Matthew J. Espe
                              EMPLOYMENT AGREEMENT
 
         AGREEMENT,  made and entered into as of the 28th day of August, 2002 by
and between IKON Office Solutions,  Inc., an Ohio corporation with its principal
office  located  at  70  Valley  Stream  Parkway,  Malvern,  Pennsylvania  19355
(together with its successors and assigns  permitted under this  Agreement,  the
"Company"), and Matthew J. Espe (the "Executive");
 
                              W I T N E S S E T H:
 
         WHEREAS,  the Company desires to employ the Executive and to enter into
an agreement embodying the terms of such employment;
 
         WHEREAS,  the Executive  desires to accept employment with the Company,
subject to the terms and provisions of this Employment Agreement;
 
         NOW,  THEREFORE,  in consideration of the promises and mutual covenants
contained herein and for other good and valuable  consideration,  the receipt of
which is mutually  acknowledged,  the Company and the Executive  (together,  the
"Parties") agree as follows:
 
         1.       Definitions.
 
                  (a)  "Affiliate"  of a Person shall mean a Person who directly
or indirectly  controls,  is controlled by, or is under common control with, the
Person specified.
 
                  (b) "Agreement"  shall mean this Employment  Agreement,  which
includes for all purposes any exhibits hereto.
 
                  (c)  "Base  Salary"  shall  mean the  salary  provided  for in
Section 4 or any increased  salary granted to the Executive  pursuant to Section
4.
 
                  (d) "Board" shall mean the Board of Directors of the Company.
 
                  (e) "Cause" shall mean:
 
                           (i) the Executive is convicted of a felony  involving
                  moral turpitude; or
 
                           (ii)  the   Executive   engages   in   conduct   that
                  constitutes  willful gross neglect or willful gross misconduct
                  in carrying out his duties under this Agreement, resulting, in
                  either case, in material economic harm to the Company,  unless
                  the Executive believed in good faith that such conduct was in,
                  or not opposed to, the best interests of the Company.
 
                  (f) "Change in Control"  shall mean the  occurrence  of any of
the following events:
 
                           (i) any  "person," as such term is currently  used in
                  Section  13(d) of the  Securities  Exchange  Act of  1934,  as
                  amended,  becomes  a  "beneficial  owner,"  as  such
 
 
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                  term is currently  used in Rule 13d-3  promulgated  under that
                  act, of 20% or more of the Voting Stock of the Company;
 
                           (ii) a majority of the Board  consists of individuals
                  other than Incumbent  Directors,  which term means the members
                  of  the  Board  on  the  Effective  Date;  provided  that  any
                  individual  becoming a director  subsequent to such date whose
                  election  or  nomination  for  election  was  supported  by  a
                  majority of the  directors  who then  comprised  the Incumbent
                  Directors shall be considered to be an Incumbent Director;
 
                           (iii)  the  Company  adopts  any plan of  liquidation
                  providing for the distribution of all or substantially  all of
                  its assets;
 
                           (iv) 50% or more of the  assets  of the  Company  are
                  disposed  of  pursuant  to a  merger,  consolidation  or other
                  transaction or series of transactions (unless the shareholders
                  of the Company immediately prior to such merger, consolidation
                  or other  transaction or series of  transactions  beneficially
                  own,  directly  or  indirectly,   in  substantially  the  same
                  proportion as they owned the Voting Stock of the Company, more
                  than 50% of the Voting Stock or other  ownership  interests of
                  the entity or entities,  if any,  that succeed to the business
                  of the Company); or
 
                           (v) the Company  combines with another company and is
                  the  surviving   corporation   but,   immediately   after  the
                  combination, the shareholders of the Company immediately prior
                  to the combination hold 50% or less of the Voting Stock of the
                  combined  company,  (there being  excluded  from the number of
                  shares  held by such  shareholders,  but not from  the  Voting
                  Stock  of  the  combined  company,   any  shares  received  by
                  Affiliates of such other company in exchange for stock of such
                  other company).
 
                  (g)   "Claim"   shall   mean  any  claim,   demand,   request,
investigation,  dispute, controversy,  threat, discovery request, or request for
testimony or information.
 
                  (h) "Committee"  shall mean the Human  Resources  Committee of
the Board.
 
                  (i) "Common Stock" shall mean common stock of the Company.
 
                  (j)  "Constructive  Termination  Without  Cause"  shall mean a
termination  by the  Executive  of his  employment  hereunder on 30 days written
notice given by him to the Company  following the occurrence,  without his prior
written consent,  of any of the following events,  unless the Company shall have
fully cured all grounds for such termination  within 15 days after the Executive
gives notice thereof:
 
                           (i) any  reduction in his then current Base Salary or
                  in  his  target  or  maximum  annual  bonus  opportunity  as a
                  percentage of Base Salary;
 
                           (ii) any material  failure to timely grant, or timely
                  honor, any equity or long-term incentive award;
 
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                           (iii) any  material  breach  of any of the  Company's
                  obligations, representations or warranties in this Agreement;
 
                           (iv) any failure to appoint,  elect or reelect him to
                  any of the positions  described in the Agreement;  the removal
                  of him from any such position;  or any change in the reporting
                  structure so that he reports to someone other than the Board;
 
                           (v) any  material  diminution  in his  duties  or the
                  assignment to him of duties that materially impair his ability
                  to perform his duties;
 
                           (vi) following any Change in Control,  any relocation
                  of the  Company's  principal  office,  or of his own office as
                  assigned  to him by the  Company,  to a location  more than 50
                  miles from Malvern, Pennsylvania;
 
                           (vii) following any Change in Control, any failure by
                  the  Company to continue  in effect any  compensation  plan in
                  which the  Executive  participated  immediately  prior to such
                  Change in Control  and which is  material  to the  Executive's
                  total compensation, including but not limited to the Company's
                  stock option,  incentive compensation,  deferred compensation,
                  stock purchase,  bonus and other plans or any substitute plans
                  adopted  prior to the Change in Control,  unless an  equitable
                  arrangement  (embodied in an ongoing substitute or alternative
                  plan) has been made with respect to such plan,  or any failure
                  by the  Company  to  continue  the  Executive's  participation
                  therein (or in such substitute or alternative plan) on a basis
                  no less  favorable  to the  Executive,  both in  terms  of the
                  amount of benefits  provided and the level of the  Executive's
                  participation  relative  to  other  participants,  as  existed
                  immediately prior to such Change in Control;
 
                           (viii)  following any Change in Control,  any failure
                  by the  Company to  continue  to provide  the  Executive  with
                  benefits   substantially  similar  to  those  enjoyed  by  the
                  Executive under any of the Company's pension,  life insurance,
                  medical, health and accident, or disability plans in which the
                  Executive was  participating  immediately prior to such Change
                  in  Control,  the  taking of any action by the  Company  which
                  would  directly or  indirectly  materially  reduce any of such
                  benefits or deprive the Executive of any perquisite enjoyed by
                  the  Executive  at the time of such Change in Control,  or the
                  failure by the  Company to  maintain  a vacation  policy  with
                  respect to the Executive  that is at least as favorable as the
                  vacation  policy  (whether  formal or  informal) in place with
                  respect to the Executive  immediately  prior to such Change in
                  Control; or
 
                           (ix)  the  failure  of  the  Company  to  obtain  the
                  assumption  in  writing  of its  obligation  to  perform  this
                  Agreement by any successor to all or substantially  all of the
                  assets  of  the  Company   within  15  days  after  a  merger,
                  consolidation, sale or similar transaction.
 
