##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended March 31, 2010

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from              to

Commission File Number: 333-134090





LOGO

Intcomex, Inc.

(Exact name of registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 65-0893400                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)

3505 NW
107thAvenue, Miami, FL 33178

(Address of principal executive offices) (Zip Code)

(305) 477-6230

(Registrants telephone number, including area code)





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of
the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.     ̈  Yes    x  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).     ̈  Yes     ̈  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.



|                        |  |   |  |                           |  |  
|----------------------- |  | - |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈ |  | Accelerated filer         |  |  ̈
|                        |  |   | 
|Non-accelerated filer   |  | x |  | Smaller reporting company |  |  ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).     ̈  Yes    x  No

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

As of May 13, 2010, the Registrant had 100,000 shares of common stock, voting, $0.01 par value, and 29,357 shares of
Class B common stock, non-voting, $0.01 par value, outstanding. There is no public trading market for the common stock.









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INTCOMEX, INC.

INDEX TO QUARTERLY REPORT ON FORM 10-Q



|                               |  |                                                                                              |  |     
|------------------------------ |  | -------------------------------------------------------------------------------------------- |  | ----
|                               |  |                                                                                              |  | Page
|PART I  FINANCIAL INFORMATION
|                               |  |                                                                                             
|Item 1.                        |  | Financial Statements.                                                                        |  |     
|                               |  |                                                                                             
|                               |  | Condensed Consolidated Balance Sheets as of March 31, 2010 and December 31, 2009             |  | 3   
|                               |  |                                                                                             
|                               |  | Condensed Consolidated Statements of Operations - Three months ended March 31, 2010 and 2009 |  | 4   
|                               |  |                                                                                             
|                               |  | Condensed Consolidated Statements of Cash Flows - Three months ended March 31, 2010 and 2009 |  | 5   
|                               |  |                                                                                             
|                               |  | Notes to Condensed Consolidated Financial Statements                                         |  | 6   
|                               |  |                                                                                             
|Item 2.                        |  | Managements Discussion and Analysis of Financial Condition and Results of Operations.       |  | 30  
|                               |  |                                                                                             
|Item 3.                        |  | Quantitative and Qualitative Disclosures About Market Risk.                                  |  | 43  
|                               |  |                                                                                             
|Item 4T.                       |  | Controls and Procedures.                                                                     |  | 43  
|                              
|PART II  OTHER INFORMATION   
|                               |  |                                                                                             
|Item 1.                        |  | Legal Proceedings.                                                                           |  | 44  
|                               |  |                                                                                             
|Item 1A.                       |  | Risk Factors.                                                                                |  | 44  
|                               |  |                                                                                             
|Item 2.                        |  | Unregistered Sales of Equity Securities and Use of Proceeds.                                 |  | 44  
|                               |  |                                                                                             
|Item 3.                        |  | Defaults Upon Senior Securities.                                                             |  | 44  
|                               |  |                                                                                             
|Item 5.                        |  | Other Information.                                                                           |  | 44  
|                               |  |                                                                                             
|Item 6.                        |  | Exhibits.                                                                                    |  | 44  
|                               | 
|Signatures                     |  | 45                                                                                          



2



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##### Table of Contents

Part I  FINANCIAL INFORMATION



|Item 1. | Financial Statements.
|------- | ---------------------

INTCOMEX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except share data)



|                                                                                                                                              |  |               |         |   |                  |   |         |  
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                                                              |  | As of         |        
|                                                                                                                                              |  | March 31,2010 |         |   | December 31,2009 |  
|                                                                                                                                              |  | (Unaudited)   |         |   |                  |  
|Assets                                                                                                                                        |  |               |         |   |                  |   |         |  
|Current assets                                                                                                                                |  |               |         |   |                  |   |         |  
|Cash and cash equivalents                                                                                                                     |  | $             | 31,196  |   |                  | $ | 27,234  |  
|Trade accounts receivable (net of allowance for doubtful accounts of $4,212 and $4,428 at March 31, 2010 and
December 31, 2009, respectively) |  |               | 104,209 |   |                  |   | 100,238 |  
|Inventories                                                                                                                                   |  |               | 123,772 |   |                  |   | 95,185  |  
|Prepaid expenses, notes receivable and other                                                                                                  |  |               | 34,197  |   |                  |   | 34,221  |  
|Due from related parties                                                                                                                      |  |               | 230     |   |                  |   | 272     |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total current assets                                                                                                                          |  |               | 293,604 |   |                  |   | 257,150 |  
|Property and equipment, net                                                                                                                   |  |               | 16,255  |   |                  |   | 16,295  |  
|Goodwill                                                                                                                                      |  |               | 13,854  |   |                  |   | 13,704  |  
|Identifiable intangible assets                                                                                                                |  |               | 1,640   |   |                  |   | 1,658   |  
|Notes receivable and other                                                                                                                    |  |               | 18,846  |   |                  |   | 19,294  |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total assets                                                                                                                                  |  | $             | 344,199 |   |                  | $ | 308,101 |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|                                                                                                                                              |  |              
|Liabilities and Shareholders Equity                                                                                                          |  |               |         |   |                  |   |         |  
|Liabilities                                                                                                                                   |  |               |         |   |                  |   |         |  
|Current liabilities                                                                                                                           |  |               |         |   |                  |   |         |  
|Lines of credit                                                                                                                               |  | $             | 17,053  |   |                  | $ | 14,729  |  
|Current maturities of long-term debt                                                                                                          |  |               | 554     |   |                  |   | 557     |  
|Accounts payable                                                                                                                              |  |               | 144,484 |   |                  |   | 117,216 |  
|Accrued expenses and other                                                                                                                    |  |               | 19,259  |   |                  |   | 13,880  |  
|Due to related parties                                                                                                                        |  |               | 75      |   |                  |   | 75      |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total current liabilities                                                                                                                     |  |               | 181,425 |   |                  |   | 146,457 |  
|Long-term debt, net of current maturities                                                                                                     |  |               | 114,621 |   |                  |   | 114,425 |  
|Other long-term liabilities                                                                                                                   |  |               | 4,466   |   |                  |   | 4,485   |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total liabilities                                                                                                                             |  |               | 300,512 |   |                  |   | 265,367 |  
|                                                                                                                                              |  |              
|Commitments and contingencies                                                                                                                 |  |               |        |   |                  |   |        |  
|                                                                                                                                              |  |              
|Shareholders equity                                                                                                                          |  |               |         |   |                  |   |         |  
|Common stock, voting $0.01 par value, 140,000 shares authorized, 100,000 issued and outstanding                                               |  |               | 1       |   |                  |   | 1       |  
|Class B common stock, non-voting $0.01 par value, 60,000 shares authorized, 29,357 issued and outstanding                                     |  |               |        |   |                  |   |        |  
|Additional paid in capital                                                                                                                    |  |               | 41,452  |   |                  |   | 41,388  |  
|Retained earnings                                                                                                                             |  |               | 5,040   |   |                  |   | 5,153   |  
|Accumulated other comprehensive loss                                                                                                          |  |               | (2,806  | ) |                  |   | (3,808  | )
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total shareholders equity                                                                                                                    |  |               | 43,687  |   |                  |   | 42,734  |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  
|Total liabilities and shareholders equity                                                                                                    |  | $             | 344,199 |   |                  | $ | 308,101 |  
|                                                                                                                                              |  |               |         |   |                  |   |         |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



3



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INTCOMEX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except share data)

