (7 persons)(8)..............................     4,903,549           20.3%     
5% STOCKHOLDERS:                                                                         
Gabelli Funds, Inc.(9)................................     2,625,900           12.0%     
One Corporate Centre                                                                     
Rye, New York 10580                                                                      
Dimension Funds Advisors(10)..........................     1,094,100            5.0%     
1299 Ocean Avenue                                                                        
Santa Monica, California 90401                                                           
Richmond Partners, Ltd.(7)............................     4,000,000           16.7%     
10375 Richmond Avenue, Suite 1615                                                        
Houston, Texas 77042                                                                     

---------------                                                                 

*  Less than 1% of the outstanding Common Stock.                            

(1) Each share of Common Stock is accompanied by one Preferred Stock Purchase 
Right. See "Interests of Certain Persons in Matters to be Acted       
Upon -- Rights Agreement."                                            

(2) Under the rules of the Commission, a person is deemed to be the beneficial
   owner of a security if such person, directly or indirectly, has or shares
 the power to vote or direct the voting of such security or the power to
     dispose or direct the disposition of such security. A person is also deemed
    to be a beneficial owner of any securities if that person has the right to
acquire beneficial ownership within 60 days of the Ownership Date.    
     Accordingly, more than one person may be deemed to be a beneficial owner of
the same securities. Unless otherwise indicated by footnote, the named
individuals have sole voting and investment power with respect to the 
shares of the Common Stock beneficially owned.                        

(3) Richard W. Margerison resigned as President and Chief Operating Officer of
  the Company in April 1997 and as a director of the Company in June 1997.

 (4) Joseph F. McKinney resigned as a director, Chairman of the Board, and Chief
Executive Officer of the Company in October 1996.                     

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(5) E. Peter Raisbeck was the Chairman and Chief Executive Officer of IFS. The
Company sold IFS effective October 15, 1997.                          

(6) Includes 167,288 shares subject to options granted under the Company's    
   Stock Option Plan that are exercisable within 60 days after the Ownership
Date.                                                                 

(7) Includes 2,000,000 shares owned by Richmond Partners, Ltd. ("Richmond"),  
and 2,000,000 shares subject to a warrant issued to Richmond that is  
     exercisable within 60 days after the Ownership Date at an exercise price of
$2.50 per share. Mr. Waters is the sole general partner of Richmond.  

(8) Includes (i) 167,288 shares subject to options granted under the Company's
   Stock Option Plan that are exercisable within 60 days after the Ownership
 Date and (ii) 2,000,000 shares subject to a warrant that is exercisable
within 60 days after the Ownership Date.                              

(9) The number of shares is based on information as of November 19, 1997, and 
    filed with the Commission. Shares are held by Gabelli Funds, Inc., and its
 affiliates, GAMCO Investors, Inc., and Gabelli Performance Partnership,
   L.P. Also, Mr. Mario J. Gabelli is deemed to have beneficial ownership of
 these shares. Includes 2,619,400 shares with sole voting and investment
power and 6,500 shares with sole investment power.                    

(10) The Company does not have current information to determine the number of   
  shares, if any, for which the holder may have other than sole voting and
investment power.                                                     

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INTERESTS OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON

RIGHTS AGREEMENT                                                                

  Pursuant to the Rights Agreement dated as of March 14, 1993 (the "Rights
Agreement"), between the Company and The First National Bank of Boston as Rights
Agent, each share of Common Stock is accompanied by a right (a "Preferred Stock 
Purchase Right") to purchase, under certain conditions set forth in the Rights  
Agreement, one-hundredth of a share of Series A Junior Participating Preferred  
Stock, $10.00 par value per share. The issuance of 10,000,000 shares of Common  
Stock to Mr. Oates pursuant to the Resources Merger Agreement will trigger the  
exercisability of the Preferred Stock Purchase Rights beginning after the close 
of business on the fifteenth day (subject to extension by the Tyler Board) after
the Closing. The Tyler Board has, however, determined pursuant to the Rights    
Agreement to cause the Company to redeem all of the outstanding Preferred Stock 
Purchase Rights at a redemption price of $.01 per Preferred Stock Purchase Right
prior to the Preferred Stock Purchase Rights becoming exercisable. The Company's
Chief Executive Officer, as authorized by the Tyler Board, has set the Record   
Date for the Special Meeting as the record date for determining the stockholders
of the Company whose Preferred Stock Purchase Rights are to be redeemed.        

CONTROL OF THE COMPANY                                                          

 Upon consummation of the Acquisitions, Mr. Oates will own approximately
25.8% of the outstanding shares of Common Stock. The issuance of shares of      
Common Stock to Mr. Oates pursuant to the Resources Merger Agreement triggers   
the exercisability of the Preferred Stock Purchase Rights pursuant to the Rights
Agreement. See "--Rights Agreement." As long as Mr. Oates owns a significant    
percentage of the shares of Common Stock, he may retain substantial influence   
over the affairs of the Company through the election of directors and otherwise.
Upon consummation of the Acquisitions, Messrs. Smith and Berry will own         
approximately 2.7% and 2.3%, respectively, of the outstanding shares of Common  
Stock.                                                                          

OATES EMPLOYMENT AGREEMENT                                                      

     Pursuant to the Resources Merger Agreement, the Company, New Resources, and
Mr. Oates will enter into the Oates Employment Agreement at or before the       
Closing, to be effective at the Closing. Pursuant to the Oates Employment       
Agreement, New Resources will employ Mr. Oates for a minimum period of three    
years after the consummation of the Resources Acquisition. During his           
employment, Mr. Oates will serve as President and Chief Executive Officer of New
Resources and will devote his full business time and efforts to the business of 
New Resources. Mr. Oates will receive an annual base salary of $200,000 per year
and will be eligible to participate in performance bonus or incentive           
compensation plans made available to comparable level employees of New          
Resources, the Company, and the Company's subsidiaries. Mr. Oates will also     
receive all employee fringe benefits and perquisites normally offered by New    
Resources to its executive employees, including the use of a suitable           
automobile, vacations, and sick leave. Pursuant to the Oates Employment         
Agreement, Mr. Oates will agree that any discovery, invention, or improvement   
made by him during the term of his employment or within six months thereafter   
that relates to the business of New Resources or its subsidiaries is the        
exclusive property of Resources. After expiration of the initial three-year     
term, either New Resources or Mr. Oates may terminate Mr. Oates' employment with
New Resources at will and without any cause whatsoever by giving 30-days' prior 
written notice of the intention to terminate. New Resources may at any time,    
during the initial three-year term or thereafter, terminate the employment of   
Mr. Oates for just cause as defined in the Oates Employment Agreement.          

The Oates Employment Agreement also includes nonsolicitation and      
noncompetition agreements by Mr. Oates that will remain effective until the     
later of the fifth anniversary of the Resources Acquisition or the third        
anniversary of the termination for any reason of Mr. Oates' employment with New 
Resources and all of its affiliates. Mr. Oates will agree not to hire, solicit, 
or seek to hire any employee of New Resources or any of its affiliates who is   
party to a confidentiality agreement with Resources or has covenanted not to    
compete with New Resources or any of its affiliates. Mr. Oates will also agree  
that he will not directly or indirectly engage in any competitive business in   
any state in which such products or services are being or were being provided by
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Resources or its affiliates as of October 8, 1997, or by New Resources or its   
affiliates during the term of his employment by Resources or any of its         
affiliates, including providing the same or similar products or services to any 
person or entity that is or was a customer or affiliate of a customer of New    
Resources or any of its affiliates at any time during the term of Mr. Oates'    
employment.                                                                     

TSG EMPLOYMENT AGREEMENTS                                                       

   Pursuant to the TSG Merger Agreement, the Company, and New TSG on the one
hand, and Mr. Berry and Mr. Smith, on the other hand, will enter into the       
respective TSG Employment Agreements at or before the Closing, to be effective  
at the Closing. Pursuant to the TSG Employment Agreements, TSG will employ      
Messrs. Berry and Smith for a minimum period of five years after the            
consummation of the TSG Acquisition. During their employment, Mr. Smith will    
serve as President and Mr. Berry will serve as Vice President and Secretary of  
TSG. Both will devote their full business time and efforts to the business of   
TSG. Messrs. Berry and Smith will receive an annual base salary of $200,000 per 
year and will be eligible to participate in performance bonus or incentive      
compensation plans made available to comparable level employees of TSG, the     
Company, and the Company's subsidiaries. Messrs. Berry and Smith will also      
receive all employee fringe benefits and perquisites normally offered by TSG to 
its executive employees, including the use of suitable automobiles, vacations,  
and sick leave. In addition, TSG will be obligated to maintain disability       
insurance policies for Messrs. Berry and Smith. Pursuant to the TSG Employment  
Agreements, Messrs. Berry and Smith will agree that any discovery, invention, or
improvement made by either of them during the term of their employment or within
six months thereafter that relates to the business of TSG or its subsidiaries is
the exclusive property of TSG. After expiration of the initial five-year term,  
TSG or Mr. Berry or Mr. Smith may terminate their respective employment with TSG
at will and without any cause whatsoever by giving 30-days' prior written notice
of the intention to terminate. TSG may at any time, during the initial five-year
term or thereafter, terminate the employment of either Mr. Berry or Mr. Smith   
for just cause as defined in the TSG Employment Agreements.                     

The TSG Employment Agreements also include nonsolicitation and        
noncompetition agreements by Messrs. Berry and Smith that will remain effective 
until the later of the fifth anniversary of the TSG Acquisition or the second   
anniversary of the termination for any reason of their employment with TSG and  
all of its affiliates. Messrs. Berry and Smith will agree not to hire, solicit, 
or seek to hire any employee of TSG or any of its affiliates who is party to a  
confidentiality agreement with TSG or has covenanted not to compete with TSG or 
any of its affiliates. Messrs. Berry and Smith will also agree that they will   
not directly or indirectly engage in any competitive business in any state in   
which such products or services are being or were being provided by TSG or its  
affiliates as of October 8, 1997, or by TSG or its affiliates during the term of
their employment by TSG or any of its affiliates, including providing the same  
or similar products or services to any person or entity that is or was a        
customer or affiliate of a customer of TSG or any of its affiliates at any time 
during the term of their employment.                                            

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AMENDMENT TO THE CHARTER
(PROPOSAL NO. 3)

The Tyler Board of Directors believes that it is desirable for the    
stockholders to consider and act upon a proposed amendment to the Company's     
Charter. Pursuant to the proposed amendment, the number of shares of Common     
Stock authorized and available for issuance will be increased from 50,000,000 to
100,000,000.                                                                    

   Of the 50,000,000 currently authorized shares of Common Stock, 23,309,277
were issued as of the Record Date. Of the remaining 26,690,723 authorized shares
of Common Stock, (i) 1,365,565 were issued and held as treasury shares, (ii)    
10,000,000 were reserved for issuance pursuant to the Resources Merger          
Agreement, (iii) 2,000,000 were reserved for issuance pursuant to the TSG Merger
Agreement, (iv) 1,401,315 were reserved for issuance in connection with the     
Company's Stock Option Plan, and (v) 2,000,000 were reserved for issuance       
pursuant to outstanding warrants to purchase Common Stock.                      

Except for the foregoing, the Company does not have any present plan, 
understanding, or agreement to issue additional shares of Common Stock. The     
Tyler Board believes, however, that the proposed increase in authorized shares  
of Common Stock is desirable to enhance the Company's flexibility in connection 
with possible future actions, such as stock splits, stock dividends, finances,  
corporate mergers, acquisitions of businesses or property, use in employee      
benefit plans or stock option plans, or other corporate purposes. The Tyler     
Board will determine whether, when, and on what terms the issuance of shares of 
Common Stock may be appropriate in connection with any of the foregoing         
purposes.                                                                       

If the proposed amendment is approved, all or any of the additional   
authorized shares of Common Stock may generally be issued without further action
by the stockholders and without first offering such shares to the stockholders  
for subscription, unless required by law or any rules or regulations to which   
the Company is subject. However, as long as the Common Stock is listed on the   
New York Stock Exchange, the New York Stock Exchange would generally require    
stockholder approval for the issuance of Common Stock when: (i) a stock option  
or purchase plan is to be established or other arrangements made pursuant to    
which Common Stock may be acquired by directors or officers, except for warrants
or rights issued generally to securityholders of the Company or broadly-based   
plans or arrangements including other employees; (ii) a business, a company,    
tangible or intangible assets or property, or securities representing any such  
interest, is to be acquired, directly or indirectly, from a director, officer,  
or substantial securityholder of the Company (including its subsidiaries,       
affiliates, or other closely related persons) or from any company or party in   
which one of such persons has a substantial direct or indirect interest if the  
number of shares of Common Stock to be issued or the number of shares of Common 
Stock into which the securities may be convertible exceeds one percent of the   
number of shares of Common Stock, or 1% of the voting power, outstanding before 
the issuance; (iii) Common Stock or securities convertible into or exercisable  
for Common Stock are to be issued in any transaction or series of related       
transactions, other than a public offering for cash, if (a) the Common Stock to 
be issued has, or will have upon issuance, voting power equal to or in excess of
20% of the voting power outstanding before the issuance of such Common Stock or 
securities convertible into or exercisable for Common Stock, or (b) the number  
of shares of Common Stock to be issued is, or will be, equal to or in excess of 
20% of the number of shares of Common Stock outstanding before the issuance of  
the Common Stock; or (iv) the issuance would result in a change in control of   
the Company. The additional shares of Common Stock to be authorized will not    
have preemptive rights.                                                         

The issuance of Common Stock otherwise than on a pro rata basis to all
holders of such stock would reduce the proportionate interests of such          
stockholders. The availability for issuance of the additional shares of Common  
Stock and any issuance may be viewed as having the effect of discouraging an    
unsolicited attempt by another person or entity to acquire control of the       
Company. Although the Tyler Board has no present intention of doing so, the     
Company's authorized but unissued Common Stock could be issued in one or more   
transactions that would make a takeover of the Company more difficult or costly 
and therefore less likely. The Company is not aware of any person or entity who 
is seeking to acquire control of the Company. Holders of Common Stock do not    
have any preemptive rights to acquire any additional securities issued by the   
Company.                                                                        

     Other than increasing the authorized shares of Common Stock from 50,000,000
to 100,000,000, the proposed amendment in no way changes the Charter.           
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  The Board has unanimously adopted resolutions setting forth the proposed
amendment to the Charter declaring its advisability, and directing that the     
proposed amendment be submitted to the stockholders for their approval at the   
Special Meeting. If adopted by the stockholders, the amendment will become      
effective upon filing as required by the stockholders, the amendment will become
effective upon filing as required by the General Corporation Law of Delaware.   

  THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSED AMENDMENT TO
THE CHARTER AS DESCRIBED ABOVE.                                                 

ACCOUNTANTS 

The firm of Ernst & Young LLP is the Company's independent public     
accountant and has acted in this capacity in connection with the consolidated   
financial statements of the Company incorporated herein by reference. A         
representative of Ernst & Young LLP (i) is expected to be present at the Special
Meeting, (ii) will have the opportunity to make a statement if he desires to do 
so, and (iii) is expected to be available to respond to appropriate questions.  

STOCKHOLDER PROPOSALS 

    Any proposals that stockholders of the Company desire to have presented at
the 1998 annual meeting of stockholders must have been received by the Company  
at its principal executive offices not later than November 12, 1997.            

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE 

    THIS PROXY STATEMENT INCORPORATES CERTAIN DOCUMENTS BY REFERENCE WHICH ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. SUCH DOCUMENTS (OTHER THAN EXHIBITS 
TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY         
REFERENCE) ARE AVAILABLE WITHOUT CHARGE, TO ANY PERSON TO WHOM THIS PROXY       
STATEMENT IS DELIVERED UPON WRITTEN OR ORAL REQUEST, AND BY FIRST CLASS MAIL (OR
OTHER EQUALLY PROMPT MEANS) WITHIN ONE BUSINESS DAY OF RECEIPT OF SUCH REQUEST. 
REQUESTS FOR SUCH DOCUMENTS SHOULD BE DIRECTED TO TYLER CORPORATION, ATTENTION: 
CORPORATE SECRETARY, 2121 SAN JACINTO STREET, SUITE 3200, SAN JACINTO TOWER,    
DALLAS, TEXAS 75201, 214-754-7861. IN ORDER TO ENSURE TIMELY DELIVERY OF THE    
DOCUMENTS, ANY REQUEST SHOULD BE MADE BY FEBRUARY 11, 1998.                     

  The information in the following documents filed by the Company with the
Commission (File No. 1-10485) pursuant to the Exchange Act, is incorporated by  
reference in this Proxy Statement:                                              

        (a) Annual Report on Form 10-K for the year ended December 31, 1996,
filed with the Commission on March 10, 1997;                          

     (b) Quarterly Report on Form 10-Q for the quarter ended March 31,
1997, filed with the Commission on May 12, 1997;                      

          (c) Quarterly Report on Form 10-Q for the quarter ended June 30, 1997,
filed with the Commission on August 14, 1997;                         

         (d) Quarterly Report on Form 10-Q for the quarter ended September 30,
1997, filed with the Commission on November 7, 1997;                  

 (e) Current Reports on Form 8-K, (i) dated and filed with the
 Commission on September 2, 1997, (ii) dated October 16, 1997, and filed
 with the Commission on October 17, 1997, (iii) dated and filed with the
Commission on October 30, 1997, and (iv) dated and filed with the     
     Commission on December 31, 1997, as amended by Form 8-K/A, Amendment No. 1,
filed with the Commission on January 21, 1998; and                    

       (f) Proxy Statement dated as of March 17, 1997, filed in definitive
     form on March 10, 1997, with the Commission with respect to the information
required to be included herein by Items 401                           
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   (management), 402 (executive compensation) and 404 (certain relationships
and related transactions) of Regulation S-K promulgated under the     
Securities Act and the Exchange Act.                                  

   All documents filed by the Company pursuant to Sections 13(a), 13(c), 14,
or 15(d) of the Exchange Act subsequent to the date of this Proxy Statement and 
prior to the Special Meeting shall be deemed to be incorporated by reference in 
this Proxy Statement and to be a part hereof from the date of filing of such    
documents.                                                                      

 Any statements made herein or in documents incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded   
for purposes of this Proxy Statement to the extent that a statement contained   
herein or in any other subsequently filed documents which is also incorporated  
or deemed to be incorporated by reference herein modified or supersedes such    
statement. Any such statement so modified or superseded shall not be deemed,    
except as so modified or superseded, to constitute a part of this Proxy         
Statement.                                                                      

   The information relating to the Company contained in this Proxy Statement
should be read together with the information in the documents incorporated by   
reference.                                                                      

    All information contained in this Proxy Statement relating to Resources or
TSG has been supplied by Resources or TSG, respectively, information regarding  
the Acquisitions has been supplied by the Company, Resources, and/or TSG, and   
all other information has been supplied by the Company.                         

                                           By Order of the Board of Directors,

                             /s/  JAMES E. RUSSELL

                        JAMES E. RUSSELL

                 Secretary

Dallas, Texas                                                                   

January 21, 1998                                                                

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INDEX TO FINANCIAL STATEMENTS 

                                                                [Download Table]
                                                                  
Financial Statements -- Business Resources Corporation            
  Independent Auditors' Report..............................   F-2
  Consolidated Balance Sheets...............................   F-3
  Consolidated Statements of Operations.....................   F-4
  Consolidated Statements of Stockholders' Equity...........   F-6
  Consolidated Statements of Cash Flows.....................   F-7
  Notes to Consolidated Financial Statements................   F-9

Financial Statements -- The Software Group, Inc.                  
  Independent Auditors' Report..............................  F-20
  Balance Sheets............................................  F-21
  Statements of Operations..................................  F-22
  Statements of Stockholders' Equity........................  F-23
  Statements of Cash Flows..................................  F-24
  Notes to Financial Statements.............................  F-26

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INDEPENDENT AUDITORS' REPORT

The Board of Directors                                                          
Business Resources Corporation:                                                 

  We have audited the accompanying consolidated balance sheets of Business
Resources Corporation and subsidiaries as of December 31, 1995 and 1996, and the
related consolidated statements of operations, stockholders' equity, and cash   
flows -- Predecessor for the period from January 1, 1994 to November 30, 1994   
and -- Successor for the period from December 1, 1994 to December 31, 1994 and  
for the years ended December 31, 1995 and 1996. These consolidated financial    
statements are the responsibility of the Company's management. Our              
responsibility is to express an opinion on these consolidated financial         
statements based on our audits.                                                 

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain 
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting 
the amounts and disclosures in the financial statements. An audit also includes 
assessing the accounting principles used and significant estimates made by      
management, as well as evaluating the overall financial statement presentation. 
We believe that our audits provide a reasonable basis for our opinion.          

 In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Business    
Resources Corporation and subsidiaries as December 31, 1995 and 1996, and the   
results of their operations and their cash flows -- Predecessor for the period  
from January 1, 1994 to November 30, 1994 and -- Successor for the period from  
December 1, 1994 to December 31, 1994 and for the years ended December 31, 1995 
and 1996, in conformity with generally accepted accounting principles.          

                                  /s/  KPMG PEAT MARWICK LLP

                             KMPG PEAT MARWICK LLP

Dallas, Texas                                                                   
February 7, 1997                                                                

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED BALANCE SHEETS 

ASSETS

                                                        [Enlarge/Download Table]

                                                  DECEMBER 31,         SEPTEMBER 30, 1997 (UNAUDITED) 
                                            -------------------------  -------------------------------
                                               1995          1996        HISTORICAL       PRO FORMA   
                                            -----------   -----------  --------------   --------------
                                                                                           (NOTE 1)   
                                                                                                      
Current assets:                                                                                       
  Cash and cash equivalents...............  $   472,472   $   247,398     $   859,023      $   859,023
  Accounts receivable, less allowance for                                                             
     doubtful accounts of $76,000 in 1995,                                                            
     $54,000 in 1996 and $85,000 in                                                                   
     1997.................................    1,910,355     2,335,869       2,311,322        2,311,322
  Other current receivables (note 5)......           --            --         580,393          580,393
  Current portion of notes receivable                                                                 
     (note 5).............................      250,000       250,000              --               --
  Deferred income taxes (note 8)..........      701,244            --              --          135,322
  Prepaid expenses and other..............       17,659       141,175         100,866          100,866
                                            -----------   -----------     -----------      -----------
          Total current assets............    3,351,730     2,974,442       3,851,604        3,986,926
Notes receivable, less current portion                                                                
  (note 5)................................      937,500       687,500              --               --
Noncurrent portion of other receivables                                                               
  (note 5)................................           --            --         728,115          728,115
Property and equipment, net (note 2)......    5,387,379     6,227,234       6,667,988        6,667,988
Intangible assets, net of accumulated                                                                 
  amortization of $287,048 in 1995,                                                                   
  $482,809 in 1996 and $660,090 in 1997...      987,714     1,243,844       6,688,669        6,688,669
Deferred income taxes (note 8)............           --            --              --           83,614
Other assets, net.........................       80,571       117,425         109,607          109,607
                                            -----------   -----------     -----------      -----------
                                            $10,744,894   $11,250,445     $18,045,983      $18,264,919
                                            ===========   ===========     ===========      ===========

                                 LIABILITIES AND STOCKHOLDER'S EQUITY                                 
Current liabilities:                                                                                  
  Accounts payable........................  $   729,015   $   527,512     $   307,473      $   307,473
  Accrued expenses (note 3)...............    1,649,687       855,172       1,410,513        1,410,513
  Current installments of obligations                                                                 
     under capital leases (note 7)........      129,511       177,156         179,155          179,155
  Current portion of long-term debt (note                                                             
     6)...................................      957,151     1,843,817       2,252,735        2,252,735
  Deferred income taxes (note 8)..........           --        38,920              --               --
  Income taxes payable....................           --        90,206         128,465          128,465
  Dividend payable (note 1)...............           --            --              --        3,300,000
                                            -----------   -----------     -----------      -----------
          Total current liabilities.......    3,465,364     3,532,783       4,278,341        7,578,341
Deferred income taxes (note 8)............      194,910       164,358              --               --
Obligations under capital leases,                                                                     
  excluding current installments (note                                                                
  7)......................................      301,882       252,841         239,774          239,774
Long-term debt, excluding current portion                                                             
  (note 6)................................    5,255,766     3,883,785       7,090,077        7,090,077
                                            -----------   -----------     -----------      -----------
          Total liabilities...............    9,217,922     7,833,767      11,608,192       14,908,192
                                            -----------   -----------     -----------      -----------
Stockholders' equity:                                                                                 
  Common stock, $.01 par value; 100,000                                                               
     shares authorized, issued and                                                                    
     outstanding..........................        1,000         1,000           1,000            1,000
  Additional paid-in capital..............    2,660,056     2,660,056       2,660,056        2,660,056
  Retained earnings (deficit).............   (1,134,084)      755,622       3,776,735          695,671
                                            -----------   -----------     -----------      -----------
          Total stockholders' equity......    1,526,972     3,416,678       6,437,791        3,356,727
Commitments (note 7)......................                                                            
                                            -----------   -----------     -----------      -----------
                                            $10,744,894   $11,250,445     $18,045,983      $18,264,919
                                            ===========   ===========     ===========      ===========

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF OPERATIONS 

                                                        [Enlarge/Download Table]

                                            PREDECESSOR    SUCCESSOR            SUCCESSOR         
                                            ------------  ------------  ------------------------- 
                                             JANUARY 1,   DECEMBER 1,          YEARS ENDED        
                                            1994 THROUGH  1994 THROUGH        DECEMBER 31,        
                                            NOVEMBER 30,  DECEMBER 31,  ------------------------- 
                                                1994          1994         1995          1996     
                                            ------------  ------------  -----------   ----------- 
                                                                                                  
Revenues:                                                                                         
  Services................................   $4,514,557    $ 366,211    $ 7,003,776   $13,313,509 
  Equipment sales.........................           --           --        267,553       792,285 
  Royalties...............................           --           --        272,863       622,986 
                                             ----------    ---------    -----------   ----------- 
     Total revenues.......................    4,514,557      366,211      7,544,192    14,728,780 
                                             ----------    ---------    -----------   ----------- 
Cost of revenues:                                                                                 
  Cost of equipment.......................           --           --        137,390       588,291 
  Cost of services........................    3,156,042      252,686      5,953,210     7,873,009 
                                             ----------    ---------    -----------   ----------- 
     Total cost of revenue................    3,156,042      252,686      6,090,600     8,461,300 
                                             ----------    ---------    -----------   ----------- 
     Gross margin.........................    1,358,515      113,525      1,453,592     6,267,480 
Selling, general and administrative.......    1,263,637      267,923      2,686,585     2,790,025 
                                             ----------    ---------    -----------   ----------- 
     Operating income (loss)..............       94,878     (154,398)    (1,232,993)    3,477,455 
Other income (expense):                                                                           
  Interest income.........................           --           --         48,750        82,501 
  Interest expense........................      (33,239)          --       (205,542)     (545,432)
                                             ----------    ---------    -----------   ----------- 
                                                (33,239)          --       (156,792)     (462,931)
                                             ----------    ---------    -----------   ----------- 
     Income (loss) from continuing                                                                
       operations before income taxes.....       61,639     (154,398)    (1,389,785)    3,014,524 
  Income tax expense (benefit) (note 8)...      (17,353)     (13,302)      (444,105)    1,124,818 
                                             ----------    ---------    -----------   ----------- 
     Income (loss) from continuing                                                                
       operations.........................       78,992     (141,096)      (945,680)    1,889,706 
Discontinued operations (note 9):                                                                 
  Income (loss) from discontinued                                                                 
     operations, net of income taxes in                                                           
     1994 of $199,807 -- predecessor;                                                             
     $18,164 -- successor and income tax                                                          
     benefit of $422,004 in 1995..........      387,786       35,253       (819,182)           -- 
  Gain from disposal of discontinued                                                              
     operation, net of income taxes of                                                            
     $379,471 in 1995.....................           --           --        736,621            -- 
                                             ----------    ---------    -----------   ----------- 
     Total income (loss) from discontinued                                                        
       operations.........................      387,786       35,253        (82,561)           -- 
                                             ----------    ---------    -----------   ----------- 
     Income (loss) before extraordinary                                                           
       item...............................      466,778     (105,843)    (1,028,241)    1,889,706 
Extraordinary item -- extinguishment of                                                           
  debt, net of income taxes of $53,488 in                                                         
  1994....................................     (103,831)          --             --            -- 
                                             ----------    ---------    -----------   ----------- 
     Net income (loss)....................   $  362,947    $(105,843)   $(1,028,241)  $ 1,889,706 
                                             ==========    =========    ===========   =========== 
Average shares used in per share                                                                  
  computation.............................      100,000      100,000        100,000       100,000 
                                             ==========    =========    ===========   =========== 
Income (loss) per share (historical):                                                             
  Income (loss) continuing operations.....   $      .79    $   (1.41)   $     (9.46)  $     18.90 
  Discontinued operations.................         3.88          .35           (.82)           -- 
  Extraordinary item......................        (1.04)          --             --            -- 
                                             ----------    ---------    -----------   ----------- 
     Net income (loss) per share..........   $     3.63    $   (1.06)   $    (10.28)  $     18.90 
                                             ==========    =========    ===========   =========== 

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF OPERATIONS 

                                                        [Enlarge/Download Table]

                                                                 NINE MONTHS ENDED     
                                                                   SEPTEMBER 30,       
                                                             ------------------------- 
                                                                1996          1997     
                                                             -----------   ----------- 
                                                                    (UNAUDITED)        
                                                                                       
Revenues:                                                                              
  Services.................................................. $ 9,809,601   $13,294,945 
  Equipment sales...........................................     734,122       192,121 
  Royalties.................................................     491,537       509,822 
                                                             -----------   ----------- 
                                                              11,035,260    13,996,888 
                                                             -----------   ----------- 
Cost of revenues:                                                                      
  Cost of equipment.........................................     542,833       176,192 
  Cost of services..........................................   5,704,141     7,615,379 
                                                             -----------   ----------- 
     Total cost of revenues.................................   6,246,974     7,791,571 
                                                             -----------   ----------- 
     Gross margin...........................................   4,788,286     6,205,317 
                                                             -----------   ----------- 
Selling, general and administrative.........................   2,064,486     2,744,142 
                                                             -----------   ----------- 
     Operating income.......................................   2,723,800     3,461,175 
                                                             -----------   ----------- 
Other income (expense):                                                                
  Interest income...........................................      63,751        41,220 
  Interest expense..........................................    (409,496)     (429,322)
                                                             -----------   ----------- 
                                                                (345,745)     (388,102)
                                                             -----------   ----------- 
     Income before taxes....................................   2,378,055     3,073,073 
  Income tax expense (note 8)...............................     879,880        51,960 
                                                             -----------   ----------- 
     Net income............................................. $ 1,498,175   $ 3,021,113 
                                                             ===========   =========== 
Average shares used in per share computation................     100,000       100,000 
                                                             ===========   =========== 
Pro forma income data (note 1):                                                        
  Net earnings as reported..................................               $ 3,021,113 
  Pro forma adjustment to provide for income taxes..........                (1,197,965)
                                                                           ----------- 
  Pro forma net earnings....................................               $ 1,823,148 
                                                                           =========== 
Income per share (historical)............................... $     14.98               
                                                             ===========               
Pro forma income per share (note 1).........................               $     18.23 
                                                                           =========== 

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY 

                                                        [Enlarge/Download Table]

                                                        ADDITIONAL   RETAINED         TOTAL    
                                                COMMON   PAID-IN     EARNINGS     STOCKHOLDERS'
                                                STOCK    CAPITAL     (DEFICIT)       EQUITY    
                                                ------  ----------  -----------   -------------
                                                                                               
PREDECESSOR                                                                                    
  Balances at December 31, 1993................ $1,000  $2,720,605  $  (574,096)   $ 2,147,509 
  Net income...................................    --           --      362,947        362,947 
                                                ------  ----------  -----------    ----------- 
  Balances at November 30, 1994................ $1,000  $2,720,605  $  (211,149)   $ 2,510,456 
                                                ======  ==========  ===========    =========== 
SUCCESSOR                                                                                      
  Formation of Business Resources                                                              
     Corporation............................... 1,000    2,509,456           --      2,510,456 
  Net loss.....................................    --           --     (105,843)      (105,843)
                                                ------  ----------  -----------    ----------- 
  Balances at December 31, 1994................ 1,000    2,509,456     (105,843)     2,404,613 
  Contribution from shareholder................    --      150,600           --        150,600 
  Net loss.....................................    --           --   (1,028,241)    (1,028,241)
                                                ------  ----------  -----------    ----------- 
  Balances at December 31, 1995................ 1,000    2,660,056   (1,134,084)     1,526,972 
  Net income...................................    --           --    1,889,706      1,889,706 
                                                ------  ----------  -----------    ----------- 
  Balances at December 31, 1996................ 1,000    2,660,056      755,622      3,416,678 
  Net income (unaudited).......................    --           --    3,021,113      3,021,113 
                                                ------  ----------  -----------    ----------- 
  Balances at September 30, 1997 (unaudited)... $1,000  $2,660,056  $ 3,776,735    $ 6,437,791 
                                                ======  ==========  ===========    =========== 

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

                                                        [Enlarge/Download Table]

                                             PREDECESSOR     SUCCESSOR            SUCCESSOR         
                                           ---------------  ------------  ------------------------- 
                                           JANUARY 1, 1994  DECEMBER 1,          YEARS ENDED        
                                               THROUGH      1994 THROUGH        DECEMBER 31,        
                                            NOVEMBER 30,    DECEMBER 30,  ------------------------- 
                                                1994            1994         1995          1996     
                                           ---------------  ------------  -----------   ----------- 
                                                                                                    
Cash flows from operating activities:                                                               
  Net income (loss)......................     $ 362,947      $(105,843)   $(1,028,241)  $ 1,889,706 
  Adjustments to reconcile net income                                                               
     (loss) to net cash provided by (used                                                           
     in) operating activities:                                                                      
       Depreciation and amortization.....       254,099         18,546        653,450     1,322,360 
       Write-off of notes receivable.....            --             --        203,876            -- 
       Deferred income taxes.............            --        (20,062)      (486,638)      709,612 
       Gain from disposal of discontinued                                                           
          operations.....................            --             --     (1,116,092)           -- 
       (Gain) loss on sale of                                                                       
          equipment......................            --             --        133,196       (31,400)
       Changes in operating assets and                                                              
          liabilities, net of the effect                                                            
          of acquisitions and                                                                       
          divestitures:                                                                             
            Accounts receivable..........      (263,396)        95,890     (1,197,318)     (425,514)
            Prepaid expenses and other...        11,033          1,155         (6,100)     (123,516)
            Accounts payable.............      (115,710)        67,223        563,826      (201,503)
            Accrued expenses.............      (228,730)       126,464      1,491,683      (704,309)
            Other assets.................       (75,659)          (744)       (20,365)      (36,854)
                                              ---------      ---------    -----------   ----------- 
               Net cash provided by (used                                                           
                 in) operating                                                                      
                 activities..............       (55,416)       182,629       (808,723)    2,398,582 
                                              ---------      ---------    -----------   ----------- 
Cash flows from investing activities:                                                               
  Acquisitions, net of cash acquired.....            --             --       (611,170)      (50,000)
  Purchases of property and equipment....            --             --     (2,459,273)   (1,960,216)
  Proceeds from sale of equipment........            --             --             --       122,444 
  Issuance of note receivables...........       (31,500)            --         (6,600)      (10,000)
  Proceeds received on notes                                                                        
     receivable..........................            --             --         66,000       260,000 
                                              ---------      ---------    -----------   ----------- 
               Net cash used in investing                                                           
                 activities..............       (31,500)            --     (3,011,043)   (1,637,772)
                                              ---------      ---------    -----------   ----------- 
Cash flows from financing activities:                                                               
  Proceeds from notes payable............            --             --      5,750,000       170,000 
  Principal payments on notes payable....            --             --     (1,563,989)     (987,557)
  Principal payments on capital leases...            --             --        (47,548)     (168,327)
                                              ---------      ---------    -----------   ----------- 
               Net cash provided by (used                                                           
                 in) financing                                                                      
                 activities..............            --             --      4,138,463      (985,884)
                                              ---------      ---------    -----------   ----------- 
Increase (decrease) in cash and cash                                                                
  equivalents............................       (86,916)       182,629        318,697      (225,074)
Cash and cash equivalents at beginning of                                                           
  period.................................        58,062        (28,854)       153,775       472,472 
                                              ---------      ---------    -----------   ----------- 
Cash and cash equivalents at end of                                                                 
  period.................................     $ (28,854)     $ 153,775    $   472,472   $   247,398 
                                              =========      =========    ===========   =========== 
Supplemental disclosures:                                                                           
  Cash paid during the period for                                                                   
     interest............................     $ 174,694      $  15,881    $   139,852   $   627,439 
                                              =========      =========    ===========   =========== 
  Cash paid during the period for income                                                            
     taxes...............................     $      --      $      --    $        --   $   325,000 
                                              =========      =========    ===========   =========== 

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

                                                        [Enlarge/Download Table]

                                                                  NINE MONTHS ENDED     
                                                                    SEPTEMBER 30,       
                                                              ------------------------- 
                                                                 1996          1997     
                                                              -----------   ----------- 
                                                                     (UNAUDITED)        
                                                                                        
Cash flows from operating activities:                                                   
  Net income................................................  $ 1,498,175   $ 3,021,113 
  Adjustments to reconcile net income to net cash provided                              
     by operating activities:                                                           
     Depreciation and amortization..........................      934,347     1,182,916 
     Deferred income taxes..................................      899,944       (74,813)
     Changes in operating assets and liabilities, net of the                            
      effect of acquisitions and divestitures:                                          
       Accounts receivable..................................     (282,245)   (1,249,335)
       Prepaid expenses and other...........................      (76,097)       40,309 
       Accounts payable.....................................     (344,875)     (220,904)
       Accrued expenses.....................................     (763,272)      416,285 
       Other assets.........................................      (64,019)        7,818 
                                                              -----------   ----------- 
          Net cash provided by operating activities.........    1,801,958     3,123,389 
                                                              -----------   ----------- 
Cash flows from investing activities:                                                   
  Acquisitions, net of cash acquired........................      (50,000)           -- 
  Purchases of property and equipment.......................   (1,602,525)     (888,957)
  Proceeds from sale of equipment...........................       91,043            -- 
  Issuance of note receivables..............................      (10,000)           -- 
  Proceeds received on notes receivable.....................      187,500       937,500 
                                                              -----------   ----------- 
          Net cash provided by (used in) investing                                      
            activities......................................   (1,383,982)       48,543 
                                                              -----------   ----------- 
Cash flows used in financing activities:                                                
  Proceeds from notes payable...............................      170,000        21,960 
  Principal payments on notes payable.......................     (780,239)   (2,458,250)
  Principal payments on capital leases......................     (142,276)     (124,017)
                                                              -----------   ----------- 
          Net cash used in financing activities.............     (752,515)   (2,560,307)
                                                              -----------   ----------- 
Increase (decrease) in cash and cash equivalents............     (334,539)      611,625 
Cash and cash equivalents at beginning of period............      472,472       247,398 
                                                              -----------   ----------- 
Cash and cash equivalents at end of period..................  $   137,933   $   859,023 
                                                              ===========   =========== 
Supplemental disclosures:                                                               
  Cash paid during the period for interest..................  $   585,769   $   534,890 
                                                              ===========   =========== 
  Cash paid during the period for income taxes..............  $        --   $   244,087 
                                                              ===========   =========== 
Noncash financing activities:                                                           
  Issuance of note payable relating to the acquisition of                               
     title services division (see note 13)..................  $        --   $ 6,000,000 
                                                              ===========   =========== 

See accompanying notes to consolidated financial statements.

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(INFORMATION AS OF SEPTEMBER 30, 1997 AND FOR THE NINE MONTHS 
ENDED SEPTEMBER 30, 1996 AND 1997 IS UNAUDITED) 

(1) GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                      

(a) Description of Business                                                 

     Business Resources Corporation and subsidiaries (the "Company") are engaged
in providing a full complement of advanced information management systems and   
integrated applications, including data processing outsourcing, for county and  
municipal governments. The majority of the Company's customers are located in   
the Southwestern United States. Government Record Services, Inc. ("GRS") is the 
largest subsidiary and conducts primarily all business operations for the       
Company. GRS provides a comprehensive set of computerized client/server systems 
on a number of computer hardware platforms to fully automate all functions      
relating to county government operations.                                       

     Business Resources Corporation ("Resources") was formed by the sole class A
shareholder in 1993 to serve as a holding company. On December 1, 1994,         
Resources acquired GRS and Reliable Tax Service ("RTS") from American Title     
Group, Inc. ("ATG"). The sole class A shareholder in Resources held a non-      
controlling interest in ATG at the time of the acquisition.                     

    Prior to December 1, 1994, the net assets of GRS and RTS were part of ATG.
Effective December 1, 1994, these net assets were conveyed to the sole class A  
shareholder of the Company in exchange for the ATG common stock held by the sole
class A shareholder and the forgiveness of certain notes payable to such        
shareholder. The cost of acquisition of $2,510,456 was allocated on the basis of
the estimated fair values of the assets acquired and the liabilities assumed,   
which approximated the net carrying values of GRS and RTS' net assets prior to  
the acquisition. The financial information for the period from January 1, 1994  
to November 30, 1994 reflects the historical cost of the assets and liabilities 
of GRS and RTS and its operating results and has been referred to as            
"Predecessor" in the accompanying consolidated financial statements.            

(b) Principles of Consolidation                                             

  The consolidated financial statements include the operations of Business
Resources Corporation and its wholly-owned subsidiaries. All significant        
intercompany balances and transactions have been eliminated in consolidation.   

(c) Cash Equivalents                                                        

Cash equivalents consists of short-term highly liquid investment with 
original maturities of three months or less. There were no cash equivalents at  
December 31, 1994, 1995 and 1996.                                               

(d) Property and Equipment                                                  

Property and equipment are recorded at cost and are depreciated over  
estimated lives ranging from 5 to 20 years using the straight-line method.      
Property and equipment held under capital leases and leasehold improvements are 
amortized on the straight-line method over the shorter of the lease term or     
estimated useful life of the asset.                                             

(e) Income Taxes                                                            

     Effective January 1, 1997, the Company converted from a C Corporation to an
S Corporation. As an S Corporation, the consequences of all profits and losses  
are the responsibilities of the shareholder of the Company.                     

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

The unaudited pro forma provision for income taxes for the nine months
ended September 30, 1997 presented on the statement of operations represents the
estimated taxes that would have been recorded had the Company been a C          
Corporation for income tax purposes for that period.                            

     Prior to January 1, 1997 the Company used the asset and liability method of
accounting for deferred income taxes in its historical consolidated financial   
statements. Deferred tax assets and liabilities are recognized with respect to  
tax consequences attributable to the differences between the financial statement
carrying amounts and the tax bases of existing assets and liabilities. Deferred 
tax assets and liabilities are measured using enacted tax rates expected to be  
in effect when such amounts are realized or settled. The resulting deferred tax 
assets and liabilities are adjusted to reflect changes in tax laws or rates in  
the period of enactment.                                                        

(f) Intangible Assets                                                       

Intangible assets consists of the following:                          

                                                        [Enlarge/Download Table]

                                                    DECEMBER 31,                      
                                              ------------------------   SEPTEMBER 30,
                                                 1995          1996          1997     
                                              ----------    ----------   -------------
                                                                          (UNAUDITED) 
                                                                                      
Goodwill..................................... $  380,117    $  430,117    $  530,117  
Noncompete agreements........................    762,645     1,094,887     1,094,887  
Other........................................    132,000       201,649       243,755  
Purchased title plant........................         --            --     5,480,000  
                                              ----------    ----------    ----------  
                                               1,274,762     1,726,653     7,348,759  
Less accumulated amortization................   (287,048)     (482,809)     (660,090) 
                                              ----------    ----------    ----------  
                                              $  987,714    $1,243,844    $6,688,669  
                                              ==========    ==========    ==========  

    Goodwill, which represents the excess of purchase price over fair value of
identifiable net assets acquired, is amortized on a straight-line basis over the
expected periods to be benefited, generally up to 40 years. Goodwill            
amortization of $17,892 and $27,285 was recorded for the years ended December   
31, 1995 and 1996, respectively (none in 1994). The Company assesses the        
recoverability of this intangible asset by determining whether the amortization 
of the goodwill balance over its remaining life can be recovered through        
undiscounted future operating cash flows. The amount of goodwill impairment, if 
any, is measured based on projected discounted future operating cash flows using
a discount rate reflecting the Company's average cost of funds. The assessment  
of the recoverability of goodwill will be impacted if estimated future operating
cash flows are not achieved.                                                    

The cost of noncompete agreements are amortized straight-line over the
lives of the respective contracts. Amortization expense related to the          
noncompete agreements amounted to $116,512 for the period from January 1, 1994  
through November 30, 1994 (predecessor) and $10,592 for the period from December
1, 1994 through December 31, 1994 (successor) and $127,104 and $751,330 for the 
years ended December 31, 1995 and 1996, respectively.                           

(g) Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of 

The Company adopted the provisions of SFAS No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, on 
January 1, 1996. This Statement requires that long-lived assets and certain     
identifiable intangibles be reviewed for impairment whenever events or changes  
in circumstances indicate that the carrying amount of an asset may not be       
recoverable. Recoverability of assets to be held and used is measured by a      
comparison of the carrying amount of an asset to future net cash flows expected 
to be generated by the asset. If such assets are considered to be impaired, the 
impairment to be                                                                

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recognized is measured by the amount by which the carrying amount of the assets 
exceed the fair value of the assets. Assets to be disposed of are reported at   
the lower of the carrying amount or fair value less costs to sell. Adoption of  
this Statement did not have a material impact on the Company's financial        
position, results of operations, or liquidity.                                  

(h) Revenue                                                                 

The Company recognizes service revenue when services are performed and
equipment sales when the products are shipped. Royalties relate to the current  
activities of Professional Real Estate Tax Services, Inc. and RTS which were    
sold in 1995, and are recognized as earned upon receipt of royalty payments by  
the Company.                                                                    

(i) Use of Estimates                                                        

  The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and        
assumptions that affect the amounts reported in the consolidated financial      
statements and accompanying notes. Actual results could differ from those       
estimates.                                                                      

(j) Income (Loss) per Share                                                 

   Income (loss) per share is based upon the weighted averages common shares
outstanding. There were no common stock equivalents for any of the periods in   
the three-year period ended December 31, 1996.                                  

(k) Unaudited Interim Financial Information                                 

    Interim information for the nine months ended September 30, 1996 and 1997,
including such information in the notes to the financial statements, is         
unaudited. This information has been prepared on the same basis as the annual   
financial statements and, in the opinion of the Company's management, reflects  
all adjustments, consisting of normal recurring adjustments considered necessary
for a fair presentation of the results of such period. Financial results for the
interim period are not necessarily indicative of the results for a full year.   

(l) Pro forma Balance Sheet (Unaudited)                                     

In connection with the proposed acquisition of the Company by Tyler   
Corporation, the Company will terminate its S Corporation status (see note 14). 

     The September 30, 1997 pro forma consolidated balance sheet (unaudited) has
been adjusted to reflect (i) the payment of dividends to the Company's sole     
class A shareholder in 1997 in the estimated amount of $3,300,000 in respect of 
the remaining federal tax liabilities attributable to the Company's Subchapter S
earnings for the nine months ended September 30, 1997 and (ii) the establishment
of deferred income tax assets of $218,936 that would have been required if the  
Company had terminated its S Corporation status as of September 30, 1997.       

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

(2) PROPERTY AND EQUIPMENT                                                      

Property and equipment consists of the following:                     

                                                        [Enlarge/Download Table]

                                                    DECEMBER 31,                       
                                              -------------------------   SEPTEMBER 30,
                                                 1995          1996           1997     
                                              ----------    -----------   -------------
                                                                           (UNAUDITED) 
                                                                                       
Computer hardware and software (note 7)...... $2,036,742    $ 3,124,415    $ 4,252,640 
Property and equipment.......................  2,758,795      3,334,089      3,602,181 
Leasehold improvements.......................  1,254,081      1,492,101      1,544,335 
                                              ----------    -----------    ----------- 
                                               6,049,618      7,950,605      9,399,156 
Less accumulated depreciation and                                                      
  amortization...............................   (662,239)    (1,723,371)    (2,731,168)
                                              ----------    -----------    ----------- 
                                              $5,387,379    $ 6,227,234    $ 6,667,988 
                                              ==========    ===========    =========== 

(3) ACCRUED EXPENSES                                                            

Accrued expenses consisted of the following:                          

                                                                [Download Table]

                                                                  DECEMBER 31,     
                                                             ----------------------
                                                                1995         1996  
                                                             ----------    --------
                                                                                   
Contingent claims on discontinued operations................ $  185,855    $     --
Deferred rent (notes 7 and 11)..............................    218,991     262,538
Payroll and related.........................................    485,100          --
Other.......................................................    759,741     592,634
                                                             ----------    --------
                                                             $1,649,687    $855,172
                                                             ==========    ========

(4) FINANCIAL INSTRUMENTS                                                       

The carrying value of financial instruments such as cash equivalents, 
accounts receivable, accounts payable and accrued expenses approximate their    
fair value.                                                                     

     Based upon the borrowing rates available to the Company for bank loans with
similar terms and average maturities, the fair value of the notes payable and   
long-term debt is $6,086,168 and $5,623,237 at December 31, 1995 and 1996,      
respectively. The corresponding carrying value is $6,212,917 and $5,727,602 at  
December 31, 1995 and 1996, respectively.                                       

(5) NOTES AND OTHER RECEIVABLES                                                 

    Notes receivable consists of five-year unsecured notes bearing interest at
8%, payable in quarterly installments with a total balance due of $1,187,500    
(937,500 long-term) and $937,500 ($687,500 long-term) at December 31, 1995 and  
1996, respectively. The notes receivable resulted from the sale of Professional 
Real Estate Tax Services, Inc. and RTS (see note 9).                            

Unaudited -- Other receivables at September 30, 1997 of $1,308,508    
($728,115 long-term) represent amounts due from various governmental units for  
services performed that are not currently billable to the customer solely due to
the payment terms of their respective service agreements. Revenue related to the
services has been recognized as all of the related services have been performed,
and there are no future obligations or uncertainties remaining. The amount of   
other receivables with payment terms greater than one year are discounted to    
present value. The unamortized discount is amortized over the payment term. The 
Company has evaluated the fiscal funding of the governmental agencies for which 
the services have been performed and have determined the likelihood of          
noncollection of the receivables as remote. The amounts are being paid monthly, 
up to 84 months, and are noninterest bearing. The noninterest bearing           
receivables have                                                                

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been discounted based upon an imputed interest rate range of 7.8% to 8.8% and   
the unamortized discount as of September 30, 1997 was $153,084.                 

(6) LONG-TERM DEBT                                                              

Long-term debt consists of the following:                             

                                                        [Enlarge/Download Table]

                                                       DECEMBER 31,                      
                                                 ------------------------   SEPTEMBER 30,
                                                    1995         1996           1997     
                                                 ----------   -----------   -------------
                                                                             (UNAUDITED) 
                                                                                         
Revolving credit facility......................  $  500,000   $   500,000    $        -- 
8% promissory note payable, payable in                                                   
  quarterly installments through September                                               
  2000, collateralized by certain assets.......     405,000       317,941        261,675 
8% promissory note payable, payable in                                                   
  quarterly installments through September                                               
  2005, collateralized by certain assets.......   1,325,000     1,209,812      1,135,753 
Installment notes, interest at the prime rate                                            
  plus .5%, 9% at September 30, 1997, due                                                
  1996-2000, collateralized by certain                                                   
  assets.......................................   3,687,500     2,926,831      1,351,327 
6.1% unsecured installment note payable, annual                                          
  installments August 1997-August 2002.........     230,906       230,906        209,986 
7% promissory note payable, payable in annual                                            
  installments through August 1998,                                                      
  collateralized by certain assets.............          --       170,000         85,000 
10% unsecured installment notes payable,                                                 
  monthly installments through May 2004........          --       313,318        291,089 
9% promissory note payable, payable in monthly                                           
  installments through February 2001,                                                    
  collateralized by certain assets and the                                               
  capital stock of Title Records Corporation                                             
  and Government Records Services, Inc.,                                                 
  wholly-owned subsidiaries of the Company                                               
  (note 13)....................................          --            --      5,895,000 
Other..........................................      64,511        58,794        112,982 
                                                 ----------   -----------    ----------- 
          Total................................   6,212,917     5,727,602      9,342,812 
Less current portion...........................    (957,151)   (1,843,817)    (2,252,735)
                                                 ----------   -----------    ----------- 
          Total long-term debt.................  $5,255,766   $ 3,883,785    $ 7,090,077 
                                                 ==========   ===========    =========== 

     In November 1995, the Company entered into a revolving credit facility with
a bank providing for borrowings of up to $500,000. In April 1996, the Company   
entered into an amended agreement that provides for borrowings of up to         
$1,000,000 and was scheduled to mature April 10, 1997 and bear interest at the  
prime rate (8.25% at December 31, 1996).                                        

The agreement contains various financial covenants and is secured by  
certain assets of the Company.                                                  

     Unaudited -- The credit facility matured on April 10, 1997 and was renewed.
Borrowings under the amended agreement are due on April 10, 1998 and bear       
interest at the prime rate (8.5% on September 30, 1997).                        

