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                                                                    EXHIBIT 10.9


                              [BANK ONE LETTERHEAD]



AGREEMENT made the 18th day of December 2000.

BETWEEN: BANK ONE, NA (ARBN 064 474 102) of Level 32, 60 Margaret Street, Sydney
NSW (the `Bank')

AND: DAISYTEK AUSTRALIA PTY LTD (ACN 075 675 795) (the `Borrower')

WHEREBY IT IS AGREED as follows:

A.  The Borrower has requested that the Bank provide or continue to provide
    certain financial accommodation to the Borrower.

B.  The Bank desires to provide or to continue to provide such financial
    accommodation to the Borrower upon and subject to the terms and conditions
    of this Agreement.

C.  The obligations of the Borrower under this Agreement (`Guaranteed Amount')
    are unconditionally guaranteed by the DAISYTEK, INC and DAISYTEK
    INTERNATIONAL CORPORATION (the `Guarantor').

1.  INTERPRETATION

    1.1   DEFINITIONS

          In this Agreement unless the context otherwise requires:

          "ACCOMMODATION LIMIT" means $15,000,000 or such other amount
          (Australian Fifteen Million Dollars) which both parties may agree upon
          in writing from time to time.

          "ADVANCE" means any cash advance drawn under this Facility.

          "THIS AGREEMENT" means this Agreement and any other agreement
          expressed to be supplemental to this Agreement to which the parties to
          this Agreement are parties and any amendments to any such document.

          "APPROVED PURPOSES" means the working capital needs, acquisitions and
          other general corporate purposes of the Borrower.

          "AUTHORISED OFFICER" means:

          (a)  in relation to the Borrower, all persons designated by the
               Borrower as an Authorised Officer from time to time, and notified
               in writing by the Borrower to the Bank and;

          (b)  in relation to the Bank, persons designated by the Bank as
               Authorised Officers;

          "BANK" means its successors and permitted assigns.

          "BBSY" means in respect of any day and in respect of any Interest
          Period the rate per centum per annum quoted on the page numbered
          `BBSY' of the Reuters Monitor System under the heading `Average Bid
          Rate' for such Interest Period at or about 10.00am (Sydney time) on
          such day or on the first day if such Interest Period (rounded up if
          necessary, to the nearest four decimal places) PROVIDED THAT if in
          respect of any Interest Period BBSY cannot be determined in accordance
          with the foregoing procedures then BBSY for that Interest Period shall
          mean such rate as is agreed between the Bank and the Borrower having
          regard to comparable indices then available and in the absence of any
          such agreement shall be the rate stipulated by the Bank having regard
          to such comparable indices.

          "BILL" has the same meaning as in the Bills of Exchange Act 1909 (but
          does not include a cheque).


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          "THE BORROWER" includes it successors and permitted assigns.

          "BUSINESS DAY" means a day on which Australian trading banks are open
          for a full range of banking business in the metropolitan area of
          Adelaide, South Australia, Melbourne, Victoria and Sydney, New South
          Wales.

          "DRAWDOWN" means an Advance made by the Bank to the Borrower pursuant
          to this Agreement.

          "DRAWDOWN DATE" means a date upon which an Advance is made by the Bank
          to the Borrower pursuant to this Agreement.

          "DRAWDOWN NOTICE" means a notice of intention of the Borrower to
          borrow or redraw hereunder in the form or the effect of the form in
          Schedule I, signed by an Authorised Officer of the Borrower and
          received no later than 2.00pm (Eastern Standard Time) one (1) Business
          Day before the proposed date of such borrowing, redrawing by the Bank.

          "EVENT OF DEFAULT" means any of the events designated as such in this
          Agreement.

          "FACILITY" means the commitment to provide Advances under this
          Agreement.

          "FINANCIAL YEAR" means the period from 1 July to the next following 30
          June or such other period of one (1) year as the parties may agree in
          writing from time to time.

          "FIXED RATE LOAN" means a Cash Advance made under the Facility for a
          term or more than 180 days with an interest rate fixed for the whole
          of the term of such advance.

          "GUARANTEED AMOUNT" means the aggregate of the Accommodation Limit and
          the Overdraft Limit specified in Schedule VII and any other agreed
          amount.

          "GUARANTOR" means its successors and permitted assigns.

          "INTEREST PERIOD" means each period of each Advance being a period of
          not less than 1 day nor more than 180 days or such other period as the
          Bank and the Borrower may agree provided that such period shall not
          extend beyond the Repayment Date.

          "LOANS" means the aggregate of all Principal Moneys which are from
          time to time owing (including contingently owing) or unpaid to the
          Bank and all other monies from time to time owing (including
          contingently owing) and unpaid to the Bank under this Agreement.

          "PRINCIPAL MONEYS" means the aggregate of the Advances outstanding.

          "QUARTER" means each quarter period ending on the last days of March,
          June, September and December in each year.

          "REFERENCE BANKS" means such banks as may from time to time be
          determined by the Bank to be "Reference Banks".

          "REPAYMENT DATE" means with respect to Advances the Termination Date.

          "SECURITY INTEREST" means any security or preferential interest or
          arrangement of any kind in any asset or other right of or arrangement
          of any kind with any creditor to have its claim satisfied before other
          creditors with or from the proceeds of any asset, any deposit of money
          by way of security and any retention of title other than in the
          ordinary course of day to day trading conducted at arms length not
          including a charge or lien arising in favor of a governmental agency
          by operation or statute unless there is a default in payment of money
          secured by that charge or lien.

          "SUBSIDIARY" means

          (a)  a subsidiary as defined in the Corporations Law; or


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          (b)  in respect of a person any entity of which that person owns or
               controls, or is in a position to own or control whether directly
               or indirectly, more than fifty per cent (50%) of the capital or
               voting rights; and includes any subsidiary formed or acquired
               after the date of this Agreement.

          "TERMINATION DATE" means January 1, 2002.

    1.2   CONSTRUCTION

          In this Agreement unless the context otherwise requires:

          (a)  A reference to any Act of Parliament or to any section or
               provision thereof shall be read as if the words "or any statutory
               modification or re-enactment thereof or any statutory provision
               substituted therefore" were added to such reference.

          (b)  A reference to winding up shall when applied to individuals be
               deemed to refer to bankruptcy.

          (c)  A reference to an accounting term or "Australian Accounting
               Standards" is to be interpreted in accordance with approved
               accounting standards and practices under the Corporations Law,
               and, where not inconsistent with those accounting standards and
               practices generally accepted principles and practices in
               Australia consistently applied to a body corporate or as between
               bodies corporate and over time. A reference to "consolidated" in
               relation to accounts or other financial information, data or
               statistics with respect to a person means treated for accounting
               purposes as if accounting standards and generally accepted
               accounting principles for the creation of consolidated accounts
               applicable to a holding company and its subsidiaries applied to
               the person.

          (d)  References to sub-clauses, clauses and schedules are references
               to sub-clauses, clauses and schedules of this Agreement.