(Unaudited)



|                                                                                                                      |  |                             |         |   |      |   |         |  
|--------------------------------------------------------------------------------------------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------- | -
|                                                                                                                      |  | Three Months EndedMarch 31, |        
|                                                                                                                      |  | 2010                        |         |   | 2009 |  
|Revenue                                                                                                               |  | $                           | 243,645 |   |      | $ | 204,382 |  
|                                                                                                                      |  |                            
|Cost of revenue                                                                                                       |  |                             | 219,885 |   |      |   | 183,786 |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Gross profit                                                                                                          |  |                             | 23,760  |   |      |   | 20,596  |  
|                                                                                                                      |  |                            
|Operating expenses                                                                                                    |  |                             |         |   |      |   |         |  
|Selling, general and administrative                                                                                   |  |                             | 16,895  |   |      |   | 17,055  |  
|Depreciation and amortization                                                                                         |  |                             | 1,074   |   |      |   | 1,044   |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Total operating expenses                                                                                              |  |                             | 17,969  |   |      |   | 18,099  |  
|Operating income                                                                                                      |  |                             | 5,791   |   |      |   | 2,497   |  
|                                                                                                                      |  |                            
|Other expense (income)                                                                                                |  |                             |         |   |      |   |         |  
|Interest expense                                                                                                      |  |                             | 4,889   |   |      |   | 3,834   |  
|Interest income                                                                                                       |  |                             | (92     | ) |      |   | (147    | )
|Foreign exchange loss                                                                                                 |  |                             | 469     |   |      |   | 1,638   |  
|Other expense (income), net                                                                                           |  |                             | 92      |   |      |   | (3,711  | )
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Total other expense                                                                                                   |  |                             | 5,358   |   |      |   | 1,614   |  
|Income before provision for income taxes                                                                              |  |                             | 433     |   |      |   | 883     |  
|                                                                                                                      |  |                            
|Provision for income taxes                                                                                            |  |                             | 546     |   |      |   | 870     |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Net (loss) income                                                                                                     |  | $                           | (113    | ) |      | $ | 13      |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|                                                                                                                      |  |                            
|Net (loss) income per weighted average share of common stock, voting and Class B common stock, non-voting:            |  |                             |         |   |      |   |         |  
|Basic                                                                                                                 |  | $                           | (0.87   | ) |      | $ | 0.13    |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Diluted                                                                                                               |  | $                           | (0.87   | ) |      | $ | 0.13    |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|                                                                                                                      |  |                            
|Weighted average number of common shares, voting and Class B common stock, non-voting, used in per share
calculation: |  |                             |         |   |      |   |         |  
|Basic                                                                                                                 |  |                             | 129,357 |   |      |   | 102,182 |  
|                                                                                                                      |  |                             |         |   |      |   |         |  
|Diluted                                                                                                               |  |                             | 129,357 |   |      |   | 102,182 |  
|                                                                                                                      |  |                             |         |   |      |   |         |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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INTCOMEX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)



|                                                                                                   |  |                             |         |   |      |   |        |  
|-------------------------------------------------------------------------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------ | -
|                                                                                                   |  | Three Months EndedMarch 31, |        
|                                                                                                   |  | 2010                        |         |   | 2009 |  
|Cash flows from operating activities:                                                              |  |                             |         |   |      |   |        |  
|Net (loss) income                                                                                  |  | $                           | (113    | ) |      | $ | 13     |  
|Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: |  |                             |         |   |      |   |        |  
|Stock-based compensation expense                                                                   |  |                             | 64      |   |      |   | 66     |  
|Depreciation expense                                                                               |  |                             | 956     |   |      |   | 926    |  
|Amortization expense                                                                               |  |                             | 726     |   |      |   | 600    |  
|Bad debt expense                                                                                   |  |                             | 184     |   |      |   | 801    |  
|Inventory obsolescence expense                                                                     |  |                             | 187     |   |      |   | 294    |  
|Deferred income tax expense                                                                        |  |                             | 163     |   |      |   | 188    |  
|Gain on extinguishment of long-term debt                                                           |  |                             |        |   |      |   | (3,814 | )
|(Gain) loss on disposal of property and equipment                                                  |  |                             | (9      | ) |      |   | 12     |  
|                                                                                                   |  |                            
|Change in operating assets and liabilities:                                                        |  |                             |         |   |      |   |        |  
|(Increase) decrease in:                                                                            |  |                             |         |   |      |   |        |  
|Trade accounts receivables                                                                         |  |                             | (4,155  | ) |      |   | (3,328 | )
|Inventories                                                                                        |  |                             | (28,774 | ) |      |   | 4,088  |  
|Prepaid expenses, notes receivable and other                                                       |  |                             | (115    | ) |      |   | (320   | )
|Due from related parties                                                                           |  |                             | 42      |   |      |   | 34     |  
|Increase (decrease) in:                                                                            |  |                             |         |   |      |   |        |  
|Accounts payable                                                                                   |  |                             | 27,268  |   |      |   | 5,467  |  
|Accrued expenses and other                                                                         |  |                             | 5,463   |   |      |   | (4,177 | )
|Due to related parties                                                                             |  |                             |        |   |      |   | 6      |  
|                                                                                                   |  |                             |         |   |      |   |        |  
|Net cash provided by operating activities                                                          |  |                             | 1,887   |   |      |   | 856    |  
|                                                                                                   |  |                            
|Cash flows from investing activities:                                                              |  |                             |         |   |      |   |        |  
|Purchases of property and equipment                                                                |  |                             | (919    | ) |      |   | (779   | )
|Proceeds from notes receivable                                                                     |  |                             |        |   |      |   | 61     |  
|Proceeds from disposition of assets                                                                |  |                             | 58      |   |      |   | 3      |  
|                                                                                                   |  |                             |         |   |      |   |        |  
|Net cash used in investing activities                                                              |  |                             | (861    | ) |      |   | (715   | )
|                                                                                                   |  |                            
|Cash flows from financing activities:                                                              |  |                             |         |   |      |   |        |  
|Borrowings (payments) under lines of credit, net                                                   |  |                             | 2,324   |   |      |   | (888   | )
|Proceeds from borrowings under long-term debt                                                      |  |                             |        |   |      |   | 57     |  
|Payments of long-term debt                                                                         |  |                             | (141    | ) |      |   | (2,418 | )
|                                                                                                   |  |                             |         |   |      |   |        |  
|Net cash provided by (used in) financing activities                                                |  |                             | 2,183   |   |      |   | (3,249 | )
|Effect of foreign currency exchange rate changes on cash and cash equivalents                      |  |                             | 753     |   |      |   | (280   | )
|                                                                                                   |  |                             |         |   |      |   |        |  
|Net increase (decrease) in cash and cash equivalents                                               |  |                             | 3,962   |   |      |   | (3,388 | )
|Cash and cash equivalents, beginning of period                                                     |  | $                           | 27,234  |   |      | $ | 22,344 |  
|                                                                                                   |  |                             |         |   |      |   |        |  
|Cash and cash equivalents, end of period                                                           |  | $                           | 31,196  |   |      | $ | 18,956 |  
|                                                                                                   |  |                             |         |   |      |   |        |  
|                                                                                                   |  |                            
|Supplemental disclosure of non-cash flow information                                               |  |                             |         |   |      |   |        |  
|Property and equipment acquired through financing                                                  |  | $                           |        |   |      | $ |       |  

The accompanying
notes are an integral part of the condensed consolidated financial statements.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)

Note 1.
Organization and Basis of Presentation

Nature of Operations

Intcomex, Inc. (Intcomex) is a United States (U.S.) based pure play value-added international distributor of
computer information technology (IT) products focused solely on serving Latin America and the Caribbean (the Region). Intcomex distributes computer equipment, components, peripherals, software, computer systems, accessories,
networking products and digital consumer electronics. Intcomex offers single source purchasing to its customers by providing an in-stock selection of products from vendors, including many of the worlds leading IT product manufacturers.

Organization

The accompanying unaudited condensed consolidated financial statements include the accounts of Intcomex and its subsidiaries (collectively
referred to herein as the Company) including the accounts of Intcomex Holdings, LLC (Holdings) (parent company of Software Brokers of America, Inc. (SBA), a Florida corporation), IXLA Holdings, Ltd.
(IXLA), IFC International, LLC, a Delaware limited liability company (IFC) and Intcomex International Holdings Cooperatief U.A., a Netherlands cooperative (Coop). IXLA is the Cayman Islands limited time duration
holding company of 14 separate subsidiaries located in Central America, South America and the Caribbean. IFC and Coop are the parent companies of Intcomex Holdings SPC-1, LLC (parent company of Centel, S.A. de C.V. (Intcomex Mexico or
Centel), a dually formed company in the U.S. and Mexico).

Use of Accounting Estimates

The Company prepared its unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted
in the United States of America (U.S. GAAP). The principles require the Company to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements, the reported amounts of revenues and expenses, cash flows and the related footnote disclosures during the period. On an on-going basis, the Company reviews and evaluates its estimates and assumptions,
including, but not limited to, those that relate to the realizable value of accounts receivable, inventories, identifiable intangible assets, goodwill and other long-lived assets, income taxes and contingencies. Actual results could differ from
these estimates.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to the
Quarterly Report on Form 10-Q and Article 10 of Regulation S-X, pursuant to the rules and regulations of the United States Securities and Exchange Commission (SEC). Accordingly, they do not include certain information and
disclosures normally required for comprehensive annual consolidated financial statements. Therefore, the condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes
thereto for the year ended December 31, 2009, included in the Companys Form 10-K filed with the SEC on February 22, 2010 (Annual Report). The results of operations for the three months ended March 31, 2010, may not
be indicative of the results of operations that can be expected for the full year.

