Exhibit 10.26

STOCK PURCHASE AGREEMENT

BY AND AMONG

MARUBENI CORPORATION

AS SELLER

AND

SYNNEX INVESTMENT HOLDINGS CORPORATION or its designee(s)

AND

SB PACIFIC CORPORATION LIMITED

AS BUYERS

Dated November 12, 2010

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TABLE OF CONTENTS

 

            Page   ARTICLE 1 SALE AND TRANSFER OF SHARES; CLOSING      1   

1.1

     Sale of Shares      1   

1.2

     Purchase Price and Payment      1   

1.3

     Closing      2   

1.4

     Purchase Price Adjustment      2    ARTICLE 2 REPRESENTATIONS AND
WARRANTIES OF SELLER      3   

2.1

     Organization and Good Standing      3   

2.2

     Authority; No Conflict      4   

2.3

     Capitalization      5   

2.4

     Financial Statements      5   

2.5

     Books and Records      6   

2.6

     Title to Properties; Encumbrances      6   

2.7

     Condition and Sufficiency of Assets      7   

2.8

     Accounts Receivable      7   

2.9

     Inventory      8   

2.10

     Liabilities      8   

2.11

     Taxes      8   

2.12

     No Material Adverse Change      9   

2.13

     Employee Benefits      9   

2.14

     Compliance With Legal Requirements; Governmental Authorizations      10   

2.15

     Legal Proceedings; Orders      11   

2.16

     Absence of Certain Changes and Events      12   

2.17

     Contracts; No Defaults      13   

2.18

     Insurance      14   

2.19

     Environmental Matters      14   

2.20

     Employees      15   

2.21

     Labor Relations; Compliance      16   

2.22

     Intellectual Property      16   

2.23

     Officers and Directors      19   

2.24

     Customers and Vendors      19   

2.25

     Certain Payments      19   

2.26

     Disclosure      20   

2.27

     Relationships With Related Persons      20   

2.28

     Brokers or Finders      20   

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF BUYERS

     20   

3.1

     Organization and Good Standing      20   

3.2

     Authority; No Conflict      21   

3.3

     Investment Intent      21   

3.4

     Certain Proceedings      21   

3.5

     Financial Capability      21   

3.6

     Brokers or Finders      22   

ARTICLE 4 COVENANTS OF SELLER PRIOR TO CLOSING DATE

     22   

4.1

     Access and Investigation      22   

 

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4.2

     Operation of the Businesses of the Acquired Company      22   

4.3

     Negative Covenant      22   

4.4

     Required Approvals      23   

4.5

     Notification      23   

4.6

     Payment of Indebtedness to Related Persons      23   

4.7

     No Negotiation      23   

4.8

     Best Efforts      24   

ARTICLE 5 COVENANTS OF BUYERS PRIOR TO CLOSING DATE

     24   

5.1

     Approvals of Governmental Bodies      24   

5.2

     Best Efforts      24   

5.3

     Repayment of MF Credit Facility Obligations      24   

ARTICLE 6 CONDITIONS PRECEDENT TO BUYERS’ OBLIGATION TO CLOSE

     24   

6.1

     Accuracy of Representations      24   

6.2

     Seller’s Performance      25   

6.3

     Consents      25   

6.4

     Additional Documents      25   

6.5

     No Proceedings      25   

6.6

     No Claim Regarding Stock Ownership or Sale Proceeds      25   

6.7

     No Prohibition      26   

6.8

     Confirmation of Intentions of Vendors      26   

6.9

     Amendment to Logipartners’ Logistics Services Agreement      26   

ARTICLE 7 CONDITIONS PRECEDENT TO SELLER’S OBLIGATION TO CLOSE

     26   

7.1

     Accuracy of Representations      27   

7.2

     Buyers’ Performance      27   

7.3

     Additional Documents      27   

7.4

     No Injunction      27   

ARTICLE 8 CLOSING OBLIGATIONS

     27   

8.1

     Closing Deliveries by Seller      27   

8.2

     Closing Deliveries by Buyers      28   

ARTICLE 9 TERMINATION

     28   

9.1

     Termination Events      28   

9.2

     Effect of Termination      29   

ARTICLE 10 INDEMNIFICATION; REMEDIES

     29   

10.1

     Survival; Right to Indemnification Not Affected by Knowledge      29   

10.2

     Indemnification and Payment of Damages by Seller      29   

10.3

     Indemnification and Payment of Damages by Buyers      30   

10.4

     Time Limitations      30   

10.5

     Limitations on Amount—Seller      30   

10.6

     Limitations on Amount—Buyers      31   

10.7

     Right of Set-Off      31   

10.8

     Procedure for Indemnification—Third Party Claims      31   

 

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10.9

     Procedure for Indemnification—Other Claims      32   

10.10

     Reduction for Insurance, Taxes and Other Offsets      32   

10.11

     Indemnification Adjusts Purchase Price for Tax Purposes      33   

ARTICLE 11 POST-CLOSING COVENANTS

     33   

11.1

     Compliance with Agreements      33   

11.2

     Name Change      33   

11.3

     Employee Retention      33   

11.4

     Other Business Matters      34   

ARTICLE 12 GENERAL PROVISIONS

     34   

12.1

     Expenses      34   

12.2

     Public Announcements      34   

12.3

     Confidentiality      34   

12.4

     Notices      35   

12.5

     Jurisdiction; Service of Process      36   

12.6

     Further Assurances      36   

12.7

     Waiver      36   

12.8

     Entire Agreement and Modification      37   

12.9

     Disclosure Letter      37   

12.10

     Assignments, Successors, and No Third-Party Rights      37   

12.11

     Severability      37   

12.12

     Section Headings, Construction      37   

12.13

     Time of Essence      38   

12.14

     Governing Law      38   

12.15

     Counterparts      38   

ARTICLE 13 DEFINITIONS

     38   

 

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STOCK PURCHASE AGREEMENT

This Stock Purchase Agreement (“Agreement”) is made as of November 12, 2010, by
and among SYNNEX Investment Holdings Corporation, a BVI corporation or its
designee(s) (“SYNNEX”), SB Pacific Corporation Limited, a Hong Kong corporation
(“SB Pacific”) (SYNNEX and SB Pacific being individually referred to as “Buyer”
and collectively as “Buyers”) and Marubeni Corporation, a Japanese corporation
(“Seller”).

RECITALS

WHEREAS, Seller owns all of the outstanding shares of the capital stock of
Marubeni Infotec Corporation, a Japanese corporation (the “Acquired Company”);
and

WHEREAS, Seller desires to sell and transfer to Buyers and Buyers desire to
purchase from Seller 14,616,350 common shares of the Acquired Company, being all
of the issued and outstanding shares of common stock of the Acquired Company
(the “Shares”), upon the terms and conditions set forth herein.

AGREEMENT

In consideration of the foregoing and the representations, warranties, covenants
and agreements in this Agreement and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, each of Seller and
Buyers hereby agree as follows:

ARTICLE 1

SALE AND TRANSFER OF SHARES; CLOSING

1.1 Sale of Shares

Subject to the terms and conditions of this Agreement, at the Closing, Seller
will sell and transfer the Shares to Buyers, and Buyers will purchase the Shares
from Seller, such that SYNNEX will purchase the SYNNEX Allocated Shares and SB
Pacific the SB Pacific Allocated Shares.

1.2 Purchase Price and Payment

(a) Subject to the Adjustment Amount, the total purchase price (the “Purchase
Price”) for the Shares will be Japanese Yen Seven Hundred Million
(JP¥700,000,000).

(b)(i) At the Closing, SYNNEX and SB Pacific will collectively pay Japanese Yen
Five Hundred Million (JP¥500,000,000) of the Purchase Price to Seller by wire
transfer of immediately available funds to an account specified by Seller to the
Buyers in writing at least ten (10) Business Days prior to Closing; and

(ii) At the Closing, Buyers shall wire transfer an amount of Japanese Yen Two
Hundred Million (JP¥200,000,000) (the “Escrow Amount”) into a newly established
Seller’s account located in Japan, which is separated from other bank accounts
of Seller, at Seller’s main bank in Japan or another bank with Buyers’ consent,
and the withdrawal of the Escrow Amount shall be subject to

 

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the mutual written agreement of Seller and Buyers (not to be unreasonably
withheld), subject to the terms hereof. The Escrow Amount shall be deposited by
Seller as collateral security for liabilities of Seller to Buyers under this
Agreement. All amount of the Escrow Amount will be fully released to Seller on
the first anniversary of the Closing; provided, however, that if on or prior to
the first anniversary of the Closing, any Indemnified Persons has notified
Seller of a claim and the claim(s) in such notification has(ve) not been finally
resolved prior to such first anniversary, Seller shall retain the Escrow Amount,
until such claim(s) is(are) finally resolved.

1.3 Closing

The purchase and sale (the “Closing”) provided for in this Agreement will take
place at the offices of Seller’s counsel in Tokyo, Japan, at 10:00 a.m. (local
time) on the later of (i) December 1, 2010 or (ii) at such other time and place
as the parties hereto may agree. Subject to the provisions of Section 9.1,
failure to consummate the purchase and sale provided for in this Agreement on
the date and time and at the place determined pursuant to this Section 1.3 will
not result in the termination of this Agreement and will not relieve any party
hereto of any obligation under this Agreement.

1.4 Purchase Price Adjustment

(a) Seller and Buyers agree that the Purchase Price will be subject to
adjustment calculated by the difference between (i) the shareholders’ equity
figure of the Acquired Company as of July 1, 2010, being a negative
JP¥516,000,000, and which is shown by the balance sheet on Exhibit C, reflecting
monthly rebate accruals, (the “Initial Balance Sheet”) and (ii) the
shareholders’ equity figure set forth in a balance sheet statement determined as
of the Closing Date (the “Closing Balance Sheet”) as provided for hereinbelow.

(b) As promptly as practicable after the Closing, Buyers, after consultation
with Seller shall cause to be prepared and delivered to Seller a Closing Balance
Sheet, showing monthly rebate accruals, which is prepared by an independent
accounting firm acceptable to Seller and in a manner generally consistent with
the Initial Balance Sheet. Seller will cooperate as reasonably requested by
Buyers in connection with the preparation of the foregoing. Buyers shall
promptly provide to Seller upon request copies of all work papers and supporting
documentation which form the basis of the Closing Balance Sheet. The accounting
firm which prepared the Closing Balance Sheet will also provide its calculation
of the adjustment to the Purchase Price (the “Adjustment Amount Calculation”)
determined in accordance with Section 1.4(a) above.

(c) If Seller disagrees with the aforesaid calculation of the Closing Balance
Sheet and the Adjustment Amount Calculation, Seller shall have thirty (30) days
after its receipt of the Closing Balance Sheet and the Adjustment Amount
Calculation to deliver to Buyers a statement (the “Objection Notice”) setting
forth in reasonable detail any objection Seller has to the Closing Balance Sheet
and the Adjustment Amount Calculation and the basis for each such objection. If
Seller does not deliver an Objection Notice to Buyers within such thirty
(30) day period, or if Seller notifies Buyer in writing that the Closing Balance
Sheet and the Adjustment Amount Calculation are acceptable, then the Closing
Balance Sheet and the Adjustment Amount Calculation shall be deemed to have been
accepted by Seller and shall become final, conclusive and binding upon the
parties to this Agreement and any amounts owing as a result thereof shall be
paid in accordance with Section 1.4(e).

 

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(d) If Seller does deliver an Objection Notice to Buyers within the thirty
(30) day period as set forth in Section 1.4(c), Buyers and Seller shall, for
thirty (30) days after the Objection Notice has been given, negotiate in good
faith to resolve the objections set forth in the Objection Notice. In connection
with such good faith negotiation, Seller shall promptly provide to Buyers upon
request copies of all work papers and supporting documentation which form the
basis of the Objection Notice. If, at the end of such thirty (30) day period,
Buyers and Seller are unable to agree upon the Closing Balance Sheet and an
Adjustment Amount, then at any time thereafter upon request of Buyers or Seller,
Buyers and Seller shall engage the Accounting Arbitrator to resolve any dispute
regarding the Closing Balance Sheet or the Adjustment Amount Calculation, as the
case may be. As promptly as practicable thereafter (but in no event later than
ten (10) days after the Accounting Arbitrator’s engagement), Buyers and Seller
shall submit any unresolved item set forth in the Objection Notice to the
Accounting Arbitrator in writing together with any supporting arguments and
documentation (each with a copy to the other party). Buyers and Seller shall
direct that the Accounting Arbitrator render his determination within fifteen
(15) Business Days following his receipt of the responses from both parties, and
Buyers and Seller and their respective representatives, will cooperate with the
Accounting Arbitrator during his engagement. The Accounting Arbitrator will
consider only those issues related to the Closing Balance Sheet or the
Adjustment Amount Calculation that Buyers and Seller have been unable to
resolve. In resolving any disputed item, the Accounting Arbitrator may not
assign a value to any item greater than the greatest value assigned by Buyers or
Seller for such item or less than the smallest value assigned by Buyers to
Seller for such item. The Accounting Arbitrator’s determination will be based on
Japanese GAAP consistently applied (except to the extent that the line items
contained therein vary from Japanese GAAP, in which case, preparation of such
line item shall be so varied). The determination of the Accounting Arbitrator
will be conclusive and shall become final and binding on Buyers and Seller and
any amounts owing as a result thereof shall be paid in accordance with
Section 1.6(e). Buyers and Seller shall each pay one-half (1/2) of the fees and
expenses of the Accounting Arbitrator.