          (e)  References to any agreement, license or other instrument shall be
               deemed to include references to such agreement, license or other
               instrument as varied or replaced from time to time.

          (f)  Words importing any gender shall include all other genders; words
               importing individuals shall include partnerships and corporations
               and vice versa; words importing the singular number shall include
               the plural and vice versa; the index (if any) any headings are
               for convenience and shall not affect the interpretation of this
               Agreement.

          (g)  Where under or pursuant to this Agreement or anything done under
               this Agreement the day on or by which any act, matter or thing is
               to be done is not a Business Day such act, matter or thing may be
               done on the next succeeding day which is a Business Day (except
               with respect to the payment of monies payable under this
               Agreement which shall be made on the immediately preceding day
               which is a Business Day).

2.  THE FACILITY

    2.1   The Bank agrees to furnish to the Borrower upon and subject to the
          terms and conditions of this Agreement Advances up to the
          Accommodation Limit in aggregate.

    2.2   The Facility may be made available in Australian currency .

    2.3   The Borrower may request that any part of the Facility be made
          available either in Australian currency or in a currency other than
          Australian currency.

          In the event that the Borrower shall request that any part of the
          Facility be made available in a currency other than Australian
          currency then the Bank shall not be required to so make that part of
          the Facility available in a currency other than Australian currency
          if:


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          2.3.1 the aggregate amount borrowed in Australian currency and the
                then Australian dollar countervalue of any currency other than
                Australian currency (calculated as provided in Clause 2.7)
                borrowed or to be borrowed shall be greater than the
                Accommodation Limit; or

          2.3.2 the Bank is not satisfied with any designated period of
                borrowing or risk exposure; or

          2.3.3 for any reason whatsoever it is impractical for the Bank to make
                available any accommodation under the Facility in a currency
                other than Australian currency;

    2.4   Where any accommodation under the Facility is denominated in a
          currency other than Australian currency, repayment or payment in
          respect of such accommodation and payments of interest thereon and
          fees in respect thereof shall be made by the Borrower in the currency
          of such accommodation.

    2.5   The Borrower agrees that currency fluctuations are to the account of
          the Borrower and that the Borrower bears the risk for the same.

    2.6   All sums falling due hereunder by way of interest or fees on a per
          annum percentage basis shall be calculated on the basis of a 365 day
          year for Advances or fees payable in Australian currency and a 360 day
          year for all other currencies for the actual number of days elapsed.

    2.7   The Australian dollar countervalue of any amount of any currency other
          than Australian currency to be determined for any purpose shall, as
          between the Bank and the Borrower, be calculated at the Bank's spot
          selling rate of exchange in respect of the same on the day any such
          calculation is required to be made at the particular time of the day
          determined by the Bank. A certificate signed by the Bank stating any
          such rate of exchange shall be conclusive evidence of such rate of
          exchange.

    2.8   Subject to any specific provision to the contrary and to Clause 2.9,
          where the Borrower comprises two or more persons they are bound
          jointly, each of them severally and any two or more of them jointly
          and severally.

    2.9   The only party liable as a principal debtor under this Agreement in
          relation to any Advances is the party that draws the Advance.

3.  ACCOMMODATION LIMIT

    3.1   At any one time the aggregate amount of Advances outstanding shall not
          exceed the Accommodation Limit.

    3.2   The Bank shall not be obliged to make any Advance to the Borrower if
          to so do would result in a breach of Clause 3.1.

    3.3   The Bank may act upon the oral instruction of any of the following
          persons in the position of: Chief Financial Officer, Treasurer,
          Controller, Director of Cash Management of the Guarantor or Financial
          Controller of the Borrower.

4.  PURPOSE OF THE FACILITY

    Utilisation of this Facility by the Borrower under this Agreement shall be
    used solely for the Approved Purposes and no other purpose except with the
    prior written approval of the Bank to do otherwise. The Bank shall not have
    any responsibility to ensure that it is so utilised.

5.  ADVANCES

    5.1   Each Advance shall be repayable at the stated maturity date
          established by the Bank (from an overnight basis to a period not to
          exceed 180 days nor the Repayment Date) at or about the time of
          Advance or, if no such stated maturity is established, upon demand.
          All Advances must be repaid by the Repayment Date.

    5.2   Interest for each Advance shall be calculated to be a margin as
          determined by the Pricing Grid in Appendix A plus BBSY as agreed to
          between the Bank and the Borrower.


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    5.3   Interest shall be calculated daily and be paid monthly in arrears,
          save that the last interest payment shall be made on the Repayment
          Date.

    5.4   The Borrower may repay an Advance in whole (but not in part) before
          the maturity date if, but only if:

          5.4.1 The Borrower gives the Bank at least 5 business days irrevocable
                notice in writing of the Borrower's intention to repay;
          5.4.2 The Borrower makes payment to the Bank of all moneys payable
                pursuant to subparagraph 5.5;
          5.4.3 The Borrower makes payment on the day of payment specified in
                the notice.

    5.5   In the event that the Borrower wishes to make early repayment of an
          Advance or if for any reason early repayment of an Advance is demanded
          by the Bank as a result of an Event of Default, the Borrower shall pay
          to the Bank in addition to all other moneys then payable an amount
          sufficient to compensate and to indemnify the Bank for and against all
          losses (including loss of profits), costs, damages and expenses which
          the Bank determines that the Bank will or is likely to suffer or incur
          as a result of such early repayment. The Borrower acknowledges that
          the Bank may endeavour to arrange or enter into an interest rate swap
          agreement or other commitment and may as a consequence of this
          (whether directly or indirectly) suffer or incur losses, costs,
          damages or expenses in the event that all or part of the relevant
          advance is repaid prior to the due date of payment.

    5.6   All notices of drawdown (whether verbal or written) shall be
          irrevocable. The obligations of the Borrower shall be absolute and
          unconditional and shall not be subject to any reduction, termination,
          or other impairment by any set-off, deduction, counterclaim,
          agreement, defence, suspension, deferment, or otherwise, and the
          Borrower shall not be released from any obligations under the
          Facility, nor shall such obligations be prejudiced or affected for any
          reason including without limitation:

          5.6.1 by any falsity, inaccuracy, insufficiency or forgery which on
                its face purports to be signed or authorised pursuant to a
                Notice of Drawdown;
          5.6.2 by any failure by the Bank to inquire whether any cable, fax or
                telex has been inaccurately transmitted or received, or has been
                sent by an unauthorised person.

    5.7   Any Advance may, at the discretion of the Bank, be made by a nominated
          subsidiary of the Bank. In such event the Bank shall be agent of the
          nominated subsidiary in all matters dealing with payment and recovery.

    5.8   Whenever the Borrower intends to borrow or redraw any of Advance
          amount under the Facility, it shall give the Bank a Drawdown Notice of
          such intent no later than 2.00pm (Eastern Standard Time) one (1)
          business day before the proposed date of such borrowing or redrawing.
          A Drawdown Notice for an Advance shall be in the form or the effect of
          the form in Schedule I. The Bank's acceptance of such Drawdown notice
          is subject to Clause 3.

