SECOND PROSPECTUS SUPPLEMENT
(to Prospectus dated January 15, 1997)
Filed Pursuant to Rules 424(b)(3) and (c)
Registration Nos. 333-16307 and 333-16307-01
4,025,000 Trust Convertible Preferred Securities
VANSTAR FINANCING TRUST
6% Trust Convertible Preferred Securities
(Liquidation Amount $50 per Preferred Security)
guaranteed by, and convertible into Common Stock of,
VANSTAR CORPORATION
This Second Prospectus Supplement supplements and amends the
Prospectus dated January 15, 1997 as supplemented and amended by
that First Prospectus Supplement dated February 6, 1997
(collectively, the "Prospectus") relating to the 6% Trust
Convertible Preferred Securities (the "Preferred Securities")
which represent preferred undivided beneficial ownership
interests in the assets of Vanstar Financing Trust, a statutory
business trust formed under the laws of the State of Delaware,
and the shares of common stock, par value $.001 per share (the
"Company Common Stock"), of Vanstar Corporation, a Delaware
corporation, issuable upon conversion of the Preferred
Securities. All capitalized terms used but not otherwise defined
in this Second Prospectus Supplement shall have the meanings
ascribed thereto in the Prospectus.
Following their original issuance by the Trust, the
Preferred Securities have been resold by the Initial Purchasers
and subsequent purchasers thereof to qualified institutional
buyers in transactions exempt from registration under Rule 144A
promulgated under the Securities Act. The Preferred Securities
have been and will remain eligible for resale on the PORTAL
Market. However, Preferred Securities resold pursuant to this
Prospectus will no longer be eligible for trading on the PORTAL
Market. The Company and the Trust do not currently intend to list
the Preferred Securities resold pursuant to this Prospectus on
any securities exchange or to seek approval for quotation through
any automated quotation system. Accordingly, there can be no
assurance as to the development or liquidity of any market for
the Preferred Securities resold under this Prospectus. See "Risk
Factors - Absence of Public Market for the Preferred Securities
on Resale" in the Prospectus.
Neither the Company nor the Trust will receive any of the
proceeds from the sale of the Preferred Securities by the Selling
Holders. Expenses of preparing and filing the Registration
Statement, the Prospectus, this Second Prospectus Supplement and
all other prospectus supplements are borne by the Company.
The Prospectus, together with this Second Prospectus
Supplement, constitutes the prospectus required to be delivered
by Section 5(b) of the Securities Act with respect to offers and
sales of the Preferred Securities and the Company Common Stock
issuable upon conversion of the Preferred Securities. All
references in the Prospectus to "this Prospectus" are hereby
amended to read "this Prospectus (as supplemented and amended)".
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" BEGINNING ON PAGE 13 OF THE PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus Supplement is February 27, 1997.
<PAGE>
The Prospectus is hereby amended to modify the "Selling
Holders" table located therein to add the following information
to the end thereof.
The table below sets forth information as of February 27,
1997 concerning beneficial ownership of the Preferred Securities
of each of the Selling Holders therein listed. All information
concerning beneficial ownership has been furnished by the Selling
Holders.