(e) All payments to be made pursuant to this Section 1.4 shall be by wire
transfer of immediately available funds to the account(s) designated in writing,
at least three (3) Business Days prior to the scheduled payment date, by Buyers
or Seller, as the case may be.

ARTICLE 2

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Buyers as follows:

2.1 Organization and Good Standing

(a) Seller is a corporation duly organized and validly existing under the laws
of its jurisdiction of incorporation, with full corporate power and authority to
conduct its businesses as it is now being conducted. The Acquired Company is a
corporation validly existing under the laws of its jurisdiction, with full
corporate power and authority to conduct the Acquired Company’s Businesses, to
own or use the properties and assets that it purports to own or use, and to
perform all its obligations under Applicable Contracts.

(b) Seller has delivered to Buyers copies of the Organizational Documents.

 

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(c) Except as may be set forth in Part 2.1(c) of the Disclosure Letter, the
Acquired Company has no presently existing Subsidiary.

2.2 Authority; No Conflict

(a) Upon the execution and delivery by Seller of this Agreement and each
Ancillary Document of Seller, this Agreement and each Ancillary Document of
Seller will constitute the legal, valid, and binding obligations of Seller,
enforceable against Seller in accordance with their respective terms. Seller has
the right, power, authority, and capacity to execute and deliver this Agreement
and the Ancillary Documents of Seller and to perform its obligations under this
Agreement and the Ancillary Documents of Seller.

(b) Except as set forth in Part 2.2 of the Disclosure Letter, neither the
execution and delivery of this Agreement nor the consummation or performance of
any of the Contemplated Transactions will, directly or indirectly (with or
without notice or lapse of time):

(i) contravene, conflict with, or result in a violation of (A) any provision of
the Organizational Documents of Seller or the Acquired Company, or (B) any
resolution adopted by the board of directors or the stockholders of Seller or
the Acquired Company;

(ii) contravene, conflict with, or result in a violation of, or give any
Governmental Body or other Person the right to challenge any of the Contemplated
Transactions or to exercise any remedy or obtain any relief under, any Legal
Requirement or any Order to which the Acquired Company or Seller, or any of the
assets owned or used by the Acquired Company, may be subject;

(iii) contravene, conflict with, or result in a violation of any of the terms or
requirements of, or give any Governmental Body the right to revoke, withdraw,
suspend, cancel, terminate, or modify, any Governmental Authorization that is
held by the Acquired Company or that otherwise relates to the business of, or
any of the assets owned or used by, the Acquired Company;

(iv) cause the Acquired Company to become subject to, or to become liable for
the payment of, any Tax in Japan;

(v) cause any of the assets owned by the Acquired Company to be reassessed or
revalued by any Japanese taxing authority or other Japanese Governmental Body;

(vi) contravene, conflict with, or result in a violation or breach of any
provision of, or give any Person the right to declare a default or exercise any
remedy under, or to accelerate the maturity or performance of, or to cancel,
terminate, or modify, any Applicable Contract; or

(vii) result in the imposition or creation of any Encumbrance upon or with
respect to any of the assets owned or used by the Acquired Company.

Except as set forth in Part 2.2 of the Disclosure Letter, neither Seller nor the
Acquired Company is or will be required to give any notice to or obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.

 

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2.3 Capitalization

The authorized equity securities of the Company consist of 58,390,000 shares of
common stock, zero (0) par value per share, of which 14,616,350 shares are
issued and outstanding and constitute the Shares. Seller is and will be on the
Closing Date the record and beneficial owner and holder of the Shares, free and
clear of all Encumbrances. The Shares constitute all of the outstanding equity
and other securities of the Acquired Company. No legend or other reference to
any purported Encumbrance appears upon any certificate representing equity
securities of the Acquired Company. All of the outstanding equity securities of
the Acquired Company have been duly authorized and validly issued and are fully
paid and nonassessable. There are no Contracts relating to the issuance, sale,
or transfer of any equity securities or other securities of the Acquired
Company. None of the outstanding equity securities or other securities of the
Acquired Company was issued in violation of any applicable securities law or any
other Legal Requirement. Except as set forth in Part 2.3 of the Disclosure
Letter, the Acquired Company does not own, or have any Contract to acquire, any
equity securities or other securities of any Person or any direct or indirect
equity or ownership interest in any other business.

2.4 Financial Statements

(a) Seller has delivered to Buyers: (i) unaudited balance sheets of the Acquired
Company as at March 31st in each of the years 2008 through 2010, and the related
unaudited statements of income, changes in stockholders’ equity, and cash flow
for each of the fiscal years then ended, together with the report thereon of
Ernst & Young ShinNihon LLC, independent certified public accountants (the
“Financial Statements”), and (ii) an unaudited balance sheet of the Acquired
Company as at September 30, 2010 (the “Interim Balance Sheet”) and the related
unaudited statements of income, changes in stockholders’ equity, and cash flow
for the seven months then ended, including in each case the notes thereto. Such
Financial Statements and notes fairly present the financial condition and the
results of operations, changes in stockholders’ equity, and cash flow of the
Acquired Company as at the respective dates of and for the periods referred to
in such financial statements, all in accordance with Japanese GAAP. The
Financial Statements reflect the consistent application of such accounting
principles throughout the periods involved. No financial statements of any
Person are required by Japanese GAAP to be included in the consolidated
financial statements of the Acquired Company.

(b) The Acquired Company, to knowledge of Seller has established and maintains a
system of internal accounting controls that are effective in providing
reasonable assurance regarding the reliability of the preparation of financial
statements (including the Financial Statements), including policies and
procedures that (a) require the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of the assets of
the Acquired Company, (b) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of true and correct financial
statements, and (c) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the assets of the
Acquired Company. Neither the management of the Acquired Company nor the
Acquired Company’s independent auditors has identified or been made aware of
(i) any significant deficiency or material weakness in the system of internal
accounting controls utilized by the Acquired Company, (ii) any fraud, whether or
not material, that involves the Acquired Company management or other employees
who have a role in the preparation of financial statements or the internal

 

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accounting controls utilized by the Acquired Company or (iii) any claim or
allegation regarding any of the foregoing.

2.5 Books and Records

The currently existing books of account, minute books, stock record books, and
other records of the Acquired Company, all of which have been made available to
Buyers, are complete and correct in respect to matters set forth therein during
the period in which Seller has owned one hundred percent (100%) of the shares of
the Acquired Company, and those materials have been maintained in accordance
with sound business practices and the requirements of Japanese law. In respect
to the period in which Seller has one hundred percent (100%) of the shares of
owned the Acquired Company, those minute books of the Acquired Company contain
accurate and complete records of all meetings held of, and corporate action
taken by, the stockholders, the Board of Directors, and committees of the Board
of Directors of the Acquired Company, and no meeting of any such stockholders,
Board of Directors, or committee has been held during that period for which
minutes have not been prepared and are not contained in such minute books. At
the Closing, all of those books and records will be in the possession of the
Acquired Company.

2.6 Title to Properties; Encumbrances

(a) Part 2.6 of the Disclosure Letter contains a complete and accurate list of
all real estate, leaseholds, or other real property interests owned by the
Acquired Company. Seller has delivered or made available to Buyers copies of the
deeds and other instruments (as recorded) by which the Acquired Company acquired
such real property and interests, and copies of all title insurance policies,
opinions, abstracts, and surveys in the possession of Seller or the Acquired
Company and relating to such property or interests.

(b) The Acquired Company owns (with good and marketable title in the case of
real property, subject only to the matters permitted by the following sentence)
all the properties and assets (whether real, personal, or mixed and whether
tangible or intangible) that it purports to own located in the facilities owned
or operated by the Acquired Company or reflected as owned in the books and
records of the Acquired Company, including all of the properties and assets
reflected in the Financial Statements and the Interim Balance Sheet (except for
assets held under capitalized leases disclosed or not required to be disclosed
in Part 2.6 of the Disclosure Letter and personal property sold since the date
of the Financial Statements and the Interim Balance Sheet, as the case may be,
in the Ordinary Course of Business), and all of the properties and assets
purchased or otherwise acquired by the Acquired Company since the date of the
Financial Statements (except for personal property acquired and sold since the
date of the Financial Statements in the Ordinary Course of Business and
consistent with past practice), which subsequently purchased or acquired
properties and assets (other than inventory and short-term investments) are
listed in Part 2.6 of the Disclosure Letter.

(c) All material properties and assets reflected in the Financial Statements and
the Interim Balance Sheet are free and clear of all Encumbrances and are not, in
the case of real property, subject to any rights of way, building use
restrictions, exceptions, variances, reservations, or limitations of any nature
except, with respect to all such properties and assets, (a) mortgages or
security interests shown on the Financial Statements or the Interim Balance
Sheet as securing specified liabilities or obligations, with respect to which no
default (or event that, with notice or lapse of time or both, would constitute a
default) exists,

 

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(b) mortgages or security interests incurred in connection with the purchase of
property or assets after the date of the Interim Balance Sheet (such mortgages
and security interests being limited to the property or assets so acquired),
with respect to which no default (or event that, with notice or lapse of time or
both, would constitute a default) exists, (c) liens for current taxes not yet
due, and (d) with respect to real property, (i) minor imperfections of title, if
any, none of which is substantial in amount, materially detracts from the value
or impairs the use of the property subject thereto, or impairs the operations of
the Acquired Company, and (ii) zoning laws and other land use restrictions that
do not impair the present or anticipated use of the property subject thereto.

(d) All buildings, plants, and structures owned by the Acquired Company lie
wholly within the boundaries of the real property owned by the Acquired Company
and do not encroach upon the property of, or otherwise conflict with the
property rights of, any other Person.

2.7 Condition and Sufficiency of Assets

The buildings, plants, structures, and equipment of the Acquired Company are
structurally sound, are in good operating condition and repair, and are adequate
for the uses to which they are being put, and none of such buildings, plants,
structures, or equipment is in need of maintenance or repairs except for
ordinary, routine maintenance and repairs that are not material in nature or
cost. The building, plants, structures, and equipment of the Acquired Company
are sufficient for the continued conduct of the Acquired Company’s Businesses
after the Closing in substantially the same manner as conducted prior to the
Closing.

2.8 Accounts Receivable

All accounts receivable of the Acquired Company that are reflected on the
Financial Statements or the Interim Balance Sheet or on the accounting records
of the Acquired Company as of the Closing Date (collectively, the “Accounts
Receivable”) represent or will represent valid obligations arising from sales
actually made or services actually performed in the Ordinary Course of Business.
Unless paid prior to the Closing Date, the Accounts Receivable are or will be as
of the Closing Date current and collectible net of the respective reserves shown
on the Financial Statements or the Interim Balance Sheet or on the accounting
records of the Acquired Company as of the Closing Date (which reserves are
adequate and calculated consistent with past practice and, in the case of the
reserve as of the Closing Date, will not represent a greater percentage of the
Accounts Receivable as of the Closing Date than the reserve reflected in the
Interim Balance Sheet represented of the Accounts Receivable reflected therein
and will not represent a material adverse change in the composition of such
Accounts Receivable in terms of aging). Subject to such reserves, each of the
Accounts Receivable either has been or will be collected in full, without any
set-off, within ninety days after the day on which it first becomes due and
payable. There is no contest, claim, or right of set-off, other than returns in
the Ordinary Course of Business, under any Contract with any obligor of an
Accounts Receivable relating to the amount or validity of such Accounts
Receivable. Part 2.8 of the Disclosure Letter contains a complete and accurate
list of all Accounts Receivable as of the date of the Interim Balance Sheet,
which list sets forth the aging of such Accounts Receivable.

 

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2.9 Inventory

All inventory of the Acquired Company, whether or not reflected in the Financial
Statements or the Interim Balance Sheet, consists of a quality and quantity
usable and salable in the Ordinary Course of Business, except for obsolete items
and items of below-standard quality and any inventories aged ninety (90) days or
more, all of which have been written off or written down to net realizable value
in the Financial Statements or the Interim Balance Sheet or on the accounting
records of the Acquired Company as of the Closing Date, as the case may be. All
inventories not written off have been priced at the lower of cost or net
realizable value on a first in, first out basis. The quantities of each item of
inventory (whether raw materials, work-in-process, or finished goods) are not
excessive, but are reasonable in the present circumstances of the Acquired
Company.

2.10 Liabilities

(a) Except as set forth in Part 2.10 of the Disclosure Letter, the Acquired
Company has no liabilities or obligations of any nature (whether absolute,
accrued, contingent, or otherwise) except for liabilities or obligations
reflected or reserved against in the Financial Statements or the Interim Balance
Sheet and current liabilities incurred in the Ordinary Course of Business since
the respective dates thereof.

(b) The Acquired Company currently has a line of credit (the “MF Credit
Facility”) opened with an affiliate company, Marubeni Financial Services K.K.,
under which it has currently drawdown not exceed Japanese Yen Nine Billion Two
Hundred Million (JP¥9,200,000,000) (the “MF Credit Obligation”) as of the date
of this Agreement. The Acquired Company will not hereafter increase its
drawdowns under the MF Credit Facility so as to cause its debt obligations
thereunder to be greater than the MF Credit Obligation as of the Closing Date.

