8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) November 20, 2007

IKON Office Solutions, Inc.

(Exact name of registrant as specified in its charter)

_____________________________________________

OHIO	File No. 1-5964	23-0334400
(State or other	(Commission File	(IRS Employer
jurisdiction of	Number)	Identification
incorporation)		Number)

  70 Valley Stream Parkway, Malvern, Pennsylvania      19355   

Registrant’s telephone number, including area code: (610) 296-8000

                          Not Applicable                         

   (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o                 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o                 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

x Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01.   Entry into a Material Definitive Agreement.

Amendment to Confidentiality Agreement with Steel Partners II, L.P.

On November 20, 2007, IKON Office Solutions, Inc. (the “Company”) entered into an Amendment (the “Amendment”) to the Confidentiality Agreement dated as of October 12, 2007 (the “Confidentiality Agreement”), between the Company and Steel Partners II, L.P. (“Steel Partners”). For reference purposes only, the Confidentiality Agreement is furnished as exhibit 99.1 to this report.

The Amendment extends the term of the standstill provisions of the Confidentiality Agreement for an additional period of eighteen (18) months, and further expands the scope of such standstill provisions to include, among other things, that Steel Partners may not propose any person for nomination or election as director of the Company or otherwise seek to include any matter for consideration at a meeting of the Company’s shareholders, and may not otherwise act to seek control or influence the Company’s management, board of directors, or policies, including through communications regarding strategic, recapitalization, or potential material transactions, subject to certain limited exceptions.

The standstill restrictions set forth in the Amendment are subject to the Company meeting certain conditions in connection with a recapitalization transaction including (i) an offer to repurchase at least $295,000,000 of its common stock using a so-called "modified Dutch auction," and (ii) additional repurchases during fiscal 2008 as necessary to reach $500,000,000 of share repurchases, subject to financing and market conditions, as well as applicable regulations (the “Buyback Transaction”). In addition, the Company agreed that it would not amend its Articles of Incorporation or Code of Regulations to restrict the ability of shareholders to nominate candidates for election to its Board of Directors.

The Amendment is filed as Exhibit 10.1 to this report. The foregoing description of the Amendment is qualified in its entirety by reference to the amendment.

Commitment Letter

Subject to the Commitment Letter, Wachovia Investments, acting alone or through or with affiliates selected by it, has committed, in connection with a proposed offering of senior unsecured floating rate notes due 2011 with an aggregate principal face amount of $150,000,000 by the Company (the “New Notes”), to purchase all of the New Notes.  This report is not an offer to sell, or solicitation to buy, any securities.

The commitment described in the preceding paragraph is subject to execution and delivery of a purchase agreement, indenture, customary registration rights agreement and the New Notes in each case, substantially identical to the documentation for the Company’s existing 7.75% Senior Notes due 2015.

The Commitment Letter is filed as Exhibit 10.2 to this report.  The foregoing description of the Commitment Letter is qualified in its entirety by reference to the actual Commitment Letter.

Item 8.01  Other Events.

On November 20, 2007, the Company announced its plans to commence the Buyback Transaction, as well as its receipt of the commitments set forth in the Commitment Letter. This press release is furnished as Exhibit 99.2 to this report.

Item 9.01.  Financial Statements and Exhibits.

The following exhibit shall be deemed to be filed or furnished, depending on the relevant item requiring such exhibit, in accordance with the provisions of Item 601 of Regulation S-K:

10.1      Amendment to the Confidentiality Agreement

10.2      Commitment Letter

99.1      Confidentiality Agreement between IKON Office Solutions, Inc. and Steel Partners II, L.P.

99.2      Press Release, issued November 20, 2007, filed as Exhibit 99.1 to Schedule TO-C, File No. 001-5964, filed on November 21, 2007 and incorporated herein by reference.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

IKON OFFICE SOLUTIONS, INC.
By:	/s/ Mark A. Hershey
	Mark A. Hershey
	Senior Vice President, General Counsel and Secretary

Dated:  November 21, 2007

EX-10.1

Exhibit 10.1

AMENDMENT NO. 1 TO CONFIDENTIALITY AGREEMENT

AMENDMENT NO. 1 dated as of November 20, 2007 (this “Amendment”), to the CONFIDENTIALITY AGREEMENT (the “Confidentiality Agreement”) dated as of October 12, 2007, between  IKON Office Solutions, Inc., an Ohio corporation, and Steel Partners II, L.P.  Capitalized terms not otherwise defined herein have the meanings ascribed thereto in the Confidentiality Agreement.

WHEREAS, the Parties to the Confidentiality Agreement wish to amend certain provisions of the Confidentiality Agreement as set forth in this Amendment.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

1.The Parties agree that the sixth paragraph of the Confidentiality Agreement starting with “The Interested Party further agrees…” and ending with “not earlier than December 1, 2007” is hereby amended and replaced with the following six paragraphs:

“The Interested Party further agrees that it shall not, and shall cause its affiliates not to, prior to May 19, 2009, directly or indirectly, alone or in concert with others or in any other manner: (1) acquire, agree to acquire, or make any proposal to acquire any securities or assets of the Disclosing Party (other than assets transferred in the ordinary course of its business), acquire “beneficial ownership” (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of any equity securities of the Disclosing Party, or acquire any economic long position in voting securities of the Disclosing Party through the purchase of any equity derivative contract, (2) except at the specific written request of the Disclosing Party, propose to enter into, directly or indirectly, any merger, consolidation, share exchange, recapitalization, business combination or similar transaction involving the Disclosing Party or any of its subsidiaries, (3) solicit proxies or consents from shareholders of the Disclosing Party (whether or not such solicitation is subject to Regulation 14A under the Exchange Act) or otherwise acquire voting power with respect to any equity securities of the Disclosing Party, (4) form, join or in any way participate in a “group” (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to any voting securities of the Disclosing Party or any of its subsidiaries, (5) propose any person for nomination or election as a director of the Disclosing Party or otherwise seek to include any matter for consideration at a meeting of shareholders of the Disclosing Party, (6) otherwise act, alone or in concert with others, to seek to control or influence the management, the board of directors or policies of the Disclosing Party, including by communicating with the board of directors of the Disclosing Party, management, employees or shareholders of the Disclosing Party to the effect that the board of directors of the Disclosing Party should engage in a strategic transaction or recapitalization transaction or otherwise with respect to potential material transactions or changes in corporate strategy or corporate governance, (7) request a waiver or amendment of this paragraph, (8) take any action that would reasonably be expected to require the Disclosing Party to make any announcement regarding any of the foregoing, (9) disclose any intention, plan or arrangement inconsistent with the foregoing, or (10) assist, advise or encourage any other person in doing any of the foregoing; provided, however, that (i) the restrictions contained in this paragraph shall not apply to (A) any proposal by the Interested Party to acquire any securities or assets of the Disclosing Party made to the board of directors of the Disclosing Party only after the board has publicly announced a determination to solicit offers or proposals for the purchase of all or a material portion of the securities or assets of the Disclosing Party; (B) any bona fide proposal by the Interested Party to acquire more than 25% of the Disclosing Party’s common stock (the “Common Stock”) made to the board of directors of the Disclosing Party in response to a public unsolicited offer or proposal by a third party unaffiliated with the Interested Party (and not acting in concert with the Interested Party) to acquire more than 25% of the Common Stock or more than 25% of the Disclosing Party’s consolidated total non-current assets, unless such unsolicited offer or proposal is publicly opposed by the Disclosing Party within 20 days of its public disclosure; or (C) any announcement or activities of the Interested Party in support of or in opposition to any proposal for consideration by the shareholders of the Disclosing Party at any meeting of shareholders or by written consent of shareholders of the Disclosing Party that has been proposed by the board of directors or management of the Disclosing Party; and (ii) in response to an public unsolicited offer or proposal by a third party unaffiliated with the Interested Party (and not acting in concert with the Interested Party), other than a current shareholder of the Disclosing Party, to acquire more than 25% of the Common Stock or more than 25% of the Disclosing Party’s consolidated total non-current assets or any proposal for consideration by the shareholders of the Disclosing Party at any meeting of shareholders or by written consent of shareholders of the Disclosing Party that has been proposed by any third party unaffiliated with the Interested Party (and not acting in concert with the Interested Party), other than a current shareholder of the Disclosing Party, the Interested Party may make public statements as to whether it is or is not in favor of such offer or proposal or as to how it intends to vote with respect to such proposal, as applicable.