6.  LETTERS OF CREDIT - SECTION DELIBERATELY LEFT BLANK

7.  SBLC - SECTION DELIBERATELY LEFT BLANK

8.  INTEREST

    The Borrower shall pay to the Bank interest on all further monies (other
    than interest) due and unpaid by the Borrower to the Bank under or pursuant
    to this Agreement at the rate of five (5%) per cent above the rate of the
    Bank's Overdraft Reference Rate which applies as at the date such monies
    become due and payable. All interest which accrues under this sub-clause
    during any calendar month shall become due and payable by the Borrower to
    the Bank on the last Business Day of that calendar month and if not then
    paid shall be compounded and bear interest accordingly.

9.  FEES

    9.1   Establishment Fee: N/A.


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    9.2   Line Fee: The Borrower shall pay to the Bank a line fee as determined
          by the Pricing Grid in Appendix A, per annum calculated in respect of
          each Quarter on the Accommodation Limit and be payable Quarterly in
          arrears. The Line Fee shall accrue from the date of signing this
          Agreement.

    9.3   Expenses: Whether or not the Borrower shall draw down under this
          Agreement the Borrower shall forthwith reimburse the Bank for the
          charges and expenses incurred by the Bank.

          9.3.1 in contemplation of or in carrying out its duties under this
                Agreement;
          9.3.2 in connection with the negotiation preparation or execution of
                this Agreement or the administration of this Agreement; and
          9.3.3 in connection with the enforcement of, or the exercise or
                purported or attempted exercise of any right, authority or
                remedy conferred on the Bank under or by virtue of this
                Agreement;

          including in each case the fees and expenses of legal advisers on a
          solicitor and own client basis and all stamp duty (including financial
          institutions duty and duty passed on to the Bank by any bank or
          financial institution) levied on or in connection with this Agreement
          or any payment or the receipt of any payment under this Agreement.

    9.4   The Borrower shall forthwith pay any and all stamp duty (including any
          financial institutions or other receipts duty) registration and
          similar taxes or charges imposed by governmental authorities which may
          have been paid or may be payable or determined to be payable in
          connection with:

          9.4.1 the execution, delivery, performance or enforcement of this
                Agreement;
          9.4.2 on or in respect of any transaction contemplated by this
                Agreement;
          9.4.3 any other matter or thing done or arising out of or in
                connection with this Agreement; or
          9.4.4 any transaction related to this Agreement;

          and shall indemnify the Bank against any and all liabilities with
          respect to or resulting from delay or omission to pay such taxes or
          charges including any fines or penalties (save those due to delay or
          negligence on the part of the Bank).

    9.5   Increase in Costs by Government Action

          If any law, regulation or regulatory requirement or judgement, order
          or direction of any court, tribunal or authority binding on the Bank
          in any jurisdiction taking effect after the date of this Agreement, or
          if compliance by the Bank with any direction, request or requirement
          (whether or not having the force of law) or any competent governmental
          or other authority, shall:

          9.5.1 subject the Bank to taxes or change the basis of taxation of the
                Bank with respect to any payment under this Agreement; or
          9.5.2 impose, modify or deem applicable any reserve or prudential or
                capital adequacy requirement or require the making or the
                varying of terms of any special deposits against or in respect
                of any assets or liabilities (whether contingent or otherwise)
                of, deposits with or for the account of, or loans by, the Bank;
                or
          9.5.3 impose on the Bank any other conditions with respect to this
                Agreement or its obligations under this Agreement;

          and if, as a result of any of the foregoing:

          9.5.4 the cost to the Bank of making or keeping the Facility available
                or otherwise performing its obligations under this Agreement or
                allocating its capital resources is increased; or
          9.5.5 the amount payable or the effective rate of return on its
                overall capital to the Bank under this Agreement is reduced; or
          9.5.6 the Bank makes a payment or foregoes or suffers a reduction in a
                return on or calculated by reference to any amount payable to it
                under this Agreement;

          then, and in each such case, the Bank shall notify the Borrower and
          give the Borrower the option exercisable by notice in writing to the
          Bank within ten (10) Business Days of receipt of notice of the Bank
          of:


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          9.5.7 paying an amount or amounts to the Bank from time to time on
                demand to compensate the Bank in full for any cost or reduction
                of the kind referred to effective from the date on which the
                cost or reduction is actually incurred by the Bank; or
          9.5.8 terminating this Agreement on the first to occur of the end of
                the then current Interest Period and the Repayment Date by
                paying to the Bank the debt owing to it on that date with
                accrued interest and all other monies payable under this
                Agreement, together with an amount determined by the Bank to
                compensate it up to that date for actual cost or reduction of
                the type referred to.

          If the Borrower fails to make an election the Borrower shall be deemed
          to have made the election in sub-clause 5.7 of this Clause. The Bank's
          certificate in respect of any cost or reduction of the kind referred
          to shall be prima facie evidence of the incurring of any such cost or
          reduction, except in the case of manifest error.

    9.6   Gross Up

          9.6.1 If at any time any applicable law, regulation or regulatory
                requirement of any government authority, monetary agency or
                central bank requires the Borrower to make any deduction or
                withholding in respect of taxes from any payment due under this
                Agreement:

                (a)  the sum due from the Borrower in respect of the payment
                     shall be increased to the extent necessary to ensure that,
                     after the making of the deduction or withholding, the Bank
                     receives a net sum equal to the sum which it would have
                     received had no such deduction or withholding been required
                     to be made; and
                (b)  the Borrower shall indemnify the Bank against any losses or
                     costs incurred by the Bank by reason of any failure of the
                     Borrower to make any such deduction or withholding.

                The Borrower shall promptly deliver to the Bank any receipts,
                certificates or other proof evidencing the amounts (if any) paid
                or payable in respect of any such deduction or withholding,
                together with any other information which the Bank may
                reasonably require.

          9.6.2 If the Bank or any person on its behalf is required by any
                applicable law regulation or regulatory requirement of any
                government authority, monetary agency or central bank to make
                any deduction or withholding from, or any payment on or
                calculated by reference to, any amount received or receivable
                under this Agreement (other than taxes payable on the overall
                net income of the Bank) then (without prejudice to sub-clause
                6.1) the Borrower shall upon demand indemnify and hold harmless
                the Bank against any such deduction, withholding or payment
                together with any related cost, loss, expense, interest,
                penalties or other liability by payment to each such person of
                such amounts and in such currencies as the person concerned may
                certify are required to compensate it for any such deduction,
                withholding or payment together with any related cost, loss,
                expense, interest, penalties or other liability.

    9.7   GST Gross Up

          In this clause, 9.7, GST means a goods and services or similar tax
          imposed in Australia, together with any related interest, penalties,
          fines or other charges.

