DAISYTEK INTERNATIONAL CORPORATION /DE/
GUARANTY, DATED MARCH 25, 2002
<DOCUMENT>
<TYPE>EX-10.26
<SEQUENCE>9
<FILENAME>d97974exv10w26.txt
<DESCRIPTION>GUARANTY, DATED MARCH 25, 2002
<TEXT>
<PAGE>
                                                                   EXHIBIT 10.26

                                GUARANTY OF LEASE

      THIS GUARANTY OF LEASE ("GUARANTY") is made as of this 25th day of March,
2002 by DAISYTEK INTERNATIONAL CORPORATION, a Delaware corporation ("GUARANTOR")
in favor of TEJON DERMODY INDUSTRIAL LLC, a Delaware limited liability company
("LANDLORD") in connection with that certain Standard Industrial Lease (Net -
Net - Net) of substantially even date herewith (the "LEASE"), pursuant to which
Landlord leases to Daisytek, Incorporated, a Delaware corporation ("TENANT"), an
approximately 325,954 rentable square foot portion (the "PREMISES") of the
larger approximately 651,909 rentable square foot building ("BUILDING"), with a
street address of 4049 Industrial Parkway, located in the project commonly known
as "Tejon Industrial Complex" in the County of Kern, California, as more
particularly described in the Lease.

      A. Landlord requires this Guaranty as a condition to its execution of the
Lease and the performance of the obligations to be performed under the Lease by
Landlord.

      B. Tenant is a wholly-owned subsidiary of Guarantor. Guarantor has agreed
to provide this Guaranty to induce Landlord to enter into the Lease with Tenant
and perform its obligations under the Lease.

      In consideration of Landlord's agreement to execute the Lease and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Guarantor does hereby agree with Landlord as follows:

      1. The Lease is hereby incorporated into and made a part of this Guaranty
by this reference.

      2. Guarantor hereby absolutely, irrevocably and unconditionally
guarantees, as a primary obligor and not as a surety, without deduction by
reason of setoff, defense or counterclaim, the full and punctual payment of all
sums of rent and other amounts payable under the Lease and the full and punctual
performance of all terms, covenants and conditions in the Lease to be kept,
performed and/or observed by Tenant. Guarantor's obligations under this Guaranty
are continuing and unconditional and shall terminate only upon full and complete
payment and performance of all guaranteed obligations.

      3. Guarantor hereby agrees that, without the consent or demand of or
notice to Guarantor and without affecting any of the obligations of Guarantor
hereunder: (a) the Lease may be extended and any other term, covenant or
condition of the Lease may be amended, compromised, released or otherwise
altered by Landlord and Tenant, and Guarantor does guarantee and promise to
perform all of the obligations of Tenant under the Lease as so extended,
amended, compromised, released or altered; (b) any guarantor of or party to the
Lease may be released, substituted or added; (c) any right or remedy under the
Lease may be exercised, not exercised, impaired, modified, limited, destroyed,
or suspended; (d) Landlord or any other person may deal in any manner with
Tenant, any guarantor, any party to the Lease or any other person; (e) Landlord
may permit Tenant to holdover the Premises beyond the Lease Term; and
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(f) all or any part of the Premises or of Tenant's rights or liabilities under
the Lease may be sublet, assigned or assumed. Notwithstanding any of the
foregoing actions, Guarantor shall be and remain bound by the obligations set
forth in this Guaranty. Without in any way limiting the foregoing, Guarantor
agrees not to unreasonably withhold its consent to any sublease, assignment of
the Lease or other modification of the Lease which is agreed to by Landlord and
Tenant.

      4. The obligations of Guarantor under this Guaranty are independent of the
obligations of Tenant and Guarantor hereby knowingly and voluntarily waives and
agrees not to assert or take advantage of: (a) any right to require Landlord to
proceed against Tenant, or any other guarantor or person or to pursue any other
security or remedy before proceeding against Guarantor; (b) any defense based on
the genuineness, validity, regularity or enforceability of the Lease; (c) any
right or defense that may arise by reason of the incapacity, lack of authority,
death or disability of Tenant or any other person; and (d) any right or defense
arising by reason of the absence, impairment, modification, limitation,
destruction or cessation (in bankruptcy, by an election of remedies, or
otherwise) of the liability of Tenant, of the subrogation rights of Guarantor or
of the right of Guarantor to proceed against Tenant for reimbursement. Without
limiting the generality of the foregoing, Guarantor hereby waives any and all
benefits of the provisions of Sections 2809, 2810 and 2845 of the California
Civil Code and any similar or analogous statutes of California or any other
jurisdiction.