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The aggregate maturities of long-term debt for each of the five years 
subsequent to December 31, 1996 are as follows: 1997, $1,843,817; 1998,         
$1,448,894; 1999, $907,032; 2000, $476,227; 2001, $235,301; thereafter,         
$816,331.                                                                       

(7) LEASES                                                                      

Capital leases consist principally of leases for various computer     
equipment. The gross amounts of property and equipment and related accumulated  
amortization recorded under capital leases at December 31, 1995 and 1996 are as 
follows:                                                                        

                                                                [Download Table]

                                                               1995       1996    
                                                             --------   --------- 
                                                                                  
Furniture and fixtures...................................... $126,363   $ 130,426 
Computer hardware and software..............................  346,606     509,474 
                                                             --------   --------- 
                                                              472,969     639,900 
Less accumulated amortization...............................  (41,576)   (209,903)
                                                             --------   --------- 
                                                             $431,393   $ 429,997 
                                                             ========   ========= 

  The Company has also entered into various operating leases, including an
operating lease with the sole shareholder of the Company for its office building
(see note 11). Rent expense incurred in connection with operating leases was    
approximately $88,000 for the period from January 1, 1994 through November 30,  
1994 (predecessor) and $37,000 for the period from December 1, 1994 through     
December 31, 1994 (successor) and $454,000 and $633,000 for the years ended     
December 31, 1995 and 1996, respectively. The Company records rent expenses     
relating to the building lease on a straight-line basis over the lease term. As 
a result of certain lease escalations, the Company has recorded deferred rent of
approximately $218,000 and $263,000 at December 31, 1995 and 1996, respectively.

  Future minimum payments, by year and in the aggregate, under the capital
leases and the operating lease consisted of the following at December 31, 1996: 

                                                        [Enlarge/Download Table]

                        YEAR ENDING                            CAPITAL     OPERATING 
                        DECEMBER 31                            LEASES        LEASE   
------------------------------------------------------------  ---------   -----------
                                                                                     
1997........................................................  $ 215,859   $   588,480
1998........................................................    150,548       588,480
1999........................................................     78,374       588,480
2000........................................................     59,218       588,480
2001........................................................      7,685       625,260
Subsequent to 2001..........................................         --     9,305,340
                                                              ---------   -----------
          Total minimum lease payments......................    511,684   $12,284,520
                                                                          ===========
Less amounts representing interest (at rates ranging from 6%                         
  to 8%)....................................................    (81,687)             
                                                              ---------              
     Present value of minimum capital lease payments........    429,997              
Less current installments of obligations under capital                               
  leases....................................................   (177,156)             
                                                              ---------              
  Obligations under capital leases, excluding current                                
     installments...........................................  $ 252,841              
                                                              =========              

Amortization of assets held under capital leases is included with     
depreciation and amortization expense.                                          

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

(8) INCOME TAXES                                                                

Total income tax expense (benefit) is allocated as follows:           

                                                        [Enlarge/Download Table]

                                         JANUARY 1,   DECEMBER 1,                           
                                          1994 TO       1994 TO     YEARS ENDED DECEMBER 31,
                                        NOVEMBER 30,  DECEMBER 31,  ------------------------
                                            1994          1994         1995         1996    
                                        ------------  ------------  ----------   -----------
                                                                                            
Income (loss) from continuing                                                               
  operations...........................   $(17,353)     $(13,302)    $(444,105)   $1,124,818
Discontinued operations................    199,807        18,164       (42,533)           --
Extraordinary item.....................     53,488            --            --            --
                                          --------      --------     ---------    ----------
                                          $235,942      $  4,862     $(486,638)   $1,124,818
                                          ========      ========     =========    ==========

    Income tax expense (benefit) attributable to income (loss) from continuing
operations taxes before income taxes consists of:                               

                                                        [Enlarge/Download Table]

                                                    CURRENT    DEFERRED      TOTAL    
                                                    --------   ---------   ---------- 
                                                                                      
January 1, 1994 to November 30, 1994                                                  
  U.S. Federal..................................... $ (5,996)  $ (11,357)  $  (17,353)
                                                    ========   =========   ========== 
December 1, 1994 to December 31, 1994                                                 
  U.S. Federal..................................... $ (4,597)  $  (8,705)  $  (13,302)
                                                    ========   =========   ========== 
Year ended December 31, 1995:                                                         
  U.S. Federal..................................... $     --   $(444,105)  $ (444,105)
                                                    ========   =========   ========== 
Year ended December 31, 1996:                                                         
  U.S. Federal..................................... $364,379   $ 622,745   $  987,124 
  State taxes......................................   50,827      86,867      137,694 
                                                    --------   ---------   ---------- 
                                                    $415,206   $ 709,612   $1,124,818 
                                                    ========   =========   ========== 

  Prior to December 1, 1994, the results of operations of the Company were
included in the consolidated U.S. federal income tax return of ATG. Total       
current and deferred income taxes were allocated to the Company as if the       
Company had not been eligible to be included in the consolidated tax return of  
ATG (that is, the Company on a stand-alone basis). The recognition and          
measurement of current and deferred income taxes required certain assumptions,  
allocations and significant estimates which management believes are reasonable  
to measure the tax consequences as if the Company were a stand-alone taxpayer.  
The Company's allocated income tax expense was determined in accordance with the
asset and liability method of accounting for income taxes.                      

    Income tax expense (benefit) attributable to income (loss) from continuing
operations differs from the amount computed by applying the U.S. federal tax    
rate of 34% to pretax income (loss) from continuing operations as follows:      

                                                        [Enlarge/Download Table]

                                      JANUARY 1,   DECEMBER 1,        YEARS ENDED      
                                       1994 TO       1994 TO          DECEMBER 31,     
                                     NOVEMBER 30,  DECEMBER 31,  ----------------------
                                         1994          1994        1995         1996   
                                     ------------  ------------  ---------   ----------
                                                                                       
Computed "expected" tax expense                                                        
  (benefit).........................   $ 20,957      $(52,495)   $(472,527)  $1,024,938
Effect of state and local taxes.....         --            --           --       90,435
Other...............................    (38,310)       39,193       28,422        9,445
                                       --------      --------    ---------   ----------
                                       $(17,353)     $(13,302)   $(444,105)  $1,124,818
                                       ========      ========    =========   ==========

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

The tax effects of temporary differences that gave rise to significant
portions of the deferred tax assets and liabilities at December 31, 1995 and    
1996 are presented below:                                                       

                                                                [Download Table]

                                                                1995        1996    
                                                              ---------   --------- 
                                                                                    
Deferred tax assets:                                                                
  Net operating loss carryforwards..........................  $ 666,400   $      -- 
  Deferred rent.............................................     74,216      96,509 
  Other.....................................................    154,840      55,594 
                                                              ---------   --------- 
          Total deferred tax assets.........................    895,456     152,103 
                                                              ---------   --------- 
Deferred tax liabilities:                                                           
  Realized gain on sale of assets, recognized on installment                        
     basis for tax purposes.................................   (374,456)   (340,715)
  Other.....................................................    (14,666)    (14,666)
                                                              ---------   --------- 
          Total deferred tax liabilities....................   (389,122)   (355,381)
                                                              ---------   --------- 
          Net deferred tax assets (liabilities).............  $ 506,334   $(203,278)
                                                              =========   ========= 

Deferred tax assets and liabilities are computed by applying the U.S. 
federal income tax rate in effect to the gross amounts of temporary differences 
and other tax attributes, such as net operating loss carryforwards. In assessing
the reliability of deferred tax assets, the Company considers whether it is more
likely than not that some portion or all of the deferred tax assets will not be 
realized. Accordingly, management believes a valuation reserve is not considered
necessary at this time.                                                         

    Unaudited -- The historical provision for income taxes for the nine months
ended September 30, 1997 of $51,960 consists of approximately $84,000 of state  
income taxes, the elimination of existing deferred tax liabilities at January 1,
1997 of approximately $203,000 (the effective date when the Company changed from
C Corporation to S Corporation status) and a charge to 1997 operations for a    
revision of 1996 estimated income taxes primarily attributable to tax effected  
temporary differences and prior year rate adjustments.                          

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(9) DISCONTINUED OPERATIONS                                                     

    In 1995, the Company elected to discontinue operations relating to several
lines of business. A description of each discontinued operation and the income  
(loss) from discontinued operations for the period from January 1, 1994 through 
November 30, 1994 (predecessor) and the period from December 1, 1994 through    
December 31, 1994 and the year ended December 31, 1995 follows:                 

                                                        [Enlarge/Download Table]

                                                PREDECESSOR            SUCCESSOR          
                                                ------------  ----------------------------
                                                 JANUARY 1,   DECEMBER 1,                 
                                                1994 THROUGH  1994 THROUGH     YEAR ENDED 
                                                NOVEMBER 30,  DECEMBER 31,    DECEMBER 31,
                                                    1994          1994            1995    
                                                ------------  ------------    ------------
                                                                                          
Computer Election Systems, Inc.: Provider of                                              
  ballot cards for elections. The related                                                 
  assets were sold in 1995 in exchange for                                                
  certain assets of Business Records                                                      
  Corporation (see note 10). Revenue was                                                  
  $250,345 for the year ended December 31,                                                
  1995 and approximately the same in 1994.....    $     --      $    --        $(213,035) 
Professional Real Estate Tax Services, Inc.                                               
  and American Business Corporation dba                                                   
  Reliable Tax Service: Primarily engaged in                                              
  the business of providing tax certificates.                                             
  The related assets were sold in 1995 in                                                 
  exchange for notes receivable (see note 5).                                             
  Revenue was $1,514,924 for the year ended                                               
  December 31, 1995 and approximately in the                                              
  same in 1994. The Company recorded a gain on                                            
  disposal of $736,621, net of tax, relating                                              
  to the sale.................................     388,011       35,274          578,224  
San Antonio Data, Inc.: Primarily engaged in                                              
  the business of updating information for a                                              
  title plant in Bexar County. The Company's                                              
  stock was exchanged for the stock of                                                    
  Professional Real Estate Tax Services, Inc.                                             
  Revenue was $35,980 for the year ended                                                  
  December 31, 1995 and $-0- in 1994..........        (225)         (21)            (470) 
Nashoba Corporation: Primarily engaged in the                                             
  business of ranching and sale of cattle. The                                            
  related assets were sold to the sole                                                    
  shareholder of the Company in 1995 (see note                                            
  11). Revenue was $103,116 for the year ended                                            
  December 31, 1995 and $-0- in 1994..........          --           --         (447,280) 
                                                  --------      -------        ---------  
                                                  $387,786      $35,253        $ (82,561) 
                                                  ========      =======        =========  

     Operating results for 1994 and 1995 from each discontinued line of business
have been reclassified and included in discontinued operations.                 

(10) Acquisition                                                            

In September 1995, the Company acquired certain assets of an unrelated
third party, Business Records Corporation in exchange for the assets of its land
records business in the Southeastern United States and the assets of Computer   
Election Systems, Inc., a provider of ballot cards for elections, and two notes 
payable in                                                                      

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the total amount of $1,730,000. The operations acquired from Business Records   
Corporation provide services to county and municipal governments similar to     
those provided by GRS. For financial reporting purposes, the transaction has    
been accounted for under the purchase method of accounting with the total       
purchase price of approximately $2,337,000 allocated to the net assets acquired 
on the estimated fair values of assets acquired and liabilities assumed.        
Approximately $100,000 was recorded to goodwill as a result of the transaction. 

The following summarizes the unaudited consolidated pro forma data as 
though the acquisition of Business Records Corporation had occurred as of the   
beginning of 1995:                                                              

                                                                [Download Table]

                                                                 1995            
                                                      -------------------------- 
                                                      HISTORICAL      PRO FORMA  
                                                      -----------    ----------- 
                                                                     (UNAUDITED) 
                                                                                 
Revenues from continuing operations.................. $ 7,544,192    $10,644,193 
Net loss.............................................  (1,028,241)      (775,240)
Net loss per share...................................      (1,028)          (775)

(11) RELATED PARTY TRANSACTIONS                                                 

     In 1995, the Company entered into a 246 month lease agreement with the sole
class A shareholder of the Company for its current office building. The lease   
agreement is due to expire in December 2015. Rent expense under the lease       
agreement amounted to approximately $316,000 and $632,700 in 1995 and 1996,     
respectively.                                                                   

     In 1995, the Company operated a cattle ranch which was discontinued in 1995
with no gain or loss recorded as a result of the disposition of this operation  
to the Company's sole shareholder. Results of operations in 1995 related to the 
cattle ranch operations have been included in discontinued operations (see note 
9).                                                                             

(12) EXTRAORDINARY ITEM                                                         

 In November 1994, the Company paid off certain notes payable associated
with certain noncompete agreements in advance of the scheduled payment term. The
premium associated with the extinguishment was $157,319 and represented the     
incremental interest which would have been paid had the notes been paid         
according to the original payment term. The Company has reported the            
extinguishment of debt as an extraordinary item of $103,831, net of income tax  
benefit of $53,488.                                                             

(13) ACQUISITION OF TITLE PLANT (UNAUDITED)                                     

    Effective July 31, 1997, the Company (through Title Records Corporation, a
wholly-owned subsidiary) acquired certain assets of the title services division 
of Business Records Corporation. The acquisition was accounted for as a purchase
business combination and, accordingly, the purchase price of $6,000,000 was     
allocated to the acquired assets based upon the estimated fair values of the    
underlying assets. The purchase price was allocated, as follows:                

                                                                [Download Table]
                                                                        
Computer hardware and software..............................  $  319,000
Property and equipment......................................     181,000
Intangible assets:                                                      
  Title plant...............................................   5,400,000
  Goodwill..................................................     141,896
                                                              ----------
          Total purchase price..............................  $6,041,896
                                                              ==========

    Purchased title plant represents the allocation of purchase price based on
estimated fair value of certain assets acquired from Business Records           
Corporation. A title plant constitutes a historical record of all matters       
affecting title to parcels of land in a particular geographic region. In        
accordance with SFAS No. 61,                                                    

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BUSINESS RESOURCES CORPORATION AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 

"Accounting for Title Plant," the capitalized costs of the title plant are not  
depreciated unless circumstances indicate that the value of the title plant has 
been impaired.                                                                  

The purchase price has been preliminarily allocated based primarily on
information furnished by management of the company from which the assets were   
acquired. The final allocation of the purchase price will be determined within  
one year of consummation of the purchase and will be based on the estimated fair
values of the assets acquired and the liabilities assumed. Accordingly, the     
information presented herein may differ from the final purchase price           
allocation.                                                                     

     The Company financed the acquisition through the issuance of a note payable
to Business Records Corporation for $6,000,000 (note 6). The remaining purchase 
price of $41,896 relates to direct acquisition costs incurred by the Company.   

(14) SUBSEQUENT EVENTS (UNAUDITED)                                              

 On October 8, 1997, the Company and the sole shareholder of the Company
entered into an agreement with Tyler Corporation ("Tyler"), a publicly-held     
company listed on the New York Stock Exchange, whereby the Company will merge   
into a newly-formed subsidiary of Tyler (the "Merger"). Under the terms of the  
Merger and other related transactions, and as adjusted for the recapitalization 
discussed below, the principal shareholder, who owns 87,650 shares of issued and
outstanding common stock, will receive $15,250,000 in cash and 8,765,000 shares 
of common stock of Tyler. Certain key employees, who currently or are           
anticipated to own 12,350 shares of the Company's remaining issued and          
outstanding stock, will receive 1,235,000 shares of common stock of Tyler. The  
Merger is subject to approval by the shareholders of Tyler and is expected to   
close in January 1998.                                                          

In December 1997, the Company recapitalized its capital structure to  
increase its authorized, issued and outstanding shares of common stock from     
1,000 shares to 100,000 shares. The effects of the recapitalization have been   
applied retroactively for all periods presented in the accompanying consolidated
financial statements. Of the 100,000 shares now issued and outstanding, 87,650  
shares consist of class A common stock and 12,350 shares consist of class B     
common stock. The class A and class B common stock have substantially equivalent
rights, except that the class B stock is non-voting stock. On December 15, 1997,
the sole class A shareholder of the Company transferred 10,000 shares of his    
class B common stock to key employees of the Company and its subsidiaries. The  
transfer of such shares was not subject to future service requirements. The     
Company will record compensation expense related to this transfer in December,  
1997 in the amount of $2,625,000. On January 2, 1998, the sole class A          
shareholder of the Company transferred an additional 2,350 shares of his class B
common stock to other key employees. The Company will record compensation       
expense related to this transfer in January, 1998. The effects of the           
transferring such shares to employees will be recorded in the preacquisition    
results of operations of the Company and will not impact the net assets of the  
Company.                                                                        

  On December 30, 1997, Tyler loaned $5,700,000 to the Company for working
capital purposes. The unsecured loan bears interest at 8.5%, payable quarterly, 
and matures on September 30, 1999, unless the Merger is terminated, in which    
case the loan becomes payable at various dates depending on the circumstances   
causing the Merger to be terminated.                                            

On December 31, 1997, the Company paid dividends to the Company's sole
class A shareholder of $3,300,000 relating to 1997 federal tax liabilities and  
terminated its S Corporation status as of that date.                            

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INDEPENDENT AUDITORS' REPORT

The Board of Directors                                                          
The Software Group, Inc.:                                                       

     We have audited the accompanying balance sheets of The Software Group, Inc.
as of October 31, 1996 and 1997, and the related statements of operations,      
stockholders' equity and cash flows for the years then ended. These financial   
statements are the responsibility of the Company's management. Our              
responsibility is to express an opinion on these financial statements based on  
our audits.                                                                     

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain 
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting 
the amounts and disclosures in the financial statements. An audit also includes 
assessing the accounting principles used and significant estimates made by      
management, as well as evaluating the overall financial statement presentation. 
We believe that our audits provide a reasonable basis for our opinion.          

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of The Software Group, Inc., as
of October 31, 1996 and 1997, and the results of its operations and its cash    
flows for the years then ended, in conformity with generally accepted accounting
principles.                                                                     

                                  /s/  KPMG PEAT MARWICK LLP

                             KPMG PEAT MARWICK LLP

Dallas, Texas                                                                   
December 19, 1997                                                               

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THE SOFTWARE GROUP, INC.

BALANCE SHEETS

ASSETS

                                                        [Enlarge/Download Table]

                                                        OCTOBER 31,   JULY 31,    OCTOBER 31,
                                                           1996         1997         1997    
                                                        -----------  -----------  -----------
                                                                     (UNAUDITED)             
                                                                                             
Current assets:                                                                              
  Cash and cash equivalents...........................  $1,782,874    $2,815,828  $2,807,322 
  Accounts receivable, net of allowance of $30,000 at                                        
     October 31, 1996 and July 31, 1997 and $90,000 at                                       
     October 31, 1997.................................   1,071,892     1,235,874   1,660,554 
  Contracts in progress...............................     193,170        72,552      48,938 
  Prepaid expenses and other current assets...........      35,798        19,160      37,351 
  Deferred income taxes (note 9)......................     297,075       387,680     332,435 
  Income tax receivable...............................      63,769            --          -- 
                                                        ----------    ----------  ---------- 
          Total current assets........................   3,444,578     4,531,094   4,886,600 
Property, plant and equipment, net (note 2)...........     601,056       547,061     548,834 
Other assets, net.....................................      12,967        12,967      12,967 
Deferred income taxes (note 9)........................          --            --      44,839 
                                                        ----------    ----------  ---------- 
                                                        $4,058,601    $5,091,122  $5,493,240 
                                                        ==========    ==========  ========== 

LIABILITIES AND STOCKHOLDERS' EQUITY                                                         

Current liabilities:                                                                         
  Accounts payable....................................  $  189,078    $  232,155  $  138,271 
  Accrued expenses (note 6)...........................     302,289       294,743     222,326 
  Income tax payable..................................          --       294,923     565,094 
  Deferred revenue (note 5)...........................     901,923     1,211,552   1,246,094 
                                                        ----------    ----------  ---------- 
          Total current liabilities...................   1,393,290     2,033,373   2,171,785 
                                                        ----------    ----------  ---------- 
Deferred income taxes (note 9)........................      14,304        14,304          -- 
                                                        ----------    ----------  ---------- 
          Total liabilities...........................   1,407,594     2,047,677   2,171,785 
                                                        ----------    ----------  ---------- 
Redeemable common stock, at redemption value (note                                           
  10).................................................     426,635            --          -- 
                                                        ----------    ----------  ---------- 
Stockholders' equity:                                                                        
  Common stock, no par value, 5,000,000 shares                                               
     authorized; issued 2,010,818 shares in 1996 and                                         
     1,921,000 shares in 1997 less redeemable common                                         
     stock shown separately of 89,818 in 1996 and none                                       
     in 1997..........................................     733,500       733,500     733,500 
  Retained earnings...................................   1,490,872     2,309,945   2,587,955 
                                                        ----------    ----------  ---------- 
          Total stockholders' equity..................   2,224,372     3,043,445   3,321,455 
Commitments (notes 8 and 10)..........................                                       
                                                        ----------    ----------  ---------- 
          Total liabilities and stockholders'                                                
            equity....................................  $4,058,601    $5,091,122  $5,493,240 
                                                        ==========    ==========  ========== 

See accompanying notes to financial statements. 

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THE SOFTWARE GROUP, INC.

STATEMENTS OF OPERATIONS

                                                        [Enlarge/Download Table]

                                                                            NINE MONTHS ENDED   
                                YEAR ENDED    YEAR ENDED    YEAR ENDED          JULY 31,        
                                OCTOBER 31,   OCTOBER 31,   OCTOBER 31,  -----------------------
                                   1995          1996          1997         1996         1997   
                                -----------   -----------   -----------  ----------   ----------
                                (UNAUDITED)                                    (UNAUDITED)      
                                                                                                
Revenues:                                                                                       
  Service and support                                                                           
     revenue..................  $ 5,107,837   $ 5,759,062   $ 6,170,148  $4,491,202   $4,588,400
  Software license fees.......    2,505,023     2,302,614     2,134,265   1,344,011    1,919,905
  Hardware sales..............    3,180,484     2,990,073     3,266,398   2,348,165    2,295,852
                                -----------   -----------   -----------  ----------   ----------
          Total revenues......   10,793,344    11,051,749    11,570,811   8,183,378    8,804,157
Cost of revenues:                                                                               
  Cost of services and                                                                          
     support..................    3,800,096     3,174,075     2,864,257   2,186,912    2,003,656
  Cost of hardware............    1,927,801     1,982,118     1,703,980   1,705,034    1,561,365
                                -----------   -----------   -----------  ----------   ----------
          Total cost of                                                                         
            revenues..........    5,727,897     5,156,193     4,568,237   3,891,946    3,565,021
                                -----------   -----------   -----------  ----------   ----------
          Gross margin........    5,065,447     5,895,556     7,002,574   4,291,432    5,239,136
Selling, general and                                                                            
  administrative..............    5,030,701     5,053,721     5,312,680   3,313,411    3,971,982
                                -----------   -----------   -----------  ----------   ----------
          Operating income....       34,746       841,835     1,689,894     978,021    1,267,154
Other income (expense):                                                                         
  Interest income.............       39,024        55,922        87,155      43,088       68,610
  Other.......................      (11,436)      (11,434)           --     (11,434)          --
                                -----------   -----------   -----------  ----------   ----------
          Income before                                                                         
            taxes.............       62,334       886,323     1,777,049   1,009,675    1,335,764
Income tax expense (note 9)...       36,257       338,863       657,508     391,244      494,233
                                -----------   -----------   -----------  ----------   ----------
          Net income..........       26,077       547,460     1,119,541     618,431      841,531
Adjustment to fair market                                                                       
  value of shares subject to                                                                    
  redemption (note 10)........       94,308            --        22,458          --       22,458
                                -----------   -----------   -----------  ----------   ----------
          Net income (loss)                                                                     
            available to                                                                        
            common                                                                              
            shareholders......  $   (68,231)  $   547,460   $ 1,097,083  $  618,431   $  819,073
                                ===========   ===========   ===========  ==========   ==========
Income (loss) per share.......  $      (.03)  $       .26   $       .53  $      .29   $      .39
                                ===========   ===========   ===========  ==========   ==========
Average common and common                                                                       
  share equivalent shares used                                                                  
  in per share computation....    2,143,067     2,145,029     2,078,069   2,145,029    2,085,554
                                ===========   ===========   ===========  ==========   ==========

See accompanying notes to financial statements. 

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THE SOFTWARE GROUP, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED OCTOBER 31, 1995, 1996 AND 1997 

                                                        [Enlarge/Download Table]

                                                    COMMON                                TOTAL    
                                                    SHARES      COMMON    RETAINED    STOCKHOLDERS'
                                                    ISSUED      STOCK     EARNINGS       EQUITY    
                                                   ---------   --------  ----------   -------------
                                                                                                   
Balance at October 31, 1994....................... 2,010,818   $308,500  $1,061,913     $1,370,413 
Compensatory stock option grants (note 1).........        --    425,000          --        425,000 
Change in market value of redeemable stock........        --         --     (94,308)       (94,308)
Net income........................................        --         --      26,077         26,077 
                                                   ---------   --------  ----------     ---------- 
Balance at October 31, 1995....................... 2,010,818    733,500     993,682      1,727,182 
Dividends.........................................        --         --     (50,270)       (50,270)
Net income........................................        --         --     547,460        547,460 
                                                   ---------   --------  ----------     ---------- 
Balance at October 31, 1996....................... 2,010,818    733,500   1,490,872      2,224,372 
Net income........................................        --         --   1,119,541      1,119,541 
Change in market value of redeemable stock........        --         --     (22,458)       (22,458)
Redemption of common stock........................   (89,818)        --          --             -- 
                                                   ---------   --------  ----------     ---------- 
Balance at October 31, 1997....................... 1,921,000   $733,500  $2,587,955     $3,321,455 
                                                   =========   ========  ==========     ========== 

See accompanying notes to financial statements. 

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THE SOFTWARE GROUP, INC.

STATEMENTS OF CASH FLOWS

                                                        [Enlarge/Download Table]

                                                                 YEAR ENDED OCTOBER 31,         
                                                          ------------------------------------- 
                                                             1995          1996         1997    
                                                          -----------   ----------   ---------- 
                                                          (UNAUDITED)                           
                                                                                                
Cash flows from operating activities:                                                           
  Net income............................................. $   26,077    $  547,460   $1,119,541 
  Adjustments to reconcile net income to net cash                                               
     provided by operating activities:                                                          
     Depreciation and amortization.......................    249,109       261,899      246,026 
     Loss on sale of equipment...........................     11,402        11,434           -- 
     Deferred income taxes...............................   (245,590)      127,359      (94,503)
     Compensation expense related to stock options.......    425,000            --           -- 
     Changes in operating assets and liabilities:                                               
       Accounts receivable...............................    142,903      (493,959)    (588,662)
       Contracts in progress.............................         --      (193,170)     144,232 
       Prepaid expenses and other........................     11,505        12,578       62,216 
       Accounts payable..................................   (112,403)       88,975      (50,807)
       Accrued expenses..................................     13,379        92,001      (79,953)
       Income taxes payable..............................    (11,163)      (46,711)     565,094 
       Deferred revenue..................................    (24,692)      273,388      344,171 
                                                          ----------    ----------   ---------- 
          Net cash provided by operating activities......    485,527       681,254    1,667,355 
                                                          ----------    ----------   ---------- 
Cash flows from investing activities:                                                           
  Purchases of property and equipment....................   (294,933)     (229,916)    (193,804)
  Sale of investments....................................    246,835            --           -- 
                                                          ----------    ----------   ---------- 
          Net cash used by investing activities..........    (48,098)     (229,916)    (193,804)
                                                          ----------    ----------   ---------- 
Cash flows from financing activities:                                                           
  Dividends..............................................         --       (50,270)          -- 
  Redemption of ESOP stock (note 10).....................         --            --     (449,093)
                                                          ----------    ----------   ---------- 
          Net cash used in financing activities..........         --       (50,270)    (449,093)
                                                          ----------    ----------   ---------- 
Net increase in cash and cash equivalents................    437,429       401,068    1,024,458 
Cash and cash equivalents at beginning of period.........    944,377     1,381,806    1,782,874 
                                                          ----------    ----------   ---------- 
Cash and cash equivalents at end of period............... $1,381,806    $1,782,874   $2,807,332 
                                                          ==========    ==========   ========== 
Supplemental cash flow information -- income taxes                                              
  paid................................................... $  261,834    $  328,774   $  186,918 
                                                          ==========    ==========   ========== 

See accompanying notes to financial statements. 

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THE SOFTWARE GROUP, INC.

STATEMENTS OF CASH FLOWS

                                                        [Enlarge/Download Table]

                                                                NINE MONTHS ENDED    
                                                                    JULY 31,         
                                                             ----------------------- 
                                                                1996         1997    
                                                             ----------   ---------- 
                                                                   (UNAUDITED)       
                                                                                     
Cash flows from operating activities:                                                
  Net income................................................ $  618,431   $  841,531 
  Adjustments to reconcile net income to net cash provided                           
     by operating activities:                                                        
     Depreciation and amortization..........................    193,035      176,134 
     Loss on sale of equipment..............................     11,434           -- 
     Deferred income taxes..................................    139,175      (90,605)
     Changes in operating assets and liabilities:                                    
       Accounts receivable..................................    103,989     (163,982)
       Contracts in progress................................    (16,585)     120,618 
       Prepaid expenses and other...........................     71,943       80,407 
       Accounts payable.....................................    (72,067)      43,077 
       Accrued expenses.....................................    (37,513)      (7,546)
       Income taxes payable.................................    (12,114)     294,923 
       Deferred revenue.....................................     95,473      309,629 
                                                             ----------   ---------- 
          Net cash provided by operating activities.........  1,095,201    1,604,186 
                                                             ----------   ---------- 
Cash flows from investing activities -- purchases of                                 
  property and equipment....................................   (120,837)    (122,139)
                                                             ----------   ---------- 
          Net cash used by investing activities.............   (120,837)    (122,139)
                                                             ----------   ---------- 
Cash flows from financing activities -- redemption of ESOP                           
  stock (note 10)...........................................         --     (449,093)
                                                             ----------   ---------- 
          Net cash used in financing activities.............         --     (449,093)
                                                             ----------   ---------- 
Net increase in cash and cash equivalents...................    974,364    1,032,954 
Cash and cash equivalents at beginning of period............  1,381,806    1,782,874 
                                                             ----------   ---------- 
Cash and cash equivalents at end of period..................  2,356,170    2,815,828 
                                                             ==========   ========== 
Supplemental cash flow information -- income taxes paid..... $  266,104   $  117,847 
                                                             ==========   ========== 

See accompanying notes to financial statements. 

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS 

(INFORMATION AS OF JULY 31, 1997 AND FOR THE NINE MONTHS ENDED
JULY 31, 1996 AND 1997 AND THE YEAR ENDED OCTOBER 31, 1995 IS UNAUDITED)

(1) DESCRIPTION OF BUSINESS                                                     

(a) General Information                                                     

     The Company's business consists predominantly of selling computer hardware,
software and support services to governmental entities within the United States.
The Company has a range of products to serve the automation needs of local      
government clients, including appraisal districts, tax offices, court rooms,    
jails, sheriff departments and financial administrative offices. The Company was
formed in 1981 as a C Corporation, and is incorporated in the state of Texas.   

(b) Cash and Cash Equivalents                                               

Cash equivalents consist of short-term highly liquid investments with 
original maturities of three months or less. Cash equivalents at October 31,    
1996 and 1997 consisted of money market accounts in the amount of $1,573,800 and
$2,659,314, respectively.                                                       

(c) Property and Equipment                                                  

 Property and equipment are stated at cost. Depreciation on equipment is
calculated on a straight-line basis for furniture and fixtures and using        
accelerated depreciation methods for other equipment over the estimated useful  
lives of the assets.                                                            

(d) Revenue Recognition                                                     

The Company sells off-the-shelf software packages, and in a variety of
instances, computer equipment and related peripherals, installation, and        
training. The Company recognizes revenue, including those arrangements which    
entail a customer-specific installation solution, when all of the elements have 
been delivered, training completed, all significant contractual obligations     
satisfied and collection of the related receivable for the entire arrangement is
probable. The Company also provides maintenance, which is deferred based on     
vendor specific evidence of fair value, and recognized ratably over the service 
period. Incremental training is billable on a time and material basis and is    
recognized as revenue when the related services are performed.                  

To the extent computer hardware and the related peripherals are drop  
shipped to a customer before the end of an accounting period, the Company       
records contracts in progress for the corresponding cost of such equipment.     

(e) Concentration of Credit Risk                                            

Financial instruments which potentially expose the Company to         
concentrations of credit risk include accounts receivable. The Company maintains
reserves for potential credit losses and such losses, in the aggregate, have not
exceeded management expectations.                                               

(f) Software Development Costs                                              

In accordance with the provisions of Statement of Financial Accounting
Standards No. 86, "Accounting for the Costs of Computer Software to Be Sold,    
Leased, or Otherwise Marketed," software development costs are expensed prior to
the establishment of technological feasibility of the software development      
project. Costs incurred after that point are capitalized until the product is   
available for general release. No such costs have been capitalized at October   
31, 1996 and 1997.                                                              

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(g) Use of Estimates                                                        

The preparation of financial statements in conformity with generally  
accepted accounting principles requires management to make estimates and        
assumptions that affect the reported amounts of assets and liabilities and      
disclosure of contingent assets and liabilities at the date of the financial    
statements and the reported amounts of revenues and expenses during the         
reporting period. Actual results could differ from those estimates.             

(h) Income Taxes                                                            

    The Company's income taxes are accounted for under the asset and liability
method for financial reporting purposes and the cash method for income tax      
purposes. Deferred tax assets and liabilities are recognized for the future tax 
consequences attributable to differences between the financial statement        
carrying amounts of existing assets and liabilities and their respective tax    
bases and operating losses and tax credit carryforwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable   
income in the years in which these temporary differences are expected to be     
recovered or settled. The effect on deferred tax assets and liabilities of a    
change in tax rates is recognized in income in the period that includes the     
enactment date.                                                                 

(i) Impairment of Long-Lived Assets and Assets to Be Disposed Of            

 The Company adopted the provisions of Statement of Financial Accounting
Standards No. 121 (SFAS No. 121), Accounting for the Impairment of Long-Lived   
Assets and for Long-Lived Assets to Be Disposed Of on November 1, 1995. This    
Statement requires that long-lived assets and certain identifiable intangibles  
be reviewed for impairment whenever events or changes in circumstances indicate 
that the carrying amount of an asset may not be recoverable. Recoverability of  
assets to be held and used is measured by a comparison of the carrying amount of
an asset to future net cash flows expected to be generated by the asset. If such
assets are considered to be impaired, the impairment to be recognized is        
measured by the amount by which the carrying amount of the assets exceed the    
fair value of the assets. Assets to be disposed of are reported at the lower of 
the carrying amount or fair value less costs to sell. Adoption of this statement
did not have a material impact on the Company's financial position, results of  
operations or liquidity.                                                        

(j) Net Income Per Common Share                                             

   Per share information was calculated based on the weighted average number
of shares of common stock and common stock equivalents, outstanding during the  
respective periods. The common stock equivalents relate to stock options and    
were computed using the treasury stock method.                                  

(k) Unaudited Interim Financial Information                                 

Interim information for the nine months ended July 31, 1996 and 1997, 
including such information in the notes to the financial statements, is         
unaudited. This information has been prepared on the same basis as the annual   
financial statements and, in the opinion of the Company's management, reflects  
all adjustments, consisting of normal recurring adjustments, considered         
necessary for a fair presentation of the results of such period. Financial      
results for the interim period are not necessarily indicative of the results for
a full year. Financial information as of and for the year ended October 31, 1995
is also unaudited.                                                              

(l) Stock Option Plan                                                       

The Company accounts for its stock option plan in accordance with the 
provisions of Accounting Principles Board ("APB") Opinion No. 25, "Accounting   
for Stock Issued to Employees," and related interpretations. As such,           
compensation expense would be recorded on the date of grant only if the current 

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

market price of the underlying stock exceeded the exercise price. SFAS No. 123, 
"Accounting for Stock-Based Compensation" allows entities to continue to apply  
the provisions of APB Opinion No. 25 and provide pro forma net income and pro   
forma earnings per share disclosures for employee stock option grants made      
subsequent to October 31, 1995 and future years as if the fair-value-based      
method defined in SFAS No. 123 had been applied. The Company has elected to     
continue to apply the provisions of APB Opinion No. 25 and provide the pro forma
disclosure provisions of SFAS No. 123. There were no stock options granted      
subsequent to October 31, 1995. Consequently, no pro forma disclosure is        
required.                                                                       

(2) PROPERTY AND EQUIPMENT                                                      

Property and equipment consisted of the following:                    

                                                        [Enlarge/Download Table]

                                                    USEFUL    OCTOBER 31,  OCTOBER 31,
                                                     LIFE        1996         1997    
                                                   ---------  -----------  -----------
                                                                                      
Furniture and fixtures............................ 3-7 years  $  979,707   $1,080,965 
Computer hardware and software.................... 3-7 years     365,912      425,462 
Transportation equipment.......................... 3-5 years     241,497      278,132 
                                                              ----------   ---------- 
                                                               1,587,116    1,784,559 
Less accumulated depreciation.....................              (986,060)  (1,235,725)
                                                              ----------   ---------- 
                                                              $  601,056   $  548,834 
                                                              ==========   ========== 

(3) LINES OF CREDIT                                                             

     Under a loan agreement with First Bank McKinney dated January 31, 1996, the
Company has a revolving line of credit secured by accounts receivable and       
personal guarantees with a maximum limit of $400,000. Interest is due at        
maturity, and the rate is 10%. The line of credit matured on January 31, 1997   
and was not renewed. There was no outstanding balance on this line of credit as 
of October 31, 1996.                                                            

(4) FINANCIAL INSTRUMENTS                                                       

The carrying value of financial instruments such as cash equivalents, 
accounts receivable, accounts payable and accrued expenses approximate their    
fair value because of their short maturity.                                     

(5) DEFERRED REVENUE                                                            

Deferred revenues represents billings on quarterly and annual rental  
agreements and maintenance contracts with certain counties. Only one month's    
revenue had been earned on the fourth quarter billings as of October 31, 1996   
and 1997. Similar accounting is used for billings other than quarterly.         

(6) ACCRUED EXPENSES                                                            

Accrued expenses consisted of the following:                          

                                                                [Download Table]

                                                     OCTOBER 31,     
                                                 --------------------
                                                   1996        1997  
                                                 --------    --------
                                                                     
Accrued vacation...............................  $119,937    $115,535
Other..........................................   182,352     106,791
                                                 --------    --------
                                                 $302,289    $222,326
                                                 ========    ========

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(7) STOCK OPTION PLAN                                                           

   The Company has a stock option plan (the "Option Plan") pursuant to which
the Company's Board of Directors may grant stock options to officers, key       
employees and consultants. The Plan authorizes grants of options to purchase up 
to 300,000 shares of authorized but unissued common stock.                      

     The Company accounts for stock-based compensation using the intrinsic value
method prescribed by APB No. 25 "Accounting for Stock Issued to Employees," (APB
No. 25) and related interpretations. Accordingly, the Company is to record      
expense in an amount equal to the excess of the market price of common stock on 
the grant date over the option exercise price. Such expense is recognized at the
grant date for options fully vested.                                            

In 1992, the Company granted 50,000 fully vested stock options with an
exercise price of $.50 per share, which had not been exercised at October 31,   
1997.                                                                           

In addition, in 1995, the Company granted 100,000 fully vested stock  
options with an exercise price of $.50 per share, which had not been exercised  
at October 31, 1997. The Company recorded $425,000 in compensation expense      
during the year ended October 31, 1995 in connection with the 1995 grant. The   
150,000 stock options were fully vested and outstanding at October 31, 1997.    
There were no grants in 1996 or 1997.                                           

(8) LEASES                                                                      

  The Company has entered into an operating lease for its office building.
Rent expense incurred in connection with operating leases was $129,673, $155,608
and $155,608 for the years ended October 31, 1995, 1996 and 1997, respectively. 

    Future minimum payments, by year and in the aggregate, under the operating
lease consisted of the following at October 31, 1997:                           

                                                                [Download Table]

YEAR ENDING                                                                      
OCTOBER 31,                                                                      
-----------                                                                      
                                                                                 
  1998.................................................................. $155,608
  1999..................................................................  155,608
  Thereafter............................................................       --
                                                                         --------
                                                                         $311,216
                                                                         ========

(9) INCOME TAXES                                                                

   The provision for income taxes for the years ended October 31, 1995, 1996
and 1997 consisted of the following:                                            

                                                        [Enlarge/Download Table]

                                                        1995        1996      1997   
                                                     -----------  --------  -------- 
                                                     (UNAUDITED)                     
                                                                                     
Current tax expense:                                                                 
  Federal...........................................  $ 250,671   $186,910  $691,238 
  State and local...................................     31,176     24,594    60,973 
                                                      ---------   --------  -------- 
                                                        281,847    211,504   752,211 
Deferred tax (benefit) expense:                                                      
  Federal...........................................   (216,284)   125,364   (86,841)
  State and local...................................    (29,306)     1,995    (7,662)
                                                      ---------   --------  -------- 
                                                       (245,590)   127,359   (94,503)
                                                      ---------   --------  -------- 
                                                      $  36,257   $338,863  $657,508 
                                                      =========   ========  ======== 

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

 Income tax expense for the years ended October 31, 1995, 1996, and 1997
differs from the amount computed by applying the U.S. federal income tax rate of
34 percent to pretax income as a result of the following:                       

                                                                [Download Table]

                                                        1995        1996      1997  
                                                     -----------  --------  --------
                                                     (UNAUDITED)                    
                                                                                    
Computed "expected" tax expense.....................   $21,193    $301,350  $604,197
State and local taxes, net of federal income tax                                    
  benefit...........................................     1,870      26,589    53,311
Other differences...................................    13,194      10,924         -
                                                       -------    --------  --------
                                                       $36,257    $338,863  $657,508
                                                       =======    ========  ========

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and at October 31, 1996 and 1997 are        
presented below:                                                                

                                                                [Download Table]

                                                               1996       1997   
                                                             --------   -------- 
                                                                                 
Deferred tax assets:                                                             
  Deferred revenue.......................................... $     --   $ 59,221 
  Deferred rentals..........................................   14,685     18,269 
  Accounts receivable reserve...............................   10,200     32,400 
  Accrued vacation..........................................   53,501     42,748 
  Tax benefit attributed to stock options...................  256,225    256,225 
                                                             --------   -------- 
          Total deferred tax assets.........................  334,611    408,663 
                                                             --------   -------- 
Deferred tax liabilities:                                                        
  Contracts in progress and other...........................  (38,090)   (18,107)
  Depreciation..............................................  (13,750)   (13,482)
                                                             --------   -------- 
          Total deferred tax liabilities....................  (51,840)   (31,589)
                                                             --------   -------- 
          Net deferred tax assets........................... $282,771   $377,274 
                                                             ========   ======== 

     In assessing the realizability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax 
assets will not be realized. The ultimate realization of deferred tax assets is 
dependent upon the generation of future taxable income during the periods in    
which these temporary differences become deductible. Management considers       
scheduled reversal of deferred tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment. Management believes it is
more likely than not that the Company will fully realize the benefits of these  
deferred tax assets.                                                            

(10) RETIREMENT PLANS                                                           

In November of 1983, the Company established The Software Group, Inc. 
Employee Stock Ownership Plan (ESOP). The ESOP owned 89,818 shares of the       
Company's common stock at October 31, 1995 and 1996. The ESOP plan covers all   
eligible employees meeting age and length of service requirements. Under the    
terms of the ESOP, contributions are at the discretion of the Board of Directors
up to the maximum allowable for tax purposes. The Company contributed $5,000 to 
the ESOP for the year ended October 31, 1995. No contributions were made to the 
ESOP for the years ended October 31, 1996 and 1997.                             

Under the provisions of the Company's ESOP, the Company is required to
repurchase upon the death, disability, retirement, or termination of a          
participant, all shares of common stock issued to such participant under terms  
of the ESOP, if so requested by the participant or his/her estate. Other        
provisions of the ESOP require the Company to repurchase a portion of the       
participant's total shares under specified terms and/or                         

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THE SOFTWARE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

conditions. Repurchases under the ESOP are to be made at the value as determined
by the most recent valuation date (as defined by the ESOP) over a period not to 
exceed six years.                                                               

   Accounting standards under rules and regulations issued by the Securities
and Exchange Commission require that common stock subject to "put rights" (which
are exercisable under certain circumstances with the ESOP) be presented         
separately from common stock which is not subject to "put rights" in order to   
distinguish it from permanent capital in the legal sense. Further, such         
accounting standards require the Company to present such ESOP shares on the     
balance sheet at the amount which would be paid if redeemed. Accordingly, on the
balance sheet at October 31, 1996, the 89,818 shares in 1996 of common stock    
owned by the ESOP are classified as redeemable common stock owned by the ESOP   
are classified as redeemable common stock at redemption values of $426,635. A   
change in the fair market value of shares subject to redemption is also         
reflected as an adjustment to retained earnings. At October 31, 1996 and 1995,  
the ESOP per share fair market value was $4.75.                                 

   The ESOP was terminated effective January 31, 1997, and the shares of the
stock were redeemed at a value of $5.00 per share, for a total redemption value 
of $449,093. The Company subsequently retired the redeemed shares which resulted
in a corresponding decrease of 89,818 shares issued.                            

    In 1990, the Company added a 401(k) retirement plan. The 401(k) provisions
cover all eligible employees of the Company who meet age and length of service  
requirements. Employee contributions are by salary reduction and are at the     
employee's discretion within the limits imposed by the 401(k) document          
provisions and the Internal Revenue Code. Employer contributions are            
discretionary and can be up to 2% of the total employee compensation. In fiscal 
year 1996, the employer matched employee contributions fifty cents on the       
dollar. Total employer contributions to the 401(k) plan were $62,933 and $54,428
for the years ended October 31, 1996 and 1997, respectively.                    

(11) DEFINITIVE MERGER AGREEMENT                                                

On October 8, 1997, the Company reached a definitive agreement to be  
acquired by the Tyler Corporation. Tyler Corporation will acquire the stock of  
the Company in exchange for cash and shares of Tyler Corporation. The           
acquisition is contingent upon regulatory and shareholder approvals.            

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                                                                      APPENDIX A

SECOND AMENDED AND RESTATED 
AGREEMENT AND PLAN OF MERGER

AMONG 

TYLER CORPORATION,

T1 ACQUISITION CORPORATION, 

BUSINESS RESOURCES CORPORATION

AND 

WILLIAM D. OATES

DATED AS OF 

DECEMBER 29, 1997 

AND EFFECTIVE AS OF 

OCTOBER 8, 1997 

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TABLE OF CONTENTS 

ARTICLE 1 

THE MERGER

                                                                [Download Table]
                                                                         
1.1    The Merger..................................................   A-6
1.2    Closing.....................................................   A-6
1.3    Effective Time..............................................   A-6
1.4    Effects of the Merger.......................................   A-6
1.5    Articles of Incorporation; Bylaws...........................   A-7
1.6    Directors and Officers......................................   A-7
1.7    Conversion of Securities; Exchange; Fractional Shares.......   A-7
1.8    Additional Merger Consideration.............................   A-9
1.9    Adjustments to Prevent Dilution.............................   A-9
1.10   Taking of Necessary Action; Further Action..................   A-9

                                ARTICLE 2                                
                     REPRESENTATIONS AND WARRANTIES                      
                   OF THE COMPANY AND THE SHAREHOLDER                    

2.1    Organization and Good Standing of Company...................   A-9
2.2    Organization and Good Standing of Company Subsidiaries......   A-9
2.3    Other Investments...........................................   A-9
2.4    Foreign Qualification.......................................   A-9
2.5    Power and Authority to Conduct Business.....................  A-10
2.6    Authority to Consummate Merger..............................  A-10
2.7    Binding Effect..............................................  A-10
2.8    Compliance with Other Instruments...........................  A-10
2.9    Capitalization of Company...................................  A-11
2.10   Capitalization of the Company Subsidiaries..................  A-11
2.11   Company Investments.........................................  A-11
2.12   Company Financial Statements................................  A-12
2.13   Absence of Certain Changes..................................  A-12
2.14   No Material Undisclosed Liabilities.........................  A-13
2.15   Tax Liabilities.............................................  A-14
2.16   Title to Properties.........................................  A-14
2.17   Condition of Tangible Assets................................  A-16
2.18   Accounts Receivable.........................................  A-16
2.19   Inventory Good and Salable..................................  A-16
2.20   Patents, Trademarks, and Copyrights.........................  A-16
2.21   Contracts...................................................  A-17
2.22   Litigation and Claims.......................................  A-18
2.23   Judgments, Decrees, and Orders in Restraint of Business.....  A-18
2.24   No Violation of Any Instrument..............................  A-18
2.25   Compliance With Laws........................................  A-19
2.26   Compensation and Benefit Plans..............................  A-19
2.27   Labor Relations.............................................  A-20
2.28   Adequate Insurance..........................................  A-20
2.29   Contracts with Affiliates and Others........................  A-20
2.30   Revenue Recognition.........................................  A-21
2.31   Certain Fees................................................  A-21
2.32   Environmental Matters.......................................  A-21
2.33   Section 368 Representations.................................  A-21

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                                                                [Download Table]
                                                                         
2.34   Accuracy of Information Furnished...........................  A-22
2.35   Representations Limited.....................................  A-22

                                ARTICLE 3                                
                 REPRESENTATIONS AND WARRANTIES OF TYLER                 

3.1    Organization and Good Standing of Tyler.....................  A-23
3.2    Foreign Qualification.......................................  A-23
3.3    Power and Authority to Conduct Business.....................  A-23
3.4    Authority to Consummate Merger..............................  A-23
3.5    Binding Effect..............................................  A-23
3.6    Compliance with Other Instruments...........................  A-23
3.7    Capitalization of Tyler.....................................  A-24
3.8    Commission Filings; Financial Statements....................  A-24
3.9    Absence of Certain Changes..................................  A-25
3.10   No Material Undisclosed Liabilities.........................  A-25
3.11   Litigation and Government Claims............................  A-25
3.12   No Violation of Any Instrument..............................  A-25
3.13   Certain Fees................................................  A-26
3.14   No Interim Operations of Sub................................  A-26
3.15   Accuracy of Information Furnished...........................  A-26
3.16   Company Contract Bids.......................................  A-26

                                ARTICLE 4                                
        JOINT COVENANTS OF THE COMPANY, THE SHAREHOLDER AND TYLER        

4.1    Access; Confidentiality.....................................  A-26
4.2    Notice of any Material Change...............................  A-27
4.3    Monthly Financial Statements................................  A-27
4.4    Antitrust Notification......................................  A-27
4.5    Tax Matters.................................................  A-27
4.6    Cooperation Pending Closing.................................  A-30
4.7    Non-competition Allocation..................................  A-30

                                ARTICLE 5                                
              COVENANTS OF THE COMPANY AND THE SHAREHOLDER               

5.1    Conduct of Business Prior to Closing Date...................  A-30
5.2    Employment Agreement........................................  A-31
5.3    Noncompetition Agreements...................................  A-31
5.4    Agreement Not to Negotiate..................................  A-31
5.5    Permitted Distributions of Cash and Condo...................  A-31
5.6    Waiver of Adverse Claims....................................  A-31
5.7    Accuracy of Information Furnished...........................  A-31
5.8    Pre-Closing Bonuses.........................................  A-32
5.9    New Indebtedness............................................  A-32
5.10   Stock Grants................................................  A-32
5.11   Transfer of Headquarters Facilities.........................  A-32

                                ARTICLE 6                                
                           COVENANTS OF TYLER                            

6.1    Conduct Prior to Closing Date...............................  A-32
6.2    Proxy Statement.............................................  A-32
6.3    Meetings of Stockholders....................................  A-32

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6.4    Stock Exchange Listing......................................  A-33       
6.5    Guaranties of Company Obligations...........................  A-33       
6.6    Other Tyler Obligations.....................................  A-33       
6.7    Company Indemnification Obligations.........................  A-33       
6.8    Agreements Regarding Stock Options..........................  A-34       
6.9    Release of Shareholder Guaranties...........................  A-34       
6.10   Tyler Loan..................................................  A-34       

ARTICLE 7       
JOINT CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS       

7.1    HSR Act.....................................................  A-35       
7.2    Absence of Litigation.......................................  A-35       
7.3    The Software Group..........................................  A-35       

ARTICLE 8       
CONDITIONS PRECEDENT TO OBLIGATIONS       
OF THE COMPANY AND THE SHAREHOLDER        

8.1    Compliance..................................................  A-35       
8.2    Representations and Warranties..............................  A-35       
8.3    Opinion.....................................................  A-36       
8.4    No Material Adverse Change..................................  A-36       
8.5    Tyler Stockholder Approval..................................  A-36       
8.6    Financing...................................................  A-36       
8.7    Certificates................................................  A-36       

ARTICLE 9       
CONDITIONS PRECEDENT TO OBLIGATIONS OF TYLER        

9.1    Compliance..................................................  A-36       
9.2    Representations and Warranties..............................  A-36       
9.3    Securities Law Compliance...................................  A-36       
9.4    Opinions....................................................  A-36       
9.5    No Material Adverse Change..................................  A-37       
9.6    Consents to Transaction.....................................  A-37       
9.7    Stockholder Approval........................................  A-37       
9.8    Financing...................................................  A-37       
9.9    Noncompetition Agreements...................................  A-37       
9.10   Certificates................................................  A-37       
9.11   Company Shareholder Approval................................  A-37       
9.12   No Dissenting Shareholders..................................  A-37       

ARTICLE 10        
SECURITIES LAW REGISTRATION AND COMPLIANCE        

10.1   Securities Law Compliance; Restrictions on Shares...........  A-37       
10.2   Demand Registration.........................................  A-38       
10.3   Piggyback Registration......................................  A-39       
10.4   Registration Procedures.....................................  A-39       
10.5   Expenses....................................................  A-41       
10.6   Indemnification.............................................  A-42       
10.7   No Transferability of Registration Rights...................  A-43       

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ARTICLE 11        
INDEMNIFICATION AND REMEDIES        

11.1   Indemnification by the Shareholder Based on Agreement.......  A-43       
11.2   Indemnification by Tyler Based on Agreement.................  A-44       
11.3   Customer Claims.............................................  A-44       
11.4   Claims Limitations..........................................  A-45       
11.5   Maximum Liability...........................................  A-45       
11.6   Equitable Remedies..........................................  A-46       
11.7   Remedies of the Surviving Corporation.......................  A-46       
11.8   Right of Offset.............................................  A-46       
11.9   Costs of Defense............................................  A-46       

ARTICLE 12        
MISCELLANEOUS       

12.1   Breach Discovered Prior to Closing..........................  A-47       
12.2   Termination.................................................  A-47       
12.3   Expenses....................................................  A-48       
12.4   Disclosure Schedules........................................  A-48       
12.5   Entire Agreement............................................  A-48       
12.6   Survival....................................................  A-48       
12.7   Counterparts................................................  A-48       
12.8   Notices.....................................................  A-48       
12.9   Successors and Assigns......................................  A-49       
12.10  Governing Law...............................................  A-49       
12.11  Waiver and Other Action.....................................  A-49       
12.12  Severability................................................  A-49       
12.13  Knowledge...................................................  A-50       

EXHIBITS        

Exhibit A     Surviving Corporation Directors and Officers                      

Exhibit B     Employment and Noncompetition Agreement                           

Exhibit C     Form of Stock Transfer Agreement [Class B]                        

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SECOND AMENDED AND RESTATED 
AGREEMENT AND PLAN OF MERGER

 THIS SECOND AMENDED AND RESTATED AGREEMENT, dated as of the 29th day of
December, 1997 and effective as of the 8th day of October, 1997, is entered into
by and among Tyler Corporation, a Delaware corporation ("Tyler"), T1 Acquisition
Corporation, a Texas corporation and wholly-owned subsidiary of Tyler ("Sub"),  
Business Resources Corporation, a Texas corporation (the "Company"), and William
D. Oates, the principal shareholder of the Company (the "Shareholder").         