          9.7.1 Notwithstanding any other provision of this Agreement:

            (a) in the event that GST has application to any supply made under
                or in connection with this agreement by a party, that party may,
                in addition to any amount or consideration payable under this
                Agreement, recover from the Borrower an additional amount on
                account of GST, such amount to be calculated by multiplying the
                relevant amount or consideration payable by the Borrower for the
                relevant supply by the prevailing GST rate; and/or

            (b) without limiting the generality of the foregoing, in the event
                that a party (other than the Borrower) is not entitled to an
                input tax credit in respect of the amount of any GST charged to
                or recovered from that party by any person, or payable by that
                party, or in respect of any amount which is recovered from that


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                party by way of reimbursement of GST referable directly or
                indirectly to any supply made under or in connection with this
                Agreement, that party shall be entitled to increase any amount
                or consideration payable by the Borrower on account of such
                input tax and recover from the Borrower the amount of any such
                increase.

          9.7.2 Any additional amount on account of GST, or on account of an
                amount for which a party is not entitled to an input tax credit,
                recoverable from the Borrower pursuant to sub-paragraph 9.7.1(a)
                or (b) of this clause shall be calculated without any deduction
                or set-off of any other amount and is payable by the Borrower
                upon demand by the party whether such demand is by means of an
                invoice or otherwise.

          9.7.3 Each party will use its best endeavors to determine reasonably
                the extent (if any) to which any amount payable by the Borrower
                to that party for any supply made under this Agreement may be
                reduced as a direct consequence of the abolition of or reduction
                in any taxes, duties, or statutory charges paid or payable by
                that party (as part of the imposition of GST) which directly
                relate to the supply by that party, and the amount payable by
                the Borrower to that party shall be reduced only to the extent
                of the reduction (if any) so determined by the Bank.

          9.7.4 Without limiting sub-paragraph 9.7.1(a), if requested by the
                Borrower in writing the relevant party will provide an invoice
                in relation to any supply to which sub paragraph 9.7.1(a) has
                been applied no later than 28 days after the request is made.

10. TERMINATION OF FACILITY

    Subject to any agreement in writing to the contrary entered into the Bank
    and the Borrower the Facility shall terminate on the Termination Date and
    the Borrower shall pay to the Bank the Advances forthwith.

11. CONDITIONS PRECEDENT

    11.1  To the Facility

          The granting of this Facility is subject to the Bank receiving prior
          to any requests of the Borrower, all of the following in the form and
          substance satisfactory to the Bank:

          11.1.1 There exists no Event of Default

          11.1.2 A copy of the Board resolution of the Borrower authorising the
                 Borrower to enter into this Agreement and appointing authorised
                 persons to sign all applications notices and documents to be
                 delivered hereunder and for the operation of the Facility; and
                 specimen signatures of the authorised persons appointed under
                 the Board resolution referred to herein.

          11.1.3 A copy of this Agreement duly executed by the Borrower.

          11.1.4 A Guarantee duly executed by the Guarantors in a form and
                 substance acceptable to the Bank.

          11.1.5 A copy of the Board resolution of the Guarantor authorising the
                 issuance of the guarantee referred to in sub clause 11.1.5, and
                 appointing authorised persons to sign all applications notices
                 and documents to be delivered hereunder; and specimen
                 signatures of the authorised persons appointed under the Board
                 resolution referred to herein.

    11.2  To a Drawdown

          The obligation of the Bank to make any Advance is subject to the
          fulfillment (to the reasonable satisfaction of the Bank) of the
          following conditions precedent:

          11.2.1 The Bank has duly received from the Borrower a request for a
                 Drawdown in the form of a Drawdown Notice;
          11.2.2 All representations give to the Bank herein are true and
                 correct as at the date of such Advance;
          11.2.3 No Event of Default exists.


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          11.2.4 The Bank is satisfied that there has been no material or
                 adverse change in the financial condition of the Borrower.
          11.2.5 This Agreement is valid and binding on the Borrower and is
                 enforceable in accordance with its terms.
          11.2.6 The Bank has received the items outlined in sub clause 11.1 and
                 such other things as it may reasonably require before drawdown.

12. REPRESENTATIONS AND WARRANTIES

    The Borrower represents and warrants to the Bank as follows:

    12.1  The Borrower is a limited liability corporation duly incorporated and
          validly existing under the laws of Australia and has the corporate
          power to own property and assets and to carry on business as it is now
          being conducted.

    12.2  This Agreement constitutes a legal valid and immediately binding
          obligation on the Borrower and is enforceable in accordance with its
          express terms.

    12.3  Third Party Rights The execution, delivery and performance of this
          Agreement by the Borrower shall not violate in any respect any
          provision of:

          12.3.1 any law or regulation or any order or decree or any government
                 authority, agency or court of the Commonwealth of Australia or
                 of a State or Territory thereof;
          12.3.2 the Memorandum or Articles of Association of the Borrower; nor
          12.3.3 any mortgage, contract or other undertaking or instrument to
                 which the Borrower is party or which is binding upon the
                 Borrower or any of its assets.

    12.4  All authorizations, approvals, consents, licenses, filings,
          registrations, notarizations and other requirements or any
          governmental judicial or public body, authority, bureau or agency in
          the Commonwealth of Australia or in a State or Territory thereof now
          obtainable and required in connection with the execution, delivery,
          performance, validity or enforceability of this Agreement have been
          obtained or effected and are in full force and effect and true copies
          thereof (where applicable) have been delivered to the Bank and all
          fees payable in connection therewith have been paid and there has been
          no default in the performance of any of the terms or conditions of any
          of the same.

    12.5  The Borrower is not in default under any agreement undertaking or
          instrument to which it is a party or by which it is bound, such
          default being material in the context of this Agreement and no event
          has occurred which with the giving of notice or lapse of time or both
          would constitute such a default.

    12.6  No litigation or governmental proceeding is pending or, to the
          knowledge of the Borrower, threatened against the Borrower or any of
          its Subsidiaries which could have a material adverse effect on the
          condition, financial or otherwise, of the Borrower and its
          Subsidiaries on a consolidated basis

    12.7  The Borrower and each of its Subsidiaries have duly filed all taxation
          returns required to be filed (none of which are so far as the Borrower
          is aware likely to be the subject of any dispute) and have paid all
          taxation levied or assessed upon it has complied with all assessments
          and notices in respect thereof of have established adequate reserves
          for payment thereof.

    12.8  The obligations of the Borrower under this Agreement rank at least
          equally with all other unsecured and unsubordinated indebtedness of
          the Borrower except any liabilities mandatory preferred by law.

    12.9  In entering into this Agreement the Borrower is not acting as a
          trustee of any trust or settlement.

    12.10 The Borrower holds all necessary licenses permits consents approvals
          or authorities for its business and property and use of premises and
          such are valid in full force and effect in all respects and are in
          good standing and all fees due in respect thereof have been paid and
          all conditions relating thereto have been duly complied with and no
          notice of breach or termination thereof has been given or has been or
          is threatened and no circumstances have arisen or are in existence to
          the knowledge of the Borrower which would with the

9
<PAGE>   10
          giving of notice or lapse of time or both entitle any competent
          authority to call into question suspend cancel or terminate the same
          nor are there any circumstances to indicate that equivalent licenses
          permits consents approvals or authorizations would not be granted to
          the Borrower upon renewal on no less favorable terms than exist now.