                  If any of the changes  described in Section  1(j)(vi)  through
1(j)(viii)  is preceded by a Potential  Change in Control,  such change may give
rise to a Constructive  Termination  Without Cause under this Section,  provided
such change  occurs within two years  following the Potential  Change in Control
and  either  (A)  is  made  at  the  request  or  direction  of or  pursuant  to
 
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negotiations  with a Person who has entered into an  agreement  with the Company
the  consummation  of which  will  constitute  a Change  in  Control;  or (B) is
otherwise  made in  connection  with or in  anticipation  of a Change in Control
which actually occurs.
 
                  (k) "Disability" shall mean the Executive's inability,  due to
physical  or  mental  incapacity,   to  substantially  perform  his  duties  and
responsibilities  under this Agreement for a period of 180  consecutive  days as
determined  by an  approved  medical  doctor,  selected by the  Parties.  If the
Parties  cannot  agree on a medical  doctor,  each Party shall  select a medical
doctor  and the two  doctors  shall  select a third  who  shall be the  approved
medical doctor for this purpose.
 
                  (l) "Effective Date" shall mean August 28, 2002.
 
                  (m) "Long-Term Incentive Plan" shall mean any of the long-term
incentive plans referred to in Section 6(d).
 
                  (n)   "Person"   shall  mean  any   individual,   corporation,
partnership,  limited liability company,  joint venture,  trust, estate,  board,
committee, agency, body, employee benefit plan, or other person or entity.
 
                  (o) "Potential Change in Control" shall mean the occurrence of
any of the following events:
 
                           (i)  the  Company  enters  into  an  agreement,   the
                  consummation  of which  will  result  in the  occurrence  of a
                  Change in Control;
 
                           (ii) the Company or any Person publicly  announces an
                  intention  to take or to consider  taking  actions  which,  if
                  consummated, will constitute a Change in Control; or
 
                           (iii) the Board  adopts a  resolution  to the  effect
                  that, for purposes of this  Agreement,  a Potential  Change in
                  Control has occurred.
 
                  (p)  "Proceeding"  shall mean any threatened or actual action,
suit or proceeding,  whether  civil,  criminal,  administrative,  investigative,
appellate or other.
 
                  (q) "Pro-Rata"  shall mean a fraction,  the numerator of which
is the  number  of days  that  the  Executive  was  employed  in the  applicable
performance  period  (a  fiscal  year  in the  case  of an  annual  bonus  and a
performance  cycle in the case of an award under the Long-Term  Incentive  Plan)
and the  denominator  of which  shall be the  number  of days in the  applicable
performance period.
 
                  (r) "Sign-On Deferrable Restricted Stock Award" shall mean the
restricted stock award referred to in Section 6(b).
 
                  (s)  "Sign-On  Stock  Option"  shall  mean  the  stock  option
referred to in Section 6(a).
 
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                  (t) "Term of  Employment"  shall mean the period  specified in
Section 2.
 
                  (u)  "Termination  Date"  shall  mean the  date on  which  the
Executive's  employment with the Company  terminates in accordance with this (or
any subsequent) Agreement.
 
                  (v) "Voting Stock" shall mean issued and  outstanding  capital
stock or other  securities of any class or classes  having general voting power,
under ordinary  circumstances in the absence of contingencies,  to elect, in the
case of a corporation, the directors of such corporation and, in the case of any
other entity, the corresponding governing Person(s).
 
         2. Term of Employment.  The Company hereby employs the Executive  under
this Agreement,  and the Executive hereby accepts such employment,  for the Term
of  Employment.  The Term of Employment  shall commence as of the Effective Date
and shall end on August 27, 2005; provided, however, that the Term of Employment
shall  thereafter be  automatically  extended for  additional  one-year  periods
("extension periods") unless either Party shall give the other written notice at
least sixty (60) days prior to the  expiration  of the Initial Term or extension
period.  Termination of Executive's employment as a result of non-renewal by the
Company shall be treated as a termination  subject to the  provisions of Section
8(d)  (Termination  without Cause) of this  Agreement.  Notice of non-renewal by
Executive shall be treated as a termination subject to the provisions of Section
8(g) (Voluntary  Termination) of this Agreement.  Notwithstanding the foregoing,
the Term of Employment  may be terminated at any time prior to the expiration of
the Initial Term and/or any extension  period in accordance  with the provisions
of Section 8.
 
         3. Positions, Duties and Responsibilities.
 
                  (a) During the Term of Employment,  the Executive  shall serve
as the President and Chief Executive Officer of the Company and shall be elected
to serve as a member of the Board on the Effective Date or as soon thereafter as
possible,  consistent with the Company's  Articles of Incorporation  and Code of
Regulations;  shall have the authority, duties and responsibilities  customarily
exercised by an individual  serving in those  positions in a corporation  of the
size and nature of the  Company;  shall  perform  such  duties  relating  to the
management and operations of the Company,  consistent with the foregoing, as may
from time to time be assigned  to him by the Board;  shall be assigned no duties
or  responsibilities  that are materially  inconsistent with, or that materially
impair his ability to discharge, the foregoing duties and responsibilities;  and
shall  report  solely and directly to the Board.  In addition,  on or before the
date of the Company's  first annual  shareholders  meeting  occurring  after the
Effective Date, the Executive shall be elected Chairman of the Board.
 
                  (b) Anything herein to the contrary  notwithstanding,  nothing
shall preclude the Executive  from (i) serving,  with prior notice to the Board,
on the boards of directors of a reasonable  number of other  corporations or the
boards  of  a  reasonable  number  of  trade   associations   and/or  charitable
organizations, (ii) engaging in charitable activities and community affairs, and
(iii)  managing  his  personal  investments  and  affairs;  provided  that  such
activities do not materially  interfere with the  performance of the Executive's
duties and responsibilities hereunder.
 
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         4. Base Salary.  Commencing  as of the  Effective  Date,  the Executive
shall be paid an annualized Base Salary of $725,000,  payable in accordance with
the regular payroll practices of the Company.  The Base Salary shall be reviewed
no less frequently than annually for increase in the discretion of the Board.
 
         5. Annual  Incentive  Awards.  The  Executive  shall be eligible for an
annual  incentive  bonus award  opportunity  from the Company in respect of each
fiscal year of the Company that ends during the Term of  Employment.  His annual
target award opportunity shall be no less than 75% of his annualized Base Salary
in  effect  on the  start  of the  fiscal  year  and his  maximum  annual  award
opportunity  shall be no less than 150% of his annualized  Base Salary in effect
on the start of the  fiscal  year;  provided  that for  fiscal  year 2002 of the
Company,  the Executive  shall receive an annual  incentive award of $407,812.50
(calculated  as 75% of his annual  target award  opportunity,  which  payment is
being made in  recognition  of the fact that  Executive  is  forfeiting  certain
compensation from his current employer) and for fiscal year 2003 of the Company,
the Executive  shall receive no less than the target award  opportunity for such
year. The Executive shall be paid his annual  incentive  awards at the same time
that other senior-level executives receive their incentive awards; provided that
the  Executive  has  not  terminated  his  employment  for  reasons  other  than
Constructive  Termination  Without Cause,  or the Company has not terminated the
Executive for Cause, prior to the dates on which such bonuses are paid.
 
