Document:

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EXHIBIT 10.1
                              CONSULTING AGREEMENT

         AGREEMENT dated as of May 1, 2001, by and between NEW VISUAL
ENTERTAINMENT, INC., a Utah corporation (the "Company"), and ADVISOR ASSOCIATES,
INC., a New York corporation (the "Consultant").

                              W I T N E S S E T H:

         WHEREAS, the Company desires to receive the benefit of Consultant's
expertise and knowledge in evaluating financial investments and other matters;

         NOW THEREFORE, in consideration of the mutual covenants and agreements
and upon the terms and subject to the conditions hereinafter set forth, the
parties do hereby covenant and agree as follows:

         1. RETENTION OF CONSULTANT. The Company hereby retains and engages
Consultant, and Consultant accepts such engagement, subject to the terms and
conditions of this Agreement.

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         2. TERM. This Agreement shall be for a term of one (1) year commencing
on the date hereof and ending on April 30, 2002.

         3. CONSULTING SERVICES. During the term hereof, Consultant shall
provide consulting and advisory services in connection with strategic business
planning and related matters (the "Consulting Services"). Consultant shall
solely and exclusively determine the methods, details and means of providing the
Consulting Services hereunder. The parties hereby acknowledge that Consultant
makes no representation or warranty whatsoever that it is a registered
broker-dealer or investment advisor or other similar capacity under applicable
securities laws.

         4. DEVOTION OF TIME. Subject to the provisions hereof, during the term
of this Agreement, Consultant shall devote such of its time and effort as may be
necessary to the discharge of its duties hereunder. The Company acknowledges
that Consultant is engaged in other business activities, and that it will
continue such activities during the term hereof. Notwithstanding anything to the
contrary herein contained, Consultant shall not be restricted from engaging in
other business activities during the term of this Agreement, and Consultant
shall not be required to devote any specified amount of time to the Consulting
Services hereunder.

         5. COMPENSATION. (a) In full consideration for the Consulting Services
hereunder, on the date hereof, the Company shall issue and deliver to Consultant
Common Stock Purchase Warrants for an aggregate of 1,000,000 shares of Common
Stock, par value $0.001per share, of the Company, as follows: (i) 500,000 shares
of Common Stock at an exercise price of $2.50 per share; (ii) 250,000 shares of
Common Stock at an exercise price of $5.00 per share; (iii) 250,000 shares of
Common Stock at an exercise price of $10.00 per share; (collectively, the
"Warrants"). The Warrants shall each provide for an exercise period of five (5)
years and certain registration rights and shall otherwise be in the form of
Exhibit A annexed hereto. The Warrants issued and delivered by the Company to
Consultant hereunder shall be deemed fully earned as of the date hereof, and
shall not be subject to or conditioned upon any event or circumstance
whatsoever.

                                       2
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                  (b) In addition, the Company shall pay and reimburse
Consultant for all reasonable out-of-pocket expenses incurred in connection with
providing the Consulting Services hereunder.

         6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Consultant that:

                  (a) The Company has the full power and authority to execute,
deliver and perform the terms and provisions of this Agreement, including
without limitation, the issuance and delivery of the Warrants and/or Warrant
Shares (as hereinafter defined). This Agreement constitutes the legal, valid and
binding obligation of the Company enforceable in accordance with its terms,
except to the extent that the enforceability hereof may be limited by
bankruptcy, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles (regardless of whether
enforcement is sought in equity or at law).

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                  (b) Neither the execution, delivery or performance by the
Company of this Agreement and the Warrants and/or Warrant Shares, nor compliance
by the Company with the terms and provisions hereof or thereof, will: (i)
materially contravene any provision of any applicable law, statute, rule or
regulation or any order, writ, injunction or decree of any court or governmental
instrumentality; (ii) conflict with or result in any breach of any of the terms,
covenants, conditions or provisions of, or constitute a default under, or result
in the creation or imposition of (or obligation to create or impose) any lien
upon any of the property or assets of the Company pursuant to the terms of, any
indenture, mortgage, deed of trust, credit agreement or loan agreement or any
other agreement, contract or instrument to which the Company is a party or by
which any of its property or assets is bound or may be subject; or (iii) violate
any provision of the Articles of Incorporation or Bylaws (or similar
organizational documents) of the Company.