WITNESSETH: 

     WHEREAS, subject to and in accordance with the terms and conditions of this
Agreement, the respective Boards of Directors of Tyler, Sub and the Company, and
Tyler as sole shareholder of Sub, have approved the merger of the Company with  
and into Sub (the "Merger"), including the acquisition of the Headquarters      
Facilities (defined herein), as a result of which the holders of all the issued 
and outstanding shares of common stock, par value $0.01 per share, of the       
Company (the "Company Common Stock") not owned directly or indirectly by the    
Company will receive in the aggregate $15,250,000 in cash and 10,000,000 shares 
of common stock, par value $0.01 per share, of Tyler ("Tyler Common Stock"), in 
the manner and subject to the adjustments provided herein;                      

  WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the   
Internal Revenue Code of 1986, as amended (the "Code"); and                     

  WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the      
consummation of the Merger;                                                     

NOW, THEREFORE, in consideration of the premises and of the mutual    
representations, warranties and covenants herein contained, the parties hereto  
hereby agree as follows:                                                        

ARTICLE 1 

THE MERGER

     1.1  The Merger. Subject to and in accordance with the terms and conditions
of this Agreement and in accordance with the Texas Business Corporation Act (the
"TBCA"), at the Effective Time (as defined in Section 1.3) the Company shall be 
merged with and into Sub. As a result of the Merger, the separate corporate     
existence of the Company shall cease and Sub shall continue as the surviving    
corporation (sometimes referred to herein as the "Surviving Corporation") and   
shall succeed to and assume all of the rights and obligations of the Company in 
accordance with the TBCA.                                                       

1.2  Closing. The closing of the Merger and the transfer of the       
Headquarters Facilities (the "Closing") shall take place at the offices of      
Gardere & Wynne, L.L.P., 1601 Elm Street, Suite 3000, Dallas, Texas 75201 as    
soon as practicable after the satisfaction or waiver of the conditions set forth
in Article V or at such other time and place and on such other date as Tyler and
the Company shall agree; provided, that the closing conditions set forth in     
Article V shall have been satisfied or waived at or prior to such time. The date
on which the Closing occurs is herein referred to as the "Closing Date."        

1.3  Effective Time. On the Closing Date, or as soon as practicable   
thereafter, the Company and Sub will cause Articles of Merger (the "Articles of 
Merger") to be filed with the Secretary of State of the State of Texas as       
provided in Article 5.04 of the TBCA. The Merger will become effective at the   
time that the Articles of Merger have been filed with the Secretary of State of 
the State of Texas or at such other time specified in the Articles of Merger as 
the effective time (the "Effective Time").                                      

    1.4  Effects of the Merger. The Merger shall have the effects set forth in
the applicable provisions of the TBCA.                                          

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    1.5  Articles of Incorporation; Bylaws. The Articles of Incorporation (the
"Articles") and Bylaws (the "Bylaws") of Sub, as in effect immediately prior to 
the Effective Time, shall be identical to the Company's Articles of             
Incorporation and Bylaws and shall be the articles of incorporation and bylaws  
of the Surviving Corporation and thereafter shall continue to be its articles of
incorporation and bylaws until amended as provided therein and under the TBCA.  

    1.6  Directors and Officers. The persons specified as directors on Exhibit
A hereto shall be the initial directors of the Surviving Corporation, each to   
hold office in accordance with the Articles and Bylaws, and the persons         
specified as officers on Exhibit A hereto shall be the initial officers of the  
Surviving Corporation, in each case until their respective successors are duly  
elected or appointed and qualified in accordance with the Articles and Bylaws.  

    1.7  Conversion of Securities; Exchange; Fractional Shares. Subject to the
terms and conditions of this Agreement, at the Effective Time, by virtue of the 
Merger and the other transactions contemplated hereby, including the transfer of
the Headquarters Facilities as provided in Section 5.11, and without any action 
on the part of the Company, Sub or Tyler:                                       

      (a) The holders of the Company Common Stock issued and outstanding
immediately prior to the Effective Time, other than any shares of the 
  Company Common Stock to be canceled pursuant to Section 1.7(b), shall be
     entitled to receive, subject to the provisions of this Section 1.7, without
interest, cash or shares of Tyler Common Stock as follows:            

            (i) The holder of Class A Common Stock, par value $0.01 per share,
        of the Company ("Class A Common Stock") shall be entitled to receive (A)
  $15,250,000 in cash, (B) 100 shares of Tyler Common Stock for each
      outstanding share of Class A Common Stock outstanding at the Effective
   Time, and (C) the Additional Merger Consideration, if any, that may
    become payable after the Effective Time pursuant to Section 1.8; and

       (ii) The holders of Class B Common Stock, par value $0.01 per
   share, of the Company ("Class B Common Stock") shall be entitled to
      receive 100 shares of Tyler Common Stock for each outstanding share of
Class B Common Stock outstanding at the Effective Time.         

         The cash and shares of Tyler Common Stock to which holders of Company
Common Stock shall be so entitled to receive at the Effective Time are
collectively referred to herein as the "Consideration". No fractional 
    shares of Tyler Common Stock shall be issued, and, in lieu thereof, a cash
     payment shall be made in accordance with the procedure set forth in Section
1.7(g) hereof.                                                        

      (b) Each share of Company Common Stock held in the treasury of the
  Company and each share of Company Common Stock held by Sub, Tyler or any
direct or indirect wholly-owned subsidiary of Tyler, or the Company   
    immediately prior to the Effective Time shall be canceled and extinguished
   at the Effective Time without any conversion thereof and no payment shall
be made with respect thereto.                                         

     (c) Each share of common stock, par value $1.00 per share, of Sub
     issued and outstanding immediately prior to the Effective Time shall at the
Effective Time be converted into one validly issued, fully paid and   
nonassessable share of common stock of the Surviving Corporation.     

        (d) At the Effective Time, each holder of an outstanding certificate
that prior thereto represented shares of Company Common Stock shall be
  entitled to receive, upon surrender to the Surviving Corporation of such
  certificate or certificates for cancellation and subject to any required
     withholding of taxes, a certificate or certificates representing the number
     of whole shares of Tyler Common Stock (of such denominations and registered
    in such names as such holder may request) into which the shares of Company
Common Stock so surrendered shall have been converted. Each holder of 
shares of Company Common Stock who would otherwise be entitled to a   
fraction of a share of Tyler Common Stock shall, upon surrender to the
  Surviving Corporation of the certificates representing shares of Company
   Common Stock held by such holder, be paid an amount in cash in accordance
with the provisions of Section 1.7(g). Until so surrendered, each     
     outstanding certificate that prior to the Effective Time represented shares
   of Company Common Stock shall be deemed from and after the Effective Time
to evidence the                                                       

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right to receive that amount of cash, if any, and that number of full 
     shares of Tyler Common Stock into which such shares of Company Common Stock
  shall have been converted pursuant to this Section 1.7, any dividends or
distributions contemplated or permitted by this Agreement and declared
    concurrently with or prior to Closing, but which are unpaid as of Closing,
     and any cash in lieu of fractional shares of Tyler Common Stock, subject to
     any of required withholding of taxes. No interest shall be paid on the cash
     payable upon surrender of the certificate or certificates evidencing shares
     of Company Common Stock. Unless and until any such outstanding certificates
representing shares of Company Common Stock shall be surrendered, no  
 dividends or other distributions declared and payable to the holders of
Tyler Common Stock on or after the Effective Time shall be paid to the
    holders of such outstanding certificates which prior to the Effective Time
   represented shares of Company Common Stock; provided, however, that, upon
 surrender and exchange of such outstanding certificates, there shall be
paid to the record holders of the certificates issued and exchanged   
therefor the amount, without interest thereon, of dividends and other 
  distributions, if any, that theretofore were declared and became payable
     since the Effective Time with respect to the number of full shares of Tyler
Common Stock issued to such holders.                                  

         (e) The cash, if any, and shares of Tyler Common Stock into which the
   shares of Company Common Stock shall have been converted pursuant to this
   Section 1.7 shall be issued in full satisfaction of all rights pertaining
    to such converted shares of Company Common Stock except for the payment of
    any dividends or distributions contemplated or permitted by this Agreement
     and declared concurrently with or prior to Closing, but which are unpaid as
of Closing.                                                           

    (f) If any certificate for shares of Tyler Common Stock is to be
  issued in a name other than that in which the certificate surrendered in
  exchange therefor is registered, it shall be a condition of the issuance
    thereof that the certificate so surrendered shall be properly endorsed and
   otherwise in proper form for transfer and that the person requesting such
     exchange shall have paid to Tyler or the Surviving Corporation any transfer
or other taxes required by reason of the issuance of a certificate for
    shares of Tyler Common Stock in any name other than that of the registered
   holder of the certificate surrendered, or established to the satisfaction
of Tyler or its transfer agent that such tax has been paid or is not  
payable.                                                              

         (g) No fraction of a share of Tyler Common Stock shall be issued, but
 in lieu thereof each holder of shares of Company Common Stock who would
     otherwise be entitled to a fraction of a share of Tyler Common Stock shall,
upon surrender to the Surviving Corporation of the certificate or     
   certificates representing the shares of Company Common Stock held by such
    holder, be paid an amount in cash equal to the value of such fraction of a
  share of Tyler Common Stock based upon the closing price of Tyler Common
   Stock on the New York Stock Exchange on the last trading day prior to the
 Effective Time. No interest shall be paid on such amount. All shares of
Company Common Stock held by a record holder shall be aggregated for  
purposes of computing the number of shares of Tyler Common Stock to be
issued pursuant to this Section 1.7.                                  

       (h) At the Closing, Tyler shall provide each holder of certificates
which prior to the Effective Time represented shares of Company Common
    Stock a letter of transmittal and other documentation enabling such holder
   to effect the exchange of stock certificates as contemplated by Article 1
of this Agreement.                                                    

      (i) Neither Tyler, the Surviving Corporation, nor any other person
    shall be liable to any former holder of shares of Company Common Stock for
   any amount properly delivered to a public official pursuant to applicable
abandoned property, escheat or similar laws.                          

        (j) In the event any certificate formerly representing shares of the
  Company Common Stock shall have been lost, stolen or destroyed, upon the
     making of an affidavit of that fact by the person claiming such certificate
    to be lost, stolen or destroyed and, if required by Tyler or the Surviving
  Corporation, the posting by such person of a bond in customary amount as
     indemnity against any claim that may be made against Tyler or the Surviving
 Corporation with respect to such certificate, the Surviving Corporation
  shall deliver in exchange for such lost, stolen or destroyed certificate
the cash and shares of Tyler Common Stock that would be deliverable   
pursuant to this Article 1 upon due surrender of the shares of Company
 Common Stock represented by such lost, stolen or destroyed certificate.
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    1.8  Additional Consideration. In addition to the Consideration payable to
the holders of Company Common Stock pursuant to Section 1.7(a), the holders of  
Class A Common Stock of the Company shall be entitled to receive additional     
merger consideration ("Additional Merger Consideration") in an aggregate amount 
up to $4,500,000 if certain performance objectives set forth in a letter dated  
October 8, 1997 from Tyler to the Shareholder and the Company are achieved not  
later than December 31, 1999. In such event each holder of record of Class A    
Common Stock of the Company immediately prior to the Effective Time shall       
receive for each share so held Additional Merger Consideration equal to the     
quotient of $4,500,000 (or such lesser amount as may be payable) divided by the 
number of shares of Class A Common Stock of the Company issued and outstanding  
immediately prior to the Effective Time.                                        

     1.9  Adjustments to Prevent Dilution. In the event that the Company changes
the number of shares of the Company Common Stock or securities convertible or   
exchangeable into or exercisable for shares of the Company Common Stock, or     
Tyler changes the number of shares of Tyler Common Stock or securities          
convertible or exchangeable into or exercisable for shares of Tyler Common      
Stock, issued and outstanding prior to the Effective Time as a result of a      
reclassification, stock split (including a reverse split or combination), stock 
dividend or distribution, recapitalization, subdivision, or other similar       
transaction, the Consideration shall be correspondingly adjusted.               

    1.10  Taking of Necessary Action; Further Action. The parties hereto shall
take all such reasonable and lawful action as may be necessary or appropriate in
order to effectuate the Merger as promptly as possible. If at any time after the
Effective Time any further action is necessary or desirable to carry out the    
purposes of this Agreement and to vest the Surviving Corporation with full      
right, title and possession to all assets, property, rights, privileges, powers 
and franchises of the Company or Sub, such corporations shall direct their      
respective officers and directors to take, and the Shareholder shall take, all  
such lawful and necessary action.                                               

ARTICLE 2 

REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SHAREHOLDER 

     The Company and the Shareholder jointly and severally represent and warrant
to Tyler and Sub as follows:                                                    

2.1  Organization and Good Standing of Company. The Company is a      
corporation duly organized, validly existing, and in good standing under the    
laws of the State of Texas.                                                     

     2.2  Organization and Good Standing of Company Subsidiaries. Section 2.2 of
the schedule delivered by the Company concurrently with the execution of this   
Agreement (the "Company Disclosure Schedule") truly and correctly lists each    
corporation in which either the Company or a Company Subsidiary is the record or
beneficial owner, directly or indirectly, of 50% or more of the capital stock   
(each such corporation being referred to as a "Company Subsidiary"), the        
jurisdiction of incorporation of each Company Subsidiary, the authorized number 
of shares of capital stock of each Company Subsidiary, the number of outstanding
shares of capital stock of each Company Subsidiary and the number of shares     
owned by the Company or a Company Subsidiary, and the jurisdictions in which the
Company and each Company Subsidiary are qualified or licensed to do business.   
Each Company Subsidiary is a corporation duly organized, validly existing, and  
in good standing under the laws of the jurisdiction of its incorporation.       

2.3  Other Investments. Section 2.3 of the Company Disclosure Schedule
truly and correctly lists all corporations in which the Company or a Company    
Subsidiary owns less than 50% of the capital stock and all partnerships, joint  
ventures, and other entities in which the Company or a Company Subsidiary has an
equity, profit sharing, participation, or other interest (the "Company          
Investments"), the form of organization of and the jurisdiction of incorporation
or organization of each Company Investment, the type and amount of the          
investment, and the percentage interest owned by the Company or a Company       
Subsidiary.                                                                     

 2.4  Foreign Qualification. The Company and each Company Subsidiary are
duly qualified or licensed to do business as foreign corporations and in good   
standing in those jurisdictions set forth in Section 2.4 of the Company         
Disclosure Schedule. The Company and the Company Subsidiaries are duly qualified
or licensed to                                                                  

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do business as foreign corporations in every jurisdiction where the failure so  
to qualify could have a material adverse effect on the businesses, operations,  
assets or financial condition of the Company and the Company Subsidiaries, taken
as a whole. For purposes of this Section 2.4, no material adverse effect shall  
be deemed to have occurred as a result of non-payment of state or local         
franchise taxes not exceeding $75,000 in the aggregate.                         

   2.5  Power and Authority to Conduct Business. The Company and the Company
Subsidiaries have the corporate power and authority, and possess all licenses   
and permits required by governmental authorities, to own, lease, and operate    
their properties and assets and to carry on its or their respective businesses  
as currently being conducted, except where the failure to possess such license  
or permit would not have a material adverse effect on the businesses,           
operations, assets or financial condition of the Company and the Company        
Subsidiaries, taken as a whole.                                                 

  2.6  Authority to Consummate Merger. The Company has the corporate power
and authority to execute, deliver and perform its obligations under this        
Agreement and the other agreements or documents executed or required to be      
executed by the Company in connection with this Agreement, and the execution,   
delivery, and performance by the Company of this Agreement and the other        
documents executed or required to be executed by the Company in connection with 
this Agreement have been duly authorized by all necessary corporate action other
than approval by holders of the Class B Common Stock. The Shareholder has the   
capacity and authority to execute, deliver and perform his obligations under    
this Agreement, and the other agreements or documents executed or required to be
executed by him in connection herewith.                                         

    2.7  Binding Effect. This Agreement and the other agreements and documents
executed or required to be executed by the Company or the Shareholder in        
connection with this Agreement have been or will have been duly executed and    
delivered by the Company or the Shareholder, as appropriate, and are or will be,
when executed and delivered, the legal, valid, and binding obligations of the   
Company or the Shareholder executing the same, enforceable in accordance with   
their terms, except that:                                                       

         (a) enforceability may be limited by bankruptcy, insolvency, or other
similar laws affecting creditors' rights;                             

          (b) the availability of equitable remedies may be limited by equitable
principles of general applicability; and                              

      (c) rights to indemnification under Section 10.6 may be limited by
considerations of public policy.                                      

    2.8  Compliance with Other Instruments. Except as disclosed in Section 2.8
of the Company Disclosure Schedule, neither the execution and delivery by the   
Company or the Shareholder of this Agreement, or the other agreements or        
documents executed or required to be executed by the Company or the Shareholder 
in connection herewith, nor the consummation by the Company or the Shareholder  
of the transactions contemplated hereby and thereby, will (i) conflict with the 
articles of incorporation or bylaws of the Company or any Company Subsidiary,   
(ii) assuming satisfaction of the requirements set forth in clause (iii) below, 
violate any provision of law applicable to the Company or any of the Company    
Subsidiaries; (iii) except for (A) requirements arising out of the              
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), and (B)   
the filing of articles of merger in accordance with the TBCA, require any       
consent, authorization, permit, license or approval of, or declaration,         
registration or filing with or notice to, any person or governmental body or    
authority, domestic or foreign, under any provision of law applicable to the    
Company or any of the Company Subsidiaries; or (iv) require any consent,        
approval or notice under, violate, breach, be in conflict with, or constitute a 
default (or an event that, with notice or lapse of time or both, would          
constitute a default) under, or permit the termination or the acceleration of   
maturity of, or result in the imposition of any lien, claim, or encumbrance upon
any property or asset of the Company, any Company Subsidiary, or the            
Shareholder, pursuant to any note, bond, indenture, mortgage, deed of trust,    
evidence of indebtedness, loan or lease agreement, or other agreement or        
instrument (including with customers) listed or required to be listed in Section
2.21 of the Company Disclosure Schedule, or any judgment, order, injunction, or 
decree by which the Company, any Company Subsidiary, or the Shareholder is      
bound, to which any of them is a party, or to which any of their assets is      
subject, where any such failure to obtain any consent, approval or notice, or   
violation,                                                                      
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breach, conflict or default would result in a material adverse effect on the    
businesses, operations, assets or financial condition of the Company and the    
Company Subsidiaries, taken as a whole.                                         

2.9  Capitalization of Company.                                       

 (a) The authorized capital stock of the Company at December 29, 1997 is
100,000 shares of Company Common Stock, of which 87,650 shares consist of Class 
A Common Stock and 12,350 shares consist of Class B Common Stock. All of the    
authorized shares of Company Common Stock are issued and outstanding at December
29, 1997, have been duly authorized and are validly issued, fully paid and      
nonassessable. There are and at the Closing will be no shares of the capital    
stock of the Company held in its treasury or in the treasury of any Company     
Subsidiary.                                                                     

  (b) At the Closing, Shareholder will be the lawful record and beneficial
owner of 87,650 shares of the Class A Common Stock, free and clear of all liens,
encumbrances, and claims of every kind, and the shares so owned by the          
Shareholder will constitute 100% of the issued and outstanding shares of the    
Class A Common Stock, which is the only class of Company Common Stock having    
voting rights with respect to the election of directors and other regular       
matters. The Shareholder has the right to vote or direct the vote of such shares
at his discretion on any matter submitted to a vote of the Company's            
shareholders. Holders of the Class B Common Stock have no voting rights except  
as may be required by law. Pursuant to the Texas Business Corporation Act,      
holders of all classes of Company Common Stock, including the Class B Common    
Stock, are or will be entitled to vote upon the Merger, with all holders of     
Company Common Stock voting as a single class and all holders of Class A Common 
Stock and Class B Common Stock each voting as separate classes. Each holder of  
shares of Class A Common Stock and Class B Common Stock has voted or agreed to  
vote such shares in favor of the Merger.                                        

 (c) There are no voting trusts, shareholder agreements, or other voting
arrangements among the shareholders of the Company, other than the agreements to
vote their shares in favor of the Merger described in the form of Stock Transfer
Agreement attached as Exhibit C.                                                

    (d) Except as described in Section 2.9 of the Company Disclosure Schedule,
there presently is no outstanding subscription, contract, convertible or        
exchangeable security, option, warrant, call, or other right obligating the     
Company, any Company Subsidiary, or the Shareholder to issue, sell, exchange, or
otherwise dispose of, or to purchase, redeem, or otherwise acquire, shares of,  
or securities convertible into or exchangeable for, capital stock of the        
Company; except as described in Section 2.9 of the Company Disclosure Schedule  
or otherwise permitted by this Agreement, no such rights disclosed in Section   
2.9 of the Company Disclosure Schedule will remain outstanding at the Closing.  
No shareholder of the Company is entitled to any preemptive right.              

  2.10  Capitalization of the Company Subsidiaries. All of the outstanding
shares of capital stock of the Company Subsidiaries have been duly authorized   
and validly issued and are fully paid and nonassessable and, except as described
in Section 2.10 of the Company Disclosure Schedule, the shares of capital stock 
of the Company Subsidiaries indicated in Section 2.2 of the Company Disclosure  
Schedule as owned by the Company or a Company Subsidiary are owned free and     
clear of all liens, encumbrances, and claims of every kind. The Company owns of 
record and beneficially all of the issued and outstanding shares of capital     
stock of each Company Subsidiary. Except as described in Section 2.10 of the    
Company Disclosure Schedule, there presently is no outstanding subscription,    
contract, convertible or exchangeable security, option, warrant, call, or other 
right obligating the Company, any Company Subsidiary, or the Shareholder to     
issue, sell, exchange, or otherwise dispose of, or to purchase, redeem, or      
otherwise acquire, shares of, or securities convertible into or exchangeable    
for, capital stock of any Company Subsidiary.                                   

2.11  Company Investments. Except as described in Section 2.11 of the 
Company Disclosure Schedule, the interests in the Company Investments owned by  
the Company or a Company Subsidiary are owned free and clear of all liens,      
encumbrances and claims other than those contained in the agreements evidencing 
such Company Investments. Except as described in Section 2.11 of the Company    
Disclosure Schedule, there presently is no outstanding subscription, contract,  
convertible or exchangeable security, option, warrant, call, or other right     
obligating the Company or any Company Subsidiary to sell, exchange, or otherwise
dispose of,                                                                     

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or to purchase, redeem, or otherwise acquire, any interest in the Company       
Investments; no such rights disclosed in Section 2.11 of the Company Disclosure 
Schedule will remain outstanding at the Closing.                                

2.12  Company Financial Statements.                                   

   (a) The Company has delivered to Tyler true, correct, and complete copies
of the following financial statements of the Company (the "Company Financial    
Statements"), which are attached to Section 2.12 of the Company Disclosure      
Schedule:                                                                       

      (i) the audited consolidated balance sheets of the Company and the
     Company Subsidiaries as of December 31, 1996, 1995 and 1994 and the related
  audited consolidated statements of operations, stockholder's equity, and
cash flows for the years then ended, with notes thereto, prepared in  
 accordance with United States generally accepted accounting principles,
    reported upon without exception or qualification by KPMG Peat Marwick LLP,
independent certified public accountants ("Peat Marwick"), and        

      (ii) the audited consolidated balance sheet of the Company and the
     Company Subsidiaries as of July 31, 1997 (the "Company Balance Sheet"), and
  the related audited consolidated statements of operations, stockholder's
     equity, and cash flows for the seven months then ended, with notes thereto,
 prepared in accordance with United States generally accepted accounting
principles, reported upon without exception or qualification by Peat  
Marwick.                                                              

The Company Financial Statements present fairly, in all respects, the           
consolidated financial position of the Company and the Company Subsidiaries as  
of the dates thereof and the consolidated results of operations and cash flows  
for the periods then ended, in conformity with generally accepted accounting    
principles applied, except as may be set forth in the notes thereto, on a       
consistent basis throughout such periods.                                       

    (b) Since July 31, 1997, there has been no change in accounting principles
applicable to, or methods of accounting utilized by the Company, and the books  
and records of Company and the Company Subsidiaries have been and are being     
maintained in accordance with all applicable legal and accounting requirements  
and what the shareholder believes in good faith to be good business practice,   
reflect only valid transactions, are complete and correct in all material       
respects, and accurately reflect in all material respects the basis for the     
consolidated financial position and consolidated results of operations and cash 
flows of the Company and the Company Subsidiaries set forth in the Company      
Financial Statements.                                                           

2.13  Absence of Certain Changes. Since July 31, 1997 (or other date  
indicated below), neither the Company nor any Company Subsidiary has (except as 
may be contemplated by this Agreement or as may result from the transactions    
contemplated by this Agreement):                                                

     (a) suffered any change in its businesses, results of operations,
    working capital, assets, liabilities, or financial condition or the manner
    of conducting its business other than changes that, individually or in the
aggregate, have not had a material adverse effect on the businesses,  
     operations, assets or condition (financial or otherwise) of the Company and
the Company Subsidiaries, taken as a whole;                           

         (b) experienced a decline in the consolidated shareholder's equity of
the Company and the Company Subsidiaries from its consolidated        
   shareholder's equity shown on the Company Balance Sheet at July 31, 1997,
    determined using the same accounting principles applied in the preparation
of the Company Financial Statements;                                  

     (c) except as disclosed in Section 2.13 of the Company Disclosure
   Schedule, suffered any damage or destruction to or loss of its assets not
    covered by insurance, or any loss of customers or suppliers, or terminated
  or lost the services of any key employee (including any employee who had
   agreed with the Company to maintain the confidentiality of proprietary or
technical information or know-how or to assign inventions, patents, or
     copyrights) that has had, or in the good faith belief of the Shareholder is
  likely to have, a material adverse effect on the businesses, operations,
  assets, financial condition, or prospects of the Company and the Company
Subsidiaries, taken as a whole;                                       

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         (d) acquired or disposed of any material asset, or incurred, assumed,
guaranteed, endorsed, paid, or discharged any material indebtedness,  
 liability, or obligation, or subjected or permitted to be subjected any
   material amount of assets to any lien, claim, or encumbrance of any kind,
except in the ordinary course of business or pursuant to agreements in
force at the date of this Agreement;                                  

          (e) forgiven, compromised, canceled, released, waived, or permitted to
lapse any material rights or claims;                                  

        (f) entered into or terminated any material agreement or commitment,
    or agreed or made any changes in material leases or agreements, other than
renewals or extensions thereof and leases, agreements, and commitments
   entered into, terminated, or modified in the ordinary course of business;

      (g) increased its investment in any Company Investment or made new
Company Investments;                                                  

      (h) written up, written down, or written off the book value of any
material amount of assets;                                            

(i) declared, paid, or set aside for payment any dividend or
distribution with respect to its capital stock;                       

        (j) redeemed, purchased, or otherwise acquired, or sold, granted, or
    otherwise disposed of, directly or indirectly, any of its capital stock or
  securities or any rights to acquire such capital stock or securities, or
agreed to changes in the terms and conditions of any such rights;     

 (k) paid compensation, fees, bonuses or other payments to the
 Shareholder or his family members or any of his affiliates or otherwise
  paid or transferred any cash, property or assets to the Shareholder, his
family members or any of his affiliates, other than the base salary of
Shareholder, rent in accordance with the Lease (as defined in Section 
5.11), and distributions permitted by this Agreement; or materially   
  increased the compensation of or paid any bonus to any other employee or
contributed to any employee benefit plan other than in accordance with
   policies, practices or requirements established and in effect on December
31, 1996;                                                             

(l) Entered into any employment, compensation, or collective
   bargaining agreement with any person or group or consulting agreement not
     identified in Section 5.3 of the Company Disclosure Schedule, other than in
the ordinary course of business;                                      

         (m) Entered into, adopted, or materially amended any employee benefit
plan; or                                                              

     (n) Entered into any other material commitment or transaction not
 disclosed elsewhere herein or in the Company Disclosure Schedule, other
than in the ordinary course of business.                              

    2.14  No Material Undisclosed Liabilities. To the knowledge of the Company
or the Shareholder, there is no liability or obligation of the Company and the  
Company Subsidiaries of any nature, whether absolute, accrued, contingent, or   
otherwise, other than:                                                          

          (a) the liabilities and obligations that are fully reflected, accrued,
  or reserved against on the Company Balance Sheet, for which the reserves
are appropriate and reasonable, or incurred in the ordinary course of 
business and consistent with past practices since July 31, 1997;      

       (b) the loss contingencies set forth in Section 2.14 of the Company
Disclosure Schedule;                                                  

          (c) contractual liabilities or obligations of a nature not required to
be disclosed on a balance sheet prepared in accordance with generally 
  accepted accounting principles, but which, if material, are disclosed in
Section 2.14 of the Company Disclosure Schedule; and                  

          (d) other liabilities and loss contingencies which are not material in
   the aggregate to the business, operations, assets or condition (financial
or otherwise) of the Company and the Company Subsidiaries, taken as a 
whole.                                                                

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  The Company and the Company Subsidiaries are not signatories to, and are
not in any manner a guarantor, endorser, assumptor or otherwise primarily or    
secondarily liable for or responsible for the payment of, any notes payable     
other than those set forth in Section 2.21 of the Company Disclosure Schedule.  

   2.15  Tax Liabilities. The Company and each Company Subsidiary have filed
all material federal, state, county, local, and foreign tax returns and reports 
required to be filed by them, including those with respect to income, payroll,  
property, withholding, social security, unemployment, franchise, excise, use and
sales taxes, and have either paid in full all taxes that have become due as     
reflected on any such return or report and any interest and penalties with      
respect thereto or, as of July 31, 1997, they have fully accrued on their books 
or have established adequate reserves for all taxes payable but not yet due,    
except that at July 31, 1997, the unrecorded contingent liability of the Company
and the Company Subsidiaries with respect to payroll, withholding, social       
security, unemployment, franchise, property, sales, use and excise taxes did not
exceed $75,000 in the aggregate for all such taxes. The total of all payments in
1997 of taxes, interest and penalties of the Company and the Company            
Subsidiaries for periods ended prior to January 1, 1997 have not exceeded the   
accrued liability for such items shown on the Company Financial Statements as of
July 31, 1997 for periods ended December 31, 1996; neither the Company nor any  
Company Subsidiary has, subsequent to December 31, 1996, accrued or set aside   
any reserves on its books and records for any taxes, interest or penalties for  
any period ended prior to January 1, 1997 nor has any of them made any payments 
in 1997 of taxes, interest or penalties for periods ended prior to January 1,   
1997 that were not reflected in the accrued liability therefor (including       
deferred taxes) shown on the Company Financial Statements as of July 31, 1997   
for periods ended December 31, 1996. There are no reserves (other than for      
deferred taxes) reflected in the Company Financial Statements as of July 31,    
1997 for periods ended December 31, 1996 for taxes, interest or penalties in    
excess of those shown to be due on any tax returns that have been filed for any 
periods then ended. Neither the Internal Revenue Service nor any other taxing   
authority has audited or is in the process of auditing the tax returns and      
reports of the Company and the Company Subsidiaries, and no claim for additional
taxes, interest, or penalties for any fiscal year is pending. The Company and   
the Company Subsidiaries have delivered to Tyler true, complete and correct     
copies of (i) all federal and state income or franchise tax returns for the     
Company and the Company Subsidiaries for all periods ending on and after        
December 31, 1994 and (ii) relevant portions of income and franchise tax        
examination reports, statements of deficiencies, closing or other agreements    
received by, assessed against or agreed to by the Company or any of the Company 
Subsidiaries, relating to such taxes, since December 31, 1994, if any. No       
extension or waiver of any statute of limitations has been requested of or      
granted by the Company or any Company Subsidiary with respect to any tax year,  
and no extension or waiver of time within which to file any tax return has been 
requested by or granted to the Company or any Company Subsidiary except with    
respect to tax returns not yet filed but otherwise due. No unsatisfied          
deficiency, delinquency, or default for any tax, assessment, or governmental    
charge has been claimed or assessed, or to the knowledge of the Company and     
Shareholder, proposed against the Company or any Company Subsidiary, nor has the
Company or any Company Subsidiary received notice of any such deficiency,       
delinquency, or default, for any tax period. Neither the Company nor Shareholder
has any reason to believe that the Company or any Company Subsidiary has any    
material contingent income tax liabilities other than those reflected on the    
Company Balance Sheet and those arising in the ordinary course of business since
the date thereof, and those arising as a result of the transactions contemplated
hereby. The Company has qualified and elected to be taxed as a "small business  
corporation" or "S corporation" under Section 1361, et seq., of the Code since  
January 1, 1997.                                                                

2.16  Title to Properties.                                            

    (a) Section 2.16(a) of the Company Disclosure Schedule lists or depicts on
a map the location of the Headquarters Facilities (as defined in Section 5.11)  
and each parcel of real property owned by the Company and the Company           
Subsidiaries, summary descriptions of the real property and all improvements    
located thereon, and the approximate acreage contained therein.                 

    (b) Except as they have since been affected subsequent to July 31, 1997 by
transactions in the ordinary course of business and consistent with past        
practices, and except for assets subject to financing leases required to be     
capitalized under generally accepted accounting principles which are reflected  
in the Company Balance Sheet or notes thereto, the Company and the Company      
Subsidiaries have good and marketable title to the                              
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assets reflected in the Company Balance Sheet or otherwise on their books and   
records as being owned as of July 31, 1997, or purchased or otherwise acquired  
by any of them since July 31, 1997, and the Company has good and marketable     
title to or valid licenses to use the assets described in Section 2.20 below and
to the following assets whether or not reflected in the Company Balance Sheet or
on such books and records:                                                      

      (i) Title or abstract plants meeting the requirements of the Texas
     Insurance Code for the Texas counties of Collin, Denton and Tarrant, and as
    an integral part thereof the computer data files of and the magnetic tapes
   containing information abstracted for title plant purposes from documents
  maintained by county clerks or recorders or other governmental officials
and the microfilm of such documents created for title plant purposes; 

          (ii) The computer data files and magnetic tapes containing information
    abstracted for purposes of preparing printed copies of indices provided as
    a service to county clerks, recorders or other governmental officials from
     documents maintained by such county clerks, recorders or other governmental
officials (but not the printed copies of such indices or the microfilm
created as a service to such officials);                              

         (iii) The computer programs and applications software, in both object
code and source code form, and all documentation therefor (excluding  
 operating systems software leased by or licensed to the Company and the
    Company Subsidiaries) utilized by the Company and the Company Subsidiaries
 to provide on-line services to their title insurance company customers;

        (iv) The computer programs and applications software, in both object
code and source code form, and all documentation therefor (excluding  
 operating systems software leased by or licensed to the Company and the
    Company Subsidiaries) utilized by the Company and the Company Subsidiaries
for any other applications, including data entry, batch processing for
 county customers, microcomputers installed at county offices, financial
applications and providing computer output microfilm; and             

 (v) The camera equipment installed at county offices which is
identified in Section 2.16(b) of the Company Disclosure Schedule.     

    (c) The assets identified in subsection (b) above and the assets described
in Section 2.20 below are owned by or licensed to the Company or the Company    
Subsidiaries, and the Headquarters Facilities will be transferred by the        
Shareholder to Sub, free and clear of any lien, claim or encumbrance except     
those disclosed in the Company Balance Sheet or notes thereto or in Section     
2.16(c) of the Company Disclosure Schedule and except for:                      

       (i) Liens for taxes, assessments, or other governmental charges not
    yet delinquent, or the validity of which are being contested in good faith
by appropriate proceedings listed in Section 2.16(c) of the Company   
Disclosure Schedule;                                                  

         (ii) Statutory liens incurred in the ordinary course of business that
 are not yet delinquent, or the validity of which are being contested in
   good faith by appropriate proceedings described in Section 2.16(c) of the
Company Disclosure Schedule;                                          

          (iii) The rights of customers of the Company or any Company Subsidiary
with respect to inventory or work in progress under purchase orders or
contracts entered into by the Company or a Company Subsidiary in the  
ordinary course of business;                                          

         (iv) Liens, claims, or encumbrances consisting of leases of equipment
to customers entered into in the ordinary course of business;         

     (v) Liens, claims, or encumbrances described in real estate title
 insurance binders or commitments, or abstracts of title to real estate,
   furnished or to be furnished to Tyler in connection with the transactions
 contemplated hereby, unless Tyler objects to the same in writing within
five business days after receipt of such title documents;             

         (vi) Restrictions and constraints set forth in the license agreements
described in Section 2.20 of the Company Disclosure Schedule; and     

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         (vii) Other liens, claims, or encumbrances that, in the aggregate, do
    not materially detract from the value of, or materially interfere with the
present use of, such assets.                                          

    (d) Except for those assets acquired since the date of the Company Balance
Sheet, all tangible properties and assets material to the present operations of 
the Company and the Company Subsidiaries are reflected on the Company Balance   
Sheet and notes thereto in the manner and to the extent required by generally   
accepted accounting principles. Immediately after the Closing, the Company and  
the Company Subsidiaries will own or lease or otherwise possess the rights to   
use all assets necessary to the conduct of the business conducted by Company and
the Company Subsidiaries immediately before the Closing.                        

    2.17  Condition of Tangible Assets. Except as set forth in Section 2.17 of
the Company Disclosure Schedule, the tangible assets of the Company and the     
Company Subsidiaries which are material to the business, operations, assets or  
financial condition of the Company and the Company Subsidiaries, taken as a     
whole, are in good condition and repair and, in the good faith belief of the    
Shareholder, are adequate for the uses to which they are being put in the       
ordinary course of their respective businesses.                                 

2.18  Accounts Receivable. To the knowledge of the Company and the    
Shareholder, all accounts receivable reflected in the Company Balance Sheet or  
arising since July 31, 1997 either have been collected or are enforceable and   
collectible claims not subject to any valid defense, offset, or credit, except  
to the extent of any reserves established for doubtful accounts in a manner     
consistent with such practices in prior periods.                                

   2.19  Inventory Good and Salable. To the knowledge of the Company and the
Shareholder, the inventories reflected in the Company Balance Sheet or acquired 
after July 31, 1997 consist generally of items of a quantity and quality usable 
and salable in the ordinary course of the business of the Company and the       
Company Subsidiaries.                                                           

     2.20  Patents, Trademarks, and Copyrights. Set forth in Section 2.20 of the
Company Disclosure Schedule is a true and correct description of:               

     (a) all material trademarks, trade names, service marks, patents,
     copyrights, and applications therefor and all license, royalty, assignment,
    and other similar agreements relating to the foregoing currently owned, in
whole or in part, by the Company or any Company Subsidiary;           

    (b) all material agreements relating to technology, know-how, or
processes that the Company or any Company Subsidiary is licensed or   
  authorized to use by others or licenses or authorizes others to use; and

       (c) all computer programs and applications software utilized by the
   Company or the Company Subsidiaries and all license, royalty, assignment,
and other similar agreements relating to the foregoing.               

Except to the extent set forth in Section 2.20 of the Company Disclosure        
Schedule, the Company or a Company Subsidiary has, to the knowledge of the      
Company and the Shareholder, the sole and exclusive right to use the patents,   
trademarks, trade names, copyrights, service marks, technology, know-how, and   
processes identified in such Section 2.20 without infringing or violating the   
rights of any other person, and to the knowledge of the Company and the         
Shareholder no consent of third parties will be required for the use thereof by 
the Company upon consummation of the Merger and there are no past due or        
delinquent license fees, rents, royalties, or other charges that the Company is 
required or obligated to pay with respect to any of the foregoing. Except as    
disclosed in Section 2.20 of the Company Disclosure Schedule, no claim has been 
asserted by any person to the ownership of or right to use any such patent,     
trademark, trade name, copyright, service mark, technology, know-how, or process
or challenging or questioning the validity or effectiveness of any such license 
or agreement, and the Company knows of no valid basis for any such claim. To the
knowledge of the Company and the Shareholder, except as disclosed in Section    
2.20 of the Company Disclosure Schedule, each of the foregoing is valid and     
subsisting, has not been canceled, abandoned, or otherwise terminated, and, if  
applicable, has been duly issued or filed.                                      

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2.21  Contracts. Set forth in Section 2.21 of the Company Disclosure  
Schedule are complete and accurate lists of the following contracts and         
commitments (including summaries of oral contracts) to which the Company or any 
Company Subsidiary is a party or bound:                                         

(a) Contracts with any labor union;                         

(b) Employee benefit plans or contracts;                    

  (c) Employment or similar contracts, including confidentiality
     agreements and agreements to assign inventions, patents and copyrights, and
     consulting agreements (other than those entered into in the ordinary course
of business);                                                         

    (d) Leases, whether as lessor or lessee, involving annual rental
payments in excess of $15,000, that are not terminable at will or upon
notice of 30 days or less by the Company or a Company Subsidiary;     

(e) Loan agreements, mortgages, indentures, instruments of  
  indebtedness or commitments involving indebtedness for borrowed money or
 money loaned to others in excess of $15,000, but excluding intercompany
items;                                                                

     (f) Guaranty or suretyship, performance bond, indemnification, or
 contribution agreements involving obligations in excess of $15,000, but
excluding intercompany items;                                         

    (g) Contracts with customers or suppliers that involve aggregate
payments to or by the Company or any Company Subsidiary of more than  
   $15,000, and that are not terminable at will or upon notice of 30 days or
less by the Company or a Company Subsidiary;                          

        (h) Distribution, marketing, dealership, sales, or agency agreements
 material to the Company and the Company Subsidiaries, taken as a whole,
  that are not terminable at will or upon notice of 30 days or less by the
Company or a Company Subsidiary;                                      

     (i) Joint venture, partnership, or other agreements evidencing an
ownership interest or a participation in or sharing of profits;       

   (j) Contracts containing noncompetition covenants, covenants to
  register securities, or negative or restrictive financial covenants that
     are not terminable at will or upon notice of 30 days or less by the Company
or a Company Subsidiary;                                              

      (k) Voting agreements relating to securities of the Company or the
Company Subsidiaries (whether or not any of those entities is a party 
thereto);                                                             

         (l) Insurance policies involving annual premium payments of more than
$1,500;                                                               

(m) Powers of attorney;                                     

       (n) Contracts between the Company or any Company Subsidiary and the
Shareholder, his spouse, or any affiliate or relative thereof; and    

      (o) Other contracts not made in the ordinary course of business or
  that, in the reasonable judgment of the Shareholder, are material to the
   businesses, operations, assets, or financial condition of the Company and
the Company Subsidiaries, taken as a whole.                           

Included in the list of customers specified in subsection (g) above, and so     
identified, are all contracts and commitments, whether written or oral, relating
to the purchase, sale or lease of abstract or title plants by the Company and   
the Company Subsidiaries in 1996 and 1997. No contract or commitment listed in  
Section 2.21 of the Company Disclosure Schedule has been amended or modified or 
the rights and obligations evidenced thereby otherwise affected in a manner     
materially adverse to the Company or the Company Subsidiaries, except by an     
instrument which is also included in such listing, and each contract or         
commitment, as so amended, modified or affected, contains all material          
provisions with respect to the subject matter thereof. The Company and the      
Shareholder have furnished or made available to Tyler accurate and complete     
copies of all of the contracts, commitments or instruments listed in Section    
2.21 of the Company Disclosure Schedule.                                        

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Except as set forth in Section 2.21 of the Company Disclosure Schedule or with  
respect to contracts not material to the businesses, operations, assets or      
financial condition of the Company and the Company Subsidiaries, taken as a     
whole, (i) to the knowledge of the Company and the Shareholder, all such        
contracts are valid, binding, subsisting, and enforceable in all material       
respects; (ii) to the knowledge of the Company and the Shareholder and in their 
good faith belief the Merger will not affect the continuance in full force and  
effect of such contracts; and (iii) there is no material dispute among the      
parties to any such contract and no material penalty has been incurred with     
respect thereto. Except as set forth in Section 2.21 of the Company Disclosure  
Schedule, neither the Company nor any Company Subsidiary nor the Shareholder has
received notice of any plan or intention of any other party to any such contract
or agreement to exercise any right to cancel or terminate any such contract or  
agreement, and neither the Company nor any Company Subsidiary nor the           
Shareholder knows of any fact that would justify the exercise of such right.    
Neither the Company nor any Company Subsidiary nor the Shareholder currently    
contemplates, or has any reason to believe any other person or entity currently 
contemplates, any amendment or change to any of the contracts or agreements     
referred to in Section 2.21 of the Company Disclosure Schedule. Except as       
disclosed in Section 2.21 of the Company Disclosure Schedule, none of the       
Company's or the Company Subsidiaries' customers or suppliers, that during the  
year ended December 31, 1996 accounted for as much as 2% of consolidated sales  
or purchases of the Company and the Company Subsidiaries, has refused, or       
communicated that it will or may refuse, to purchase or supply goods or         
services, as the case may be, or has communicated that it will or may           
substantially reduce the amount of goods or services that it is willing to      
purchase from, or sell to, the Company or any Company Subsidiary after the date 
hereof.                                                                         

     2.22  Litigation and Claims. Neither the Company nor any Company Subsidiary
nor the Shareholder is a party to, and the businesses or assets of the Company  
and the Company Subsidiaries are not the subject of or affected by, any pending 
or to the knowledge of the Company or the Shareholder, threatened suit, claim,  
action, or litigation with any party or any administrative, arbitration, or     
other governmental proceeding, investigation, or inquiry, or any pending change 
in any regulations, statutes or ordinances, which would, severally or in the    
aggregate, have a material adverse effect on the businesses, results of         
operations, assets, or the condition (financial or otherwise) of the Company and
the Company Subsidiaries, taken as a whole. To the knowledge of the Company or  
the Shareholder, no suit, claim, action or demand is currently pending, has been
made or filed, or is or has been threatened or contemplated by any person or    
entity, and there exists no judgment or order (whether or not the Company or a  
Company Subsidiary is a party to any of the foregoing) regarding or affecting   
the ownership, disclosure, copying, possession or utilization by the Company or 
the Company Subsidiaries of the assets reflected in the books and records of the
Company or the Company Subsidiaries, or (whether or not so reflected) the       
microfilm in the possession of the Company and the Company Subsidiaries of title
documents filed in any county clerk's or recorder's office with which they      
conduct business, computer data files and magnetic tapes containing information 
abstracted from such title documents, indices (other than copies of             
grantor/grantee indices provided as a service to county clerks or recorders)    
generated from such data files utilizing the computer systems of the Company and
the Company Subsidiaries, software programs used in their businesses, and the   
computers and peripheral equipment and the other equipment and machines used in 
their businesses.                                                               

    2.23  Judgments, Decrees, and Orders in Restraint of Business. Neither the
Company nor any Company Subsidiary is a party to or subject to any judgment,    
order, or decree entered in any suit or proceeding brought by any governmental  
agency or by any other person enjoining it in respect of any business practice  
or the acquisition of any property or the conduct of its business.              

   2.24  No Violation of Any Instrument. Neither the Company nor any Company
Subsidiary is in violation of or default under nor, to the knowledge of the     
Company or the Shareholder, has any event occurred that, with or without the    
giving of notice, lapse of time or the occurrence of any other event, would     
constitute a violation of or default under, or permit the termination or the    
acceleration of maturity of, or result in the imposition of a lien, claim, or   
encumbrance upon any property or asset of the Company or any Company Subsidiary 
pursuant to, the articles or certificate of incorporation or bylaws of the      
Company or any Company Subsidiary or any note, bond, indenture, mortgage, deed  
of trust, evidence of indebtedness, loan or lease agreement, or other agreement 
or instrument (including with customers) listed or required to be listed in     

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Section 2.21 of the Company Disclosure Schedule, or any judgment, order,        
injunction, or decree, to which it is a party, by which it is bound, or to which
any of its assets is subject, which would have a material adverse effect on the 
businesses, operations, assets or financial condition of the Company and the    
Company Subsidiaries, taken as a whole.                                         

  2.25  Compliance With Laws. The Company and the Company Subsidiaries are
substantially in compliance with all laws applicable to their businesses, where 
failure so to comply would have a material adverse effect on the businesses,    
operations, assets, prospects, or financial condition of the Company and the    
Company Subsidiaries, taken as a whole.                                         

2.26  Compensation and Benefit Plans.                                 

     (a) Section 2.26 of the Company Disclosure Schedule includes a complete and
accurate list of all pension, profit sharing, Section 401(k), thrift-savings,   
simplified employee pension, excess benefit plan, deferred compensation,        
incentive compensation, stock bonus, stock option, restricted stock, cash bonus,
employee stock ownership, severance pay, golden parachute, cafeteria, flexible  
compensation, life insurance, medical, dental, disability, welfare, or vacation 
plans or arrangements of any kind and any other Employee Pension Benefit Plan or
Employee Welfare Benefit Plan (as such terms are defined in the Employee        
Retirement Income Security Act of 1974, as amended ("ERISA")) in which employees
or former employees of the Company or any Company Subsidiary participate        
(collectively, the "Benefit Plans").                                            

   (b) Neither the Company nor any Company Subsidiary participates currently
in or has ever participated in, or is required currently to or has ever been    
required to contribute to or otherwise participate in, any "multi-employer      
plan," as defined in Sections 3(37)(A) and 4001(a)(3) of ERISA and Section      
414(f) of the Code. Neither the Company nor any Company Subsidiary participates 
currently in or has ever participated in, or is required currently to or has    
ever been required to contribute to or otherwise participate in, any plan,      
program or arrangement subject to Title IV of ERISA.                            