         6. Sign-On and Buy-Out Awards; Long-Term Incentive Awards.
 
                  (a) Sign-On Stock Option Award.  As of the Effective Date, the
Company shall grant the Executive a ten-year  option to purchase  300,000 shares
of Common Stock.  Such option shall vest in two equal  installments on the third
and  the  fifth  anniversaries  of the  Effective  Date  subject  to the  terms,
conditions and adjustments set forth in the award  agreement  memorializing  the
award and in Section 8 below.
 
                  (b)  Sign-On  Deferrable  Restricted  Stock  Award.  As of the
Effective  Date, the Company shall grant the Executive a restricted  stock award
for 290,000  shares of Common Stock,  with such shares being held by the Company
until the later of (i) the date the shares vest or (ii) the date such shares are
to be delivered to the Executive  pursuant to his election,  as described below.
Subject  to the  terms,  conditions  and  adjustments  set  forth  in the  award
agreement  memorializing the award and in Section 8 below, the restricted Common
Stock shall vest in three installments as follows:  (x) 125,000 shares will vest
on the third  anniversary  date of the Effective  Date,  (y) 125,000 shares will
vest on the fifth  anniversary of the Effective Date, and (z) 40,000 shares will
vest on the  Executive's  65th  birthday.  The  Executive may elect prior to the
calendar  year in which the  shares  described  above  vest to defer  receipt of
shares,  to the  extent  permitted  by law,  until the  earlier of (xx) the date
specified in such  election or (yy) January of the calendar  year  following his
termination of employment.  Notwithstanding any deferral election, dividends (if
any) will begin to accrue and be paid with respect to shares only after the date
on which such shares become vested.
 
                  (c) Cash Payment. In recognition of the fact that Executive is
forfeiting  certain cash  compensation  from his current  employer,  on or about
January  15,  2003,  the  Company  shall  make a lump  sum cash  payment  to the
Executive  in the  amount  of  $850,000;  provided  that the  Executive  has not
terminated  his  employment  for  reasons  other than
 
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Constructive  Termination  Without Cause,  or the Company has not terminated the
Executive for Cause, prior to such date.
 
                  (d)  Long-Term  Incentive  Plans.  Subject to the terms of the
Company's Long-Term Performance Plan:
 
                           (i) The Executive shall be entitled to participate in
                  the  Company's  Long-Term  Performance  Plan  (applying to the
                  performance  periods of October 1, 2000 through  September 30,
                  2003 and  October 1, 2001  through  September  30,  2004) on a
                  Pro-Rata basis  calculated  based on a cash/stock award target
                  opportunity  of 90% of his  annualized  Base  Salary as of the
                  Effective Date and a maximum award  opportunity of 180% of his
                  annualized  Base Salary as of the Effective Date. As set forth
                  above,  the  prorated  target  incentive  unit  amount for the
                  October  1, 2000  through  September  30,  2003  award will be
                  217,500, and the prorated target incentive unit amount for the
                  October  1, 2001  through  September  30,  2004  award will be
                  435,000.
 
                           (ii) For each performance period commencing under the
                  Company's Long-Term Performance Plan on or after the Effective
                  Date,  the Executive  shall be entitled to participate in such
                  Plan (or any successor plan thereto) on the same basis as, and
                  upon the terms and  conditions  applicable  to,  other  senior
                  executives of the Company, consistent with the Executive's pay
                  and position.
 
                           (iii)  The  Executive  shall be paid any  amount  due
                  under the Long-Term  Performance Plan on the date that payouts
                  are made under  such Plan to other  senior  executives  of the
                  Company.
 
                  (e) On-Going Equity Incentives. During the Term of Employment,
the  Executive  shall be  entitled to  participate  in the  Company's  Long-Term
Incentive  Compensation  Plan (or any successor  plan thereto) on the same basis
as, and upon the terms and conditions  applicable to, other senior executives of
the Company, consistent with the Executive's pay and position.
 
         7. Other Benefits.
 
                  (a)  Executive   Compensation   Plans.   During  the  Term  of
Employment,  the Executive shall be entitled to participate in all  compensation
plans and programs  that are,  from time to time,  made  generally  available to
senior executives of the Company,  including,  without limitation, the Executive
Deferred Compensation Plan.
 
                  (b)  Employee  Benefits.  During the Term of  Employment,  the
Executive  shall  participate  in all employee  benefit  plans and programs made
available  generally to the  Company's  senior  executives,  including,  without
limitation,  pension,  savings and other retirement plans or programs,  medical,
dental, hospitalization,  short-term and long-term disability and life insurance
plans  or  programs,  accidental  death  and  dismemberment  protection,  travel
accident  insurance,  and any other employee welfare or retirement benefit plans
or programs  that may be sponsored  by the Company from time to time,  including
any  plans  or  programs  that  supplement  the  above-listed  types of plans or
programs,  whether  funded or
 
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unfunded. The Executive shall be entitled to post-retirement welfare benefits on
the same basis as other similarly situated senior executives of the Company.
 
                  (c) Supplemental  Pension.  The Executive shall participate in
the  Company's  pension  plan,   supplemental  retirement  plan  and  all  other
retirement plans for senior executives, except that, for purposes of determining
the   Executive's   benefit  under  the   supplemental   retirement   plan  (the
"Supplemental  Pension"),  the  Executive  shall be  credited  with two years of
service for each full year of the  Executive's  actual service with the Company,
with a maximum  Supplemental  Pension of 35% of final average  compensation  (as
defined under the  supplemental  retirement  plan  document).  The  Supplemental
Pension shall be offset by other qualified and non-qualified pension benefits of
the Company.
 
                  (d) Expenses.  The Executive is authorized to incur reasonable
expenses  in  carrying  out his duties and  responsibilities  hereunder  and the
Company  shall  promptly  reimburse  him  for  all  such  expenses,  subject  to
documentation in accordance with reasonable policies of the Company. The Company
shall  promptly  reimburse the Executive for all  reasonable  professional  fees
(including,  without  limitation,  attorneys' fees and other charges of counsel)
incurred by him in connection with the negotiation  and  documentation  of these
employment  arrangements,  up to a maximum of $10,000,  grossed up for taxes. In
the event of any dispute  between the Company and the Executive  during or after
termination  of the  Executive's  employment,  the  Company  will pay all of the
Executive's reasonable  professional fees, costs and expenses of such dispute if
the Executive  prevails.  The Executive  shall be entitled to  reimbursement  of
expenses,  and other benefits  (including tax gross-up),  in connection with his
relocation to the Malvern,  Pennsylvania  area, to the maximum extent consistent
with the Company's relocation programs and policies,  including temporary living
and travel  expenses  for the  Executive  and his family  between the  Company's
offices  and his  current  residence  for one (1) year and the  purchase  of the
Executive's  current  residence  at the  appraised  value at any time during the
2-year period commencing on the Effective Date.
 
                  (e) Benefits and  Perquisites.  During the Term of Employment,
the Executive  shall  participate in all benefits and  perquisites  available to
senior executives or other employees of the Company at the most favorable levels
and terms and conditions for each such benefit and perquisite.
 