                  (c) All of the shares of Common Stock issuable to Consultant
upon exercise of the Warrants will be validly issued, fully paid and
non-assessable.

         6A. REPRESENTATIONS AND WARRANTIES OF CONSULTANT. Consultant hereby
represents and warrants to the Company that:

                  (a) Consultant has the full power and authority to execute,
deliver and perform the terms and provisions of this Agreement. This Agreement
constitutes the legal, valid and binding obligation of Consultant enforceable in
accordance with its terms, except to the extent that the enforceability hereof
may be limited by bankruptcy, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
(regardless of whether enforcement is sought in equity or at law).

                                       4
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                  (b) Neither the execution, delivery or performance by
Consultant of this Agreement, nor compliance by Consultant with the terms and
provisions hereof, will: (i) materially contravene any provision of any
applicable law, statute, rule or regulation or any order, writ, injunction or
decree of any court or governmental instrumentality; (ii) conflict with or
result in any breach of any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation or imposition of
(or obligation to create or impose) any lien upon any of the property or assets
of Consultant pursuant to the terms of, any indenture, mortgage, deed of trust,
credit agreement or loan agreement or any other agreement, contract or
instrument to which the Consultant is a party or by which any of its property or
assets is bound or may be subject; or (iii) violate any provision of the
Certificate of Incorporation or Bylaws (or similar organizational documents) of
Consultant.

         7 INVESTMENT REPRESENTATIONS. (a) The Company represents and warrants
that is has provided Consultant access to all information available to the
Company concerning its condition, financial and otherwise, its management, its
business and its prospects. The Company represents that it has provided
Consultant with copies of all of the Company's filings pursuant to the
Securities Act of 1933, as amended (the "1933 Act") and/or the Securities
Exchange Act of 1934, as amended (the "1934 Act"), respectively, and the
regulations promulgated thereunder (collectively, the "Disclosure Documents").
The Company further represents that the Company is current in the filing of the
periodic reports required by the 1934 Act. The provisions of this Section 7
shall survive any termination of this Agreement.

                  (c) Consultant represents and warrants as follows:

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                           (i) Consultant is an "accredited investor," as
                  defined in Regulation D ("Regulation D") promulgated under the
                  Securities Act of 1933, as amended (the "Act")

                           (ii) Consultant is acquiring the Warrants and Warrant
                  Shares for its own account, for investment purposes only, and
                  not with a view to or for the resale, distribution or
                  fractionalization thereof, in whole or in part, and no other
                  person has a direct or indirect beneficial interest in the
                  Warrants or Warrant Shares.

                           (iii) Consultant has the financial ability to bear
                  the economic risk of its investment in the Company (including
                  its possible loss), has adequate means of providing for its
                  current needs and personal contingencies and has no need, and
                  anticipates no need in the foreseeable future for liquidity
                  with respect to its investment in the Company. In addition,
                  Consultant has sufficient net worth to sustain a loss of its
                  entire investment should such a loss occur.

                           (iv) Consultant has such knowledge and experience in
                  financial and business matters as to be capable of evaluating
                  the merits and risks of an investment in the Warrants and
                  Warrant Shares.

                                       6
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                  8. INDEMNIFICATION. (a) The Company hereby agrees to indemnify
and hold harmless Consultant and its directors, officers, employees and/or
affiliates against any and all losses, claims, damages obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements (and all
actions, suits, proceedings and investigations in respect thereof and any and
all reasonable legal or other costs, expenses and disbursements in giving
testimony or furnishing documents in response to a subpoena or otherwise),
including, without limitation, the reasonable costs, expenses, and
disbursements, as and when incurred, of investigating, preparing, or defending
any such action, proceeding or investigation (whether or not in connection with
litigation to which the Consultant is a party) (collectively, the "Liabilities")
arising out of or in connection with the Consulting Services or the willful
misconduct or gross negligence of the Company, or the violation in any material
respect of applicable federal or state securities laws by the Company with
respect to any untrue statement or alleged untrue statement of a material fact
or any omission or alleged omission to state a material fact required to be
stated, or necessary to make the statements made, in light of the circumstances
under which they were made, not misleading; provided, however, that this
provision shall not apply to any Liabilities to the extent found by a court of
competent jurisdiction to have resulted from the willful misconduct, gross
negligence or violation in any material respect of applicable federal or state
securities laws, of Consultant to the extent set forth in Section 8(b) hereof.