2.11 Taxes

(a) The Acquired Company has filed or caused to be filed (on a timely basis
since March 31, 2004) all Tax Returns that are or were required to be filed by
it, either separately or as a member of a group of corporations, pursuant to
applicable Legal Requirements. Seller has delivered or made available to Buyers
copies of, and Part 2.11 of the Disclosure Letter contains a complete and
accurate list of, all such Tax Returns filed since March 31, 2004. The Acquired
Company has paid, or made provision for the payment of, all Taxes that have or
may have become due pursuant to those Tax Returns or otherwise, or pursuant to
any assessment received by Seller or the Acquired Company, except such Taxes, if
any, as are listed in Part 2.11 of the Disclosure Letter and are being contested
in good faith and as to which adequate reserves (determined in accordance with
Japanese GAAP) have been provided in the Financial Statements delivered to
Buyers as set forth in Section 2.4 above.

(b) Part 2.11 of the Disclosure Letter contains a complete and accurate list of
all audits of all such Tax Returns, including a reasonably detailed description
of the nature and outcome of each audit. All deficiencies proposed as a result
of any such audits have been paid, reserved against, settled, or, as described
in Part 2.11 of the Disclosure Letter, are being contested in good faith by
appropriate proceedings. Part 2.11 of the Disclosure Letter describes all
adjustments to the Tax Returns filed by the Acquired Company for all taxable
years since March 31, 2004, and the resulting deficiencies proposed by the
Japanese tax authorities. Except as described in Part 2.11 of the Disclosure
Letter, neither Seller nor the

 

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Acquired Company has given or been requested to give waivers or extensions (or
is or would be subject to a waiver or extension given by any other Person) of
any statute of limitations relating to the payment of Taxes of the Acquired
Company or for which the Acquired Company may be liable.

(c) The charges, accruals, and reserves with respect to Taxes on the respective
books of the Acquired Company are adequate (determined in accordance with
Japanese GAAP) and are at least equal to that Acquired Company’s liability for
Taxes. There exists no proposed tax assessment against the Acquired Company
except as disclosed in the Financial Statements or in Part 2.11 of the
Disclosure Letter. All Taxes that the Acquired Company is or was required by
Legal Requirements to withhold or collect have been duly withheld or collected
and, to the extent required, have been paid to the proper Governmental Body or
other Person.

(d) All Tax Returns filed by (or that include on a consolidated basis) the
Acquired Company are true, correct, and complete. There is no tax sharing
agreement that will require any payment by the Acquired Company after the date
of this Agreement.

2.12 No Material Adverse Change

Since the date of the Financial Statements, there has not been any material
adverse change in the business, operations, properties, prospects, assets, or
condition of the Acquired Company, and no event has occurred or circumstance
exists that may result in such a material adverse change.

2.13 Employee Benefits

(a) Except as set forth in Section 2.13(a) of the Disclosure Letter, the
Acquired Company has not previously had or currently has in place any “Benefit
Plans,” as herein defined.

“Benefit Plan” means any of the following: any plan, program, arrangement or
agreement providing for severance or retention benefits, profit-sharing, fees,
bonuses, stock options, stock appreciation, stock purchase or other
stock-related rights, current compensation, incentive or deferred compensation,
change-in-control benefits, vacation benefits, insurance, health or medical
benefits, dental benefits, employee assistance programs, disability benefits,
workers’ compensation benefits or post-employment or retirement benefits and any
material fringe benefits (excluding any plans, programs or arrangements mandated
by applicable law) that is sponsored, maintained or contributed to, or required
to be maintained or contributed to, or with respect to which Liability is borne,
by Seller or the Acquired Company for the benefit of any employee of the
Acquired Company. Seller has made available to Buyers for their inspection true
and complete copies of the presently existing Benefit Plans of the Acquired
Company.

(b) Neither the execution of, nor consummation of, the Contemplated Transactions
will (either alone or upon the occurrence of any additional or subsequent event)
constitute an event under any Benefit Plan that will or may result in any
payment or provision of, acceleration of, vesting or increase in, any benefits
(whether of severance pay or otherwise), with respect to any current of former
employee, independent contractor, consultant, agent or director of the Acquired
Company thereof, or any beneficiary thereof, with respect to which the Acquired
Company may have any obligations or material liability.

 

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(c) Except as set forth in Section 2.13(c) of the Disclosure Letter, there are
no unfunded obligations of the Acquired Company in respect to any Benefit Plans
except as otherwise such may be expressly reserved on its Financial Statements
and Interim Balance Sheet.

(d) Seller has delivered to Buyers, or will deliver to Buyers within ten days of
the date of this Agreement:

(i) all documents that set forth the terms of each Benefit Plan;

(ii) all personnel, payroll, and employment manuals and policies;

(iii) all collective bargaining agreements;

(iv) all insurance policies purchased by or to provide benefits under any
Benefit Plan;

(v) all contracts with third party administrators, actuaries, investment
managers, consultants, and other independent contractors that relate to any
Benefit Plan; and

(vi) all reports submitted within the four years preceding the date of this
Agreement by third party administrators, actuaries, investment managers,
consultants, or other independent contractors with respect to any Benefit Plan.

(e) Except as set forth in Part 2.13(e) of the Disclosure Letter:

(i) The Acquired Company has performed all of its respective obligations under
the Benefit Plans. The Acquired Company has made appropriate entries in its
financial records and statements for all obligations and liabilities under such
Benefit Plans that have accrued but are not due.

(ii) No statement, either written or oral, has been made by the Acquired Company
to any Person with regard to any Benefit Plan that was not in accordance with
the Benefit Plan and that could have an adverse economic consequence to the
Acquired Company or to Buyers.

(iii) The Acquired Company, with respect to all Benefit Plans is, and each
Benefit Plan is, in full compliance with other applicable laws and with any
applicable collective bargaining agreement.

(iv) No event has occurred or circumstance exists that could result in a
material increase in premium costs of Benefit Plans that are insured, or a
material increase in benefit costs of such Benefit Plan that are self-insured.

2.14 Compliance With Legal Requirements; Governmental Authorizations

(a) Except as set forth in Part 2.14 of the Disclosure Letter:

(i) The Acquired Company is, and at all times since (A) to Seller’s knowledge,
March 31, 2007 to March 30, 2008, and (B) March 31, 2008, has been, in full
compliance with each Legal Requirement that is or was applicable to it or to the

 

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conduct or operation of the Acquired Company’s Businesses or the ownership or
use of any of its assets;

(ii) no event has occurred or circumstance exists that (with or without notice
or lapse of time) (A) may constitute or result in a violation by the Acquired
Company of, or a failure on the part of the Acquired Company to comply with, any
Legal Requirement, or (B) may give rise to any obligation on the part of the
Acquired Company to undertake, or to bear all or any portion of the cost of, any
remedial action of any nature; and

(iii) the Acquired Company has not received, at any time since (A) to Seller’s
knowledge, March 31, 2007 to March 30, 2008, and (B) March 31, 2008, any notice
or other communication (whether oral or written) from any Governmental Body or
any other Person regarding (A) any actual, alleged, possible, or potential
violation of, or failure to comply with, any Legal Requirement, or (B) any
actual, alleged, possible, or potential obligation on the part of the Acquired
Company to undertake, or to bear all or any portion of the cost of, any remedial
action of any nature.

(b) Part 2.14 of the Disclosure Letter contains a complete and accurate list of
each Governmental Authorization that is held by the Acquired Company or that
otherwise relates to the business of, or to any of the assets owned or used by,
the Acquired Company. Each Governmental Authorization listed or required to be
listed in Part 2.14 of the Disclosure Letter is valid and in full force and
effect.

No event has occurred or circumstance exists that may (with or without notice or
lapse of time) (A) constitute or result directly or indirectly in a violation of
or a failure to comply with any term or requirement of any Governmental
Authorization listed or required to be listed in Part 2.14 of the Disclosure
Letter, or (B) result directly or indirectly in the revocation, withdrawal,
suspension, cancellation, or termination of, or any modification to, any
Governmental Authorization listed or required to be listed in Part 2.14 of the
Disclosure Letter.

All applications required to have been filed for the renewal of the Governmental
Authorization listed or required to be listed in Part 2.14 of the Disclosure
Letter have been duly filed on a timely basis with the appropriate Governmental
Bodies, and all other filings required to have been made with respect to such
Governmental Authorizations have been duly made on a timely basis with the
appropriate Governmental Bodies.

The Governmental Authorizations listed in Part 2.14 of the Disclosure Letter
collectively constitute all of the Governmental Authorizations necessary to
permit the Acquired Company to lawfully conduct and operate the Acquired
Company’s Businesses in the manner they currently conduct and operate such
businesses and to permit the Acquired Company to own and use its assets in the
manner in which it currently own and use such assets.

2.15 Legal Proceedings; Orders

(a) Except as set forth in Part 2.15 of the Disclosure Letter, there is no
pending Proceeding:

 

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(i) that has been commenced by or against the Acquired Company or that otherwise
relates to or may affect the business of, or any of the assets owned or used by,
the Acquired Company; or

(ii) that challenges, or that may have the effect of preventing, delaying,
making illegal, or otherwise interfering with, any of the Contemplated
Transactions.

To the Knowledge of Seller and the Acquired Company, (1) no such Proceeding has
been Threatened, and (2) no event has occurred or circumstance exists that may
give rise to or serve as a basis for the commencement of any such Proceeding.
Seller has delivered to Buyers copies of all pleadings, correspondence, and
other documents relating to each Proceeding listed in Part 2.15 of the
Disclosure Letter. The Proceedings listed in Part 2.15 of the Disclosure Letter
will not have a material adverse effect on the business, operations, assets,
condition, or prospects of the Acquired Company.

(b) There is no Order to which the Acquired Company, or any of the assets owned
or used by the Acquired Company, is subject. No officer, director, agent, or
employee of the Acquired Company is subject to any Order that prohibits such
officer, director, agent, or employee from engaging in or continuing any
conduct, activity, or practice relating to the business of the Acquired Company.

2.16 Absence of Certain Changes and Events

Except as set forth in Part 2.16 of the Disclosure Letter, since March 31, 2010,
the Acquired Company has conducted its businesses only in the Ordinary Course of
Business and there has not been any:

(a) change in any Acquired Company’s authorized or issued capital stock; grant
of any stock option or right to purchase shares of capital stock of the Acquired
Company; issuance of any security convertible into such capital stock; grant of
any registration rights; purchase, redemption, retirement, or other acquisition
by the Acquired Company of any shares of any such capital stock; or declaration
or payment of any dividend or other distribution or payment in respect of shares
of capital stock;

(b) amendment to the Organizational Documents of the Acquired Company;

(c) payment or increase by the Acquired Company of any bonuses, salaries, or
other compensation to any stockholder, director, officer, or (except in the
Ordinary Course of Business) employee or entry into any employment, severance,
or similar Contract with any director, officer, or employee;

(d) adoption of, or increase in the payments to or benefits under, any profit
sharing, bonus, deferred compensation, savings, insurance, pension, retirement,
or other employee benefit plan for or with any employees of the Acquired
Company;

(e) damage to or destruction or loss of any asset or property of the Acquired
Company, whether or not covered by insurance, materially and adversely affecting
the properties, assets, business, financial condition, or prospects of the
Acquired Company, taken as a whole;

(f) entry into, termination of, or receipt of notice of termination of (i) any
license, distributorship, dealer, sales representative, joint venture, credit,
or similar agreement, or (ii)

 

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any Contract or transaction involving a total remaining commitment by or to the
Acquired Company of at least JP¥10 million;

(g) sale (other than sales of inventory in the Ordinary Course of Business),
lease, or other disposition of any asset or property of the Acquired Company or
mortgage, pledge, or imposition of any lien or other encumbrance on any material
asset or property of the Acquired Company, including the sale, lease, or other
disposition of any of the Intellectual Property Assets;

(h) cancellation or waiver of any claims or rights with a value to the Acquired
Company in excess of JP¥10 million;

(i) material change in the accounting methods used by the Acquired Company; or

(j) agreement, whether oral or written, by the Acquired Company to do any of the
foregoing.

2.17 Contracts; No Defaults

(a) Part 2.17(a) of the Disclosure Letter contains a complete and accurate list,
and Seller has delivered to Buyers true and complete copies, of each Applicable
Contract.

(b) Except as set forth in Part 2.17(b) of the Disclosure Letter:

(i) Seller (and no Related Person of Seller) has not presently acquired any
rights under, and Seller will not become subject to any obligation or liability
under, any Contract that relates to the Acquired Company’s Business or any of
the assets owned or used by the Acquired Company; and

(ii) no officer, director, agent, employee, consultant, or contractor of the
Acquired Company is bound by any Contract that purports to limit the ability of
such officer, director, agent, employee, consultant, or contractor to (A) engage
in or continue any conduct, activity, or practice relating to the business of
the Acquired Company, or (B) assign to the Acquired Company or to any other
Person any rights to any invention, improvement, or discovery.

(c) Except as set forth in Part 2.17(c) of the Disclosure Letter, each
Applicable Contract identified or required to be identified in Part 2.17(a) of
the Disclosure Letter is in full force and effect and is valid and enforceable
in accordance with its terms.

(d) Except as set forth in Part 2.17(d) of the Disclosure Letter:

(i) the Acquired Company is in full compliance with all applicable terms and
requirements of each Applicable Contract;

(ii) no event has occurred or circumstance exists that (with or without notice
or lapse of time) may contravene, conflict with, or result in a violation or
breach of, or give the Acquired Company, to knowledge of Seller, or other Person
the right to declare a default or exercise any remedy under, or to accelerate
the maturity or performance of, or to cancel, terminate, or modify, any
Applicable Contract.

