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Agreement and Plan of Merger

AGREEMENT AND PLAN OF MERGER

XEROX CORPORATION

RG ACQUISITION I CORP.

GLOBAL IMAGING SYSTEMS, INC.

Dated as of April 1, 2007

AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER (the Agreement), dated as of April 1, 2007, by and among Xerox Corporation, a New York corporation (the Parent), RG Acquisition I Corp., a Delaware corporation and a wholly owned subsidiary of the Parent (the Purchaser), and Global Imaging Systems, Inc., a Delaware corporation (the Seller).

A. The boards of directors of each of the Purchaser, the Seller and the Parent have approved the acquisition of the Seller by the Parent on the terms and conditions set forth in this Agreement.

B. Pursuant to this Agreement, and subject to the terms and conditions set forth herein, the Purchaser has agreed to commence a tender offer (the Offer) to purchase all the Sellers common stock, par value $0.01 per share (Seller Common Stock) at a price per share of $29.00 net to the selling stockholders in cash, without interest (such amount or any greater amount per share paid pursuant to the Offer being hereafter referred to as the Offer Price).

C. The board of directors of the Seller has (A) by unanimous vote of the directors (i) determined that this Agreement, the Offer and the Merger (as defined below) are advisable, and in the best interest of the Seller and its stockholders, (ii) approved the Offer and the merger of the Purchaser with and into the Seller, with the Seller as the surviving corporation (the Merger and, with the Offer and the other transactions contemplated hereby, the Transaction) in accordance with the General Corporation Law of the State of Delaware (the DGCL) and (iii) approved this Agreement and (B) is recommending that the Sellers stockholders accept the Offer, tender their shares of Seller Common Stock into the Offer, approve the Merger and adopt this Agreement.

D. The parties desire to make certain representations, warranties and agreements in connection with the Transaction and to prescribe certain conditions to the Transaction.

In consideration of the foregoing and the mutual covenants, representations, warranties and agreements contained herein, and intending to be legally bound hereby, the parties agree as follows:

(a) Provided that this Agreement shall not have been terminated in accordance with Article IX hereof and none of the events set forth in Annex I hereto (the Tender Offer Conditions) shall have occurred and be continuing, on April 4, 2007 (or such other day as the parties shall agree in writing), the Parent shall cause the Purchaser (and the Seller shall cooperate with the Parent and the Purchaser) to commence (within the meaning of Rule 14d-2 of the Exchange Act) an offer to purchase all outstanding shares of Seller Common Stock at the Offer Price and shall use its reasonable best efforts to consummate the Offer, subject to the terms and conditions hereof and thereof. Subject to the terms and conditions of this Agreement and to the satisfaction or waiver of the Tender Offer Conditions, the Purchaser shall, and the Parent shall cause it to, promptly after the expiration of the Offer, accept for payment, and pay for (after giving effect to any required withholding Tax), all shares of Seller Common Stock validly tendered pursuant to the Offer and not withdrawn (the time and date of acceptance for payment, the Acceptance Date).

(b) The Purchaser expressly reserves the right, in its sole discretion, to waive, in whole or in part, any Tender Offer Condition or modify the terms of the Offer; provided, however, that without the prior written consent of the Seller, the Purchaser shall not decrease the Offer Price or change the form of consideration payable in the Offer, waive or amend the Minimum Condition (as defined in Annex I hereto), decrease the number of shares of Seller Common Stock sought to be purchased in the Offer, impose additional conditions to the Offer or amend any other term of the Offer in any manner adverse to the holders of shares of Seller Common Stock. The Offer shall remain open until 12:00 midnight, New York time, on the date that is twenty-five (25) Business Days after the commencement (determined pursuant to Rule 14d-1(g)(3) under the Exchange Act) of the Offer (the Expiration Date), unless the Purchaser shall have extended the period of time for which the Offer is open pursuant to, and in accordance with, the succeeding sentence or as may be required by applicable Laws or interpretations or positions of the Securities and Exchange Commission or its staff (the SEC), in which event the term Expiration Date shall mean the latest time and date as the Offer, as so extended, may expire; provided, however, that the Purchaser may, in its sole discretion, provide a subsequent offering period after the Expiration Date, in accordance with Rule 14d-11 under the Exchange Act. If on any then scheduled Expiration Date, any of the Tender Offer Conditions is not satisfied or waived by the Purchaser, the Purchaser may extend the Offer from time to time; provided, however, that, on such Expiration Date, (i) if the waiting period under the HSR Act or under any applicable foreign statutes or regulations applicable to the Offer or the Merger shall have not expired or been terminated, the Purchaser shall extend the Offer from time to time until the expiration or termination under the HSR Act or any other material applicable foreign statutes or regulations or (ii) if any of the Tender Offer Conditions set forth in paragraphs (a) or (b) of Annex I hereto shall have occurred and be continuing, the Purchaser shall extend the Offer from time to time in consecutive increments of up to five (5) Business Days each until the time such condition or conditions shall no longer exist or any of the matters described in such paragraphs (a) or (b) shall have become final and non-appealable; provided, further, however that the Purchaser shall not be required to extend the Offer beyond the Outside Date (defined in Section 9.1(b) below). Nothing contained in this paragraph shall affect any termination rights in Article IX. Subject to the terms of the Offer and this Agreement and the satisfaction of all the Tender Offer Conditions as of the Expiration Date, the Purchaser will accept for payment and pay for all shares of Seller Common Stock validly tendered and not validly withdrawn pursuant to the Offer promptly after the Expiration Date of the Offer.