                  (f) Vacation.  The  Executive  shall be entitled to four weeks
paid vacation per year.
 
         8. Termination of Employment.
 
                  (a)   Termination   Due  to  Death.  In  the  event  that  the
Executive's  employment  hereunder is terminated due to his death, his estate or
his beneficiaries (as the case may be) shall be entitled to:
 
                           (i) Base Salary through the end of the month in which
                  his death occurs;
 
                           (ii) a Pro-Rata annual incentive award for the fiscal
                  year in which  his death  occurs,  based on the  target  bonus
                  opportunity  for the  year of  death,  payable  in a
 
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                  lump sum  promptly  following  his  death,  regardless  of the
                  Executive's and Company's performance during such fiscal year;
 
                           (iii)   the   continued   right  to   exercise   each
                  outstanding  stock  option  for the lesser of (A) 12 months or
                  (B) the  remainder of the original  term,  all such options to
                  become fully exercisable as of the date of his death;
 
                           (iv)  any   outstanding   shares   from  his  Sign-On
                  Deferrable  Restricted  Stock  Award and all other  restricted
                  stock awards shall vest as of the date of his death; provided,
                  however,  that,  notwithstanding  the  foregoing,  unless  the
                  40,000  shares from his Sign-On  Deferrable  Restricted  Stock
                  Award  which are  scheduled  to vest on the  Executive's  65th
                  birthday have otherwise vested, those shares will be forfeited
                  as of the date of his death;
 
                           (v)  immediate  vesting in the  Company's  Retirement
                  Savings Plan (or any  successor  401(k)  plan),  pension plan,
                  supplemental   retirement  plan  (including  the  Supplemental
                  Pension  )  and  deferred  compensation  plans,  or  the  cash
                  equivalent thereof;
 
                           (vi)  Pro-Rata  Long-Term   Incentive  Plan  payouts,
                  payable in a lump sum, if earned,  promptly  following the end
                  of the performance periods; and
 
                           (vii) the benefits described in Section 8(h)(i).
 
                  (b)  Termination  Due to  Disability.  In the  event  that the
Executive's  employment  hereunder is terminated due to Disability,  he shall be
entitled to the following:
 
                           (i) Periodic  disability  payments in accordance with
                  the Company's  Long-Term  Disability  Plan  (provided that the
                  Executive  is and  continues  to be disabled as defined  under
                  that plan);
 
                           (ii)  Base  Salary  through  the end of the  month in
                  which the Termination Date occurs;
 
                           (iii)  a  Pro-Rata  annual  incentive  award  for the
                  fiscal year in which his employment  terminates,  based on his
                  target bonus opportunity for the year of termination,  payable
                  in  a  lump  sum  promptly  following  the  Termination  Date,
                  regardless of the Executive's and Company's performance during
                  such fiscal year;
 
                           (iv) the continued right to exercise each outstanding
                  stock  option  for  the  lesser  of (A) 12  months  or (B) the
                  remainder  of the  original  term,  all such options to become
                  fully exercisable as of the Termination Date;
 
                           (v)  any   outstanding   shares   from  his   Sign-On
                  Deferrable  Restricted  Stock  Award and any other  restricted
                  stock awards shall vest as of the Termination Date;  provided,
                  however, that notwithstanding anything in the foregoing to the
                  contrary, unless the 40,000 shares from his Sign-On Deferrable
                  Restricted  Stock  Award  which are  scheduled  to vest on the
                  Executive's  65th birthday have otherwise  vest,  those shares
                  will be forfeited as of the Termination Date;
 
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                           (vi)  Pro-Rata  Long-Term   Incentive  Plan  payouts,
                  payable in a lump sum, if earned,  promptly  following the end
                  of the performance periods;
 
                           (vii)  continued  participation,  for a period of two
                  years  from the  Termination  Date,  in all  medical,  dental,
                  vision,   hospitalization,   disability   and  life  insurance
                  coverages and in all other  employee  welfare  benefit  plans,
                  programs and arrangements in which he was participating on the
                  date  on  which  his  employment  terminates,   on  terms  and
                  conditions  that are no less  favorable to him than those that
                  applied  on such  date,  and with  COBRA  benefits  commencing
                  thereafter;  provided that the Company's obligation under this
                  Section 8(b)(v) shall be reduced to the extent that equivalent
                  coverages and benefits  (determined on a  coverage-by-coverage
                  and  benefit-by-benefit  basis) are provided  under the plans,
                  programs or arrangements of a subsequent employer;
 
                           (viii) immediate vesting in the Company's  Retirement
                  Savings Plan (or any  successor  401(k)  plan),  pension plan,
                  supplemental   retirement  plan  (including  the  Supplemental
                  Pension)  and  deferred   compensation   plans,  or  the  cash
                  equivalent thereof; and
 
                           (ix) the benefits described in Section 8(h)(i).
 
No termination of the Executive's  employment for Disability  shall be effective
until the Company first gives 15 days written notice of such  termination to the
Executive.
 
                  (c) Termination by the Company for Cause.
 
                           (i)  No  termination  of the  Executive's  employment
                  hereunder by the Company for Cause shall be  effective  unless
                  the  provisions  of  this  Section  8(c)(i)  shall  have  been
                  complied with. The Executive  shall be given written notice by
                  the Board of the  intention to terminate  him for Cause,  such
                  notice to state in detail the  particular  circumstances  that
                  constitute the grounds on which the proposed  termination  for
                  Cause  is  based.  The  Executive  shall  have 15  days  after
                  receiving  such notice in which to cure such  grounds,  to the
                  extent  such  cure is  possible.  If he  fails  to  cure  such
                  grounds,  the  Executive  shall then be  entitled to a hearing
                  before the Board. Such hearing shall be held within 20 days of
                  his  receiving  such notice,  provided  that he requests  such
                  hearing  within 15 days of receiving  such notice.  If, within
                  five days  following  such  hearing,  the Board gives  written
                  notice to the Executive confirming that, in the judgment of at
                  least  two-thirds  of the  members  of the  Board,  Cause  for
                  terminating  his  employment  on the  basis  set  forth in the
                  original  notice  exists,   his  employment   hereunder  shall
                  thereupon be terminated for Cause,  subject to de novo review,
                  at the Executive's election, through arbitration in accordance
                  with Section 14.
 
                           (ii) In the  event  that the  Executive's  employment
                  hereunder is terminated by the Company for Cause in accordance
                  with Section 8(c)(i), he shall be entitled to:
 
                                    (A) the  lesser  of (I) 30 days or (II)  the
                           remainder of the original  term to exercise any stock
                           option  that  is  vested  and   exercisable   on  the
 
                                       10
 
<PAGE>
 
                           Termination  Date.  All stock  options  which are not
                           vested and  exercisable  as of the  Termination  Date
                           will be forfeited,  and all unvested restricted stock
                           which is outstanding as of the Termination Date, will
                           be forfeited; and
 
                                    (B)  the   benefits   described  in  Section
                           8(h)(i).
 