 

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2.18 Insurance

(a) Seller has delivered to Buyers:

(i) true and complete copies of all policies of insurance to which the Acquired
Company is a party or under which the Acquired Company, or any director of any
Acquired Company, is or has been covered at any time within the two (2) years
preceding the date of this Agreement;

(ii) true and complete copies of all pending applications for policies of
insurance; and

(iii) any statement by the auditor of the Acquired Company’s financial
statements with regard to the adequacy of such entity’s coverage or of the
reserves for claims.

(b) Part 2.18(b) of the Disclosure Letter describes all obligations of the
Acquired Company to third parties with respect to insurance (including such
obligations under leases and service agreements) and identifies the policy under
which such coverage is provided.

(c) Part 2.18(c) of the Disclosure Letter sets forth, by year, for the current
policy year and of the preceding policy year a summary of the loss experience
under each policy.

(d) Except as set forth on Part 2.18(d) of the Disclosure Letter:

(i) All policies to which the Acquired Company is a party or that provide
coverage to the Acquired Company, or any director or officer of an Acquired
Company:

(A) are valid, outstanding, and enforceable;

(B) are issued by an insurer that is, to its knowledge, financially sound and
reputable;

(C) taken together, provide adequate insurance coverage for the assets and the
operations of the Acquired Company for all risks to which the Acquired Company
are normally exposed; and

(D) do not provide for any retrospective premium adjustment or other
experienced-based liability on the part of the Acquired Company.

(ii) The Acquired Company has paid all premiums due, and has otherwise performed
all of its obligations under each policy to which the Acquired Company is a
party or that provides coverage to the Acquired Company or director thereof.

(iii) The Acquired Company has given notice to the insurer of all claims that
may be insured thereby.

2.19 Environmental Matters

Except as set forth in part 2.19 of the disclosure letter:

 

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(a) The Acquired Company is, and at all times has been, in full compliance with,
and has not been and is not in violation of or liable under, any Environmental
Law during the period in which Seller has owned one hundred percent (100%) of
the issued shares of the Acquired Company. Neither Seller nor the Acquired
Company has any basis to expect, nor has any of them or any other Person for
whose conduct the Acquired Company or may be held to be responsible received,
any actual or Threatened Order, notice, or other communication from (i) any
Governmental Body or private citizen acting in the public interest, or (ii) the
current or prior owner or operator of any Facilities, of any actual or potential
violation or failure to comply with any Environmental Law, or of any actual or
Threatened obligation to undertake or bear the cost of any Environmental,
Health, and Safety Liabilities with respect to any of the Facilities or any
other properties or assets (whether real, personal, or mixed) in which the
Acquired Company has had an interest, or with respect to any property or
Facility at or to which Hazardous Materials were generated, manufactured,
refined, transferred, imported, used, or processed by Seller, the Acquired
Company, or any other Person for whose conduct it is or may be held responsible,
or from which Hazardous Materials have been transported, treated, stored,
handled, transferred, disposed, recycled, or received.

(b) Neither the Acquired Company, nor any other Person for whose conduct it is
or may be held responsible, has any Environmental, Health, and Safety
Liabilities with respect to any of the Facilities or any other properties and
assets (whether real, personal, or mixed) in which the Acquired Company, has or
had an interest, or at any property geologically or hydrologically adjoining the
Facilities or any such other property or assets.

(c) There are no Hazardous Materials present on or in the Environment at the
Facilities or, to the knowledge of Seller, at any geologically or hydrologically
adjoining property.

(d) There has been no Release or, to the Knowledge of Seller and the Acquired
Company, Threat of Release, of any Hazardous Materials at or from the Facilities
or at any other locations where any Hazardous Materials were generated,
manufactured, refined, transferred, produced, imported, used, or processed from
or by the Facilities, or from or by any other properties and assets (whether
real, personal, or mixed) in which the Acquired Company has or had an interest,
or to the Knowledge of Seller and the Acquired Company any geologically or
hydrologically adjoining property, whether by the Acquired Company, or any other
Person.

(e) Seller has delivered to Buyers true and complete copies and results of any
reports, studies, analyses, tests, or monitoring possessed or initiated by
Seller or the Acquired Company pertaining to Hazardous Materials or Hazardous
Activities in, on, or under the Facilities, or concerning compliance by the
Acquired Company, or any other Person for whose conduct it may be held
responsible, with Environmental Laws.

2.20 Employees

(a) Part 2.20 of the Disclosure Letter contains a complete and accurate list of
the following information for each employee or director of the Acquired Company,
including each employee on leave of absence or layoff status: employee name; job
title; current compensation paid or payable; and service credited for purposes
of vesting and eligibility to participate under the Acquired Company’s pension,
retirement, profit-sharing, thrift-savings, deferred compensation, stock bonus,
stock option, cash bonus, employee stock ownership

 

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(including investment credit or payroll stock ownership), severance pay,
insurance, medical, welfare, or vacation plan or other director or employee
Benefit Plan.

(b) No employee or director of the Acquired Company is a party to, or is
otherwise bound by, any agreement or arrangement, including any confidentiality,
noncompetition, or proprietary rights agreement, between such employee or
director and any other Person (“Proprietary Rights Agreement”) that in any way
adversely affects or will affect (i) the performance of his duties as an
employee or director of the Acquired Company, or (ii) the ability of the
Acquired Company to conduct the Acquired Company’s Businesses. To Seller’s
Knowledge, no director or executives level employees of the Acquired Company
intends to terminate his or her employment with the Acquired Company.

(c) Part 2.20 of the Disclosure Letter also contains a complete and accurate
list of the following information for each retired employee or director of the
Acquired Company, or their dependents, receiving benefits or scheduled to
receive benefits in the future: name, pension benefit, pension option election,
retiree medical insurance coverage, retiree life insurance coverage, and other
benefits.

 

2.21 Labor Relations; Compliance

Since March 31, 2007, the Acquired Company has not been nor is it a party to any
collective bargaining or other labor Contract. Since March 31, 2007, there has
not been, there is not presently pending or existing, and, to Seller’s
knowledge, there is not Threatened, (a) any strike, slowdown, picketing, work
stoppage, or employee grievance process, (b) any Proceeding against or affecting
the Acquired Company relating to the alleged violation of any Legal Requirement
pertaining to labor relations or employment matters, including any charge or
complaint filed by an employee or union with any relevant Governmental Body,
organizational activity, or other labor or employment dispute against or
affecting any of the Acquired Company or its premises, or (c) any application
for certification of a collective bargaining agent. The Acquired Company has
complied in all respects with all Legal Requirements relating to employment,
equal employment opportunity, nondiscrimination, immigration, wages, hours,
benefits, collective bargaining, the payment of social security and similar
taxes, occupational safety and health, and plant closing. The Acquired Company
is not liable for the payment of any compensation, damages, taxes, fines,
penalties, or other amounts, however designated, for failure to comply with any
of the foregoing Legal Requirements.

2.22 Intellectual Property

(a) Intellectual Property Assets. The term “Intellectual Property Assets”
includes all of the following which exist with the Acquired Company as of the
date hereof and as to which the Acquired Company will acquire prior to Closing:

(i) the company name, all fictional business names, trading names, registered
and unregistered trademarks, service marks, and applications (collectively,
“Marks”);

(ii) all patents, patent applications, and inventions and discoveries that may
be patentable (collectively, “Patents”);

(iii) all copyrights in both published works and unpublished works
(collectively, “Copyrights”);

 

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(iv) all rights in mask works (collectively, “Rights in Mask Works”); and

(v) all know-how, trade secrets, confidential information, customer lists,
software, technical information, data, process technology, plans, drawings, and
blue prints (collectively, “Trade Secrets”); owned, used, or licensed by the
Acquired Company as licensee or licensor.

(b) Agreements. Part 2.22(b) of the Disclosure Letter contains a complete and
accurate list and summary description, including any royalties paid or received
by the Acquired Company, of all Contracts relating to the Intellectual Property
Assets to which the Acquired Company is a party or by which the Acquired Company
is bound, except for any license implied by the sale of a product and perpetual,
paid-up licenses for commonly available software programs with a value of less
than JP¥5 million under which the Acquired Company is the licensee. There are no
outstanding and, to Seller’s Knowledge, no Threatened disputes or disagreements
with respect to any such Contracts.

(c) Know-How Necessary for the Business

(i) The Intellectual Property Assets are all those necessary for the operation
of the Acquired Company’s Businesses as they are currently conducted. The
Acquired Company is the owner of all right, title, and interest in and to each
of the Intellectual Property Assets, free and clear of all liens, security
interests, charges, encumbrances, equities, and other adverse claims, and has
the right to use without payment to a third party all of the Intellectual
Property Assets.

(ii) Except as set forth in Part 2.22(c) of the Disclosure Letter, all former
and current employees of the Acquired Company have executed written Contracts
with the Acquired Company that assign to the Acquired Company all rights to any
inventions, improvements, discoveries, or information relating to the business
of the Acquired Company. No employee of the Acquired Company has entered into
any Contract that restricts or limits in any way the scope or type of work in
which the employee may be engaged or requires the employee to transfer, assign,
or disclose information concerning his work to anyone other than the Acquired
Company.

(d) Patents

(i) Part 2.22(d) of the Disclosure Letter contains a complete and accurate list
and summary description of all Patents. The Acquired Company is the owner of all
right, title, and interest in and to each of the Patents, free and clear of all
liens, security interests, charges, encumbrances, entities, and other adverse
claims.

(ii) All of the issued Patents are currently in compliance with formal legal
requirements (including payment of filing, examination, and maintenance fees and
proofs of working or use), are valid and enforceable, and are not subject to any
maintenance fees or taxes or actions falling due within ninety days after the
Closing Date.

(iii) No Patent has been or is now involved in any interference, reissue,
reexamination, or opposition proceeding. To Seller’s Knowledge or that of the
Acquired Company, there is no potentially interfering patent or patent
application of any third party.

 

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(iv) To Seller’s knowledge, no Patent is infringed or, to Seller’s Knowledge or
that of the Acquired Company, has been challenged or threatened in any way. To
Seller’s knowledge, none of the products manufactured and sold, nor any process
or know-how used, by the Acquired Company infringes or is alleged to infringe
any patent or other proprietary right of any other Person.

(v) All products made, used, or sold under the Patents have been marked with the
proper patent notice.

(e) Trademarks

(i) Part 2.22(e) of Disclosure Letter contains a complete and accurate list and
summary description of all Marks. The Acquired Company is the owner of all
right, title, and interest in and to each of the Marks, free and clear of all
liens, security interests, charges, encumbrances, equities, and other adverse
claims.

(ii) All Marks that have been registered with the Japanese Trademark Office are
currently in compliance with all formal legal requirements (including the timely
post-registration filing of affidavits of use and incontestability and renewal
applications), are valid and enforceable, and are not subject to any maintenance
fees or taxes or actions falling due within ninety days after the Closing Date.

(iii) No Mark has been or is now involved in any opposition, invalidation, or
cancellation and, to Seller’s Knowledge or that of the Acquired Company, no such
action is Threatened with the respect to any of the Marks.

(iv) To Seller’s Knowledge or that of the Acquired Company, there is no
potentially interfering trademark or trademark application of any third party.

(v) To Seller’s knowledge, no Mark is infringed or, to Seller’s Knowledge or
that of the Acquired Company, has been challenged or threatened in any way. To
Seller’s knowledge, none of the Marks used by the Acquired Company infringes or
is alleged to infringe any trade name, trademark, or service mark of any third
party.

(vi) All products and materials containing a Mark bear the proper registration
notice where permitted by law.

(f) Copyrights

(i) Part 2.22(f) of the Disclosure Letter contains a complete and accurate list
and summary description of all Copyrights. The Acquired Company is the owner of
all right, title, and interest in and to each of the Copyrights, free and clear
of all liens, security interests, charges, encumbrances, equities, and other
adverse claims.

(ii) All the Copyrights are currently in compliance with formal legal
requirements, are valid and enforceable, and are not subject to any maintenance
fees or taxes or actions falling due within ninety days after the date of
Closing.

(iii) To Seller’s knowledge, no Copyright is infringed or, to Seller’s Knowledge
or that of the Acquired Company, has been challenged or threatened in any way.
To Seller’s knowledge, none of the subject matter of any of the Copyrights

 

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infringes or is alleged to infringe any copyright of any third party or is a
derivative work based on the work of a third party.

(iv) All works encompassed by the Copyrights have been marked with the proper
copyright notice.

(g) Trade Secrets

(i) With respect to each Trade Secret, the documentation relating to such Trade
Secret is current, accurate, and sufficient in detail and content to identify
and explain it and to allow its full and proper use without reliance on the
knowledge or memory of any individual.

(ii) Seller and the Acquired Company have taken all reasonable precautions to
protect the secrecy, confidentiality, and value of their Trade Secrets.

(iii) The Acquired Company has good title and the (but not necessarily
exclusive) right to use the Trade Secrets. The Trade Secrets are not part of the
public knowledge or literature, and, to Seller’s Knowledge or that of the
Acquired Company, have not been used, divulged, or appropriated either for the
benefit of any Person (other than one or more of the Acquired Company) or to the
detriment of the Acquired Company. No Trade Secret is subject to any adverse
claim or has been challenged or threatened in any way.

2.23 Officers and Directors

Part 2.23 of the Disclosure Letter sets forth a list of all current directors
and officers of the Acquired Company.