In managements opinion, the
accompanying unaudited condensed consolidated financial statements reflect all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state the financial position of the Company as of March 31, 2010, and its
results of operations and its statements of cash flows for the three months ended March 31, 2010 and 2009, as applicable. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial
statements reflect the Company as the reporting entity for all periods presented.

Reclassifications

Certain reclassifications have been made to prior period balances in order to conform to the current periods presentation.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Fair Value of Financial Instruments

Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820, Fair Value
Measurements and Disclosures (ASC 820) establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received
to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following
three categories:

Level 1Quoted market prices for identical assets or liabilities in active markets or observable
inputs;

Level 2Significant other observable inputs that can be corroborated by observable market data; and

Level 3Significant unobservable inputs that cannot be corroborated by observable market data.

The carrying amounts of cash and cash equivalents, trade accounts receivable, notes and other receivables, accounts
payable, accrued expenses and other approximate fair value because of the short-term nature of these items. The carrying amounts of outstanding short-term debt approximate fair value because interest rates over the term of these financial
instruments approximate current market interest rates available to the Company. The current market price of outstanding long-term debt approximates fair value because the Companys
131/4% Second Priority Senior Secured Notes due
December 15, 2014 (the 131/4% Senior
Notes) are currently tradable under the Securities Act of 1933 Rule 144A, Private Resales of Securities to Institutions.

The amount required to enter into similar offsetting contracts with similar remaining maturities based on quoted market prices
approximates the fair value of derivative financial instruments. The Company did not have any foreign currency forward contracts outstanding as of March 31, 2010 and December 31, 2009. There were no changes to our valuation methodology for
assets and liabilities measured at fair value during the three months ended March 31, 2010.

Computation of Net (Loss) Income per
Share

The Company reports both basic and diluted net (loss) income per share. Basic net (loss) income per share excludes
dilution and is computed by dividing net (loss) income by the weighted average number of common shares outstanding during the period. Diluted net (loss) income per share is computed using the weighted average number of common shares and dilutive
potential common shares outstanding during the period. Dilutive potential common shares primarily reflect the potential dilution that could occur if stock options and other commitments to issue common stock were exercised using the treasury stock
method.

FAS ASC 260, Earnings per Share, requires that employee equity share options, non-vested shares and similar
equity instruments granted by the Company be treated as potential common shares outstanding in computing diluted net (loss) income per share. Diluted shares outstanding include the dilutive effect of in-the-money options which is calculated based on
the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has
not yet recognized, and the amount of tax benefits that would be recorded in additional paid in capital when the award becomes deductible are assumed to be used to repurchase shares.

The Company has two classes of common stock: voting and Class B, non-voting (collectively herein referred to as the Common
Stock). Common stock, voting and Class B common stock, non-voting have substantially identical rights with respect to any dividends or distributions of cash or property declared on shares of common stock and rank equally as to the right to
receive proceeds on liquidation or dissolution of the Company after the payment of the Companys indebtedness. The Company uses the two-class method for calculating net (loss) income per share. Basic and diluted net (loss) income per share of
Common Stock are the same.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



The following table sets forth the computation of basic and diluted net (loss) income
per weighted average share of Common Stock:



|                                                                                                                                           |  |                                     |         |   |      |   |        
|------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------------------------------- | ------- | - | ---- | - | -------
|                                                                                                                                           |  | For the Three Months EndedMarch 31,
|                                                                                                                                           |  | 2010                                |         |   | 2009
|Numerator for basic and diluted net (loss) income per share of Common Stock:                                                               |  |                                     |         |   |      |   |        
|Net (loss) income                                                                                                                          |  | $                                   | (113    | ) |      | $ | 13     
|                                                                                                                                           |  |                                     |         |   |      |   |        
|Denominator:                                                                                                                               |  |                                     |         |   |      |   |        
|Denominator for basic net (loss) income per share of Common Stock  weighted average shares                                                |  |                                     | 129,357 |   |      |   | 102,182
|                                                                                                                                           |  |                                     |         |   |      |   |        
|Effect of dilutive securities:                                                                                                             |  |                                     |         |   |      |   |        
|Stock options and unvested restricted
stock(1)                                                                                             |  |                                     |        |   |      |   |       
|                                                                                                                                           |  |                                     |         |   |      |   |        
|Denominator for diluted net (loss) income per common share, voting and Class B common share, non-voting - adjusted weighted
average shares |  |                                     | 129,357 |   |      |   | 102,182
|                                                                                                                                           |  |                                     |         |   |      |   |        
|                                                                                                                                           |  |                                    
|Net (loss) income per share of Common Stock:                                                                                               |  |                                     |         |   |      |   |        
|Basic                                                                                                                                      |  | $                                   | (0.87   | ) |      | $ | 0.13   
|                                                                                                                                           |  |                                     |         |   |      |   |        
|Diluted                                                                                                                                    |  | $                                   | (0.87   | ) |      | $ | 0.13   
|                                                                                                                                           |  |                                     |         |   |      |   |        



|(1) | The stock options were antidilutive during the three months ended March 31, 2010 and 2009, as the fair value was below the exercise price. The
shares of restricted common stock, non-voting were antidilutive during the three months ended March 31, 2010 and 2009.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Comprehensive Income

FASB ASC 220, Comprehensive Income, establishes standards for reporting and displaying comprehensive income (loss) and its
components in the Companys consolidated financial statements. Comprehensive income (loss) is the change in equity during a period from transactions and other events and circumstances from non-owner sources, comprised of net (loss) income and
other comprehensive income (loss). Comprehensive income (loss) consisted of the following for the periods presented:



|                                         |  |                                      |       |   |      |   |      |  
|---------------------------------------- |  | ------------------------------------ | ----- | - | ---- | - | ---- | -
|                                         |  | For the Three Months Ended March 31, |      
|                                         |  | 2010                                 |       |   | 2009 |  
|Comprehensive income (loss)              |  |                                      |       |   |      |   |      |  
|Net (loss) income                        |  | $                                    | (113  | ) |      | $ | 13   |  
|Foreign currency translation adjustments |  |                                      | 1,002 |   |      |   | (451 | )
|                                         |  |                                      |       |   |      |   |      |  
|Total comprehensive income (loss)        |  | $                                    | 889   |   |      | $ | (438 | )
|                                         |  |                                      |       |   |      |   |      |  

Foreign currency translation adjustments were driven by Centel, our operations in Mexico of $1,002 and
$(451), respectively, for the three months ended March 31, 2010 and 2009. Accumulated other comprehensive loss, consisting of cumulative foreign currency losses, included in shareholders equity totaled $(2,806) and $(3,808), respectively,
as of March 31, 2010 and December 31, 2009.



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 2. Summary of Significant Accounting Policies

Our significant accounting policies are described in Note 1 to our audited consolidated financial statements included in the
Companys Annual Report. These accounting policies have not significantly changed.

Recently Issued and Adopted Accounting Guidance

Recently Issued Accounting Guidance

In October 2009, the FASB issued Accounting Standards Update (ASU) 2009-13, Multiple-Deliverable Revenue Arrangements
(ASU 2009-13). The new standard modifies the fair value requirements of ASC 605-25, Revenue Recognition-Multiple Element Arrangementsby allowing the use of the best estimate of a selling price in addition to Vendor
Specific Objective Evidence, or VSOE, and Third Party Evidence, or TPE, for determining the selling price of a deliverable. ASU 2009-13 changes the requirements for establishing separate units of accounting in a multiple element arrangement and
requires the allocation of arrangement consideration to each deliverable to be based on the relative selling price. ASU 2009-13 is effective for revenue arrangements entered into or materially modified in fiscal years beginning on or after
June 15, 2010. The Company is currently evaluating the effect ASU 2009-13 may have on its unaudited condensed consolidated financial statements.