    12.11 All risks usually insured against according to sound commercial
          practice by persons carrying on activities similar to the Borrower's
          are fully insured against in amounts representing the present full
          replacement or reinstallation values or market values and in the name
          of and for the benefit of the Borrower absolutely.

    12.12 The Borrower is not aware of any fact or circumstance which might
          reasonably be expected to affect in any material adverse way the
          financial position, operations, aspects, profitability, or prospects
          of the Borrower or the business of the Borrower or the value of the
          property of the Borrower other than those expressly disclosed in
          writing to the Bank or affecting as a whole the industry in which the
          Borrower participates.

    12.13 All information provided by or on behalf of the Borrower whether prior
          to or after the date of this Agreement to the Bank is true and correct
          and is not, by the omission of information or otherwise, misleading
          and all projections contained therein were arrived at after the due
          and careful consideration and were based on the best information
          available and on fair assumptions.

    The representations and warranties in this clause shall be deemed to be
    repeated by the Borrower on and as of the date of each Advance or issue of
    Letter of Credit or Guarantee (as the case may be) as if made with
    reference to the facts and circumstances existing at such date.

    The Borrower acknowledges that the Bank relies on the representations and
    warranties made or given in this Agreement by the Borrower and that the
    Bank is induced by each such representation and warranty to enter into this
    Agreement and the rights of the Bank in respect of a breach of any such
    representation or warranty shall not be affected by investigation (if any)
    made by the Bank into the affairs of the Borrower.

13. GENERAL OBLIGATIONS

    The Borrower hereby so far as the following shall apply to the Borrower
    agrees that on and from the date of this Agreement and so long as any
    amount payable under this Agreement is outstanding:

    13.1  The Borrower shall take all action necessary to obtain and promptly
          renew from time to time all authorizations, approvals, consents,
          licenses and exemptions as may be required under any applicable law or
          regulation to enable the Borrower to perform its obligations under
          this Agreement or required for the validity or enforceability of this
          Agreement or any transaction contemplated by this Agreement.

    13.2  The Borrower shall prepare and maintain in accordance with Australian
          Accounting Standards proper and adequate books and records reflecting
          fully all transactions entered into by the Borrower and all its
          Subsidiaries.

    13.3  The Borrower shall promptly notify the Bank in writing of the
          occurrence or pending or threatened occurrence of any event which may
          cause or constitute a breach of any of the representations or
          warranties or agreements of the Borrower in this Agreement including
          any event which may result in a material change in the business of the
          Borrower and any other event which constitutes or which may with the
          giving of notice or lapse of time or both or other conditions
          constitute an Event of Default.

    13.4  The Borrower shall comply with all requirements of the Corporations
          Law or of the corresponding legislation of any other place applicable
          to the Borrower.

    13.5  The Borrower shall permit representatives of the Bank (or any
          accountants or other experts designated by it) during normal business
          hours and upon reasonable notice to visit and inspect and examine the
          books of account records (excluding company minute books), reports and
          other papers (and to make copies and to take extracts therefrom) of
          the Borrower and to discuss its affairs, finances and accounts with
          its officers, accountants and auditors, all at such times and as often
          as may be reasonably requested by the Bank but only in so far as such
          matters relate to information as may reasonably be required by the
          Bank for any purpose connected with this Agreement.


10
<PAGE>   11
    13.6  Neither the Borrower nor any of its Subsidiaries shall, except as
          permitted in this Agreement, without the prior written consent of the
          Bank create or assume or permit to exist or arise any Security
          Interest whatsoever over any part of its present or future
          undertakings, property, assets uncalled capital or revenues. The
          Borrower and its Subsidiaries represent and warrant to the Bank that
          there is no such Security Interest over any part of their present or
          future undertakings, property, assets, uncalled capital or revenues in
          existence as at the date of this Agreement.

    13.7  The Borrower shall permit the Bank upon written request of the Bank to
          from time to time inspect the register of the members of the Borrower
          at the Borrower's registered office or other place or places where the
          register or any branch register is so kept at any time during regular
          business hours and the Borrower shall furnish the Bank with any
          information which the Bank may consider reasonably necessary to enable
          it to determine whether or not there has been at any time after the
          date of this Agreement a transfer of the effective management and
          control of the Borrower.

    13.8  The Borrower shall furnish to the Bank copies of all such accounts,
          documents, reports, notices, circulars, particulars and certificates
          which are required to be furnished by the Borrower to any stock
          exchange, corporate affairs office (or analogue office) or shareholder
          at the same time as they are furnished to that stock exchange,
          corporate affairs (or analogous office) or shareholder and when
          requested by the Bank copies of such documents, reports, notices,
          circulars, particulars or certificates which are required under the
          provision of any trust deed to which the Borrower is a party to be
          furnished to the trustee thereunder from time to time.

    13.9  The Borrower shall comply in all material respects with all applicable
          laws, rules, regulations and orders including, without limitation,
          paying when due all taxation, assessments and governmental charges
          imposed upon it or its assets and all other claims which may become a
          lien upon any of its property except to the extent contested in good
          faith and by appropriate procedure unless the loss of such contested
          proceedings would have a material adverse effect on the ability of the
          Borrower to meet its obligations under this Agreement.

    13.10 The Borrower shall provide updated signatory lists and specimen
          signatures from time to time of persons authorised to sign documents
          and operate the Facility.

14. FINANCIAL INFORMATION

    The Borrower shall supply the Bank with all financial or other information
    as the Bank may reasonably request in writing always including the
    following without request:

    14.1  As soon as possible but in any event within 120 days of the end of
          each Financial Year copies of the audited annual profit and loss
          statement and balance sheet of the Guarantor and unaudited annual
          profit and loss statement and balance sheet of the Borrower along with
          corresponding accounting workpapers prepared in accordance with
          Guarantor audit.

    14.2  As soon as possible but in any event within 60 days of the end of each
          quarterly period a copy of the management accounts and of the
          unaudited balance sheet and profit and loss statement of the Borrower
          and the Guarantor.

    14.3  Quarterly certificate of compliance from the Guarantors that they are
          not in breach of any obligations or covenants under any of their debt.

    All of the financial information referred to above shall be prepared in
    accordance with applicable accounting standards.

15. FINANCIAL COVENANTS - SECTION DELIBERATELY LEFT BLANK

16. EVENTS OF DEFAULT

    If any of the following events occur ("Events of Default") the Loans shall
    at the option of the Bank and notwithstanding any delay or previous waiver
    of the right to exercise such option become immediately due and payable
    upon written demand by the Bank to the Borrower and the obligations to the
    Bank under this Agreement shall be cancelled on the occurrence of any of
    the following events;


11
<PAGE>   12
    16.1  If the Borrower fails to pay the Loans or any part thereof or any
          interest thereon or any other monies payable to the Bank at or before
          the due time on the due date in the manner specified in this Agreement
          and such default continues for more than three (3) days.