                  (d)   Termination   Without  Cause.  In  the  event  that  the
Executive's  employment hereunder is terminated by the Company without Cause and
Sections 8(a) (death),  8(b)  (Disability) and 8(f) (Change in Control) does not
apply, and provided  Executive has executed a full release  substantially in the
form attached hereto as Exhibit A, then the Executive shall be entitled to:
 
                           (i) Base Salary through the second anniversary of the
                  Termination Date, payable as provided in Section 4;
 
                           (ii) a Pro-Rata annual incentive award for the fiscal
                  year in which his employment  terminates,  based on his target
                  bonus  opportunity for the year of  termination,  payable in a
                  lump sum promptly  following the Termination Date,  regardless
                  of the  Executive's  and  Company's  performance  during  such
                  fiscal year;
 
                           (iii) an  annual  incentive  award for a period of 24
                  months  following the  Termination  Date,  based on the target
                  bonus  opportunity for the year of  termination,  payable on a
                  Pro-Rata basis in equal  installments over the 24-month period
                  for which Base Salary is continued;
 
                           (iv) the continued  right to exercise any outstanding
                  stock option for the lesser of (A) 1 year or (B) the remainder
                  of the  original  term,  all  such  options  to  become  fully
                  exercisable as of the Termination Date;
 
                           (v)  any   outstanding   shares   from  his   Sign-On
                  Deferrable  Restricted  Stock  Award and any other  restricted
                  stock awards shall vest as of the Termination Date;  provided,
                  however, that notwithstanding anything in the foregoing to the
                  contrary, unless the 40,000 shares from his Sign-On Deferrable
                  Restricted  Stock  Award  which are  scheduled  to vest on the
                  Executive's 65th birthday have otherwise vested,  those shares
                  will be forfeited as of the Termination Date;
 
                           (vi) full payout,  at target award  levels,  for each
                  outstanding  performance  cycle  period  under  the  Long-Term
                  Performance Plan in which the Executive is participating as of
                  the  Termination  Date,  with  the  payouts  due in a lump sum
                  promptly following the Termination Date;
 
                           (vii)  continued  participation,  through  the second
                  anniversary of the Termination  Date, in all medical,  dental,
                  vision,   hospitalization,   disability   and  life  insurance
                  coverages and in all other  employee  welfare  benefit  plans,
                  programs and  arrangements  in which he or his family  members
                  were  participating on such date, on terms and conditions that
                  are no less  favorable  to him than those that applied on such
                  date and with COBRA benefits commencing  thereafter;  provided
                  that the  Company's  obligation  under this  Section  8(d)(vi)
                  shall be reduced to the extent that  equivalent
 
                                       11
<PAGE>
 
                  coverages and benefits  (determined on a  coverage-by-coverage
                  and  benefit-by-benefit  basis) are provided  under the plans,
                  programs or arrangements of a subsequent employer; and
 
                           (viii) immediate vesting in the Company's  Retirement
                  Savings Plan (or any  successor  401(k)  plan),  pension plan,
                  supplemental   retirement  plan  (including  the  Supplemental
                  Pension)  and  deferred   compensation   plans,  or  the  cash
                  equivalent thereof; and
 
                           (ix) the benefits described in Section 8(h)(i).
 
         The  Executive  will not receive any  additional  severance or payments
other than that provided  under this Section 8(d) for any term  remaining  under
the employment agreement.
 
                  (e) Constructive  Termination Without Cause. In the event that
(x) a Constructive Termination Without Cause occurs and (y) Section 8(f) (Change
in Control) does not apply,  then the Executive shall have the same entitlements
as provided under Section 8(d) for a termination  by the Company  without Cause,
subject to Executive's executing a full release satisfactory to the Company.
 
                  (f) Termination Without Cause Following a Change in Control or
Potential  Change in Control.  In the event that (x) the Executive's  employment
hereunder is terminated (A) through a Constructive  Termination Without Cause or
(B) by the Company without Cause and (y) the termination of employment occurs in
connection  with,  or within  two years  following,  a Change  in  Control,  and
provided that  Executive has executed a full release  substantially  in the form
attached hereto as Exhibit A, then the Executive shall be entitled to:
 
                           (i) Base Salary through the third  anniversary of the
                  Termination Date, payable as provided in Section 4;
 
                           (ii) a Pro-Rata annual incentive award for the fiscal
                  year in which his  employment  terminates  based on the target
                  bonus  opportunity for the year of  termination,  payable in a
                  lump sum promptly  following the Termination Date,  regardless
                  of the  Executive's  and  Company's  performance  during  such
                  fiscal year;
 
                           (iii) an  annual  incentive  award for a period of 36
                  months following the Termination Date, based on the greater of
                  (A) his maximum  incentive  bonus for the year of  termination
                  and (B) his actual bonus for the year  preceding  termination,
                  payable in equal  installments  over the  36-month  period for
                  which Base Salary is continued.
 
                           (iv)  the  continued  right  to  exercise  any  stock
                  option,  for the lesser of (A) 24 months and (B) the remainder
                  of its  original  term,  all  such  options  to  become  fully
                  exercisable as of the Termination Date;
 
                           (v) all  restricted  stock  awards  shall vest on the
                  Termination Date (including the 40,000  restricted shares from
                  the  Sign-On  Deferrable  Restricted  Share  Award  which  are
                  scheduled to vest on the Executive's 65th birthday);
 
                                       12
 
<PAGE>
 
                           (vi)  full  payout,  at  target  levels,  under  each
                  ongoing  Long-Term  Performance Plan in which the Executive is
                  participating as of the Termination Date, with the payouts due
                  in a lump sum promptly following the Termination Date;
 
                           (vii) an amount equal to the Company's  contributions
                  to which the  Executive  would  have been  entitled  under the
                  Company's  Retirement  Savings Plan (or any successor thereto)
                  if the Executive had continued working for the Company and the
                  Retirement  Savings  Plan  continued  in force  for 36  months
                  following the  Termination  Date at the highest annual rate of
                  Base Salary achieved  during the Executive's  period of actual
                  employment with the Company,  and making the maximum amount of
                  employee  contributions,  if any, as are  required  under such
                  plan;
 
                           (viii)  an  amount  equal  to the  excess  of (A) the
                  present value of the benefits to which the Executive  would be
                  entitled  under  the  Company's  pension  plan  and  Company's
                  supplemental   retirement  plan  (including  the  Supplemental
                  Pension ) (and any  successor  thereto) if the  Executive  had
                  continued  working  for the  Company for a period of 36 months
                  following the  Termination  Date at the highest annual rate of
                  Base Salary achieved  during the Executive's  period of actual
                  employment with the Company, and the pension plan continued in
                  force during the 36 months  following  the  Termination  Date,
                  over (B) the  present  value  of the  benefits  to  which  the
                  Executive is actually  entitled  under the  Company's  pension
                  plan  and   supplemental   retirement   plan   (including  the
                  Supplemental  Pension),  each  computed  as of the date of the
                  Termination  Date, with present values to be determined  using
                  the  discount  rate  used  by the  Pension  Benefits  Guaranty
                  Corporation  to calculate  the benefit  liabilities  under the
                  pension  plan  in  the  event  of a  plan  termination  on the
                  Termination  Date,  compounded  monthly,  the mortality tables
                  prescribed  in the  Company's  Pension  Plan  for  determining
                  actuarial  equivalence,  and the reduction factor (if any) for
                  the  early  commencement  of  pension  payments  based  on the
                  Executive's  age on the last day of the 36th  month  following
                  the Termination Date;
 
                           (ix)  immediate  vesting in the Company's  Retirement
                  Savings Plan (or any  successor  401(k)  plan),  pension plan,
                  supplemental   retirement  plan  (including  the  Supplemental
                  Pension)  and  deferred   compensation   plans,  or  the  cash
                  equivalent thereof;
 
                           (x)  continued   participation,   through  the  third
                  anniversary of the Termination  Date, in all medical,  dental,
                  vision,   hospitalization,   disability   and  life  insurance
                  coverages and in all other  employee  welfare  benefit  plans,
                  programs and  arrangements  in which he or his family  members
                  were  participating on such date, on terms and conditions that
                  are no less  favorable  to him than those that applied on such
                  date and with COBRA benefits commencing  thereafter,  provided
                  that the Company's obligation under this Section 8(f)(x) shall
                  be  reduced  to  the  extent  that  equivalent  coverages  and
                  benefits   (determined   on   a    coverage-by-coverage    and
                  benefit-by-benefit   basis)  are  provided  under  the  plans,
                  programs or arrangements of a subsequent employer; and
 
                           (xi) the benefits described in Section 8(h)(i).
 