2.24 Customers and Vendors

(a) Part 2.24 of the Disclosure Letter sets forth a list of top revenue
generated customers of the Acquired Company whose business with the Acquired
Company resulted in at least fifty percent (50.0%) gross revenues to the
Acquired Company, based upon the Acquired Company’s calculation of gross
revenues with respect to its customers, during the thirty-six (36) months period
ended March 31, 2010 (each, a “Major Customer”). Except as set forth on Part
2.24 of the Disclosure Letter, the Acquired Company has not received written
notice from a Major Customer asserting that the Acquired Company has breached or
is in breach of its Contract with such Major Customer, which breach constitutes
a material adverse effect on the Acquired Company. Except as set forth on Part
2.24 of the Disclosure Letter, no Major Customer has, for the six (6) month
period ended September 30, 2010, cancelled or reduced its relationship with the
Acquired Company in an amount in excess of twenty percent (20.0%) of the gross
revenue received from such Major Customer during the six (6) month period ended
September 30, 2009.

2.25 Certain Payments

During the period in which Seller has owned one hundred percent (100%) of the
shares of the Acquired Company, neither the Acquired Company nor any director,
officer, agent, or employee of the Acquired Company, or to Seller’s Knowledge,
any other Person associated with or acting for or on behalf of the Acquired
Company, has directly or indirectly (a) made any contribution, gift, bribe,
rebate (other than rebates in Ordinary Course of

 

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Business), payoff, influence payment, kickback, or other payment to any Person,
private or public, regardless of form, whether in money, property, or services
(i) to obtain favorable treatment in securing business, (ii) to pay for
favorable treatment for business secured, (iii) to obtain special concessions or
for special concessions already obtained, for or in respect of the Acquired
Company or an Affiliate of the Acquired Company, or (iv) in violation of any
Legal Requirement, (b) established or maintained any fund or asset that has not
been recorded in the books and records of the Acquired Company.

2.26 Disclosure

No representation or warranty of Seller in this Agreement and no statement in
the Disclosure Letter omits to state a material fact necessary to make the
statements herein or therein, in light of the circumstances in which they were
made, not misleading.

2.27 Relationships With Related Persons

Except as set forth in Part 2.27 of the Disclosure Letter, to Seller’s
knowledge, neither Seller nor any Related Person of Seller or of the Acquired
Company has any interest in any property (whether real, personal, or mixed and
whether tangible or intangible), used in or pertaining to the Acquired Company’s
Businesses. To Seller’s knowledge, neither Seller nor any Related Person of
Seller or of the Acquired Company is an owner of an equity interest or any other
financial or profit interest in, a Person that has (i) had business dealings or
a material financial interest in any transaction with the Acquired Company other
than business dealings or transactions conducted in the Ordinary Course of
Business with the Acquired Company at substantially prevailing market prices and
on substantially prevailing market terms, or (ii) engaged in competition with
the Acquired Company with respect to any line of the products or services of the
Acquired Company (a “Competing Business”) in any market presently served by the
Acquired Company. Except as set forth in Part 2.27 of the Disclosure Letter,
neither Seller nor any Related Person of Seller or of the Acquired Company is a
party to any Contract with, or has any claim or right against, the Acquired
Company. For purposes of this Section 2.27 only, the term “Seller’s knowledge”
shall mean “the knowledge of Finance, Logistics and IT Business Division of
Seller”.

2.28 Brokers or Finders

Seller and its agents have incurred no obligation or liability, contingent or
otherwise, for brokerage or finders’ fees or agents’ commissions or other
similar payment in connection with this Agreement, and Seller will indemnify and
hold Buyers harmless from any such payment alleged to be due by or through
Seller as a result of the action of either of Seller or its officers or agents.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF BUYERS

Each of the Buyers represents and warrants to Seller as follows:

3.1 Organization and Good Standing

Each of the Buyers, jointly and severally, is a corporation duly organized,
validly existing, and in good standing under the laws of the jurisdiction in
which its organized.

 

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3.2 Authority; No Conflict

(a) Upon the execution and delivery by Buyers of this Agreement and the
Ancillary Documents of the Buyers, this Agreement and each Ancillary Document of
Buyers will constitute the legal, valid, and binding obligations of Buyers,
enforceable against Buyers in accordance with their respective terms. Each of
the Buyers has the absolute and unrestricted right, power, and authority to
execute and deliver this Agreement and the Ancillary Documents of the Buyers and
to perform its obligations under this Agreement and the Ancillary Documents of
the Buyers.

(b) Neither the execution nor delivery of this Agreement by each of the Buyers
nor the consummation or performance of any of the Contemplated Transactions by
each of the Buyers will give any Person the right to prevent, delay, or
otherwise interfere with any of the Contemplated Transactions pursuant to:

(i) any provision of either of the Buyers Organizational Documents;

(ii) any resolution adopted by the board of directors or the stockholders of
either of the Buyers;

(iii) any Legal Requirement or Order to which either of the Buyers may be
subject; or

(iv) any Contract to which either of the Buyers is a party or by which either of
the Buyers may be bound.

Neither of the Buyers is nor will be required to obtain any Consent from any
Person in connection with the execution and delivery of this Agreement or the
consummation or performance of any of the Contemplated Transactions.

3.3 Investment Intent

Each of the Buyers is acquiring the Shares for its own account and not with a
view to their distribution.

3.4 Certain Proceedings

There is no pending Proceeding that has been commenced against either of the
Buyers and that challenges, or may have the effect of preventing, delaying,
making illegal, or otherwise interfering with, any of the Contemplated
Transactions. To each of the Buyers’ Knowledge, no such Proceeding has been
Threatened.

3.5 Financial Capability

Each of the Buyers (a) will have at the Closing all funds and available
financing sufficient to consummate the Closing of the Contemplated Transactions,
including, without limitation, the payment of the Purchase Price to Seller and
the payment of any fees and expenses in connection with the Contemplated
Transactions or the financing thereof, and (b) will have sufficient liquid
assets and funds to satisfy all of its post-Closing obligations under this
Agreement and the other documents and agreements contemplated herein.

 

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3.6 Brokers or Finders

Neither of the Buyers nor its officers and agents have incurred any obligation
or liability, contingent or otherwise, for brokerage or finders’ fees or agents’
commissions or other similar payment in connection with this Agreement, and the
Buyers will indemnify and hold Seller harmless from any such payment alleged to
be due by or through either of the Buyers as a result of the action of either of
the Buyers or its officers or agents.

ARTICLE 4

COVENANTS OF SELLER PRIOR TO CLOSING DATE

4.1 Access and Investigation

Between the date of this Agreement and the Closing Date, Seller will, and will
cause the Acquired Company and its Representatives to, (a) afford each of the
Buyers and its and their Representatives and prospective lenders and their
Representatives (collectively, “Buyers’ Advisors”) full and reasonable access to
the Acquired Company’s personnel, properties, contracts, books and records, and
other documents and data, (b) furnish Buyers and Buyers’ Advisors with copies of
all such contracts, books and records, and other existing documents and data as
the Buyers may reasonably request, and (c) furnish Buyers and Buyers’ Advisors
with such additional financial, operating, and other data and information as the
Buyers may reasonably request.

4.2 Operation of the Businesses of the Acquired Company

Between the date of this Agreement and the Closing Date, Seller will, and will
cause the Acquired Company to:

(a) conduct the business of such Acquired Company only in the Ordinary Course of
Business;

(b) use its best efforts to preserve intact the current business organization of
the Acquired Company, keep available the services of the current officers,
employees, and agents of the Acquired Company, and maintain the relations and
good will with suppliers, customers, landlords, creditors, employees, agents,
and others having business relationships with the Acquired Company;

(c) confer with Buyers concerning operational matters of a material nature; and

(d) otherwise report periodically to Buyers concerning the status of the
business, operations, and finances of the Acquired Company.

4.3 Negative Covenant

Except as otherwise expressly permitted by this Agreement, between the date of
this Agreement and the Closing Date, Seller will cause the Acquired Company not
to, without the prior consent of Buyers, (a) enter into any employment
agreements, (b) assume or incur any long term liabilities or (c) or take any
affirmative action, or fail to take any reasonable action within their or its
control, as a result of which any of the changes or events listed in
Section 2.16 is likely to occur.

 

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4.4 Required Approvals

As promptly as practicable after the date of this Agreement, Seller will, and
will cause the Acquired Company to, make all filings required by Legal
Requirements to be made by them in order to consummate the Contemplated
Transactions (including any filings under applicable antitrust or other laws).
Between the date of this Agreement and the Closing Date, Seller will, and will
cause the Acquired Company to, (a) cooperate with Buyers with respect to all
filings that Buyers elect to make or is required by Legal Requirements to make
in connection with the Contemplated Transactions, and (b) cooperate with Buyers
in obtaining all consents identified in Schedule 3.2.

4.5 Notification

Between the date of this Agreement and the Closing Date, Seller will promptly
notify Buyers in writing if Seller or the Acquired Company becomes aware of any
fact or condition that causes or constitutes a breach of any of Seller’s
representations and warranties as of the date of this Agreement, or if Seller or
the Acquired Company becomes aware of the occurrence after the date of this
Agreement of any fact or condition that would (except as expressly contemplated
by this Agreement) cause or constitute a breach of any such representation or
warranty had such representation or warranty been made as of the time of
occurrence or discovery of such fact or condition. Should any such fact or
condition require any change in the Disclosure Letter if the Disclosure Letter
were dated the date of the occurrence or discovery of any such fact or
condition, Seller will promptly deliver to Buyers a supplement to the Disclosure
Letter specifying such change. During the same period, Seller will promptly
notify Buyers of the occurrence of any breach of any covenant of Seller in this
Section 4.5 or of the occurrence of any event that may make the satisfaction of
the conditions in Article 6 impossible or unlikely.

4.6 Payment of Indebtedness to Related Persons

Other than in respect to the MF Credit Facility, Seller shall cause the Acquired
Company to pay all outstanding debt obligations, excluding trade payables, to
Seller and any affiliated entity of Seller prior to Closing and to cancel any
credit or loan agreement that the Acquired Company may have with Seller or any
affiliated entity.

4.7 No Negotiation

Until such time, if any, as this Agreement is terminated pursuant to
Section 9.1, neither Seller nor the Acquired Company nor any of its or their
officers, directors, agents or subsidiaries will, directly or indirectly,
through any officer, director, shareholder, partner, affiliate, employee, agent,
investment banker, attorney, accountant or other representative or otherwise,
(a) solicit, initiate or encourage the submission of any proposal or offer from
any Person (including any of its officers, directors, partners, shareholders,
affiliates, employees, agents and other representatives) relating to any
liquidation, dissolution, recapitalization of, merger or consolidation with or
into, or issuance or acquisition or purchase of all or substantially all of the
assets of, or any of the capital stock or equity securities of, the Acquired
Company or any of its subsidiaries or any other similar transactions or business
combination involving the Acquired Company or any of its subsidiaries, or
(b) participate in any discussions or negotiations regarding, or furnish to any
other Person any information with respect to, or otherwise cooperate in any way
with, or assist or participate in, facilitate or

 

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encourage any effort or attempt by any other person or entity to do or seek to
do any of the foregoing.

4.8 Best Efforts

Between the date of this Agreement and the Closing Date, Seller will use its
best efforts to cause the conditions in Articles 6 and 7 to be satisfied.

ARTICLE 5

COVENANTS OF BUYERS PRIOR TO CLOSING DATE

5.1 Approvals of Governmental Bodies

As promptly as practicable after the date of this Agreement, Buyers will, and
will cause each of its Related Persons to, make all filings required by Legal
Requirements to be made by them to consummate the Contemplated Transactions.
Between the date of this Agreement and the Closing Date, Buyers will, and will
cause each Related Person to, cooperate with Seller with respect to all filings
that Seller is required by Legal Requirements to make in connection with the
Contemplated Transactions, and (ii) cooperate with Seller in obtaining all
consents identified in Part 3.2 of the Disclosure Letter; provided that this
Agreement will not require Buyers to dispose of or make any change in any
portion of its business or to incur any other burden to obtain a Governmental
Authorization.

5.2 Best Efforts

Except as set forth in the proviso to Section 5.1, between the date of this
Agreement and the Closing Date, each of the Buyers will use its best efforts to
cause the conditions in Articles 6 and 7 to be satisfied.

5.3 Repayment of MF Credit Facility Obligations

Buyers will provide new credit facility arrangements for the Acquired Company to
be effective as of the Closing Date, whereby any then existing debt obligation
of the Acquired Company under the MF Credit Facility will be paid off in full as
of the Closing Date.

ARTICLE 6

CONDITIONS PRECEDENT TO BUYERS’ OBLIGATION TO CLOSE

Buyers’ obligation to purchase the Shares and to take the other actions required
to be taken by Buyers at the Closing is subject to the satisfaction, at or prior
to the Closing, of each of the following conditions (any of which may be waived
by Buyers collectively, in whole or in part):

6.1 Accuracy of Representations

(a) All of Seller’s representations and warranties in this Agreement (considered
collectively), and each of these representations and warranties (considered
individually), must have been accurate in all material respects as of the date
of this Agreement, and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date.

 

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(b) Notwithstanding the foregoing in respect to the Disclosure Letter, each of
Seller’s representations and warranties in Sections 2.1, 2.2, 2.3, 2.4, 2.12,
2.24 and 2.26 must have been accurate in all respects as of the date of this
Agreement, and must be accurate in all respects as of the Closing Date as if
made on the Closing Date, without giving effect to any supplements to the
Disclosure Letter provided to Buyers in accordance with Section 4.5 of this
Agreement.