Recently Adopted Accounting Guidance

In August 2009, the FASB issued ASU 2009-05, Fair Value Measurements and Disclosures (Topic 820)-Measuring Liabilities at Fair Value(ASU 2009-05). ASU 2009-05 clarifies how entities should estimate the fair value of liabilities under the FASB ASC 820, Fair Value Measurements and Disclosures (formerly SFAS No. 157, Fair Value Measurements). ASU 2009-05
improves the consistency of the application of ASC 820 and reduces potential ambiguity in financial reporting when measuring the fair value of liabilities. The FASB issued ASU 2009-05 as a result of expressed concern that there may be a lack of
observable market information to measure the fair value of a liability. This standard is effective for interim and annual periods beginning after October 1, 2009, which did not have a material impact on the Companys unaudited
condensed consolidated financial statements.

In June 2009, the FASB issued ASC 810, Consolidation,(formerly SFAS
No. 167, Amendments to FASB Interpretation No. 46(R)) regarding the consolidation of variable interest entities. ASC 810 is intended to improve financial reporting by providing additional guidance to companies involved with variable
interest entities and by requiring additional disclosures about a companys involvement in variable interest entities. This standard is effective for interim and annual periods beginning after November 15, 2009, which did not have a
material impact on the Companys unaudited condensed consolidated financial statements.

In June 2009, the FASB issued
ASC 860, Transfers and Servicing (formerly SFAS No. 166, Accounting for Transfers of Financial Assets). ASC 860 requires more information about transfers of financial assets and where companies have continuing exposure to the risk
related to transferred financial assets. ASC 860 eliminates the concept of a qualifying special purpose entity, changes the requirements for derecognizing financial assets and requires additional disclosure. This standard is effective for fiscal
years beginning after November 15, 2009, which did not have a material impact on the Companys unaudited condensed consolidated financial statements.

In June 2009, the FASB issued ASC 105, Generally Accepted Accounting Principles (formerly SFAS No. 168,
The FASB Accounting Standards CodificationTMand
the Hierarchy of Generally Accepted Accounting Principles  a replacement of FASB Statement No. 162) (ASC 105). ASC 105 establishes the FASB ASC as the single source
of authoritative nongovernmental U.S. GAAP, except for SEC rules and interpretive releases, which are sources of authoritative U.S. GAAP for SEC registrants. The standard is effective for interim and annual periods ending after
September 15, 2009. The Company adopted the provisions of the standard on September 30, 2009, which did not have a material impact on the Companys unaudited condensed consolidated financial statements.

In May 2009, the FASB issued ASC 855, Subsequent Events(formerly SFAS No. 165, Subsequent Events) (ASC
855). ASC 855 establishes general accounting standards and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. ASC 855 sets forth the period after the balance
sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or
transactions occurring after the balance sheet date in its financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. ASC 855 is effective for fiscal years and
interim periods ended after June 15, 2009. The Company adopted the provisions of the standard, which had no effect on its audited consolidated financial statements and subsequent events through the date of this filing. The Company
evaluated subsequent events from April 1, 2010 to May 14, 2010, the date the Company issued its unaudited condensed consolidated financial statements.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



In April 2009, the FASB issued ASC 825, Financial Instruments(formerly
Financial Staff Position (FSP) No. 107-1 and Accounting Principles Board (APB) 28-1 (FSP No. 107-1 and APB 28-1), Interim Disclosures about Fair Value of Financial Instruments) (ASC 825). ASC 825
requires disclosures of fair value for any financial instruments not currently reflected at fair value on the balance sheet for all interim periods. ASC 825 enhances consistency in financial reporting by increasing the frequency of fair value
disclosures and is effective for interim and annual periods ending after June 15, 2009, and is to be applied prospectively. The Company adopted the provisions of the standard, which did not have an effect on its unaudited condensed consolidated
financial statements.

In April 2009, the FASB issued transition guidance ASC 820-10-65-4 Fair Value Measurements and
DisclosuresOverallTransition Guidance, the provisions of which have been incorporated in ASC 820-10-50-2 Fair Value Measurements and DisclosuresOverallDisclosures(ASC 820).ASC 820-10-50-2
requires disclosures about fair value of financial instruments for interim reporting periods and annual financial statements of publicly traded companies. This guidance is effective for interim and annual periods ending after June 15, 2009. The
Company adopted the provisions of the standard and included its effect on its unaudited condensed consolidated financial statements.

In March 2008, the FASB issued ASC 815, Derivatives and Hedging(formerly SFAS No. 161, Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement No. 133) (ASC 815). ASC 815 requires enhanced disclosures about an entitys derivative and hedging activities including how and why an entity uses, how
an entity accounts for derivative instruments; and related hedged items and how derivative instruments and related hedged items affect an entitys financial position, financial performance and cash flows. ASC 815 is effective beginning
January 1, 2009. The Company adopted the provisions of the standard and included its effect on its unaudited condensed consolidated financial statements.

In February 2008, the FASB issued ASC 820, Fair Value Measurements and Disclosures (formerly FSP Financial Accounting Standard
(FAS) No. 157-2, Effective Date of FASB Statement No. 157) which delayed the effective date for nonfinancial assets and nonfinancial liabilities until January 1, 2009. The Company adopted the provisions of the
standard as of January 1, 2009, which did not have an effect on its unaudited condensed consolidated financial statements.

In December 2007, the FASB issued ASC 805, Business Combinations (ASC 805), (formerly SFAS 141 (revised 2007),
Business Combinations).ASC 805 expands the definition of a business and a business combination; requires the acquirer to recognize the assets acquired, liabilities assumed and noncontrolling interests (including goodwill),
measured at fair value at the acquisition date; requires acquisition-related expenses and restructuring costs to be recognized separately from the business combination; and requires in-process research and development to be capitalized at fair value
as an indefinite-lived intangible asset. ASC 805 is effective for financial statements issued for fiscal years beginning after December 15, 2008. The Company adopted the provisions of the standard, which did not have an effect on its unaudited
condensed consolidated financial statements. However, if the Company enters into material business combinations in the future, a transaction may significantly impact the Companys unaudited condensed consolidated financial statements.



10



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 3. Property and Equipment, Net

Property and equipment, net consisted of the following for the periods presented:



|                                         |  |               |         |   |                  |   |         |  
|---------------------------------------- |  | ------------- | ------- | - | ---------------- | - | ------- | -
|                                         |  | As of         |        
|                                         |  | March 31,2010 |         |   | December 31,2009 |  
|Property and equipment, net              |  |               |         |   |                  |   |         |  
|Land                                     |  | $             | 735     |   |                  | $ | 735     |  
|Building and leasehold improvements      |  |               | 8,506   |   |                  |   | 8,410   |  
|Office furniture, vehicles and equipment |  |               | 11,298  |   |                  |   | 11,012  |  
|Warehouse equipment                      |  |               | 2,438   |   |                  |   | 2,438   |  
|Software                                 |  |               | 8,890   |   |                  |   | 8,337   |  
|                                         |  |               |         |   |                  |   |         |  
|Total property and equipment             |  |               | 31,867  |   |                  |   | 30,932  |  
|Less accumulated depreciation            |  |               | (15,612 | ) |                  |   | (14,637 | )
|                                         |  |               |         |   |                  |   |         |  
|Total property and equipment, net        |  | $             | 16,255  |   |                  | $ | 16,295  |  
|                                         |  |               |         |   |                  |   |         |  

Note 4. Identifiable Intangible Assets, Net and Goodwill

Identifiable Intangible Assets, Net

On June 23, 2005, the Company acquired a 100.0% interest in Centel, a distributor of IT products and peripherals located in Mexico.
In connection with the acquisition, the Company acquired $5,440 in identifiable intangible assets of Centel, including $3,630 for acquired customer relationships with a 10 year useful life, $1,080 for tradenames with a 3.5 year weighted average
useful life and $730 for non-compete agreements with a three year useful life. Centel is included as a wholly-owned subsidiary in the Companys unaudited condensed consolidated financial statements and its results of operations in the unaudited
condensed consolidated statements of operations. For the three months ended March 31, 2010 and 2009, the Company recorded amortization expense related to the intangible assets of $118. There were no impairment charges for identifiable
intangible assets for the three months ended March 31, 2010 and 2009.