(c) No former employee of the Company or any Company Subsidiary is    
entitled, and no current employee will be entitled after termination of         
employment, to participate in any Employee Welfare Benefit Plan as defined in   
ERISA, other than participation required to be permitted by the Company or any  
Company Subsidiary under Section 4980B of the Code and Sections 601 to 609 of   
ERISA.                                                                          

   (d) The Company and the Shareholder have delivered to Tyler true, correct
and complete copies of the Benefit Plans and each applicable summary plan       
description and the most recent Form 5500s applicable to such Benefit Plans.    
Section 2.26 of the Company Disclosure Schedule sets forth the costs            
attributable to each Benefit Plan determined on an annual basis. Except as      
reflected or reserved against on the Company Balance Sheet, there is no unfunded
liability with respect to any Benefit Plan. None of the assets of any of the    
Company's or any Company Subsidiary's Benefit Plans are invested in any property
constituting employer real property or employer security within the meaning of  
Section 407(d) of ERISA.                                                        

     (e) Each Employee Pension Benefit Plan sponsored, maintained or contributed
to by the Company or any Company Subsidiary is qualified under Section 401(a) of
the Code; all related trusts are exempt from federal income tax under Section   
501(a) of the Code; each such plan has received a determination letter from the 
IRS stating that the plan is qualified under Section 401(a) of the Code and all 
related trusts are exempt from federal income tax under Section 501(a) of the   
Code (which determination letter includes all statutory and regulatory          
provisions of the Tax reform Act of 1986 and subsequent legislation for which a 
determination letter may be obtained); and to the knowledge of the Company,     
nothing has occurred since the date of the last such determination which        
resulted in, or is likely to result in, the revocation of such determination. A 
copy of the latest determination letter applicable to any Employee Pension      
Benefit Plan has been delivered to Tyler.                                       

    (f) Each of the Benefit Plans has been administered in material compliance
with its underlying documentation, the requirements of ERISA, the Code and all  
other applicable laws. All returns required to be made under ERISA and the Code 
with respect to the Benefit Plans have been timely filed and the Company or any 
Company Subsidiary has made all contributions required under the terms of any   
Benefit Plan (including, but in no way limited to, employer matching            
contributions and non-elective contributions and the                            

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deposit of elective deferrals as such terms are defined in the Code) for all    
periods through and including the date hereof.                                  

     (g) To the knowledge of the Company, there are not now, nor have there ever
been, any transactions involving the Benefit Plans or any fiduciary or          
administrator thereof which are prohibited under ERISA or the Code or for which 
an individual, class or statutory exemption is not available.                   

(h) There are no pending or, to the knowledge of the Company, any     
threatened claims by or on behalf of the Benefit Plans, the United States       
Department of Labor, the Internal Revenue Service, or any current or former     
employee of the Company or any Company Subsidiary or beneficiary of such current
or former employee alleging a breach of any fiduciary duties or a violation of  
applicable state or federal law which could result in liability on the part of  
the Company, any Company Subsidiary or a Benefit Plan under ERISA or any other  
law, nor, to the knowledge of the Company, is there any basis for such a claim  
and neither the Company, any Company Subsidiary nor, to the knowledge of the    
Company, any administrator or fiduciary of any Benefit Plan (or agent of the    
foregoing) has engaged in any transaction or acted or failed to act in any      
manner which would subject the Company to any liability for a breach of         
fiduciary duty under ERISA. The transactions contemplated by this Agreement     
(either alone or together with any other event) will not (i) terminate or modify
the provisions of any Benefit Plan or (ii) trigger an event under any Benefit   
Plan or employer benefit arrangement or law that will result in any payment     
(whether of severance pay or otherwise) becoming due from the Company or a      
Company Subsidiary.                                                             

2.27  Labor Relations.                                                

     (a) To the knowledge of the Company or the Shareholder, the Company and the
Company Subsidiaries (i) are in substantial compliance with all applicable laws 
respecting employment and employment practices, terms and conditions of         
employment (including occupational health and safety), nondiscrimination, and   
wages and hours and (ii) are not engaged in any unfair labor practice, that in  
any such case would have a material adverse effect on the businesses,           
operations, assets or financial condition of the Company and the Company        
Subsidiaries, taken as a whole.                                                 

(b) There is no unfair labor practice complaint against Company or any
Company Subsidiary pending or, to the knowledge of the Company or Shareholder,  
threatened before the National Labor Relations Board.                           

(c) There is no strike, labor dispute, slowdown, stoppage, or other   
material interference with or impairment by labor of the business of the Company
and the Company Subsidiaries actually pending or, to the knowledge of the       
Company or the Shareholder, threatened or contemplated against or directly      
affecting the Company or any Company Subsidiary.                                

(d) To the knowledge of the Company or the Shareholder, no question of
union representation exists respecting the employees of the Company or any      
Company Subsidiary and no union organizing activities are taking place.         

 (e) Since July 31, 1997, no key employees of the Company or the Company
Subsidiaries have been terminated or have resigned their employment.            

     2.28  Adequate Insurance. The Company and the Company Subsidiaries maintain
insurance coverage that the Company and the Shareholder believe is reasonably   
adequate to protect the assets and operations of the Company and the Company    
Subsidiaries, taken as a whole, and is sufficient for material compliance with  
all requirements of law and all agreements to which the Company or any Company  
Subsidiary is a party. No notice of any termination or threatened termination of
such policies has been received by the Company or any Company Subsidiary and, to
the knowledge of the Company or the Shareholder, such policies are valid,       
binding, and enforceable.                                                       

   2.29  Contracts with Affiliates and Others. No director or officer of the
Company or any Company Subsidiary, nor any person who is a spouse or descendant 
of such director or officer, has any direct or indirect relationship with any   
customer or supplier of, or other contracting party with, the Company or any    
Company Subsidiary (other than as a director, officer, or shareholder of the    
Company) that would be required to be                                           

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disclosed in a proxy statement relating to the election of directors filed under
the Securities Exchange Act of 1934 (the "Exchange Act").                       

  2.30  Revenue Recognition. The Company and the Company Subsidiaries have
not recognized and do not recognize revenues from customers in advance of       
performing the services or furnishing the products for which the revenues were  
or are received.                                                                

    2.31  Certain Fees. Neither the Company nor any Company Subsidiary nor any
officer, director, or employee of the Company or any Company Subsidiary has     
employed any broker or finder or incurred any liability for any brokerage fees, 
commissions, or finders' fees in connection with the transactions contemplated  
hereby.                                                                         

2.32  Environmental Matters. To the knowledge of the Company or the   
Shareholder:                                                                    

   (a) The Company, the Company Subsidiaries, and their respective
property (whether real, personal, owned, leased, managed or operated) 
 (collectively, "Business Facilities") are in compliance with applicable
   laws, rules, regulations, ordinances, orders or guidance documents now in
effect of any applicable governmental authority or any judicial or    
administrative decision relating thereto that relate in any manner to 
health, Materials of Environmental Concern, the environment, or a     
community's right to know (collectively, "Environmental Laws");       

       (b) There are no Materials of Environmental Concern on any Business
Facility in any quantity or concentration exceeding any limitation or 
standard established pursuant to Environmental Laws;                  

       (c) There are no actual or threatened claims, demands, allegations,
     actions, suits, investigations, notices, or proceedings against or relating
    to the Company or any of its Company Subsidiaries or any of their Business
    Facilities relating to or arising out of the use, presence, or handling of
  Materials of Environmental Concern or compliance with Environmental Laws
    (collectively, "Environmental Claims"), and there is no basis for any such
Environmental Claims; and                                             

          (d) There are no events, conditions, circumstances, facts, activities,
    practices, incidents or plans relating to or arising out of the operations
 of the Company or any of the Company Subsidiaries which will prevent or
interfere with compliance with Environmental Laws by Tyler after the  
  Closing, or which may give rise to any common law or statutory liability
under Environmental Laws or form the basis of an Environmental Claim  
against the Company, any of the Company Subsidiaries, or any of their 
respective Business Facilities.                                       

   "Materials of Environmental Concern" means: (i) those substances included
within the statutory and/or regulatory definitions of "hazardous substance,"    
"hazardous waste," "extremely hazardous substance," "regulated substance,"      
"hazardous materials," or "toxic substances," under any Environmental Law; (ii) 
any material, waste or substance which is or contains: (A) petroleum, oil or a  
fraction or constituent thereof, (B) asbestos, (C) polychlorinated biphenyls,   
(D) formaldehyde, (E) explosives, or (F) radioactive materials (including NORM);
(iii) solid wastes (as defined under the Resource Conservation and Recovery Act,
42 U.S.C. sec.6901 et seq., and its implementing regulations) that post imminent
and substantial endangerment to health or the environment; (iv) any material,   
waste or substance designated classified or regulated as a "Class I" or "Class  
II" waste under Title 30 of the Texas Administrative Code; and (v) such other   
substances, materials, or wastes that are or become classified or regulated as  
hazardous or toxic under any applicable federal, state or local law or          
regulation. To the extent that the laws or regulations of any applicable state  
or local jurisdiction establish a meaning for any term defined herein through   
reference to federal Environmental Laws which is broader than the meaning under 
such federal Environmental Laws, such broader meaning shall apply.              

    2.33  Section 368 Representations. (a) There is no present plan, intention
or arrangement by the Shareholder to sell, exchange, transfer or otherwise      
dispose of, or reduce the risk of loss relating to any of, the shares of Tyler  
Common Stock received by him pursuant to the Merger that would reduce the       
Shareholder's holdings, or risks incident to the ownership, of Tyler Common     
Stock to a number of shares having a total fair market value at the Effective   
Time of less than fifty percent (50%) of the total fair market value of all of  
the                                                                             

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Company's capital stock outstanding immediately prior to the Effective Time. For
purposes of this Section 2.33, shares of the Company's capital stock sold,      
redeemed or otherwise disposed of prior or subsequent to and as a part of the   
overall transaction contemplated by the Merger will be considered to be capital 
stock of the Company outstanding immediately prior to the Merger.               

(b) Neither the Company, Tyler, any Company Subsidiary nor any Tyler  
Subsidiary will assume any debts or obligations of the Shareholder as part of   
the Merger, other than the assumption by Tyler Sub, as the Surviving Corporation
in the Merger, of debts of the Company that are guaranteed by Shareholder.      

   (c) There have not been any sales or redemptions of the Company's capital
stock in contemplation of the Merger. There have been no transactions in the    
capital stock of the Company during the past twelve months other than the grants
by Shareholder of shares of Class B Common Stock described in Section 5.10.     

     (d) The liabilities of the Company assumed by Tyler as a part of the Merger
and the liabilities to which the transferred assets of the Company are subject  
were incurred by the Company in the ordinary course of its business, other than 
the funds borrowed to pay the bonuses to employees and make the distributions to
the Shareholder permitted pursuant to Sections 5.8 and 5.5 of this Agreement.   

(e) The Company will pay the expenses incurred in connection with the 
Merger by it and the Shareholder. Notwithstanding the foregoing, to the extent  
any of the expenses relating to the Merger (or the "plan of reorganization"     
within the meaning of the Department of Treasury Regulation Section 1.368-1(c)  
with respect to the Merger) are funded directly or indirectly by a party other  
than the party incurring such expense, such expenses will be within the         
guidelines established in Revenue Ruling 73-54, 1973-1 C.B. 187.                

 (f) Other than dividends to the Shareholder for purposes of funding his
federal tax liabilities with respect to 1997 income of the Company, the Company 
has not, and pursuant to this Agreement will not, distribute any assets (either 
as a dividend or otherwise) constituting more than 10% of the fair market value 
of all of its assets at any time either during the past twelve months or in     
contemplation of the Merger.                                                    

(g) The Company is not an investment company as defined in Section    
368(a)(2)(F)(iii) and (iv) of the Code.                                         

   (h) The Company is not under the jurisdiction of a court in a Title 11 or
similar case within the meaning of Section 368(a)(3)(A) of the Code.            

  (i) None of the compensation to be received by the Shareholder under the
Employment Agreement (or any other employment, consulting or similar services   
agreement, whether written or oral) will be separate consideration for, or      
allocable to, any of his shares of Company Common Stock. None of the shares of  
Tyler Common Stock to be received by the Shareholder will be separate           
consideration for, or allocable, to the Employment Agreement (or any other      
employment, consulting, or similar services agreement, whether written or oral).

   2.34  Accuracy of Information Furnished. No representation or warranty by
the Company or the Shareholder in this Agreement (including the Company         
Disclosure Schedule) or any other agreement or document executed or to be       
executed by the Company or the Shareholder in connection herewith contains or   
will contain any untrue statement of a material fact or omits or will omit to   
state any material fact necessary to make the statements herein or therein, in  
light of the circumstances under which they were made, not false or misleading. 

2.35  Representations Limited. Notwithstanding anything herein to the 
contrary, representations or warranties with respect to any Company Subsidiary  
with respect to periods prior to the time such Company Subsidiary (or its assets
if acquired as substantially all of the assets of another person) was acquired  
by the Company are made to the knowledge of the Company or the Shareholder.     

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ARTICLE 3 

REPRESENTATIONS AND WARRANTIES OF TYLER 

  Tyler and Sub jointly and severally represent and warrant to the Company
and the Shareholder as follows:                                                 

   3.1  Organization and Good Standing of Tyler. Tyler is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware. Sub is a corporation duly organized, validly existing and in good     
standing under the laws of the State of Texas.                                  

3.2  Foreign Qualification. Tyler is duly qualified or licensed to do 
business as a foreign corporation and in good standing in those jurisdictions   
set forth in Section 3.2 of the schedule delivered by Tyler concurrently with   
the execution of this Agreement (the "Tyler Disclosure Schedule"). Tyler is duly
qualified or licensed to do business as a foreign corporation in every          
jurisdiction where the failure so to qualify would have a material adverse      
effect on the businesses, operations, assets, or financial condition of Tyler   
and the Tyler Subsidiaries (as defined in Section 3.7), taken as a whole. For   
purposes of this Section 3.2, no material adverse affect shall be deemed to have
occurred as a result of non-payment of state or local franchise taxes not       
exceeding $75,000 in the aggregate.                                             

     3.3  Power and Authority to Conduct Business. Each of Tyler and Sub has the
corporate power and authority, and possess all licenses and permits, required by
governmental authorities to own, lease, and operate its properties and assets   
and to carry on its business as currently being conducted, except where the     
failure to possess such license or permit does not and would not have a material
adverse effect on the business, operations, assets or financial condition of    
Tyler and the Tyler Subsidiaries, taken as a whole.                             

3.4  Authority to Consummate Merger. Each of Tyler and Sub has the    
corporate power and authority to execute, deliver and perform its obligations   
under this Agreement and the other agreements or documents executed or required 
to be executed by it in connection with this Agreement and, subject to obtaining
approval of the stockholders of Tyler, the execution, delivery and performance  
by each of Tyler and Sub of this Agreement and the other documents executed or  
to be executed by it in connection with this Agreement have been duly authorized
by all necessary corporate action.                                              

 3.5  Binding Effect. This Agreement and the other documents executed or
required to be executed by Tyler or Sub in connection with this Agreement have  
been or will have been duly executed and delivered by Tyler or Sub and are or   
will be, when executed and delivered, the legal, valid, and binding obligations 
of Tyler or Sub executing the same, enforceable in accordance with their terms  
except that:                                                                    

         (a) enforceability may be limited by bankruptcy, insolvency, or other
similar laws affecting creditors' rights;                             

          (b) the availability of equitable remedies may be limited by equitable
principles of general applicability; and                              

      (c) rights to indemnification under Section 10.6 may be limited by
considerations of public policy.                                      

   3.6  Compliance with Other Instruments. Subject to obtaining the approval
of the stockholders of Tyler and except as disclosed in Section 3.6 of the Tyler
Disclosure Schedule, neither the execution and delivery by Tyler or Sub of this 
Agreement or the other agreements or documents executed or required to be       
executed by Tyler or Sub in connection herewith, nor the consummation by Tyler  
or Sub of the transactions contemplated hereby and thereby will (i) conflict    
with the articles of incorporation or bylaws of Tyler or Sub, (ii) assuming     
satisfaction of the requirements set forth in clause (iii) below, violate any   
provision of law applicable to Tyler or any of the Tyler Subsidiaries; (iii)    
except for (A) requirements arising out of the HSR Act, (B) requirements of     
federal and state securities laws, and (C) the filing of articles of merger in  
accordance with the TBCA, require any consent, authorization, permit, license or
approval of, or declaration, registration or filing with or notice to, any      
person or governmental body or authority, domestic or foreign, under any        
provision of law applicable to Tyler or any of the Tyler Subsidiaries; or (iv)  
require any consent, approval or notice under, violate, breach, be in conflict  
with, or constitute a default (or an event that, with notice or lapse           
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of time or both, would constitute a default) under, or permit the termination or
the acceleration of maturity of, or result in the imposition of any lien, claim,
or encumbrance upon any property or asset of Tyler or any Tyler Subsidiary      
pursuant to any note, bond, indenture, mortgage, deed of trust, evidence of     
indebtedness, loan or lease agreement, other agreement or instrument or any     
judgment, order, injunction, or decree by which Tyler or any Tyler Subsidiary is
bound, to which any of them is a party, or to which any of their assets is      
subject, except for those violations and breaches that would not have a material
adverse effect on the businesses, operations, assets or financial condition of  
Tyler and the Tyler Subsidiaries, taken as a whole.                             

3.7  Capitalization of Tyler.                                         

    (a) The authorized capital stock of Tyler consists of 50,000,000 shares of
Tyler Common Stock, and 1,000,000 shares of preferred stock, par value $10.00   
per share ("Tyler Preferred Stock"), of which 22,007,921 shares of Tyler Common 
Stock and no shares of Tyler Preferred Stock were issued and outstanding as of  
September 30, 1997 and 1,301,356 shares of Common Stock were held in treasury.  
All of the issued and outstanding shares of Tyler Common Stock have been duly   
authorized and are validly issued and are fully paid and nonassessable. There   
are no shares of the capital stock of Tyler held in its treasury or in the      
treasury of any corporation of which Tyler is the record or beneficial owner,   
directly or indirectly, of 50% or more of the capital stock (each such          
corporation being referred to as a "Tyler Subsidiary"). The shares of Tyler     
Common Stock to be issued in the Merger, when issued and delivered, will be duly
authorized, validly issued, fully paid, and nonassessable.                      

    (b) As of the date hereof, the authorized capital stock of Sub consists of
1,000 shares of common stock, par value $0.01 per share, all of which are       
validly issued, fully paid and nonassessable and are owned by Tyler.            

     (c) Except as described in Section 3.7 of the Tyler Disclosure Schedule and
in the Tyler Financial Statements (as hereinafter defined), there is no         
outstanding subscription, contract, convertible or exchangeable security,       
option, warrant, call, or other right obligating Tyler or any Tyler Subsidiary  
to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem, or   
otherwise acquire shares of, or securities convertible into or exchangeable for,
capital stock of Tyler.                                                         

 3.8  Commission Filings; Financial Statements. Section 3.8 of the Tyler
Disclosure Schedule lists all reports, registration statements and other        
filings, together with any amendments required to be made with respect thereto, 
that Tyler has filed with the Securities and Exchange Commission (the           
"Commission")under the Securities Act of 1933, as amended (the "Securities      
Act"), and the Exchange Act since October 1, 1995. All reports, registration    
statements and other filings filed by Tyler with the Commission since October 1,
1995 through the date of this Agreement, together with any amendments thereto,  
are sometimes collectively referred to as the "Tyler Commission Filings." Tyler 
has heretofore provided the Company and the Shareholder true, correct and       
complete copies of the Tyler Commission Filings. As of the respective dates of  
their filing with the Commission, the Tyler Commission Filings complied in all  
material respects with the Securities Act, the Exchange Act and the rules and   
regulations of the Commission promulgated thereunder, and did not contain any   
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements made therein, in light of 
the circumstances under which they were made, not misleading.                   

    Each of the consolidated financial statements (including any related notes
or schedules) included in or incorporated by reference into the Tyler Commission
Filings ("Tyler Financial Statements") was, and each of the consolidated        
financial statements to be included in the Proxy Statement (as defined in       
Section 6.2) (except for those financial statements of the Company and the      
Company Subsidiaries furnished by or on behalf of the Company or the Shareholder
to Tyler specifically for use therein) will be, prepared in accordance with     
generally accepted accounting principles applied on a consistent basis (except  
as may be noted therein or in the notes or schedules thereto), and fairly       
present or will fairly present, as the case may be, the consolidated financial  
position of Tyler and its consolidated subsidiaries as of the dates thereof and 
the results of operations, cash flows and changes in stockholders' equity for   
the periods then ended (subject, in the case of the unaudited interim financial 
statements, to normal year-end audit adjustments). Since December 31, 1996,     
there has been no change in accounting principles applicable to, or methods of  
accounting utilized by, Tyler and the books and records of Tyler and the Tyler  
Subsidiaries have been and are being maintained in                              
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accordance with all applicable legal and accounting requirements and good       
business practice, reflect only valid transactions, are complete and correct in 
all material respects, and accurately reflect in all material respects the basis
for the consolidated financial position and consolidated results of operations  
and cash flows of Tyler and its consolidated subsidiaries set forth in the Tyler
Financial Statements.                                                           

     3.9  Absence of Certain Changes. Since June 30, 1997, Tyler has not (except
as contemplated by this Agreement or as may result from the transactions        
contemplated by this Agreement or as described in the Tyler Disclosure          
Schedule):                                                                      

   (a) suffered any change in its business, results of operations,
    working capital, assets, liabilities, or financial condition or the manner
    of conducting its business other than changes that, individually or in the
aggregate, have not had a material adverse effect on the businesses,  
operations, assets or financial condition of Tyler and the Tyler      
Subsidiaries, taken as a whole;                                       

         (b) entered into any material commitment or transaction other than in
the ordinary course of business;                                      

      (c) written up, written down, or written off the book value of any
material amount of assets;                                            

(d) declared, paid, or set aside for payment any dividend or
distribution with respect to the capital stock of Tyler; or           

       (e) redeemed, purchased, or otherwise acquired, or sold, granted or
    otherwise disposed of, directly or indirectly, any of the capital stock or
securities of Tyler or any rights to acquire such capital stock or    
     securities, other than normal or periodic purchases, sales and grants under
provisions of existing employee benefit plans and programs of Tyler.  

     3.10  No Material Undisclosed Liabilities. To the knowledge of Tyler, there
is no liability or obligation of Tyler and the Tyler Subsidiaries of any nature,
whether absolute, accrued, contingent, or otherwise, other than:                

          (a) the liabilities and obligations that are fully reflected, accrued,
  or reserved against in the unaudited consolidated balance sheet of Tyler
and its consolidated subsidiaries as of June 30, 1997, for which the  
     reserves are appropriate and reasonable, or incurred in the ordinary course
of business and consistent with past practices since June 30, 1997;   

     (b) the loss contingencies set forth in Section 3.10 of the Tyler
Disclosure Schedule;                                                  

          (c) contractual liabilities or obligations of a nature not required to
be disclosed on a balance sheet prepared in accordance with generally 
accepted accounting principles; and                                   

          (d) other liabilities and loss contingencies which are not material in
     the aggregate to the business, operations, assets or financial condition of
Tyler and the Tyler Subsidiaries, taken as a whole.                   

     3.11  Litigation and Government Claims. Except as described in Section 3.11
of the Tyler Disclosure Schedule, neither Tyler nor any Tyler Subsidiary is a   
party to, and the business or assets of Tyler and the Tyler Subsidiaries are not
the subject of, any pending or, to the knowledge of Tyler, threatened suit,     
claim, action, or litigation with any party, or any administrative, arbitration,
or other governmental proceeding, investigation, or inquiry, in which the amount
involved and not covered by insurance exceeds $250,000. In the opinion of Tyler 
and its management, none of such pending or threatened matters would, severally 
or in the aggregate, have a material adverse effect on the business, operations,
assets or financial condition of Tyler and the Tyler Subsidiaries, taken as a   
whole.                                                                          

   3.12  No Violation of Any Instrument. Except as disclosed in Section 3.12
of the Tyler Disclosure Schedule, neither Tyler nor any Tyler Subsidiary is in  
violation of or default under nor, to the knowledge of Tyler, has any event     
occurred that, with the lapse of time or the giving of notice or both, would    
constitute a violation of or default under, or permit the termination or the    
acceleration of maturity of, or result in the imposition of a lien, claim, or   
encumbrance upon any property or asset of Tyler or any Tyler Subsidiary pursuant
to the articles or certificate of incorporation or bylaws of Tyler or any Tyler 
Subsidiary or any note,                                                         
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bond, indenture, mortgage, deed of trust, evidence of indebtedness, loan or     
lease agreement, or other agreement or instrument or any judgment, order,       
injunction, or decree to which it is a party, by which it is bound, or to which 
any of its assets is subject, which would have a material adverse effect on the 
business, operations, assets or financial condition of Tyler and the Tyler      
Subsidiaries, taken as a whole.                                                 

     3.13  Certain Fees. Neither Tyler nor any officer, director, or employee of
Tyler has employed any broker or finder or incurred any liability for any       
brokerage fees, commissions, or finders' fees in connection with the            
transactions contemplated hereby.                                               

   3.14  No Interim Operations of Sub. Sub was formed solely for the purpose
of engaging in the transactions contemplated hereby, has engaged in no other    
business activities and has conducted its operations only as contemplated       
hereby.                                                                         

   3.15  Accuracy of Information Furnished. No representation or warranty by
Tyler or Sub in this Agreement (including the Tyler Disclosure Schedule) or any 
other agreement or document executed or to be executed by Tyler or Sub in       
connection herewith contains or will contain any untrue statement of a material 
fact or omits or will omit to state any material fact necessary to make the     
statements herein or therein, in light of the circumstances under which they    
were made, not false or misleading.                                             

3.16  Company Contract Bids. Tyler acknowledges that, notwithstanding 
Section 2.21, certain of the Company's contracts with governments or            
governmental agencies may come up for bid in the ordinary course of business    
(including Dallas County, Texas in late 1997) and that no guarantee can be made 
that the Company will be the successful bidder for such contracts.              

ARTICLE 4 

JOINT COVENANTS OF THE COMPANY, THE SHAREHOLDER AND TYLER 

4.1  Access; Confidentiality.                                         

(a) During the period pending the Closing Date, the Company and the   
Shareholder (with respect only to the properties to be leased by the Shareholder
to the Company after the Merger) shall afford to Tyler and its officers,        
employees, accountants, counsel, and other authorized representatives, full     
access to and the right to review and make copies of the Company's, the Company 
Subsidiaries', the Company Investments' (to the extent practicable), and the    
Shareholder's assets, properties, books, contracts, commitments, and records,   
view their physical properties, and communicate with the key employees of the   
Company and the Company Subsidiaries on a basis reasonably satisfactory to and  
with the prior specific approval of the Shareholder, and will furnish and use   
their reasonable best efforts to cause representatives to furnish promptly to   
Tyler such additional financial and operating data and other documents and      
information (certified if requested and reasonably susceptible to certification)
relating to the Company, the Company Subsidiaries', the Company Investments' (to
the extent practicable), and the Shareholder's businesses and properties as     
Tyler or its duly authorized representatives may from time to time reasonably   
request.                                                                        

   (b) During the period pending the Closing Date, Tyler shall afford to the
Company and the Shareholder and their accountants, counsel and other authorized 
representatives the same rights of access to and inspection of the books,       
records, properties, contracts and personnel of Tyler as those afforded to Tyler
and its representatives in Section 4.1(a) above.                                

  (c) Notwithstanding any such investigation by Tyler, the Company, or the
Shareholder, or any information obtained pursuant thereto, it or he shall be    
entitled to rely in full upon the accuracy of the representations and warranties
of the other party or parties contained in this Agreement and upon its or his   
representations at Closing as to compliance with or performance of any covenants
made by it or him in this Agreement. Tyler, the Company, or the Shareholder     
shall have no obligation to investigate any such matters and, if any such       
matters are investigated, shall have no obligation to the other party or parties
with respect to information obtained thereby except as provided in Section 12.1 
of this Agreement.                                                              

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  (d) The rights and obligations of the Shareholder, the Company and Tyler
pursuant to the Confidentiality Agreement (the "Confidentiality Agreement")     
dated September 24, 1997 by and among the Shareholder, the Company and Tyler    
will survive the execution and delivery of this Agreement, and all information  
obtained by the Shareholder, the Company and Tyler or any of their respective   
Representatives (as defined in the Confidentiality Agreement) pursuant hereto   
shall be deemed "Information" as that term is defined in the Confidentiality    
Agreement, and shall be subject to the provisions of the Confidentiality        
Agreement, except to the extent that Tyler is advised by counsel that disclosure
of any such Information, including the existence of the Confidentiality         
Agreement, is required by law in connection with the Merger.                    

  4.2  Notice of any Material Change. Each of the Company and Tyler shall,
promptly after the first notice or occurrence or failure to occur thereof but   
not later than the Closing Date, supplement or amend its Disclosure Schedule to 
disclose the occurrence of any event or the existence of any state of facts that
would:                                                                          

        (a) make any of its representations and warranties in this Agreement
 untrue in any material respect or constitute a material failure of such
    party to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder;                           

         (b) make it necessary to amend the Proxy Statement in order to render
    the statements therein not misleading or to comply with applicable law; or

        (c) otherwise constitute a material adverse change in the respective
    businesses, results of operations, working capital, assets, liabilities or
 condition (financial or otherwise) of Tyler and the Tyler Subsidiaries,
   taken as a whole, or the Company and the Company Subsidiaries, taken as a
whole. Subject to the provisions of Section 12.1 of this Agreement, no
  supplement or amendment to any Disclosure Schedule shall have any effect
   for the purpose of determining the satisfaction of or compliance with the
  conditions to the obligations of the parties set forth elsewhere in this
Agreement.                                                            

  4.3  Monthly Financial Statements. During the period pending the Closing
Date, each of Tyler and the Company shall furnish to the other its unaudited    
consolidated balance sheet and related statements of operations, stockholders'  
equity, and cash flows and any supporting schedules for the accounting periods  
ending on or about the last day of each such month, promptly after they are     
available, but not later than 30 days after the close of such accounting period.

  4.4  Antitrust Notification. Within 10 days after the date hereof, Tyler
and the Shareholder shall each file with the Federal Trade Commission ("FTC")   
and the Antitrust Division of the U.S. Department of Justice ("DOJ") the        
Notification and Report Form required to be filed pursuant to the HSR Act, and  
shall timely supply any supplemental information that may be reasonably         
requested by the FTC or DOJ in connection therewith. The Company, the           
Shareholder and Tyler shall furnish to each other such necessary information and
reasonable assistance as the other party may request in connection with the     
preparation of its respective necessary submissions under the HSR Act. The      
Company, the Shareholder and Tyler shall furnish to each other copies of all    
correspondence, filings, or communications (or memoranda setting forth the      
substance thereof), between them or their representatives and the FTC or DOJ.   

4.5  Tax Matters.                                                     

   (a) The Shareholder and the Company shall prepare and timely file all tax
returns and amendments thereto required to be filed by the Company and the      
Company Subsidiaries on or before the Closing Date and all federal income tax   
returns of the Company and the Company Subsidiaries that are due to be filed    
after the Closing Date and relate to the tax periods of the Company and the     
Company Subsidiaries ending on or before the Closing Date. Tyler shall have a   
reasonable opportunity to review all such tax returns and amendments thereto.   
The Company and the Company Subsidiaries, with the consent of the Shareholder,  
shall be entitled in their discretion at any time prior to the Closing Date to  
revoke their elections under Section 1362(a) of the Code to be treated as S     
corporations.                                                                   

   (b) Tyler or the Surviving Corporation, as appropriate, shall prepare and
file all tax returns other than federal income tax returns of the Company and   
the Company Subsidiaries that are due to be filed after the Closing Date and    
shall pay all taxes shown on such returns as due and owing.                     

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    (c) The Shareholder covenants and agrees that he will be fully responsible
for, and indemnifies and holds harmless Tyler, the Company and the Company      
Subsidiaries from and against, any and all claims, demands, losses, obligations 
and liabilities for income taxes of the Company and the Company Subsidiaries,   
any penalties and interest with respect thereto, and any costs and expenses     
(including reasonable attorneys' and accountants' fees) of Tyler, the Company or
a Company Subsidiary incurred as an incident thereto, relating to tax periods of
the Company and the Company Subsidiaries ending on or before the Closing Date.  
Tyler agrees that the Shareholder shall have the sole right to contest, resolve 
and defend, at his cost, against any assessment for additional income taxes,    
notice of income tax deficiency or other adjustment of income taxes of the      
Company or the Company Subsidiaries made or proposed by any taxing authority for
such periods. The Shareholder shall be entitled to retain such tax              
representatives, subject to the consent of Tyler (which shall not be            
unreasonably withheld), as he selects to represent him in resolving any such    
income tax controversies or disputes for tax periods ending on or before the    
Closing Date, and Tyler or the Company, as appropriate, shall execute and       
deliver powers of attorney, limited to such tax periods, in favor of the        
Shareholder or his tax representatives as necessary to effectuate the provisions
of this Section 4.5.                                                            

   (d) Subject to Closing, and specifically reserving any rights or remedies
Tyler or the Surviving Corporation may have for breach of the representations   
and warranties of the Shareholder contained in Article 2 of this Agreement,     
Tyler covenants and agrees that either it or the Surviving Corporation, as      
appropriate, will be fully responsible for, and Tyler indemnifies and holds     
harmless the Shareholder from and against, any and all claims, demands, losses, 
obligations and liabilities for income taxes of the Surviving Corporation and   
the Company Subsidiaries, any penalties and interest with respect thereto, and  
any costs and expenses (including reasonable attorneys' and accountants' fees)  
of the Shareholder incurred as an incident thereto, relating to tax periods of  
the Surviving Corporation and the Company Subsidiaries ending after the Closing 
Date; such responsibility of and indemnity by Tyler shall include the amounts of
any and all tax consequences or liabilities attributable to any election by     
Tyler or the Surviving Corporation after the Closing to change the tax          
accounting methods utilized by the Company or the Company Subsidiaries          
applicable to tax periods ending after the Closing Date. The Shareholder agrees 
that Tyler or the Surviving Corporation, as appropriate, shall have the sole    
right to contest, resolve and defend, at its cost, against any assessment for   
additional income taxes, notice of income tax deficiency or other adjustments of
income taxes of the Surviving Corporation or the Company Subsidiaries made or   
proposed by any taxing authority for tax periods ending after the Closing Date. 

    (e) All parties hereto agree if requested to reasonably cooperate with one
another and assist in the settlement, compromise, defense or other disposition  
of any assessments for additional taxes, notices of deficiency, proposed        
adjustments or other income tax disputes or controversies by or with taxing     
authorities relating to the Company and the Company Subsidiaries. Tyler or the  
Surviving Corporation, as appropriate, will provide to the Shareholder or his   
tax representatives prompt written notification and copies of any communications
from or to any taxing authority received or made by either of them relating to  
income tax liabilities of the Company or the Company Subsidiaries for any tax   
periods ended on or before the Closing Date. The Shareholder or his tax         
representatives will provide to Tyler prompt written notification and copies of 
any communications from or to any taxing authority received or made by either of
them relating to income tax liabilities of the Company or the Company           
Subsidiaries. Subsequent to any such notice, Tyler and the Shareholder shall    
keep the other fully advised of the status and developments with respect to such
proposed or asserted income tax liability, and of the terms of any settlement or
other final resolution thereof. Failure by any party to notify any other party, 
as provided herein, shall not relieve the party otherwise entitled to such      
notice from its obligations contained in this Section 4.5 of this Agreement;    
provided, however, that the party entitled to such notice may pursue other      
remedies available to it at law or in equity for breach, if any, of the covenant
to notify contained herein.                                                     

(f) The Shareholder shall not, in any capacity, agree to any audit    
adjustments by a taxing authority, or settle, compromise or otherwise agree to a
resolution of any dispute or controversy, with respect to the income tax        
liability of the Company or the Company Subsidiaries if the effect of the       
adjustment or the terms of the                                                  

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settlement increases the income tax liabilities (including loss of carry        
forwards) of the Company and the Company Subsidiaries:                          

          (i) for the taxable period commencing on January 1, 1997 and ending on
     the Closing Date to an amount that, when added to the income taxes paid for
     such period by Tyler or the Company in accordance with Section 4.5(b) above
    (excluding the amount of any such income tax liability attributable to any
     election by Tyler or the Company after the Closing to change tax accounting
    methods utilized by the Company and the Company Subsidiaries applicable to
   tax periods ending on or after January 1, 1997) exceeds the tax liability
    (excluding deferred taxes) accrued on the books and records of the Company
    and the Company Subsidiaries for the period commencing January 1, 1997 and
ending on the Closing Date; or                                        

   (ii) for taxable periods commencing after the Closing Date (but
   including the amount of any such income tax liability attributable to any
     election by Tyler or the Company after the Closing to change tax accounting
    methods utilized by the Company and the Company Subsidiaries applicable to
    tax periods ending on or after January 1, 1997), unless the Shareholder or
    his tax representatives shall have in advance thereof consulted with Tyler
   and shall have agreed on mutually acceptable terms to pay to Tyler or the
     Surviving Corporation, as appropriate, the additional income taxes (subject
    to the limitation set forth in Subsection (i) above) that would be owed by
   Tyler or the Company for all periods subsequent to December 31, 1996 as a
     result of such settlement. In any event, the Shareholder shall pay to Tyler
     or the Surviving Corporation, as appropriate, the amount of any increase in
  income tax liabilities (including loss of carry forwards) of the Company
 and the Company Subsidiaries for all tax periods ending on or after the
    Closing Date (subject to the limitation set forth in subsection (i) above)
that results from a final administrative or judicial determination    
adjusting the income tax liabilities of the Company and the Company   
    Subsidiaries for any period ending on or before the Closing Date, and such
payment or payments shall be made at the time Tyler or the Surviving  
   Corporation files an income tax return with a taxing authority covering a
tax period that is affected by such increase in income tax liability. 

  (g) Tyler or the Surviving Corporation, as appropriate, shall pay to the
Shareholder the amount of any reduction in income tax liabilities of the Company
and the Company Subsidiaries for all tax periods ending on or after the Closing 
Date that result from a corresponding adverse adjustment by a taxing authority  
to the tax liability of the Company and the Company Subsidiaries for tax periods
ended on or before the Closing Date. Any such payment or payments shall be made 
at the time Tyler or the Company files an income tax return with the taxing     
authority covering a tax period that is benefitted by such reduction.           

   (h) The Shareholder agrees promptly to pay over to Tyler or the Surviving
Corporation, as appropriate, at the time of receipt by the Shareholder, all     
proceeds he receives from any refund of income taxes arising out of any carry   
back to prior tax periods of the Company and the Company Subsidiaries of any net
operating loss of Sub for tax periods ending on or after the Closing Date,      
including any benefits derived from such carry backs to otherwise reduce an     
income tax liability for such prior periods. At the request of Tyler or Sub and 
at their expense, the Shareholder shall promptly file all necessary documents or
prosecute all other necessary proceedings to claim and recover such refunds.    
Tyler or Sub, as appropriate, at the time of the receipt thereof, agree to      
timely pay over to Shareholder all proceeds received by either of them from any 
refund of income taxes as a result of an adjustment to the income tax liability 
of the Company or any Company Subsidiary for tax periods ending on or before the
Closing Date. At the request of Shareholder and at his expense, Tyler or Sub, as
appropriate, shall promptly file all necessary documents or prosecute all other 
necessary proceedings to claim and recover such refunds.                        

(i) At the request of the Shareholder, Tyler or the Company, as       
appropriate, shall submit for filing with the Internal Revenue Service a Request
for Prompt Assessment of Income Taxes pursuant to Section 6501(d) of the        
Internal Revenue Code for all open tax periods through the Closing Date for     
which a federal income tax return or returns or amended return or returns have  
been filed by the Company and the Company Subsidiaries.                         

  (j) From and after the Closing Date, the Shareholder will not (a) extend
the statute of limitations; (b) make or change any elections affecting the      
Company or the Company Subsidiaries; or (c) change a method of accounting, in   
each instance with respect to tax liabilities of the Company Subsidiaries       
relating to                                                                     
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periods ending on or prior to the Closing Date, without the prior written       
consent of Tyler (which consent shall not be unreasonably withheld).            

    (k) To the extent the provisions of this Section 4.5 and the provisions of
Article 11 of this Agreement are inconsistent or conflict, the provisions of    
this Section 4.5 shall be determinative of the rights and obligations of the    
parties hereto.                                                                 

(l) Except as required by applicable law, the Shareholder, Tyler, the 
Company and the Company Subsidiaries will not take or cause to be taken any     
action which would prevent the transactions contemplated hereby from qualifying 
as a reorganization under Section 368 of the Code.                              

    4.6  Cooperation Pending Closing. Each of the parties hereto shall use its
reasonable best efforts to:                                                     

    (a) proceed promptly to make or give the necessary applications,
notices, requests, and filings in an effort to obtain at the earliest 
     practicable date and, in any event, before the Closing Date, the approvals,
   authorizations, and consents of third parties necessary to consummate the
transactions contemplated by this Agreement;                          

          (b) cooperate with and keep the other informed in connection with this
Agreement; and                                                        

      (c) take such actions as the other party may reasonably request to
consummate the transactions contemplated by this Agreement and use its
  reasonable best efforts and diligently attempt to satisfy, to the extent
  within its control, all conditions precedent to the obligations to close
this Agreement.                                                       

     4.7  Non-competition Allocation. Each of the parties agree that $100,000 of
the cash portion of the Consideration to be received by Shareholder as the      
holder of Class A Common Stock is in consideration of, and shall be allocated   
to, the non-competition and non-solicitation covenants of the Shareholder in the
Employment Agreement (as defined herein).                                       

ARTICLE 5 

COVENANTS OF THE COMPANY AND THE SHAREHOLDER

   5.1  Conduct of Business Prior to Closing Date. During the period pending
the Closing Date (or other indicated date), the Company and the Shareholder:    

  (a) shall, and shall cause each Company Subsidiary to, use its
  reasonable best efforts to conduct the operations of the Company and the
Company Subsidiaries in the ordinary and usual course of business     
consistent with past and current practices, and to maintain marketing 
organizations intact and to preserve the goodwill of their employees, 
representatives, suppliers, and customers;                            

(b) shall confer upon request of Tyler with one or more     
 representatives of Tyler to report material operational matters and the
general status of ongoing operations;                                 

         (c) shall notify Tyler of any emergency or other change in the normal
    course of the Company's or the Company Subsidiaries' businesses and of any
   governmental complaints, investigations, or hearings that are pending (or
that the same may be contemplated) if such emergency, complaint,      
    investigation, or hearing would be material to the Company's businesses or
properties and those of the Company Subsidiaries, taken as a whole;   

       (d) shall take no action that, and shall not fail to use reasonable
     best efforts to take (without material cost) any action the failure to take
     which, would cause or permit their representations and warranties contained
     in this Agreement to be untrue in any material respect on the Closing Date;
and                                                                   

       (e) except as may be permitted or required by this Agreement, shall
not directly or indirectly do any of the following: (i) issue, sell,  
    pledge, dispose of or encumber, or permit any Company Subsidiary to issue,
    sell, pledge, dispose of or encumber, (A) any capital stock of the Company
or any Company Subsidiary or (B) other than in the ordinary course of 
  business and consistent with past practice, any assets of the Company or
any Company Subsidiary; (ii) amend or propose to amend the respective 

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   charters or bylaws of the Company or any Company Subsidiary; (iii) split,
     combine or reclassify any outstanding capital stock, or, except as provided
in Section 5.5 hereof, declare, set aside or pay any dividend or      
    distribution payable in cash, stock, property or otherwise with respect to
its capital stock whether now or hereafter outstanding; (iv) redeem,  
purchase or acquire or offer to acquire, or permit any of the Company 
     Subsidiaries to redeem, purchase or acquire or offer to acquire, any of the
    Company's or any Company Subsidiary's capital stock; or (v) enter into any
   contract, agreement, commitment or arrangement with respect to any of the
matters set forth in this Section 5.1(e).                             

     5.2  Employment Agreement. At or before the Closing the Shareholder and the
Company shall execute and deliver an Employment and Noncompetition Agreement in 
substantially the form of Exhibit A hereto, with such changes therein prior to  
execution as may be mutually approved by Tyler and the Shareholder (the         
"Employment Agreement"), and providing for the employment of the Shareholder by 
the Surviving Corporation after the Closing, covenants by the Shareholder not to
compete with the Surviving Corporation, and compensation, all as provided       
therein.                                                                        

  5.3  Noncompetition Agreements. The Company and the Shareholder agree to
use their reasonable best efforts to cause the employees and consultants of the 
Company and the Company Subsidiaries identified in Section 5.3 of the Tyler     
Disclosure Schedule to terminate their current employment and consulting        
agreements and, in the case of the employees, to execute and deliver employment 
agreements with the Company acceptable to Tyler (the "Noncompetition            
Agreements").                                                                   

5.4  Agreement Not to Negotiate. Pending the Closing, and through the 
period ending March 31, 1998 if this Agreement is terminated without closing by 
the Company or the Shareholder, the Company and the Shareholder shall not,      
either directly or indirectly through an agent, representative or other person, 
solicit or authorize any person to solicit, or initiate or encourage, directly  
or indirectly, any proposal for the acquisition of all or any material part of  
the capital stock, assets, or business of the Company or any of the Company     
Subsidiaries, or for the merger, consolidation, or other combination of the     
Company or any of the Company Subsidiaries with any other person or entity, or  
enter into any discussions or negotiations for any such proposal, or provide any
person with information or assistance in furtherance of any such proposal, and  
shall promptly notify Tyler in writing of all proposals received with respect to
such matters.                                                                   

    5.5  Permitted Distributions of Cash and Condo. After June 30, 1997 and on
or before the Closing Date the Company shall be entitled to distribute to the   
Shareholder aggregate cash dividends or other cash distributions not exceeding  
$3,300,000. On or before the Closing Date, the Shareholder will cause the       
Company or the appropriate Company Subsidiary to convey, transfer and assign to 
the Shareholder or such other party as he determines, the record title to, and  
all other rights of ownership of the Company or the Company Subsidiaries in Unit
900, Bridgeport Condominiums, 344 Padre Boulevard, South Padre Island, Texas    
(the "Condo"), subject to any indebtedness incurred in connection with the      
Condo, and shall obtain and provide to Tyler an absolute and unconditional      
release, executed by the holders of any indebtedness, notes, mortgages, pledges,
security agreements or other similar obligations incurred in connection with the
Condo, releasing the Company and the Company Subsidiaries from any liability    
with respect to any such obligations, whether as maker, endorser, surety,       
obligor, guarantor or otherwise, or shall provide to Tyler the Shareholder's    
agreement to indemnify Tyler, the Surviving Corporation and the Company         
Subsidiaries against any such liability, which indemnification agreement shall  
be reasonably acceptable to Tyler.                                              

5.6  Waiver of Adverse Claims. The Shareholder releases, waives and   
disclaims any ownership interest, right, title or other claim to any of the     
assets, other than the Condo and the real property which is subject to the      
Lease, which are or during the twelve months preceding the Closing Date have    
been utilized by the Company or the Company Subsidiaries in the conduct of their
respective businesses.                                                          

 5.7  Accuracy of Information Furnished. The information supplied by the
Shareholder to Tyler in writing expressly for inclusion in any documents        
(including the Proxy Statement) filed with the Commission in connection with or 
as a result of the transactions contemplated hereby, will, at the respective    
times such documents are filed with the Commission, not contain any untrue      
statement of a material fact or omit to state any material fact necessary to    
make the statements therein, in light of the circumstances under which they were
made, not false or misleading.                                                  
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5.8  Pre-Closing Bonuses. Prior to the Closing, the Company shall be  
entitled to pay bonuses to employees of the Company for past services rendered  
and to pay the consultant identified in Schedule 2.8 of the Company Disclosure  
Schedule in connection with termination of his consulting arrangement, which    
bonuses and payment shall not exceed an aggregate of $2,400,000.                

  5.9  New Indebtedness. The Company shall be entitled to incur additional
indebtedness to the extent necessary to make the cash distributions contemplated
by Section 5.5 or pay the bonuses contemplated by Section 5.8.                  

    5.10  Stock Grants. Prior to the Closing, the Shareholder will transfer an
aggregate of 12,350 shares of the Class B Common Stock of the Company (the "Key 
Employee Stock Grants") to key employees of the Company and the Company         
Subsidiaries ("Key Employees") selected by the Shareholder, without any sales or
purchase price being paid therefor. The terms of the Key Employee Stock Grants  
and any applicable restrictions on transfer of the shares so granted and        
transferred shall be as set forth in the form of Stock Transfer Agreement       
attached as Exhibit C hereto.                                                   

   5.11  Transfer of Headquarters Facilities. Concurrently with the Closing,
the Shareholder shall transfer to Sub, by special warranty deed, good and       
marketable title, free and clear of any lien, claim or encumbrance other than   
those described in section 2.16(c) hereof, to all the real property facilities  
and fixtures (the "Headquarters Facilities") leased by Government Records       
Services, Inc. pursuant to that certain Lease Agreement dated July 1, 1995      
between the Shareholder and Government Records Services, Inc. (the "Lease") and 
as amended effective January 1, 1996. In connection therewith, Shareholder shall
obtain and provide to Tyler an absolute and unconditional release, executed by  
First National Bank of Grapevine, of all mortgages, liens, deeds of trust or    
other security interests in or to the Headquarters Facilities. The parties      
acknowledge and agree that $5,500,000 of the cash portion of the Consideration  
is allocable to the Headquarters Facilities for federal income tax purposes.    

ARTICLE 6 

COVENANTS OF TYLER

     Tyler covenants and agrees with the Company and the Shareholder as follows:

6.1  Conduct Prior to Closing Date. Pending the Closing, Tyler shall: 

(a) confer upon request of the Shareholder with one or more 
   representatives of the Shareholder to report material operational matters
and the general status of ongoing operations of Tyler and the Tyler   
Subsidiaries; and                                                     

      (b) take no action that, and shall not fail to use reasonable best
efforts to take (without material cost) any action the failure to take
   which, would cause or permit its representations and warranties contained
in this Agreement to be untrue in any material respect at the Closing.

 6.2  Proxy Statement. As promptly as practicable after the execution of
this Agreement, Tyler shall prepare and file with the Commission a proxy        
statement (the "Proxy Statement") pursuant to the Exchange Act. Subject to the  
fiduciary obligations of the Board of Directors of Tyler under applicable law,  
the Proxy Statement shall contain the recommendation of the Board of Directors  
of Tyler that the stockholders of Tyler vote to approve the Merger and this     
Agreement.                                                                      

6.3  Meetings of Stockholders. Tyler shall promptly take all action   
reasonably necessary in accordance with the Delaware General Corporation Law,   
the rules of the NYSE and its articles of incorporation and bylaws to convene a 
meeting of its stockholders to consider and vote upon the adoption and approval 
of the Merger and this Agreement (the "Tyler Stockholders Meeting"). Subject to 
its fiduciary obligations under applicable law and in accordance with the       
provisions of this Agreement, the Board of Directors of Tyler (i) shall         
recommend at such meeting that the stockholders of Tyler vote to adopt and      
approve the Merger and this Agreement; (ii) shall use its reasonable efforts to 
solicit from stockholders of Tyler proxies in favor of                          

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such adoption and approval; and (iii) shall take all other action reasonably    
necessary to secure a vote of its stockholders in favor of the adoption and     
approval of the Merger and this Agreement.                                      

     6.4  Stock Exchange Listing. Tyler shall use its reasonable best efforts to
cause the shares of Tyler Common Stock to be issued upon consummation of the    
Merger to be approved for listing on the NYSE, subject to official notice of    
issuance, prior to the Closing Date.                                            

6.5  Guaranties of Company Obligations.                               

(a) From and after the Closing, Tyler guarantees to the Shareholder,  
respectively, and his heirs, successors and assigns, the full and prompt payment
by the Company of all amounts that become due and payable to them under or      
pursuant to the terms of the Employment Agreement, to be entered into between   
the Company and the Shareholder as provided in Section 5.2 of this Agreement,   
and the timely performance by the Company of all of the terms, conditions,      
covenants and agreements to be performed by the Company under or pursuant to the
terms of said Employment Agreement.                                             

  (b) Payments by Tyler pursuant to Subsection (a) shall be reduced by any
amounts that either Tyler, the Company or a Company Subsidiary may be entitled  
to offset pursuant to the provisions of Section 11.8 of this Agreement and any  
comparable provisions contained in the Employment Agreement. The obligation of  
Tyler to make any payments or render performance under this guaranty shall be   
coextensive with the obligation of the Company or the Company Subsidiary to make
payment or render performance under the Employment Agreement, and Tyler shall be
entitled to assert as a defense to or excuse for or delay in any payment or     
performance by it the same defenses or excuses for payment or performance as    
would be available to the Company or such Company Subsidiary. Subject to the    
foregoing, the guaranty by Tyler contained herein is absolute and unconditional.