Notwithstanding anything herein to the contrary, the restrictions contained in the immediately preceding paragraph shall terminate on the earliest of (1) November 26, 2007, if on that date the Disclosing Party has not “commenced” (within the meaning of Rule 14d-2(a) of the Exchange Act) a Recapitalization Transaction that consists of an equity self-tender offer in which the Disclosing Party offered to repurchase at least $295,000,000 of the Common Stock using a so-called “modified Dutch auction” structure with a pricing range of $13.00 to $15.00 per share (a “Qualified Recapitalization Transaction”), (2) December 31, 2007, if on that date the Disclosing Party has not completed a Qualified Recapitalization Transaction, unless (A) on December 31, 2007, the only conditions to such offer that remain unsatisfied are any conditions relating to receipt of necessary consents from existing debtholders and funding of the Disclosing Party’s financing, and (B) the Disclosing Party reasonably believes, and can reasonably demonstrate to the Interested Party the likelihood that, such offer will be consummated by January 15, 2008, (3) January 15, 2008, if on that date the Disclosing Party has not completed a Qualified Recapitalization Transaction, (4) September 30, 2008, if between November 19, 2007 and that date the Disclosing Party has not repurchased Common Stock with an aggregate purchase price (including brokers’ fees and commissions) of at least $500,000,000, unless the primary reason for the aggregate repurchases being less than $500,000,000 is that the beneficial ownership of Common Stock by a particular shareholder (other than State Street Bank and Trust Company) has been during such period sufficiently high as to impair the ability of the Disclosing Party to repurchase Common Stock without causing such shareholder to exceed 14.9% of the outstanding Common Stock, and (5) March 31, 2008, unless by that date the Disclosing Party has notified the Interested Party that the Disclosing Party has financing, on terms reasonably satisfactory to the Disclosing Party, that together with cash on hand will be sufficient to finance the repurchase by the Disclosing Party of an additional $205,000,000 of Common Stock and (if necessary) to refinance the Disclosing Party’s existing 7.75% Notes due 2015.  The Interested Party shall have no obligation to tender into a Qualified Recapitalization Transaction.

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Until the termination of the restrictions in the second preceding paragraph, the Disclosing Party shall not amend its Articles of Incorporation or Code of Regulations to restrict the ability of its shareholders to nominate candidates for elections as directors of the Disclosing Party.

As soon as practicable following the completion of a Qualified Recapitalization Transaction, the Disclosing Party shall implement a plan for the repurchase of shares of Common Stock with an aggregate purchase price equal to $500,000,000 less the amount purchased in the Qualified Recapitalization Transaction (the “Repurchase Balance”).  Such repurchases may be pursuant to one or more additional equity self-tender offers, accelerated stock repurchase programs or open market share repurchase programs under Rule 10b-18 of the Exchange Act (“Rule 10b-18 Programs”) or a combination thereof.   To the extent the Disclosing Party elects to repurchase Common Stock pursuant to Rule 10b-18 Programs, after April 1, 2008, the Disclosing Party shall use commercially reasonable best efforts to repurchase the maximum number of shares of Common Stock allowable on a daily basis (and shall purchase at least 75% of such maximum on a weekly basis), at the then prevailing market prices for the shares, under the manner, timing, price and volume guidelines of Rule 10b-18(b) of the Exchange Act.  The Disclosing Party shall not be required to repurchase Common Stock pursuant to any Rule 10b-18 Program (1) at a price greater than $17.50 per share (or such other limit as the Disclosing Party and the Interested Party may agree from time to time), (2) on any trading day on which there is a substantial market disruption, (3) if such repurchase would, in the view of counsel to the Disclosing Party, raise a substantial risk of violation of law or non-compliance with the terms of the Disclosing Party’s existing indebtedness or (4) if such repurchase would result in the Interested Party or any other person (other than State Street Bank and Trust Company) beneficially owning more than 14.9% of the outstanding Common Stock.  To the extent the Disclosing Party suspends its repurchase of Common Stock under any Rule 10b-18 Program, the Disclosing Party will promptly notify the Interested Party of such suspension and specify which subsection in the immediately preceding sentence the Disclosing Party is relying on in suspending such repurchase.  The Disclosing Party shall notify the Interested Party promptly after the close of trading on the last trading day of each month during the pendency of any Rule 10b-18 Program the total number of shares of Common Stock outstanding at the end of that month and the dollar value of the Repurchase Balance less the aggregate purchase price of the Common Stock repurchased by the Disclosing Party pursuant to this paragraph at the end of that month.  For purposes of this paragraph, the allowable purchases of Common Stock shall be determined without regard to the “however” clause in Rule 10b-18(b)(4).

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If a tender offer that constitutes a Qualified Recapitalization Transaction expires on or before January 15, 2008, the Disclosing Party will promptly notify the Interested Party of the number of shares of the Common Stock to be repurchased, the number of shares of Common Stock outstanding after such repurchase and the pro-ration factor, if applicable, and the Interested Party shall sell a number of shares of Common Stock sufficient to reduce the aggregate beneficial ownership of shares of Common Stock by the Interested Party and its affiliates to below 14.9% of the outstanding shares of Common Stock (taking into account the consummation of the Qualified Recapitalization Transaction).  Any sales required to be executed by the Interested Party pursuant to the immediately preceding sentence shall be executed through the facilities of the New York Stock Exchange no later than the close of trading on the second complete trading day immediately following such notification (and, for purposes of determining two complete trading days, if the notification is given prior to 9:30 a.m. (New York time) on a trading day, such trading day shall constitute the first of the two complete trading days).

The Disclosing Party agrees that the next meeting of shareholders of the Disclosing Party held for the purpose of electing directors shall not be held prior to February 21, 2008 and that the deadline for the shareholders of the Disclosing Party to submit to the Secretary of the Disclosing Party nominations for the election of directors at such meeting shall be not earlier than December 1, 2007.”

2.In connection with the execution of this Amendment, the Disclosing Party shall issue a press release (the “Press Release”), substantially in the form attached hereto as Exhibit A.  The Disclosing Party shall promptly file with the Securities and Exchange Commission a Form 8-K disclosing the material contents of this Amendment and including as an exhibit thereto an executed copy of this Amendment, together with the Press Release.

3.The Interested Party will be permitted, without prior notice or consultation with the Disclosing Party and its legal counsel, to file with the Securities and Exchange Commission an amendment to its Schedule 13D with respect to the securities of the Disclosing Party disclosing the material contents of this Amendment and including as an exhibit thereto an executed copy of this Amendment.  The Interested Party may also issue its own press release with respect to this Amendment.

4.This Amendment shall be governed by, and construed and enforced in accordance with, the laws of the State of New York without regard to the conflicts of laws principles thereof.  Each Party hereby consents to the exclusive jurisdiction of any Federal court or state court located in the Borough of Manhattan in the City of New York. Each Party hereby waives any right to a trial by jury of any dispute arising under or relating to this Amendment.

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5.Except as expressly set forth herein, the Confidentiality Agreement remains in full force and effect.

IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment No. 1  to Confidentiality Agreement as of the date first written above.