6.2 Seller’s Performance

(a) All of the covenants and obligations that Seller is required to perform or
to comply with pursuant to this Agreement at or prior to the Closing (considered
collectively), and each of these covenants and obligations (considered
individually), must have been duly performed and complied with in all material
respects.

(b) Each document required to be delivered pursuant to Section 8.1 must have
been delivered, and each of the other covenants and obligations in Article 4
must have been performed and complied with in all respects.

6.3 Consents

Each of the Consents identified in subpart (b) of Part 2.2 of the Disclosure
Letter must have been obtained and must be in full force and effect.

6.4 Additional Documents

Seller shall deliver such other documents as Buyers may reasonably request prior
to the Closing Date for the purpose of (i) evidencing the accuracy of any of
Seller’s representations and warranties, (ii) evidencing the performance by
Seller of, or the compliance by Seller with, any covenant or obligation required
to be performed or complied with by Seller, (iii) evidencing the satisfaction of
any condition referred to in this Section 6.4, or (iv) otherwise facilitating
the consummation or performance of any of the Contemplated Transactions.

6.5 No Proceedings

Since the date of this Agreement, there must not have been commenced or
Threatened against either of the Buyers, or against any Person affiliated with
either of the Buyers, any Proceeding (a) involving any challenge to, or seeking
damages or other relief in connection with, any of the Contemplated
Transactions, or (b) that may have the effect of preventing, delaying, making
illegal, or otherwise interfering with any of the Contemplated Transactions.

6.6 No Claim Regarding Stock Ownership or Sale Proceeds

There must not have been made or Threatened by any Person any claim asserting
that such Person (a) is the holder or the beneficial owner of, or has the right
to acquire or to obtain beneficial ownership of, any stock of, or any other
voting, equity, or ownership interest in, the Acquired Company, or (b) is
entitled to all or any portion of the Purchase Price payable for the Shares.

 

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6.7 No Prohibition

Neither the consummation nor the performance of any of the Contemplated
Transactions will, directly or indirectly (with or without notice or lapse of
time), materially contravene, or conflict with, or result in a material
violation of, or cause either of the Buyers or any Person affiliated with either
of the Buyers to suffer any material adverse consequence under, (a) any
applicable Legal Requirement or Order, or (b) any Legal Requirement or Order
that has been published, introduced, or otherwise proposed by or before any
Governmental Body.

6.8 Confirmation of Intentions of Vendors

Seller shall have received confirmations in forms reasonably acceptable to
Buyers from at least nine (9) out of the following ten (10) vendors that it is
each of their present intentions to continue to do business with the Company
after Closing generally in the same manner and volumes as currently undertaken
by them with the Company:

(a) Hewlett-Packard;

(b) ASUSTEK COMPUTER;

(c) Microsoft;

(d) Lenovo;

(e) Adobe Systems;

(f) Acer;

(g) EPSON;

(h) BUFFALO;

(i) IODATA; and

(j) Allied Telesis.

6.9 Amendment to Logipartners’ Logistics Services Agreement

Buyers shall have received an amendment agreement of existing Logistics Services
Agreement between the Acquired Company and Logipartners Inc. in a form
reasonably acceptable to Buyers.

ARTICLE 7

CONDITIONS PRECEDENT TO SELLER’S OBLIGATION TO CLOSE

Seller’s obligation to sell the Shares and to take the other actions required to
be taken by Seller at the Closing is subject to the satisfaction, at or prior to
the Closing, of each of the following conditions (any of which may be waived by
Seller, in whole or in part):

 

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7.1 Accuracy of Representations

All of Buyers’ representations and warranties in this Agreement (considered
collectively), and each of these representations and warranties (considered
individually), must have been accurate in all material respects as of the date
of this Agreement and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date.

7.2 Buyers’ Performance

(a) All of the covenants and obligations that Buyers are required to perform or
to comply with pursuant to this Agreement at or prior to the Closing (considered
collectively), and each of these covenants and obligations (considered
individually), must have been performed and complied with in all material
respects.

(b) Each document required to be delivered pursuant to Section 8.2 must have
been delivered; each of the covenants and obligations in Article 5 must have
been performed and coupled with in all respects; and Buyers must have made the
cash payments required to be made by Buyers pursuant to Section 1.2(b).

7.3 Additional Documents

Buyers shall deliver to Seller such other documents as Seller may reasonably
request prior to the Closing Date for the purpose of (i) evidencing the accuracy
of any representation or warranty of Buyers, (ii) evidencing the performance by
Buyers of, or the compliance by Buyers with, any covenant or obligation required
to be performed or complied with by Buyers, (iii) evidencing the satisfaction of
any condition referred to in this Section 7.3, or (iv) otherwise facilitating
the consummation or performance of any of the Contemplated Transactions.

7.4 No Injunction

There must not be in effect any Legal Requirement or any injunction or other
Order that (a) prohibits the sale of the Shares by Seller to Buyers, and (b) has
been adopted or issued, or has otherwise become effective, since the date of
this Agreement.

ARTICLE 8

CLOSING OBLIGATIONS

8.1 Closing Deliveries by Seller

At the Closing, Seller shall deliver to Buyers:

(i) a certified copy of the shareholder register of the Acquired Company showing
that Seller owns all of the issued shares of the Acquired Company;

(ii) a certificate executed by a duly-authorized Representative of Seller
representing and warranting to Buyers that Seller’s representations and
warranties in this Agreement are accurate in all respects as of the date of this
Agreement and are accurate in all respects as of the Closing Date as if made on
the Closing Date (giving full effect to any supplements to the Disclosure Letter
that were delivered by Seller to Buyers prior to the Closing Date in accordance
with Section 4.5);

 

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(iii) an executed Non-Competition Agreement;

(iv) the written resignation (or documentation reasonably satisfactory to Buyers
showing the removal) of any director of the Acquired Company whom Seller and
Buyers agree will no longer serve as a director after the Closing with each such
resignation (or removal) effective no later than the Closing Date;

(v) the minute books and stock record books of the Acquired Company in the
possession of Seller and the Acquired Company along with the corporate seal of
the Acquired Company and the seals of the Representative Directors of the
Acquired Company;

(vi) a legal opinion from The Haruki and Tokyo-Marunouchi Law Offices, legal
counsel to Seller, as to the matters set forth in Exhibit B; and

(vii) all other documents and items required by this Agreement to be delivered,
or caused to be delivered, by Seller at Closing.

8.2 Closing Deliveries by Buyers

At the Closing, Buyers shall deliver to Seller:

(i) payment of the Purchase Price in accordance with Sections 1.2(b)(i) and
(ii);

(ii) an executed Non-Competition Agreement;

(iii) a certificate executed by duly authorized Representatives of each of the
Buyers to the effect that, except as otherwise stated in such certificate, each
of Buyer’s representations and warranties in this Agreement was accurate in all
respects as of the date of this Agreement and is accurate in all respects as of
the Closing Date as if made on the Closing Date; and

(iv) all other documents and items required by this Agreement to be delivered,
or caused to be delivered, by Buyers or at Closing.

ARTICLE 9

TERMINATION

9.1 Termination Events

This Agreement may, by notice given prior to or at the Closing, be terminated:

(a) by either Buyers or Seller if a material breach of any provision of this
Agreement has been committed by the other party and such breach has not been
waived;

(b)(i) by Buyers if any of the conditions in ARTICLE 6 have not been satisfied
as of the Closing Date or if satisfaction of such a condition is or becomes
impossible (other than through the failure of Buyers to comply with their
obligations under this Agreement) and Buyers have not waived such condition on
or before the Closing Date; or (ii) by Seller, if any of the conditions in
Article 7 has not been satisfied of the Closing Date or if satisfaction of

 

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such a condition is or becomes impossible (other than through the failure of
Seller to comply with its obligations under this Agreement) and Seller has not
waived such condition on or before the Closing Date;

(c) by written consent of Buyers and Seller; or

(d) by either Buyers or Seller if the Closing has not occurred (other than
through the failure of the party seeking to terminate this Agreement to comply
fully with its obligations under this Agreement) on or before December 31, 2010,
or such later date as the parties may agree upon.

9.2 Effect of Termination

Each party’s right of termination under Section 9.1 is in addition to any other
rights it may have under this Agreement or otherwise, and the exercise of a
right of termination will not be an election of remedies. If this Agreement is
terminated pursuant to Section 9.1, all further obligations of the parties under
this Agreement will terminate, except that the obligations in Sections 12.1,
12.2 and 12.3 will survive; provided, however, that if this Agreement is
terminated by Seller or Buyers party because of the breach of the Agreement by
the respective other party or because one or more of the conditions to the
terminating party’s obligations under this Agreement is not satisfied as a
result of the other party’s failure to comply with its obligations under this
Agreement, the terminating party’s right to pursue all legal remedies will
survive such termination unimpaired.

ARTICLE 10

INDEMNIFICATION; REMEDIES

10.1 Survival; Right to Indemnification Not Affected by Knowledge

All representations, warranties, covenants, and obligations in this Agreement,
the Disclosure Letter, the supplements to the Disclosure Letter, the
certificates delivered pursuant to this Agreement, and any other certificate or
document delivered pursuant to this Agreement will survive for a period of
twenty-four (24) months following the Closing Date unless otherwise agreed in
this Agreement. The right to indemnification, payment of Damages or other remedy
based on such representations, warranties, covenants, and obligations will not
be affected by any investigation conducted with respect to, or any Knowledge
acquired (or capable of being acquired) at any time, whether before or after the
execution and delivery of this Agreement or the Closing Date, with respect to
the accuracy or inaccuracy of or compliance with, any such representation,
warranty, covenant, or obligation. The waiver of any condition based on the
accuracy of any representation or warranty, or on the performance of or
compliance with any covenant or obligation, will not affect the right to
indemnification, payment of Damages, or other remedy based on such
representations, warranties, covenants, and obligations.

10.2 Indemnification and Payment of Damages by Seller

Subject to the limitations set forth herein, Seller will indemnify and hold
harmless Buyers and the Acquired Company (collectively the “Indemnified
Persons”) for, and will pay to the Indemnified Persons the amount of, any loss,
liability, claim, damage, expense (including costs of investigation and defense
and reasonable attorneys’ fees) or diminution of

 

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value, whether or not involving a third-party claim (collectively, “Damages”),
arising, directly or indirectly, from or in connection with:

(a) any breach of any representation or warranty made by Seller in this
Agreement, the Disclosure Letter, the supplements to the Disclosure Letter, or
any other certificate or document delivered by Seller pursuant to this
Agreement; and

(b) any breach by Seller of any covenant or obligation of Seller in this
Agreement;

The remedies provided in this Section 10.2 will not be exclusive of or limit any
other remedies that may be available to the Indemnified Persons.

10.3 Indemnification and Payment of Damages by Buyers

Subject to the limitations set forth herein, Buyers will indemnify and hold
harmless Seller, and will pay to Seller the amount of any Damages arising,
directly or indirectly, from or in connection with:

(a) any breach of any representation or warranty made by Buyers in this
Agreement or in any certificate delivered by Buyers pursuant to this Agreement;
and

(b) any breach by Buyers of any covenant or obligation of Buyers in this
Agreement.

The remedies provided in this Section 10.3 will not be exclusive of or limit any
other remedies that may be available to Seller.

10.4 Time Limitations

If the Closing occurs, Seller will have no liability (for indemnification or
otherwise) with respect to any representation or warranty, or covenant or
obligation to be performed and complied with prior to the Closing Date, other
than those in Sections 2.2, 2.3, and 2.11, unless on or before twenty-four
(24) months from the Closing Date, Buyers notify Seller of a claim specifying
the factual basis of that claim in reasonable detail to the extent then known by
Buyers; a claim with respect to Sections 2.2 and 2.3 may be made at any time
after Closing and a claim in respect to Section 2.11 may be made within six
(6) years from the Closing Date. If the Closing occurs, Buyers will have no
liability (for indemnification or otherwise) with respect to any representation
or warranty, or covenant or obligation to be performed and complied with prior
to the Closing Date, unless on or before twenty-four (24) months from the
Closing Date, Seller notify Buyers of a claim specifying the factual basis of
that claim in reasonable detail to the extent then known by Seller.

10.5 Limitations on Amount—Seller

(a) Seller will have no liability (for indemnification or otherwise) with
respect to the matters described in clause (a), clause (b) of Section 10.2 until
the total of all Damages with respect to such matters exceeds JP¥20,000,000
(Japanese Yen twenty million); provided, however, that in the event total
Damages claimed hereunder exceed such amount, then Buyers are entitled its seek
their entire Damages from the first Yen thereof. Notwithstanding to the
forgoing, the cumulative indemnification obligation of Seller under this
Agreement shall not exceed the Purchase Price in the aggregate. However, this
Section 10.5 will not apply to any breach of any of Seller’s representations and
warranties of which Seller had Knowledge at any time prior to the date on which
such representation and warranty is made

 

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or any intentional breach by Seller of any covenant or obligation, and Seller
will be liable for all Damages with respect to such breaches.

(b) In addition to the limitation set forth in Section 10.5(a), Seller shall not
be obliged to indemnify the Indemnified Persons with respect to (i) any
correctly and fully disclosed specific item in the Disclosure Letter, (ii) any
covenant or condition waived by both of the Buyers on or prior to the Closing in
writing, or (iii) any indirect, special, incidental, consequential or punitive
damages claimed by Buyer resulting from Seller’s breach of any representation or
warranty, covenant or agreement.