      5. Guarantor hereby knowingly and voluntarily waives and agrees not to
assert or take advantage of (a) any right or defense based on the absence of any
or all presentments, demands (including demands for performance), notices
(including notices of any adverse change in the financial status of Tenant,
notices of any other facts which increase the risk to Guarantor, notices of
non-performance and notices of acceptance of this Guaranty) and protests of each
and every kind; (b) the defense of any statute of limitations in any action
under or related to this Guaranty or the Lease; (c) any right or defense based
on a lack of diligence or failure or delay by Landlord in enforcing its rights
under this Guaranty or the Lease. In addition to the foregoing, Guarantor
acknowledges and agrees that any partial payment or performance by Tenant or
otherwise or other circumstance which operates to toll any statute of
limitations as to Tenant shall operate to toll the statute of limitations as to
Guarantor.

      6. Guarantor hereby knowingly and voluntarily waives and agrees not to
assert or take advantage of any right to (a) exoneration if Landlord's actions
shall impair any security or collateral of Guarantor; (b) any security or
collateral held by Landlord; (c) require Landlord to proceed against or exhaust
any security or collateral before proceeding against Guarantor; (d) require
Landlord to pursue any right or remedy for the benefit of Guarantor; or (e) any
law providing that the obligations of a guarantor must not be larger in amount
nor in other respects more burdensome than that of the principal or which
reduces a guarantor's obligation in proportion to the principal obligation.
Without limiting the generality of the foregoing, Guarantor hereby waives any
and all benefits of the provisions of Sections 2819, 2822, 2849 and 2850 of the
California Civil Code and any similar or analogous statutes of California or any
other jurisdiction.

      7. Guarantor shall not, without the prior written consent of Landlord,
commence, or join with any other person in commencing, any bankruptcy,
reorganization or insolvency


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<PAGE>
proceeding against Tenant. Guarantor's obligations under this Guaranty shall in
no way be affected by any bankruptcy, reorganization or insolvency of Tenant or
any successor or assignee of Tenant or by any disaffirmance or abandonment of
the Lease or any payment under this Guaranty by a trustee of Tenant in any
bankruptcy proceeding including, without limitation, any impairment, limitation,
or modification of the liability of Tenant or the estate of Tenant in
bankruptcy, or of any remedy for the enforcement of Tenant's liability under the
Lease resulting from the operation of any present or future provision of any
federal or state bankruptcy or insolvency law or other statute or from the
decision of any court. Guarantor shall file in any bankruptcy or other
proceeding in which the filing of claims is required or permitted by law all
claims which Guarantor may have against Tenant relating to any indebtedness of
Tenant to Guarantor and will assign to Landlord all rights of Guarantor
thereunder until all Lease obligations are paid in full. Landlord shall have the
sole right to accept or reject any plan proposed in such proceeding and to take
any other action that a party filing a claim is entitled to do relating to any
indebtedness of Tenant to Landlord under the Lease. In all such cases, whether
in administration, bankruptcy or otherwise, the person or persons authorized to
pay such claim shall pay to Landlord the amount payable on such claim and, to
the full extent necessary for that purpose, Guarantor hereby assigns to Landlord
all of Guarantor's rights to any such payments or distributions to which
Guarantor would otherwise be entitled; provided, however, that Guarantor's
obligations hereunder shall not be satisfied except to the extent that Landlord
receives cash by reason of any such payment or distribution. If Landlord
receives anything hereunder other than cash, the same shall be held as
collateral for amounts due under this Guaranty. In the event any payment by
Tenant to Landlord is held to constitute a preference, fraudulent conveyance or
otherwise required to be returned by Landlord, such payment by Tenant to
Landlord shall not in any way diminish Guarantor's obligations hereunder and
this Guaranty shall continue to be effective. If the aggregate amount so paid is
greater than the guaranteed obligations then outstanding, and after taking into
account any payments theretofore made to and actually received by Landlord from
Guarantor, Landlord will pay the amount of the excess to the party or parties
entitled thereto.

      8. Until all the Tenant's obligations under the Lease are fully performed,
Guarantor: (a) shall have no right of subrogation, contribution or reimbursement
against the Tenant by reason of any payments or acts of performance by Guarantor
under this Guaranty; (b) subordinates any liability or indebtedness of the
Tenant now or hereafter held by Guarantor to the obligations of the Tenant
under, arising out of or related to the Lease or Tenant's use of the Premises;
and (c) acknowledges that the actions of Landlord may affect or eliminate any
rights of subrogation, contribution or reimbursement of Guarantor as against
Tenant without any liability or recourse against Landlord. Without limiting the
generality of the foregoing, Guarantor hereby waives any and all benefits of the
provisions of Section 2848 of the California Civil Code and any similar or
analogous statutes of California or any other jurisdiction.