IKON OFFICE SOLUTIONS, INC.
By:	/s/  Matthew J. Espe
	Name:  Matthew J. Espe
	Title:  Chairman and Chief Executive Officer

STEEL PARTNERS II, L.P.
By:	Steel Partners, L.L.C., General Partner
By:	/s/  Warren Lichtenstein
	Name:  Warren Lichtenstein
	Title:  Managing Member

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EX-10.2

Exhibit 10.2

Wachovia Investment Holdings, LLC

Wachovia Capital Markets, LLC

One Wachovia Center

301 South College Street

Charlotte, North Carolina 28288-0737

November 20, 2007

COMMITMENT LETTER

PERSONAL AND CONFIDENTIAL

IKON Office Solutions, Inc.

70 Valley Stream Parkway

Malvern, PA 19355

Attention: Mr. Robert F. Woods, Chief Financial Officer

Dear Mr. Woods:

This commitment letter agreement (together with all exhibits and schedules hereto, the “Commitment Letter”) will confirm the understanding and agreement among Wachovia Investment Holdings, LLC (“Wachovia Investments”) and Wachovia Capital Markets, LLC (“Wachovia Securities” and, collectively with Wachovia Investments, the “Wachovia Parties”, “we” or “us”) and IKON Office Solutions, Inc., an Ohio corporation (the “Company” or “you”).  We understand that the Company proposes to commence a tender offer to purchase shares of its common stock (the “Tender Offer”) for an aggregate purchase price not to exceed $295.0 million.  The date on which the Tender Offer is consummated is referred to as the “Closing Date.”

You have advised us that the total funds needed to finance the Tender Offer (including fees and expenses) will be approximately $300.0 million and that such funds will be provided from the following sources:

·    the issuance by the Company of up to $150.0 million in aggregate principal face amount of senior unsecured floating rate notes due 2011 (the “Notes”) on terms set forth on Exhibit A hereto and otherwise with covenants substantially identical to the Company’s existing 7 ¾% Senior Notes due 2015 (the “Existing 2015 Notes”)) in a Rule 144A private placement issued pursuant to an indenture substantially identical to the Company’s Existing 2015 Indenture (as defined below), except as set forth on Exhibit A hereto; and

·   approximately $150.0 million of existing cash on hand at the Company.

Following the consummation of the Tender Offer, none of the Company or any of its subsidiaries will have any debt outstanding other than (i) as described in the preceding paragraph, (ii) borrowings under credit facilities existing on the date hereof in the ordinary course of business or (iii) as set forth on Exhibit D hereto (such debt described in clauses (ii) through (iv), the “Retained Debt”).

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1.The Commitment.

(a)You have requested that Wachovia Investments commit to purchase the entire amount of the Notes upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and the exhibits hereto.

(b)Based on the foregoing, Wachovia Investments, acting alone or through or with affiliates selected by it, is pleased to confirm to you its commitment to purchase the Notes on the principal terms set forth herein, in the Fee Letter (as defined below) and in the Funding Conditions attached hereto as Exhibit C (the “Commitment”), pursuant to (i) a purchase agreement (the “Note Purchase Agreement”) which shall be substantially identical, except as set forth on Exhibit B hereto, to the purchase agreement by and among the Company and the initial purchasers party thereto dated as of September 16, 2005 (the “Existing 2015 Purchase Agreement”), and (ii) an indenture (the “Indenture”) which shall be substantially identical, except as set forth on Exhibit A hereto, to the indenture by and among the Company and The Bank of New York, as trustee, dated as of September 21, 2005 (the “Existing 2015 Indenture” and, together with the Existing 2015 Purchase Agreement, the Existing 2015 Notes and other related documentation, the “Existing 2015 Note Documentation”).  Without limiting the Commitment, the Notes may be converted to term loans pursuant to the terms of Section 9 of this Commitment Letter.

(c)It is agreed that Wachovia Securities, acting alone or through or with affiliates selected by it, will act as the sole book-runner and sole lead arranger (acting in such roles, the “Arranger”) for the Notes.  The Arranger will have the rights and authority customarily given to financial institutions in such roles, but the Wachovia Parties will have no duties other than those expressly set forth herein.  You agree that no other arrangers or book-runners will be appointed, no other titles will be awarded and no compensation (other than that expressly contemplated by the terms hereof or the Fee Letter referred to below) will be paid in connection with the sale of the Notes unless you and we so agree.  In addition, Wachovia Securities has delivered to you a separate engagement letter dated the date hereof (the “Engagement Letter”) setting forth, among other things, the roles of Wachovia Securities in connection with certain transactions as described therein.

(d)The commitments and agreements of the Wachovia Parties described herein are subject to:

(i)           there not having occurred any event, development or circumstance since June 30, 2007 (the date of the most recent unaudited financial statements delivered to the Arranger as of the date hereof) that has caused or would reasonably be expected to cause any material adverse change in or affecting the business, condition (financial or otherwise), results of operations, assets or liabilities of the Company and its subsidiaries, taken as a whole;

(ii)           not less than 14 consecutive days prior to the Closing Date, the Company will have provided to the Arranger an offering memorandum including information customary for high yield offering memoranda to be used in connection with the offering of the Notes; and

(iii)           the other conditions set forth below or referred to in the Funding Conditions attached hereto as Exhibit B.

2.Fees and Expenses.  In consideration of the execution and delivery of this Commitment Letter by the Wachovia Parties, you agree to pay the fees and expenses set forth in the Fee Letter dated the date hereof (the “Fee Letter”) as and when payable in accordance with the terms thereof.

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3.Indemnification.

(a)The Company hereby agrees to indemnify and hold harmless each of the Wachovia Parties and each of their respective affiliates and all their respective officers, directors, partners, trustees, employees, shareholders, advisors, agents, attorneys and controlling persons and each of their respective heirs, successors and assigns (each, an “Indemnified Person”) from and against any and all losses, claims, damages and liabilities to which any Indemnified Person may become subject arising out of or in connection with this Commitment Letter, the Note Documentation, the Notes, the use of the proceeds therefrom, any of the other transactions contemplated by this Commitment Letter (including, without limitation, any Term Loan Conversion and any documentation related thereto), any other transaction related thereto or any claim, litigation, investigation or proceeding relating to any of the foregoing, regardless of whether any Indemnified Person is a party thereto, and to reimburse each Indemnified Person promptly upon demand for all legal and other expenses reasonably incurred by it in connection with investigating, preparing to defend or defending, or providing evidence in or preparing to serve or serving as a witness with respect to, any lawsuit, investigation, claim or other proceeding relating to any of the foregoing (including, without limitation, in connection with the enforcement of the indemnification obligations set forth herein); provided, however, that no Indemnified Person will be entitled to indemnity hereunder in respect of any loss, claim, damage, liability or expense to the extent that it is found by a final, non-appealable judgment of a court of competent jurisdiction that such loss, claim, damage, liability or expense (i) resulted directly from the gross negligence or willful misconduct of such Indemnified Person or (ii) resulted from a claim brought by the Company against an Indemnified Person for breach in bad faith of such Indemnified Person’s obligations hereunder.  In no event will any Indemnified Person be liable on any theory of liability for indirect, special or consequential damages, lost profits or punitive damages as a result of any failure to purchase any of the Notes contemplated hereby or otherwise in connection with the Notes.  No Indemnified Person will be liable for any damages arising from the use by unauthorized persons of information, projections or other materials sent through electronic, telecommunications or other information transmission systems that are intercepted by unauthorized persons.  Notwithstanding the foregoing, the Indemnified Persons’ right to indemnification in respect to the Tender Offer shall be solely as set forth in the dealer-manager agreement relating thereto.