    16.2  If the Borrower fails to observe or perform any obligations to be
          observed or performed by it under this Agreement or in connection with
          any transaction contemplated by this Agreement and if such default
          shall in the opinion of the Bank be capable of prompt remedy, the
          Borrower shall not have remedied such default within five (5) days
          after notification by the Bank to the Borrower requiring remedy of
          such default.

    16.3  Any representation or statement made or deemed to be made by the
          Borrower in this Agreement or in writing pursuant to this Agreement
          shall not be complied with or shall prove to be untrue in any respect
          which materially adversely affects the interests of the Bank on any
          date as of which it was made or deemed made.

    16.4  The Borrower fails to duly pay any debt constituting principal and
          interest owed by it to any other persons other than the Bank with
          respect to borrowed money or money otherwise owed under any note,
          bond, or similar instrument or fails to pay when the same becomes due
          and payable in excess of A$35,000 and which breach or default has not
          been waived and, with notice or the passage of time, or both, allows
          the maturity of such debt to be accelerated.

    16.5  If all or any part of this Agreement becomes void, illegal, invalid,
          unenforceable, or of limited or reduced force or effect.

    16.6  Any other present or future indebtedness of the Borrower, or any
          Subsidiary of the Borrower for borrowed money shall become due and
          payable prior to the stated maturity thereof as a result of a default
          or any such indebtedness shall not be paid on the due date thereof or
          upon the expiration of any applicable grace period therefor, or the
          Borrower, or any Subsidiary of the Borrower shall fail to pay when due
          or upon the expiration of any applicable grace period therefor any
          amount payable by it under any present or future guarantee for
          borrowed money or for the purchase of fixed assets on deferred terms
          or any encumbrance over any assets of the Borrower, or any Subsidiary
          of the Borrower shall be or become enforceable.

    16.7  A distress or other execution is levied or enforced upon or against
          any part of the property of the Borrower for an amount exceeding
          A$500,000.00 and is not withdrawn or satisfied within fourteen (14)
          days of having been so levied or enforced and the Bank considers that
          such event is prejudicial to the interests of the Bank under this
          Agreement.

    16.8  If the Borrower fails (as defined in Section 459F of the Corporations
          Law) to comply with a statutory demand (as defined in Section 9 of the
          Corporations Law) or is presumed to be insolvent pursuant to Section
          459C(2)(a) of the Corporations Law or admits such fact in writing.

    16.9  If the Borrower is wound up or if a petition is presented or an order
          is made for the winding up of the Borrower and is not withdrawn within
          fourteen (14) days or if a resolution is passed for the winding up of
          the Borrower otherwise than for the purpose of reconstruction or
          amalgamation the terms of which have previously been approved in
          writing by the Bank such approval not to be unreasonably withheld.

    16.10 If a receiver or receiver and manager is appointed in respect of any
          part of the assets of the Borrower or an encumbrancer takes possession
          of the undertaking or the property of the Borrower or any part
          thereof.

    16.11 If the Borrower makes default under any charge or security in favor or
          any person other than the Bank.

    16.12 If an inspector of all or any part of the affairs of the Borrower is
          appointed pursuant to the Corporations Law (or the corresponding
          legislation of any place applicable to the Borrower).

    16.13 If the Borrower suspends payment of its debts, which expression shall
          have the meaning that it has for the purposes of Section 40 of the
          Bankruptcy Act 1966 of Australia.

    16.14 If a compromise or arrangement is proposed between the Borrower and
          its creditors or any class of them or if an application is made to a
          court for an order summoning of creditors or any class of them of the
          Borrower.


12
<PAGE>   13
    16.15 If without the prior written consent of the Bank the Borrower reduces
          or attempts to reduce its capital or buy back any of its shares.

    16.16 If the Borrower stops payment generally.

    16.17 If the Borrower is placed under voluntary administration pursuant to
          Part 5.3A of the Corporations Law or causes or propose to cause a
          meeting of its creditors to be summoned for the purposes of placing it
          under administration pursuant to Part 5.3A of the Corporations Law.

    16.18 If any of the property of the Borrower or the ownership of which is in
          the opinion of the Bank material to the ability of the Borrower to
          perform its obligations under this Agreement is seized or otherwise
          expropriated nationalized confiscated or acquired through any
          governmental action or intervention or if custody or control of such
          property shall be assumed by any government or government agency.

    16.19 If any governmental or semi-governmental authorization approval
          license consent or agreement which the Bank deems essential to the
          Borrower's performance of its obligations under this Agreement is
          revoked terminated cancelled or withheld.

    16.20 If without the prior written consent of the Bank the Memorandum or
          Articles of Association of the Borrower is altered in a manner which
          in the reasonable opinion of the Bank is material to the performance
          by the Borrower of its obligations under this Agreement.

    16.21 If a meeting of the Borrower is called for the purpose of considering
          and if thought fit passing any resolution the passing of which would
          constitute or give rise to an Event of Default.

    16.22 If in the opinion of the Bank there is a material change in the
          ownership control or management of the Borrower which is likely to
          adversely affect the ability of the Borrower to conduct its business
          in a proper manner and to carry out its obligations under this
          Agreement

    16.23 If the Borrower defaults in the performance or observance of any
          provision of any other indebtedness to or security of the Bank and the
          Borrower whether the indebtedness or security is collateral to this
          Agreement or whether it is a separate Agreement between the Bank and
          the Borrower and such default continues for more than seven (7) days
          after the due date.

    16.24 If the Borrower shall do any act deed matter or thing or knowingly or
          willingly permit or suffer any act deed matter or thing to be done
          whereby directly or indirectly the security of the Bank shall in the
          opinion of the Bank become deteriorated or lessened in value.

    16.25 If the Borrower shall at any time not have an auditor appointed
          pursuant to the provision of the Corporations Law.

    16.26 If the Borrower makes any material change to the business it carries
          on without the prior written consent of the Bank or if the Borrower
          ceases or threatens to cease to carry on its business.

    16.27 If the Borrower suffers any material adverse change in its financial
          condition which may materially affect the interest of the Bank unless
          such change is agreed to in writing by the Bank.

     16.28 The Guarantor shall cease, directly or indirectly, to own free and
           clear of all liens or other encumbrances, 75% of the issued share
           capital of the Borrower.

     16.29 If any of the above events of default occur in respect of the
           Guarantor.

     16.30 If the Guarantor withdraws its Guarantee

     16.31 If either Guarantor defaults under any of its credit agreements.

17.  INDEMNITIES


13
<PAGE>   14
     The Borrower indemnifies the Bank from and against all actions, suits,
     claims, demands, losses, liabilities, damages, costs and expenses which may
     be made or brought against or suffered or incurred by the Bank arising out
     of or in connection with:

    17.1  any Event of Default or any event which with the giving of notice, the
          passage of time or the fulfillment of any other condition would become
          an Event of Default; or

    17.2  any failure by the Borrower to take an Advance in accordance with any
          request for a Drawdown.