10.6 Limitations on Amount—Buyers

Buyers will have no liability (for indemnification or otherwise) with respect to
the matters described in clause (a) or (b) of Section 10.3 until the total of
all Damages with respect to such matters exceeds JP¥20,000,000 (Japanese Yen
Twenty Million); provided, however, that in the event total Damages claimed
hereunder exceed such amount, Seller is entitled to seek its entire Damages from
the first Yen thereof. However, this Section 10.6 will not apply to any breach
of any of Buyers’ representations and warranties of which Buyers had Knowledge
at any time prior to the date on which such representation and warranty is made
or any intentional breach by Buyers of any covenant or obligation, and Buyers
will be liable for all Damages with respect to such breaches.

10.7 Right of Set-Off

Upon notice to Seller specifying in reasonable detail the basis for such
set-off, Buyers may (and may cause the Acquired Company to) set off any amount
to which it may be entitled under this Section 10 against amounts otherwise
payable to Seller by Buyers or the Acquired Company, as the case may be. The
exercise of such right of set-off by Buyers in good faith, whether or not
ultimately determined to be justified, will not constitute an event of default
under any Contract. Neither the exercise of nor the failure to exercise such
right of set-off will constitute an election of remedies or limit Buyers in any
manner in the enforcement of any other remedies that may be available to it.

10.8 Procedure for Indemnification—Third Party Claims

(a) Promptly after receipt by an indemnified party under Section 10.2 or 10.3 of
notice of the commencement of any Proceeding against it, such indemnified party
will, if a claim is to be made against an indemnifying party under such Section,
give notice to the indemnifying party of the commencement of such claim, but the
failure to notify the indemnifying party will not relieve the indemnifying party
of any liability that it may have to any indemnified party, except to the extent
that the indemnifying party demonstrates that the defense of such action is
prejudiced by the indemnifying party’s failure to give such notice.

(b) If any Proceeding referred to in Section 10.8(a) is brought against an
indemnified party and it gives notice to the indemnifying party of the
commencement of such Proceeding, the indemnifying party will, unless the claim
involves Taxes, be entitled to participate in such Proceeding and, to the extent
that it wishes (unless (i) the indemnifying party is also a party to such
Proceeding and the indemnified party determines in good faith that joint
representation would be inappropriate, or (ii) the indemnifying party fails to
provide reasonable assurance to the indemnified party of its financial capacity
to defend such Proceeding and provide indemnification with respect to such
Proceeding), assume the defense

 

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of such Proceeding with counsel satisfactory to the indemnified party and, after
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such Proceeding, the indemnifying party will not, as long
as it diligently conducts such defense, be liable to the indemnified party under
this Section 10 for any fees of other counsel or any other expenses with respect
to the defense of such Proceeding, in each case subsequently incurred by the
indemnified party in connection with the defense of such Proceeding, other than
reasonable costs of investigation. If the indemnifying party assumes the defense
of a Proceeding, (i) it will be conclusively established for purposes of this
Agreement that the claims made in that Proceeding are within the scope of and
subject to indemnification; (ii) no compromise or settlement of such claims may
be effected by the indemnifying party without the indemnified party’s consent
unless (A) there is no finding or admission of any violation of Legal
Requirements or any violation of the rights of any Person and no effect on any
other claims that may be made against the indemnified party, and (B) the sole
relief provided is monetary damages that are paid in full by the indemnifying
party; and (iii) the indemnified party will have no liability with respect to
any compromise or settlement of such claims effected without its consent. If
notice is given to an indemnifying party of the commencement of any Proceeding
and the indemnifying party does not, within thirty days after the indemnified
party’s notice is given, give notice to the indemnified party of its election to
assume the defense of such Proceeding, the indemnifying party will be bound by
any determination made in such Proceeding or any compromise or settlement
effected by the indemnified party.

10.9 Procedure for Indemnification—Other Claims

A claim for indemnification for any matter not involving a third-party claim may
be asserted by notice to the party from whom indemnification is sought.

10.10 Reduction for Insurance, Taxes and Other Offsets

(a) The obligations of each indemnifying party hereunder regarding any Damages
will be reduced, including retroactively, by the amount of any insurance
proceeds, recognized benefit regarding Taxes (a “Tax Benefit”) or other amount
or benefit recoverable using commercially reasonable efforts by the indemnified
party regarding such Damages. If (i) the indemnified party receives from or on
behalf of an indemnifying party, or an indemnifying party pays on behalf of the
indemnified party, a payment regarding Damages, and (ii) the indemnified party
subsequently recovers insurance proceeds, Tax Benefits or any other amount or
benefit regarding such Damages, then such indemnified party will promptly pay to
the indemnifying party the amount of such insurance proceeds, Tax Benefit or
other amount or benefit, or, if less, the amount of such payment. The amount of
such insurance proceeds, Tax Benefit or other amount or benefit so recoverable
will be net of any costs and expenses incurred by the indemnified party in
procuring the same, including all reasonable out-of-pocket expenses incurred in
obtaining such recovery and net of any increase in the relevant insurance
premium directly attributable to such recovery.

(b) Each party hereby waives to the extent permitted under its (and their)
insurance policies, any subrogation rights that its (or their) insurer may have
against such indemnifying party with respect to any such Damages.

 

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10.11 Indemnification Adjusts Purchase Price for Tax Purposes

Each party will, including retroactively, treat indemnification payments under
this Agreement as adjustments to the Purchase Price for Tax purposes, except to
the extent such treatment is not permitted by applicable law.

ARTICLE 11

POST-CLOSING COVENANTS

11.1 Compliance with Agreements

From and after the Closing, Buyers will use commercially reasonably efforts to
cause the Acquired Company to continue to perform and comply with all provisions
of all (i) Contracts of the Acquired Company or (ii) Contracts under which the
Acquired Company may have rights, under which, with respect to each of (i) and
(ii), Seller or any of its Affiliates (other than the Acquired Company) may have
direct or contingent obligations.

11.2 Name Change

Upon completion of Closing, Buyers will amend the Articles of Incorporation
(Teikan) of the Acquired Company to change the name of the Acquired Company to a
name that does not include any Restricted Word. The Buyers will file the
requisite company name change documents with the applicable Governmental
Authorities on the Closing Date, if possible, and, if not, within one
(1) Business Day thereafter. Buyers will promptly provide to Seller true,
correct and complete copies of the documents filed with the applicable
Governmental Authorities to legally accomplish that name change; and Buyers
shall discontinue (and cause its Affiliates to discontinue) all uses of any
Restricted Word in connection with the operation of the business of the Acquired
Company after the Closing Date. “Restricted Word” means any of the following:
(i) the word “Marubeni” and designs and logos related thereto; (ii) any word,
design or logo that is (1) a variation of, or (2) confusingly similar to, any
item contained in clause (i); or (ii) any word, design or logo that could
reasonably be expected to imply any affiliation with Seller or any of its
Affiliates; provided, however, the Acquired Company may continue to use
Restricted Word for back office purpose only and the term “formerly known as
Marubeni Infotec” in connection with the Business of the Acquired Company.

11.3 Employee Retention

Buyers shall cause the Acquired Company to use its commercially reasonable
efforts to retain all its existing employees under their present conditions of
employment at least until December 31, 2010. Notwithstanding the foregoing,
Buyers reserve the right to cause the Acquired Company to provide for the return
of any executive level employees originally sent from Seller to the Acquired
Company, back to Seller at any time; and Seller agrees to accept such returnees.
In the event such employees are unable to be returned to Seller for reasons
beyond Seller’s control, then Seller shall reimburse the Acquired Company for
its severance costs associated with its termination of such executive employees.

 

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11.4 Other Business Matters

(a) Seller will transfer its business and operation with Asustek Computer, Adobe
and Microsoft to the Acquired Company on or before March 31, 2011; provided,
however that Seller will retain some of its non-distribution channel, Subsidiary
only business with Asustek Computer. The parties also agree to use commercially
reasonable efforts to transfer Seller’s business and operation with Sios,
Filemaker, TPV, Sigma Tech, Too, Internet Telephone, Meta Creation and Map Net
on or before March 31, 2011.

(b) Seller shall assist the Acquired Company with respect to any reasonable
request relating to pre-Closing tax filings, backup, and related documentation
and information for period of seven (7) years after the Closing.

(c) Seller shall provide such other assistance related to the Acquired Company’s
Business as reasonably requested by the Acquired Company for period one (1) year
after the Closing.

(d) With respect to the above references clause (a) through (c), the Acquired
Company shall reimburse Seller for the reasonable cost related to such services.

ARTICLE 12

GENERAL PROVISIONS

12.1 Expenses

Except as otherwise expressly provided in this Agreement, each party to this
Agreement and the Acquired Company will bear their respective expenses incurred
in connection with the preparation, execution, and performance of this Agreement
and the Contemplated Transactions, including all fees and expenses of agents,
representatives, counsel, and accountants. In the event of termination of this
Agreement, the obligation of each party and the Acquired Company to pay their
own expenses will be subject to any rights of such party arising from a breach
of this Agreement by another party.

12.2 Public Announcements

Any public announcement or similar publicity with respect to this Agreement or
the Contemplated Transactions will be issued, if at all, at such time and in
such manner as Seller and Buyers determine. Unless consented to by Buyers in
advance or required by Legal Requirements, prior to the Closing, Seller shall,
and shall cause the Acquired Company to, keep this Agreement strictly
confidential and may not make any disclosure of this Agreement to any Person.
Seller and Buyers will consult with each other concerning the means by which the
Acquired Company’s employees, customers, and suppliers and others having
dealings with the Acquired Company will be informed of the Contemplated
Transactions, and Buyers will have the right to be present for any such
communication.

12.3 Confidentiality

Between the date of this Agreement and the Closing Date, Buyers and Seller will
maintain in confidence, and will cause the directors, officers, employees,
agents, and advisors of Buyers and the Acquired Company to maintain in
confidence, and not use to the detriment

 

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of another party or an Acquired Company any written, oral, or other information
obtained in confidence from another party or an Acquired Company in connection
with this Agreement or the Contemplated Transactions, unless (a) such
information is already known to such party or to others not bound by a duty of
confidentiality or such information becomes publicly available through no fault
of such party, (b) the use of such information is necessary or appropriate in
making any filing or obtaining any consent or approval required for the
consummation of the Contemplated Transactions, or (c) the furnishing or use of
such information is required by or necessary or appropriate in connection with
legal proceedings.

If the Contemplated Transactions are not consummated, each party will return or
destroy as much of such written information as the other party may reasonably
request.

12.4 Notices

All notices or other communications required or permitted to be given hereunder
will be in writing and will be (a) delivered by hand, (b) sent by certified mail
return receipt, (c) sent by internationally recognized overnight delivery
service or (d) sent by confirmed electronic transmission. Such notices or
communications will be deemed given (i) if delivered by hand, when so delivered,
(ii) if sent by mail, the Business Day that written certification of receipt
from the relevant postal service is received by the sending party of such
notice, (iii) if sent by internationally recognized overnight courier service,
the Business Day upon which written proof of delivery from such service is made
available to or received by the sending party of such notice, or (iv) if sent by
confirmed electronic transmission, when sent by the sending party, in each case
as stated below in this Section. A party may change the address to which such
notices and other communications are to be given by giving the other parties
notice in such manner.

 

Seller: Marubeni Corporation Address: 1-4-2, Ohtemachi, Chiyoda-ku, Tokyo, Japan
100-8088 Attention: Ryoichi Watanabe Facsimile No.: 81-3-3282-4264 with a copy
to: Attention: Kenji Funaki Facsimile No.: 81-3-3282-4264 Buyers: SYNNEX
Investment Holdings Corporation Address: 44201 Nobel Drive, Fremont, California
94538 Attention: Kevin Murai Facsimile No.: (510) 360-6800 and SB Pacific
Corporation Limited Address: Unit 1628 16/F, Man Yee Bldg., 60-68 Des Voeux Rd,
               Central, Hong Kong Attention: Robert Huang, Chairman
                 Hirobumi Suzuki, Director

 

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Facsimile No.: (510) 668-3019 with a copies to: SYNNEX Corporation Address:
  44201 Nobel Drive, Fremont, California 94538 Attention: Kevin Murai,
President & CEO                  Simon Y. Leung, Senior Vice President & General
Counsel Facsimile No.: (510) 668-3707 and Pillsbury Winthrop Shaw Pittman LLP
Address:  Fuerte Kojimachi Bldg. 5F, 1-7-25, Kojimachi, Chiyoda-ku
                Tokyo, Japan 102-0083 Attention: William R. Huss, Esq. Facsimile
No.: 81-3-5226-7261

12.5 Jurisdiction; Service of Process

Any action or proceeding seeking to enforce any provision of, or based on any
right arising out of, this Agreement may be brought against any of the parties
in the courts of Japan, and each of the parties consents to the jurisdiction of
such courts (and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue laid therein. Process in any action
or proceeding referred to in the preceding sentence may be served on any party
anywhere in the world.

12.6 Further Assurances

The parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents, and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Agreement and the
documents referred to in this Agreement.

12.7 Waiver

The rights and remedies of the parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Agreement or the documents referred to in
this Agreement will operate as a waiver of such right, power, or privilege, and
no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (a) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one party,
in whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by another party; (b) no waiver that may be given by a party will
be applicable except in the specific instance for which it is given; and (c) no
notice to or demand on one party will be deemed to be a waiver of any obligation
of such party or of the right of the party giving such notice or demand to take
further action without notice or demand as provided in this Agreement or the
documents referred to in this Agreement.