(b)The Company and the Wachovia Parties agree that if any indemnification or reimbursement sought pursuant to this Section 3 is judicially determined to be unavailable for a reason other than the gross negligence or willful misconduct of such Indemnified Person or the breach in bad faith of an Indemnified Person’s obligations hereunder in connection with a claim brought by the Company against such Indemnified Person, then the Company will contribute to the amount paid or payable by the Wachovia Parties, as the case may be, as a result of such losses, claims, damages, liabilities and expenses for which such indemnification or reimbursement is held unavailable (i) in such proportion as is appropriate to reflect the relative benefits to the Company, on the one hand, and the Wachovia Parties, as the case may be, on the other hand, in connection with the transactions to which such indemnification or reimbursement relates, or (ii) if the allocation provided by clause (i) above is judicially determined not to be permitted, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative faults of the Company, on the one hand, and the Wachovia Parties, on the other hand, as well as any other equitable considerations.

4.Expiration of Commitment.  The Commitment will expire at 10:00 p.m., New York City time, on November 20, 2007 unless on or prior to such time you have executed and returned to the Wachovia Parties a copy of this Commitment Letter and the Fee Letter.  If you do so execute and deliver to the Wachovia Parties this Commitment Letter and the Fee Letter, Wachovia Investments agrees to hold its Commitment available for you until the earliest to occur of (i) the termination of the Tender Offer, (ii) the consummation of the Tender Offer with or without the purchase of the Notes and (iii) 5:00 p.m., New York City time, on January 18, 2008.

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5.Confidentiality.

(a)This Commitment Letter, the Fee Letter, the Engagement Letter and the terms and conditions contained herein and therein may not be disclosed by the Company to any person or entity (other than (i) to such of your officers, directors, employees, agents, representatives and advisors as need to know and agree to be bound by the provisions of this paragraph, (ii) to the extent required by applicable law or compulsory legal process (in which case you agree to inform us promptly thereof to the extent lawfully permitted to do so), (iii) in the case of the Commitment Letter, to the extent required by applicable law or to satisfy applicable disclosure requirements in connection with the Tender Offer or the financing thereof and (iv) in the case of the Commitment Letter, to Moody’s and S&P in connection with obtaining the Ratings) without the prior written consent of the Wachovia Parties.

(b)The Wachovia Parties agree to keep confidential, and to cause their respective affiliates, officers, directors, employees, agents, representatives and advisors (collectively, the “Related Parties”) to keep confidential, any non-public information provided to them by or on behalf of the Company (the “Confidential Information”); provided that such persons shall be permitted to disclose Confidential Information (i) to such of our Related Parties as need to know such Confidential Information and agree to be bound by the provisions of this paragraph; (ii) to the extent required by applicable law or compulsory legal process (in which case you agree to inform us promptly thereof to the extent lawfully permitted to do so); (iii) to the extent requested by any regulatory authority having jurisdiction over the Wachovia Parties or any of their Related Parties; (iv) to the extent that such Confidential Information (A) becomes publicly available other than as a result of a breach of the Commitment Letter by the Wachovia Parties or any of their Related Parties, (B) becomes available to the Wachovia Parties or any of their Related Parties on a non-confidential basis from a source other than the Company, (C) was available to the Wachovia Parties or any of their Related Parties on a non-confidential basis prior to its disclosure by the Company; (v) to the extent that such information is independently developed by the Wachovia Parties; (vi) to actual or potential Purchasers, participants or assignees who have entered into customary confidentiality undertakings or (vii) with the prior written consent of the Company.

(c)You acknowledge that Wachovia Securities and its affiliates (the term “Wachovia Securities,” when used in this paragraph, includes all such affiliates, including Wachovia Investments) may be providing debt financing, equity capital or other services (including financial advisory services) to other companies in respect of which you may have conflicting interests regarding the transactions described herein and otherwise.  Wachovia Securities will not use confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter or its other relationships with you in connection with the performance by Wachovia Securities of services for others, and Wachovia Securities will not furnish any such information to others.  You also acknowledge that Wachovia Securities has no obligation to use, in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, confidential information obtained from others.

6.Assignment and Syndication.

(a)The parties hereto agree that the Wachovia Parties will have the right to syndicate the Notes and the Commitment to one or more groups of financial institutions or other investors, identified by us and reasonably acceptable to you (together with Wachovia Investments, the “Purchasers”).  The Arranger will have the right to manage all aspects of any such syndication, including decisions as to the selection of institutions to be approached and when they will be approached, the acceptance of commitments, the amounts offered, the amounts allocated and the compensation provided.  Upon notice by the Wachovia Parties, at any time and from time to time on or after the effective date hereof and on or prior to June 30, 2008, you will cooperate (and cause your affiliates to cooperate) with the Wachovia Parties in connection with the marketing, offering, sale and issuance of the Notes.  Such cooperation shall include, without limitation: (i) endeavoring to cause the syndication efforts to benefit from the existing investor and lending relationships of the Company; (ii) arranging for direct contact between senior management and other representatives of the Company and the proposed Purchasers (including, without limitation, participating in one or more customary “roadshows” with prospective investors, one-on-one meetings and conference calls); (iii) promptly preparing an offering memorandum relating to the Notes containing such disclosure (including financial information) as would be required by the Securities Act and other applicable laws for an offering registered under the Securities Act and such other disclosure as is customary and appropriate for such a document as reasonably determined by the Arranger; (iv) hosting, with the Wachovia Parties, one or more meetings of prospective Purchasers, and, in connection with any such Purchaser meeting, consulting with the Arranger with respect to the presentations to be made at any such meeting, and making available appropriate officers and representatives to rehearse such presentations prior to such meetings, as reasonably requested by the Arranger; and (v) at your expense, working with the Arranger to obtain a corporate family rating for the Company and ratings for the Notes from Moody’s Investors Service, Inc. (“Moody’s”) and a corporate credit rating for the Company and ratings for the Notes from Standard & Poor’s Ratings Group (“S&P”) (such ratings referred to in this clause (v), the “Ratings”), in the case of each of clauses (i) through (iv), prior to the commencement of the general syndication of the Notes, and in the case of clause (v), at the earliest practicable date.  It is understood and agreed that the Commitment hereunder is not subject to the successful syndication of the Notes.

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(b)To assist the Arranger in its syndication efforts, you agree promptly to prepare and provide to the Arranger such information with respect to the Company and its subsidiaries and the transactions contemplated hereby as it may reasonably request, including all financial information and projections as it may reasonably request, including a business plan for fiscal year 2008 through fiscal year 2011, all in form and substance reasonably satisfactory to the Arranger (the “Projections”).  You hereby represent and covenant that (i) all information other than the Projections (the “Information”) that has been or will be made available to the Wachovia Parties by you or any of your representatives is or will be, when furnished, complete and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made and (ii) the Projections that have been or will be made available to the Wachovia Parties by you or any of your representatives have been or will be prepared in good faith based upon reasonable assumptions.  You further agree to update the Information and the Projections as of the Closing Date for the foregoing representations to be true as of such date.  You understand that in arranging and syndicating the Notes and the Commitment we may use and rely on the Information and Projections without independent verification thereof and that you will promptly notify us of any changes in circumstances that call into question in any material respect the continued reasonableness of any assumption underlying the Projections.

(c)To ensure an orderly and effective syndication of the Notes and the Commitment, you agree that, from the date hereof until the earlier of (i) the termination of the syndication of the Notes as determined by the Arranger and (ii) June 30, 2008, you will not, and will not permit any of your domestic subsidiaries to, syndicate or issue, attempt to syndicate or issue, announce or authorize the announcement of the syndication or issuance of, or initiate or pursue discussions with third parties concerning the syndication or issuance of, any debt facility or debt security of the Company or any of its domestic subsidiaries (other than the syndication of the Notes as contemplated hereby), including any renewals or refinancings of any existing debt facility, without the prior written consent of the Arranger (not to be unreasonably withheld, it being understood that you and we contemplate that one or more Engagement Transactions (as defined in the Engagement Letter) will be carried out prior to June 30, 2008).