Identifiable intangible assets, net consisted of
the following for the periods presented:



|                                          |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|----------------------------------------- |  | -------------------- | ----- | ----------------------- | - | ------ | --------------------------------------------- |  | - | ------------------ | - | ---------------------- | - | ----- |  | ----
|As of March 31, 2010                      |  | Gross CarryingAmount |       | AccumulatedAmortization |   |        | CumulativeForeign 
CurrencyTranslation Effect |  |   | Net CarryingAmount |   | Useful Life(in 
years)
|Identifiable intangible assets, net       |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|Customer relationships                    |  | $                    | 3,630 |                         | $ | (1,753 | )                                             |  | $ | (253               | ) |                        | $ | 1,624 |  | 10.0
|Tradenames                                |  |                      | 1,080 |                         |   | (1,062 | )                                             |  |   | (2                 | ) |                        |   | 16    |  | 3.5 
|Non-compete agreements                    |  |                      | 730   |                         |   | (730   | )                                             |  |   |                   |   |                        |   |      |  | 3.0 
|Patents                                   |  |                      | 5     |                         |   | (5     | )                                             |  |   |                   |   |                        |   |      |  |     
|                                          |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|Total identifiable intangible assets, net |  | $                    | 5,445 |                         | $ | (3,550 | )                                             |  | $ | (255               | ) |                        | $ | 1,640 |  |     
|                                          |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|                                          |  |                      |       |                         |  
|As of December 31, 2009                   |  | Gross CarryingAmount |       | AccumulatedAmortization |   |        | CumulativeForeign 
CurrencyTranslation Effect |  |   | Net CarryingAmount |   | Useful Life(in years) 
|Identifiable intangible assets, net       |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|Customer relationships                    |  | $                    | 3,630 |                         | $ | (1,662 | )                                             |  | $ | (333               | ) |                        | $ | 1,635 |  | 10.0
|Tradenames                                |  |                      | 1,080 |                         |   | (1,035 | )                                             |  |   | (22                | ) |                        |   | 23    |  | 3.5 
|Non-compete agreements                    |  |                      | 730   |                         |   | (730   | )                                             |  |   |                   |   |                        |   |      |  | 3.0 
|Patents                                   |  |                      | 5     |                         |   | (5     | )                                             |  |   |                   |   |                        |   |      |  |     
|                                          |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     
|Total identifiable intangible assets, net |  | $                    | 5,445 |                         | $ | (3,432 | )                                             |  | $ | (355               | ) |                        | $ | 1,658 |  |     
|                                          |  |                      |       |                         |   |        |                                               |  |   |                    |   |                        |   |       |  |     



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



There were no impairment charges against identifiable intangible assets for the three
months ended March 31, 2010 and 2009.

Goodwill

Goodwill represents the excess of the purchase price over the fair value of the net assets. In connection with the Companys annual
impairment test, the Company uses current market capitalization, control premiums, discounted cash flows and other factors as the best evidence of fair value and to determine if our goodwill is impaired. The impairment charge represents the extent
to which the carrying values exceed the fair value attributable to the goodwill. Fair values were determined based upon market conditions, the income approach which utilized cash flow projections and other factors.

The changes in the carrying amount of goodwill consisted of the following for the periods presented:



|                                                |  |                 |         |   |                      |   |        |       |  |   |         |  
|----------------------------------------------- |  | --------------- | ------- | - | -------------------- | - | ------ | ----- |  | - | ------- | -
|                                                |  | MiamiOperations |         |   | In-CountryOperations |   |        | Total | 
|Balance as of December 31, 2009                 |  |                 |         |   |                      |   |        |       |  |   |         |  
|Goodwill                                        |  | $               | 11,531  |   |                      | $ | 20,950 |       |  | $ | 32,481  |  
|Accumulated impairment losses                   |  |                 | (11,531 | ) |                      |   | (7,246 | )     |  |   | (18,777 | )
|                                                |  |                 |         |   |                      |   |        |       |  |   |         |  
|Total goodwill                                  |  |                 |        |   |                      |   | 13,704 |       |  |   | 13,704  |  
|Goodwill acquired during the year               |  |                 |        |   |                      |   |       |       |  |   |        |  
|Impairment losses                               |  |                 |        |   |                      |   |       |       |  |   |        |  
|Accumulated foreign currency translation effect |  |                 |        |   |                      |   | 150    |       |  |   | 150     |  
|                                                |  |                 |         |   |                      |   |        |       |  |   |         |  
|Balance as of March 31, 2010                    |  |                 |        |   |                      |   | 13,854 |       |  |   | 13,854  |  
|                                                |  |                 |        
|Goodwill                                        |  | $               | 11,531  |   |                      |   | 21,100 |       |  |   | 32,631  |  
|Accumulated impairment losses                   |  |                 | (11,531 | ) |                      |   | (7,246 | )     |  |   | (18,777 | )
|                                                |  |                 |         |   |                      |   |        |       |  |   |         |  
|Total goodwill                                  |  | $               |        |   |                      | $ | 13,854 |       |  | $ | 13,854  |  
|                                                |  |                 |         |   |                      |   |        |       |  |   |         |  

Goodwill balance was $13,854 and $13,704 as of March 31, 2010 and December 31, 2009, respectively.
The increase in the carrying amount of the goodwill relates to the cumulative foreign currency translation effect of the Mexican Peso. There were no impairment charges for goodwill for the three months ended March 31, 2010 and 2009.

In connection with the Companys goodwill impairment testing and analysis conducted in 2009, the Company noted that the fair value
of Centels goodwill exceeded the carrying amount by 3.4%. The fair value of Centel was determined using managements estimate of fair value based upon the financial projections for the business given the recent economic contraction
in Mexicos gross domestic product, or GDP. As of March 31, 2010 and December 31, 2009, the balance of Centels goodwill was $3,096 and $2,946, respectively, which represented 8.9% and 9.5%, respectively, of the carrying
amount of Centel and less than 1.0% of the Companys total assets. An extended period of economic contraction could result in a further impairment to the carrying amount of the goodwill of Centel.



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 5. Lines of Credit

The Company has lines of credit, short-term overdraft and credit facilities with various financial institutions in the countries in which
the Company conducts business. Many of the In-country Operations also have limited credit facilities. These credit facilities fall into the following categories: asset-based financing facilities, letter of credit and performance bond facilities, and
unsecured revolving credit facilities and lines of credit. The lines of credit are available sources of short-term liquidity for the Company.

The outstanding balance of lines of credits consisted of the following for the periods presented:



|                                                         |  |               |        |                  |   |       
|-------------------------------------------------------- |  | ------------- | ------ | ---------------- | - | ------
|                                                         |  | As of        
|                                                         |  | March 31,2010 |        | December 31,2009
|Lines of credit                                          |  |               |        |                  |   |       
|SBA  Miami                                              |  | $             | 10,119 |                  | $ | 9,165 
|Intcomex Peru S.A.C.                                     |  |               | 2,014  |                  |   | 2,443 
|Intcomex de Guatemala, S.A.                              |  |               | 2,000  |                  |   | 664   
|Intcomex de Ecuador, S.A.                                |  |               | 1,500  |                  |   | 1,000 
|Computación Monrenca Panama, S.A.                        |  |               | 1,097  |                  |   | 501   
|TGM S.A.  Uruguay                                       |  |               | 200    |                  |   | 714   
|Intcomex S.A. de C.V.  El Salvador                      |  |               | 71     |                  |   |      
|Intcomex Costa Rica Mayorista en Equipo de Cómputo, S.A. |  |               | 52     |                  |   | 242   
|                                                         |  |               |        |                  |   |       
|Total lines of credit                                    |  | $             | 17,053 |                  | $ | 14,729
|                                                         |  |               |        |                  |   |       

As of March 31, 2010 and December 31, 2009,
the total amounts available under the credit facilities were $16,470 and $17,055, respectively. The change in the outstanding balance was primarily attributed to increased borrowings by our subsidiary in Guatemala and SBAs increased borrowing
from its senior secured revolving credit facility. The change was also attributed to increased borrowings by our subsidiaries in Ecuador, Panama and El Salvador, to meet local working capital requirements, slightly offset by a reduction in the
borrowing requirements related to our operations in Peru, Uruguay and Costa Rica.

SBA Miami  Senior Secured Revolving Credit
Facility

On December 22, 2009, SBA closed a senior secured revolving credit facility (the Senior Secured
Revolving Credit Facility) with Comerica Bank to replace the previous revolving credit facility with a new three-year facility.