  (c) Tyler waives notice of acceptance of this agreement of guaranty, and
waives diligence or presentment on the part of the Shareholder in the           
enforcement of any liability, obligation or duty guaranteed hereby.             

    (d) Tyler agrees that the validity of this agreement of guaranty shall not
in any way be terminated, affected or impaired by reason of any waiver of or    
failure to enforce any of the rights or remedies of the Shareholder contained in
the Employment Agreement, or by reason of any extension of time or other        
forbearance granted to the Company or a Company Subsidiary by the Shareholder.  

   (e) Tyler agrees that, at the option of the Shareholder, it may be joined
in any action or proceedings commenced against the Company or a Company         
Subsidiary in connection with and based upon any provisions of the Employment   
Agreement, and that recovery may be had against Tyler in such action or         
proceedings, or in any independent action or proceedings against Tyler, without 
requirement that the Shareholder or his successors or assigns, first assert,    
prosecute, or exhaust any remedy or claim against the Company or the Company    
Subsidiary.                                                                     

    (f) In the event of any bankruptcy, reorganization, winding up, or similar
proceedings with respect to the Company or a Company Subsidiary, no limitation  
on its liability under the Employment Agreement which may now or hereafter be   
imposed or permitted by any federal, state, or other statute, law regulation, or
judicial or administrative determination applicable to such proceedings, shall  
in any way limit Tyler's obligations hereunder.                                 

6.6  Other Tyler Obligations. At the Closing, if not theretofore      
accomplished, Tyler will cause the Company to execute and deliver to the        
Shareholder the Employment Agreement, against execution and delivery by the     
Shareholder.                                                                    

6.7  Company Indemnification Obligations.                             

(a) Tyler and Sub agree that all rights to indemnification existing in
favor of the present or former directors, officers, employees, fiduciaries and  
agents of the Company or any Company Subsidiary (collectively, the "D&O         
Indemnified Parties") as provided in the Company's or any Company Subsidiary's  
Articles of Incorporation, Bylaws, or other organizational documents as in      
effect as of the date hereof, shall survive the Merger and shall continue in    
full force and effect for six years after the Effective Time (without           
modification                                                                    

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or amendment, except as required by applicable law), to the fullest extent      
permitted by law, and shall be enforceable by the D&O Indemnified Parties       
against the Surviving Corporation or applicable Company Subsidiary; provided    
that in any event Tyler and the Surviving Corporation shall pay and reimburse   
expenses in advance of the final disposition of any action or proceeding to each
D&O Indemnified Party to the fullest extent permitted by law.                   

  (b) The provisions of this Section 6.7 shall survive the consummation of
the Merger and expressly are intended to benefit each of the D&O Indemnified    
Parties. Each of the D&O Indemnified Parties shall be entitled to enforce the   
covenants contained herein.                                                     

    (c) If the Surviving Corporation, applicable Company Subsidiary, or any of
their respective successors or assigns (i) reorganizes, amalgamates or          
consolidates with or merges into any other person and is not the resulting,     
continuing or surviving corporation or entity of such reorganization,           
amalgamation, consolidation or merger, or (ii) liquidates, dissolves or         
transfers all or substantially all of its properties and assets to any person or
persons, then, and in such case, proper provision will be made so that the      
successors or assigns of the Surviving Corporation assume all of the obligations
of the Surviving Corporation set forth in this Section 6.7.                     

 6.8  Agreements Regarding Stock Options. Effective on the Closing Date,
Tyler agrees to grant options, conditioned on the consummation of the           
transactions contemplated hereby and Tyler stockholder approval of any required 
increase in the number of shares of Tyler Common Stock which may be issued      
pursuant to the Tyler Stock Option Plan, to purchase an aggregate of 400,000    
shares of Tyler Common Stock to employees of the Company and the Company        
Subsidiaries designated by the Shareholder. The selection by the Shareholder of 
such employees and the number of option shares to be granted to each shall be   
subject to the reasonable approval of Tyler. The exercise price of the options  
shall be equal to the reported closing price of the Tyler Common Stock on the   
New York Stock Exchange on the Closing Date. The options shall have a term of 10
years from the Closing Date and shall vest on each of the first five anniversary
dates at the rate of 20% of the original number of option shares granted. The   
options shall be incentive stock options pursuant to the Tyler Stock Option     
Plan, as amended, shall contain such other terms as are customary for options   
granted under that plan, and shall be evidenced by option agreements            
incorporating all of such terms.                                                

   6.9  Release of Shareholder Guaranties. At or prior to the Closing, Tyler
shall obtain and provide to the Shareholder an absolute and unconditional       
release, executed by the holders of the indebtedness of the Company and the     
Company Subsidiaries identified in Section 2.21 of the Company Disclosure       
Schedule as guaranteed by the Shareholder and by the surety companies that      
issued the performance bonds identified in such Section 2.21, from any liability
with respect to such indebtedness or performance bonds, whether as maker,       
endorser, surety, obligor, guarantor or otherwise, or shall provide to the      
Shareholder the agreement of Tyler to indemnify Shareholder against any such    
liability, which indemnification agreement shall be reasonably acceptable to    
Shareholder. If the Shareholder shall have personally guaranteed or become      
obligated with respect to any indebtedness of the Company permitted by Section  
5.9 to be incurred to fund cash bonuses and distributions, Tyler also shall     
obtain and provide to the Shareholder an absolute and unconditional release from
any liability with respect to such indebtedness of the Company, executed by the 
holders of such indebtedness.                                                   

    6.10  Tyler Loan. At the request of the Company, on or before December 30,
1997, Tyler will lend to the Company up to $5,700,000 for working capital       
purposes, and advance the requisite funds to the Company for such purposes. In  
such event, the Company will evidence such advances and indebtedness by         
executing and delivering to Tyler a promissory note providing for quarterly     
payments of accrued interest at an annual rate of 8.5% with principal to be paid
in a single installment at maturity, and other commercially reasonable terms.   
Such note will mature on September 30, 1999 or, if earlier:                     

         (i) 90 days after termination of this Agreement, if this Agreement is
rightfully terminated by Tyler because of the failure of a condition  
    precedent to its obligations set forth in Section 9.1, 9.2, 9.4, 9.9, 9.11
or 9.12;                                                              

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         (ii) 18 months after termination of this Agreement, if this Agreement
is rightfully terminated by the Company or Shareholder because of the 
  failure of a condition precedent to its obligations set forth in Section
8.1, 8.2, 8.3 or 8.5; and                                             

         (iii) one year after termination of this Agreement, if this Agreement
   is rightfully terminated by Tyler, the Company or the Shareholder for any
other reason not specified in clauses (i) or (ii) above.              

Loans by Tyler to the Company pursuant to this Section 6.10 shall be in         
replacement of the indebtedness that the Company is permitted to incur and have 
outstanding at the Closing, and which Tyler or Sub thereby would have assumed as
a result of the Merger. The borrowings the Company is permitted to incur        
pursuant to Section 5.9 shall be reduced by the amount of its borrowings from   
Tyler pursuant to this Section 6.10.                                            

ARTICLE 7 

JOINT CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS 

    Except as may be waived by both Tyler and the Shareholder, the obligations
of the Company, the Shareholder, Tyler and Sub to consummate the transactions   
contemplated by this Agreement shall be subject to the satisfaction, on or      
before the Closing Date, of each of the following conditions:                   

    7.1  HSR Act. All filings required under the HSR Act shall have been made,
and all waiting periods, including any extension thereof, that may be applicable
to the transactions contemplated by this Agreement under the provisions of the  
HSR Act shall have expired or been waived or otherwise terminated.              

    7.2  Absence of Litigation. No governmental agency or authority shall have
instituted, or threatened in writing to institute, any action or proceeding     
seeking to delay, restrain, enjoin, or prohibit the consummation of the         
transactions contemplated by this Agreement, and no order, judgment, or decree  
by any court or governmental agency or authority shall be in effect that        
enjoins, restrains, or prohibits the same or, in the reasonable judgment of     
Tyler, otherwise would materially interfere with the operation of the assets and
business of Tyler and the Tyler Subsidiaries or the Company and the Company     
Subsidiaries after the Closing Date.                                            

     7.3  The Software Group. Tyler or a subsidiary of Tyler shall have acquired
all or substantially all of the outstanding capital stock or assets of The      
Software Group, Inc., a Texas corporation ("TSG"), pursuant to that certain     
Agreement and Plan of Merger dated as of October 8, 1997 among Tyler, T2        
Acquisition Corporation, TSG, Brian B. Berry, and Glenn A. Smith, as such       
agreement may be amended and/or restated from time to time.                     

ARTICLE 8 

CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY AND THE SHAREHOLDER

     Except as may be waived by the Company and the Shareholder, the obligations
of the Company and the Shareholder to consummate the transactions contemplated  
by this Agreement shall be subject to the satisfaction on or before the Closing 
Date of each of the following conditions:                                       

     8.1  Compliance. Tyler shall have, or shall have caused to be, satisfied or
complied with and performed in all material respects all terms, covenants, and  
conditions of this Agreement to be complied with or performed by Tyler on or    
before the Closing Date.                                                        

8.2  Representations and Warranties. All of the representations and   
warranties made by Tyler in this Agreement, the Tyler Disclosure Schedule (prior
to supplementation or amendment thereto pursuant to Section 4.2 of this         
Agreement), the Employment Agreement, and in all certificates and other         
agreements delivered by Tyler to the Shareholder pursuant hereto or in          
connection with the transactions contemplated hereby, shall have been true and  
correct in all material respects as of the date hereof, and shall be true and   
correct in all material respects at the Closing Date with the same force and    
effect as if such representations                                               

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and warranties had been made at and as of the Closing Date, except for changes  
permitted or contemplated by this Agreement.                                    

8.3  Opinion. The Company and the Shareholder shall have received an  
opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. ("Liddell, Sapp"),      
counsel for Tyler, dated the Closing Date, in form and substance reasonably     
satisfactory to the Company, the Shareholder and their counsel, relating to the 
matters set forth in the following Sections of this Agreement:                  

        3.1; 3.4 (except the opinion shall contain no exception with respect
    to shareholder approval); and 3.5 (except the opinion as to enforceability
  may exclude the Employment Agreement and the Noncompetition Agreements).

8.4  No Material Adverse Change. There shall have occurred no material
adverse change in the businesses, properties, assets, liabilities, results of   
operations or condition (financial or otherwise) of Tyler and the Tyler         
Subsidiaries, taken as a whole.                                                 

8.5  Tyler Stockholder Approval. The stockholders of Tyler shall have 
approved the Merger and this Agreement on or before March 31, 1998.             

     8.6  Financing. On or before thirty days after the date hereof, Tyler shall
have obtained financing for the transactions contemplated hereby acceptable to  
Tyler.                                                                          

  8.7  Certificates. The Company and the Shareholder shall have received a
certificate or certificates, executed on behalf of Tyler by the President or any
Vice President of Tyler, to the effect that the conditions contained in Sections
7.1 and 7.2 hereof with respect to matters therein relating to Tyler, and in    
Sections 8.1, 8.2, 8.4, 8.5 and 8.6 hereof, have been satisfied.                

ARTICLE 9 

CONDITIONS PRECEDENT TO OBLIGATIONS OF TYLER

Except as may be waived by Tyler, the obligations of Tyler and Sub to 
consummate the transactions contemplated by this Agreement shall be subject to  
the satisfaction, on or before the Closing Date, of each of the following       
conditions:                                                                     

    9.1  Compliance. The Company and the Shareholder shall have, or shall have
caused to be, satisfied or complied with and performed in all material respects 
all terms, covenants, and conditions of this Agreement to be complied with or   
performed by any of them on or before the Closing Date.                         

9.2  Representations and Warranties. All of the representations and   
warranties made by the Company and the Shareholder in this Agreement, the       
Company Disclosure Schedule (prior to any supplementation or amendment pursuant 
to Section 4.2 of this Agreement), and in all certificates and other documents  
delivered by the Company and the Shareholder pursuant hereto or in connection   
with the transactions contemplated hereby, shall have been true and correct in  
all material respects as of the date hereof, and shall be true and correct in   
all material respects at the Closing Date with the same force and effect as if  
such representations and warranties had been made at and as of the Closing Date,
except for changes permitted or contemplated by this Agreement, and except to   
the extent the Company or the Shareholder is unable to give such representation 
or warranty due to any of the following: (a) loss of any title insurance        
customer of Title Records Corporation, or (b) loss of Dallas County as a        
customer due to the bidding process.                                            

9.3  Securities Law Compliance. The issuance and delivery of shares of
Tyler Common Stock in the Merger shall have been registered or qualified under  
the Securities Act and all applicable state securities laws or counsel for Tyler
shall be satisfied that an exemption from such registration or qualification is 
available; no stop order suspending the effectiveness of any such registration  
or qualification shall be in effect; and no proceeding for such purpose shall be
pending before any agency or authority having jurisdiction thereof.             

  9.4  Opinions. Tyler shall have received the opinion of Gardere & Wynne,
L.L.P. ("Gardere & Wynne"), counsel for the Company and the Shareholder, dated  
as of the Closing Date, in form and substance                                   
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satisfactory to Tyler and its counsel, relating to the matters set forth in the 
following Sections of this Agreement:                                           

          2.1; 2.6; and 2.7 (except the opinion as to enforceability may exclude
the Employment Agreement and the Noncompetition Agreements).          

9.5  No Material Adverse Change. There shall have occurred no material
adverse change in the businesses, properties, assets, liabilities, results of   
operations, or condition (financial or otherwise), of the Company and the       
Company Subsidiaries, taken as a whole. Tyler acknowledges and agrees that the  
following shall not be deemed a material adverse effect: (a) loss of any title  
insurance customer of Title Records Corporation, or (b) loss of Dallas County as
a customer due to the bidding process.                                          

     9.6  Consents to Transaction. Tyler and the Company shall have received all
consents or approvals, and made all applications, requests, notices, and filings
with, any person, governmental authority, or governmental agency required to be 
obtained or made in connection with the consummation of the transactions        
contemplated by this Agreement, excluding actions required under the HSR Act    
(which are conditions precedent to closing under Section 7.1), but including the
consents of the lenders and third parties set forth in the Company Disclosure   
Schedule and the Tyler Disclosure Schedule.                                     

  9.7  Stockholder Approval. The stockholders of Tyler shall have approved
the Merger and this Agreement on or before March 31, 1998.                      

     9.8  Financing. On or before thirty days after the date hereof, Tyler shall
have obtained financing for the transactions contemplated hereby acceptable to  
Tyler.                                                                          

9.9  Noncompetition Agreements. Each of the Employees shall have duly 
entered into Noncompetition Agreements with the Company acceptable to Tyler.    

9.10  Certificates. Tyler shall have received a certificate or        
certificates, executed on behalf of the Company by the President of the Company,
and by the Shareholder in his individual capacity, to the effect that the       
conditions in Sections 7.1 and 7.2 hereof with respect to matters therein       
relating to the Company, and Sections 9.1, 9.2, and 9.5 hereof, have been       
satisfied.                                                                      

   9.11  Company Shareholder Approval. The shareholders of the Company shall
have approved the Merger and this Agreement on or before January 31, 1998.      

    9.12  No Dissenting Shareholders. No shareholder of the Company shall have
exercised his right to dissent from the Merger.                                 

ARTICLE 10

SECURITIES LAW REGISTRATION AND COMPLIANCE

  10.1  Securities Law Compliance; Restrictions on Shares. The Shareholder
acknowledges receipt of the Tyler Commission Filings and the Tyler Disclosure   
Schedule and the opportunity to ask questions of and receive answers from       
representatives of the management of Tyler concerning the terms and conditions  
of the transactions contemplated hereby and to obtain all additional information
that Tyler possesses or could acquire without unreasonable expense that is      
necessary to verify the accuracy of information furnished to him, and           
acknowledges and agrees:                                                        

          (a) The shares of Tyler Common Stock to be received by him as a result
of the Merger have not been registered under the Securities Act or any
applicable state securities law;                                      

      (b) Except for transfers pursuant to the Key Employee Options, the
     Shareholder is acquiring the shares so to be received in the Merger for his
   own account and not with a view to the distribution or resale thereof and
     will not sell, pledge, hypothecate, or otherwise transfer the shares unless
they are registered under the Securities Act and applicable state     
     securities laws unless, prior thereto, the Shareholder shall have delivered
to Tyler an opinion, in form and substance reasonably satisfactory to 
Tyler, of counsel                                                     

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experienced and competent in federal securities laws and acceptable to
Tyler, to the effect that an exemption from registration is available 
therefor;                                                             

    (c) Except as otherwise provided in this Agreement, Tyler has no
    obligation to register any sales or transfers of the shares so received by
the Shareholder;                                                      

          (d) Except pursuant to the Key Employee Options, during the year after
the Merger, the Shareholder will not be able to sell, transfer, or    
otherwise dispose of the shares so received unless, prior thereto, the
     Shareholder shall have delivered to Tyler an opinion, in form and substance
   reasonably satisfactory to Tyler, of counsel experienced and competent in
federal securities laws and acceptable to Tyler, to the effect that an
   exemption from registration under the Securities Act and applicable state
  securities laws is at the time available (unless registered as elsewhere
    provided in this Agreement), and thereafter any sales, transfers, or other
dispositions may be limited by the provisions of Rule 144 under the   
Securities Act (or by other rules then in effect);                    

         (e) In view of the foregoing, each Shareholder understands that he is
   at economic risk with respect to his investment in the shares so received
in the Merger;                                                        

(f) Tyler may place an appropriate legend on the certificate
   representing the shares so to be received restricting their transfer, and
stop-transfer instructions will be given to the transfer agent for the
Tyler Common Stock with respect to such certificates; and             

         (g) To provide such information as may be requested by Tyler in order
    for Tyler to determine if the Shareholder is an accredited purchaser under
     Regulation D of the Commission or otherwise can be qualified as a purchaser
under Rule 506 of such Regulation D.                                  

10.2  Demand Registration.                                            

   (a) At any time after the Closing Date, the Shareholder may request Tyler
to register under the Securities Act, the shares of Tyler Common Stock received 
in the Merger and held by the Shareholder ("Shares") for sale in accordance with
the intended methods of disposition described in the Shareholder's request for  
registration; provided, however, that the number of Shares to be registered in  
any such offering, whether registered on behalf of the Shareholder, Tyler or any
other selling shareholder, shall not be less than 3,000,000. Tyler is only      
obligated to register Shares under this Section 10.2 on two occasions.          

     (b) Promptly following receipt of any notice under this Section 10.2, Tyler
shall file a registration statement under the Securities Act for the offering   
and sale of the Shares specified in such notice from the Shareholder within 90  
days of receipt of such notice; provided, however, that Tyler shall not be      
required to maintain the effectiveness of any registration statement pursuant to
this Section 10.2 for a period in excess of the completion of the distribution  
of such Shares as described in Section 10.4(g) hereof if such registration      
statement relates to an underwritten public offering and, if not, a period not  
in excess of the earlier of (i) two years after the effectiveness of such       
registration statement, or (ii) such time as the Shareholder is free to sell his
Shares under Rule 144 under the Securities Act (or any successor rule then in   
effect) without any volume restrictions. Tyler shall be obligated to register   
Shares pursuant to this Section 10.2 on two occasions only; provided that no    
request may be made more than six years after the date hereof; provided,        
further, that a request shall be counted only when (i) all of the Shares        
requested to be included in any such registration have been so included, (ii)   
the corresponding registration statement has become effective under the         
Securities Act, and (iii) the public offering has been consummated on the terms 
and conditions specified therein or, if not consummated, such failure was not   
attributable to an action taken, or a failure to take action, by Tyler in       
connection with such registration. Notwithstanding anything to the contrary     
contained herein, Tyler shall not be obligated to prepare and file any          
registration statement pursuant to this Section 10.2, or prepare or file any    
amendment or supplement thereto, and may suspend the Shareholder's rights to    
make sales of Shares pursuant to an effective registration statement, at any    
time when the Board of Directors of Tyler in good faith believes that the filing
thereof at the time requested, or the offering of securities pursuant thereto,  
would not be in Tyler's best interests. The filing of a registration statement, 
or any amendment or supplement thereto, by Tyler cannot be deferred, and the    
Shareholder's rights to make sales pursuant to an effective registration        

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statement cannot be suspended, pursuant to the provisions of the immediately    
preceding sentence for more than 180 days after the date of the receipt of      
notice under this Section 10.2.                                                 

(c) If the Shareholder proposes to register Shares for sale in an     
underwritten public offering, Tyler shall be entitled to select, in its sole    
discretion, the managing underwriter or underwriters for the offering by the    
Shareholder. Tyler shall be entitled to include in any registration statement   
filed pursuant to this Section 10.2 for an offering specified by the            
Shareholder, securities of Tyler entitled generally to vote in the election of  
directors (or any securities convertible into or exchangeable for or exercisable
for the purchase of securities so entitled generally to vote in the election of 
directors) (collectively, the "Voting Securities") to be sold by Tyler for its  
own account. Subject to the provisions of this Agreement, Tyler agrees to use   
its reasonable efforts to cause all the Shares for which the Shareholder has    
requested registration to be registered as soon as practicable under the        
Securities Act to the extent required to permit the sale by the Shareholder of  
such Shares; provided, that if the managing underwriter or underwriters believe 
that the inclusion of all shares requested to be included in the proposed       
underwritten public offering (including the Shares) would adversely affect the  
marketing of such shares, then Tyler may first include in such registration all 
securities Tyler proposes to sell, and in such event the Shareholder shall      
accept a reduction (including a total elimination) in the number of Shares to be
included in such registration, pro rata with the other holders of Tyler Common  
Stock making requests for registration, on the basis of the number of shares of 
Tyler Common Stock so requested to be included by the Shareholder and the other 
selling shareholders. In the event of any such reduction (or elimination) of the
number of Shares to be included in such registration, the request made by the   
Shareholder under Section 10.2 shall not be counted.                            

     10.3  Piggyback Registration. If Tyler proposes (whether or not for its own
account) to register any of its securities under the Securities Act (other than 
pursuant to Section 10.2) for sale (other than on Form S-8, Form S-4, or Form   
S-3 with respect to sales of securities acquired by employees or former         
employees of Tyler or its subsidiaries upon exercise of options granted by the  
Shareholder of Tyler) Tyler shall give written notice to the Shareholder of its 
intention to effect such a registration not later than 15 days prior to the     
anticipated date of filing with the Commission of a registration statement,     
which notice shall offer the Shareholder the opportunity to include in such     
registration statement any of the Shares the Shareholder may request (a         
"Piggyback Registration"). Tyler's obligation under this Section 10.3 shall be  
limited to registrations as to which a registration statement is to be filed on 
or before six years after the date hereof. Subject to the provisions of this    
Agreement, Tyler will use its reasonable efforts to cause all the Shares for    
which the Shareholder has requested registration to be registered as soon as    
practicable under the Securities Act to the extent required to permit the sale  
by the Shareholder of such Shares; provided, that if the registration relates to
an underwritten public offering and the managing underwriter or underwriters    
believe that the inclusion of all shares requested to be included in the        
proposed registration would adversely affect the marketing of such shares, Tyler
may first include in such registration all securities Tyler proposes to sell,   
and the Shareholder shall accept a reduction (including a total elimination) in 
the number of shares to be included in such registration, pro rata with the     
other holders of Tyler Common Stock making requests for registration, on the    
basis of the number of shares of Tyler Common Stock so requested to be included 
by the Shareholder and the other selling shareholders. Nothing in this section  
shall limit Tyler's ability to withdraw a registration statement it has filed   
either before or after effectiveness.                                           

 10.4  Registration Procedures. If and whenever Tyler is required by the
provisions of Section 10.2 to use its best efforts to effect the registration of
any of the Shares under the Securities Act, Tyler will:                         

          (a) prepare and file with the Commission a registration statement with
respect to such securities and use its best efforts to cause such     
registration statement to become and remain effective for the period  
specified in Section 10.2(b);                                         

(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in 
connection therewith as may be necessary to keep such registration    
    statement effective for the period specified in Section 10.2(b) and as may
be necessary to comply with the provisions of the Securities Act with 
respect to the disposition of all Shares covered by such              

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 registration statement in accordance with the method of disposition set
forth in such registration statement for such period;                 

        (c) furnish to the Shareholder and to any underwriter such number of
  copies of the registration statement and the prospectus included therein
  (including each preliminary prospectus and each document incorporated by
    reference therein to the extent then required by the rules and regulations
of the Commission) as such persons may reasonably request in order to 
  facilitate the public sale or other disposition of the Shares covered by
such registration statement;                                          

         (d) use its best efforts to register or qualify the Shares covered by
   such registration statement under the securities or blue sky laws of such
jurisdictions as the Shareholder or any managing underwriter shall    
reasonably request and to take all necessary action to keep such      
     registration or qualification effective as required by this Section 10.4 as
     to a registration statement filed with the Commission; provided, that Tyler
shall not be required to qualify to transact business as a foreign    
     corporation in any jurisdiction in which it would not otherwise be required
    to be so qualified or to take any action which would subject it to general
 service of process in any such jurisdictions in which it is not then so
subject;                                                              

      (e) immediately notify the Shareholder and any underwriter, at any
   time when a prospectus relating thereto is required to be delivered under
  the Securities Act, of the happening of any event as result of which the
 prospectus contained in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any 
material fact required to be stated therein or necessary to make the  
  statements therein not misleading in the light of the circumstances then
    existing (in which case, Tyler shall promptly provide the Shareholder with
revised or supplemental prospectuses and if so requested by Tyler, the
  Shareholder shall promptly take action to cease making any offers of the
Shares until receipt and distribution of such revised supplemental    
prospectuses);                                                        

       (f) furnish at the request of the Shareholder, (i) on the date that
the Shares are delivered to any underwriters for sale pursuant to such
   registration statement, an opinion of counsel representing Tyler dated as
of such date for the purposes of such registration, addressed to the  
underwriters and to the Shareholder, stating that such registration   
     statement has become effective under the Securities Act and that (A) to the
    best knowledge of such counsel, no stop order suspending the effectiveness
thereof has been issued and no proceedings for that purpose have been 
     instituted or are pending or contemplated under the Securities Act, (B) the
registration statement, the related prospectus, and each amendment or 
 supplement thereof, comply as to form in all material respects with the
     requirements of the Securities Act and the applicable rules and regulations
thereunder (except that such counsel need express no opinion as to the
financial statements or any other financial or statistical data or any
     engineering report contained or incorporated therein) and (C) to such other
   effects as may reasonably be requested by counsel for the underwriters or
    by the Shareholder or their counsel, and (ii) on the effective date of the
registration statement, the date that Shares are delivered to any     
  underwriters for sale pursuant to such registration statement and on the
effective date of each post-effective amendment to the registration   
    statement, a "comfort" letter dated such date from the regular independent
    accountants retained by Tyler, addressed to the underwriters, stating that
they are independent public accountants within the meaning of the     
    Securities Act and that, in the opinion of such accountants, the financial
statements of Tyler included or incorporated by reference in the      
  registration statement or the prospectus, or any amendment or supplement
 thereto, comply as to form in all material respects with the applicable
   accounting requirements of the Securities Act and the published rules and
     regulations thereunder, and such letter shall additionally cover such other
  financial matters (including information as to the period ending no more
   than five business days prior to the date of such letter) included in the
  registration statement in respect of which such letter is being given as
the underwriters or the Shareholder may reasonable request;           

         (g) make available for inspection during normal business hours to the
    Shareholder, any underwriter participating in any distribution pursuant to
  such registration statement, and any attorney, accountant or other agent
retained by the Shareholder or underwriters, all financial and other  
records, pertinent corporate documents and properties of Tyler and its
     subsidiaries, and cause Tyler's officers, directors and employees to supply
all information reasonably requested by any such representative of the
Shareholder,                                                          

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underwriter, attorney, accountant or agent in connection with such    
registration statement. For purposes of Section 10.2(b), the period of
  distribution of Shares in a firm commitment underwritten public offering
shall be deemed to extend until each underwriter has completed the    
distribution of all securities purchased by it; and                   

(h) use its best efforts to keep effective and maintain any 
registration, qualification, approval or listing obtained to cover the
  Shares as may be necessary for the Shareholder to dispose of such Shares
during the period of distribution and shall from time to time amend or
supplement any prospectus used in connection therewith to the extent  
necessary in order to comply with applicable law; provided that,      
  notwithstanding the foregoing, Tyler shall not be required to file or to
    keep effective and maintain any such registration, qualification, approval
     or listing for such period that would require it to cause an audit of Tyler
   to be performed other than as is required by the rules and regulations of
the Commission with respect to reports required to be filed under the 
Exchange Act.                                                         

     In connection with any registration hereunder, the Shareholder will furnish
promptly to Tyler in writing such information (together with such supplements as
may be necessary from time to time) with respect to itself and the proposed     
distribution by it as shall be reasonably necessary in order to ensure          
compliance with federal and applicable state securities laws. Such information  
shall not, at the time the registration statement is filed or becomes effective,
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under   
which they were made, not false or misleading.                                  

  In any registration relating to an underwritten public offering of Tyler
Common Stock or other Voting Securities, whether or not the Shareholder is      
participating in such registered underwritten public offering, at the request of
the managing underwriter or underwriters, the Shareholder will agree not to     
effect any sale or distribution, including any sale pursuant to Rule 144 (or any
successor provision) promulgated under the Securities Act of any Shares, and not
to effect any such sale or distribution of any other Tyler Common Stock or      
Voting Securities (in each case, other than as part of such registration) for   
such period of time as reasonably required by such managing underwriter or      
underwriters ("Lockup Period"), but in no event shall the Shareholder be        
required to agree to a Lockup Period longer than the Lockup Period to which any 
other selling shareholder is subject.                                           

   In connection with any registration hereunder relating to an underwritten
public offering, Tyler agrees to enter into a written agreement with the        
managing underwriter or underwriters, and condition the participation of any    
other shareholder in such registration on such shareholder entering into such a 
written agreement, in such form and containing such provisions as are customary 
in the securities business for such an arrangement between underwriters and     
companies of Tyler's size and investment stature, including, but not limited to,
indemnification and contribution provisions from the underwriters for the       
benefit of Tyler and its controlling persons; provided that such agreement shall
not contain any such provisions applicable to Tyler that are inconsistent with  
the provisions hereof; and further provided, that the time and place of the     
closing under said agreement shall be as mutually agreed upon among Tyler, the  
Shareholder and such managing underwriter or underwriters. The obligation of    
Tyler set forth in the immediately preceding sentences shall apply on each      
occasion of an underwritten public offering as may be contemplated by a request 
for registration permitted by Section 10.2(a).                                  

    10.5  Expenses. In connection with any proposed registration of securities
by Tyler, whether or not effected or consummated, Tyler, the Shareholder, and   
any other selling shareholders shall each pay their pro rata share of Tyler's   
out of pocket expenses incurred in connection with a proposed registration under
either Section 10.2 or 10.3 in which Tyler is not selling any securities for its
own account, including, without limitation, all registration and filing fees,   
printing expenses, and fees and disbursements of counsel and accountants for    
Tyler. The Shareholder shall pay all of his expenses, including his attorney's  
fees, and including the underwriting discount, selling commissions and all      
expenses of the underwriters relating to his Shares incurred in connection with 
each registration pursuant to Section 10.2 or 10.3.                             

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10.6  Indemnification.                                                

(a) In the event of a registration of any of the Shares under the     
Securities Act pursuant to Section 10.2 or 10.3, Tyler shall indemnify and hold 
harmless the Shareholder and each underwriter of Shares thereunder and each     
person who controls the Shareholder or underwriter within the meaning of the    
Securities Act and the Exchange Act against any losses, claims, damages or      
liabilities (including reasonable attorneys' fees), joint or several, to which  
the Shareholder or underwriter or controlling person may become subject under   
the Securities Act, the Exchange Act or otherwise, insofar as such losses,      
claims, damages or liabilities (or actions in respect thereof) or arise out of  
or are based upon any untrue statement or alleged untrue statement of any       
material fact contained in the registration statement under which such Shares   
were registered under the Securities Act pursuant to Section 10.2 or 10.3, any  
preliminary prospectus or final prospectus contained therein, or any amendment  
or supplement thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or      
necessary to make the statements therein not misleading, and will reimburse each
such Shareholder, underwriter and controlling person for any legal or other     
expenses reasonably incurred by them in connection with investigating or        
defending any such loss, claim, damage, liability or action; provided, however, 
that Tyler will not be liable in any such case if and to the extent that any    
such loss, claim, damage or liability arises out of or is based upon an untrue  
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by the Shareholder, underwriter or        
controlling person for use in such registration statement or prospectus;        
provided, further, that Tyler will not be liable hereunder to any underwriter or
any person who controls any underwriter within the meaning of the Securities Act
and the Exchange Act for any loss, claim, damage or liability that arises out   
of, or is based upon, any untrue statement or alleged untrue statement or any   
omission or alleged omission contained in any preliminary prospectus that was   
corrected by any subsequent prospectus, and the underwriter was required to     
deliver but failed to deliver such prospectus as required by the Securities Act.

(b) In the event of a registration of any of the Shares under the     
Securities Act pursuant to Section 10.2 or 10.3, the Shareholder shall indemnify
and hold harmless Tyler and each person who controls Tyler within the meaning of
the Securities Act and the Exchange Act, each officer of Tyler who signs the    
registration statement, each director of Tyler, each underwriter and each person
who controls any underwriter within the meaning of the Securities Act and the   
Exchange Act against all losses, claims, damages or liabilities, joint or       
several, to which Tyler or such officer or director or underwriter or           
controlling person may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or      
alleged untrue statement of any material fact contained in the registration     
statement under which such Shares were registered under the Securities Act      
pursuant to Section 10.2 or 10.3, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or arise out of or   
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein not misleading, and will reimburse Tyler and each 
such officer, director, underwriter and controlling person for any legal or     
other expenses reasonably incurred by them in connection with investigating or  
defending any such loss, claim, damage, liability or action; provided, however, 
that the Shareholder will be liable hereunder in any such case if and only to   
the extent that any such loss, claim, damage or liability arises out of or is   
based upon an untrue statement or alleged untrue statement or omission or       
alleged omission relating to the Shareholder made in reliance upon and in       
conformity with information pertaining to the Shareholder, as such, furnished in
writing to Tyler by the Shareholder for use in such registration statement or   
prospectus ("Shareholder Information"); provided, further, that the Shareholder 
will not be liable hereunder to any underwriter or any person who controls an   
underwriter within the meaning of the Securities Act and the Exchange Act for   
any loss, claim, damage or liability that arises out of, or is based upon, any  
untrue statement or alleged untrue statement or any omission or alleged omission
in any Shareholder Information contained in any preliminary prospectus that was 
corrected by any subsequent prospectus, and the underwriter was required to     
deliver but failed to deliver such prospectus as required by the Securities Act.

   (c) Promptly after receipt by an indemnified party hereunder of notice of
the commencement of any action, such indemnified party shall, if a claim in     
respect thereof is to be made against the indemnifying party                    

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hereunder, notify the indemnifying party in writing thereof, but the omission so
to notify the indemnifying party shall not relieve it from any liability which  
it may have to any indemnified party other than under this Section 10.6. In case
any such action shall be brought against any indemnified party and it shall     
notify the indemnifying party of the commencement thereof, the indemnifying     
party shall be entitled to participate in and, to the extent it shall wish, to  
assume and undertake the defense thereof with counsel reasonably satisfactory to
such indemnified party and, after notice from the indemnifying party to such    
indemnified party of its election so to assume and undertake the defense        
thereof, the indemnifying party shall not be liable to such indemnified party   
under this Section 10.6 for any legal expenses subsequently incurred by such    
indemnified party in connection with the defense thereof other than reasonable  
costs of investigation and of liaison with counsel so selected; provided,       
however, that (i) if the indemnifying party has failed to assume the defense and
employ counsel or (ii) if the defendants in any such action include both the    
indemnified party and the indemnifying party and the indemnified party shall    
have reasonably concluded that there may be reasonable defenses available to it 
that are different from or additional to those available to the indemnifying    
party or if the interests of the indemnified party reasonably may be deemed to  
conflict with the interests of the indemnifying party, then the indemnified     
party shall have the right to select a separate counsel and to assume such legal
defense and otherwise to participate in the defense of such action, with the    
expenses and fees of such separate counsel and other expenses related to such   
participation to be reimbursed by the indemnifying party as incurred.           

     (d) If the indemnification provided for in this Section 10.6 is unavailable
or insufficient to hold harmless an indemnified party in respect of any losses, 
claims, damages or liabilities or actions in respect thereof, then each         
indemnifying party shall in lieu of indemnifying such indemnified party         
contribute to the amount paid or payable by such indemnified party as a result  
of such losses, claims, damages, liabilities or actions in such proportion as is
appropriate to reflect the relative fault of Tyler, on the one hand, and the    
Shareholder, on the other, in connection with the statements or omissions which 
resulted in such losses, claims, damages, liabilities or actions as well as any 
other relevant equitable considerations, including the failure to give any      
required notice. The relative fault shall be determined by reference to, among  
other things, whether the untrue or alleged untrue statement of a material fact 
or the omission or alleged omission to state a material fact relates to         
information supplied by Tyler, on the one hand, or the Shareholder, on the      
other, and the parties' relative intent, knowledge, access to information and   
opportunity to correct or prevent such statement or omission. Tyler and the     
Shareholder agree that it would not be just and equitable if contribution       
pursuant to this Section 10.6(d) were determined by pro rata allocation or by   
any other method of allocation which does not take account of the equitable     
considerations referred to above in this Section 10.6(d). The amount paid or    
payable by an indemnified party as a result of the losses, claims, damages,     
liabilities or actions in respect thereof referred to above in this Section     
10.6(d) shall be deemed to include any legal or other expenses reasonably       
incurred by such indemnified party in connection with investigating or defending
any such action or claim. No person guilty or fraudulent misrepresentation      
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent              
misrepresentation.                                                              

10.7  No Transferability of Registration Rights. Except with the prior
written consent of Tyler, the Shareholder's registration rights under Sections  
10.2 and 10.3 shall not inure to the benefit of any person to whom any Shares   
are transferred, other than the spouse or descendants of the Shareholder (his   
"Relatives"), a trust solely for the benefit of the Shareholder or his          
Relatives, or a partnership all of the equity interests in which are directly or
indirectly owned by the Shareholder or his Relatives.                           

ARTICLE 11

INDEMNIFICATION AND REMEDIES

11.1  Indemnification by the Shareholder Based on Agreement. The      
Shareholder agrees to indemnify and hold harmless Tyler (and if the transactions
contemplated hereby are consummated, the Surviving Corporation), from and       
against any and all claims, losses, obligations, damages, demands, and          
liabilities (after giving effect to and reducing the same by (i) any net tax    
benefits realized by Tyler or the Surviving                                     

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Corporation as a result of such event, and (ii) the net amount of any insurance 
proceeds received by Tyler or the Surviving Corporation as a result of such     
event), including, without limitation, costs and expenses of litigation         
(including reasonable attorneys' and accountants' fees) (collectively, "Tyler   
Indemnified Losses"), based on, relating to, or arising out of, or any          
allegation by any third party of, any facts or circumstances that would         
constitute a breach by the Shareholder of any representation, warranty, or      
covenant contained herein or in any agreement executed pursuant hereto; but     
excluding from this covenant to indemnify any claims or liabilities separately  
covered by Section 10.6 hereof or any Customer Claims (hereinafter defined) to  
the extent and only while covered by the provisions of Section 11.3 hereof.     

11.2  Indemnification by Tyler Based on Agreement. Tyler (and if the  
transactions contemplated hereby are consummated, the Surviving Corporation)    
agrees to indemnify and hold harmless the Shareholder from and against any and  
all claims, losses, expenses, obligations, demands and liabilities (after giving
effect to and reducing the same by (i) any net tax benefits realized by the     
Shareholder as a result of such event, and (ii) the net amount of any insurance 
proceeds received by the Shareholder as a result of such event), including,     
without limitation, costs and expenses of litigation and including reasonable   
attorneys' and accountants' fees (collectively, "Shareholder Indemnified        
Losses"), based on, relating to, or arising out of, or any allegation by any    
third party of, any facts or circumstances that would constitute a breach by    
Tyler of any representation, warranty, or covenant contained herein or in any   
agreement executed pursuant hereto, but excluding from this covenant to         
indemnify any claims or liabilities separately covered by the provisions of     
Section 10.6 hereof.                                                            

     11.3  Customer Claims. If any claim, demand, or cause of action of the type
referred to in Section 11.1 is asserted by a customer of the Company or a       
Company Subsidiary ("Customer Claim"), the following provisions shall be        
applicable until such time as the Customer Claim results in a filed and pending 
lawsuit or other judicial proceeding (at which time the provisions of Section   
11.1 shall be applicable):                                                      

    (a) Tyler or the Surviving Corporation shall promptly notify the
    Shareholder in writing that a Customer Claim has been made, describing the
nature of the Customer Claim to the extent then known.                

       (b) After receipt of Tyler's or the Surviving Corporation's written
notice, the parties hereto will fully cooperate with each other to    
    investigate the Customer Claim and determine whether the parties can agree
that the Customer Claim is an obligation or liability for which the   
Shareholder is responsible. The investigation shall be conducted      
expeditiously and with all reasonable due diligence, considering the  
circumstances surrounding the Customer Claim.                         

          (c) If, after an investigation, Tyler or the Surviving Corporation and
   the Shareholder agree in writing that the Customer Claim is an obligation
    or liability for which the Shareholder is responsible, the Shareholder and
Tyler or the Surviving Corporation agree to use their reasonable best 
efforts to reach an agreement with the customer as to the terms and   
     conditions of settlement, compromise or satisfaction of the Customer Claim,
     including, but not limited to, the amount that the Shareholder shall pay to
 the customer for the damages, losses, costs or expenses incurred by it.

       (d) If the provisions of this Section 11.3 are applicable, Tyler or
   the Surviving Corporation shall conduct all communications and settlement
    negotiations with the customer and shall convey to the customer any offers
of settlement or compromise by the Shareholder. Any amounts that the  
   Shareholder agrees so to pay in settlement of the Customer Claim shall be
   paid by him to Tyler or the Surviving Corporation, as the case may be, in
trust for payment over to the customer. If Tyler or the Surviving     
    Corporation agrees to pay the customer an amount in excess of that offered
 for settlement purposes by the Shareholder, the excess shall be paid by
   Tyler or the Surviving Corporation, as the case may be, without any right
  to indemnification therefor from the Shareholder. If the amounts so paid
  and entrusted to Tyler or the Surviving Corporation are paid over to the
    customer, the payment over shall be deemed to be a release by Tyler or the
  Surviving Corporation of any further claim with respect to that Customer
     Claim against the Shareholder and Tyler and the Surviving Corporation shall
     indemnify and hold harmless the Shareholder from any further liability with
respect thereto.                                                      

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  (e) In the absence of an agreement among the parties as to the
 settlement of any Customer Claim not involving litigation, Tyler or the
 Surviving Corporation may take such action with respect to the Customer
   Claim as Tyler in its sole judgment may deem necessary or advisable under
the circumstances to settle, compromise or satisfy the Customer Claims
     provided; however, neither Tyler nor the Surviving Corporation shall in any
such event be considered to have waived its right to pursue a judicial
action to determine its right against the Shareholder.                

        (f) An indemnified party shall give notice to the indemnifying party
or parties within 15 business days after actual receipt of service or 
    summons to appear in any action begun in respect of which indemnity may be
    sought hereunder, or actual notice of assertion of a claim with respect to
    which it seeks indemnification. Except as provided in Section 4.5, failure
    so to notify the indemnifying party or parties shall cause the indemnified
party to lose its right to indemnification under this Article 11, but 
  failure so to notify the indemnifying party or parties shall not relieve
 the indemnifying party or parties from any liability that they may have
     other than on account of this Article 11. The indemnifying party or parties
    may participate at their own expense and with their counsel in the defense
of such action.                                                       

    Except as otherwise provided in Section 11.3(d), if the indemnifying party
or parties so elect within a reasonable time after receipt of such notice they  
may assume the defense of such action with counsel chosen by the indemnifying   
party or parties and approved by the indemnified party in such action, unless   
the indemnified party reasonably objects to such assumption on the ground that  
its counsel has advised it that there may be legal defenses available to it that
are different from or in addition to those available to the indemnifying party  
or parties and counsel for the indemnifying party concurs in such advice, in    
which case the indemnified party shall have the right to employ counsel approved
by the indemnifying party or parties. If the indemnifying party or parties      
assume the defense of such action, the indemnifying party or parties shall not  
be liable for fees and expenses of counsel for the indemnified party incurred   
thereafter in connection with such action. In no event shall the indemnifying   
party or parties be liable for the fees and expenses of more than one counsel   
for the indemnified parties in connection with any one action or separate but   
similar or related actions in the same jurisdiction arising out of the same     
general allegations or circumstances unless, in the reasonable opinion of such  
counsel, there is, under applicable standards of professional conduct, a        
conflict on any significant issue between the positions of any two or more      
indemnified parties.                                                            

   11.4  Claims Limitations. Notwithstanding anything otherwise contained in
this Agreement, no party hereto shall assert any single claim or claims against 
any other party hereto, including any right of offset by Tyler or Surviving     
Corporation pursuant to Section 11.8 hereof, unless the single claim (after     
giving effect to and reducing the same by (i) any net tax benefits realized by  
the indemnified party as a result of such event, and (ii) the net amount of any 
insurance proceeds received by the indemnified party as a result of such event) 
exceeds the sum of $37,500, and the sum of all such single claims in the        
aggregate exceeds $300,000; provided, that claims made by Tyler or Surviving    
Corporation pursuant to Section 2.9 or 4.5 of this Agreement, or for breach of  
the Employment Agreement or the Confidentiality Agreement shall not be subject  
to the foregoing limitations; and provided further, that claims made by the     
Shareholder pursuant to Section 3.7 or 4.5 of this Agreement, or for breach of  
the Employment Agreement or the Confidentiality Agreement shall not be subject  
to the foregoing limitations.                                                   

     11.5  Maximum Liability. The maximum aggregate liability of the Shareholder
to Tyler or the Surviving Corporation for all claims made by Tyler or the       
Company pursuant to this Agreement is $7,500,000; provided, that claims made by 
Tyler or the Surviving Corporation pursuant to Sections 2.9 or 4.5 of this      
Agreement, or for breach of the Employment Agreement or the Confidentiality     
Agreement, shall not be subject to the foregoing limitation. The maximum        
aggregate liability of Tyler or the Surviving Corporation to the Shareholder for
all claims made by the Shareholder pursuant to this Agreement is $7,500,000;    
provided, that claims made by the Shareholder pursuant to Section 3.7 or 4.5 of 
this Agreement, or for breach of the Employment Agreement or the Confidentiality
Agreement, shall not be subject to the foregoing limitation. Any claim based    
upon facts and circumstances that would, if true, constitute a breach of any    
representation, warranty or covenant contained in this Agreement shall be       
subject to the limitations contained herein, notwithstanding the fact that such 
claim is asserted by a cause of action or legal theory other than breach of     

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contract. When calculating the amount of liability in a claim for damages for   
purposes of this Section 11.5 (whether such calculation is through agreement of 
the parties, litigation or otherwise) and the claim relates to the breach of a  
representation as to the income of the Company for any period or periods prior  
to the Closing Date, all of the parties hereto agree that, in determining the   
amount involved in the claim, the damages shall be actual damages incurred and  
proven and such actual damages shall not be computed by using a multiplier or   
capitalization rate.                                                            

    11.6  Equitable Remedies. The parties hereto acknowledge that a refusal by
a party to consummate the transactions contemplated hereby will cause           
irreparable harm to the other parties, for which there may be no adequate remedy
at law. A party not in default at the time of such refusal shall be entitled, in
addition to other remedies at law or in equity, to specific performance of this 
Agreement by the party that refused to consummate the transactions contemplated 
hereby.                                                                         

11.7  Remedies of the Surviving Corporation. After the Closing, the   
Surviving Corporation shall have the same rights and benefits under this        
Agreement as does Tyler with respect to the representations, warranties and     
covenants of the Shareholder contained herein, as fully as if such              
representations, warranties and covenants had been made to the Surviving        
Corporation in lieu or in place of Tyler. In any proceeding by the Surviving    
Corporation to assert or prosecute any claims under, or to otherwise enforce,   
this Agreement on behalf of itself or Tyler, the Shareholder agrees that he     
shall not assert as a defense or bar to recovery by the Surviving Corporation,  
and hereby waives any right to so assert such defense or bar such recovery, that
(a) prior to Closing, the Company shall have had knowledge of the circumstances 
giving rise to the claim being pursued by it; (b) prior to Closing, the Company 
engaged in conduct or took action that caused or brought about the circumstances
giving rise to its claim, or otherwise contributed thereto; (c) the Company is  
estopped from asserting or recovering upon its claim by reason of having joined 
in the representations, warranties and covenants made by the Shareholder in this
Agreement; or (d) the Shareholder has a right of contribution from the Surviving
Corporation to the extent that there is any recovery against him.               

11.8  Right of Offset. In addition to all other remedies at law or in 
equity, after the Closing Tyler and Surviving Corporation (which for purposes of
this Section 11.8 shall mean the Surviving Corporation and Government Record    
Services, Inc.) shall have the right to credit and offset against any payment   
otherwise due the Shareholder under this Agreement, the Employment Agreement or 
any other agreement or document, amounts equal to liabilities and costs incurred
or damages suffered by Tyler or the Surviving Corporation, directly or          
indirectly (including payments made pending or subject to a final resolution of 
any dispute or controversy with a third party and whether or not agreed to by   
the Shareholder if necessary, in the judgment of Tyler, to protect business     
relationships or assets) based on, relating to or arising out of, or any        
allegation by a third party of, any breach, or any facts or circumstances which 
would constitute a breach, by the Shareholder of any representation, warranty,  
or covenant contained in this Agreement, the Employment Agreement or any other  
agreement or document between the Shareholder, Tyler and/or the Surviving       
Corporation executed pursuant hereto or thereto, unless (with respect to a third
party claimant) the Shareholder shall have specifically affirmed that he will   
indemnify and hold Tyler and the Surviving Corporation harmless from such       
liabilities, costs and damages pursuant to applicable provisions of this Article
11 and shall have undertaken the defense of such claim in accordance with this  
Article 11. Tyler will give the Shareholder 30 days prior written notice of the 
Surviving Corporation's intention to offset against any payment otherwise due   
hereunder or under the Employment Agreement or other agreement or document. If  
Tyler or the Surviving Corporation offsets any payment so due and, after final  
determination, Tyler or Surviving Corporation is required to restore payment,   
such payment shall bear interest from the day of initial offset until payment   
restoration at a rate per annum which shall from day to day be the higher of 12%
or the prime rate of interest from time to time published or announced by Texas 
Commerce Bank National Association or any successor thereto.                    

   11.9  Costs of Defense. If any claim for which an indemnified party seeks
indemnification under this Article 11 results in a judgment that no damages are 
due the claimant on a basis for which the indemnifying party is responsible     
hereunder, then, as between the indemnifying and indemnified parties, the       
indemnified parties shall be liable for any damages awarded and the costs       
(including attorneys' fees) of defending such claim.                            