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7.Survival.  The provisions of this Commitment Letter relating to the payment of fees and expenses, indemnification and contribution and confidentiality and the provisions of Section 8 hereof will survive the expiration or termination of the Commitment or this Commitment Letter (including any extensions) and the execution and delivery of the Note Documentation, and the provisions of Section 6 hereof will survive the execution and delivery of the Note Documentation.

8.Choice of Law; Jurisdiction; Waivers.

(a)This Commitment Letter will be governed by and construed in accordance with the laws of the State of New York.  The Company hereby irrevocably submits to the non-exclusive jurisdiction of any New York State court or Federal court sitting in the County of New York in respect of any suit, action or proceeding arising out of or relating to the provisions of this Commitment Letter, the Fee Letter or the Engagement Letter and irrevocably agrees that all claims in respect of any such suit, action or proceeding may be heard and determined in any such court.  The parties hereto hereby waive any objection that they may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court, and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.  The parties hereto hereby waive, to the fullest extent permitted by applicable law, any right to trial by jury with respect to any action or proceeding arising out of or relating to this Commitment Letter, the Fee Letter or the Engagement Letter.

(b)No Purchaser will be liable in any respect for any of the obligations or liabilities of any other Purchaser under this Commitment Letter or arising from or relating to the transactions contemplated hereby.

9.Conversion to Term Loans.  Subject to the terms and conditions of this Section 9, the Arranger may, in its sole discretion, convert in whole, but not in part, the Notes to senior unsecured term loans (the “Term Loans”) on substantially the same terms as the Notes (such conversion, the “Term Loan Conversion”).  The Arranger shall notify the Company of any Term Loan Conversion at least ten (10) business days prior to the Conversion Deadline Date (as defined below), but in no event later than the Closing Date.  The effective date of the Term Loan Conversion (the “Conversion Deadline Date”) shall be no earlier than five (5) business days after the Closing Date and no later than ten (10) business days after the Closing Date.  In connection with the syndication of any such Term Loans:

(a)The Company agrees to assist the Arranger in the preparation of a customary confidential information memorandum and other marketing materials to be used in connection with any syndication, including causing such confidential information memorandum to conform to market standards as reasonably determined by the Arranger and, at the request of the Arranger, the preparation of a version of the confidential information memorandum that does not contain material non-public information concerning the Company, its affiliates or its securities for purposes of United States federal and state securities laws (“Material Non-Public Information”).

(b)The Company acknowledges that (i) the Wachovia Parties on your behalf will make Information and Projections available to the proposed syndicate of Purchasers by posting the Information or Projections on IntraLinks or another similar electronic system and (ii) certain prospective Purchasers (such Purchasers, “Public Purchasers”; all other Purchasers, “Private Purchasers”) may have personnel that do not wish to receive Material Non-Public Information with respect to the Company and its affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such entities’ securities.  If requested, you will assist us in preparing materials not containing Material Non-Public Information (the “Public Information Materials”), to be distributed to prospective Public Purchasers.

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(c)Before distribution of any Information or Projections (i) to prospective Private Purchasers, you shall provide us with a customary letter authorizing the dissemination of Information and Projections and (ii) to prospective Public Purchasers, you shall provide us with a customary letter authorizing the dissemination of the Public Information Materials and confirming the absence of Material Non-Public Information therefrom.  In addition, at our request, you shall identify Public Information Materials by clearly and conspicuously marking the same as “PUBLIC”.  You agree that the Wachovia Parties on your behalf may distribute the following documents to all prospective Purchasers, unless you advise us in writing (including by email) within a reasonable time prior to their intended distributions that such material should only be distributed to prospective Private Purchasers: (a) administrative materials for prospective Purchasers such as investor meeting invitations and funding and closing memoranda, (b) notifications of changes to the terms of the Notes and (c) other materials intended for prospective Purchasers after the initial distribution of the Information and Projections, including drafts and final versions of definitive documents with respect to the Notes.  If you advise us that any of the foregoing items should be distributed only to Private Purchasers, then the Wachovia Parties will not distribute such materials to Public Purchasers without further discussions with you.  You agree (whether or not any Information or Projections are marked “PUBLIC”) that Information and Projections made available to prospective Public Purchasers in accordance with this Commitment Letter shall not contain Material Non-Public Information.

10.Miscellaneous.

(a)This Commitment Letter may be executed in one or more counterparts, each of which will be deemed an original, but all of which taken together will constitute one and the same instrument.  Delivery of an executed signature page of this Commitment Letter by facsimile or other electronic transmission will be effective as delivery of a manually executed counterpart hereof.  This Commitment Letter may not be amended or waived except by an instrument in writing signed by the Wachovia Parties and you.

(b)The Company may not assign any of its rights, or be relieved of any of its obligations, without the prior written consent of each of the Wachovia Parties (and any purported assignment without such consent will be null and void).  In connection with any syndication of all or a portion of the Commitment, the rights and obligations of each Purchaser hereunder may be assigned; provided that the Commitment hereunder shall continue in effect notwithstanding any such assignment until the purchase of the Notes on the Closing Date.

(c)This Commitment Letter and the attached Exhibits set forth the entire understanding of the parties hereto as to the scope of the Commitment and the obligations of the Wachovia Parties hereunder.  This Commitment Letter supersedes all prior understandings and proposals, whether written or oral, between any of the Wachovia Parties and you relating to any financing or the transactions contemplated hereby.  This Commitment Letter is in addition to the agreements of the parties contained in the Fee Letter.

(d)This Commitment Letter has been and is made solely for the benefit of the parties signatory hereto, the Indemnified Persons, and their respective heirs, successors and assigns, and nothing in this Commitment Letter, expressed or implied, is intended to confer or does confer on any other person or entity any rights or remedies under or by reason of this Commitment Letter or the agreements of the parties contained herein.

(e)You acknowledge that the Wachovia Parties may be (or may be affiliated with) full service financial firms and as such from time to time may effect transactions for their own account or the account of customers, and hold long or short positions in debt or equity securities or loans of companies that may be the subject of the transactions contemplated by this Commitment Letter.  You hereby waive and release, to the fullest extent permitted by law, any claims you have with respect to any conflict of interest arising from such transactions, activities, investments or holdings, or arising from the failure of any Wachovia Party or any of its affiliates to bring such transactions, activities, investments or holdings to your attention.  In addition, you acknowledge that the transactions contemplated by this Commitment Letter, the Fee Letter and the Engagement Letter are arms-length commercial transactions and that each of the Wachovia Parties is acting as principal and in its own best interests.  You are relying on your own experts and advisors to determine whether the transactions contemplated by this Commitment Letter, the Fee Letter and the Engagement Letter are in your best interests.  You agree that each of the Wachovia Parties will act under this Commitment Letter, the Fee Letter and the Engagement Letter as an independent contractor and that nothing in this Commitment Letter, the Fee Letter, the Engagement Letter, the nature of our services, or in any prior relationship will be deemed to create an advisory, fiduciary or agency relationship between any Wachovia Party on the one hand and the Company, its stockholders or its affiliates on the other hand.

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(f)The Company agrees that the Wachovia Parties have the right to place advertisements in financial and other newspapers and journals at their own expense describing their services to the Company; provided that such Wachovia Party will submit a copy of any such advertisements to the Company for its prior approval, which approval will not be unreasonably withheld.

(g)You agree to provide us, prior to the Closing Date, with all documentation and other information reasonably requested by us to satisfy the requirements of bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the U.S.A. Patriot Act.

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If you are in agreement with the foregoing, kindly sign and return to us the enclosed copy of this Commitment Letter.