18. CERTIFICATIONS

    18.1  Any document or thing required to be certified by the Borrower shall
          be certified by a director or secretary of the Borrower or in such
          other manner as the Bank may approve.

    18.2  A certificate signed by an Authorised Officer of the Bank stating any
          amount or rate for the purpose of this Agreement shall in the absence
          of manifest error be conclusive and binding on the Borrower.

19. POWER OF ATTORNEY

    If any Event of Default occurs, the Borrower hereby irrevocably appoints
    the Bank and each Authorised Officer severally its attorney to do all acts
    and things which may or ought to be done by the Borrower under this
    Agreement and without limiting the generality of the foregoing the attorney
    shall have power in the name of the Borrower to sign, draw, endorse, accept
    or negotiate any draft, order, cheque, promissory note or other instrument
    of a like nature or not as the attorney shall think fit.

20. UNLAWFULNESS

    If:

    20.1  any law, regulation or regulatory requirement or judgment, order in
          direction of any court, tribunal or authority binding upon the Bank in
          the jurisdiction in which the Bank is formed or has its principal or
          lending office(s) or in which may action is required to be performed
          by it for the purposes of this Agreement; or

    20.2  any change in the interpretation of any such law, regulation or
          regulatory requirement or judgment, order or direction of any court,
          tribunal or authority by any government or governmental agency charged
          with the administration thereof or by a court of competent
          jurisdiction or compliance by the Bank with any respect or direction
          (whether or not having the force of law) of the Reserve Bank of
          Australia or any government or other governmental agency in accordance
          with whose requests or directions the Bank is accustomed to act;

    renders it unlawful for the Bank to meet any of its obligations under the
    Facility, the Bank shall promptly notify the Borrower and the following
    provisions shall apply:

    20.3  the Borrower and the Bank shall negotiate for a period not exceeding
          thirty (30) days with a view to the Bank making arrangements to be
          able to meet the relevant obligations under the Facility in whole or
          in part in a manner which is not unlawful; and

    20.4  if no such arrangements have been made by the end of such period,
          thereupon the Bank shall be released from its obligations under this
          Agreement, the Facility shall be cancelled and the Borrower shall pay
          to the Bank the Loans under this Agreement.

21. AUTHORITY TO DEBIT ACCOUNTS

    The Borrower irrevocably authorizes and directs the Bank to debit any
    account or accounts of the Borrower with the Bank in respect of any amounts
    that are from time to time due and payable under this Agreement.

22. NO WAIVER

    No failure to exercise and no delay in exercising on the part of the Bank
    any right, power or privilege under this Agreement shall operate as a
    waiver thereof, nor shall any single or partial exercise of any right power
    or privilege

14
<PAGE>   15
    preclude any other or further exercise thereof, or the exercise of any
    other right, power or privilege. The rights and remedies of the Bank
    provided in this Agreement are cumulative and not exclusive of any rights
    or remedies provided by law or equity or legislation or regulation.

23. MERGER

    23.1  The representations and warranties of the Borrower in this Agreement
          shall survive the execution of this Agreement and the making of any
          Advance or issue of Letter of Credit or Guarantee under this Agreement
          and shall inure for the benefit of the Bank until the Loans have been
          paid in full by the Borrower to the Bank.

    23.2  If the liability of the Borrower to pay to the Bank any moneys payable
          under this Agreement becomes merged in any deed, judgment, order or
          other thing the Borrower shall pay interest on the amount owing from
          time to time under this Agreement and that fixed by or payable under
          that deed, judgment, order or other thing.

24. TIME OF THE ESSENCE

    Time shall be of the essence as regards any date or period determined under
    this Agreement save only to the extent that any such date or period may be
    altered by mutual agreement between the parties whereupon time shall be of
    the essence as regards such altered date or period.

25. SET OFF

    25.1  the Borrower and the Bank do expressly acknowledge and agree that:

          25.1.1 Where the Bank now or at any time in the future is indebted on
                 any account to the Borrower pursuant to arrangements made
                 between them such arrangements are hereinafter referred to as
                 the "Arrangements".

          25.1.2 Notwithstanding the Arrangements and any other provision of
                 this Agreement (and without prejudice to the Bank's other
                 rights and remedies) any monies (whether by way of principal
                 interest or otherwise and whether present future actual or
                 contingent) which the Bank may now or may hereafter owe to the
                 Borrower under the Arrangements may be applied to and set off
                 by the Bank as and when the same may become due and payable pro
                 rata against the Loans as and when they become due and payable
                 to the intent and effect:

                 (i)  first that the Bank may at any time and from time to time
                      deduct from and retain out of the monies otherwise payable
                      by the Bank to the Borrower pursuant to the Arrangements
                      such amounts as the Bank may think fit and apply or set
                      off such amounts in or toward or against satisfaction of
                      the Loans; and

                 (ii) secondly that upon default by the Borrower hereunder the
                      Bank shall not be obliged to pay any monies to the
                      Borrower under the Arrangements until the obligations of
                      the Borrower to the Bank to pay any monies to the Bank
                      hereunder are paid and satisfied in full.

    25.2  The contractual rights of set off conferred on the Bank under
          sub-clause 25.1 of this clause are in addition to, and not in
          substitution for, any rights of set off otherwise conferred on or
          available to the Bank at law or in equity including (without
          limitation) any banker's rights of set off or right of combination of
          accounts or banker's lien.

    25.3  For the avoidance of doubt the Bank and the Borrower further declare
          and acknowledge that the debts and liabilities arising or created
          hereunder and pursuant hereto and under and pursuant to the
          Arrangements are mutual debts within the meaning of Section 86(1) of
          the Bankruptcy Act 1966 of the Commonwealth of Australia (as
          incorporated in the Corporations Law) and that upon the liquidation or
          bankruptcy of the Borrower the provisions of Section 86 of the said
          Bankruptcy Act shall apply so that any sum due from the Borrower to
          the Bank hereunder shall be set off against any sum due from the Bank
          to the Borrower under the Arrangements

    25.4  The Borrower acknowledges and agrees that it will not and will not
          attempt to prevent the Bank from exercising its rights of set off as
          aforesaid in the circumstances contemplated in respect thereof.


15
<PAGE>   16
26. APPROPRIATION

    The Bank may appropriate any payment towards the satisfaction of any moneys
    due by the Borrower in any way that the Bank thinks fit and notwithstanding
    any purported appropriation by the Borrower

27. SUCCESSORS

    This Agreement shall bind the parties and their respective heirs executors
    administrators successors and assigns.

28. ASSIGNMENT

    The Bank may at any time assign the benefits and obligations on its part to
    be enjoyed or performed under this Agreement. The Borrower shall not assign
    or purport to assign any of the benefits or obligations on its part to be
    enjoyed or performed under this Agreement without the consent in writing of
    the Bank.