                                       13
 
<PAGE>
 
 
                  For purposes of this Section  8(f), if preceded by a Potential
Change in Control,  any of the following events (if such event occurs within two
years  following  such  Potential  Change  in  Control)  shall be deemed to be a
Termination  of  Executive's  Employment  without  Cause  following  a Change in
Control:  1) the  Executive's  employment is  terminated  without Cause and such
termination is at the request or direction of or pursuant to negotiations with a
Person who has entered into an agreement  with the Company the  consummation  of
which will  constitute a Change in Control;  2) the  Executive's  employment  is
terminated   through  a   Constructive   Termination   Without   Cause  and  the
circumstances  or events which  constitute  the basis for  Executive's  claim of
Constructive  Termination  occur at the request or direction  of, or pursuant to
negotiations  with, such Person, or 3) the Executive's  employment is terminated
without  Cause  and such  termination  is  otherwise  in  connection  with or in
anticipation of a Change in Control which actually occurs.
 
                  (g)  Voluntary  Termination.  In the event that the  Executive
terminates his employment with the Company on his own initiative,  other than by
death, for Disability,  or by a Constructive  Termination Without Cause, then he
shall have the same  entitlements as provided in Section 8(c)(ii) in the case of
a  termination  by the Company for Cause.  A  voluntary  termination  under this
Section 8(g) shall be effective upon written notice to the Company and shall not
be deemed a breach of this Agreement.
 
                  (h) Miscellaneous.
 
                           (i) On any termination of the Executive's  employment
                  hereunder, he shall be entitled to:
 
                                    (A)  Base  Salary  through  the  Termination
                           Date;
 
                                    (B) any amounts due him under Section 7;
 
                                    (C) a lump-sum payment in respect of accrued
                           but unused  vacation  days at his Base Salary rate in
                           effect as of the Termination Date;
 
                                    (D)  payment,  promptly  when  due,  of  all
                           amounts   owed  to  him  in   connection   with   the
                           termination; and
 
                                    (E) other  benefits,  if any, in  accordance
                           with applicable  plans,  programs and arrangements of
                           the Company. This provision will permit the Executive
                           to elect to take  advantage of any  provisions of, or
                           changes  to,  the  IKON   benefit   plans  which  are
                           applicable to IKON  employees  generally  (including,
                           without   limitation,   provisions  relating  to  the
                           vesting/exercisability  of stock options in the event
                           of retirement or disability), provided that Executive
                           opts to  have  such  general  provisions  applied  on
                           his/her  behalf  instead  of those  set forth in this
                           Agreement.  In no event, however, will this provision
                           entitle  Executive to duplicative or double benefits,
                           nor shall he be  eligible to receive  payments  under
                           any  severance  program of the Company  applicable to
                           employees generally.
 
                           (ii) In the event that the  Executive,  or any member
                  of his family, is precluded from continuing full participation
                  in any employee benefit plan, program or
 
                                       14
 
<PAGE>
 
                  arrangement,  then the  Executive  shall be provided  with the
                  after-tax  economic  equivalent  of any  benefit  or  coverage
                  foregone.  For this  purpose,  the economic  equivalent of any
                  benefit or coverage  foregone  shall be deemed to be the total
                  cost to the  Executive of  obtaining  such benefit or coverage
                  himself on an  individual  basis.  Payment  of such  after-tax
                  economic  equivalent  shall  be  made  quarterly  in  advance,
                  without discount.
 
                           (iii)  In  the  event  of  any   termination  of  the
                  Executive's employment hereunder, the Executive shall be under
                  no obligation to seek other  employment or otherwise  mitigate
                  the obligations of the Company under this Agreement.
 
                           (iv)  Any  amounts  due  under  this  Section  8  are
                  considered  to be reasonable by the Company and are not in the
                  nature of a penalty.
 
         9. Change in Control.
 
                  (a)  Vesting.  In the event  that a Change in  Control  occurs
after the Effective Date, then each outstanding  stock option shall become fully
exercisable  as of the date of such  Change  in  Control  and  each  outstanding
restricted  stock award shall  likewise  become fully vested.  In addition,  the
Executive's full age 65 Supplemental  Pension benefit shall be fully accrued and
vested.  The Executive shall receive all Change in Control benefits  provided to
senior  executives  under  the  Company's   compensation   plans  or  individual
agreements  to the extent that the  benefits,  terms and  conditions  under such
plans  or  agreements  are  more  favorable  to  the  Executive  than,  and  not
duplicative of, the benefits  provided under this  Agreement.  In the event that
holders of Common Stock receive cash, securities or other property in respect to
their  Common  Stock in  connection  with a Change in Control  transaction,  the
Company shall use its best reasonable  efforts to enable the Executive (if he so
elects)  to  exercise  any stock  option  at a time and in a  fashion  that will
entitle  him to  receive  in  exchange  for any shares  thus  acquired  the same
consideration  as is  received in such  Change in Control  transaction  by other
holders of Common Stock.
 
                  (b) Golden  Parachute  Tax.  In the event that any  payment or
benefit made or provided to or for the benefit of the  Executive  in  connection
with  this  Agreement,  the  Executive's  employment  with the  Company,  or the
termination  thereof (a "Payment") is determined to be subject to any excise tax
("Excise  Tax")  imposed by Section  4999 of the Code (or any  successor to such
Section),  the Company shall pay to the Executive,  prior to the time any Excise
Tax is payable with respect to such Payment (through  withholding or otherwise),
an additional  amount  which,  after the  imposition of all income,  employment,
excise and other taxes,  penalties and interest thereon,  is equal to the sum of
(i)  the  Excise  Tax on  such  Payment  plus  (ii)  any  penalty  and  interest
assessments  associated with such Excise Tax. The  determination  of whether any
Payment is  subject  to an Excise  Tax and,  if so, the amount to be paid by the
Company to the Executive and the time of payment shall be made by an independent
auditor (the "Auditor") selected jointly by the Parties and paid by the Company.
Unless the  Executive  agrees  otherwise  in  writing,  the  Auditor  shall be a
nationally  recognized United States public accounting firm that has not, during
the two years preceding the date of its selection, acted in any way on behalf of
the Company or any of its Affiliates. If the Parties cannot agree on the firm to
serve as the Auditor, then the Parties shall each select one accounting firm and
those  two  firms  shall  jointly  select  the  accounting  firm to serve as the
Auditor.
 