                  (b) Consultant hereby agrees to indemnify and hold harmless
the Company and its directors, officers, employees and/or affiliates against any
and all Liabilities arising out of or in connection with the violation in any
material respect of applicable federal or state securities laws by Consultant
arising out of or in connection with the Consulting Services hereunder or with
respect to any untrue statement or alleged untrue statement of a material fact
or any omission or alleged omission to state a material fact required to be
stated, or necessary to make the statements made, in light of the circumstances
under which they were made, not misleading, but only if and to the extent that
such untrue statement or alleged untrue statement of a material fact or the
omission was made in reliance upon information furnished in writing by
Consultant specifically for inclusion in any registration statement, prospectus
or any amendment or supplement thereto in connection with any underwritten
public offering involving the Company; provided, however, that this provision
shall not apply to any Liabilities to the extent found by a court of competent
jurisdiction to have resulted from the willful misconduct, gross negligence or
violation in any material respect of applicable federal or state securities
laws, of the Company to the extent set forth in Section 8(a) hereof.

                                       7
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                  (c) Each party entitled to indemnification under this
Agreement (the "Indemnified Party"), shall give notice to the party required to
provide indemnification hereunder (the "Indemnifying Party") with reasonable
promptness after such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought. Notwithstanding the foregoing, the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 8. Upon receipt of such
notice, the Indemnifying Party shall conduct the defense of such claim or any
litigation resulting therefrom. The Indemnified Party may, however, participate
in such defense at such Indemnified Party's sole expense. The Indemnified Party
shall furnish such information regarding the claim in question as the
Indemnifying Party may reasonably request in writing in connection with the
defense of any such claim and litigation resulting therefrom.

                  (d) The provisions of this Section 8 shall survive any
termination of this Agreement.

                                       8
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         9. INDEPENDENT CONTRACTORS. Nothing herein contained shall be construed
to constitute the parties hereto as partners or as joint venturers, or either as
agent of the other, or as employer or employee. Except as otherwise expressly
provided herein, Consultant acknowledges that it is not an officer, director or
agent of the Company, it is not and will not be responsible for any management
decisions on behalf of the Company, and may not commit the Company to any
action. The Company represents that Consultant does not have, through stock
ownership or otherwise, the power to control the Company, nor to exercise any
dominating influence over its management. Consultant understands and
acknowledges that this Agreement shall not create or imply any agency
relationship between the parties, and Consultant will not commit Company in any
manner except when a commitment has been specifically authorized in writing by
the Company. The parties hereto acknowledge that Consultant shall be engaged
solely on an independent contractor basis hereunder.

         10. MISCELLANEOUS PROVISIONS.

                  (a) GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to principles of conflicts of law. Each of the parties hereby irrevocably
consents to the jurisdiction of the courts of the State of New York and agrees
that service of process may be made in any manner acceptable for use in the
courts of the State of New York.

                  (b) ENTIRE AGREEMENT. This Agreement contains the entire
agreement and understanding between the parties and merges and supersedes any
prior understandings or agreements, whether written or oral. The provisions of
this Agreement shall be amended or waived only with the written consent of both
parties hereto.

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                  (c) SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon, inure to the benefit of, and shall be enforceable by Consultant and the
Company and their respective successors and permitted assigns.