ARTICLE I - THE OFFER			1
	1.1	The Offer	1
	1.2	Seller Actions	3
	1.3	Directors	5
	1.4	Top-Up Option	6

ARTICLE II - THE MERGER			7
	2.1	The Merger	7
	2.2	Closing; Effective Time	7
	2.3	Effects of the Merger	7
	2.4	Certificate of Incorporation and Bylaws	7
	2.5	Directors and Officers	7
	2.6	Stockholders Meeting	7
	2.7	Merger Without Meeting of Stockholders	9

ARTICLE III - EFFECT OF THE MERGER ON THE SELLER CAPITAL STOCK; EXCHANGE OF SHARES			9
	3.1	Conversion of Capital Stock	9
	3.2	Seller Stock-Based Awards	10
	3.3	Exchange of Certificates	10
	3.4	Appraisal Rights	12

ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE PARENT AND THE PURCHASER			13
	4.1	Corporate Organization	13
	4.2	Authority; No Violation	14
	4.3	Consents and Approvals	14
	4.4	Brokers Fees	15
	4.5	Legal Proceedings	15
	4.6	Available Funds	15
	4.7	Certain Compensation Arrangements	15
	4.8	Offer Documents; Proxy Statement; the Parent Information	15
	4.9	No Other Representations or Warranties	16


ARTICLE V - REPRESENTATIONS AND WARRANTIES OF THE SELLER			16
	5.1	Corporate Organization	16
	5.2	Capitalization	17
	5.3	Authority; No Violation	20
	5.4	Consents and Approvals	21
	5.5	Financial Statements	21
	5.6	Brokers Fees	22

	5.7	Absence of Certain Changes or Events	22
	5.8	Legal Proceedings	22
	5.9	Reports	22
	5.10	Absence of Undisclosed Liabilities	24
	5.11	Compliance with Applicable Laws and Reporting Requirements	24
	5.12	Taxes and Tax Returns	25
	5.13	Employee Benefit Programs	27
	5.14	Labor and Employment Matters	30
	5.15	Material Contracts	31
	5.16	Properties	32
	5.17	Environmental, Health and Safety Liability (a)	34
	5.18	State Takeover Laws; Required Stockholder Vote	35
	5.19	Intellectual Property	35
	5.20	Insurance	37
	5.21	Opinion of Sellers Financial Advisors	37
	5.22	Schedule 14D-9; Proxy Statement; Seller Information	37
	5.23	Transactions with Certain Persons	37
	5.24	No Other Representations or Warranties	38

ARTICLE VI - COVENANTS RELATING TO CONDUCT OF BUSINESS			38
	6.1	Conduct of Business Pending the Effective Time	38
	6.2	Certain Tax Matters	41
	6.3	Litigation	42

ARTICLE VII - ADDITIONAL AGREEMENTS			42
	7.1	Third Party Consents and Regulatory Approvals	42
	7.2	No Solicitation	44
	7.3	Access to Information	47
	7.4	Employment and Benefit Matters	48
	7.5	Directors and Officers Indemnification and Insurance	49
	7.6	Additional Agreements	50
	7.7	Advice of Changes	50
	7.8	Publicity	51
	7.9	Rule 16b-3 Actions	51
	7.10	Rule 14d-10 Matters	51
	7.11	Retention Agreements	52
	7.12	2006 Financial Statements	52

ARTICLE VIII - CONDITIONS PRECEDENT TO THE CONSUMMATION OF THE MERGER			52
	8.1	Conditions	52

ARTICLE IX - TERMINATION, AMENDMENT AND WAIVER			53
	9.1	Termination	53
	9.2	Effect of Termination	54
	9.3	Amendment	55
	9.4	Extension; Waiver	56

ARTICLE X - MISCELLANEOUS			56
	10.1	Nonsurvival of Representations, Warranties and Agreements	56
	10.2	Expenses	56
	10.3	Notices	56
	10.4	Interpretation	58
	10.5	Counterparts	58
	10.6	Entire Agreement	58
	10.7	Governing Law; Jurisdiction and Venue; Waiver of Jury Trial	58
	10.8	Consent and Approvals	59
	10.9	Assignment; Reliance of Other Parties	59
	10.10	Specific Performance	59
	10.11	Definitions	59