                                       15
 
<PAGE>
 
         10. Indemnification; D&O Insurance.
 
                  (a)  Indemnification.  The  Company  agrees  that  (i)  if the
Executive  is  made  a  party,  or is  threatened  to be  made a  party,  to any
Proceeding  by  reason  of  the  fact  that  he is or was a  director,  officer,
employee,  agent, manager,  consultant or representative of the Company or is or
was  serving  at the  request  of the  Company  or  any of its  Affiliates  as a
director,   officer,   member,   employee,   agent,   manager,   consultant   or
representative  of another Person or (ii) if any Claim is made, or threatened to
be made,  that  arises out of or relates to this  Agreement  or the  Executive's
service  hereunder or in any of the  foregoing  capacities,  then the  Executive
shall  promptly be  indemnified  and held harmless by the Company for any Claims
brought by a third party  against the  Executive to the fullest  extent  legally
permitted or  authorized  by the Company's  Articles of  Incorporation,  Code of
Regulations or Board  resolutions  or by the laws of the State of Ohio,  against
any  and  all  costs,  expenses,  liabilities  and  losses  (including,  without
limitation,  attorneys' fees,  judgments,  interest,  expenses of investigation,
penalties, fines, ERISA excise taxes or penalties and amounts paid or to be paid
in  settlement)  incurred or suffered by the Executive in connection  therewith,
and such  indemnification  shall  continue  as to the  Executive  even if he has
ceased  to be a  director,  member,  employee,  agent,  manager,  consultant  or
representative  of the Company or other Person and shall inure to the benefit of
the Executive's heirs,  executors and administrators.  The Company shall advance
to the Executive all costs and expenses  incurred by him in connection  with any
such  Proceeding  or  Claim  within  20  days  after  receiving  written  notice
requesting such an advance. Such notice shall include, to the extent required by
applicable  law, an undertaking by the Executive to repay the amount advanced if
he is ultimately  determined not to be entitled to indemnification  against such
costs and expenses.
 
                  (b) D&O  Insurance.  During the Term of  Employment  and for a
period of six years thereafter, the Company shall keep in place a directors' and
officers'  liability  insurance  policy (or  policies)  providing  comprehensive
coverage to the Executive to the extent that the Company  provides such coverage
for any other senior executive or director.
 
         11. Covenants.
 
                  (a)  Confidentiality.   During  the  Term  of  Employment  and
thereafter,  the Executive  shall not,  without the prior written consent of the
Company,  divulge,  disclose or make  accessible to any Person any  confidential
non-public document, record or information concerning the business or affairs of
the  Company  that he has  acquired in the course of his  employment  hereunder,
except (x) to the Company or to any authorized (or apparently  authorized) agent
or representative of the Company,  (y) to authorized third parties in connection
with performing his duties under this  Agreement,  or (z) when required to do so
by law or by a court,  governmental  agency,  legislative  body, or other Person
with apparent jurisdiction to order him to divulge,  disclose or make accessible
such  information;  provided  that  these  restrictions  shall  not apply to any
document,  record or other information that (i) has previously been disclosed to
the  public,  or is in  the  public  domain,  other  than  as a  result  of  the
Executive's  breach  of  this  Section  11(a),  or (ii) is  known  or  generally
available within any trade or industry of the Company.
 
                                       16
 
<PAGE>
 
                  (b)   Non-Solicitation.   During  the  24-month   period  that
commences  on the  Termination  Date and ends on the second  anniversary  of the
Termination  Date,  the  Executive  shall not without  the prior  consent of the
Company:
 
                           (i)  solicit,  on his own  behalf or on behalf of any
                  other Person,  any individual  known by the Executive to be an
                  employee of the  Company to instead  become an employee of any
                  Person not affiliated with the Company; or
 
                           (ii)  solicit,  on his own behalf or on behalf of any
                  other Person, any Person known by the Executive to be customer
                  of, or vendor  to, the  Company  to cease to be a customer  or
                  vendor  of the  Company  and/or to  become a  customer  of, or
                  vendor to, any Person not affiliated with the Company.
 
                  (c) Non-Competition. During the 24-month period that commences
on the  Termination  Date and ends on the first  anniversary of the  Termination
Date,  the  Executive  shall not,  without  the prior  consent  of the  Company,
directly or indirectly own, manage, operate, join, control or participate in the
ownership,  management,  operation or control of, or be employed by or otherwise
connected  in any  substantial  manner  with  any  business  which  directly  or
indirectly  competes  to a  material  extent  with any line of  business  of the
Company  or  its  subsidiaries   which  was  operated  by  the  Company  or  its
subsidiaries  at the Termination  Date;  provided that nothing in this paragraph
shall prohibit the Executive from acquiring up to 5% of any class of outstanding
equity  securities  of any  corporation  whose equity  securities  are regularly
traded on a national securities exchange or in the "over-the-counter market."
 
                  The foregoing noncompetition restriction of this Section 11(c)
shall not apply following a Change of Control if (v) the Executive's  employment
has been terminated by the Company without Cause within two years following such
Change in Control,  (w) the Executive terminates his employment as the result of
a Constructive  Termination within two years following such Change in Control or
(x) the Company elects,  within two years following such Change in Control,  not
to extend the term of employment.
 
                  The foregoing noncompetition restriction of this Section 11(c)
shall not apply  following a Potential  Change in Control if: 1) the Executive's
employment is terminated without Cause within two years following such Potential
Change in Control,  and such  termination  is at the request or  direction of or
pursuant to  negotiations  with a Person who has entered into an agreement  with
the Company the  consummation of which will  constitute a Change in Control;  2)
the  Executive's  employment  is  terminated  through a  Constructive  Discharge
without Cause within two years following such Potential  Change in Control,  and
the  circumstances or events which constitute the basis for Executive's claim of
Constructive  Discharge  occur at the  request or  direction  of, or pursuant to
negotiations  with,  such  Person,  3) the  Company  elects,  within  two  years
following  such  Potential  Change  in  Control,  not  to  extend  the  term  of
employment,  and such election was at the request or direction of or pursuant to
negotiations  with such Person;  or 4) the Executive's  employment is terminated
without Cause within two years  following such  Potential  Change in Control and
such  termination is otherwise in connection with or in anticipation of a Change
in Control which actually occurs.
 
                                       17
 
<PAGE>
 
         12. Assignability, Binding Nature. This Agreement shall be binding upon
and inure to the benefit of the Parties and their respective  successors,  heirs
(in the case of the  Executive)  and assigns.  No rights or  obligations  of the
Company  under this  Agreement  may be  assigned or  transferred  by the Company
except that such rights or obligations  may be assigned or transferred  pursuant
to a merger or consolidation in which the Company is not the continuing  entity,
or a sale  or  liquidation  of all or  substantially  all of the  assets  of the
Company;  provided  that the assignee or  transferee  is the successor to all or
substantially  all of the assets of the Company and such  assignee or transferee
assumes the liabilities,  obligations and duties of the Company, as contained in
this Agreement,  either contractually or as a matter of law. In the event of any
sale of assets or  liquidation  as  described  in the  preceding  sentence,  the
Company  shall use its best  efforts to cause such  assignee  or  transferee  to
expressly  assume  the  liabilities,  obligations  and  duties  of  the  Company
hereunder  and perform this  Agreement in the same manner and to the same extent
that  the  Company  would  be  required  to  perform  if no such  assignment  or
succession  taken place.  No rights or obligations  of the Executive  under this
Agreement may be assigned or transferred by the Executive  other than his rights
to compensation and benefits, which may be transferred only by will or operation
of law, except as provided in Section 16(e).
 