      Very truly yours,

WACHOVIA INVESTMENT HOLDINGS, LLC
By:	/s/ Rit N. Amin
	Name:  Rit N. Amin
	Title:    Director

WACHOVIA CAPITAL MARKETS, LLC
By:	/s/ Rit N. Amin
	Name:  Rit N. Amin
	Title:    Director

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Accepted and agreed to as of the

date first above written:

IKON OFFICE SOLUTIONS, INC.
By:	/s/ Richard Obetz
	Name:  Richard Obetz
	Title:    Treasurer

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EXHIBIT A TO COMMITMENT LETTER

SUMMARY OF CERTAIN INDENTURE TERMS

Set forth below is a summary of certain of the terms of the Notes and the documentation related thereto.  Capitalized terms used and not otherwise defined herein have the meanings set forth in the Commitment Letter to which this Exhibit  is attached and of which it forms a part

Notes	Senior unsecured floating rates notes (the “Notes”) in an aggregate principal face amount of up to $150.0 million, which Notes shall be issued with one percent (1%) original issue discount resulting in a funding amount of $148.5 million.
Maturity	December 31, 2011.
Optional Redemption	The Notes may be redeemed, at the option of the Company, in whole or in part, upon not less than 30 days and not more than 60 days notice, at a redemption price (the “Redemption Price”) based on the principal amount being redeemed at the applicable percentage set forth in the schedule below, in each case, plus accrued interest on the principal redeemed:

Date of Redemption	Redemption Price Percentage
Closing Date through 6/30/2008	100.00%
7/1/2008 through 3/31/2009	103.00%
4/1/2009 through 12/31/2009	102.00%
Thereafter	100.00%

Negative Covenants

Consistent with those set forth in the Existing 2015 Indenture; provided, that the Company shall be prohibited from making optional redemptions of the Existing 2015 Notes through tender offers or otherwise or by making open market purchases of such Existing 2015 Notes.

Interest Rate

The Notes shall bear interest at the LIBOR Rate plus the Applicable Margin, payable quarterly. As used herein: “LIBOR Rate” means the rate (adjusted for statutory reserve requirements for eurocurrency liabilities) at which eurodollar deposits for 3 months are offered in the interbank eurodollar market. “Applicable Margin” means (a) from the Closing Date through June 30, 2008, 5.00% and (b) thereafter, 5.75%.

A-1

EXHIBIT B TO COMMITMENT LETTER

SUMMARY OF CERTAIN NOTE PURCHASE AGREEMENT TERMS

Set forth below is a summary of certain of the terms of the Note Purchase Agreement and the documentation related thereto.  Capitalized terms used and not otherwise defined herein have the meanings set forth in the Commitment Letter to which this Exhibit is attached and of which it forms a part

Termination Events

None.

Conditions to Obligation to Purchase

Conditions to be limited to the following: (a)           The accuracy of the representations and warranties substantially identical to those set forth in clauses (i), (ii), (iv), (v), (vi), (vii), (x) and (xi) of Section 1 of the Existing 2015 Purchase Agreement (provided, that to the extent such representations and warranties refer to certain of the Existing 2015 Note Documentation, such references shall be deemed to be references to the applicable Note Documentation). (b)            Delivery of an opinion, dated as of the Closing Date, of Mark A. Hershey, Senior Vice President, General Counsel and Secretary of the Company, to the Purchasers in form and substance substantially identical to the opinion delivered pursuant to the Existing 2015 Purchase Agreement. (c)           Delivery of an opinion, dated as of the Closing Date, of Cravath, Swaine & Moore LLP, counsel to the Company, to the Purchasers in form and substance substantially identical to the opinion delivered pursuant to the Existing 2015 Purchase Agreement. (d)           The Company shall have used its commercially reasonable efforts to obtain and deliver to the Purchasers a letter, dated as of the date of purchase of the Notes or the time of sale thereof and with a “cut-off date” within three days of the date of such letter, from PricewaterhouseCoopers LLP, independent public accountants, in form and substance reasonably satisfactory to the Purchasers, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the final Note Documentation. (e)           There not having occurred any event, development or circumstance since June 30, 2007 (the date of the most recent unaudited financial statements delivered to the Arranger as of the date hereof) that has caused or would reasonably be expected to cause any material adverse change in or affecting the business, condition (financial or otherwise), results of operations, assets or liabilities of the Company and its subsidiaries, taken as a whole.

B-1

(f)           The Notes shall be (i) represented by one or more certificates in definitive global form, (ii) registered with Cede & Co., as nominee of The Depository Trust Company (“DTC”) and eligible for clearance and settlement through DTC and (iii) designated by the NASD Private Offering Resale and Trading through Automatic Linkage Market (“PORTAL”) as market securities in accordance with the rules and regulations adopted by the National Association of Securities Dealers, Inc. relating to trading in PORTAL.

(g)           The Company shall have used its commercially reasonable efforts to deliver such customary closing certificates consistent with those delivered in connection with the offering of the Existing 2015 Notes and as are reasonably requested by the Purchasers.

B-2

EXHIBIT C TO COMMITMENT LETTER

FUNDING CONDITIONS

Capitalized terms used but not defined herein have the meanings assigned to them in the Commitment Letter to which this Exhibit is attached and of which it forms a part.  The purchase of the Notes is conditioned upon satisfaction of, among other things, the conditions precedent summarized below.

(a)   The execution and delivery of the Note Purchase Agreement, the Indenture, a customary registration rights agreement and the Notes consistent with the Commitment Letter (collectively, the “Note Documentation”), in each case, substantially identical to the Existing 2015 Note Documentation (except to the extent set forth on the foregoing Exhibit A and Exhibit B); the fulfillment or waiver in writing of the conditions under the Note Purchase Agreement set forth on the foregoing Exhibit B.

(b)   There shall not exist (pro forma for the Tender Offer and the financing thereof) any default or event of default under any of the Note Documentation or under any other material indebtedness of the Company (including the Existing 2015 Indenture and the Company’s existing amended and restated credit agreement dated as of June 28, 2006, as amended).

(c)   The Tender Offer shall have been consummated (or shall be consummated substantially concurrently with the purchase of the Notes) for an aggregate purchase price not exceeding $295.0 million pursuant to documentation reasonably satisfactory to the Arranger, and no provision thereof shall have been waived, amended, supplemented or otherwise modified without the consent of the Arranger (which consent shall not be unreasonably withheld).

(d)   The Company shall have complied in all material respects with all of its obligations under and agreements in the Commitment Letter, the Fee Letter and the Engagement Letter.

(e)   At least 15 days prior to the Closing Date, the Arranger shall have received (i) audited financial statements of the Company for each of the three fiscal years immediately preceding the Closing Date; (ii) unaudited financial statements for any interim period or periods of the Company ended after the date of the most recent audited financial statements and at least 45 days prior to the Closing Date (which shall have been reviewed by the independent accountants for the Company as provided in Statement on Auditing Standards No. 100); and (iii) customary pro forma financial statements, in each case that are satisfactory in form to the Arranger in its reasonable discretion.  You acknowledge that the pro formas contained in the draft Offer to Purchase heretofore delivered to you meet the requirements of clause (iii) above.

(f)   The Company shall have complied with all other customary closing conditions, including, without limitation: (i) obtaining material third party and governmental consents necessary in connection with the Tender Offer or the financing thereof and (ii) absence of litigation or regulatory action affecting the Tender Offer or the financing thereof.  The Arranger shall have received all documentation and other information reasonably requested by the Purchasers to enable them to comply with the requirements of bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the U.S.A. Patriot Act.