      9. Prior to the execution of this Guaranty and at any time during the Term
of the Lease upon ten (10) days prior written notice from Landlord, Guarantor
agrees to provide Landlord with an annual financial statement of Guarantor for
each year. Guarantor's financial statements are to be prepared in accordance
with generally accepted accounting principles and, if such is the normal
practice of Guarantor, audited by an independent certified public accountant.
Guarantor represents and warrants that all such financial statements shall be
true and correct


                                      -3-
<PAGE>
statements of Guarantor's financial condition and an officer of Guarantor shall
certify in writing to Landlord to that effect.

      10. The liability of Guarantor and all rights, powers and remedies of
Landlord hereunder and under any other agreement now or at any time hereafter in
force between Landlord and Guarantor relating to the Lease shall be cumulative
and not alternative and such rights, powers and remedies shall be in addition to
all rights, powers and remedies given to Landlord by law.

      11. Subject to the limitations hereinafter set forth, this Guaranty
applies to, inures to the benefit of and binds all parties hereto, their heirs,
devisees, legatees, executors, administrators, representatives, successors and
assigns. This Guaranty may be assigned by Landlord voluntarily or by operation
of law. Guarantor may not assign, delegate or otherwise transfer all or any part
of its rights and obligations under this Guaranty without the express prior
written consent of Landlord, which consent may be withheld in Landlord's sole
and absolute discretion, it being understood that Landlord is relying upon the
financial strength and integrity of Guarantor in this transaction.

      12. This Guaranty shall constitute the entire agreement between Guarantor
and the Landlord with respect to the subject matter hereof. No provision of this
Guaranty or right of Landlord hereunder may be waived nor may any guarantor be
released from any obligation hereunder except by a writing duly executed by an
authorized officer, director or trustee of Landlord. The waiver or failure to
enforce any provision of this Guaranty shall not operate as a waiver of any
other breach of such provision or any other provisions hereof. No course of
dealing between Landlord and Tenant shall alter or affect the enforceability of
this Guaranty or Guarantor's obligations hereunder.

      13. In giving this Guaranty, Guarantor has independently investigated, to
the extent deemed necessary by Guarantor, Tenant's financial condition and
hereby knowingly and irrevocably waive any right Guarantor may possess to
require Landlord to disclose to Guarantor any information Landlord may now or
hereafter possess concerning Tenant's present or future character, credit,
collateral or financial condition. Guarantor assumes the responsibility for
being and keeping informed of the financial condition of Tenant and of all
circumstances bearing upon the risk of non-payment and nonperformance of the
guaranteed obligations which diligent inquiry would reveal.

      14. The term "Landlord" whenever hereinabove used refers to and means the
Landlord in the foregoing Lease specifically named and also any assignee of said
Landlord, whether by outright assignment or by assignment for security, and also
any successor to the interest of said Landlord or of any assignee of such Lease
or any part thereof, whether by assignment or otherwise. The term "Tenant"
whenever hereinabove used refers to and means the Tenant in the foregoing Lease
specifically named and also any assignee or subtenant of said Lease and also any
successor to the interests of said Tenant, assignee or sublessee of such Lease
or any part thereof, whether by assignment, sublease or otherwise including,
without limitation, any trustee in bankruptcy and any bankruptcy estate of
Tenant, Tenant's assignee or sublessee.


                                      -4-
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      15. If Guarantor shall become bankrupt or insolvent, or any application
shall be made to have Guarantor declared bankrupt or insolvent, or Guarantor
shall make an assignment for the benefit of creditors, or Guarantor shall enter
into a proceeding for the dissolution of marriage, or in the event of death of
Guarantor, notice of such occurrence or event shall be promptly furnished to
Landlord by such Guarantor or Guarantor's fiduciary. This Guaranty shall extend
to and be binding upon each Guarantor's legal heirs and representatives, and
successors and assigns, including, but not limited to, trustees in bankruptcy
and Guarantor's estate.

      16. Any notice, request, demand, instruction or other communication to be
given to any party hereunder shall be in writing and sent by registered or
certified mail, return receipt requested in accordance with the notice
provisions of the Lease. The Tenant shall be deemed Guarantor's agent for
service of process and notice to Guarantor delivered to the Tenant at the
address set forth in the Lease shall constitute proper notice to Guarantor for
all purposes. Notices to Landlord shall be delivered to Landlord's address set
forth in the Lease. Landlord, at its election, may provide an additional notice
to Guarantor at the address provided under Guarantor's signature below.

      17. If either party hereto participates in an action against the other
party arising out of or in connection with this Guaranty, the prevailing party
shall be entitled to have and recover from the other party reasonable attorneys'
fees, collection costs and other costs incurred in and in preparation for the
action. In addition to the foregoing, Guarantor shall be responsible for any
attorneys' fees, collection costs and other costs of Tenant arising out of any
dispute under the Lease, including, without limitation, all interest, default
interest, post-petition bankruptcy interest and other post-petition obligations,
late charges, court costs and attorneys' fees, which may be suffered or incurred
by Landlord in enforcing or compromising any rights under this Guaranty or in
enforcing or compromising the performance of Tenant's obligations under the
Lease. Guarantor hereby waives any right to trial by jury and further waives and
agrees not to assert or take advantage of any defense based on any claim that
any arbitration decision binding upon Landlord and Tenant is not binding upon
Guarantor.