         13. Representations.
 
                  (a) The Company's Representations.  The Company represents and
warrants  that (i) it is fully  authorized  by action  of its Board  (and of any
other Person or body whose action is required) to enter into this  Agreement and
to  perform  its  obligations  under  it;  (ii)  the  execution,   delivery  and
performance  of this  Agreement by the Company  does not violate any  applicable
law, regulation,  order, judgment or decree or any agreement,  plan or corporate
governance document of the Company; and (iii) upon the execution and delivery of
this  Agreement by the Parties,  this  Agreement  shall be the valid and binding
obligation of the Company,  enforceable  against the Company in accordance  with
its terms,  except to the  extent  enforceability  may be limited by  applicable
bankruptcy,  insolvency or similar laws affecting the  enforcement of creditors'
rights generally.
 
                  (b) The Executive's Representations.  The Executive represents
and warrants  that, to the best of his  knowledge  and belief,  (i) delivery and
performance  of this  Agreement  by him does not  violate  any  applicable  law,
regulation, order, judgment or decree or any agreement to which the Executive is
a party or by which he is bound,  and (ii) upon the  execution  and  delivery of
this  Agreement by the Parties,  this  Agreement  shall be the valid and binding
obligation of the  Executive,  enforceable  against him in  accordance  with its
terms,  except  to the  extent  enforceability  may  be  limited  by  applicable
bankruptcy,  insolvency or similar laws affecting the  enforcement of creditors'
rights generally.
 
         14.  Resolution  of Disputes.  Any Claim  arising out of or relating to
this Agreement or the Executive's employment with the Company or the termination
thereof  shall be resolved by binding  confidential  arbitration,  to be held in
Philadelphia,  Pennsylvania, in accordance with the Commercial Arbitration Rules
of the American Arbitration Association. Judgment upon the award rendered by the
arbitrator(s)  may be  entered in any court  having  jurisdiction  thereof.  The
Company shall promptly pay all costs and expenses, including without limitation,
attorneys' fees, incurred by the Executive or his beneficiaries in resolving any
successful  Claim.  Pending  the  resolution  of any Claim  (and  provided  that
Executive  is not in  breach  of his  post-termination
 
                                       18
<PAGE>
 
obligations under this Agreement),  the Executive (and his beneficiaries)  shall
be advanced any payments  which are allegedly due under the Agreement  (with the
timing  of such  payments  to be made  in  accordance  with  the  terms  of this
Agreement). Any amounts advanced under this Section 14 will be subject to offset
by the Company from any award obtained by the Executive (and/or reimbursement by
the  Executive  to the Company in the event that his award (if any) is less than
the amount advanced).
 
         15.  Notices.   Any  notice,   consent,   demand,   request,  or  other
communication  given to a Person in connection  with this Agreement  shall be in
writing and shall be deemed to have been given to such Person (a) when delivered
personally  to such  Person or (b)  provided  that a written  acknowledgment  of
receipt  is  obtained,  two  days  after  being  sent by  prepaid  certified  or
registered mail, or by a nationally recognized overnight courier, to the address
specified  below for such Person (or to such other  address as such Person shall
have specified by ten days advance notice given in accordance  with this Section
15), or (c) in the case of the Company only, on the first  business day after it
is sent by  facsimile to the  facsimile  number set forth for the Company (or to
such other  facsimile  number as the Company  shall have  specified  by ten days
advance  notice given in accordance  with this Section 15), with a  confirmatory
copy sent by certified or registered mail or by overnight courier to the Company
in accordance with this Section 15.
 
               If to the Company:         IKON Office Solutions, Inc.
                                          70 Valley Stream Parkway
                                          Malvern, Pennsylvania 19355
                                          Attn:  General Counsel
                                          Facsimile #:  610-725-8279
 
               If to the Executive:       Matthew J. Espe
                                          10 Rydalwood Lane
                                          Moreland Hills, OH  44022
                                          (or the most recent address on file
                                          with the Company)
 
                                          (with a copy to the Executive at the
                                          Company's address)
 
               If to a beneficiary        The address most recently specified by
               of the Executive:          the Executive or beneficiary through
                                          notice given in accordance with this
                                          Section 15.
 
 
         16. Miscellaneous.
 
                  (a)  Entire  Agreement.  This  Agreement  contains  the entire
understanding  and agreement  between the Parties  concerning the subject matter
hereof  and  supersedes  all  prior  agreements,  understandings,   discussions,
negotiations  and  undertakings,  whether written or oral,  (including,  without
limitation,  the term sheet dated  August 28,  2002)  between  the Parties  with
respect thereto.
 
                                       19
 
 
<PAGE>
 
 
                  (b)  Severability.  In the event that any provision or portion
of this  Agreement  shall be 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 law so as to achieve the purposes of this Agreement.
 
                  (c) Amendment or Waiver. No provision in this Agreement may be
amended  unless such  amendment is set forth in a writing signed by the Parties.
No waiver by either Party of any breach of any condition or provision  contained
in this  Agreement  shall be  deemed  a  waiver  of any  similar  or  dissimilar
condition  or  provision  at the same or any  prior or  subsequent  time.  To be
effective,  any  waiver  must be set  forth in a writing  signed by the  waiving
Party.
 
                  (d) Headings.  The headings of the Sections  contained in this
Agreement are for convenience  only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.
 
                  (e) Beneficiaries/References. The Executive shall be entitled,
to the  extent  permitted  under any  applicable  law,  to select  and  change a
beneficiary or beneficiaries  to receive any  compensation or benefit  hereunder
following the Executive's death by giving the Company written notice thereof. In
the  event  of  the  Executive's  death  or  a  judicial  determination  of  his
incompetence,  references in this  Agreement to the  Executive  shall be deemed,
where  appropriate,  to  refer  to  his  beneficiary,   estate  or  other  legal
representative.
 
                  (f)  Survivorship.  Except  as  otherwise  set  forth  in this
Agreement,  the respective rights and obligations of the Parties hereunder shall
survive any termination of the Executive's employment.
 
                  (g)  Governing  Law/Jurisdiction.   This  Agreement  shall  be
governed,  construed,  performed and enforced in accordance with the laws of the
State of Pennsylvania, without reference to principles of conflict of laws.
 
                  (h)  Counterparts.  This  Agreement  may be executed in two or
more counterparts.
 
                  (i) Employee Benefit Plans. In the event that the terms of any
of the Company's  employee benefit plans provide for the vesting or distribution
of benefits on a date  earlier than the date set forth in this  Agreement,  such
earlier date shall prevail.
 
                                       20
 
<PAGE>
 
         IN WITNESS WHEREOF,  the undersigned have executed this Agreement as of
the date first set forth above.
 
 
                                              The Company
 
 
                                              By:  /s/ THOMAS GIBSON
                                                   -----------------------------
                                                   Thomas Gibson
                                                   On Behalf of the Board
 
                                              The Executive
 
 
                                              /s/ MATTHEW J. ESPE
                                              ----------------------------------