                  (d) NOTICES. All notices and other communications under this
Agreement shall be in writing and shall be deemed effective and given upon
actual delivery, if delivered by hand, or one (1) business day after the date
sent by nationally recognized overnight courier service, email or facsimile
transmission, or five (5) business days after the date sent by registered or
certified mail, return receipt requested, postage prepaid, addressed in each
case, to the following addresses:

                           a.       if to the Company, to:

                                    5920 Friars Road

                                    Suite 104

                                    San Diego, California  92108

                                    Facsimile:  (619) 718-7446

                           b.       if to Consultant, to:

                                    1575 45th Street

                                    Brooklyn New York  11219

                                    Attention: Isaac Winehouse, President

                                    Facsimile: ( 718) 972-8141

                  (e) ASSIGNABILITY. Neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason hereof shall be
assignable by either the Company or Consultant without the prior written consent
of the other party hereto.

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                  (f) SEVERABILITY. If any provision of this Agreement or the
application of any such provision to any person or circumstance shall be held
invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision hereof

                  (g) COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which together shall be deemed to be one and the same
agreement.

                  (h) SPECIFIC PERFORMANCE. The parties hereby acknowledge and
agree that the Warrants and/or Warrant Shares are unique and not otherwise
available, and that, in addition to any other remedies, Consultant may elect, at
its sole option, to invoke any equitable remedies to enforce delivery of the
Warrants and/or Warrant Shares hereunder. In addition, the parties recognize
that, because of the nature of the subject matter of this Agreement, it would be
impracticable and extremely difficult to determine actual damages in the event
of a breach of this Agreement. Accordingly, if the Company commits a breach of
any of the provisions of this Agreement, then the Consultant shall have the
right to seek and receive a temporary restraining order, injunction or other
equitable remedy, including without limitation, the right to have the provisions
of this Agreement specifically enforced by any court having equity jurisdiction.

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         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.

                                    NEW VISUAL ENTERTAINMENT INC.

                                    By:/s/ Ray Willenberg, Jr.
                                       -----------------------------------------
                                    Ray Willenberg, Jr., Chief Executive Officer

                                    ADVISOR ASSOCIATES, INC.

                                    By: /s/ Isaac Winehouse
                                       -----------------------------------------
                                    Issac Winehouse, President<PAGE>

                                                                  EXECUTION COPY

                                                                     Exhibit 4.3

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                               IOS CAPITAL, INC.

                                      TO

                           THE CHASE MANHATTAN BANK,

                                    Trustee
                               _________________

                         SECOND SUPPLEMENTAL INDENTURE

                           Dated as of June 12, 2001

                                    to the

                                   INDENTURE

                           Dated as of June 30, 1995
                               _________________

================================================================================
<PAGE>

     SECOND SUPPLEMENTAL INDENTURE, dated as of June 12, 2001, between IOS
Capital, Inc. (formerly known as "Alco Capital Resource, Inc." and "IKON
Capital, Inc."), a corporation duly organized and existing under the laws of the
State of Delaware (the "Company"), having its principal office at 1738 Bass
Road, Macon, Georgia, and The Chase Manhattan Bank (formerly known as "Chemical
Bank"), a banking corporation duly organized and existing under the laws of the
State of New York, as Trustee (the "Trustee").

                            Recitals of the Company

     The Company has heretofore duly executed and delivered to the Trustee an
Indenture, dated as of June 30, 1995, and the First Supplemental Indenture,
dated as of June 4, 1997 (together, the "Indenture"), providing for the issuance
from time to time of its unsecured debentures, notes, or other evidences of
indebtedness (the "Securities"), to be issued in one or more series.  All
capitalized terms used in this Second Supplemental Indenture and not defined
herein shall have the meanings assigned to them in the Indenture.

     The Company intends to issue $250,000,000 of its 9.750% Notes due 2004 (the
"Notes") under the Indenture.  The Holders of the Notes will be entitled to the
benefit of the additional Events of Default described herein, solely for their
benefit and not for the benefit of any other Holders of Securities.

     Section 901(3) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may enter into one or more supplemental
indentures, in form satisfactory to the Trustee, to add any additional Events of
Default solely for the benefit of the Holders of the Notes.

     All things necessary to make this Second Supplemental Indenture a valid
agreement of the Company, and a valid supplement to the Indenture, have been
done.