The aggregate size of the Senior Secured Revolving Credit Facility is $20,000 (with a possible increase of an additional $10,000)
including $2,000 of letter of credit commitments, and a capital expenditures limit of $1,000. The facility matures in January 2013. As of March 31, 2010, SBA had $9,681 available under the Senior Secured Revolving Credit Facility. Under the
Senior Secured Revolving Credit Facility, at SBAs option, interest is due monthly and the amounts due bear interest at the daily adjustable LIBOR rate (at no time less than 2.0%) plus 3.5%, unless in the event of a default when interest will
accrue at a rate equal to 3.0% per annum above the otherwise applicable rate. In addition, SBA will pay an administrative fee of $30 per annum and a facility fee equal to 0.5% of the aggregate amount of the revolving credit commitment, payable
quarterly in arrears. Additional customary fees will be payable upon the issuance of letters of credit.

The Senior Secured
Revolving Credit Facility contains a number of covenants that, among other things, restrict SBAs ability to (i) incur additional indebtedness; (ii) make certain capital expenditures; (iii) guarantee certain obligations;
(iv) create or allow liens on certain assets; (v) make investments, loans or advances; (vi) pay dividends, make distributions or undertake stock and other equity interest buybacks; (vii) make certain acquisitions;
(viii) engage in mergers, consolidations or sales of assets; (ix) use the proceeds of the revolving credit facility for certain purposes; (x) enter into transactions with affiliates in non-arms length transactions;
(xi) make certain payments on subordinated indebtedness; and (xii) acquire or sell subsidiaries. The Senior Secured Revolving Credit Facility also requires SBA to maintain certain ratios of debt, income, net worth and other restrictive
financial covenants.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Borrowings under the Senior Secured Revolving Credit Facility are secured on a first
priority basis with all the assets of SBA. Amounts borrowed under the facility could be repaid and re-borrowed at any time during the term of the facility. Borrowing capacity is established monthly based on certain parameters established under the
facility. Advances under the facility were provided based on 85.0% of eligible domestic and foreign accounts receivable plus 60.0% of eligible domestic inventory, less any credit facility reserves. The credit facility contained certain financial and
non-financial covenants, including but not limited to, maintenance of a minimum level of tangible effective net worth, as defined and annual limitations on capital expenditures.

As of March 31, 2010 and December 31, 2009, SBAs outstanding draws against the Senior Secured Revolving Credit Facility
were $6,422 and $5,853, respectively, and the remaining amounts available were $9,681 and $10,635, respectively. As of March 31, 2010 and December 31, 2009, SBAs outstanding checks issued in excess of bank balances were $3,697 and
$3,312, respectively, and outstanding stand-by letters of credit were $200. As of March 31, 2010 and December 31, 2009, SBA was in compliance with all of the covenants under the Senior Secured Revolving Credit Facility.

Intcomex Peru S.A.C.

Intcomex Peru S.A.C. (Intcomex Peru) has four lines of credit with two financial institutions. The lines of credit are
collateralized with a guarantee from Holdings and carry interest rates ranging from 3.0% to 7.0%, each of which matures in October 2010.

Intcomex de Guatemala, S.A.

Intcomex de Guatemala, S.A. (Intcomex Guatemala) has a line of credit with a local financial institution. The line of credit
carries an interest rate of 7.5% and matures in March 2011.

Intcomex de Ecuador, S.A.

Intcomex de Ecuador, S.A. (Intcomex Ecuador) has one line of credit with a local financial institution. The line of credit
carries an interest rate of 9.0% and matures in June 2010.

Computación Monrenca Panama, S.A.

Computación Monrenca Panama, S.A. (Intcomex Panama) has a line of credit with a local financial institutions carrying
an interest rate ranging from 6.0% to 9.0%, which matures in June 2010.

T.G.M. S.A.

TGM S.A. Uruguay (Intcomex Uruguay) has two lines of credit with local financial institutions. The lines of
credit carry an interest rate of 8.0%, each of which matures in June 2010.

Intcomex S.A. de C.V.

Intcomex S.A. de C.V. (Intcomex El Salvador) has a line of credit with a local financial institution. The line of credit
carries an interest rate of 9.0% and matures in June 2010.

Intcomex Costa Rica Mayorista en Equipo de Cómputo, S.A.

Intcomex Costa Rica Mayorista en Equipo de Cómputo, S.A. (Intcomex Costa Rica) has one line of credit with a local
financial institution. The line of credit carries an interest rate of LIBOR plus 7% and matures in August 2010.

Intcomex S.A.

As of March 31, 2010 and December 31, 2009, Intcomex S.A. (Intcomex Chile) had undrawn stand-by
letters of credit of $25,700 and $19,600, respectively.



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 6. Long-Term Debt

Long-term debt consisted of the following for the periods presented:



|                                                                                         |  |               |         |   |                  |   |         |  
|---------------------------------------------------------------------------------------- |  | ------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                         |  | As of         |        
|                                                                                         |  | March 31,2010 |         |   | December 31,2009 |  
|Long-term debt, net of current portion                                                   |  |               |         |   |                  |   |         |  
|Intcomex, Inc. 
131/4% Senior Notes, net of discount of $6,320 and $6,684, respectively |  | $             | 113,680 |   |                  | $ | 113,346 |  
|SBA  Capital lease                                                                      |  |               | 772     |   |                  |   | 847     |  
|Intcomex Peru  Collateralized notes                                                     |  |               | 542     |   |                  |   | 579     |  
|Other, including various capital leases                                                  |  |               | 181     |   |                  |   | 210     |  
|                                                                                         |  |               |         |   |                  |   |         |  
|Total long-term debt                                                                     |  |               | 115,175 |   |                  |   | 114,982 |  
|Current maturities of long-term debt                                                     |  |               | (554    | ) |                  |   | (557    | )
|                                                                                         |  |               |         |   |                  |   |         |  
|Total long-term debt, net of current portion                                             |  | $             | 114,621 |   |                  | $ | 114,425 |  
|                                                                                         |  |               |         |   |                  |   |         |  

Intcomex, Inc. 
131/4% Senior Notes

On December 10, 2009, the Company completed a private offering (the
131/4% Senior Notes Offering) to
eligible purchasers of $120,000 aggregate principal amount of its
131/4% Senior Notes due December 15, 2014 with
an interest rate of 13.25% per year, payable semi-annually on June 15 and December 15 of each year, commencing on June 15, 2010. The
131/4% Senior Notes were offered at an initial
offering price of 94.43% of par, or an effective yield to maturity of approximately 14.875%.

The Company used the net proceeds from the
131/4% Senior Notes Offering to, among other
things, repay borrowings under its previous revolving credit facility, fund the repurchase, redemption or other discharge of its
113/4% Second Priority Senior Secured Notes due
January 15, 2011 (the 113/4% Senior
Notes), for which it conducted a tender offer, and for general corporate purposes. The
131/4% Senior Notes are guaranteed by all of the
Companys existing and future domestic restricted subsidiaries that guarantee its obligations under the Senior Secured Revolving Credit Facility.

In connection with the
131/4% Senior Notes Offering, the Company and
certain subsidiaries of the Company that guaranteed the Companys obligations (the Guarantors) entered into an indenture (the 131/4% Senior Notes Indenture) with The Bank of New York Mellon Trust Company, N.A., (the Trustee), relating to the
131/4% Senior Notes. The Companys obligations
under the 131/4% Senior Notes and the
Guarantors obligations under the guarantees will be secured on a second priority basis by a lien on 100% of the capital stock of certain of the Companys and each Guarantors directly owned domestic restricted subsidiaries; 65% of
the capital stock of the Companys and each Guarantors directly owned foreign restricted subsidiaries; and substantially all the assets of SBA, to the extent that those assets secure the Companys Senior Secured Revolving Credit
Facility with Comerica Bank, subject to certain exceptions.

Subject to
certain requirements, the Company is required to redeem $5,000 aggregate principal amount of the
131/4% Senior Notes on December 15 of each of
the years 2011 and 2012 and $10,000 aggregate principal amount of the
131/4% Senior Notes on December 15, 2013, at a
redemption price equal to 100% of the aggregate principal amount of the
131/4% Senior Notes to be redeemed, together with
accrued and unpaid interest to the redemption date subject to certain requirements. The Company may redeem the
131/4% Senior Notes, in whole or in part, at any
time on or after December 15, 2012 at a price equal to 100% of the aggregate principal amount of the
131/4% Senior Notes plus a make-whole
premium (106.625% in 2012 and 100.0% in 2013 and thereafter). At any time prior to December 15, 2012, the Company is required to redeem up to 35% of the aggregate principal amount of the
131/4% Senior Notes with the net cash proceeds of
certain equity offerings if an initial public offering occurs on or prior to December 15, 2012 at a price equal to 113.25% of the principal amount of the
131/4% Senior Notes. In addition, at its option,
the Company may redeem up to 10% of the original aggregate principal amount of the
131/4% Senior Notes three different times at
$103.00 (but no more than once in any 12-month period).