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ARTICLE 12

MISCELLANEOUS 

12.1  Breach Discovered Prior to Closing.                             

(a) If, prior to the Time of Closing, Tyler has actual and certain    
knowledge (as opposed to an opinion or belief) of any facts or circumstances    
that it determines would constitute a failure to satisfy the conditions to the  
obligations of Tyler to close this Agreement contained in Sections 9.1, 9.2 or  
9.5 hereof, Tyler shall promptly give written notice to the Shareholder. If the 
Shareholder fails to cure any such alleged defect within 15 days from the date  
of notice, Tyler shall have the right either to (i) terminate this Agreement    
pursuant to Section 12.2 below, in which case Tyler, shall, if not then in      
default under this Agreement, be entitled to recover from the Company and the   
Shareholder as liquidated damages the actual legal, accounting and other        
out-of-pocket expenses incurred by it in connection with the negotiation,       
preparation and execution of this Agreement and the other agreements and        
instruments referred to herein, its investigation and examination of the affairs
of the Company and the Company Subsidiaries, and other actions taken preparatory
to consummating the transactions contemplated hereby, or (ii) waive such defect 
as a condition to closing this Agreement, in which case Tyler shall not be      
entitled to make any claims against the Shareholder pursuant to this Agreement  
or to exercise any other remedial rights with respect to such alleged defect.   

(b) If, prior to the Time of Closing, the Shareholder has actual and  
certain knowledge (as opposed to an opinion or belief) of any facts or          
circumstances that the Shareholder determines would constitute a failure to     
satisfy the conditions to the obligations of the Company and the Shareholder to 
close this Agreement contained in Sections 8.1, 8.2 and 8.4 hereof, the Company 
and the Shareholder shall promptly give written notice to Tyler. If Tyler fails 
to cure any such alleged defect, the Company and the Shareholder shall have the 
right either to (i) terminate this Agreement pursuant to Section 12.2 below, in 
which case the Company and the Shareholder shall, if not then in default under  
this Agreement, be entitled to recover from Tyler as liquidated damages the     
actual legal, accounting and other out-of-pocket expenses incurred by them (but 
not including such expenses incurred to appropriately document the corporate    
records and transactions of the Company, the Company Subsidiaries and the       
Shareholder) in connection with the negotiation, preparation and execution of   
this Agreement and the other agreements and instruments referred to herein,     
their investigation and examination of the affairs of Tyler, and other actions  
taken preparatory to consummating the transactions contemplated hereby, or (ii) 
waive such defect as a condition to closing this Agreement, in which case the   
Shareholder shall not be entitled to make any claims against Tyler or the       
Surviving Corporation pursuant to this Agreement or to exercise any other       
remedial rights with respect to such alleged defect.                            

    12.2  Termination. This Agreement and the transactions contemplated hereby
may be terminated at any time on or before the Closing Date:                    

(a) by mutual consent of Tyler and the Shareholder;         

         (b) by Tyler if there has been a material misrepresentation or breach
  of warranty in the representations and warranties of the Company and the
   Shareholder set forth herein or if there has been any material failure on
     the part of the Company or the Shareholder to comply with their obligations
hereunder;                                                            

         (c) by the Shareholder if there has been a material misrepresentation
  or breach of warranty in the representations and warranties of Tyler set
     forth herein or if there has been any material failure on the part of Tyler
to comply with its obligations hereunder;                             

(d) by either Tyler or the Shareholder if the transactions  
     contemplated by this Agreement have not been consummated by March 31, 1998,
unless such failure of consummation is due to the failure of the      
terminating party to perform or observe the covenants, agreements, and
conditions hereof to be performed or observed by it at or before the  
Closing Date;                                                         

         (e) by either Tyler or the Shareholder if the conditions precedent to
   its or his obligations to close this Agreement have not been satisfied or
waived by it or him at or before the Closing Date; and                

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(f) by either the Shareholder or Tyler if the transactions  
contemplated hereby violate any nonappealable final order, decree, or 
judgment of any court or governmental body or agency having competent 
jurisdiction.                                                         

    12.3  Expenses. If the transactions contemplated by this Agreement are not
consummated, each party hereto shall pay its own expenses incurred in connection
with this Agreement and the transactions contemplated hereby, except as         
otherwise provided in Section 12.1. Notwithstanding the foregoing, Tyler shall  
pay the actual legal, accounting and other out-of-pocket expenses incurred by   
the Company and Shareholder in connection with the negotiation, preparation and 
execution of this Agreement and the other agreements and instruments referred to
herein, their investigation and examination of the affairs of the Tyler, and    
other actions taken preparatory to consummating the transactions contemplated   
hereby if this Agreement is terminated by Tyler for any reason other than       
failure of a condition precedent to its obligations set forth in Section 9.1,   
9.2, 9.4, 9.9, 9.11 or 9.12 or rightfully terminated by the Company or the      
Shareholder for any other reason (i.e., other than the failure of a condition   
precedent to Tyler's obligations set forth in Section 9.1, 9.2, 9.4, 9.9, 9.11  
or 9.12).                                                                       

   12.4  Disclosure Schedules. The Company Disclosure Schedule and the Tyler
Disclosure Schedule are incorporated herein by reference.                       

12.5  Entire Agreement. This Agreement and the Exhibits and Disclosure
Schedules hereto, the Confidentiality Agreement and the other agreements and    
documents contemplated hereby, contain the complete agreement among the parties 
with respect to the transactions contemplated hereby and supersede all prior    
agreements and understandings among the parties with respect to such            
transactions, including without limitation that certain Agreement and Plan of   
Merger dated as of October 8, 1997 among Tyler, Sub, the Company, and           
Shareholder, as the same was or has heretofore been amended and restated.       
Section and other headings, the table of contents and indexes to the Disclosure 
Schedules are for reference purposes only and shall not affect the              
interpretation or construction of this Agreement. The parties hereto have not   
made any representation or warranty except as expressly set forth in this       
Agreement, the Employment Agreement, the Confidentiality Agreement, the         
Noncompetition Agreements, the Company Disclosure Schedule, the Tyler Disclosure
Schedule or in any agreement, certificate or other document delivered pursuant  
hereto or thereto. The obligations of any party under any agreement executed    
pursuant to this Agreement shall not be affected by this Section.               

    12.6  Survival. All representations and warranties (except those contained
in Sections 2.9 and 2.15) of Tyler, Sub, the Company or the Shareholder         
contained herein, in the Tyler Disclosure Schedule, in the Company Disclosure   
Schedule, or in any exhibit, certificate, document or instrument delivered      
pursuant to this Agreement shall survive the Closing and shall continue in full 
force and effect for two years after the date of Closing. All representations   
and warranties of the Shareholder contained in Section 2.9(b) above shall       
survive the Closing and shall continue in full force and effect after the       
Closing without time limitation. All representations and warranties of the      
Shareholder contained in Sections 2.9(a), (c) and (d) above shall survive the   
Closing and shall continue in full force and effect after the Closing until     
expiration, in accordance with the laws of Texas, of the applicable time period 
in which claims may be judicially asserted for breach of a written contract. All
representations and warranties of the Shareholder contained in Section 2.15     
above shall survive the Closing and shall continue in full force and effect     
after the Closing until expiration, in accordance with applicable law, of the   
applicable time periods in which the taxing authority having jurisdiction may   
assert a claim for failure of or deficiency in the payment of taxes. The        
representations and warranties of the Company shall not survive the Closing.    

12.7  Counterparts. This Agreement may be executed in any number of   
counterparts, each of which when so executed and delivered shall be deemed an   
original, and such counterparts together shall constitute only one original.    

     12.8  Notices. All notices, demands, requests, or other communications that
may be or are required to be given, served, or sent by any party to any other   
party pursuant to this Agreement shall be in writing and                        

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shall be mailed by first-class, registered or certified mail, return receipt    
requested, postage prepaid, or transmitted by hand delivery, telegram, or       
telecopy, addressed as follows:                                                 

(i) If to the Company or the Shareholder;                       

William D. Oates                                  
Business Resources Corporation                    
2800 West Mockingbird Lane                        
Dallas, Texas 75235                               
Telecopy No.: (214) 902-0211                      

with a copy (which shall not constitute notice) to:     

Gardere & Wynne, L.L.P.                           
1601 Elm Street                                   
3000 Thanksgiving Tower                           
Dallas, Texas 75201-4761                          
Attention: John K. Sterling                       
Telecopy No.: (214) 999-4667                      

(ii) If to Tyler:                                               
Tyler Corporation                                 
2121 San Jacinto Street                           
3200 San Jacinto Tower                            
Dallas, Texas 75201                               
Attention: Chairman of the Board                  
Telecopy No.: (214) 754-7821                      

with a copy (which shall not constitute notice) to:     

Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P.      
3400 Texas Commerce Tower                         
600 Travis Street                                 
Houston, Texas 77002-3004                         
Attention: Gene G. Lewis                          
Telecopy No.: (713) 223-3717                      

  Each party may designate by notice in writing a new address to which any
notice, demand, request, or communication may thereafter be so given, served, or
sent. Each notice, demand, request, or communication that is mailed, delivered, 
or transmitted in the manner described above shall be deemed sufficiently given,
served, sent and received for all purposes at such time as it is delivered to   
the addressee (with the return receipt, the delivery receipt, the affidavit of  
messenger, or (with respect to a telecopy) the confirmation being deemed        
conclusive evidence of such delivery) or at such time as delivery is refused by 
the addressee upon presentation.                                                

     12.9  Successors and Assigns. This Agreement and the rights, interests, and
obligations hereunder shall be binding upon and shall inure to the benefit of   
the parties hereto and their respective successors and assigns.                 

 12.10  Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Texas (except the choice of law rules  
thereof).                                                                       

     12.11  Waiver and Other Action. This Agreement may be amended, modified, or
supplemented only by a written instrument executed by the parties against which 
enforcement of the amendment, modification, or supplement is sought.            

12.12  Severability. If any provision of this Agreement is held to be 
illegal, invalid, or unenforceable, such provision shall be fully severable, and
this Agreement shall be construed and enforced as if such illegal, invalid, or  
unenforceable provision were never a part hereof; the remaining provisions      
hereof shall remain in                                                          

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full force and effect and shall not be affected by the illegal, invalid, or     
unenforceable provision or by its severance (except to the extent such remaining
provisions constitute obligations of another party to this Agreement            
corresponding to the unenforceable provision); and in lieu of such illegal,     
invalid, or unenforceable provision, there shall be added automatically as part 
of this Agreement, a provision as similar in its terms to such illegal, invalid,
or unenforceable provision as may be possible and be legal, valid, and          
enforceable.                                                                    

 12.13  Knowledge. At any time there is a reference in a representation,
covenant or warranty of a party to this Agreement that is qualified by the      
knowledge of such party, the terms "knowledge" or "knows" or "known", or        
"belief" or "believes" shall mean (i) as to the Company and the Shareholder, the
knowledge or belief of the Shareholder or any of those certain individuals who  
have executed or will execute Noncompetition Agreements pursuant to Section 5.3,
and (ii) as to Tyler, the knowledge or belief of its Chairman of the Board,     
Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Louis
A. Waters, or James E. Russell.                                                 

   IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.                                           

                         TYLER CORPORATION

                                  By: /s/ C. A. RUNDELL, JR.
                                              ----------------------------------
                                             C. A. Rundell, Jr., President and
                                   Chief Executive Officer

                                  T1 ACQUISITION CORPORATION

                                  By: /s/ C. A. RUNDELL, JR.
                                              ----------------------------------
                                        C.A. Rundell, Jr., President

                                      BUSINESS RESOURCES CORPORATION

                                By: /s/ WILLIAM D. OATES
                                              ----------------------------------
                                       William D. Oates, President

                                /s/ WILLIAM D. OATES
                                              ----------------------------------
                                          William D. Oates, Individually

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                                                                      APPENDIX B

AMENDED AND RESTATED

AGREEMENT AND PLAN OF MERGER

AMONG 

TYLER CORPORATION,

T2 ACQUISITION CORPORATION, 

THE SOFTWARE GROUP, INC.

BRIAN B. BERRY

AND 

GLENN A. SMITH

DATED AS OF DECEMBER 29, 1997 

AND EFFECTIVE AS OF 

OCTOBER 8, 1997 

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TABLE OF CONTENTS 

                                                                [Download Table]
                                                                        
                              ARTICLE 1                                 
                              THE MERGER                                
 1.1  The Merger..................................................   B-6
 1.2  Closing.....................................................   B-6
 1.3  Effective Time..............................................   B-6
 1.4  Effects of the Merger.......................................   B-6
 1.5  Articles of Incorporation; Bylaws...........................   B-6
 1.6  Directors and Officers......................................   B-7
 1.7  Conversion of Securities; Exchange; Fractional Shares.......   B-7
 1.8  Adjustments to Prevent Dilution.............................   B-8
 1.9  Taking of Necessary Action; Further Action..................   B-8

                              ARTICLE 2                                 
             REPRESENTATIONS AND WARRANTS OF THE COMPANY                
                         AND THE SHAREHOLDERS                           
 2.1  Organization and Good Standing of Company...................   B-9
 2.2  No Company Subsidiaries.....................................   B-9
 2.3  No Other Investments........................................   B-9
 2.4  Foreign Qualification.......................................   B-9
 2.5  Power and Authority to Conduct Business.....................   B-9
 2.6  Authority to Consummate Merger..............................   B-9
 2.7  Binding Effect..............................................   B-9
 2.8  Compliance with Other Instruments...........................  B-10
 2.9  Capitalization of Company...................................  B-10
2.10  [Intentionally Omitted].....................................  B-10
2.11  [Intentionally Omitted].....................................  B-10
2.12  Company Financial Statements................................  B-11
2.13  Absence of Certain Changes..................................  B-11
2.14  No Material Undisclosed Liabilities.........................  B-12
2.15  Tax Liabilities.............................................  B-12
2.16  Title to Properties.........................................  B-13
2.17  Condition of Tangible Assets................................  B-14
2.18  Accounts Receivable.........................................  B-14
2.19  Inventories.................................................  B-14
2.20  Patents, Trademarks, and Copyrights.........................  B-14
2.21  Contracts...................................................  B-15
2.22  Litigation and Claims.......................................  B-16
2.23  Judgments, Decrees, and Orders in Restraint of Business.....  B-16
2.24  No Violation of Any Instrument..............................  B-16
2.25  Compliance With Laws........................................  B-17
2.26  Compensation and Benefit Plans..............................  B-17
2.27  Labor Relations.............................................  B-18
2.28  Adequate Insurance..........................................  B-18
2.29  Contracts with Affiliates and Others........................  B-18
2.30  Revenue Recognition.........................................  B-18
2.31  Certain Fees................................................  B-19
2.32  Environmental Matters.......................................  B-19
2.33  Accuracy of Information Furnished...........................  B-19

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ARTICLE 3       
REPRESENTATIONS AND WARRANTIES OF TYLER       
3.1  Organization and Good Standing of Tyler.....................  B-20   
3.2  Foreign Qualification.......................................  B-20   
3.3  Power and Authority to Conduct Business.....................  B-20   
3.4  Authority to Consummate Merger..............................  B-20   
3.5  Binding Effect..............................................  B-20   
3.6  Compliance with Other Instruments...........................  B-20   
3.7  Capitalization of Tyler.....................................  B-21   
3.8  Commission Filings; Financial Statements....................  B-21   
3.9  Absence of Certain Changes..................................  B-22   
3.10  No Material Undisclosed Liabilities.........................  B-22    
3.11  Litigation and Government Claims............................  B-22    
3.12  No Violation of Any Instrument..............................  B-22    
3.13  Certain Fees................................................  B-23    
3.14  No Interim Operations of Sub................................  B-23    
3.15  Accuracy of Information Furnished...........................  B-23    

ARTICLE 4       
JOINT COVENANTS OF THE COMPANY, THE SHAREHOLDERS AND TYLER      
4.1  Access; Confidentiality.....................................  B-23   
4.2  Notice of any Material Change...............................  B-24   
4.3  Monthly Financial Statements................................  B-24   
4.4  Antitrust Notification......................................  B-24   
4.5  Tax Matters.................................................  B-24   
4.6  Cooperation Pending Closing.................................  B-26   

ARTICLE 5       
COVENANTS OF THE COMPANY AND THE SHAREHOLDERS       
5.1  Conduct of Business Prior to Closing Date...................  B-26   
5.2  Employment Agreement........................................  B-27   
5.3  Noncompetition Agreements...................................  B-27   
5.4  Agreement Not to Negotiate..................................  B-27   
5.5  Accuracy of Information Furnished...........................  B-27   
5.6  Regulation S-X Financial Statements.........................  B-27   
5.7  Termination of Shareholders Agreement.......................  B-28   
5.8  Pre-Closing Bonuses.........................................  B-28   
5.9  Form of Merger..............................................  B-28   

ARTICLE 6       
COVENANTS OF TYLER      
6.1  Conduct Prior to Closing Date...............................  B-28   
6.2  Proxy Statement.............................................  B-28   
6.3  Meetings of Stockholders....................................  B-28   
6.4  Stock Exchange Listing......................................  B-28   
6.5  Guaranties of Company Obligations...........................  B-29   
6.6  Other Tyler Obligations.....................................  B-29   
6.7  Company Indemnification Obligations.........................  B-29   
6.8  Agreements Regarding Stock Options..........................  B-30   
6.9  Release of Shareholder Guaranties...........................  B-30   

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ARTICLE 7       
JOINT CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS       
7.1  HSR Act.....................................................  B-30   
7.2  Absence of Litigation.......................................  B-30   

ARTICLE 8       
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY      
AND THE SHAREHOLDERS      
8.1  Compliance..................................................  B-30   
8.2  Representations and Warranties..............................  B-31   
8.3  Opinion.....................................................  B-31   
8.4  No Material Adverse Change..................................  B-31   
8.5  Financing...................................................  B-31   
8.6  Certificates................................................  B-31   

ARTICLE 9       
CONDITIONS PRECEDENT TO OBLIGATIONS OF TYLER      
9.1  Compliance..................................................  B-31   
9.2  Representations and Warranties..............................  B-31   
9.3  Securities Law Compliance...................................  B-31   
9.4  Opinions....................................................  B-32   
9.5  No Material Adverse Change..................................  B-32   
9.6  Consents to Transaction.....................................  B-32   
9.7  Financing...................................................  B-32   
9.8  Noncompetition Agreements...................................  B-32   
9.9  Business Resources Corporation..............................  B-32   
9.10  Stockholder Approval........................................  B-32    
9.11  Certificates................................................  B-32    

ARTICLE 10      
SECURITIES LAW REGISTRATION AND COMPLIANCE      
10.1  Securities Law Compliance; Restrictions on Shares...........  B-32    
10.2  Piggyback Registration......................................  B-33    
10.3  Registration Procedures.....................................  B-33    
10.4  Expenses....................................................  B-34    
10.5  Indemnification.............................................  B-34    
10.6  No Transferability of Registration Rights...................  B-36    

ARTICLE 11      
INDEMNIFICATION AND REMEDIES      
11.1  Indemnification by the Shareholders Based on Agreement......  B-36    
11.2  Indemnification by Tyler Based on Agreement.................  B-36    
11.3  Customer Claims.............................................  B-36    
11.4  Claims Limitations..........................................  B-37    
11.5  Maximum Liability...........................................  B-38    
11.6  Equitable Remedies..........................................  B-38    
11.7  Remedies of the Surviving Corporation.......................  B-38    
11.8  Costs of Defense............................................  B-38    

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ARTICLE 12      
MISCELLANEOUS       
12.1  Breach Discovered Prior to Closing..........................  B-39    
12.2  Termination.................................................  B-39    
12.3  Expenses....................................................  B-40    
12.4  Disclosure Schedules........................................  B-40    
12.5  Entire Agreement............................................  B-40    
12.6  Survival....................................................  B-40    
12.7  Counterparts................................................  B-40    
12.8  Notices.....................................................  B-41    
12.9  Successors and Assigns......................................  B-41    
12.10  Governing Law...............................................  B-41     
12.11  Waiver and Other Action.....................................  B-41     
12.12  Severability................................................  B-41     
12.13  Knowledge...................................................  B-42     

ANNEX I  Shareholders and Optionholders.............................  B-44      

                                                                [Download Table]
                                                                 
EXHIBITS                                                         
  Exhibit                                                        
     A     Surviving Corporation Directors and Officers          
  Exhibit                                                        
     B     Employment and Noncompetition Agreement (Shareholders)

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AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER 

    THIS AMENDED AND RESTATED AGREEMENT, dated as of the 29th day of December,
1997 and effective as of the 8th day of October, 1997, is entered into by and   
among Tyler Corporation, a Delaware corporation ("Tyler"), T2 Acquisition       
Corporation, a Texas corporation and wholly-owned subsidiary of Tyler ("Sub"),  
The Software Group, Inc., a Texas corporation, (the "Company"), Brian B. Berry  
and Glenn Smith (each, a "Shareholder" and collectively, the "Shareholders").   

WITNESSETH: 

     WHEREAS, subject to and in accordance with the terms and conditions of this
Agreement, the respective Boards of Directors of Tyler, Sub and the Company, and
Tyler as sole shareholder of Sub, have approved the merger of Sub with and into 
the Company (the "Merger"), whereby all the issued and outstanding shares of    
common stock, without par value, of the Company (the "Company Common Stock") not
owned directly or indirectly by the Company will be converted into the right to 
receive in the aggregate $12,000,000 in cash and 2,000,000 shares of common     
stock, par value $0.01 per share, of Tyler ("Tyler Common Stock"), as provided  
herein;                                                                         

  WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the      
consummation of the Merger;                                                     

NOW, THEREFORE, in consideration of the premises and of the mutual    
representations, warranties and covenants herein contained, the parties hereto  
hereby agree as follows:                                                        

ARTICLE 1 

THE MERGER

     1.1  The Merger. Subject to and in accordance with the terms and conditions
of this Agreement and in accordance with the Texas Business Corporation Act (the
"TBCA"), at the Effective Time (as defined in Section 1.3) Sub shall be merged  
with and into Company. As a result of the Merger, the separate corporate        
existence of the Sub shall cease and Company shall continue as the surviving    
corporation (sometimes referred to herein as the "Surviving Corporation") and   
shall succeed to and assume all of the rights and obligations of the Company in 
accordance with the TBCA.                                                       

     1.2  Closing. The closing of the Merger (the "Closing") shall take place at
the offices of Gardere & Wynne, L.L.P., 1600 Elm Street, Suite 3000, Dallas,    
Texas 75201 as soon as practicable after the satisfaction or waiver of the      
conditions set forth in Article V or at such other time and place and on such   
other date as Tyler and the Company shall agree; provided, that the closing     
conditions set forth in Article V shall have been satisfied or waived at or     
prior to such time. The date on which the Closing occurs is herein referred to  
as the "Closing Date."                                                          

1.3  Effective Time. On the Closing Date, or as soon as practicable   
thereafter, the Company and Sub will cause Articles of Merger (the "Articles of 
Merger") to be filed with the Secretary of State of the State of Texas as       
provided in Article 5.04 of the TBCA. The Merger will become effective at the   
time that the Articles of Merger have been filed with the Secretary of State of 
the State of Texas or at such other time specified in the Articles of Merger as 
the effective time (the "Effective Time").                                      

    1.4  Effects of the Merger. The Merger shall have the effects set forth in
the applicable provisions of the TBCA.                                          

    1.5  Articles of Incorporation; Bylaws. The Articles of Incorporation (the
"Articles") and Bylaws (the "Bylaws") of the Company, as in effect immediately  
prior to the Effective Time, shall be the articles of incorporation and bylaws  
of the Surviving Corporation and thereafter shall continue to be its articles of
incorporation and bylaws until amended as provided therein and under the TBCA.  

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    1.6  Directors and Officers. The persons specified as directors on Exhibit
A hereto shall be the initial directors of the Surviving Corporation, each to   
hold office in accordance with the Articles and Bylaws, and the persons         
specified as officers on Exhibit A hereto shall be the initial officers of the  
Surviving Corporation, in each case until their respective successors are duly  
elected or appointed and qualified in accordance with the Articles and Bylaws.  

    1.7  Conversion of Securities; Exchange; Fractional Shares. Subject to the
terms and conditions of this Agreement, at the Effective Time, by virtue of the 
Merger and without any action on the part of the Company, Sub or their          
Shareholder:                                                                    

     (a) Each share of the Company Common Stock issued and outstanding
immediately prior to the Effective Time, other than any shares of the 
  Company Common Stock to be canceled pursuant to Section 1.7(b), shall be
     converted, subject to the provisions of this Section 1.7, into the right to
 receive, without interest, $5.7943 in cash and 0.965717 shares of Tyler
   Common Stock (collectively, the "Merger Consideration"); provided that no
fractional shares of Tyler Common Stock shall be issued, and, in lieu 
    thereof, a cash payment shall be made in accordance with the procedure set
forth in Section 1.7(h) hereof.                                       

      (b) Each share of Company Common Stock held in the treasury of the
  Company and each share of Company Common Stock held by Sub, Tyler or any
direct or indirect wholly-owned subsidiary of Tyler, or the Company   
    immediately prior to the Effective Time shall be canceled and extinguished
   at the Effective Time without any conversion thereof and no payment shall
be made with respect thereto.                                         

        (c) Each option outstanding at the Effective Time to purchase shares
     of Company Common Stock (a "Stock Option") granted under (i) the 1988 Stock
     Option Plan for Software Group, Inc., as amended (the "Company Stock Option
    Plan"), or (ii) any other stock plan or agreement of the Company, which by
  its terms is not extinguished in the Merger, shall be exercised prior to
 the Closing and the holders of any such Stock Options agree to exercise
such Stock Options at or prior to the Closing.                        

     (d) Each share of common stock, par value $1.00 per share, of Sub
     issued and outstanding immediately prior to the Effective Time shall at the
Effective Time be converted into one validly issued, fully paid and   
nonassessable share of common stock of the Surviving Corporation.     

        (e) At the Effective Time, each holder of an outstanding certificate
that prior thereto represented shares of Company Common Stock shall be
  entitled to receive, upon surrender to the Surviving Corporation of such
  certificate or certificates for cancellation and subject to any required
     withholding of taxes, a certificate or certificates representing the number
     of whole shares of Tyler Common Stock (of such denominations and registered
    in such names as such holder may request) into which the shares of Company
Common Stock so surrendered shall have been converted. Each holder of 
shares of Company Common Stock who would otherwise be entitled to a   
fraction of a share of Tyler Common Stock shall, upon surrender to the
  Surviving Corporation of the certificates representing shares of Company
   Common Stock held by such holder, be paid an amount in cash in accordance
with the provisions of Section 1.7(h). Until so surrendered, each     
     outstanding certificate that prior to the Effective Time represented shares
   of Company Common Stock shall be deemed from and after the Effective Time
 to evidence the right to receive that amount of cash and that number of
    full shares of Tyler Common Stock into which such shares of Company Common
    Stock shall have been converted pursuant to this Section 1.7, and any cash
in lieu of fractional shares of Tyler Common Stock, subject to any of 
required withholding of taxes. No interest shall be paid on the cash  
     payable upon surrender of the certificate or certificates evidencing shares
     of Company Common Stock. Unless and until any such outstanding certificates
representing shares of Company Common Stock shall be surrendered, no  
 dividends or other distributions declared and payable to the holders of
Tyler Common Stock on or after the Effective Time shall be paid to the
    holders of such outstanding certificates which prior to the Effective Time
   represented shares of Company Common Stock; provided, however, that, upon
 surrender and exchange of such outstanding certificates, there shall be
paid to the record holders of the certificates issued and exchanged   
therefor the amount, without interest thereon, of dividends and other 
distributions, if any, that theretofore                               

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   were declared and became payable since the Effective Time with respect to
 the number of full shares of Tyler Common Stock issued to such holders.

          (f) The cash and shares of Tyler Common Stock into which the shares of
     Company Common Stock shall have been converted pursuant to this Section 1.7
shall be issued in full satisfaction of all rights pertaining to such 
converted shares of Company Common Stock.                             

    (g) If any certificate for shares of Tyler Common Stock is to be
  issued in a name other than that in which the certificate surrendered in
  exchange therefor is registered, it shall be a condition of the issuance
    thereof that the certificate so surrendered shall be properly endorsed and
   otherwise in proper form for transfer and that the person requesting such
     exchange shall have paid to Tyler or the Surviving Corporation any transfer
or other taxes required by reason of the issuance of a certificate for
    shares of Tyler Common Stock in any name other than that of the registered
   holder of the certificate surrendered, or established to the satisfaction
of Tyler or its transfer agent that such tax has been paid or is not  
payable.                                                              

         (h) No fraction of a share of Tyler Common Stock shall be issued, but
 in lieu thereof each holder of shares of Company Common Stock who would
     otherwise be entitled to a fraction of a share of Tyler Common Stock shall,
upon surrender to the Surviving Corporation of the certificate or     
   certificates representing the shares of Company Common Stock held by such
    holder, be paid an amount in cash equal to the value of such fraction of a
  share of Tyler Common Stock based upon the closing price of one share of
 Tyler Common Stock on the New York Stock Exchange, Inc. ("NYSE") on the
    last trading day prior to the Effective Time. No interest shall be paid on
 such amount. All shares of Company Common Stock held by a record holder
     shall be aggregated for purposes of computing the number of shares of Tyler
Common Stock to be issued pursuant to this Section 1.7.               

       (i) At the Closing, Tyler shall provide each holder of certificates
which prior to the Effective Time represented shares of Company Common
    Stock a letter of transmittal and other documentation enabling such holder
   to effect the exchange of stock certificates as contemplated by Article 1
of this Agreement.                                                    

      (j) Neither Tyler, the Surviving Corporation, nor any other person
    shall be liable to any former holder of shares of Company Common Stock for
   any amount properly delivered to a public official pursuant to applicable
abandoned property, escheat or similar laws.                          

        (k) In the event any certificate formerly representing shares of the
  Company Common Stock shall have been lost, stolen or destroyed, upon the
     making of an affidavit of that fact by the person claiming such certificate
    to be lost, stolen or destroyed and, if required by Tyler or the Surviving
  Corporation, the posting by such person of a bond in customary amount as
     indemnity against any claim that may be made against Tyler or the Surviving
 Corporation with respect to such certificate, the Surviving Corporation
  shall deliver in exchange for such lost, stolen or destroyed certificate
the cash and shares of Tyler Common Stock that would be deliverable   
pursuant to this Article 1 upon due surrender of the shares of Company
 Common Stock represented by such lost, stolen or destroyed certificate.

     1.8  Adjustments to Prevent Dilution. In the event that the Company changes
the number of shares of the Company Common Stock or securities convertible or   
exchangeable into or exercisable for shares of the Company Common Stock, or     
Tyler changes the number of shares of Tyler Common Stock or securities          
convertible or exchangeable into or exercisable for shares of Tyler Common      
Stock, issued and outstanding prior to the Effective Time as a result of a      
reclassification, stock split (including a reverse split or combination), stock 
dividend or distribution, recapitalization, subdivision, or other similar       
transaction, the Merger Consideration shall be correspondingly adjusted.        

   1.9  Taking of Necessary Action; Further Action. The parties hereto shall
take all such reasonable and lawful action as may be necessary or appropriate in
order to effectuate the Merger as promptly as possible. If at any time after the
Effective Time any further action is necessary or desirable to carry out the    
purposes of this Agreement and to vest the Surviving Corporation with full      
right, title and possession to all assets, property,                            

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rights, privileges, powers and franchises of the Company or Sub, such           
corporations shall direct their respective officers and directors to take, and  
the Shareholders shall take, all such lawful and necessary action.              

ARTICLE 2 

REPRESENTATIONS AND WARRANTIES OF THE 
COMPANY AND THE SHAREHOLDERS

The Company and the Shareholders jointly and severally represent and  
warrant to Tyler and Sub as follows:                                            

2.1  Organization and Good Standing of Company. The Company is a      
corporation duly organized, validly existing, and in good standing under the    
laws of the State of Texas.                                                     

   2.2  No Company Subsidiaries. The Company is not, and has never been, the
record or beneficial owner, directly or indirectly, of 50% or more of the       
capital stock of any corporation.                                               

   2.3  No Other Investments. The Company does not own, and has never owned,
any capital stock of any other corporation or any equity, profit sharing,       
participation, or other interest of any type in any partnership, joint venture, 
and other entity.                                                               

     2.4  Foreign Qualification. The Company is duly qualified or licensed to do
business as a foreign corporation and in good standing in those jurisdictions   
set forth in Section 2.4 of the schedule delivered by the Company concurrently  
with the execution of this Agreement (the "Company Disclosure Schedule"). The   
Company is duly qualified or licensed to do business as a foreign corporation in
every jurisdiction where the failure so to qualify could have a material adverse
effect on the businesses, operations, assets or financial condition of the      
Company. For purposes of this Section 2.4, no material adverse effect shall be  
deemed to have occurred as a result of non-payment of state or local franchise  
taxes not exceeding $37,500 in the aggregate.                                   

     2.5  Power and Authority to Conduct Business. The Company has the corporate
power and authority, and possesses all licenses and permits required by         
governmental authorities, to own, lease, and operate their properties and assets
and to carry on its business as currently being conducted, except where the     
failure to possess such license or permit would not have a material adverse     
effect on the businesses, operations, assets or financial condition of the      
Company.                                                                        

  2.6  Authority to Consummate Merger. The Company has the corporate power
and authority to execute, deliver and perform its obligations under this        
Agreement and the other agreements or documents executed or required to be      
executed by the Company in connection with this Agreement, and the execution,   
delivery, and performance by the Company of this Agreement and the other        
documents executed or required to be executed by the Company in connection with 
this Agreement have been duly authorized by all necessary corporate action. Each
Shareholder has the capacity and authority to execute, deliver and perform his  
obligations under this Agreement, and the other agreements or documents executed
or required to be executed by him in connection herewith.                       

    2.7  Binding Effect. This Agreement and the other agreements and documents
executed or required to be executed by the Company or the Shareholders in       
connection with this Agreement have been or will have been duly executed and    
delivered by the Company or the Shareholders, as appropriate, and are or will   
be, when executed and delivered, the legal, valid, and binding obligations of   
the Company or the Shareholders executing the same, enforceable in accordance   
with their terms, except that:                                                  

         (a) enforceability may be limited by bankruptcy, insolvency, or other
similar laws affecting creditors' rights;                             

          (b) the availability of equitable remedies may be limited by equitable
principles of general applicability; and                              

      (c) rights to indemnification under Section 10.5 may be limited by
considerations of public policy.                                      

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    2.8  Compliance with Other Instruments. Except as disclosed in Section 2.8
of the Company Disclosure Schedule, neither the execution and delivery by the   
Company or the Shareholders of this Agreement, or the other agreements or       
documents executed or required to be executed by the Company or the Shareholders
in connection herewith, nor the consummation by the Company or the Shareholders 
of the transactions contemplated hereby and thereby, will (i) conflict with the 
articles of incorporation or bylaws of the Company; (ii) assuming satisfaction  
of the requirements set forth in clause (iii) below, violate any provision of   
law applicable to the Company; (iii) except for (A) requirements arising out of 
the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), and   
(B) the filing of articles of merger in accordance with the TBCA, require any   
consent, authorization, permit, license or approval of, or declaration,         
registration or filing with or notice to, any person or governmental body or    
authority, domestic or foreign, under any provision of law applicable to the    
Company; or (iv) require any consent, approval or notice under, violate, breach,
be in conflict with, or constitute a default (or an event that, with notice or  
lapse of time or both, would constitute a default) under, or permit the         
termination or the acceleration of maturity of, or result in the imposition of  
any lien, claim, or encumbrance upon any property or asset of the Company or    
either Shareholder, pursuant to any note, bond, indenture, mortgage, deed of    
trust, evidence of indebtedness, loan or lease agreement, or other agreement or 
instrument (including with customers) listed or required to be listed in Section
2.21 of the Company Disclosure Schedule, or any judgment, order, injunction, or 
decree by which the Company or either Shareholder is bound, to which any of them
is a party, or to which any of their assets is subject, where any such failure  
to obtain any consent, approval or notice, or violation, breach, conflict or    
default would result in a material adverse effect on the businesses, operations,
assets or financial condition of the Company.                                   

2.9  Capitalization of Company.                                       

(a) The authorized capital stock of the Company is 5,000,000 shares of
Company Common Stock, of which 1,921,000 shares of Company Common Stock are     
issued and outstanding at the date hereof and 150,000 shares are subject to     
Stock Options. All of the issued and outstanding shares of Company Common Stock 
have been duly authorized and are validly issued, fully paid and nonassessable. 
There are and at the Closing will be no shares of the capital stock of the      
Company held in its treasury or in the treasury.                                

(b) At the Closing, each Shareholder will be the lawful record and    
beneficial owner of the shares of the Company Common Stock, set forth opposite  
such Shareholder's name on Annex I, free and clear of all liens, encumbrances,  
and claims of every kind, and the shares so owned by the Shareholders will      
constitute 93% of the issued and outstanding shares of the Company capital      
stock. Set forth on Annex I are the number of shares of Company Common Stock    
outstanding and Company Common Stock subject to options. Each Shareholder has   
the right to vote or direct the vote of his shares at his discretion on any     
matter submitted to a vote of the Company shareholders.                         

    (c) Except as disclosed in Section 2.9 of the Company Disclosure Schedule,
there are no voting trusts, shareholder agreements, or other voting arrangements
among the shareholders of the Company.                                          

    (d) Except as described in Section 2.9 of the Company Disclosure Schedule,
there presently is no outstanding subscription, contract, convertible or        
exchangeable security, option, warrant, call, or other right obligating the     
Company or any Shareholder to issue, sell, exchange, or otherwise dispose of, or
to purchase, redeem, or otherwise acquire, shares of, or securities convertible 
into or exchangeable for, capital stock of the Company; no such rights disclosed
in Section 2.9 of the Company Disclosure Schedule will remain outstanding at the
Closing. No shareholder of the Company is entitled to any preemptive right.     

2.10  [Intentionally Omitted].                                        

2.11  [Intentionally Omitted].                                        

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2.12  Company Financial Statements.                                   

   (a) The Company has delivered to Tyler true, correct, and complete copies
of the following financial statements of the Company (the "Company Financial    
Statements"), which are attached to Section 2.12 of the Company Disclosure      
Schedule:                                                                       

         (i) the audited balance sheets of the Company as of October 31, 1996,
1995 and 1994 and the related audited statements of operations,       
   stockholder's equity, and cash flows for the years then ended, with notes
thereto, prepared in accordance with United States generally accepted 
accounting principles, except as disclosed in the notes thereto; and  

         (ii) the unaudited balance sheet of the Company as of August 31, 1997
(the "Company Balance Sheet"), and the related unaudited statements of
  operations, stockholder's equity, and cash flows for the ten months then
ended, with notes thereto, prepared in accordance with United States  
    generally accepted accounting principles, except as disclosed in the notes
thereto.                                                              

The Company Financial Statements present fairly, in all material respects, the  
financial position of the Company as of the dates thereof and the results of    
operations and cash flows for the periods then ended, in conformity with        
generally accepted accounting principles applied, except as may be set forth in 
the notes thereto, on a consistent basis throughout such periods.               

(b) Since August 31, 1997, there has been no change in accounting     
principles applicable to, or methods of accounting utilized by the Company, and 
the books and records of Company have been and are being maintained in          
accordance with all applicable legal and accounting requirements and what the   
Shareholders believe in good faith to be good business practice, reflect only   
valid transactions, are complete and correct in all material respects, and      
accurately reflect in all material respects the basis for the financial position
and results of operations and cash flows of the Company set forth in the Company
Financial Statements.                                                           

2.13  Absence of Certain Changes. Since August 31, 1997 (or other date
indicated below), the Company has not (except as may be contemplated by this    
Agreement or as may result from the transactions contemplated by this           
Agreement):                                                                     

     (a) except as disclosed in Section 2.13 of the Company Disclosure
 Schedule, suffered any change in its businesses, results of operations,
    working capital, assets, liabilities, or financial condition or the manner
    of conducting its business other than changes that, individually or in the
aggregate, have not had a material adverse effect on the businesses,  
  operations, assets or condition (financial or otherwise) of the Company;

        (b) experienced a decline in the shareholder's equity of the Company
    from its shareholder's equity shown on the Company Balance Sheet at August
  31, 1997, determined using the same accounting principles applied in the
    preparation of the Company Financial Statements (but without giving effect
to the payment of pre-closing bonuses, if any, pursuant to Section 5.8
hereof);                                                              

     (c) except as disclosed in Section 2.13 of the Company Disclosure
   Schedule, suffered any damage or destruction to or loss of its assets not
    covered by insurance, or any loss of customers or suppliers, or terminated
  or lost the services of any key employee (including any employee who had
   agreed with the Company to maintain the confidentiality of proprietary or
technical information or know-how or to assign inventions, patents, or
   copyrights) that has had, or in the good faith belief of the Shareholders
     is likely to have, a material adverse effect on the businesses, operations,
assets, financial condition, or prospects of the Company;             

         (d) acquired or disposed of any material asset, or incurred, assumed,
guaranteed, endorsed, paid, or discharged any material indebtedness,  
 liability, or obligation, or subjected or permitted to be subjected any
   material amount of assets to any lien, claim, or encumbrance of any kind,
except in the ordinary course of business or pursuant to agreements in
force at the date of this Agreement;                                  

          (e) forgiven, compromised, canceled, released, waived, or permitted to
     lapse any material rights or claims, except as disclosed in Section 2.13 of
the Company Disclosure Schedule;                                      
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        (f) entered into or terminated any material agreement or commitment,
    or agreed or made any changes in material leases or agreements, other than
renewals or extensions thereof and leases, agreements, and commitments
   entered into, terminated, or modified in the ordinary course of business;

      (g) written up, written down, or written off the book value of any
material amount of assets, except as disclosed in Section 2.13 of the 
Company Disclosure Schedule;                                          

(h) declared, paid, or set aside for payment any dividend or
distribution with respect to its capital stock;                       

     (i) except as set forth in Section 2.13 of the Company Disclosure
    Schedule, redeemed, purchased, or otherwise acquired, or sold, granted, or
    otherwise disposed of, directly or indirectly, any of its capital stock or
  securities or any rights to acquire such capital stock or securities, or
agreed to changes in the terms and conditions of any such rights;     

     (j) except as set forth in Section 2.13 of the Company Disclosure
Schedule, paid compensation, fees, bonuses or other payments to any   
    Shareholder or his family members or any of his affiliates, other than the
   base salary of each Shareholder; or materially increased the compensation
   of or paid any bonus to any other employee or contributed to any employee
benefit plan other than in accordance with policies, practices or     
requirements established and in effect on October 31, 1996;           

(k) Entered into any employment, compensation, or collective
   bargaining agreement with any person or group or consulting agreement not
   identified in Section 2.13 of the Company Disclosure Schedule, other than
in the ordinary course of business;                                   

         (l) Entered into, adopted, or materially amended any employee benefit
plan; or                                                              

     (m) Entered into any other material commitment or transaction not
 disclosed elsewhere herein or in the Company Disclosure Schedule, other
than in the ordinary course of business.                              

    2.14  No Material Undisclosed Liabilities. To the knowledge of the Company
or the Shareholders, there is no liability or obligation of the Company of any  
nature, whether absolute, accrued, contingent, or otherwise, other than:        

          (a) the liabilities and obligations that are fully reflected, accrued,
  or reserved against on the Company Balance Sheet, for which the reserves
are appropriate and reasonable, or incurred in the ordinary course of 
business and consistent with past practices since August 31, 1997;    

       (b) the loss contingencies set forth in Section 2.14 of the Company
Disclosure Schedule;                                                  

          (c) contractual liabilities or obligations of a nature not required to
be disclosed on a balance sheet prepared in accordance with generally 
  accepted accounting principles, but which, if material, are disclosed in
Section 2.14 of the Company Disclosure Schedule; and                  

          (d) other liabilities and loss contingencies which are not material in
   the aggregate to the business, operations, assets or condition (financial
or otherwise) of the Company.                                         

  The Company is not a signatory to, and is not in any manner a guarantor,
endorser, assumptor or otherwise primary or secondarily liable for or           
responsible for the payment of, any notes payable other than those set forth in 
Section 2.21 of the Company Disclosure Schedule.                                

   2.15  Tax Liabilities. The Company has filed all material federal, state,
county, local, and foreign tax returns and reports required to be filed by them,
including those with respect to income, payroll, property, withholding, social  
security, unemployment, franchise, excise, use and sales taxes, and has either  
paid in full all taxes that have become due as reflected on any such return or  
report and any interest and penalties with respect thereto or, as of August 31, 
1997, it has fully accrued on its books or has established adequate reserves for
all taxes payable but not yet due, except that at August 31, 1997 the unrecorded
contingent liability of the Company with respect to payroll, withholding, social
security, unemployment, franchise, property, sales, use and excise taxes did not
exceed $37,500 in the aggregate for all such taxes. The total of all payments   
made in 1996 and in 1997 for taxes, interest and penalties of the Company for   
periods ended prior to November 1, 1996                                         
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have not exceeded the accrued liability for such items shown on the Company     
Financial Statements as of August 31, 1997 for periods ended October 31, 1996;  
the Company has not, subsequent to October 31, 1996, accrued or set aside any   
reserves on its books and records for any taxes, interest or penalties for any  
period ended prior to November 1, 1996 nor has the Company made any payments in 
1996 or 1997 of taxes, interest or penalties for periods ended prior to November
1, 1996 that were not reflected in the accrued liability therefor (including    
deferred taxes) shown on the Company Financial Statements as of August 31, 1997 
for periods ended October 31, 1996. There are no reserves (other than for       
deferred taxes) reflected in the Company Financial Statements as of August 31,  
1997 for periods ended October 31, 1996 for taxes, interest or penalties in     
excess of those shown to be due on any tax returns that have been filed for any 
periods then ended. Except as disclosed on Section 2.15 of the Company          
Disclosure Schedule, neither the Internal Revenue Service nor any other taxing  
authority has audited or is in the process of auditing the tax returns and      
reports of the Company, and no claim for additional taxes, interest, or         
penalties for any fiscal year is pending. The Company has delivered to Tyler    
true, complete and correct copies of (i) all federal and state income or        
franchise tax returns for the Company for all periods ending on and after       
October 31, 1994 and (ii) relevant portions of income and franchise tax         
examination reports, statements of deficiencies, closing or other agreements    
received by, assessed against or agreed to by the Company, relating to such     
taxes, since October 31, 1994, if any. No extension or waiver of any statute of 
limitations has been requested of or granted by the Company with respect to any 
tax year, and no extension or waiver of time within which to file any tax return
has been requested by or granted to the Company except with respect to tax      
returns not yet filed but otherwise due. No unsatisfied deficiency, delinquency,
or default for any tax, assessment, or governmental charge has been claimed or  
assessed, or to the knowledge of the Company or the Shareholders, proposed      
against the Company, nor has the Company received notice of any such deficiency,
delinquency, or default, for any tax period. Neither the Company nor either     
Shareholder has any reason to believe that the Company has any material         
contingent income tax liabilities other than those reflected on the Company     
Balance Sheet and those arising in the ordinary course of business since the    
date thereof, and those arising as a result of the transactions contemplated    
hereby. The Company has not filed a consent under sec.341(f) of the Internal    
Revenue Code of 1986, as amended (the "Code"), concerning collapsible           
corporations. The Company has not made any material payments, is not obligated  
to make any material payments, and is not a party to any agreement that under   
certain circumstances could obligate it to make any material payments that will 
not be deductible under Code sec.280G. The Company is not a party to any tax    
allocation or sharing agreement. The Company (i) has not been a member of an    
affiliated group filing a consolidated federal income tax return and (ii) does  
not have any liability for the taxes of any person under Treasury Reg.          
sec.1.1502-6 (or any similar provision of state, local or foreign law) as a     
transferee or successor, by contract, or otherwise.                             

2.16  Title to Properties.                                            

(a) The Company owns no real property.                                

(b) Except as disclosed in Section 2.16(b) of the Company Disclosure  
Schedule and except as they have since been affected subsequent to August 31,   
1997 by transactions in the ordinary course of business and consistent with past
practices, and except for assets subject to financing leases required to be     
capitalized under generally accepted accounting principles which are reflected  
in the Company Balance Sheet or notes thereto, the Company has good and         
marketable title to the assets reflected in the Company Balance Sheet or        
otherwise on their books and records as being owned as of August 31, 1997, or   
purchased by it since August 31, 1997, and to the assets described in Section   
2.20 below and to the following assets whether or not reflected in the Company  
Balance Sheet or on such books and records:                                     

  The computer programs and applications software, in both object code and
source code form, and all documentation therefor (excluding operating systems   
software leased by or licensed to the Company) utilized by the Company in its   
business.                                                                       

    (c) The assets identified in subsection (b) above and the assets described
in Section 2.20 below are owned by or licensed to the Company free and clear of 
any lien, claim or encumbrance except those disclosed                           

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in the Company Balance Sheet or notes thereto or in Section 2.16(c) of the      
Company Disclosure Schedule and except for:                                     

       (i) Liens for taxes, assessments, or other governmental charges not
    yet delinquent, or the validity of which are being contested in good faith
by appropriate proceedings listed in Section 2.16(c) of the Company   
Disclosure Schedule;                                                  

         (ii) Statutory liens incurred in the ordinary course of business that
 are not yet delinquent, or the validity of which are being contested in
   good faith by appropriate proceedings described in Section 2.16(c) of the
Company Disclosure Schedule;                                          

          (iii) The rights of customers of the Company with respect to inventory
    or work in progress under purchase orders or contracts entered into by the
Company in the ordinary course of business;                           

         (iv) Liens, claims, or encumbrances consisting of leases of equipment
to customers entered into in the ordinary course of business;         

     (v) Liens, claims, or encumbrances described in real estate title
 insurance binders or commitments, or abstracts of title to real estate,
   furnished or to be furnished to Tyler in connection with the transactions
 contemplated hereby, unless Tyler objects to the same in writing within
five business days after receipt of such title documents;             

         (vi) Restrictions and constraints set forth in the license agreements
described in Section 2.20 of the Company Disclosure Schedule; and     

         (vii) Other liens, claims, or encumbrances that, in the aggregate, do
    not materially detract from the value of, or materially interfere with the
present use of, such assets.                                          

    (d) Except for those assets acquired since the date of the Company Balance
Sheet, all tangible properties and assets material to the present operations of 
the Company are reflected on the Company Balance Sheet and notes thereto in the 
manner and to the extent required by generally accepted accounting principles.  
Immediately after the Closing, the Company will own or lease or otherwise       
possess the rights to use all assets necessary to the conduct of the business   
conducted by the Company immediately before the Closing.                        

    2.17  Condition of Tangible Assets. Except as set forth in Section 2.17 of
the Company Disclosure Schedule, the tangible assets of the Company which are   
material to the business, operations, assets or financial condition of the      
Company, are in good condition and repair and, in the good faith belief of each 
Shareholder, are adequate for the uses to which they are being put in the       
ordinary course of their respective businesses.                                 

2.18  Accounts Receivable. To the knowledge of the Company or the     
Shareholders, all accounts receivable reflected in the Company Balance Sheet or 
arising since August 31, 1997 either have been collected or are enforceable and 
collectible claims not subject to any valid defense, offset, or credit, except  
to the extent of any reserves established for doubtful accounts in a manner     
consistent with such practices in prior periods and except as set forth in      
Section 2.18 of the Company Disclosure Schedule.                                

2.19  Inventories. The Company has no inventories.                    

     2.20  Patents, Trademarks, and Copyrights. Set forth in Section 2.20 of the
Company Disclosure Schedule is a true and correct description of:               

     (a) all material trademarks, trade names, service marks, patents,
     copyrights, and applications therefor and all license, royalty, assignment,
    and other similar agreements relating to the foregoing currently owned, in
whole or in part, by the Company;                                     

    (b) all material agreements relating to technology, know-how, or
  processes that the Company is licensed or authorized to use by others or
licenses or authorizes others to use; and                             

     (c) all material trademarks, trade names, service marks, patents,
copyrights, and applications therefor and other similar and intangible
intellectual property and all license, royalty, assignment, and       

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other similar agreements relating to the foregoing and all material   
agreements relating to technology, know-how, or processes used in     
connection with the business of the Company.                          