     Now, Therefore, this Second Supplemental Indenture Witnesseth:

     For and in consideration of the premises, it is mutually agreed, solely for
the benefit of the Holders of the Notes, as follows:
<PAGE>

     1.   The following definitions are hereby added to Section 101 of the
Indenture:

     "Consolidated Net Worth" shall be determined in accordance with GAAP and
shall mean the sum (as reflected in the consolidated balance sheet of IKON and
its Consolidated Subsidiaries) of (i) the stated dollar amount of outstanding
capital stock plus, (ii) the stated dollar amount of additional paid in capital,
if any, plus (iii) the amount of surplus and retained earnings minus, (iv) the
cost of treasury shares and the excess of redemption value over the stated value
of preferred stock of IKON and its Consolidated Subsidiaries.

     "Consolidated Subsidiary" means any corporation of which IKON directly or
indirectly owns or controls at least a majority of the outstanding stock having
general voting power, including without limitation the right, under ordinary
circumstances, to vote for the election of a majority of the Board or Directors
of such corporation.

     "Finance Leasing Subsidiary" means the Company, IKON Capital Inc., a
Canadian corporation, IKON Capital, PLC, a British company, IKON Office
Solutions Dublin Limited, an Irish company, IKON Leasing GmbH, a German company,
any successors to such corporations, and such additional subsidiaries whose
primary business is the leasing of products distributed by IKON and its
subsidiaries.

     "Fixed Charges Coverage Ratio" means the ratio of (x) consolidated
operating income, excluding non-recurring charges, plus one-third of rental
expenses relating to operating leases to (y) fixed charges.  Fixed charges
include (i) interest costs, both expensed and capitalized, excluding interests
costs of Finance Leasing Subsidiaries, (ii) amortization of debt expense and
discount or premium relating to any indebtedness, whether expensed or
capitalized, plus (iii) one-third of rental expense relating to operating
leases.

     "GAAP" means generally accepted accounting principles in the United States
of America as in effect from time to time.

     "IKON" means IKON Office Solutions, Inc., the successor corporation to Alco
Standard Corporation, and its successors.

     "Second Supplemental Indenture" means this Second Supplemental Indenture,
dated as of June 12, 2001, among the Company and the Trustee.

                                      -2-
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     "Securitization" means with respect to IKON and its Consolidated
Subsidiaries the transfer or pledge of assets or interests in assets to a trust,
partnership, corporation or other entity, which transfer or pledge is funded by
such entity in whole or in part by the issuance of instruments or securities
that are paid principally from the cash flow derived from such assets or
interests in assets.

     "SFAS" means the Statement on Financial Accounting Standards issued by the
American Institute of Certified Public Accountants from time to time."

     2.   The following Section 501A is hereby added to the Indenture:

"Section 501A.  Additional Events of Default Solely for the Benefit of the
Holders of the 9.750% Notes due 2004.

     "Event of Default", wherever used herein with respect to the 9.750% Notes
due 2004 (for purposes of this Section 501A, the "Notes") means, in addition to
the Events of Default listed in Section 501, any one of the following events, if
such event occurs and is continuing for a period of 60 days after written notice
thereof is given to the Company by the Trustee under the Indenture or to the
Company and the Trustee by the holders of an aggregate of at least 10% in
principal amount of the Notes:

     (1)  IKON or any Consolidated Subsidiary creates or assumes any
indebtedness secured by any mortgage, pledge, security interest, encumbrance, or
other lien upon any property, now owned or hereafter acquired, of IKON or any
Consolidated Subsidiary (the sale with recourse of receivables or any sale and
lease-back of any fixed assets being deemed to be the giving of a lien thereon
for money borrowed), other than debt secured by:

          (A) liens existing on the date of the Second Supplemental Indenture on
     any property, provided that the amount secured by any such lien is not
     greater than the amount secured thereby on such date;

          (B) liens on any property (including but not limited to margin stock
     (within the meaning of Regulations T, U, and X of the Board of Governors of
     the Federal Reserve System)) acquired after the date of the Second
     Supplemental Indenture existing at the time of such acquisition or created
     within a period of 120 days following any such acquisition to secure or
     provide for the payment of any part of the purchase