<TABLE>
<CAPTION>
No of Preferred
Preferred Securities Securities
Owned Before Offering Offered in the
Name of Selling Holder(1) Number Percent(2) Offering
------------------------- ------ ---------- ----------------
<S> <C> <C> <C> <C>
47. Robertson, Stephens & Co. LLP(3) 48,450 1.2 48,450
48. Donaldson, Lufkin & Jenrette
Securities Corporation(4) 20,000 * 20,000
49. ICI American Holdings Pension 5,500 * 5,500
50. Zeneca Holdings Pension 5,500 * 5,500
51. State of Delaware Retirement Fund
- Froley, Revy 13,000 * 13,000
52. PRIM Board 20,000 * 20,000
53. Starvest Discretionary 3,500 * 3,500
54. Oregon Equity Fund 36,200 * 36,200
55. Allstate Insurance Company 35,000 * 35,000
56. Lazard Freres & Co. LLC 40,500 1.0 40,500
57. Putnam Voyager Fund 27,100 * 27,100
58. Putnam Convertible Income-Growth
Trust 168,000 4.2 168,000
59. Putnam Balanced Retirement Fund 10,300 * 10,300
60. Putnam Variable Trust - Putnam VT
Voyager Fund 6,700 * 6,700
61. Putnam Variable Trust - Putnam New
Opportunities Fund 9,000 * 9,000
62. Museum of Fine Arts, Boston 3,000 * 3,000
63. Boston College Endowment 7,000 * 7,000
64. Promutual 15,500 * 15,500
65. Hartford Fire Insurance Company 15,000 * 15,000
66. Employers' Reinsurance Corporation 20,000 * 20,000
67. Putnam Convertible Opportunities and
Income Trust 13,450 * 13,450
68. New Hampshire State Retirement
System 18,500 * 18,500
69. Putnam New Opportunities Fund 66,800 1.7 66,800
--------- ---- ---------
TOTAL (5) 2,586,750 64.3 2,586,750
========= ==== =========
</TABLE>
____________________
* Represents less than one percent.
(1) Information concerning Selling Holders numbered 1 through 46
is included in the First Prospectus Supplement dated
February 6, 1997 (the "First Prospectus Supplement").
(2) Percentage indicated is based upon 4,025,000 Preferred
Securities outstanding on February 26, 1997.
(3) Represents additional Preferred Securities not listed in the
First Prospectus Supplement. Robertson, Stephens & Company
LLC, an affiliate of Robertson, Stephens & Co. LLP
("Robertson, Stephens"), has in the past provided to the
Company and/or its affiliates investment banking and/or
investment advisory services including (i) acting as lead
Initial Purchaser in the Original Offering and the Over-
Allotment Offering and (ii) acting as lead underwriter in
the Company's initial public offering occurring March 11,
1996 (the "IPO"). In each case, Robertson, Stephens has
received only customary fees in connection with the
provision of such services.
(4) Represents additional Preferred Securities not listed in the
First Prospectus Supplement. Donaldson, Lufkin & Jenrette
Securities Corporation ("DLJ") has in the past provided to
the Company and/or its affiliates investment banking and/or
investment advisory services including (i) participation in
the underwriting syndicate in the Company's IPO, (ii) acting
as one of the Initial Purchasers in the Original Offering
and the Over-Allotment Offering and (iii) acting as the
exclusive agent to, and financial advisor of, the Company in
connection with the Securitization Facility. See "Recent
Developments - Securitization Facility" in the Prospectus.
In each case, DLJ has received only customary fees in
connection with the provision of such services. In addition,
DLJ executed an agreement with the Company on May 24, 1996
granting DLJ the right to receive an aggregate of $20
million in payments during May, June and July of 1997 out of
the amounts collected from receivables owed to the Company
by Merisel FAB under the distribution and services
agreements dated as of January 31, 1994, as amended, between
the Company and Merisel. DLJ paid the Company $15.6 million
for the right to receive these payments. See "Recent
Developments - Agreement with Donaldson, Lufkin & Jenrette
for Payment against Merisel Receivables" in the Prospectus.
(5) Includes 1,978,750 Preferred Securities (or 49.2% of the
total number of Preferred Securities outstanding) set forth
in the First Prospectus Supplement.
Except as set forth above, none of the other Selling Holders has,
or within the past three years has had, any position, office or
other material relationship with the Trust or the Company or any
of their predecessors or affiliates.
The Selling Holders identified above may have sold,
transferred or otherwise disposed of all or a portion of their
Preferred Securities since the date on which they provided the
information regarding their Preferred Securities in transactions
exempt from the registration requirements of the Securities Act.
None of the above listed Selling Holders has converted any of the
Preferred Securities into shares of Company Common Stock. See
"Description of Preferred Securities - Conversion Rights" in the
Prospectus. Additional Selling Holders or other information
concerning the above listed Selling Holders may be set forth from
time to time in additional prospectus supplements.