Except to the extent set forth in Section 2.20 of the Company Disclosure        
Schedule, the Company has, to the knowledge of the Company and each Shareholder,
the sole and exclusive right to use the patents, trademarks, trade names,       
copyrights, service marks, technology, know-how, and processes identified in    
such Section 2.20 without infringing or violating the rights of any other       
person, and to the knowledge of the Company and each Shareholder no consent of  
third parties will be required for the use thereof by the Company upon          
consummation of the Merger and there are no past due or delinquent license fees,
rents, royalties, or other charges that the Company is required or obligated to 
pay with respect to any of the foregoing. Except as disclosed in Section 2.20 of
the Company Disclosure Schedule, no claim has been asserted by any person to the
ownership of or right to use any such patent, trademark, trade name, copyright, 
service mark, technology, know-how, or process or challenging or questioning the
validity or effectiveness of any such license or agreement, and the Company     
knows of no valid basis for any such claim. To the knowledge of the Company and 
each Shareholder, except as disclosed in Section 2.20 of the Company Disclosure 
Schedule, each of the foregoing is valid and subsisting, has not been canceled, 
abandoned, or otherwise terminated, and, if applicable, has been duly issued or 
filed.                                                                          

2.21  Contracts. Set forth in Section 2.21 of the Company Disclosure  
Schedule are complete and accurate lists of the following contracts and         
commitments (including summaries of oral contracts) to which the Company is a   
party or bound:                                                                 

(a) Contracts with any labor union;                         

(b) Employee benefit plans or contracts;                    

  (c) Employment or similar contracts, including confidentiality
     agreements and agreements to assign inventions, patents and copyrights, and
     consulting agreements (other than those entered into in the ordinary course
of business);                                                         

    (d) Leases, whether as lessor or lessee, involving annual rental
payments in excess of $7,500, that are not terminable at will or upon 
notice of 30 days or less by the Company;                             

(e) Loan agreements, mortgages, indentures, instruments of  
  indebtedness or commitments involving indebtedness for borrowed money or
money loaned to others in excess of $7,500, but excluding intercompany
items;                                                                

     (f) Guaranty or suretyship, performance bond, indemnification, or
contribution agreements involving obligations in excess of $7,500, but
excluding intercompany items;                                         

    (g) Contracts with customers or suppliers that involve aggregate
payments to or by the Company of more than $15,000, and that are not  
terminable at will or upon notice of 90 days or less by the Company;  

        (h) Distribution, marketing, dealership, sales, or agency agreements
   material to the Company that are not terminable at will or upon notice of
30 days or less by the Company;                                       

     (i) Joint venture, partnership, or other agreements evidencing an
ownership interest or a participation in or sharing of profits;       

   (j) Contracts containing noncompetition covenants, covenants to
  register securities, or negative or restrictive financial covenants that
are not terminable at will or upon notice of 30 days or less by the   
Company;                                                              

        (k) Voting agreements relating to securities of the Company (whether
or not the Company is a party thereto;                                

         (l) Insurance policies involving annual premium payments of more than
$750;                                                                 

(m) Powers of attorney; and                                 

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        (n) Contracts between the Company and any of the Shareholders, their
spouses or any affiliates or relatives thereof; and                   

      (o) Other contracts not made in the ordinary course of business or
   that, in the reasonable judgment of the Shareholders, are material to the
businesses, operations, assets, or financial condition of the Company.

No contract or commitment listed in Section 2.21 of the Company Disclosure      
Schedule has been amended or modified or the rights and obligations evidenced   
thereby otherwise affected in a manner materially adverse to the Company, except
by an instrument which is also included in such listing, and each contract or   
commitment, as so amended, modified or affected, contains all material          
provisions with respect to the subject matter thereof. The Company and the      
Shareholders have furnished or made available to Tyler accurate and complete    
copies of all of the contracts, commitments or instruments listed in Section    
2.21 of the Company Disclosure Schedule. Except as set forth in Section 2.21 of 
the Company Disclosure Schedule or with respect to contracts not material to the
businesses, operations, assets or financial condition of the Company, (i) to the
knowledge of the Company and the Shareholders, all such contracts are valid,    
binding, subsisting, and enforceable in all material respects; (ii) to the      
knowledge of the Company and the Shareholders and in their good faith belief the
Merger will not affect the continuance in full force and effect of such         
contracts; and (iii) there is no material dispute among the parties to any such 
contract and no material penalty has been incurred with respect thereto. Neither
the Company nor any Shareholder has received notice of any plan or intention of 
any other party to any such contract or agreement to exercise any right to      
cancel or terminate any such contract or agreement, and neither the Company nor 
any Shareholder knows of any fact that would justify the exercise of such right.
Neither the Company nor any Shareholder currently contemplates, person or entity
currently contemplates, any amendment or change to any of the contracts or      
agreements referred to in Section 2.21 of the Company Disclosure Schedule.      
Except as disclosed in Section 2.21 of the Company Disclosure Schedule, none of 
the Company's customers or suppliers, that during the fiscal year ended October 
31, 1996 accounted for as much as 2% of consolidated sales or purchases of the  
Company, has refused, or communicated that it will or may refuse, to purchase or
supply goods or services, as the case may be, or has communicated that it will  
or may substantially reduce the amount of goods or services that it is willing  
to purchase from, or sell to, the Company after the date hereof.                

 2.22  Litigation and Claims. Except as described in Section 2.22 of the
Company Disclosure Schedule, neither the Company nor any Shareholder is a party 
to, and the businesses or assets of the Company are not the subject of or       
affected by, any pending or to the knowledge of the Company or any Shareholder, 
threatened suit, claim, action, or litigation with any party or any             
administrative, arbitration, or other governmental proceeding, investigation, or
inquiry, or any pending change in any regulations, statutes or ordinances, which
would, severally or in the aggregate, have a material adverse effect on the     
businesses, results of operations, assets, or the condition (financial or       
otherwise) of the Company. Except as described in Section 2.22 of the Company   
Disclosure Schedule, to the knowledge of the Company or any Shareholder, no     
suit, claim, action or demand is currently pending, has been made or filed, or  
is or has been threatened or contemplated by any person or entity, and there    
exists no judgment or order (whether or not the Company is a party to any of the
foregoing) regarding or affecting the ownership, disclosure, copying, possession
or utilization by the Company of the assets reflected in the books and records  
of the Company.                                                                 

    2.23  Judgments, Decrees, and Orders in Restraint of Business. The Company
is not a party to or subject to any judgment, order, or decree entered in any   
suit or proceeding brought by any governmental agency or by any other person    
enjoining it in respect of any business practice or the acquisition of any      
property or the conduct of its business.                                        

   2.24  No Violation of Any Instrument. Except as disclosed in Section 2.24
of the Company Disclosure Schedule, the Company is not in violation of or       
default under nor, to the knowledge of the Company or any Shareholder, has any  
event occurred that, with or without the giving of notice, lapse of time or the 
occurrence of any other event, would constitute a violation of or default under,
or permit the termination or the acceleration of maturity of, or result in the  
imposition of a lien, claim, or encumbrance upon any property or asset of the   
Company pursuant to, the articles or certificate of incorporation or bylaws of  
the Company or any                                                              
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note, bond, indenture, mortgage, deed of trust, evidence of indebtedness, loan  
or lease agreement, or other agreement or instrument (including with customers) 
listed or required to be listed in Section 2.21 of the Company Disclosure       
Schedule, or any judgment, order, injunction, or decree, to which it is a party,
by which it is bound, or to which any of its assets is subject, which would have
a material adverse effect on the businesses, operations, assets or financial    
condition of the Company.                                                       

     2.25  Compliance With Laws. The Company is substantially in compliance with
all laws applicable to their businesses, where failure so to comply would have a
material adverse effect on the businesses, operations, assets, prospects, or    
financial condition of the Company.                                             

2.26  Compensation and Benefit Plans.                                 

     (a) Section 2.26 of the Company Disclosure Schedule includes a complete and
accurate list of all pension, profit sharing, Section 401(k), thrift-savings,   
simplified employee pension, excess benefit plan, deferred compensation,        
incentive compensation, stock bonus, stock option, restricted stock, cash bonus,
employee stock ownership, severance pay, golden parachute, cafeteria, flexible  
compensation, life insurance, medical, dental, disability, welfare, or vacation 
plans or arrangements of any kind and any other Employee Pension Benefit Plan or
Employee Welfare Benefit Plan (as such terms are defined in the Employee        
Retirement Income Security Act of 1974, as amended "ERISA") in which employees  
or former employees of the Company participate (collectively, the "Benefit      
Plans").                                                                        

(b) The Company does not participate currently in and has never       
participated in, and is not required currently to and has never been required to
contribute to or otherwise participate in, any "multi-employer plan," as defined
in Sections 3(37)(A) and 4001(a)(3) of ERISA and Section 414(f) of the Code. The
Company does not participate currently in and has never participated in, and is 
not required currently to and has never been required to contribute to or       
otherwise participate in, any plan, program or arrangement subject to Title IV  
of ERISA.                                                                       

    (c) No former employee of the Company is entitled, and no current employee
will be entitled after termination of employment, to participate in any Employee
Welfare Benefit Plan as defined in ERISA, other than participation required to  
be permitted by the Company under Section 4980B of the Code and Sections 601 to 
609 of ERISA.                                                                   

    (d) The Company and the Shareholders have delivered to Tyler true, correct
and complete copies of the Benefit Plans and each applicable summary plan       
description and the most recent Form 5500s applicable to such Benefit Plans.    
Section 2.26 of the Company Disclosure Schedule sets forth the costs            
attributable to each Benefit Plan determined on an annual basis. Except as      
reflected or reserved against on the Company Balance Sheet, there is no unfunded
liability with respect to any Benefit Plan. None of the assets of the Company's 
Benefit Plans are invested in any property constituting employer real property  
or employer security within the meaning of Section 407(d) of ERISA.             

     (e) Each Employee Pension Benefit Plan sponsored, maintained or contributed
to by the Company is qualified under Section 401(a) of the Code; all related    
trusts are exempt from federal income tax under Section 501(a) of the Code; each
such plan has received a determination letter from the IRS stating that the plan
is qualified under Section 401(a) of the Code and all related trusts are exempt 
from federal income tax under Section 501(a) of the Code (which determination   
letter includes all statutory and regulatory provisions of the Tax Reform Act of
1986 and subsequent legislation for which a determination letter may be         
obtained); and to the knowledge of the Company, nothing has occurred since the  
date of the last such determination which resulted in, or is likely to result   
in, the revocation of such determination. A copy of the latest determination    
letter applicable to any Employee Pension Benefit Plan has been delivered to    
Tyler.                                                                          

    (f) Each of the Benefit Plans has been administered in material compliance
with its underlying documentation, the requirements of ERISA, the Code and all  
other applicable laws. All returns required to be made under ERISA and the Code 
with respect to the Benefit Plans have been timely filed and the Company has    
made all contributions required under the terms of any Benefit Plan (including, 
but in no way limited to, employer matching contributions and non-elective      
contributions and the deposit of elective deferrals as such terms are defined in
the Code) for all periods through and including the date hereof.                
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     (g) To the knowledge of the Company, there are not now, nor have there ever
been, any transactions involving the Benefit Plans or any fiduciary or          
administrator thereof which are prohibited under ERISA or the Code or for which 
an individual, class or statutory exemption is not available.                   

(h) There are no pending or, to the knowledge of the Company, any     
threatened claims by or on behalf of the Benefit Plans, the United States       
Department of Labor, the Internal Revenue Service, or any current or former     
employee of the Company or beneficiary of such current or former employee       
alleging a breach of any fiduciary duties or a violation of applicable state or 
federal law which could result in liability on the part of the Company, or a    
Benefit Plan under ERISA or any other law, nor, to the knowledge of the Company,
is there any basis for such a claim and neither the Company, nor, to the        
knowledge of the Company, any administrator or fiduciary of any Benefit Plan (or
agent of the foregoing) has engaged in any transaction or acted or failed to act
in any manner which would subject the Company to any liability for a breach of  
fiduciary duty under ERISA. The transactions contemplated by this Agreement     
(either alone or together with any other event) will not (i) terminate or modify
the provisions of any Benefit Plan or (ii) trigger an event under any Benefit   
Plan or employer benefit arrangement or law that will result in any payment     
(whether of severance pay or otherwise) becoming due from the Company.          

2.27  Labor Relations.                                                

     (a) To the knowledge of the Company or the Shareholders, the Company (i) is
in substantial compliance with all applicable laws respecting employment and    
employment practices, terms and conditions of employment (including occupational
health and safety), nondiscrimination, and wages and hours and (ii) are not     
engaged in any unfair labor practice, that in any such case would have a        
material adverse effect on the businesses, operations, assets or financial      
condition of the Company.                                                       

     (b) Except as disclosed in Section 2.27 of the Company Disclosure Schedule,
there is no unfair labor practice complaint against Company pending or, to the  
knowledge of the Company or any Shareholder, threatened before the National     
Labor Relations Board.                                                          

(c) There is no strike, labor dispute, slowdown, stoppage, or other   
material interference with or impairment by labor of the business of the Company
actually pending or, to the knowledge of the Company or any Shareholder,        
threatened or contemplated against or directly affecting the Company.           

 (d) To the knowledge of the Company or the Shareholders, no question of
union representation exists respecting the employees of the Company and no union
organizing activities are taking place.                                         

(e) Since August 31, 1997, no key employees of the Company have been  
terminated or have resigned their employment.                                   

     2.28  Adequate Insurance. The Company maintains insurance coverage that the
Company and the Shareholders believe is reasonably adequate to protect the      
assets and operations of the Company, and is sufficient for material compliance 
with all requirements of law and all agreements to which the Company is a party.
No notice of any termination or threatened termination of such policies has been
received by the Company and, to the knowledge of the Company or the             
Shareholders, such policies are valid, binding, and enforceable.                

    2.29  Contracts with Affiliates and Others. Except as set forth in Section
2.29 of the Company Disclosure Schedule, no director or officer of the Company, 
nor any person who is a spouse or descendant of such director or officer, has   
any direct or indirect relationship with any customer or supplier of, or other  
contracting party with, the Company (other than as a director, officer, or      
shareholder of the Company) that would be required to be disclosed in a proxy   
statement relating to the election of directors filed under the Securities      
Exchange Act of 1934 (the "Exchange Act").                                      

2.30  Revenue Recognition. The Company has not recognized and does not
recognize revenues from customers in advance of performing the services or      
furnishing the products for which the revenues were or are received.            

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2.31  Certain Fees. Except as disclosed in Section 2.31 of the Company
Disclosure Schedule, neither the Company nor any officer, director, or employee 
of the Company has employed any broker or finder or incurred any liability for  
any brokerage fees, commissions, or finders' fees in connection with the        
transactions contemplated hereby. Tyler recognizes and acknowledges that,       
subject to the Company's satisfaction of the representation and warranty in     
Section 2.13(b) hereof, the fees shown in Section 2.31 of the Company Disclosure
Schedule shall be paid by the Company at Closing.                               

2.32  Environmental Matters. To the knowledge of the Company or the   
Shareholders:                                                                   

The Company and its property (whether real, personal, owned, leased,  
managed or operated) (collectively, "Business Facilities") are in compliance    
with applicable laws, rules, regulations, ordinances, orders or guidance        
documents now in effect of any applicable governmental authority or any judicial
or administrative decision relating thereto that relate in any manner to health,
Materials of Environmental Concern, the environment, or a community's right to  
know (collectively, "Environmental Laws"). There are no Materials of            
Environmental Concern on any Business Facility in any quantity or concentration 
exceeding any limitation or standard established pursuant to Environmental Laws.
There are no actual or threatened claims, demands, allegations, actions, suits, 
investigations, notices, or proceedings against or relating to the Company or   
any of its Business Facilities relating to or arising out of the use, presence, 
or handling of Materials of Environmental Concern or compliance with            
Environmental Laws (collectively, "Environmental Claims"), and there is no basis
for any such Environmental Claims. There are no events, conditions,             
circumstances, facts, activities, practices, incidents or plans relating to or  
arising out of the operations of the Company which will prevent or interfere    
with compliance with Environmental Laws by Tyler after the Closing, or which may
give rise to any common law or statutory liability under Environmental Laws or  
form the basis of an Environmental Claim against the Company, or any of their   
respective Business Facilities.                                                 

   "Materials of Environmental Concern" means: (i) those substances included
within the statutory and/or regulatory definitions of "hazardous substance,"    
"hazardous waste," "extremely hazardous substance," "regulated substance,"      
"hazardous materials," or "toxic substances," under any Environmental Law; (ii) 
any material, waste or substance which is or contains: (A) petroleum, oil or a  
fraction or constituent thereof, (B) asbestos, (C) polychlorinated biphenyls,   
(D) formaldehyde, (E) explosives, or (F) radioactive materials (including NORM);
(iii) solid wastes (as defined under the Resource Conservation and Recovery Act,
42 U.S.C. sec.6901 et seq., and its implementing regulations) that post imminent
and substantial endangerment to health or the environment; (iv) any material,   
waste or substance designated classified or regulated as a "Class I" or "Class  
II" waste under Title 30 of the Texas Administrative Code; and (v) such other   
substances, materials, or wastes that are or become classified or regulated as  
hazardous or toxic under any applicable federal, state or local law or          
regulation. To the extent that the laws or regulations of any applicable state  
or local jurisdiction establish a meaning for any term defined herein through   
reference to federal Environmental Laws which is broader than the meaning under 
such federal Environmental Laws, such broader meaning shall apply.              

   2.33  Accuracy of Information Furnished. No representation or warranty by
the Company or the Shareholders in this Agreement (including the Company        
Disclosure Schedule) or any other agreement or document executed or to be       
executed by the Company or the Shareholders in connection herewith contains or  
will contain any untrue statement of a material fact or omits or will omit to   
state any material fact necessary to make the statements herein or therein, in  
light of the circumstances under which they were made, not false or misleading. 

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ARTICLE 3 

REPRESENTATIONS AND WARRANTIES OF TYLER 

  Tyler and Sub jointly and severally represent and warrant to the Company
and the Shareholders as follows:                                                

   3.1  Organization and Good Standing of Tyler. Tyler is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware. Sub is a corporation duly organized, validly existing and in good     
standing under the laws of the State of Texas.                                  

3.2  Foreign Qualification. Tyler is duly qualified or licensed to do 
business as a foreign corporation and in good standing in those jurisdictions   
set forth in Section 3.2 of the schedule delivered by Tyler concurrently with   
the execution of this Agreement (the "Tyler Disclosure Schedule"). Tyler is duly
qualified or licensed to do business as a foreign corporation in every          
jurisdiction where the failure so to qualify would have a material adverse      
effect on the businesses, operations, assets, or financial condition of Tyler   
and the Tyler Subsidiaries (as defined in Section 3.7), taken as a whole. For   
purposes of this Section 3.2, no material adverse affect shall be deemed to have
occurred as a result of non-payment of state or local franchise taxes not       
exceeding $37,500 in the aggregate.                                             

     3.3  Power and Authority to Conduct Business. Each of Tyler and Sub has the
corporate power and authority, and possess all licenses and permits, required by
governmental authorities to own, lease, and operate its properties and assets   
and to carry on its business as currently being conducted, except where the     
failure to possess such license or permit does not and would not have a material
adverse effect on the business, operations, assets or financial condition of    
Tyler and the Tyler Subsidiaries, taken as a whole.                             

3.4  Authority to Consummate Merger. Each of Tyler and Sub has the    
corporate power and authority to execute, deliver and perform its obligations   
under this Agreement and the other agreements or documents executed or required 
to be executed by it in connection with this Agreement and, subject to obtaining
the approval of the stockholders of Tyler, the execution, delivery and          
performance by each of Tyler and Sub of this Agreement and the other documents  
executed or to be executed by it in connection with this Agreement have been    
duly authorized by all necessary corporate action.                              

 3.5  Binding Effect. This Agreement and the other documents executed or
required to be executed by Tyler or Sub in connection with this Agreement have  
been or will have been duly executed and delivered by Tyler or Sub and are or   
will be, when executed and delivered, the legal, valid, and binding obligations 
of Tyler or Sub executing the same, enforceable in accordance with their terms  
except that:                                                                    

         (a) enforceability may be limited by bankruptcy, insolvency, or other
similar laws affecting creditors' rights;                             

          (b) the availability of equitable remedies may be limited by equitable
principles of general applicability; and                              

      (c) rights to indemnification under Section 10.5 may be limited by
considerations of public policy.                                      

   3.6  Compliance with Other Instruments. Subject to obtaining the approval
of the stockholders of Tyler and except as disclosed in Section 3.6 of the Tyler
Disclosure Schedule, neither the execution and delivery by Tyler or Sub of this 
Agreement or the other agreements or documents executed or required to be       
executed by Tyler or Sub in connection herewith, nor the consummation by Tyler  
or Sub of the transactions contemplated hereby and thereby will (i) conflict    
with the articles of incorporation or bylaws of Tyler or Sub, (ii) assuming     
satisfaction of the requirements set forth in clause (iii) below, violate any   
provision of law applicable to Tyler or any of the Tyler Subsidiaries; (iii)    
except for (A) requirements arising out of the HSR Act, (B) requirements of     
federal and state securities laws, and (C) the filing of articles of merger in  
accordance with the TBCA, require any consent, authorization, permit, license or
approval of, or declaration, registration or filing with or notice to, any      
person or governmental body or authority, domestic or foreign, under any        
provision of law applicable to Tyler or any of the Tyler Subsidiaries; or (iv)  
require any consent, approval or notice under, violate, breach, be in conflict  
with, or constitute a default (or an event that, with notice or lapse           

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of time or both, would constitute a default) under, or permit the termination or
the acceleration of maturity of, or result in the imposition of any lien, claim,
or encumbrance upon any property or asset of Tyler or any Tyler Subsidiary      
pursuant to any note, bond, indenture, mortgage, deed of trust, evidence of     
indebtedness, loan or lease agreement, other agreement or instrument or any     
judgment, order, injunction, or decree by which Tyler or any Tyler Subsidiary is
bound, to which any of them is a party, or to which any of their assets is      
subject, except for those violations and breaches that would not have a material
adverse effect on the businesses, operations, assets or financial condition of  
Tyler and the Tyler Subsidiaries, taken as a whole.                             

3.7  Capitalization of Tyler                                          

    (a) The authorized capital stock of Tyler consists of 50,000,000 shares of
Tyler Common Stock, and 1,000,000 shares of preferred stock, par value $10.00   
per share ("Tyler Preferred Stock"), of which 22,007,921 shares of Tyler Common 
Stock and no shares of Tyler Preferred Stock were issued and outstanding as of  
September 30, 1997 and 1,301,356 shares of Common Stock were held in treasury.  
All of the issued and outstanding shares of Tyler Common Stock have been duly   
authorized and are validly issued and are fully paid and nonassessable. There   
are no shares of the capital stock of Tyler held in its treasury or in the      
treasury of any corporation of which Tyler is the record or beneficial owner,   
directly or indirectly, of 50% or more of the capital stock (each such          
corporation being referred to as a "Tyler Subsidiary"). The shares of Tyler     
Common Stock to be issued in the Merger, when issued and delivered, will be duly
authorized, validly issued, fully paid, and nonassessable.                      

    (b) As of the date hereof, the authorized capital stock of Sub consists of
1,000 shares of common stock, par value $0.01 per share, all of which are       
validly issued, fully paid and nonassessable and are owned by Tyler.            

     (c) Except as described in Section 3.7 of the Tyler Disclosure Schedule and
in the Tyler Financial Statements (as hereinafter defined), there is no         
outstanding subscription, contract, convertible or exchangeable security,       
option, warrant, call, or other right obligating Tyler or any Tyler Subsidiary  
to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem, or   
otherwise acquire shares of, or securities convertible into or exchangeable for,
capital stock of Tyler.                                                         

 3.8  Commission Filings; Financial Statements. Section 3.8 of the Tyler
Disclosure Schedule lists all reports, registration statements and other        
filings, together with any amendments required to be made with respect thereto, 
that Tyler has filed with the Securities and Exchange Commission (the           
"Commission") under the Securities Act of 1933, as amended (the "Securities     
Act"), and the Exchange Act since October 1, 1995. All reports, registration    
statements and other filings filed by Tyler with the Commission since October 1,
1995 through the date of this Agreement, together with any amendments thereto,  
are sometimes collectively referred to as the "Tyler Commission Filings." Tyler 
has heretofore provided the Company and the Shareholders true, correct and      
complete copies of the Tyler Commission Filings. As of the respective dates of  
their filing with the Commission, the Tyler Commission Filings complied in all  
material respects with the Securities Act, the Exchange Act and the rules and   
regulations of the Commission promulgated thereunder, and did not contain any   
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements made therein, in light of 
the circumstances under which they were made, not misleading.                   

    Each of the consolidated financial statements (including any related notes
or schedules) included in or incorporated by reference into the Tyler Commission
Filings ("Tyler Financial Statements") was, and each of the consolidated        
financial statements to be included in the Proxy Statement (as defined in       
Section 6.2) (except for those financial statements of the Company furnished by 
or on behalf of the Company or the Shareholder to Tyler specifically for use    
therein) will be, prepared in accordance with generally accepted accounting     
principles applied on a consistent basis (except as may be noted therein or in  
the notes or schedules thereto), and fairly present or will fairly present, as  
the case may be, the consolidated financial position of Tyler and its           
consolidated subsidiaries as of the dates thereof and the results of operations,
cash flows and changes in stockholders' equity for the periods then ended       
(subject, in the case of the unaudited interim financial statements, to normal  
year-end audit adjustments). Since December 31, 1996, there has been no change  
in accounting principles applicable to, or methods of accounting utilized by,   
Tyler and the books and records of Tyler and the Tyler Subsidiaries have been   
and are being maintained in accordance with all                                 
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applicable legal and accounting requirements and good business practice, reflect
only valid transactions, are complete and correct in all material respects, and 
accurately reflect in all material respects the basis for the consolidated      
financial position and consolidated results of operations and cash flows of     
Tyler and its consolidated subsidiaries set forth in the Tyler Financial        
Statements.                                                                     

     3.9  Absence of Certain Changes. Since June 30, 1997, Tyler has not (except
as contemplated by this Agreement or as may result from the transactions        
contemplated by this Agreement or as described in the Tyler Disclosure          
Schedule):                                                                      

   (a) suffered any change in its business, results of operations,
    working capital, assets, liabilities, or financial condition or the manner
    of conducting its business other than changes that, individually or in the
aggregate, have not had a material adverse effect on the businesses,  
operations, assets or financial condition of Tyler and the Tyler      
Subsidiaries, taken as a whole;                                       

         (b) entered into any material commitment or transaction other than in
the ordinary course of business;                                      

      (c) written up, written down, or written off the book value of any
material amount of assets;                                            

(d) declared, paid, or set aside for payment any dividend or
distribution with respect to the capital stock of Tyler; or           

       (e) redeemed, purchased, or otherwise acquired, or sold, granted or
    otherwise disposed of, directly or indirectly, any of the capital stock or
securities of Tyler or any rights to acquire such capital stock or    
     securities, other than normal or periodic purchases, sales and grants under
provisions of existing employee benefit plans and programs of Tyler.  

     3.10  No Material Undisclosed Liabilities. To the knowledge of Tyler, there
is no liability or obligation of Tyler and the Tyler Subsidiaries of any nature,
whether absolute, accrued, contingent, or otherwise, other than:                

          (a) the liabilities and obligations that are fully reflected, accrued,
  or reserved against in the unaudited consolidated balance sheet of Tyler
and its consolidated subsidiaries as of June 30, 1997, for which the  
     reserves are appropriate and reasonable, or incurred in the ordinary course
of business and consistent with past practices since June 30, 1997;   

     (b) the loss contingencies set forth in Section 3.10 of the Tyler
Disclosure Schedule;                                                  

          (c) contractual liabilities or obligations of a nature not required to
be disclosed on a balance sheet prepared in accordance with generally 
accepted accounting principles; and                                   

     3.11  Litigation and Government Claims. Except as described in Section 3.11
of the Tyler Disclosure Schedule, neither Tyler nor any Tyler Subsidiary is a   
party to, and the business or assets of Tyler and the Tyler Subsidiaries are not
the subject of, any pending or, to the knowledge of Tyler, threatened suit,     
claim, action, or litigation with any party, or any administrative, arbitration,
or other governmental proceeding, investigation, or inquiry, in which the amount
involved and not covered by insurance exceeds $250,000. In the opinion of Tyler 
and its management, none of such pending or threatened matters would, severally 
or in the aggregate, have a material adverse effect on the business, operations,
assets or financial condition of Tyler and the Tyler Subsidiaries, taken as a   
whole.                                                                          

   3.12  No Violation of Any Instrument. Except as disclosed in Section 3.12
of the Tyler Disclosure Schedule, neither Tyler nor any Tyler Subsidiary is in  
violation of or default under nor, to the knowledge of Tyler, has any event     
occurred that, with the lapse of time or the giving of notice or both, would    
constitute a violation of or default under, or permit the termination or the    
acceleration of maturity of, or result in the imposition of a lien, claim, or   
encumbrance upon any property or asset of Tyler or any Tyler Subsidiary pursuant
to the articles or certificate of incorporation or bylaws of Tyler or any Tyler 
Subsidiary or any note, bond, indenture, mortgage, deed of trust, evidence of   
indebtedness, loan or lease agreement, or other agreement or instrument or any  
judgment, order, injunction, or decree to which it is a party, by which it is   

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bound, or to which any of its assets is subject, which would have a material    
adverse effect on the business, operations, assets or financial condition of    
Tyler and the Tyler Subsidiaries, taken as a whole.                             

     3.13  Certain Fees. Neither Tyler nor any officer, director, or employee of
Tyler has has employed any broker or finder or incurred any liability for any   
brokerage fees, commissions, or finders' fees in connection with the            
transactions contemplated hereby.                                               

   3.14  No Interim Operations of Sub. Sub was formed solely for the purpose
of engaging in the transactions contemplated hereby, has engaged in no other    
business activities and has conducted its operations only as contemplated       
hereby.                                                                         

   3.15  Accuracy of Information Furnished. No representation or warranty by
Tyler or Sub in this Agreement (including the Tyler Disclosure Schedule) or any 
other agreement or document executed or to be executed by Tyler or Sub in       
connection herewith contains or will contain any untrue statement of a material 
fact or omits or will omit to state any material fact necessary to make the     
statements herein or therein, in light of the circumstances under which they    
were made, not false or misleading.                                             

ARTICLE 4 

JOINT COVENANTS OF THE COMPANY, THE SHAREHOLDERS AND TYLER

4.1  Access; Confidentiality.                                         

     (a) During the period pending the Closing Date, the Company shall afford to
Tyler and its officers, employees, accountants, counsel, and other authorized   
representatives, full access to and the right to review and make copies of the  
Company's assets, properties, books, contracts, commitments, and records, view  
their physical properties, and communicate with the key employees of the Company
on a basis reasonably satisfactory to the Company, and will furnish and cause   
representatives to furnish promptly to Tyler such additional financial and      
operating data and other documents and information (certified if requested and  
reasonably susceptible to certification) relating to the Company's businesses   
and properties as Tyler or its duly authorized representatives may from time to 
time reasonably request.                                                        

   (b) During the period pending the Closing Date, Tyler shall afford to the
Company and the Shareholders and their accountants, counsel and other authorized
representatives the same rights of access to and inspection of the books,       
records, properties, contracts and personnel of Tyler as those afforded to Tyler
and its representatives in Section 4.1(a) above.                                

  (c) Notwithstanding any such investigation by Tyler, the Company, or the
Shareholders, or any information obtained pursuant thereto, it or he shall be   
entitled to rely in full upon the accuracy of the representations and warranties
of the other party or parties contained in this Agreement and upon its or his   
representations at Closing as to compliance with or performance of any covenants
made by it or him in this Agreement. Tyler, the Company, or the Shareholders    
shall have no obligation to investigate any such matters and, if any such       
matters are investigated, shall have no obligation to the other party or parties
with respect to information obtained thereby except as provided in Section 12.1 
of this Agreement.                                                              

   (d) The rights and obligations of the Shareholders, the Company and Tyler
pursuant to the Confidentiality Agreement (the "Confidentiality Agreement")     
dated September 17, 1997 by and among the Shareholders, the Company and Tyler   
will survive the execution and delivery of this Agreement, and all information  
obtained by the Shareholders, the Company and Tyler or any of their respective  
Representatives (as defined in the Confidentiality Agreement) pursuant hereto   
shall be deemed "Information" as that term is defined in the Confidentiality    
Agreement, and shall be subject to the provisions of the Confidentiality        
Agreement, except to the extent that Tyler is advised by counsel that disclosure
of any such Information, including the existence of the Confidentiality         
Agreement, is required by law in connection with the Merger.                    

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  4.2  Notice of any Material Change. Each of the Company and Tyler shall,
promptly after the first notice or occurrence or failure to occur thereof but   
not later than the Closing Date, supplement or amend its Disclosure Schedule to 
disclose the occurrence of any event or the existence of any state of facts that
would:                                                                          

        (a) make any of its representations and warranties in this Agreement
 untrue in any material respect or constitute a material failure of such
    party to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder;                           

         (b) make it necessary to amend the Proxy Statement in order to render
    the statements therein not misleading or to comply with applicable law; or

        (c) otherwise constitute a material adverse change in the respective
    businesses, results of operations, working capital, assets, liabilities or
 condition (financial or otherwise) of Tyler and the Tyler Subsidiaries,
     taken as a whole, or the Company. Subject to the provisions of Section 12.1
  of this Agreement, no supplement or amendment to any Disclosure Schedule
     shall have any effect for the purpose of determining the satisfaction of or
    compliance with the conditions to the obligations of the parties set forth
elsewhere in this Agreement.                                          

  4.3  Monthly Financial Statements. During the period pending the Closing
Date, each of Tyler and the Company shall furnish to the other its unaudited    
consolidated balance sheet and related statements of operations, stockholders'  
equity, and cash flows and any supporting schedules for the accounting periods  
ending on or about the last day of each such month, promptly after they are     
available, but not later than 30 days after the close of such accounting period.

  4.4  Antitrust Notification. Within 10 days after the date hereof, Tyler
and the Company shall each file with the Federal Trade Commission ("FTC") and   
the Antitrust Division of the U.S. Department of Justice ("DOJ") any            
Notification and Report Form required to be filed pursuant to the HSR Act, and  
shall timely supply any supplemental information that may be reasonably         
requested by the FTC or DOJ in connection therewith. The Company and Tyler shall
furnish to each other such necessary information and reasons under the HSR Act. 
The Company and Tyler shall furnish to each other copies of all correspondence, 
filings, or communications (or memoranda setting forth the substance thereof),  
between them or their representatives and the FTC or DOJ.                       

4.5  Tax Matters.                                                     

    (a) Each Shareholder and the Company shall prepare and timely file all tax
returns and amendments thereto required to be filed by the Company on or before 
the Closing Date. Tyler shall have a reasonable opportunity to review all such  
tax returns of the Company and amendments thereto.                              

   (b) Tyler or the Surviving Corporation, as appropriate, shall prepare and
file all tax returns of the Company that are due to be filed after the Closing  
Date and relate to tax periods of the Company ending on or before the Closing   
Date and shall pay all income taxes shown on such returns as due and owing. The 
Shareholders shall reimburse Tyler for taxes of the Company with respect to such
periods within fifteen (15) days after payment by Tyler or the Company of such  
taxes to the extent such taxes are not reflected in the reserve for tax         
liability (other than any reserve for deferred taxes established to reflect     
timing differences between book and tax income) shown on the face of the Company
Balance Sheet at Closing.                                                       

     (c) Each Shareholder covenants and agrees that he will be fully responsible
for, and indemnifies and holds harmless Tyler and the Company from and against, 
any and all claims, demands, losses, obligations and liabilities for income     
taxes of the Company, any penalties and interest with respect thereto, and any  
costs and expenses (including reasonable attorneys' and accountants' fees) of   
Tyler or the Company incurred as an incident thereto, relating to tax periods of
the Company ending on or before the Closing Date. Tyler agrees that each        
Shareholder shall have the sole right to contest, resolve and defend, at his    
cost, against any of the Company made or proposed by any taxing authority for   
such periods. Each Shareholder shall be entitled to retain such tax             
representatives, subject to the consent of Tyler (which shall not be            
unreasonably withheld), as he selects to represent him in resolving any such    
income tax controversies or disputes for tax periods ending on or before the    
Closing Date, and Tyler or the Company, as appropriate, shall execute and       
deliver powers of                                                               
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attorney, limited to such tax periods, in favor of each Shareholder or his tax  
representatives as necessary to effectuate the provisions of this Section 4.5.  

   (d) Subject to Closing, and specifically reserving any rights or remedies
Tyler or the Surviving Corporation may have for breach of the representations   
and warranties of Shareholders contained in Article 2 of this Agreement, Tyler  
covenants and agrees that either it or the Surviving Corporation, as            
appropriate, will be fully responsible for, and Tyler indemnifies and holds     
harmless each Shareholder from and against, any and all claims, demands, losses,
obligations and liabilities for income taxes of the Surviving Corporation, any  
penalties and interest with respect thereto, and any costs and expenses         
(including reasonable attorneys' and accountants' fees) of each Shareholder     
incurred as an incident thereto, relating to tax periods of the Surviving       
Corporation ending after the Closing Date; such responsibility of and indemnity 
by Tyler shall include the amounts of any and all tax consequences or           
liabilities attributable to any election by Tyler or the Surviving Corporation  
after the Closing to change the tax accounting methods utilized by the Company  
applicable to tax periods ending after the Closing Date. Each Shareholder agrees
that Tyler or the Surviving Corporation, as appropriate, shall have the sole    
right to contest, resolve and defend, at its cost, against any assessment for   
additional income taxes, notice of income tax deficiency or other adjustments of
income taxes of the Surviving Corporation made or proposed by any taxing        
authority for tax periods ending after the Closing Date.                        

    (e) All parties hereto agree if requested to reasonably cooperate with one
another and assist in the settlement, compromise, defense or other disposition  
of any assessments for additional taxes, notices of deficiency, proposed        
adjustments or other income tax disputes or controversies by or with taxing     
authorities relating to the Company. Tyler or the Surviving Corporation, as     
appropriate, will provide to each Shareholder or his tax representatives prompt 
written notification and copies of any communications from or to any taxing     
authority received or made by either of them relating to income tax liabilities 
of the Company for any tax periods ended on or before the Closing Date. Each    
Shareholder or his tax representatives will provide to Tyler prompt written     
notification and copies of any communications from or to any taxing authority   
received or made by either of them relating to income tax liabilities of the    
Company. Subsequent to any such notice, Tyler and each Shareholder shall keep   
the other fully advised of the status and developments with respect to such     
proposed or asserted income tax liability, and of the terms of any settlement or
other final resolution thereof. Failure by any party to notify any other party, 
as provided herein, shall not relieve the party otherwise entitled to such      
notice from its obligations contained in this Section 4.5 of this Agreement;    
provided, however, that the party entitled to such notice may pursue other      
remedies available to it at law or in equity for breach, if any, of the covenant
to notify contained herein.                                                     

   (f) No Shareholder shall, in any capacity, agree to any audit adjustments
by a taxing authority, or settle, compromise or otherwise agree to a resolution 
of any dispute or controversy, with respect to the income tax liability of the  
Company if the effect of the adjustment or the terms of the settlement increases
the income tax liabilities (including loss of carry forwards) of the Company:   

        (i) for the taxable period commencing on November 1, 1996 and ending
    on the Closing Date to an amount that, when added to the income taxes paid
   for such period by Tyler or the Company in accordance with Section 4.5(b)
   above (excluding the amount of any such income tax liability attributable
 to any election by Tyler or the Company after the Closing to change tax
     accounting methods utilized by the Company applicable to tax periods ending
     on or after November 1, 1996) exceeds the tax liability (excluding deferred
taxes) accrued on the books and records of the Company for the period 
commencing November 1, 1996 and ending on the Closing Date; or        

   (ii) for taxable periods commencing after the Closing Date (but
   including the amount of any such income tax liability attributable to any
     election by Tyler or the Company after the Closing to change tax accounting
methods utilized by the Company applicable to tax periods ending on or
    after November 1, 1996), unless the Shareholder or his tax representatives
     shall have in advance thereof consulted with Tyler and shall have agreed on
    mutually acceptable terms to pay to Tyler or the Surviving Corporation, as
 appropriate, the additional income taxes (subject to the limitation set
   forth in Subsection (i) above) that would be owed by Tyler or the Company
for all periods subsequent to October 31, 1996 as a result of such    
settlement. In any event, each Shareholder shall pay to Tyler or the  
Surviving Corporation, as                                             

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appropriate, the amount of any increase in income tax liabilities     
(including loss of carry forwards) of the Company for all tax periods 
     ending on or after the Closing Date (subject to the limitation set forth in
    subsection (i) above) that results from a final administrative or judicial
   determination adjusting the income tax liabilities of the Company for any
   period ending on or before the Closing Date, and such payment or payments
shall be made at the time Tyler or the Surviving Corporation files an 
 income tax return with a taxing authority covering a tax period that is
affected by such increase in income tax liability.                    

    (g) Each Shareholder agrees that, all proceeds received from any refund of
taxes arising out of any carry back to prior tax periods of any net operating   
loss of the Company for tax periods ending on or after the Closing Date,        
including any benefits derived from such carry backs to otherwise reduce an     
income tax liability for such prior periods, shall belong to Tyler or the       
Company. At the request of Tyler or the Company and at their expense, each      
Shareholder shall promptly file any and all necessary documents or prosecute all
other necessary proceedings to claim and recover such refunds.                  

(h) At the request of any Shareholder, Tyler or the Company, as       
appropriate, shall submit for filing with the Internal Revenue Service a Request
for Prompt Assessment of Income Taxes pursuant to Section 6501(d) of the        
Internal Revenue Code for all open tax periods through the Closing Date for     
which a federal income tax return or returns or amended return or returns have  
been filed by the Company.                                                      

 (i) From and after the Closing Date, no Shareholder will (a) extend the
statute of limitations; (b) make or change any elections affecting the Company; 
(c) change a method of accounting, in each instance with respect to tax         
liabilities of the Company relating to periods ending on or prior to the Closing
Date, without the prior written consent of Tyler (which consent shall not be    
unreasonably withheld).                                                         

    (j) To the extent the provisions of this Section 4.5 and the provisions of
Article 11 of this Agreement are inconsistent or conflict, the provisions of    
this Section 4.5 shall be determinative of the rights and obligations of the    
parties hereto.                                                                 

 (k) All tax sharing agreements or similar agreements with respect to or
involving the Company shall be terminated as of the Closing Date and, after the 
Closing Date and the Company shall not be bound thereby or have any liability   
thereunder.                                                                     

    4.6  Cooperation Pending Closing. Each of the parties hereto shall use its
reasonable best efforts to:                                                     

    (a) proceed promptly to make or give the necessary applications,
notices, requests, and filings in an effort to obtain at the earliest 
     practicable date and, in any event, before the Closing Date, the approvals,
   authorizations, and consents of third parties necessary to consummate the
transactions contemplated by this Agreement;                          

          (b) cooperate with and keep the other informed in connection with this
Agreement; and                                                        

      (c) take such actions as the other party may reasonably request to
consummate the transactions contemplated by this Agreement and use its
  reasonable best efforts and diligently attempt to satisfy, to the extent
  within its control, all conditions precedent to the obligations to close
this Agreement.                                                       

ARTICLE 5 

COVENANTS OF THE COMPANY AND THE SHAREHOLDERS 

   5.1  Conduct of Business Prior to Closing Date. During the period pending
the Closing Date (or other indicated date), the Company and the Shareholders.   

          (a) shall use its reasonable best efforts to conduct the operations of
  the Company in the ordinary and usual course of business consistent with
    past and current practices, and to maintain marketing organizations intact
and to preserve the goodwill of their employees, representatives,     
suppliers, and customers;                                             

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(b) shall confer upon request of Tyler with one or more     
 representatives of Tyler to report material operational matters and the
general status of ongoing operations;                                 

         (c) shall notify Tyler of any emergency or other change in the normal
course of the Company's businesses and of any governmental complaints,
investigations, or hearings that are pending (or that the same may be 
     contemplated) if such emergency, complaint, investigation, or hearing would
be material to the Company's businesses or properties;                

       (d) shall take no action that, and shall not fail to use reasonable
     best efforts to take (without material cost) any action the failure to take
     which, would cause or permit their representations and warranties contained
     in this Agreement to be untrue in any material respect on the Closing Date;
and                                                                   

       (e) except as may be permitted or required by this Agreement, shall
not directly or indirectly do any of the following: (i) issue, sell,  
     pledge, dispose of or encumber, (A) any capital stock of the Company or (B)
other than in the ordinary course of business and consistent with past
 practice, any assets of the Company; (ii) amend or propose to amend the
respective charters or bylaws of the Company; (iii) split, combine or 
     reclassify any outstanding capital stock, or, except as provided in Section
    5.6 hereof, declare, set aside or pay any dividend or distribution payable
 in cash, stock, property or otherwise with respect to its capital stock
   whether now or hereafter outstanding; (iv) redeem, purchase or acquire or
    offer to acquire any of the Company's capital stock; or (v) enter into any
   contract, agreement, commitment or arrangement with respect to any of the
matters set forth in this Section 5.1(e).                             

5.2  Employment Agreement. At or before the Closing each of the       
Shareholders and the Company shall execute and deliver an Employment and        
Noncompetition Agreement in substantially the form of Exhibit B hereto, with    
such changes therein prior to execution as may be mutually approved by Tyler and
each Shareholder (the "Employment Agreements"), and providing for the employment
of the Shareholders by the Surviving Corporation after the Closing, covenants by
the Shareholders not to compete with the Surviving Corporation, and             
compensation, all as provided therein.                                          

 5.3  Noncompetition Agreements. Each Shareholder agrees to use his best
efforts to cause the key management and other employees of the Company          
identified by Tyler in Section 5.3 of the Tyler Disclosure Schedule (the        
"Employees") to execute and deliver employment, confidentiality and             
noncompetition agreements with the Company in a form acceptable to Tyler (the   
"Noncompetition Agreements").                                                   

5.4  Agreement Not to Negotiate. Pending the Closing, and through the 
period ending March 31, 1998 if this Agreement is terminated without closing by 
the Company or the Shareholders the Company and the Shareholders shall not,     
either directly or indirectly through an agent, representative or other person, 
solicit or authorize any person to solicit, or initiate or encourage, directly  
or indirectly, any proposal for the acquisition of all or any material part of  
the capital stock, assets, or business of the Company, or for the merger,       
consolidation, or other combination of the Company with any other person or     
entity, or enter into any discussions or negotiations for any such proposal, or 
provide any person with information or assistance in furtherance of any such    
proposal, and shall promptly notify Tyler in writing of all proposals received  
with respect to such matters.                                                   

  5.5  Accuracy of Information Furnished. The information supplied by each
Shareholder to Tyler in writing expressly for inclusion in any documents        
(including the Proxy Statement) filed with the Commission in connection with or 
as a result of the transactions contemplated hereby, will, at the respective    
times such documents are filed with the Commission, not contain any untrue      
statement of a material fact or omit to state any material fact necessary to    
make the statements therein, in light of the circumstances under which they were
made, not false or misleading.                                                  

    5.6  Regulation S-X Financial Statements. Not later than October 10, 1997,
the Company shall cause to be prepared and shall deliver to Tyler audited       
balance sheets of the Company as of October 31, 1996, 1995 and 1994 and the     
related audited statements of operations, stockholder's equity, and cash flows  
for the years then ended, with notes thereto, prepared in accordance with United
States generally accepted accounting principles and Regulation S-X ("Regulation 
S-X") promulgated by the Securities and Exchange Commission, reported           

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upon without exception or qualification by Bland Garvey Taylor Eads & Medlock;  
and the unaudited balance sheet of the Company as of August 31, 1997, and the   
related unaudited statements of operations, stockholder's equity, and cash flows
for the ten months then ended, with notes thereto, prepared in accordance with  
United States generally accepted accounting principles and Regulation S-X,      
reviewed by Bland Garvey Taylor Eads & Medlock.                                 

     5.7  Termination of Shareholders Agreement. The Shareholders agree to cause
that certain Shareholders Agreement among Glenn A. Smith, Brian B. Berry, Joane 
Cogan and the Company to be terminated at or before the Closing. The            
Shareholders hereby consent to, and waive any transfer restrictions under the   
Shareholders Agreement that would limit, the transfer of all the outstanding    
capital stock of the Company to Tyler pursuant to the Merger.                   

5.8  Pre-Closing Bonuses. Prior to the Closing, the Company shall be  
entitled to pay bonuses to employees of the Company for past services rendered, 
which bonuses shall not exceed an aggregate of $200,000.                        

    5.9  Form of Merger. The Company, the Shareholders and Tyler may, pursuant
to written amendment to this Agreement, change the form of the Merger to a      
merger of the Company with and into Sub, provided such a revised form of Merger 
would qualify as a reorganization under Section 386 of the Code.                

ARTICLE 6 

COVENANTS OF TYLER

Tyler covenants and agrees with the Company and the Shareholders as   
follows:                                                                        

6.1  Conduct Prior to Closing Date. Pending the Closing, Tyler shall: 

(a) confer upon request of the Shareholders with one or more
    representatives of the Shareholders to report material operational matters
and the general status of ongoing operations of Tyler and the Tyler   
Subsidiaries; and                                                     

      (b) take no action that, and shall not fail to use reasonable best
efforts to take (without material cost) any action the failure to take
   which, would cause or permit its representations and warranties contained
in this Agreement to be untrue in any material respect at the Closing.

 6.2  Proxy Statement. As promptly as practicable after the execution of
this Agreement, Tyler shall prepare and file with the Commission a proxy        
statement (the "Proxy Statement") pursuant to the Exchange Act. Subject to the  
fiduciary obligations of the Board of Directors of Tyler under applicable law,  
the Proxy Statement shall contain the recommendation of the Board of Directors  
of Tyler that the stockholders of Tyler vote to approve the Merger and this     
Agreement. Except to the extent required by law (and in any such case only after
three business days' prior notice to the Shareholders), Tyler shall not include 
in the Proxy Statement or otherwise make public the amount of compensation      
payable to any Shareholder.                                                     

6.3  Meetings of Stockholders. Tyler shall promptly take all action   
reasonably necessary in accordance with the Delaware General Corporation Law,   
the rules of the NYSE and its articles of incorporation and bylaws to convene a 
meeting of its stockholders to consider and vote upon the adoption and approval 
of the Merger and this Agreement (the "Tyler Stockholders Meeting"). Subject to 
its fiduciary obligations under applicable law and in accordance with the       
provisions of this Agreement, the Board of Directors of Tyler (i) shall         
recommend at such meeting that the stockholders of Tyler vote to adopt and      
approve the Merger and this Agreement; (ii) shall use its reasonable efforts to 
solicit from stockholders of Tyler proxies in favor of such adoption and        
approval; and (iii) shall take all other action reasonably necessary to secure a
vote of its stockholders in favor of the adoption and approval of the Merger and
this Agreement.                                                                 

     6.4  Stock Exchange Listing. Tyler shall use its reasonable best efforts to
cause the shares of Tyler Common Stock to be issued upon consummation of the    
Merger to be approved for listing on the NYSE, subject to official notice of    
issuance, prior to the Closing Date.                                            

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6.5  Guaranties of Company Obligations.                               

(a) From and after the Closing, Tyler guarantees to each Shareholder, 
respectively, and his heirs, successors and assigns, the full and prompt payment
by the Company of all amounts that become due and payable to them under or      
pursuant to the terms of any Employment Agreement, to be entered into between   
the Company and the Shareholder as provided in Section 5.2 of this Agreement,   
and the timely performance by the Company of all of the terms, conditions,      
covenants and agreements to be performed by the Company under or pursuant to the
terms of said Employment Agreement.                                             

(b) The obligation of Tyler to make any payments or render performance
under this guaranty shall be coextensive with the obligation of the Company to  
make payment or render performance under any Employment Agreement, and Tyler    
shall be entitled to assert as a defense to or excuse for or delay in any       
payment or performance by it the same defenses or excuses for payment or        
performance as would be available to the Company. Subject to the foregoing, the 
guaranty by Tyler contained herein is absolute and unconditional.               

  (c) Tyler waives notice of acceptance of this agreement of guaranty, and
waives diligence or presentment on the part of any Shareholder in the           
enforcement of any liability, obligation or duty guaranteed hereby.             

    (d) Tyler agrees that the validity of this agreement of guaranty shall not
in any way be terminated, affected or impaired by reason of any waiver of or    
failure to enforce any of the rights or remedies of any Shareholder contained in
any Employment Agreement, or by reason of any extension of time or other        
forbearance granted to the Company by any Shareholder.                          