                                      -3-
<PAGE>

     price thereof or liens to secure debt incurred to fund or refund any liens
     within the scope of this subsection (B), provided that the amount secured
     by any such lien is not greater than the amount secured thereby on the date
     of such acquisition or within the 120 day period, as the case may be;

          (C) liens securing debt of a Consolidated Subsidiary outstanding on
     the date that IKON acquires such Consolidated Subsidiary;

          (D) liens for taxes, assessments, or governmental charges or levies
     not yet due and payable or being contested in good faith and by appropriate
     proceedings promptly initiated and diligently conducted, provided that a
     reserve or other appropriate provision, if any, as shall be required by
     GAAP shall have been made therefor and no foreclosure, distraint, sale, or
     other similar proceedings shall have been commenced;

          (E) statutory liens of landlords and liens of carriers, warehousemen,
     mechanics, and materialmen incurred in the ordinary course of business for
     sums not yet due or being contested in good faith by appropriate
     proceedings promptly initiated and diligently conducted, provided that a
     reserve or other appropriate provision, if any, as shall be required by
     GAAP shall have been made therefor;

          (F) liens incurred or deposits made in the ordinary course of business
     in connection with workmen's compensation, unemployment insurance, and
     other types of social security or to secure the performance of tenders,
     statutory obligations, surety and appeal bonds, performance and return-of-
     money bonds, and other similar obligations (exclusive of obligations for
     the payment of borrowed money);

          (G) liens created hereafter in connection with borrowing or pledges of
     receivables, which liens when added to all sales and discounting
     transactions contemplated by Section 501A(6) do not in the aggregate exceed
     10% of Consolidated Net Worth;

          (H) liens, security interests, and any other encumbrances on any of
     its treasury shares; and

          (I) liens arising in connection with a Securitization permitted by
     Section 501A(6) hereof, limited in each case to the accounts therein or in
     any trust or similar entity utilized to effect such

                                      -4-
<PAGE>

     Securitizations and to any equipment giving rise to such accounts.

     (2)  The total debt of IKON and its Consolidated Subsidiaries is equal to
or greater than 60% of the sum of (i) the total debt of IKON and its
Consolidated Subsidiaries plus (ii) the consolidated minority interest
obligations shown on the consolidated balance sheet of IKON and its Consolidated
Subsidiaries plus, (iii) the Consolidated Net Worth of IKON and its Consolidated
Subsidiaries. For purposes of calculating such ratio (x) Finance Leasing
Subsidiaries shall be excluded from the definition of "Consolidated
Subsidiaries", (y) any adjustments resulting from the application of SFAS 133
shall be excluded from shareholder's equity, and (z) in calculating the
Consolidated Net Worth of IKON and its Consolidated Subsidiaries, non-recurring
charges subsequent to June 30, 2001, shall be added back.

     (3)  For any period of four consecutive fiscal quarters ending during the
period set forth below, the Fixed Charges Coverage Ratio of IKON is less than
the ratio set forth below opposite such period:

          Period                        Ratio
          ------                        -----
     June 30, 2001 to June 29, 2002     1.50 to 1.00
     June 30, 2002 to June 29, 2003     1.75 to 1.00
     June 30, 2003 and thereafter       2.00 to 1.00.

     (4)  Any Consolidated Subsidiary directly or indirectly creates, assumes,
guarantees or otherwise becomes liable with respect to any debt (other than
Excluded Debt, as defined below) in an aggregate amount outstanding (as to all
Consolidated Subsidiaries) at any time in excess of 12.5% of Consolidated Net
Worth plus the amount of debt outstanding on the date of the Second Supplemental
Indenture (other than Excluded Debt outstanding on such date).