On December 22, 2009, the Company, the Trustee and the Guarantors executed a second supplemental indenture (the
113/4% Senior Notes Second Supplemental
Indenture) as a result of the receipt of tenders and related consents from the holders of at least two thirds in principal amount of the
113/4% Senior Notes, in response to the
Companys tender offer and consent solicitation. The
113/4% Senior Notes Second Supplemental Indenture
amends the indenture governing the 113/4% Senior
Notes to delete or make less restrictive substantially all of the restrictive covenants contained in such indenture (other than requirements to make an offer for the
113/4% Senior Notes in the event of certain asset
sales), to delete events of default relating to covenant defaults, cross-defaults and judgments against the Company, to make conforming and related changes to the indenture, to reduce the minimum redemption notice period from 30 days to three days.



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Also on December 22, 2009, in connection with the
131/4% Senior Notes Offering, certain of the
Companys existing shareholders and their affiliates contributed $20,001 of new capital in exchange for 27,175 newly-issued shares of the Companys Class B Common Stock, non-voting, through a subscription agreement. The capital
contribution consisted of the redemption and cancellation of $15,144 face value of the
113/4% Senior Notes, $890 of tender premium paid on
the settlement of the 113/4% Senior Notes and
additional cash of $3,967.

As of March 31, 2010 and December 31, 2009, $113,680
and $113,346, respectively, of the
131/4% Senior Notes remained outstanding. As of March 31, 2010 and December 31, 2009, the Company was in compliance with all of the
covenants and restrictions under the
131/4% Senior Notes.

Intcomex, Inc. 
113/4% Senior Notes

On August 25, 2005, the Company consummated a high yield debt offering of $120,000 in aggregate principal amount
of the 113/4% Senior Notes, due January 15,
2011. The 113/4% Senior Notes were sold at 99.057
of face value and carry a coupon rate of 113/4% and
are a second priority senior secured obligation of the Company. The
113/4% Senior Notes are secured with 100.0% of the common shares of Holdings and SPC-I, 65.0% of the common shares of IXLA, with a second
priority lien on the assets of SBA. The proceeds of the offering were used to repay existing indebtedness, pay a dividend to shareholders, and pay fees and expenses associated with the debt offering with the remaining balance to be used for general
corporate purposes. On December 14, 2006, the Company completed the exchange of 100.0% of the outstanding principal of the
113/4% Senior Notes for SEC registered publicly tradable notes that have substantially identical terms and conditions as the initial notes. On
or after January 15, 2007, the Company was eligible to redeem a portion or all of the
113/4% Senior Notes.

On January 13 and 14, 2009, the Company repurchased $1,000 of its
113/4% Senior Notes in arms length
transactions on each day, at 40.00 of face value plus accrued interest. On February 11 and 23, 2009, the Company repurchased $1,500 and $1,560, respectively, of its
113/4% Senior Notes in arms length
transactions, at 36.00 of face value plus accrued interest. On March 26, 2009 and June 23, 2009, the Company repurchased $1,025 and $1,000, respectively, of its
113/4% Senior Notes in arms length
transactions, at 36.00 and 40.38, respectively of face value plus accrued interest. On July 15, 2009, the Company made a mandatory interest payment of $5,754 on its
113/4% Senior Notes.

On December 8, 2009, the Company commenced a cash tender offer for any and all of its $96,915
aggregate principal amount of 113/4% Senior Notes
which expired on January 6, 2010, unless extended or earlier terminated (the
113/4% Senior Notes Expiration Date),
to provide holders who validly tender their 113/4%
Senior Notes on December 21, 2009, unless extended or earlier terminated (the
113/4% Senior Notes Payment Deadline),
the ability to receive $1.0075 payable in cash, for each $1 principal amount of
113/4% Senior Notes accepted for payment, which
amount included a consent payment of $0.30 per $1 principal amount and accrued and unpaid interest up to, but not including, the applicable payment date. Holders of the
113/4% Senior Notes who tendered on or prior to the
113/4% Senior Notes Payment Deadline received
payment on December 22, 2009. Holders who validly tendered their
113/4% Senior Notes after the
113/4% Senior Notes Payment Deadline but on or
prior to the 113/4% Senior Notes Expiration Date
received $0.9775, payable in cash, for each $1 principal amount of
113/4% Senior Notes accepted for purchase and
accrued and unpaid interest through the applicable payment date. The
113/4% Senior Notes tendered after the
113/4% Senior Notes Payment Deadline but before the
113/4% Senior Notes Expiration Date received
payment promptly following the expiration of the offer. The Company financed the tender offer with the net cash proceeds of the new
131/4% Senior Notes Offering. The closing of the
tender offer was conditioned, among other things, on the Companys successful completion of the 131/4% Senior Notes Offering.

The Company recognized a gain on the repurchase of its
113/4% Senior Notes of $3,814 for the three months
ended March 31, 2009, which is included in other expense (income), net in the consolidated statements of operations. The Company did not repurchase any of its
113/4% Senior Notes and did not recognize a gain
for the three months ended March 31, 2010. As of March 31, 2010, there were no
113/4% Senior Notes outstanding. As of December 31, 2009, $1,400 of the
113/4% Senior Notes not tendered in the early tender redemption period remained outstanding and were redeemed through payment to the Trustee for
settlement on January 15, 2010, in accordance with the terms of the
113/4% Senior Notes Second Supplemental Indenture.
As of December 31, 2009, the Company was in compliance with all of the covenants and restrictions under the 113/4% Senior Notes.



16



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



SBA  Capital lease

On April 30, 2007, SBA entered into a lease agreement with Comerica Bank in the principal amount of $1,505 for the lease of the Miami
office and warehouse equipment. Interest is due monthly at 6.84% of the total equipment costs and all outstanding amounts are due April 30, 2012. As of March 31, 2010 and December 31, 2009, $772 and $847, respectively, remained
outstanding under the lease agreement.

Note 7. Income Taxes

Income tax provision consists of the following for the periods presented:



|                            |  |                                     |     |   |      |   |    
|--------------------------- |  | ----------------------------------- | --- | - | ---- | - | ---
|                            |  | For the Three MonthsEnded March 31,
|                            |  | 2010                                |     |   | 2009
|Income tax provision        |  |                                     |     |   |      |   |    
|Current expense:            |  |                                     |     |   |      |   |    
|Federal and state           |  | $                                   | 63  |   |      | $ | 8  
|Foreign                     |  |                                     | 321 |   |      |   | 674
|                            |  |                                     |     |   |      |   |    
|Total current expense       |  |                                     | 384 |   |      |   | 682
|                            |  |                                     |     |   |      |   |    
|Deferred (benefit) expense: |  |                                     |     |   |      |   |    
|Federal and state           |  |                                     | (63 | ) |      |   | 160
|Foreign                     |  |                                     | 225 |   |      |   | 28 
|                            |  |                                     |     |   |      |   |    
|Total deferred benefit      |  |                                     | 162 |   |      |   | 188
|                            |  |                                     |     |   |      |   |    
|Total income tax provision  |  | $                                   | 546 |   |      | $ | 870
|                            |  |                                     |     |   |      |   |    

A reconciliation of the statutory federal income tax
rate and effective rate as a percentage of income before provision for income taxes consisted of the following for the periods presented:



|                                                                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|----------------------------------------------------------------- |  | ------------------------------------ | ------ | - | - | ---- | -- | ---- | - | --- |  | -- | -
|                                                                  |  | For the Three Months Ended March 31, |       
|                                                                  |  | 2010                                 |        |   | % |      |    | 2009 |   | %   | 
|Effective tax rate                                                |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|(Loss) income before provision for income taxes:                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|U.S.                                                              |  | $                                    | (3,528 | ) |   |      |    |      | $ | 315 |  |    |  
|Foreign                                                           |  |                                      | 3,961  |   |   |      |    |      |   | 568 |  |    |  
|                                                                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|Income before provision for income taxes                          |  | $                                    | 433    |   |   |      |    |      | $ | 883 |  |    |  
|                                                                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|Tax at statutory rate                                             |  | $                                    | 147    |   |   | 34   | %  |      | $ | 300 |  | 34 | %
|State income taxes, net of federal income tax (benefit) provision |  |                                      | (95    | ) |   | (22  | )% |      |   | 18  |  | 2  | %
|Effect of tax rates from non-U.S. operations                      |  |                                      | (585   | ) |   | (135 | )% |      |   | 507 |  | 57 | %
|Change in valuation allowance                                     |  |                                      | 1,079  |   |   | 249  | %  |      |   | 45  |  | 5  | %
|                                                                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  
|Effective tax provision                                           |  | $                                    | 546    |   |   | 126  | %  |      | $ | 870 |  | 98 | %
|                                                                  |  |                                      |        |   |   |      |    |      |   |     |  |    |  

Our effective tax rate was 126% and 98% for the three months ended March 31, 2010 and 2009,
respectively. The increase in the effective tax rate was primarily due to the increase in the valuation allowance related to the additional NOLs generated from our Miami Operations and higher taxable earnings in several of our foreign operations.