C-1

EXHIBIT D TO COMMITMENT LETTER

RETAINED DEBT

($ in thousands)
Long-Term Corporate Debt
	As of 9/30/2007
Bond issue at stated interest rate of 6.75%, due 2025	$	260,400
Bond issue at stated interest rate of 7.30%, due 2027		94,600
bond issue at stated interest rate of 7.75% due 2015		225,000
Capital lease obligations		13,100
Total Corporate Debt	$	593,100
Long-Term Non-Corporate Debt
	As of 9/30/2007
Asset securitization conduit financing at average interest rate of 7.0%(1)	$	158,666
Notes payable to banks at average interest rate of 6.23%		58
Debt supporting certain lease and residual value guarantees(2)		73,687
Total Non-Corporate Debt	$	232,411

_____________________________________________

(1) In June 2007, IKON’s United Kingdom leasing subsidiaries, IKON Capital PLC and IKON Office Solutions Dublin Limited, replaced their existing asset securitization conduit financing agreement with a new five year agreement (the “New U.K. Conduit”), including a 364 day revolving liquidity facility with a new lender.  The facility size was increased from £95,000 to £105,000.  If the New U.K. Conduit is not renewed at the end of each 364 day period during the life of the agreement or upon expiration, any outstanding balance due converts to an amortizing loan to be repaid with collections from previously funded lease contracts.

(2) Due mainly to certain provisions within IKON’s agreements with GE and other third party syndicators, when the Company is the original equipment lesser (primarily state and local government contracts), IKON is required to record debt (and related assets) for certain lease and residual value guarantees.

In addition to the amounts set forth in the foregoing table, Retained Debt shall also include:

(a)   up to $5.0 million of additional capital lease obligations;

(b)   up to $2.0 million of other debt;

(c)   asset securitization conduit financing in an aggregate principal amount (including amounts set forth in the foregoing table) not to exceed £105.0 million;

(d)   notes payable in an aggregate principal amount (including amounts set forth in the foregoing table) not to exceed $2.0 million; and

(e)   additional debt supporting lease and residual value guarantees.

D-1

EX-99.1

Exhibit 99.1

CONFIDENTIALITY AGREEMENT

Steel Partners II, L.P. (the “Interested Party”) has made a proposal with respect to the recapitalization of IKON Office Solutions, Inc. (the “Disclosing Party” and together with the Interested Party, the “Parties”). The Parties mutually wish to review the feasibility and  appropriateness of such a recapitalization or any similar or comparable transaction (a “Recapitalization Transaction”), in light of other strategic alternatives available to the Disclosing Party. In this connection, the Disclosing Party is prepared to make available to the Interested Party certain information relating to the Disclosing Party (including potential strategic transactions and possible participants or counterparties thereto) which is non-public, confidential or proprietary in nature and which may be disclosed either in written form or orally (the “Confidential Information”).

By execution of this letter agreement (this “Agreement”), the Interested Party agrees to treat all Confidential Information confidentially and to observe the terms and conditions set forth herein. For purposes of this Agreement, “Confidential Information” shall include all information relating to the Disclosing Party (including potential strategic transactions and possible participants or counterparties thereto), regardless of the form in which it is communicated or maintained, that is furnished to the Interested Party or its Representatives (as defined below) by or on behalf of the Disclosing Party in the course of the Parties’ mutual review of a possible Recapitalization Transaction. The term “Confidential Information” shall also include all reports, analyses, notes, compilations,  forecasts, studies or other documents or information prepared by the Interested Party or its Representatives that are based on, contain or reflect any Confidential Information received by it or its Representatives (“Notes”). The term “Representatives” shall include a Party’s directors, officers, employees, partners, affiliates, subsidiaries, agents, advisors, lawyers, accountants, consultants, financial advisors, potential co-investors and financing  sources of the Interested Party in any Recapitalization Transaction or other representatives.

The term “Confidential Information” does not include any information relating to the Disclosing Party that (i) becomes generally available to the public other than as a result of a breach of this Agreement directly or indirectly by the Interested Party or its Representatives who received such information under the terms of this Agreement, (ii) was or becomes available on a non-confidential basis from a source other than the Disclosing Party or its Representatives, provided that the source of such information was not known by the Interested Party to be bound by a confidentiality agreement with, or other contractual, legal or fiduciary obligation of confidentiality to, the Disclosing Party or (iii) has been independently acquired or developed by the Interested Party or its Representatives without violating any of the provisions of this Agreement.

Confidential Information received by the Interested Party will be used solely for the purpose of considering the feasibility and appropriateness of a Recapitalization Transaction. The Interested Party may disclose the Confidential Information to its Representatives to the extent necessary to permit such Representatives to assist it in its consideration thereof, provided, however, (1) that each such Representative shall be bound by the terms of this Agreement to the same extent as if it was a party hereto and the Interested Party shall be responsible for any breach of this Agreement by any of its Representatives, and (2) the Interested Party will not disclose any Confidential Information to potential co-investors or potential financing sources of the Interested Party without the Disclosing Party’s prior written consent, which such written consent shall not be unreasonably withheld. Confidential Information may also be disclosed by the Interested  Party to any regulatory authority having jurisdiction over it as such regulatory authority may request.

Except as otherwise set forth herein, each Party agrees that it will not take any action or cause any action to be taken which would reasonably be expected to create a legal obligation for either Party to make a public announcement regarding the possibility of a Recapitalization Transaction. The Interested Party agrees that during the term of this Agreement, it will not, as a result of knowledge or information obtained from the Confidential Information in connection with a possible Recapitalization Transaction or otherwise, (i) divert or attempt to divert any business, customer or supplier of the Disclosing Party or (ii) employ or attempt to employ or divert any employee of the Disclosing Party; provided, however, that the Interested Party shall not be prohibited from (a) employing any such employee who contacts the Interested Party on his or her own initiative and without any direct or indirect solicitation by the Interested Party, (b) conducting generalized solicitations for employees (which solicitations are not specifically targeted at the Disclosing Party’s  employees) through the use of media advertisements, professional search firms or otherwise, or (c) if the Parties consummate a Recapitalization Transaction pursuant to a definitive agreement that results in the Interested Party substantially  increasing its ownership interest in Disclosing Party and the Disclosing Party ceasing to be publicly traded, employing such persons connected with the Disclosing Party in accordance with such Recapitalization Transaction and in accordance with all applicable laws.

The Interested Party further agrees that, for a period of six months from the date hereof, it will not, and will cause its affiliates not to, in any manner, (1) acquire, agree to acquire, or make any proposal (or request permission to make any proposal) to acquire any securities or assets of the Disclosing Party (other than assets transferred in the ordinary course of its business), unless such acquisition, agreement or making of a proposal shall have been expressly first approved (or in the case of a proposal, expressly first invited) by the Disclosing Party, (2) except at the specific written request of the Disclosing Party, propose to enter into, directly or indirectly, any merger, consolidation, share exchange, recapitalization, business combination or similar transaction involving the Disclosing Party or any of its subsidiaries, (3) solicit proxies or consents from shareholders of the Disclosing Party (whether or not such solicitation is subject to Regulation 14A under the Securities Exchange Act of 1934), (4) form, join or in any way participate in a “group” (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934) with respect to any voting securities of the Disclosing Party or any of its subsidiaries, (5) seek to include any matter for consideration at a meeting of shareholders of the Disclosing Party, (6) otherwise act, alone or in concert with others, to seek to control or influence the management, board of directors or policies of the Disclosing Party, including by communicating with the board of directors, management, employees or shareholders of the Disclosing Party to the effect that the board of directors of the Disclosing Party should engage in a strategic transaction or recapitalization transaction or otherwise with respect to potential material transactions or changes in corporate strategy or corporate governance, (7) disclose any intention, plan or arrangement inconsistent with the foregoing or (8) assist, advise or encourage any other person in doing any of the foregoing. Notwithstanding anything to the contrary contained in the preceding sentence, (v) the restrictions contained in the preceding sentence shall not apply to any proposal by the Interested Party to acquire any securities or assets of the Disclosing Party made to the board of directors of the Disclosing Party or directly to all of the shareholders of the Disclosing Party, in each case only after the board of directors of the Disclosing Party has made a determination to solicit offers or proposals for the purchase of all or a material portion of the securities or assets of the Disclosing Party, (w) the restrictions contained in the preceding sentence shall not apply to any proposal by the Interested Party that is made confidentially by the Interested Party, is not publicly disclosed by the Interested Party (regardless of whether any such public disclosure is legally required) and is not made in such a way as to require public disclosure by the Disclosing Party, (x) the restrictions contained in the preceding sentence shall not apply to any proposal by the Interested Party that is made confidentially in such a way as to not require public disclosure by the Disclosing Party and the proposal is nevertheless publicly disclosed by the Disclosing Party (y) the Interested Party shall be permitted after November 15, 2007 to (A) nominate individuals (the “Interested Party Nominees”) for election as directors of the Disclosing Party at the next meeting of shareholders of the Disclosing Party held for the purpose of electing directors (the “Shareholders Meeting”), (B) solicit proxies from the shareholders of the Disclosing Party for the purpose of electing the Interested Party Nominees at the Shareholders Meeting, (C) form, join or in any way participate in a “group” (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934) with respect to the voting securities of the Disclosing Party or any of its subsidiaries for the purpose of electing the Interested Party Nominees at the Shareholders Meeting, and (D) disclose any intention, plan or arrangement and take any action in connection with any of the foregoing and (z) following the election to the board of directors of the Disclosing Party of any Interested Party Nominee, such Interested Party Nominee may take any action contemplated by the preceding sentence in his or her capacity as a director of the Disclosing Party. The Disclosing Party agrees that the Shareholders Meeting shall not be held prior to February 21, 2008 and that the deadline for the shareholders of the Disclosing Party to submit to the Secretary of the Disclosing Party nominations for the election of directors at the Shareholders Meeting shall be not earlier than December 1, 2007.