 

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12.8 Entire Agreement and Modification

This Agreement supersedes all prior agreements between the parties with respect
to its subject matter (including the Letter of Intent between Buyers and Seller
dated August 6, 2010, and constitutes (along with the documents referred to in
this Agreement) a complete and exclusive statement of the terms of the agreement
between the parties with respect to its subject matter. This Agreement may not
be amended except by a written agreement executed by all of the parties hereto.

12.9 Disclosure Letter

(a) The disclosures in the Disclosure Letter, and those in any supplement
thereto, must relate only to the representations and warranties in the Section
of the Agreement to which they expressly relate and not to any other
representation or warranty in this Agreement.

In the event of any inconsistency between the statements in the body of this
Agreement and those in the Disclosure Letter (other than an exception expressly
set forth as such in the Disclosure Letter with respect to a specifically
identified representation or warranty), the statements in the body of this
Agreement will control.

12.10 Assignments, Successors, and No Third-Party Rights

No party may assign any of its rights under this Agreement without the prior
consent of the other parties except that each of the Buyers may assign any of
its rights under this Agreement to a Subsidiary of the respective Buyer. Subject
to the preceding sentence, this Agreement will apply to, be binding in all
respects upon, and inure to the benefit of the successors and permitted assigns
of the parties. Nothing expressed or referred to in this Agreement will be
construed to give any Person other than the parties to this Agreement any legal
or equitable right, remedy, or claim under or with respect to this Agreement or
any provision of this Agreement. This Agreement and all of its provisions and
conditions are for the sole and exclusive benefit of the parties to this
Agreement and their successors and assigns.

12.11 Severability

If any provision of this Agreement is held invalid or unenforceable by any court
of competent jurisdiction, the other provisions of this Agreement will remain in
full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.

12.12 Section Headings, Construction

The headings of Sections in this Agreement are provided for convenience only and
will not affect its construction or interpretation. All references to “Section”
or “Sections” refer to the corresponding Section or Sections of this Agreement.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word “including” does not limit the preceding words or terms.

 

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12.13 Time of Essence

With regard to all dates and time periods set forth or referred to in this
Agreement, time is of the essence.

12.14 Governing Law

This Agreement will be governed by the laws of Japan without regard to conflicts
of laws principles.

12.15 Counterparts

This Agreement may be executed in one or more counterparts, each of which will
be deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.

ARTICLE 13

DEFINITIONS

For purposes of this Agreement, the following terms have the meanings specified
or referred to in this Article 12:

“Accounting Arbitrator”—means KPMG Japan or other agreed upon certified public
accountant agreed to in writing by Seller and Buyers.

“Acquired Company”—as defined in the Recitals of this Agreement.

“Acquired Company’s Businesses”—means the businesses of the Acquired Company as
being conducted on the date of this Agreement and as of the Closing Date.

“Adjustment Amount”—as defined in Section 1.4.

“Ancillary Documents”—mean, with respect to a Person, any document executed and
delivered by such Person pursuant to the terms of this Agreement (but not
including this Agreement).

“Applicable Contract”—any Contract (a) under which the Acquired Company has or
may acquire any rights, (b) under which the Acquired Company has or may become
subject to any obligation or liability, or (c) by which the Acquired Company or
any of the assets owned or used by it is or may become bound, which in each case
involves a matter valued in excess of JP¥5,000,000.

“Benefit Plan”—as defined in Section 2.13.

“Buyers”—as defined in the first paragraph of this Agreement.

“Business Day”—means any day other than a Saturday, Sunday or a day that banks
in Japan are not generally authorized or required by applicable law to be
closed.

“Closing”—as defined in Section 1.3.

 

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“Closing Date”—the date and time as of which the Closing actually takes place.

“Consent”—any approval, consent, ratification, waiver, or other authorization
(including any Governmental Authorization).

“Contemplated Transactions”—all of the transactions contemplated by this
Agreement, including:

(a) the sale of the Shares by Seller to Buyers;

(b) the performance by Buyers and Seller of their respective covenants and
obligations under this Agreement;

(c) Buyers’ acquisition and ownership of the Shares and exercise of control over
the Acquired Company; and

(d) the execution, delivery and performance of the Non-Competition Agreement.

“Contract”—any agreement, contract, obligation, promise, or undertaking (whether
written or oral and whether express or implied) that is legally binding.

“Damages”—as defined in Section 10.2.

“Disclosure Letter”—the disclosure letter delivered by Seller to Buyers
concurrently with the execution and delivery of this Agreement.

“Encumbrance”—any charge, claim, community property interest, condition,
equitable interest, lien, option, pledge, security interest, right of first
refusal, or restriction of any kind, including any restriction on use, voting,
transfer, receipt of income, or exercise of any other attribute of ownership.

“Environment”—soil, land surface or subsurface strata, surface waters (including
navigable waters, ocean waters, streams, ponds, drainage basins, and wetlands),
groundwaters, drinking water supply, stream sediments, ambient air (including
indoor air), plant and animal life, and any other environmental medium or
natural resource.

“Environmental, Health, and Safety Liabilities”—any cost, damages, expense,
liability, obligation, or other responsibility arising from or under
Environmental Law or Occupational Safety and Health Law.

“Environmental Law”—any Legal Requirement applicable to the Acquired Company
that requires or relates to:

(a) advising appropriate authorities, employees, and the public of intended or
actual releases of pollutants or hazardous substances or materials, violations
of discharge limits, or other prohibitions and of the commencements of
activities, such as resource extraction or construction, that could have
significant impact on the Environment;

(b) preventing or reducing to acceptable levels the release of pollutants or
hazardous substances or materials into the Environment;

 

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(c) cleaning up pollutants that have been released, preventing the threat of
release, or paying the costs of such clean up or prevention.

“Facilities”—any real property, leaseholds, or other interests currently or
formerly owned or operated by the Acquired Company and any buildings, plants,
structures, or equipment (including motor vehicles, tank cars, and rolling
stock) currently or formerly owned or operated by the Acquired Company, in each
such case during the period in which Seller owned the Acquired Company.

“Governmental Authorization”—any approval, consent, license, permit, waiver, or
other authorization issued, granted, given, or otherwise made available by or
under the authority of any Governmental Body or pursuant to any Legal
Requirement.

“Governmental Body”—any governmental or quasi-governmental authority of any
nature (including any governmental agency, branch, department, official, or
entity and any court or other tribunal).

“Hazardous Activity”—the distribution, generation, handling, importing,
management, manufacturing, processing, production, refinement, Release, storage,
transfer, transportation, treatment, or use (including any withdrawal or other
use of groundwater) of Hazardous Materials in, on, under, about, or from the
Facilities or any part thereof into the Environment, and any other act,
business, operation, or thing that increases the danger, or risk of danger, or
poses an unreasonable risk of harm to persons or property on or off the
Facilities, or that may affect the value of the Facilities or the Acquired
Company.

“Hazardous Materials”—any waste or other substance that is listed, defined,
designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, including any admixture or solution thereof, and specifically
including petroleum and all derivatives thereof or synthetic substitutes
therefor and asbestos or asbestos-containing materials.

“Indemnified Persons”—as defined in Section 10.2.

“Intellectual Property Assets”—as defined in Section 2.22.

“Japanese GAAP”—generally accepted Japanese accounting principles, applied on a
basis consistent with the basis on which the financial statements referred to in
Section 2.4 were prepared.

“Knowledge”—an individual will be deemed to have “Knowledge” of a particular
fact or other matter if:

(a) such individual is actually aware of such fact or other matter; or

(b) a prudent individual could be expected to discover or otherwise become aware
of such fact or other matter in the course of conducting a reasonably
comprehensive investigation concerning the existence of such fact or other
matter.

A Person (other than an individual) will be deemed to have “Knowledge” of a
particular fact or other matter if any individual who is serving, or who has at
any time served,

 

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as a director, officer, partner, executor, or trustee of such Person (or in any
similar capacity) has, or at any time had, Knowledge of such fact or other
matter.

“Legal Requirement”—any federal, state, local, municipal, foreign,
international, multinational, or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.

“MF Credit Facility”—as defined in Section 2.10(b).

“MF Credit Obligation”—as defined in Section 2.10(b).

“Non-Competition Agreement”—the agreement as set forth in Exhibit A, being
entered into by Seller, Buyers and the Acquired Company.

“Occupational Safety and Health Law”—any Legal Requirement designed to provide
safe and healthful working conditions and to reduce occupational safety and
health hazards, and any program, whether governmental or private (including
those promulgated or sponsored by industry associations and insurance
companies), designed to provide safe and healthful working conditions.

“Order”—any award, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any court, administrative agency,
or other Governmental Body or by any arbitrator.

“Ordinary Course of Business”—an action taken by a Person will be deemed to have
been taken in the “Ordinary Course of Business” only if:

(a) such action is consistent with the past practices of such Person and is
taken in the ordinary course of the normal day-to-day operations of such Person;

(b) such action is not required to be authorized by the board of directors of
such Person (or by any Person or group of Persons exercising similar authority)
and is not required to be specifically authorized by the parent company (if any)
of such Person; and

(c) such action is similar in nature and magnitude to actions customarily taken,
without any authorization by the board of directors (or by any Person or group
of Persons exercising similar authority), in the ordinary course of the normal
day-to-day operations of other Persons that are in the same line of business as
such Person.

“Organizational Documents”—the current complete articles or certificate of
incorporation and the bylaws of the Acquired Company.

“Person”—any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, labor union, or other entity or
Governmental Body.

“Proceeding”—any action, arbitration, audit, hearing, investigation, litigation,
or suit (whether civil, criminal, administrative, investigative, or informal)
commenced, brought, conducted, or heard by or before, or otherwise involving,
any Governmental Body or arbitrator.

 

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“Purchase Price”—as defined in Section 1.2.

“Related Person”—with respect to a particular individual:

(a) each other member of such individual’s family;

(b) any Person that is directly or indirectly controlled by such individual or
one or more members of such individual’s family;

(c) any Person in which such individual or members of such individual’s family
hold (individually or in the aggregate) a material interest; and

(d) any Person with respect to which such individual or one or more members of
such individual’s family serves as a director, officer, partner, executor, or
trustee (or in a similar capacity).

With respect to a specified Person other than an individual:

(a) any Person that directly or indirectly controls, is directly or indirectly
controlled by, or is directly or indirectly under common control with such
specified Person;

(b) any Person that holds a material interest in such specified Person;

(c) each Person that serves as a director, officer, partner, executor, or
trustee of such specified Person (or in a similar capacity);

(d) any Person in which such specified Person holds a material interest;

(e) any Person with respect to which such specified Person serves as a general
partner or a trustee (or in a similar capacity); and

(f) any Related Person of any individual described in clause (b) or (c).

“Release”—any spilling, leaking, emitting, discharging, depositing, escaping,
leaching, dumping, or other releasing into the Environment, whether intentional
or unintentional.

“Representative”—with respect to a particular Person, any director, officer,
employee, agent, consultant, advisor, or other representative of such Person,
including legal counsel, accountants, and financial advisors.

“Seller”—as defined in the first paragraph of this Agreement.

“Shares”—as defined in the Recitals of this Agreement.

“Subsidiary”—with respect to the Acquired Company, any corporation or other
Person of which securities or other interests having the power to elect a
majority of that corporation’s or other Person’s board of directors or similar
governing body, or otherwise having the power to direct the business and
policies of that corporation or other Person.

 

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“Tax”—any tax (including any income tax, capital gains tax, value-added tax,
sales tax, property tax, gift tax, or estate or inheritance tax), levy,
assessment, tariff, duty (including any customs duty), deficiency, or other fee,
and any related charge or amount (including any fine, penalty, interest, or
addition to tax), imposed, assessed, or collected by or under the authority of
any Governmental Body or payable pursuant to any tax-sharing agreement or any
other Contract relating to the sharing or payment of any such tax, levy,
assessment, tariff, duty, deficiency, or fee.

“Tax Return”—any return (including any information return), report, statement,
schedule, notice, form, or other document or information filed with or submitted
to, or required to be filed with or submitted to, any Governmental Body in
connection with the determination, assessment, collection, or payment of any Tax
or in connection with the administration, implementation, or enforcement of or
compliance with any Legal Requirement relating to any Tax.

“Threat of Release”—a substantial likelihood of a Release that may require
action in order to prevent or mitigate damage to the Environment that may result
from such Release.

“Threatened”—a claim, Proceeding, dispute, action, or other matter will be
deemed to have been “Threatened” if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in writing), or
if any other event has occurred or any other circumstances exist, that would
lead a prudent Person to conclude that such a claim, Proceeding, dispute,
action, or other matter is likely to be asserted, commenced, taken, or otherwise
pursued in the future.

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

 

BUYERS:

 

SYNNEX INVESTMENT HOLDINGS CORPORATION

   

SELLER:

 

MARUBENI CORPORATION

/s/ Simon Y. Leung

   

/s/ Ryoichi Watanabe

Name: Simon Y. Leung

Title: SVP, Corporate Secretary and General Counsel

   

Name: Ryoichi Watanabe

Title: General Manager, IT Solution Business Dept.

SB PACIFIC CORPORATION LIMITED    

/s/ Robert T. Huang

   

Name: Robert T. Huang

Title: Chairman

   

 

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