          For the purpose of this Section 501A(4), "Excluded Debt" shall mean:
(i) debt owing exclusively to IKON or a Consolidated Subsidiary, (ii) debt of a
Consolidated Subsidiary outstanding on the date that IKON acquires such
Consolidated Subsidiary, (iii) debt with respect to property to be used by IKON
or a Consolidated Subsidiary, the interest on which debt is exempt from Federal
income tax pursuant to (S)103 of the Internal Revenue Code of 1986, as amended,
(iv) debt of any foreign subsidiary that is not guaranteed by IKON or any other
Consolidated Subsidiary, (v) debt of Finance Leasing Subsidiaries owing to IKON
or any Consolidated Subsidiary, (vi) debt of Finance Leasing Subsidiaries to a
Person or Persons other than IKON or a

                                      -5-
<PAGE>

Consolidated Subsidiary provided that such debt is not guaranteed by IKON or a
Consolidated Subsidiary, or (vii) the Notes or debt existing or incurred under
a facility existing as of the date of the Second Supplemental Indenture or any
facility or facilities replacing such existing facility.

     (5)  IKON or a Consolidated Subsidiary, sells, leases or transfers all or
substantially all of its assets unless (i) immediately after giving effect
thereto the Company is in compliance with the covenants and provisions of the
Indenture (including this Section 501A) and (ii) such sale, lease, or transfer
shall not have any materially adverse effect upon the financial condition of
IKON and its Consolidated Subsidiaries taken as a whole.  Notwithstanding this
provision, any Consolidated Subsidiary may sell, lease, or transfer all or
substantially all its assets to IKON or any other Consolidated Subsidiary.

     (6)  IKON or any Consolidated Subsidiary, with the exception of the Finance
Leasing Subsidiaries, enters into any securitizations, or sells or discounts
receivables with recourse or sell and lease back fixed assets the aggregate
amount of which when added to all liens permitted by Subsection 501A(1)(G)
exceed 10% of Consolidated Net Worth.

     (7)  IKON:

          (i)   declares or pays any dividends (other than dividends payable
     solely in common stock);

          (ii)  makes other distributions on any class of capital stock; or

          (iii) acquires or permits any Consolidated Subsidiary to acquire
     shares of capital stock of IKON

if, after giving effect thereto, the sum of all payments would exceed:

          (a) 75% of consolidated net income (or 100% of consolidated net loss)
     of IKON and its Consolidated Subsidiaries since March 31, 2001, plus

          (b) net cash proceeds derived from issues of stock since March 31,
     2001, plus

          (c) the aggregate principal amount of debt subsequently converted into
     stock since March 31, 2001, plus

          (d) $50 million.

Notwithstanding the foregoing the IKON may:

                                      -6-
<PAGE>

          (x) pay dividends or make mandatory sinking funds payments on any
     preferred stock; and

          (y) pay any dividend on common stock within 90 days after declaration
     if such payment would have been permitted at the date of declaration.

     (8) IKON or any Consolidated Subsidiary enters into directly or indirectly
any transaction (including without limitation the purchase, lease, sale or
exchange of properties of any kind or the rendering of any service) with any
Affiliate (other than IKON or a Consolidated Subsidiary), except in the ordinary
course and pursuant to the reasonable requirements of IKON's or such
Consolidated Subsidiary's business and upon fair and reasonable terms no less
favorable to IKON or such Consolidated Subsidiary than would be obtainable in a
comparable arm's-length transaction with a Person not an Affiliate."

     3.  The Trustee shall have no responsibility to take any action with
respect to an Event of Default under Section 501A(5)(ii) of the Indenture, as
amended hereby, unless and until it shall have received a direction from the
Holders of a majority in principal amount of the Outstanding Notes pursuant to
Section 512 of the Indenture to take action with respect to such Event of
Default, accompanied by a letter from an investment banking firm of national
reputation to the effect that an Event of Default under Section 501A(5)(ii) of
the Indenture, as amended hereby, has occurred and is continuing.

     4.  This Second Supplemental Indenture shall be construed in accordance
with the laws of the State of New York without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.

     5.  The Trustee shall not be responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this Second Supplemental Indenture or
for or in respect of the recitals contained herein, all of which recitals are
made solely by the Company.

                                      -7-
<PAGE>

     This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.

     In Witness Whereof, the parties hereto have caused this Second Supplemental
Indenture to be duly executed as of the day and year first above written.

                         IOS Capital, Inc.

                           By /s/ J. F. Quinn
                              ------------------------

                         The Chase Manhattan Bank, as Trustee

                           By /s/ Wanda Eiland
                              ------------------------

                                      -8-

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