29. NOTICES

    Any notice demand consent or other communication to be given under or in
    connection with this Agreement shall be in writing or if it is to be given
    by the Bank may be signed by any Authorised Officer of the Bank or any
    solicitor for the time being acting for the Bank and if it is to be given
    by the Borrower shall be under the common seal of the Borrower or the hand
    of an Authorised Officer of the Borrower and may be served either:

    29.1  personally; or

    29.2  by posing the same by registered or certified mail to the party to
          whom the notice is directed at its address appearing in this Agreement
          or at any other address of which prior notification shall have been
          given by post shall be deemed to have been received by the party to
          whom it is addressed at the expiration of forty eight (48) hours after
          the same has been properly posted; or

    29.3  by facsimile transmission;

          To the Bank: BANK ONE, NA, LEVEL 32, 60 MARGARET STREET, SYDNEY  NSW
                       2000
          Attention: MR W H GIFFEN
          Facsimile: (02) 9223 1823

          or by other facsimile number of which prior to notification shall
          have been given to the sender prior to the transmission of the
          facsimile and any facsimile transmission shall be deemed to have been
          served on the date of transmission by the sender if the sender shall
          receive confirmation of receipt from the recipient. The original of
          any facsimile transmission shall be posted in accordance with
          sub-clause 29.2 of this clause on the date of transmission or if
          transmitted after usual posting hours the next Business Day.

    If the date of dispatch is not a Business Day in the place to which such
    notice, request demand or other communication is sent it shall be deemed to
    have been received at the commencement of business on the next following
    Business Day in such place. Notice given to any one or more of the persons
    (if more than one) comprised in the expressions "the Borrower" shall be
    deemed notice to all such persons. Signatures may be manuscript or may be
    printed or reproduced by other mechanical means.

30. OTHER DOCUMENTS

    The Borrower shall either before or after the making of any Advance under
    this Agreement do all such acts matters and things and shall sign or
    execute and deliver all such documents or writing or assurances as may in
    the reasonable opinion of the Bank be necessary or expedient to further and
    more effectually carry into full effect the provisions of this Agreement
    and for conferring the full benefit thereof upon the Bank.


16
<PAGE>   17
31. AMENDMENT

    No amendment of this Agreement shall bind the parties unless made in
    writing expressed to be supplemental to or in substitution for the whole or
    part of this Agreement

32. GOVERNING LAW AND JURISDICTION

    This Agreement and the rights and obligations of the parties shall be
    governed by and construed in accordance with the laws in force in the state
    of NEW SOUTH WALES and the parties agree by the execution of this Agreement
    to irrevocably submit to the non-exclusive jurisdiction of the Courts in the
    state of NEW SOUTH WALES in respect of all matters arising under or in
    connection with this Agreement provided always that the Bank may proceed in
    the Courts of any Territory State or country having or claiming jurisdiction
    in respect of the matter which is the subject of the proceedings.

33. SEVERANCE

    Any provision of this Agreement which is or becomes prohibited invalid
    unlawful void or unenforceable in any jurisdiction shall, as to such
    jurisdiction, be ineffective and capable of severance without affecting the
    remaining provisions of this Agreement or affecting the validity or
    enforceability of such provision in any other jurisdiction.

34. COUNTERPARTS

    This Agreement may be executed in any number of counterparts and all of such
    counterparts taken together shall be deemed to constitute one and the same
    instrument.

35. ENTIRE AGREEMENT

    This Agreement contains all of the terms and conditions upon which the Bank
    will provide financial accommodation to the Borrower and supersedes any
    previous of extant arrangements with respect to the same.

IN WITNESS whereof the parties have signed this Agreement on the day and year
hereinbefore first mentioned.

SIGNED for and on behalf of
BANK ONE, NA

/s/ William H. Giffen                                /s/ Ralph Mitchell
----------------------------------------             -------------------------
Authorised Signatory (Name/Title)                    Signature
First Vice President

THE COMMON SEAL of                                   )
DAISYTEK AUSTRALIA PTY LTD                           )
was hereunto affixed in the presence of:             )

                                                     /s/ Kathryn Semon
----------------------------------------             -------------------------
Authorised Signatory (Name/Title)                    Signature

----------------------------------------             -------------------------
Authorised Signatory (Name/Title)                    Signature



17
<PAGE>   18
                                   APPENDIX A

FACILITY PRICING: Facility pricing to be determined by the following grid of
                  Total Debt to EBITDA with Total Debt to EBITDA definition to
                  match leverage covenant included in the Term Sheet. Initial
                  pricing shall be set at Level 3. The calculation of ratios is
                  based on the accounts of Daisytek, Inc. as stipulated in the
                  Credit agreement between Daisytek, Inc. and various banks
                  dated December 18, 2000.

                                  PRICING GRID

<TABLE>
<CAPTION>
                           LEVEL 1        LEVEL 2          LEVEL 3          LEVEL 4         LEVEL 5
--------------------------------------------------------------------------------------------------------
<S>                       <C>            <C>             <C>               <C>             <C>
TOTAL DEBT/EBITDA           <1.0         >=1.0<1.50      >=1.50<2.0        >=2.0<2.5       >=2.5<3.0
--------------------------------------------------------------------------------------------------------
FACILITY FEE               20.0 bps       25.0 bps         30.0 bps         37.5 bps        37.5 bps
--------------------------------------------------------------------------------------------------------
ADVANCE MARGIN            130.0 bps      137.5 bps        157.5 bps        175.0 bps       200.0 bps
--------------------------------------------------------------------------------------------------------
ALL-IN "COST              150.0 bps      162.5 bps        187.5 bps        212.5 bps       237.5 bps
--------------------------------------------------------------------------------------------------------
</TABLE>

bps= basis points




18
<PAGE>   19
                                   SCHEDULE I

                             ADVANCE DRAWDOWN NOTICE

TO:        Money Market Desk
           BANK ONE, NA (A.R.B.N. 065 752 918)
           Level 4
           70 Hindmarsh Square
           ADELAIDE  SA  5000

FAX:       08 8223 2948

In accordance with Facility Agreement dated --------------- day of ------------
("the Agreement") DAISYTEK AUSTRALIA PTY LTD (A.C.N. 075 675 795) irrevocably
gives you notice of drawdown under the Facility as follows:

                                     ADVANCE

1.       Date of Drawdown:                             --------------------

2.       Amount of Drawdown:                           $ ------------------
         (currency and amount)

3.       Tenor Required:                               --------------------

4.       Other requests/special conditions (if any)



The Borrower by its execution of this Notice reaffirms and reconstitutes all
representations and warranties or agreements of the Borrower in the Agreement as
if made at the date of this Notice and certifies that no Event of Default (as
defined in the Agreement) has occurred or is continuing or is likely to result
from this transaction.

DATED this                  day of


SIGNED for and on behalf
Daisytek Australia Pty Ltd

---------------------------                      ---------------------------
Authorised Signatory: Name/Title                 Signature

---------------------------                      ---------------------------
Authorised Signatory: Name/Title                 Signature



19