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In addition, each Party agrees that it will not, and its Representatives will not, make any disclosure that any discussions concerning a Recapitalization Transaction have been held or are ongoing, that any Confidential Information has been provided or received or that a possible Recapitalization Transaction is being considered; provided, however, that either Party may make such disclosure if such Party has received the advice of its counsel that such disclosure must be made in order that such Party not commit a violation of law or order of any court or governmental or regulatory authority and, to the extent practicable and permissible, prior to such disclosure, such Party promptly advises and consults with the other Party and its legal counsel concerning the information proposed to be disclosed. Notwithstanding anything to the contrary contained herein, the Interested Party will be permitted, without prior notice or consultation with the Disclosing Party and its legal counsel, to file with the Securities and Exchange Commission an amendment to its Schedule 13D with respect to the securities of the Disclosing Party disclosing the material contents of this Agreement and including as an exhibit thereto an executed copy of this Agreement.

The Interested Party understands and acknowledges that neither the Disclosing Party nor any of its officers, directors, employees, affiliates, agents, advisors or representatives (i) has made or makes any representation or warranty,  expressed or implied,  as to the accuracy, completeness or reasonableness of the Confidential Information or (ii) shall have any liability whatsoever to it relating to or resulting from the use of the Confidential Information or any errors therein or omission therefrom. The Interested Party agrees that it is not entitled to rely on the accuracy or completeness of the Confidential Information and that it will be entitled to rely solely on the representations and warranties made in any definitive agreement entered into with respect to a Recapitalization Transaction.

In the event that the Interested Party or anyone to whom it transmits any Confidential Information in accordance with this Agreement is requested or required by law, regulation, regulatory authority or judicial or governmental order or in any court proceeding (by deposition, interrogatories, requests for information or documents, subpoenas, civil investigative demand or similar process), to disclose any Confidential Information, the Interested Party will give the Disclosing Party prompt written notice of such request or requirement (and, to the extent practicable and permissible, before complying with any such request or requirement) so that the Disclosing Party may seek, at the Disclosing Party’s sole expense, an appropriate protective order or other remedy and/or waive compliance with the provisions of this Agreement, and the Interested Party will cooperate with the Disclosing Party to obtain such protective order. In any event, the Interested Party (or such other persons to whom such request is directed) may, without liability hereunder, furnish only that portion of the Confidential Information which, based upon the written advice of the Interested Party’s counsel, is legally required to be disclosed and, upon the Disclosing Party’s request and at its expense, use its commercially reasonable efforts to obtain assurances that confidential  treatment will be accorded to such information.

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The Interested Party agrees that upon the Disclosing Party’s request, or in the event that the Disclosing Party decides not to proceed with a Recapitalization Transaction, the Interested Party will promptly destroy or redeliver to the Disclosing Party all copies of the Confidential Information, destroy all Notes, delete any non-oral information incapable of physical delivery (including, but not limited to, Confidential Information held on any computer or word processor) and deliver to the Disclosing Party a certificate executed by a duly authorized officer indicating that the requirements of this sentence have been satisfied in full. Notwithstanding anything to the contrary contained in this paragraph, the Interested Party and its Representatives are permitted to retain such Confidential Information and Notes as is necessary to enable them to comply with any applicable document retention requirements under applicable law or regulation and to retain any computer records and computer files containing any Confidential Information and Notes if required pursuant to their current automatic archiving and backup procedures; provided, however, that (1) such retention shall be solely for legal, regulatory or archival purposes, as the case may be, and (2) notwithstanding the immediately preceding paragraph, under no circumstances may the Interested Party or any of its Representatives publicly disclose any Confidential Information or Notes that have been retained pursuant to this sentence (and the Interested Party specifically acknowledges that the effect of this clause (2) is that the Interested Party may be prevented from taking certain actions it otherwise would be permitted to take under this letter if such actions would require public disclosure of retained information). Notwithstanding the return, destruction or retention of Confidential Information and Notes, the Interested Party will continue to be bound by its obligations of confidentiality and other obligations hereunder.

Each Party agrees that unless and until a definitive agreement with respect to any Recapitalization Transaction has been executed and delivered, neither of them will be under any legal obligation of any kind whatsoever with respect to such Recapitalization Transaction (other than as contained herein). In addition, each Party expressly understands and agrees that nothing herein shall be deemed to limit or prevent the Interested Party’s or its affiliates’ activities in the ordinary course of business (to the extent such activities will not violate applicable securities laws or this Agreement), including, but not limited to, the investment or consideration for investment by the Interested Party and its affiliates in any entity which is engaged in the same or related fields of business as those engaged (or proposed to be engaged) in by the Disclosing Party.

The Interested Party recognizes and acknowledges the competitive and confidential nature of the Confidential Information and that irreparable damage will result to the Disclosing Party if information contained therein or derived therefrom is disclosed to any third party except as herein provided. The Parties agree that monetary damages would not be a sufficient remedy for any breach of this Agreement, and that either Party shall be entitled to specific performance and injunctive or other equitable relief as a remedy for any such breach by the other Party. Each Party agrees that it will not oppose any application by the other Party for injunctive relief. The Parties further agree to waive, and to use their commercially reasonable efforts to cause their Representatives to waive, any requirements for the securing or posting of any bond in connection with such remedy.

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In the event that any provision or portion of this Agreement is determined to be invalid or unenforceable for any reason, in whole or in part, the remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force and effect to the fullest extent permitted by applicable law. The Parties’ obligations under this Agreement will expire two years from the date of this Agreement, except as otherwise explicitly stated above.

This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York without regard to the conflicts of laws principles thereof. Each Party hereby consents to the exclusive jurisdiction of any Federal court or state court located in the Borough of Manhattan in the City of New York. Each Party hereby waives any right to a trial by jury of any dispute arising under or relating to this Agreement.

Having agreed with the foregoing,  the Parties have executed this Agreement, which will constitute their entire agreement with respect to the matters set forth herein.

Very truly yours,
IKON Office Solutions, Inc.
By:	/s/ Matthew J. Espe
	Name: Matthew J. Espe
	Title: Chairman & Chief Executive Officer

Agreed and Accepted 

STEEL PARTNERS II, L.P. 

By: Steel Partners, L.L.C., General Partner 

/s/ Warren G. Lichtenstein

Name: Warren G. Lichtenstein

Title: Managing Member

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