      18. Guarantor represents and warrants to Landlord that: (a) this Guaranty
has been duly executed and delivered to Landlord by Guarantor; (b) this Guaranty
is a valid and legally binding obligation of Guarantor, enforceable in
accordance with its terms, except as such validity, binding nature or
enforceability may be limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium or other laws or court decisions relating to or
affecting the rights of creditors generally; (c) Guarantor has received a true,
correct and complete copy of and is fully familiar with the Lease and represents
and warrants that to the best of Guarantor's knowledge, all necessary action has
been taken by Tenant to authorize Tenant's execution and delivery of the Lease;
and (d) Tenant is under no disability in connection with its execution and
delivery of the Lease and there are no defenses to Tenant's full payment and
performance of all of its obligations under the Lease. Within ten (10) days
following Landlord's request, Guarantor shall deliver to Landlord an estoppel
certificate certifying, among other things, that this Guaranty is in full force
and effect and has not been amended or terminated.

      19. Guarantor agrees that all questions, actions and disputes with respect
to this Guaranty or the performance or enforcement thereof shall be governed by,
and decided in


                                      -5-
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accordance with, the laws of the State of California, and venue shall be set in
any federal or state court located in Kern County, California.

      20. Should any one or more provisions of this Guaranty be determined to be
illegal or unenforceable, all other provisions shall nevertheless be effective.

      21. Time is strictly of the essence under this Guaranty and any amendment,
modification or revision hereof.

      22. If Guarantor is a corporation, each individual executing this Guaranty
on behalf of said corporation represents and warrants that he is duly authorized
to execute and deliver this Guaranty on behalf of said corporation, in
accordance with a duly adopted resolution of the Board of Directors of said
corporation or in accordance with the by-laws of said corporation, and that this
Guaranty is binding upon said corporation in accordance with its terms. If
Guarantor is a corporation, Landlord, at its option, may require Guarantor to
concurrently, with the execution of this Guaranty, deliver to Landlord a
certified copy of a resolution of the Board of Directors of said corporation
authorizing or ratifying the execution of this Guaranty. If Guarantor is another
form of entity, each individual executing this Guaranty on behalf of said entity
represents and warrants that he or she is duly authorized to execute and deliver
this Guaranty on behalf of said entity in accordance with the governing and/or
formation documents of said entity.

      23. If more than one party executes a Guaranty of Lease guaranteeing
Tenant's obligations under the Lease, then each party's obligations shall be
joint and several.

      THE UNDERSIGNED HAS READ AND UNDERSTANDS THE TERMS AND CONDITIONS
CONTAINED IN THIS GUARANTY INCLUDING, WITHOUT LIMITATION, ALL WAIVERS CONTAINED
IN THIS GUARANTY.

      Executed as of the date of the Lease.

                                    DAISYTEK INTERNATIONAL CORPORATION,
                                    a Delaware corporation


                                    By:     /S/ MICHAEL BISHOFF
                                       ---------------------------------------
                                       Name:  Michael Bishoff
                                       Title:  VP - Distribution


                                    By:     /S/ GEORGE MANEY
                                       ---------------------------------------
                                       Name:  George Maney
                                       Title:  SVP - Operations

Address of Guarantor:

Daisytek International Corporation
1025 Central Expressway, South


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<PAGE>
Allen, Texas  75013
Attn: Michael Bishoff

*NOTE:

IF TENANT IS A CALIFORNIA CORPORATION, then one of the following alternative
requirements must be satisfied:

(A)   This Lease must be signed by two (2) officers of such corporation: one
      being the chairman of the board, the president or a vice president, and
      the other being the secretary, an assistant secretary, the chief financial
      officer or an assistant treasurer. If one (1) individual is signing in two
      (2) of the foregoing capacities, that individual must sign twice; once as
      one officer and again as the other officer.

(B)   If there is only one (1) individual signing in two (2) capacities, or if
      the two (2) signatories do not satisfy the requirements of (A) above, then
      Tenant shall deliver to Landlord a certified copy of a corporate
      resolution in a form reasonably acceptable to Landlord authorizing the
      signatory(ies) to execute this Lease.

IF TENANT IS A CORPORATION INCORPORATED IN A STATE OTHER THAN CALIFORNIA, then
Tenant shall deliver to Landlord a certified copy of a corporate resolution in a
form reasonably acceptable to Landlord authorizing the signatory(ies) to execute
this Lease.

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