   (e) Tyler agrees that, at the option of any Shareholder, it may be joined
in any action or proceedings commenced against the Company in connection with   
and based upon any provisions of the Employment Agreement, and that recovery may
be had against Tyler in such action or proceedings, or in any independent action
or proceedings against Tyler, without requirement that any Shareholder or his   
successors or assigns, first assert, prosecute, or exhaust any remedy or claim  
against the Company.                                                            

    (f) In the event of any bankruptcy, reorganization, winding up, or similar
proceedings with respect to the Company, no limitation on its liability under   
the Employment Agreement which may now or hereafter be imposed or permitted by  
any federal, state, or other statute, law regulation, or judicial or            
administrative determination applicable to such proceedings, shall in any way   
limit Tyler's obligations hereunder.                                            

6.6  Other Tyler Obligations. At the Closing, if not theretofore      
accomplished, Tyler will cause the Company to execute and deliver to the        
Shareholders the Employment Agreements, against execution and delivery by the   
Shareholders.                                                                   

    6.7  Company Indemnification Obligations. (a) Tyler and Sub agree that all
rights to indemnification existing in favor of the present or former directors, 
officers, employees, fiduciaries and agents of the Company (collectively, the   
"D&O Indemnified Parties") as provided in the Company's Articles of             
Incorporation, Bylaws, or other organizational documents as in effect as of the 
date hereof, shall survive the Merger and shall continue in full force and      
effect for six years after the Effective Time (without modification or          
amendment, except as required by applicable law), to the fullest extent         
permitted by law, and shall be enforceable by the D&O Indemnified Parties       
against the Surviving Corporation; provided that in any event Tyler and the     
Surviving Corporation shall pay and reimburse expenses in advance of the final  
disposition of any action or proceeding to each D&O Indemnified Party to the    
fullest extent permitted by law.                                                

  (b) The provisions of this Section 6.7 shall survive the consummation of
the Merger and expressly are intended to benefit each of the D&O Indemnified    
Parties. Each of the D&O Indemnified Parties shall be entitled to enforce the   
covenants contained herein.                                                     

   (c) If the Surviving Corporation, or any of its successors or assigns (i)
reorganizes, amalgamates or consolidates with or merges into any other person   
and is not the resulting, continuing or surviving corporation or entity of such 
reorganization, amalgamation, consolidation or merger, or (ii) liquidates,      
dissolves or transfers all or substantially all of its properties and assets to 
any person or persons, then, and in such case,                                  

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proper provision will be made so that the successors or assigns of the Surviving
Corporation assume all of the obligations of the Surviving Corporation set forth
in this Section 6.7.                                                            

 6.8  Agreements Regarding Stock Options. Effective on the Closing Date,
Tyler agrees to grant options, conditioned on the consummation of the           
transactions contemplated hereby and Tyler stockholder approval of any required 
increase in the number of shares of Tyler Common Stock which may be issued      
pursuant to the Tyler Stock Option Plan, to purchase an aggregate of 200,000    
shares of Tyler Common Stock to employees of the Company designated by the      
Shareholders. The selection by the Shareholders of such employees and the number
of option shares to be granted to each shall be subject to the reasonable       
approval of Tyler. The exercise price of the options shall be equal to the      
reported closing price of the Tyler Common Stock on the New York Stock Exchange 
on the Closing Date. The options shall have a term of 10 years from the Closing 
Date and shall vest on each of the first five anniversary dates at the rate of  
20% of the original number of option shares granted. The options shall be       
incentive stock options pursuant to the Tyler Stock Option Plan, as amended,    
shall contain such other terms as are customary for options granted under that  
plan, and shall be evidenced by option agreements incorporating all of such     
terms.                                                                          

   6.9  Release of Shareholder Guaranties. At or prior to the Closing, Tyler
shall obtain and provide to the Shareholders an absolute and unconditional      
release, executed by the holders of the indebtedness of the Company identified  
in Section 2.21 of the Company Disclosure Schedule as guaranteed by the         
Shareholders and by the surety companies that issued the performance bonds      
identified in such Section 2.21, from any liability with respect to such        
indebtedness or performance bonds whether as maker, endorser, surety, obligor,  
guarantor or otherwise, or shall provide to the Shareholders the agreement of   
Tyler to indemnify the Shareholders against any such liability, which           
indemnification agreement shall be reasonably acceptable to the Shareholders.   

ARTICLE 7 

JOINT CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS 

     Except as may be waived by both Tyler and the Shareholders, the obligations
of the Company, the Shareholders, Tyler and Sub to consummate the transactions  
contemplated by this Agreement shall be subject to the satisfaction, on or      
before the Closing Date, of each of the following conditions:                   

    7.1  HSR Act. All filings required under the HSR Act shall have been made,
and all waiting periods, including any extension thereof, that may be applicable
to the transactions contemplated by this Agreement under the provisions of the  
HSR Act shall have expired or been waived or otherwise terminated.              

    7.2  Absence of Litigation. No governmental agency or authority shall have
instituted, or threatened in writing to institute, any action or proceeding     
seeking to delay, restrain, enjoin, or prohibit the consummation of the         
transactions contemplated by this Agreement, and no order, judgment, or decree  
by any court or governmental agency or authority shall be in effect that        
enjoins, restrains, or prohibits the same or, in the reasonable judgment of     
Tyler, otherwise would materially interfere with the operation of the assets and
business of Tyler and the Tyler Subsidiaries or the Company after the Closing   
Date.                                                                           

ARTICLE 8 

CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY AND THE SHAREHOLDERS 

Except as may be waived by the Company and the Shareholders, the      
obligations of the Company and the Shareholders to consummate the transactions  
contemplated by this Agreement shall be subject to the satisfaction on or before
the Closing Date of each of the following conditions:                           

     8.1  Compliance. Tyler shall have, or shall have caused to be, satisfied or
complied with and performed in all material respects all terms, covenants, and  
conditions of this Agreement to be complied with or performed by Tyler on or    
before the Closing Date.                                                        

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8.2  Representations and Warranties. All of the representations and   
warranties made by Tyler in this Agreement, the Tyler Disclosure Schedule (prior
to supplementation or amendment thereto pursuant to Section 4.2 of this         
Agreement), the Employment Agreements, and in all certificates and other        
agreements delivered by Tyler to the Shareholders pursuant hereto or in         
connection with the transactions contemplated hereby, shall have been true and  
correct in all material respects as of the date hereof, and shall be true and   
correct in all material respects at the Closing Date with the same force and    
effect as if such representations and warranties had been made at and as of the 
Closing Date, except for changes permitted or contemplated by this Agreement.   

8.3  Opinion. The Company and the Shareholders shall have received an 
opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. ("Liddell, Sapp"),      
counsel for Tyler, dated the Closing Date, in form and substance reasonably     
satisfactory to the Company, the Shareholders and their counsel, relating to the
matters set forth in the following Sections Of this Agreement:                  

3.1;                                                            

3.4; and                                                    

3.5 (except the opinion as to enforceability may exclude the
Employment Agreements and the Noncompetition Agreements).             

8.4  No Material Adverse Change. There shall have occurred no material
adverse change in the businesses, properties, assets, liabilities, results of   
operations or condition (financial or otherwise) of Tyler and the Tyler         
Subsidiaries, taken as a whole.                                                 

    8.5  Financing. On or before thirty days after the date hereof Tyler shall
have obtained financing for the transactions contemplated hereby acceptable to  
Tyler.                                                                          

   8.6  Certificates. The Company and the Shareholders shall have received a
certificate or certificates, executed on behalf of Tyler by the President or any
Vice President of Tyler, to the effect that the conditions contained in Sections
7.1 and 7.2 hereof with respect to matters therein relating to Tyler, and in    
Sections 8.1, 8.2, and 8.4 hereof, have been satisfied.                         

ARTICLE 9 

CONDITIONS PRECEDENT TO OBLIGATIONS OF TYLER

Except as may be waived by Tyler, the obligations of Tyler and Sub to 
consummate the transactions contemplated by this Agreement shall be subject to  
the satisfaction, on or before the Closing Date, of each of the following       
conditions:                                                                     

     9.1  Compliance. The Company and each Shareholder shall have, or shall have
caused to be, satisfied or complied with and performed in all material respects 
all terms, covenants, and conditions of this Agreement to be complied with or   
performed by any of them on or before the Closing Date.                         

9.2  Representations and Warranties. All of the representations and   
warranties made by the Company and the Shareholders in this Agreement, the      
Company Disclosure Schedule (prior to any supplementation or amendment pursuant 
to Section 4.2 of this Agreement), and in all certificates and other documents  
delivered by the Company and the Shareholders pursuant hereto or in connection  
with the transactions contemplated hereby, shall have been true and correct in  
all material respects as of the date hereof, and shall be true and correct in   
all material respects at the Closing Date with the same force and effect as if  
such representations and warranties had been made at and as of the Closing Date,
except for changes permitted or contemplated by this Agreement.                 

9.3  Securities Law Compliance. The issuance and delivery of shares of
Tyler Common Stock in the Merger shall have been registered or qualified under  
the Securities Act and all applicable state securities laws or counsel for Tyler
shall be satisfied that an exemption from such registration or qualification is 
available; no                                                                   

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stop order suspending the effectiveness of any such registration or             
qualification shall be in effect; and no proceeding for such purpose shall be   
pending before any agency or authority having jurisdiction thereof.             

  9.4  Opinions. Tyler shall have received the opinion of Andrews & Barth,
counsel for the Company and the Shareholder, dated as of the Closing Date, in   
form and substance satisfactory to Tyler and its counsel, relating to the       
matters set forth in the following Sections of this Agreement:                  

2.1;                                                            

2.6; and                                                    

2.7 (except the opinion as to enforceability may exclude the
Employment Agreements and the Noncompetition Agreements).             

9.5  No Material Adverse Change. There shall have occurred no material
adverse change in the businesses, properties, assets, liabilities, results of   
operations, or condition (financial or otherwise), of the Company.              

     9.6  Consents to Transaction. Tyler and the Company shall have received all
consents or approvals, and made all applications, requests, notices, and filings
with, any person, governmental authority, or governmental agency required to be 
obtained or made in connection with the consummation of the transactions        
contemplated by this Agreement, excluding actions required under the HSR Act    
(which are conditions precedent to closing under Section 7.1), but including the
consents of the lenders and third parties set forth in the Company Disclosure   
Schedule and the Tyler Disclosure Schedule.                                     

     9.7  Financing. On or before thirty days after the date hereof, Tyler shall
have obtained financing for the transactions contemplated hereby acceptable to  
Tyler.                                                                          

9.8  Noncompetition Agreements. Each of the Employees shall have duly 
entered into Noncompetition Agreements with the Company acceptable to Tyler.    

   9.9  Business Resources Corporation. Tyler or a subsidiary of Tyler shall
have acquired all or substantially all of the outstanding capital stock or      
assets of Business Resources Corporation ("BRC") pursuant to that certain       
Agreement and Plan of Merger dated of even date herewith among Tyler, T1        
Acquisition Corporation, BRC, and William D. Oates (the "BRC Merger Agreement").

   9.10  Stockholder Approval. The stockholders of Tyler shall have approved
the Merger and this Agreement.                                                  

9.11  Certificates. Tyler shall have received a certificate or        
certificates, executed on behalf of the Company by the President of the Company,
and by each Shareholder in his individual capacity, to the effect that the      
conditions in Sections 7.1 and 7.2 hereof with respect to matters therein       
relating to the Company, and Sections 9.1, 9.2, and 9.5 hereof, have been       
satisfied.                                                                      

ARTICLE 10

SECURITIES LAW REGISTRATION AND COMPLIANCE

   10.1  Securities Law Compliance; Restrictions on Shares. Each Shareholder
and each other holder of Stock Options or Company Common Stock acknowledges     
receipt of the Tyler Commission Filing, this Agreement and the Tyler Disclosure 
Schedule and the opportunity to ask questions of and receive answers from       
representatives of the management of Tyler concerning the terms and conditions  
of the transactions contemplated hereby and to obtain all additional information
that Tyler possesses or could acquire without unreasonable expense that is      
necessary to verify the accuracy of information furnished to him, and           
acknowledges and agrees:                                                        

          (a) The shares of Tyler Common Stock to be received by him as a result
of the Merger have not been registered under the Securities Act or any
applicable state securities law;                                      

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          (b) He is acquiring the shares so to be received in the Merger for his
   own account and not with a view to the distribution or resale thereof and
     will not sell, pledge, hypothecate, or otherwise transfer the shares unless
they are registered under the Securities Act and applicable state     
    securities laws unless, prior thereto, he shall have delivered to Tyler an
     opinion, in form and substance reasonably satisfactory to Tyler, of counsel
experienced and competent in federal securities laws and acceptable to
Tyler, to the effect that an exemption from registration is available 
therefor;                                                             

    (c) Except as otherwise provided in this Agreement, Tyler has no
    obligation to register any sales or transfers of the shares so received by
him;                                                                  

      (d) During the year after the Merger, he will not be able to sell,
transfer, or otherwise dispose of the shares so received unless, prior
    thereto, the Shareholder shall have delivered to Tyler an opinion, in form
    and substance reasonably satisfactory to Tyler, of counsel experienced and
     competent in federal securities laws and acceptable to Tyler, to the effect
     that an exemption from registration under the Securities Act and applicable
state securities laws is at the time available (unless registered as  
     elsewhere provided in this Agreement), and thereafter any sales, transfers,
  or other dispositions may be limited by the provisions of Rule 144 under
the Securities Act (or by other rules then in effect);                

       (e) In view of the foregoing, he understands that he is at economic
risk with respect to his investment in the shares so received in the  
Merger;                                                               

(f) Tyler may place an appropriate legend on the certificate
   representing the shares so to be received restricting their transfer, and
stop-transfer instructions will be given to the transfer agent for the
Tyler Common Stock with respect to such certificates; and             

         (g) To provide such information as may be requested by Tyler in order
    for Tyler to determine if he is an accredited purchaser under Regulation D
   of the Commission or otherwise can be qualified as a purchaser under Rule
506 of such Regulation D.                                             

 10.2  Piggyback Registration. If within one year after the Closing Date
Tyler proposes (whether or not for its own account) to register any of its      
securities under the Securities Act for sale in a firm commitment underwritten  
public offering, Tyler shall give written notice to the Shareholders of its     
intention to effect such a registration not later than 15 days prior to the     
anticipated date of filing with the Commission of a registration statement,     
which notice shall offer each Shareholder the opportunity to include in such    
registration statement any of the shares of Tyler Common Stock received in the  
Merger and held by such Shareholder ("Shares") that such Shareholder may request
(a "Piggyback Registration"). Tyler's obligation under this Section 10.2 shall  
be limited to registrations as to which a registration statement is to be filed 
on or before one year after the date hereof. Subject to the provisions of this  
Agreement, Tyler will use its reasonable efforts to cause all the Shares for    
which the Shareholders have requested registration to be registered under the   
Securities Act to the extent required to permit the sale by the Shareholders of 
such Shares; provided, that if the registration relates to an underwritten      
public offering and the managing underwriter or underwriters believe that the   
inclusion of all shares requested to be included in the proposed registration   
would adversely affect the marketing of such shares, Tyler may first include in 
such registration all securities Tyler proposes to sell, and the Shareholders   
shall accept a reduction (including a total elimination) in the number of shares
to be included in such registration, pro rata with the other holders of Tyler   
Common Stock making requests for registration, on the basis of the number of    
shares of Tyler Common Stock so requested to be included by the Shareholders and
the other selling shareholders. Nothing in this section shall limit Tyler's     
ability to withdraw a registration statement it has filed either before or after
effectiveness.                                                                  

10.3  Registration Procedures.                                        

  (a) In connection with any registration hereunder, each Shareholder will
furnish promptly to Tyler in writing such information (together with such       
supplements as may be necessary from time to time) with respect to itself and   
the proposed distribution by it as shall be reasonably necessary in order to    
ensure compliance with federal and applicable state securities laws. Such       
information shall not, at the time the registration statement is filed or       
becomes effective, contain any untrue statement of a material fact or omit to   

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state a material fact necessary to make the statements therein, in light of the 
circumstances under which they were made, not false or misleading.              

(b) In any registration relating to an underwritten public offering of
Tyler Common Stock or other securities of Tyler entitled generally to vote in   
the election of directors (or any securities convertible into or exchangeable   
for or exercisable for the purchase of securities so entitled generally to vote 
in the election of directors) (collectively, the "Voting Securities"), whether  
or not a Shareholder is participating in such registered underwritten public    
offering, at the request of the managing underwriter or underwriters, each      
Shareholder will agree not to effect any sale or distribution, including any    
sale pursuant to Rule 144 (or any successor provision) promulgated under the    
Securities Act of any Shares, and not to effect any such sale or distribution of
any other Tyler Common Stock or Voting Securities (in each case, other than as  
part of such registration) for such period of time as reasonably required by    
such managing underwriter or underwriters ("Lockup Period"), but in no event    
shall the Shareholder be required to agree to a Lockup Period longer than the   
Lockup Period to which any other selling shareholder is subject.                

    10.4  Expenses. In connection with any proposed registration of securities
by Tyler, whether or not effected or consummated, Tyler, each Shareholder, and  
any other selling shareholders shall each pay their pro rata share of Tyler's   
out of pocket expenses incurred in connection with a proposed registration under
Section 10.2 in which Tyler is not selling any securities for its own account,  
including, without limitation, all registration and filing fees, printing       
expenses, and fees and disbursements of counsel and accountants for Tyler. Each 
Shareholder shall pay all of his expenses, including his attorney's fees, and   
including the underwriting discount, selling commissions and all expenses of the
underwriters relating to his Shares incurred in connection with each            
registration pursuant to Section 10.2.                                          

10.5  Indemnification.                                                

(a) In the event of a registration of any of the Shares under the     
Securities Act pursuant to Section 10.2, Tyler shall indemnify and hold harmless
each Shareholder and each underwriter of Shares thereunder and each person who  
controls the Shareholder or underwriter within the meaning of the Securities Act
and the Exchange Act against any losses, claims, damages or liabilities         
(including reasonable attorneys' fees), joint or several, to which the          
Shareholder or underwriter or controlling person may become subject under the   
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,  
damages or liabilities (or actions in respect thereof) or arise out of or are   
based upon any untrue statement or alleged untrue statement of any material fact
contained in the registration statement under which such Shares were registered 
under the Securities Act pursuant to Section 10.2, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereof, or  
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the          
statements therein not misleading, and will reimburse each such Shareholder,    
underwriter and controlling person for any legal or other expenses reasonably   
incurred by them in connection with investigating or defending any such loss,   
claim, damage, liability or action; provided, however, that Tyler will not be   
liable in any such case if and to the extent that any such loss, claim, damage  
or liability arises out of or is based upon an untrue statement or alleged      
untrue statement or omission or alleged omission so made in conformity with     
information furnished by the Shareholder, underwriter or controlling person for 
use in such registration statement or prospectus; provided, further, that Tyler 
will not be liable hereunder to any underwriter or any person who controls any  
underwriter within the meaning of the Securities Act and the Exchange Act for   
any loss, claim, damage or liability that arises out of, or is based upon, any  
untrue statement or alleged untrue statement or any omission or alleged omission
contained in any preliminary prospectus that was corrected by any subsequent    
prospectus, and the underwriter was required to deliver but failed to deliver   
such prospectus as required by the Securities Act.                              

(b) In the event of a registration of any of the Shares under the     
Securities Act pursuant to Section 10.2, the Shareholder shall indemnify and    
hold harmless Tyler and each person who controls Tyler within the meaning of the
Securities Act and the Exchange Act, each officer of Tyler who signs the        
registration statement, each director of Tyler, each underwriter and each person
who controls any underwriter within the meaning of the Securities Act and the   
Exchange Act against all losses, claims, damages or liabilities, joint or       
several, to which Tyler or such officer or director or underwriter or           
controlling person may become subject                                           

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under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or  
are based upon any untrue statement or alleged untrue statement of any material 
fact contained in the registration statement under which such Shares were       
registered under the Securities Act pursuant to Section 10.2, any preliminary   
prospectus or final prospectus contained therein, or any amendment or supplement
thereof, or arise out of or are based upon the omission or alleged omission to  
state therein a material fact required to be stated therein not misleading, and 
will reimburse Tyler and each such officer, director, underwriter and           
controlling person for any legal or other expenses reasonably incurred by them  
in connection with investigating or defending any such loss, claim, damage,     
liability or action; provided, however, that the Shareholder will be liable     
hereunder in any such case if and only to the extent that any such loss, claim, 
damage or liability arises out of or is based upon an untrue statement or       
alleged untrue statement or omission or alleged omission relating to the        
Shareholder made in reliance upon and in conformity with information pertaining 
to the Shareholder, as such, furnished in writing to Tyler by the Shareholder   
for use in such registration statement or prospectus ("Shareholder              
Information"); provided, further, that the Shareholder will not be liable       
hereunder to any underwriter or any person who controls an underwriter within   
the meaning of the Securities Act and the Exchange Act for any loss, claim,     
damage or liability that arises out of, or is based upon, any untrue statement  
or alleged untrue statement or any omission or alleged omission in any          
Shareholder Information contained in any preliminary prospectus that was        
corrected by any subsequent prospectus, and the underwriter was required to     
deliver but failed to deliver such prospectus as required by the Securities Act.

   (c) Promptly after receipt by an indemnified party hereunder of notice of
the commencement of any action, such indemnified party shall, if a claim in     
respect thereof is to be made against the indemnifying party hereunder, notify  
the indemnifying party in writing thereof, but the omission so to notify the    
indemnifying party shall not relieve it from any liability which it may have to 
any indemnified party other than under this Section 10.5. In case any such      
action shall be brought against any indemnified party and it shall notify the   
indemnifying party of the commencement thereof, the indemnifying party shall be 
entitled to participate in and, to the extent it shall wish, to assume and      
undertake the defense thereof with counsel reasonably satisfactory to such      
indemnified party and, after notice from the indemnifying party to such         
indemnified party of its election so to assume and undertake the defense        
thereof, the indemnifying party shall not be liable to such indemnified party   
under this Section 10.5 for any legal expenses subsequently incurred by such    
indemnified party in connection with the defense thereof other than reasonable  
costs of investigation and of liaison with counsel so selected; provided,       
however, that (i) if the indemnifying party has failed to assume the defense and
employ counsel or (ii) if the defendants in any such action include both the    
indemnified party and the indemnifying party and the indemnified party shall    
have reasonably concluded that there may be reasonable defenses available to it 
that are different from or additional to those available to the indemnifying    
party or if the interests of the indemnified party reasonably may be deemed to  
conflict with the interests of the indemnifying party, then the indemnified     
party shall have the right to select a separate counsel and to assume such legal
defense and otherwise to participate in the defense of such action, with the    
expenses and fees of such separate counsel and other expenses related to such   
participation to be reimbursed by the indemnifying party as incurred.           

     (d) If the indemnification provided for in this Section 10.5 is unavailable
or insufficient to hold harmless an indemnified party in respect of any losses, 
claims, damages or liabilities or actions in respect thereof, then each         
indemnifying party shall in lieu of indemnifying such indemnified party         
contribute to the amount paid or payable by such indemnified party as a result  
of such losses, claims, damages, liabilities or actions in such proportion as is
appropriate to reflect the relative fault of Tyler, on the one hand, and the    
Shareholder, on the other, in connection with the statements or omissions which 
resulted in such losses, claims, damages, liabilities or actions as well as any 
other relevant equitable considerations, including the failure to give any      
required notice. The relative fault shall be determined by reference to, among  
other things, whether the untrue or alleged untrue statement of a material fact 
or the omission or alleged omission to state a material fact relates to         
information supplied by Tyler, on the one hand, or the Shareholder, on the      
other, and the parties' relative intent, knowledge, access to information and   
opportunity to correct or prevent such statement or omission. Tyler and the     
Shareholder agree that it would not be just and equitable if contribution       
pursuant to this Section 10.5(d) were determined by pro rata allocation or by   
any other method of allocation which does not                                   
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take account of the equitable considerations referred to above in this Section  
10.5(d). The amount paid or payable by an indemnified party as a result of the  
losses, claims, damages, liabilities or actions in respect thereof referred to  
above in this Section 10.5(d) shall be deemed to include any legal or other     
expenses reasonably incurred by such indemnified party in connection with       
investigating or defending any such action or claim. No person guilty or        
fraudulent misrepresentation (within the meaning of Section 11(f) of the        
Securities Act) shall be entitled to contribution from any person who was not   
guilty of such fraudulent misrepresentation.                                    

10.6  No Transferability of Registration Rights. Except with the prior
written consent of Tyler, the Shareholders' registration rights under Section   
10.2 shall not inure to the benefit of any person to whom any Shares are        
transferred, other than a spouse or descendant of a Shareholder ("Relative"), a 
trust solely for the benefit of a Shareholder or Relative, or a partnership all 
of the equity interests in which are directly or indirectly owned by a          
Shareholder or Relative.                                                        

ARTICLE 11

INDEMNIFICATION AND REMEDIES

11.1  Indemnification by the Shareholders Based on Agreement. Each    
Shareholder agrees jointly and severally to indemnify and hold harmless Tyler   
(and if the transactions contemplated hereby are consummated, the Surviving     
Corporation), from and against any and all claims, losses, obligations, damages,
demands, and liabilities (after giving effect to and reducing the same by (i)   
any net tax benefits realized by Tyler or the Surviving Corporation as a result 
of such event, and (ii) the net amount of any insurance proceeds received by    
Tyler or the Surviving Corporation as a result of such event), including,       
without limitation, costs and expenses of litigation (including reasonable      
attorneys' and accountants' fees) (collectively, "Tyler Indemnified Losses"),   
based on, relating to, or arising out of, or any allegation by any third party  
of, any facts or circumstances that would constitute a breach by the            
Shareholders of any representation, warranty, or covenant contained herein or in
any agreement executed pursuant hereto, but excluding from this covenant to     
indemnify any claims or liabilities separately covered by Section 10.5 hereof or
any Customer Claims (hereinafter defined) to the extent and only while covered  
by the provisions of Section 11.3 hereof.                                       

11.2  Indemnification by Tyler Based on Agreement. Tyler (and if the  
transactions contemplated hereby are consummated, the Surviving Corporation)    
agrees to indemnify and hold harmless the Shareholders from and against any and 
all claims, losses, expenses, obligations, demands and liabilities (after giving
effect to and reducing the same by (i) any net tax benefits realized by the     
Shareholders as a result of such event, and (ii) the net amount of any insurance
proceeds received by the Shareholders as a result of such event), including,    
without limitation, costs and expenses of litigation and including reasonable   
attorneys' and accountants' fees (collectively, "Shareholder Indemnified        
Losses"), based on, relating to, or arising out of, or any allegation by any    
third party of, any facts or circumstances that would constitute a breach by    
Tyler of any representation, warranty, or covenant contained herein or in any   
agreement executed pursuant hereto, but excluding from this covenant to         
indemnify any claims or liabilities separately covered by the provisions of     
Section 10.5 hereof.                                                            

     11.3  Customer Claims. If any claim, demand, or cause of action of the type
referred to in Section 11.1 is asserted by a customer of the Company ("Customer 
Claim"), the following provisions shall be applicable until such time as the    
Customer Claim results in a filed and pending lawsuit or other judicial         
proceeding (at which time the provisions of Section 11.1 shall be applicable):  

    (a) Tyler or the Surviving Corporation shall promptly notify the
     Shareholders in writing that a Customer Claim has been made, describing the
nature of the Customer Claim to the extent then known.                

       (b) After receipt of Tyler's or the Surviving Corporation's written
notice, the parties hereto will fully cooperate with each other to    
    investigate the Customer Claim and determine whether the parties can agree
that the Customer Claim is an obligation or liability for which the   
Shareholders are responsible. The investigation shall be conducted    
expeditiously and with all reasonable due diligence, considering the  
circumstances surrounding the Customer Claim.                         
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          (c) If, after an investigation, Tyler or the Surviving Corporation and
    the Shareholders agree in writing that the Customer Claim is an obligation
   or liability for which the Shareholders are responsible, the Shareholders
   and Tyler or the Surviving Corporation agree to use their reasonable best
efforts to reach an agreement with the customer as to the terms and   
     conditions of settlement, compromise or satisfaction of the Customer Claim,
   including, but not limited to, the amount that the Shareholders shall pay
    to the customer for the damages, losses, costs or expenses incurred by it.

       (d) If the provisions of this Section 11.3 are applicable, Tyler or
   the Surviving Corporation shall conduct all communications and settlement
    negotiations with the customer and shall convey to the customer any offers
of settlement or compromise by the Shareholders. Any amounts that the 
   Shareholders agree so to pay in settlement of the Customer Claim shall be
    paid by them to Tyler or the Surviving Corporation, as the case may be, in
trust for payment over to the customer. If Tyler or the Surviving     
    Corporation agrees to pay the customer an amount in excess of that offered
  for settlement purposes by the Shareholders, the excess shall be paid by
   Tyler or the Surviving Corporation, as the case may be, without any right
   to indemnification therefor from the Shareholders. If the amounts so paid
  and entrusted to Tyler or the Surviving Corporation are paid over to the
    customer, the payment over shall be deemed to be a release by Tyler or the
  Surviving Corporation of any further claim with respect to that Customer
Claim against the Shareholders and Tyler and the Surviving Corporation
shall indemnify and hold harmless the Shareholders from any further   
liability with respect thereto.                                       

  (e) In the absence of an agreement among the parties as to the
 settlement of any Customer Claim not involving litigation, Tyler or the
 Surviving Corporation may take such action with respect to the Customer
   Claim as Tyler in its sole judgment may deem necessary or advisable under
the circumstances to settle, compromise or satisfy the Customer Claims
     provided; however, neither Tyler nor the Surviving Corporation shall in any
such event be considered to have waived its right to pursue a judicial
action to determine its right against the Shareholders.               

        (f) An indemnified party shall give notice to the indemnifying party
or parties within 15 business days after actual receipt of service or 
    summons to appear in any action begun in respect of which indemnity may be
    sought hereunder, or actual notice of assertion of a claim with respect to
    which it seeks indemnification. Except as provided in Section 4.5, failure
    so to notify the indemnifying party or parties shall cause the indemnified
party to lose its right to indemnification under this Article 11, but 
  failure so to notify the indemnifying party or parties shall not relieve
 the indemnifying party or parties from any liability that they may have
     other than on account of this Article 11. The indemnifying party or parties
    may participate at their own expense and with their counsel in the defense
of such action.                                                       

    Except as otherwise provided in Section 11.3(d), if the indemnifying party
or parties so elect within a reasonable time after receipt of such notice they  
may assume the defense of such action with counsel chosen by the indemnifying   
party or parties and approved by the indemnified party in such action, unless   
the indemnified party reasonably objects to such assumption on the ground that  
its counsel has advised it that there may be legal defenses available to it that
are different from or in addition to those available to the indemnifying party  
or parties and counsel for the indemnifying party concurs in such advice, in    
which case the indemnified party shall have the right to employ counsel approved
by the indemnifying party or parties. If the indemnifying party or parties      
assume the defense of such action, the indemnifying party or parties shall not  
be liable for fees and expenses of counsel for the indemnified party incurred   
thereafter in connection with such action. In no event shall the indemnifying   
party or parties be liable for the fees and expenses of more than one counsel   
for the indemnified parties in connection with any one action or separate but   
similar or related actions in the same jurisdiction arising out of the same     
general allegations or circumstances unless, in the reasonable opinion of such  
counsel, there is, under applicable standards of professional conduct, a        
conflict on any significant issue between the positions of any two or more      
indemnified parties.                                                            

   11.4  Claims Limitations. Notwithstanding anything otherwise contained in
this Agreement, no party hereto shall assert any single claim or claims against 
any other party hereto, unless the single claim (after giving effect to and     
reducing the same by (i) any net tax benefits realized by the indemnified party 
as a result of such event, and (ii) the net amount of any insurance proceeds    
received by the indemnified party as a result                                   
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of such event) exceeds the sum of $18,750, and the sum of all such single claims
in the aggregate exceeds $150,000; provided, that claims made by Tyler or the   
Surviving Corporation pursuant to Section 2.9 or 4.5 of this Agreement, or for  
breach of the Employment Agreement or the Confidentiality Agreement shall not be
subject to the foregoing limitations; and provided further, that claims made by 
the Shareholders pursuant to Section 3.7 or 4.5 of this Agreement, or for breach
of the Employment Agreement or the Confidentiality Agreement shall not be       
subject to the foregoing limitations.                                           

11.5  Maximum Liability. The maximum aggregate liability of the       
Shareholders to Tyler or the Surviving Corporation for all claims made by Tyler 
or the Company pursuant to this Agreement is $3,000,000; provided, that claims  
made by Tyler or the Surviving Corporation pursuant to Sections 2.9 or 4.5 of   
this Agreement, or for breach of the Employment Agreement or the Confidentiality
Agreement, shall not be subject to the foregoing limitation. The maximum        
aggregate liability of Tyler or the Surviving Corporation to the Shareholders   
for all claims made by the Shareholders pursuant to this Agreement is           
$3,000,000; provided, that claims made by the Shareholders pursuant to Section  
3.7 or 4.5 of this Agreement, or for breach of the Employment Agreement or the  
Confidentiality Agreement, shall not be subject to the foregoing limitation. Any
claim based upon facts and circumstances that would, if true, constitute a      
breach of any representation, warranty or covenant contained in this Agreement  
shall be subject to the limitations contained herein, notwithstanding the fact  
that such claim is asserted by a cause of action or legal theory other than     
breach of contract. When calculating the amount of liability in a claim for     
damages for purposes of this Section 11.5 (whether such calculation is through  
agreement of the parties, litigation or otherwise) and the claim relates to the 
breach of a representation as to the income of the Company for any period or    
periods prior to the Closing Date, all of the parties hereto agree that, in     
determining the amount involved in the claim, the damages shall be actual       
damages incurred and proven and such actual damages shall not be computed by    
using a multiplier or capitalization rate.                                      

    11.6  Equitable Remedies. The parties hereto acknowledge that a refusal by
a party to consummate the transactions contemplated hereby will cause           
irreparable harm to the other parties, for which there may be no adequate remedy
at law. A party not in default at the time of such refusal shall be entitled, in
addition to other remedies at law or in equity, to specific performance of this 
Agreement by the party that refused to consummate the transactions contemplated 
hereby.                                                                         

11.7  Remedies of the Surviving Corporation. After the Closing, the   
Surviving Corporation shall have the same rights and benefits under this        
Agreement as does Tyler with respect to the representations, warranties and     
covenants of the Shareholders contained herein, as fully as if such             
representations, warranties and covenants had been made to the Surviving        
Corporation in lieu or in place of Tyler or Sub. In any proceeding by the       
Surviving Corporation to assert or prosecute any claims under, or to otherwise  
enforce, this Agreement on behalf of itself or Tyler, each Shareholder agrees   
that he shall not assert as a defense or bar to recovery by the Surviving       
Corporation, and hereby waives any right to so assert such defense or bar such  
recovery, that (a) prior to Closing, the Company shall have had knowledge of the
circumstances giving rise to the claim being pursued by it; (b) prior to        
Closing, the Company engaged in conduct or took action that caused or brought   
about the circumstances giving rise to its claim, or otherwise contributed      
thereto; (c) the Company is estopped from asserting or recovering upon its claim
by reason of having joined in the representations, warranties and covenants made
by the Shareholders in this Agreement; or (d) the Shareholder has a right of    
contribution from the Surviving Corporation to the extent that there is any     
recovery against him.                                                           

   11.8  Costs of Defense. If any claim for which an indemnified party seeks
indemnification under this Article 11 results in a judgment that no damages are 
due the claimant on a basis for which the indemnifying party is responsible     
hereunder, then, as between the indemnifying and indemnified parties, the       
indemnified parties shall be liable for any damages awarded and the costs       
(including attorneys' fees) of defending such claim.                            

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ARTICLE 12

MISCELLANEOUS 

12.1  Breach Discovered Prior to Closing.                             

(a) If, prior to the Time of Closing, Tyler has actual and certain    
knowledge (as opposed to an opinion or belief) of any facts or circumstances    
that it determines would constitute a failure to satisfy the conditions to the  
obligations of Tyler to close this Agreement contained in Sections 9.1, 9.2 or  
9.5 hereof, Tyler shall promptly give written notice to the Shareholders. If the
Shareholders fail to cure any such alleged defect within 15 days from the date  
of notice, Tyler shall have the right either to (i) terminate this Agreement    
pursuant to Section 12.2 below, in which case Tyler, shall, if not then in      
default under this Agreement, be entitled to recover from the Company and the   
Shareholders as liquidated damages the actual legal, accounting and other       
out-of-pocket expenses incurred by it in connection with the negotiation,       
preparation and execution of this Agreement and the other agreements and        
instruments referred to herein, its investigation and examination of the affairs
of the Company, and other actions taken preparatory to consummating the         
transactions contemplated hereby, or (ii) waive such defect as a condition to   
closing this Agreement, in which case Tyler shall not be entitled to make any   
claims against the Shareholders pursuant to this Agreement or to exercise any   
other remedial rights with respect to such alleged defect.                      

(b) If, prior to the Time of Closing, the Shareholders have actual and
certain knowledge (as opposed to an opinion or belief) of any facts or          
circumstances that the Shareholders determine would constitute a failure to     
satisfy the conditions to the obligations of the Company and the Shareholders to
close this Agreement contained in Sections 8.1, 8.2 and 8.4 hereof, the Company 
and the Shareholders shall promptly give written notice to Tyler. If Tyler fails
to cure any such alleged defect, the Company and the Shareholders shall have the
right either to (i) terminate this Agreement pursuant to Section 12.2 below, in 
which case the Company and the Shareholders shall, if not then in default under 
this Agreement, be entitled to recover from Tyler as liquidated damages the     
actual legal, accounting and other out-of-pocket expenses incurred by them (but 
not including such expenses incurred to appropriately document the corporate    
records and transactions of the Company and the Shareholders) in connection with
the negotiation, preparation and execution of this Agreement and the other      
agreements and instruments referred to herein, their investigation and          
examination of the affairs of Tyler, and other actions taken preparatory to     
consummating the transactions contemplated hereby, or (ii) waive such defect as 
a condition to closing this Agreement, in which case the Shareholders shall not 
be entitled to make any claims against Tyler or the Surviving Corporation       
pursuant to this Agreement or to exercise any other remedial rights with respect
to such alleged defect.                                                         

    12.2  Termination. This Agreement and the transactions contemplated hereby
may be terminated at any time on or before the Closing Date:                    

(a) by mutual consent of Tyler and the Shareholders;        

         (b) by Tyler if there has been a material misrepresentation or breach
  of warranty in the representations and warranties of the Company and the
    Shareholders set forth herein or if there has been any material failure on
the part of the Company or the Shareholders to comply with their      
obligations hereunder;                                                

          (c) by the Shareholders if there has been a material misrepresentation
  or breach of warranty in the representations and warranties of Tyler set
     forth herein or if there has been any material failure on the part of Tyler
to comply with its obligations hereunder;                             

(d) by either Tyler or the Shareholders if the transactions 
     contemplated by this Agreement have not been consummated by March 31, 1998,
unless such failure of consummation is due to the failure of the      
terminating party to perform or observe the covenants, agreements, and
conditions hereof to be performed or observed by it at or before the  
Closing Date;                                                         

          (e) by either Tyler or the Shareholders if the conditions precedent to
     its or their obligations to close this Agreement have not been satisfied or
waived by it or them at or before the Closing Date; and               

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(f) by either the Shareholders or Tyler if the transactions 
contemplated hereby violate any non-appealable final order, decree, or
judgment of any court or governmental body or agency having competent 
jurisdiction.                                                         

    12.3  Expenses. If the transactions contemplated by this Agreement are not
consummated, each party hereto shall pay its own expenses incurred in connection
with this Agreement and the transactions contemplated hereby, except as         
otherwise provided in Section 12.1; provided, however, that if the transactions 
contemplated hereby are not consummated because of the failure of either of the 
conditions in Section 9.7 or 9.9 to be satisfied, Tyler shall reimburse the     
Shareholders for their reasonable out-of-pocket expenses incurred in connection 
with this Agreement and the transactions contemplated hereby, not to exceed     
$30,000.                                                                        

   12.4  Disclosure Schedules. The Company Disclosure Schedule and the Tyler
Disclosure Schedule are incorporated herein by reference.                       

12.5  Entire Agreement. This Agreement and the Exhibits and Disclosure
Schedules hereto, the Confidentiality Agreement and the other agreements and    
documents contemplated hereby, contain the complete agreement among the parties 
with respect to the transactions contemplated hereby and supersede all prior    
agreements and understandings among the parties with respect to such            
transactions. Section and other headings, the table of contents and indexes to  
the Disclosure Schedules are for reference purposes only and shall not affect   
the interpretation or construction of this Agreement. The parties hereto have   
not made any representation or warranty except as expressly set forth in this   
Agreement, the Employment Agreement, the Confidentiality Agreement, and the     
Noncompetition Agreements, the Company Disclosure Schedule, the Tyler Disclosure
Schedule or in any agreement, certificate or other document delivered pursuant  
hereto or thereto. The obligations of any party under any agreement executed    
pursuant to this Agreement shall not be affected by this Section.               

    12.6  Survival. All representations and warranties (except those contained
in Sections 2.9 and 2.15) of Tyler, Sub, the Company or the Shareholders        
contained herein, in the Tyler Disclosure Schedule, in the Company Disclosure   
Schedule, or in any exhibit, certificate, document or instrument delivered      
pursuant to this Agreement shall survive the Closing and shall continue in full 
force and effect for two years after the date of Closing. All representations   
and warranties of the Shareholders contained in Section 2.9(b) above shall      
survive the Closing and shall continue in full force and effect after the       
Closing without time limitation. All representations and warranties of the      
Shareholders contained in Sections 2.9(a), (c) and (d) above shall survive the  
Closing and shall continue in full force and effect after the Closing until     
expiration, in accordance with the laws of Texas, of the applicable time period 
in which claims may be judicially asserted for breach of a written contract. All
representations and warranties of the Shareholders contained in Section 2.15    
above shall survive the Closing and shall continue in full force and effect     
after the Closing until expiration, in accordance with applicable law, of the   
applicable time periods in which the taxing authority having jurisdiction may   
assert a claim for failure of or deficiency in the payment of taxes. The        
representations and warranties of the Company shall not survive the Closing.    

12.7  Counterparts. This Agreement may be executed in any number of   
counterparts, each of which when so executed and delivered shall be deemed an   
original, and such counterparts together shall constitute only one original.    

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     12.8  Notices. All notices, demands, requests, or other communications that
may be or are required to be given, served, or sent by any party to any other   
party pursuant to this Agreement shall be in writing and shall be mailed by     
first-class, registered or certified mail, return receipt requested, postage    
prepaid, or transmitted by hand delivery, telegram, or telecopy, addressed as   
follows:                                                                        

(i) If to the Company or the Shareholders:                      

The Software Group, Inc.                      
Jupiter North Technology Park                   
1120 Jupiter Road, Suite 100                    
Plano, Texas 75074                              
Telecopy No.: (972) 516-2284                    

with a copy (which shall not constitute notice) to:       

Andrews & Barth                               
8235 Douglas, Suite 1120                        
Dallas, Texas 75225                             
Attention: John C. Andrews, III                 
Telecopy No.: (214) 691-3070                    

(ii) If to Tyler:                                               

Tyler Corporation                           
2121 San Jacinto Street                         
3200 San Jacinto Tower                          
Dallas, Texas 75201                             
Attention: Chairman of the Board                
Telecopy No.: (214) 754-7821                    

with a copy (which shall not constitute notice) to:       

Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P.    
3400 Texas Commerce Tower                       
600 Travis Street                               
Houston, Texas 77002-3004                       
Attention: Gene G. Lewis                        
Telecopy No.: (713) 223-3717                    

  Each party may designate by notice in writing a new address to which any
notice, demand, request, or communication may thereafter be so given, served, or
sent. Each notice, demand, request, or communication that is mailed, delivered, 
or transmitted in the manner described above shall be deemed sufficiently given,
served, sent and received for all purposes at such time as it is delivered to   
the addressee (with the return receipt, the delivery receipt, the affidavit of  
messenger, or (with respect to a telecopy) the confirmation being deemed        
conclusive evidence of such delivery) or at such time as delivery is refused by 
the addressee upon presentation.                                                

     12.9  Successors and Assigns. This Agreement and the rights, interests, and
obligations hereunder shall be binding upon and shall inure to the benefit of   
the parties hereto and their respective successors and assigns.                 

 12.10  Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Texas (except the choice of law rules  
thereof).                                                                       

     12.11  Waiver and Other Action. This Agreement may be amended, modified, or
supplemented only by a written instrument executed by the parties against which 
enforcement of the amendment, modification, or supplement is sought.            

12.12  Severability. If any provision of this Agreement is held to be 
illegal, invalid, or unenforceable, such provision shall be fully severable, and
this Agreement shall be construed and enforced as if such illegal,              
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invalid, or unenforceable provision were never a part hereof; the remaining     
provisions hereof shall remain in full force and effect and shall not be        
affected by the illegal, invalid, or unenforceable provision or by its severance
(except to the extent such remaining provisions constitute obligations of       
another party to this Agreement corresponding to the unenforceable provision);  
and in lieu of such illegal, invalid, or unenforceable provision, there shall be
added automatically as part of this Agreement, a provision as similar in its    
terms to such illegal, invalid, or unenforceable provision as may be possible   
and be legal, valid, and enforceable.                                           

 12.13  Knowledge. At any time there is a reference in a representation,
covenant or warranty of a party to this Agreement that is qualified by the      
knowledge of such party, the terms "knowledge" or "knows" or "known", or        
"belief" or "believes" shall mean (i) as to the Company and the Shareholders,   
the knowledge or belief of any Shareholder, and (ii) as to Tyler, the knowledge 
or belief of its Chairman of the Board, Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer, Louis A. Waters, or James E. Russell.         

   IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.                                           

                         TYLER CORPORATION

                                 By: /s/ C.A. RUNDELL, JR.

                                              ----------------------------------
                                             C. A. Rundell, Jr., President and
                                   Chief Executive Officer

                                  T2 ACQUISITION CORPORATION

                                 By: /s/ C.A. RUNDELL, JR.

                                              ----------------------------------
                                        C.A. Rundell, Jr., President

                                THE SOFTWARE GROUP, INC.

                              By: /s/ GLENN A. SMITH

                                              ----------------------------------
                                     Glenn A. Smith, President

                              /s/ BRIAN B. BERRY

                                              ----------------------------------
                                        Brian B. Berry, Individually

                              /s/ GLENN A. SMITH

                                              ----------------------------------
                                        Glenn A. Smith, Individually

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   The undersigned execute this Agreement solely to indicate their agreement
to Sections 1.7(c) and 10.1 hereof:                                             

                       /s/ JOANE COGAN

                                            ------------------------------------
                   Joane Cogan

                     /s/ RICK HOFF

                                            ------------------------------------
                 Rick Hoff

                          /s/ DAVID LANDGREN

                                            ------------------------------------
                      David Landgren

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ANNEX I 

                                                                [Download Table]

                        SHAREHOLDERS                          SHARES 
                        ------------                          -------
                                                                     
Brian B. Berry..............................................  824,025
Joane Cogan.................................................  136,475
Glenn A. Smith..............................................  960,500

                                                                [Download Table]

                                                                SHARES  
                                                              SUBJECT TO
                       OPTIONHOLDERS                           OPTIONS  
                       -------------                          ----------
                                                                        
Rick Hoff...................................................    75,000  
David Landgren..............................................    75,000  

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                                                                      APPENDIX C

CERTIFICATE OF AMENDMENT
TO
RESTATED CERTIFICATE OF INCORPORATION 
OF
TYLER CORPORATION 

     Pursuant to the provisions of Section 242 of the General Corporation Law of
the State of Delaware ("DGCL"), Tyler Corporation, a corporation organized and  
existing under and by virtue of the DGCL ("Corporation"), does hereby certify as
follows:                                                                        

    1. The Board of Directors of the Corporation, at a meeting duly called and
held, adopted a resolution setting forth and declaring advisable the following  
proposed amendment to the Restated Certificate of Incorporation of the          
Corporation.                                                                    

Article Fourth, Section 1, of the Restated Certificate of   
Incorporation is hereby amended to read in its entirety as follows:   

        "FOURTH: Section 1. Capitalization. The Corporation is authorized to
  issue One Hundred One Million (101,000,000) shares of capital stock. One
Hundred Million (100,000,000) of the authorized shares shall be common
  stock, one cent ($0.01) par value each ("Common Stock"), and One Million
    (1,000,000) of the authorized shares shall be preferred stock, ten dollars
($10.00) par value each ("Preferred Stock").                          

       "Each holder of shares of capital stock of the Corporation shall at
   every meeting of the stockholders be entitled to one vote in person or by
proxy for each share of capital stock of the Corporation held by the  
stockholder, unless otherwise specifically provided pursuant to this  
Restated Certificate of Incorporation."                               

2. Pursuant to a resolution of the Board of Directors, the foregoing  
amendment was presented to the stockholders of the Corporation at a special     
meeting of the stockholders of the Corporation duly called and held for such    
purpose, and the foregoing amendment was approved by the vote of a majority of  
the shares of capital stock of the Corporation entitled to vote thereon in      
accordance with the provisions of Section 242 of the DGCL.                      

 3. Said amendment was duly adopted in accordance with the provisions of
Section 242 of the DGCL.                                                        

4. This Certificate of Amendment shall be effective upon the filing   
thereof.                                                                        

IN WITNESS WHEREOF, the Corporation has caused this Certificate of    
Amendment to its Restated Certificate of Incorporation to be executed on the    
day of           , 199 .                                    

                         TYLER CORPORATION

           By:

                                              ----------------------------------
                                             C.A. Rundell, Jr.
                                             President and Chief Executive
                                               Officer

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TYLER CORPORATION 

THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF THE COMPANY 

   The undersigned hereby (1) acknowledges receipt of the Notice dated January
21, 1998, of the special meeting of stockholders of Tyler Corporation (the      
"Company") to be held at San Jacinto Tower, Suite 2820, 2121 San Jacinto Street,
Dallas, Texas, on February 19, 1998, at 11:00 a.m., Dallas time, and the Proxy  
Statement in connection therewith, and (2) appoints Louis A. Waters and C.A.    
Rundell, Jr., and each of them, as proxies with full power of substitution and  
revocation, for and in the name, place, and stead of the undersigned, to vote   
upon and act with respect to all of the shares of Common Stock of the Company   
standing in the name of the undersigned or with respect to which the undersigned
is entitled to vote and act at said meeting and at any postponements or         
adjournments thereof, and the undersigned directs that this proxy be voted as   
indicated on the reverse side hereof. If only one of the above proxies shall be 
present in person or by substitute at such meeting or at any postponements or   
adjournments thereof, that proxy so present and voting, either in person or by  
substitute, shall exercise all of the powers hereby given.                      

    The undersigned hereby revokes any proxy or proxies heretofore given to vote
upon or act with respect to such stock and hereby ratifies and confirms all that
said proxies, their substitutes, or any of them may lawfully do by virtue       
hereof.                                                                         

                                                                     SEE REVERSE

           CONTINUED AND TO BE SIGNED AND DATED ON OTHER SIDE       SIDE

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[X] Please mark votes as in this example                                        

THIS PROXY WILL BE VOTED AS SPECIFIED BELOW. IF NO SPECIFICATION IS MADE, THIS  
PROXY WILL BE VOTED FOR THE MATTERS SPECIFICALLY REFERRED TO BELOW.             

1. Approval and adoption of a Second Amended and Restated Agreement and Plan of 
 Merger, dated as of December 29, 1997, and effective as of October 8, 1997,
among the Company, T1 Acquisition Corporation, Business Resources         
Corporation, and William D. Oates.                                        

[ ] FOR          [ ] AGAINST          [ ] ABSTAIN 

2. Approval and adoption of an Amended and Restated Agreement and Plan of       
 Merger, dated as of December 29, 1997, and effective as of October 8, 1997,
among the Company, T2 Acquisition Corporation, The Software Group, Inc.,  
Glenn A. Smith, and Brian B. Berry.                                       

[ ] FOR          [ ] AGAINST          [ ] ABSTAIN 

3. Approval of the amendment to the Restated Certificate of Incorporation to    
 increase the number of authorized shares of Common Stock from 50,000,000 to
100,000,000.                                                              
[ ] FOR          [ ] AGAINST          [ ] ABSTAIN 
4. In the discretion of the proxies on any other matter that may properly come  
before the meeting or any postponements or adjournments thereof.          

                     MARK HERE FOR
                          ADDRESS CHANGE [ ]
                        AND NOTE AT LEFT
                                            Please date this proxy and sign your
                                          name exactly as it appears hereon.
                                           Where there is more then one owner,
                                            each should sign. When signing as an
                                          attorney, administrator, executor,
                                        guardian, or trustee, please add
                                           your title as such if executed by a
                                        corporation, the proxy should be
                                            signed by a duly authorized officer.

                                            Please sign this proxy and return it
                                          promptly whether or not you expect
                                      to attend the meeting. You may
                                          nevertheless vote in person if you
                  do attend.

                                            ------------------------------------
                                    Signature               Date

                                            ------------------------------------
                                    Signature               Date

--------------------------------------------------------------------------------