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



The Companys net deferred tax assets were attributable to the following for the
periods presented:



|                                |  |                     |        |   |                        |   |        |  
|------------------------------- |  | ------------------- | ------ | - | ---------------------- | - | ------ | -
|                                |  | As
ofMarch 31, 2010 |        |   | As ofDecember 31, 2009 |  
|Deferred tax assets             |  |                     |        |   |                        |   |        |  
|Current assets:                 |  |                     |        |   |                        |   |        |  
|Allowance for doubtful accounts |  | $                   | 988    |   |                        | $ | 1,053  |  
|Inventories                     |  |                     | 601    |   |                        |   | 633    |  
|Accrued expenses                |  |                     | 340    |   |                        |   | 738    |  
|Other                           |  |                     | 237    |   |                        |   | 140    |  
|                                |  |                     |        |   |                        |   |        |  
|Total current assets            |  |                     | 2,166  |   |                        |   | 2,564  |  
|                                |  |                     |        |   |                        |   |        |  
|                                |  |                    
|Non-current assets:             |  |                     |        |   |                        |   |        |  
|Tax goodwill                    |  |                     | 803    |   |                        |   | 864    |  
|Net operating losses            |  |                     | 16,673 |   |                        |   | 15,520 |  
|Other                           |  |                     | 1,283  |   |                        |   | 1,164  |  
|Valuation allowances            |  |                     | (7,511 | ) |                        |   | (6,432 | )
|                                |  |                     |        |   |                        |   |        |  
|Total non-current assets        |  |                     | 11,248 |   |                        |   | 11,116 |  
|                                |  |                     |        |   |                        |   |        |  
|Total deferred tax assets       |  | $                   | 13,414 |   |                        | $ | 13,680 |  
|                                |  |                     |        |   |                        |   |        |  
|                                |  |                    
|Deferred tax liabilities        |  |                     |        |   |                        |   |        |  
|Current liabilities:            |  |                     |        |   |                        |   |        |  
|Inventories                     |  | $                   | (195   | ) |                        | $ | (231   | )
|                                |  |                     |        |   |                        |   |        |  
|Total current liabilities       |  |                     | (195   | ) |                        |   | (231   | )
|                                |  |                     |        |   |                        |   |        |  
|                                |  |                    
|Non-current liabilities:        |  |                     |        |   |                        |   |        |  
|Fixed assets                    |  |                     | (1,859 | ) |                        |   | (1,923 | )
|Amortizable intangible assets   |  |                     | (580   | ) |                        |   | (614   | )
|Inventories                     |  |                     | (277   | ) |                        |   | (246   | )
|                                |  |                     |        |   |                        |   |        |  
|Total non-current liabilities   |  |                     | (2,716 | ) |                        |   | (2,783 | )
|                                |  |                     |        |   |                        |   |        |  
|Total deferred tax liabilities  |  |                     | (2,911 | ) |                        |   | (3,014 | )
|                                |  |                     |        |   |                        |   |        |  
|Net deferred tax assets         |  | $                   | 10,503 |   |                        | $ | 10,666 |  
|                                |  |                     |        |   |                        |   |        |  

As of March 31, 2010 and December 31, 2009, the balance of SBAs tax goodwill was $2,133 and
$2,297, respectively. SBA recorded tax goodwill of approximately $9,843 in July 1998, which is being amortized for tax purposes over 15 years. SBA established $262 of deferred tax assets for foreign withholding taxes paid in El Salvador during 2005.

As of March 31, 2010 and December 31, 2009, the Companys U.S. federal and state of Florida net operating
losses (NOLs) resulted in $14,290 and $13,271, respectively, of deferred tax assets, which will begin to expire in 2026. The Company analyzed the available evidence related to the realization of the deferred tax assets, considered the
current downturn in the recent global economic environment and determined it is now more likely than not that the Company will not recognize a portion of its deferred tax assets associated with the NOL carryforwards. Factors in managements
determination include the performance of the business and the feasibility of ongoing tax planning strategies.

As of
March 31, 2010 and December 31, 2009, the Company recorded a valuation allowance of $7,511 and $6,432, respectively, against the respective NOLs, of which $5,521 and $4,467, respectively, related to the U.S. and $1,990 and $1,965 and,
related to our In-country Operations, as management did not believe that it would fully realize their full benefit at this time.

As of March 31, 2010 and December 31, 2009, Intcomex Argentina S.R.L. (Intcomex Argentina) had $4,023 in NOLs
resulting in $1,433 and $1,408, respectively, of deferred tax assets, which will begin to expire in 2011. As of March 31, 2010 and December 31, 2009, the Company recorded a valuation allowance of $1,433 and $1,408, respectively against
these NOLs, as management does not believe that it will realize their full benefit at this time.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



As of March 31, 2010 and December 31, 2009, Intcomex Mexico had $1,096 in NOLs
resulting in $307 of deferred tax assets, which will expire in 2018. As of March 31, 2010 and December 31, 2009, the Company recorded a $307 valuation allowance against this NOL, as management does not believe that it will realize their
full benefit at this time.

As of March 31, 2010 and December 31, 2009, Intcomex Colombia LTDA (Intcomex
Colombia) had $830 in NOLs resulting in $275 of deferred tax assets related to a NOL carryforward. Management established a $250 valuation allowance against the deferred tax assets pending Intcomex Colombias further growth in taxable
income. Colombia allows for an eight year carryforward on NOLs, which expires in 2013.

As of March 31, 2010 and
December 31, 2009, the Company did not recognize any subpart F income related to intercompany loans from its foreign affiliates. As of March 31, 2010, the Company did not recognize any subpart F income. As of December 31, 2009, the
Company recognized $3,248 in subpart F income, as the Company considers this a one-time event and therefore, did not provide additional tax provisions for future realization of subpart F income.

The Companys NOLs consisted of the following for the periods presented:



|                       |  |                      |        |                         |   |                    |  |          |       |                       |   |                    |  |   |        |  |   |      
|---------------------- |  | -------------------- | ------ | ----------------------- | - | ------------------ |  | -------- | ----- | --------------------- | - | ------------------ |  | - | ------ |  | - | -----
|                       |  | As of March 31, 2010 |        | As of December 31, 2009
|                       |  | GrossNOL             |        | NOL-DeferredTax Asset   |   | ValuationAllowance |  | GrossNOL |       | NOL-DeferredTax Asset |   | ValuationAllowance
|U.S. federal and state |  | $                    | 37,776 |                         | $ | 14,290             |  | $        | 5,521 |                       | $ | 34,723             |  | $ | 13,271 |  | $ | 4,467
|Foreign                |  |                      |        |                         |   |                    |  |          |       |                       |   |                    |  |   |        |  |   |      
|Intcomex Argentina     |  |                      | 4,023  |                         |   | 1,433              |  |          | 1,433 |                       |   | 4,023              |  |   | 1,408  |  |   | 1,408
|Intcomex Colombia      |  |                      | 830    |                         |   | 275                |  |          | 250   |                       |   | 830                |  |   | 275    |  |   | 250  
|Intcomex Jamaica Ltd.  |  |                      | 839    |                         |   | 279                |  |          |      |                       |   | 720                |  |   | 251    |  |   |     
|Intcomex Mexico        |  |                      | 1,096  |                         |   | 307                |  |          | 307   |                       |   | 1,096              |  |   | 307    |  |   | 307  
|                       |  |                      |        |                         |   |                    |  |          |       |                       |   |                    |  |   |        |  |   |      
|Total foreign          |  |                      | 6,788  |                         |   | 2,294              |  |          | 1,990 |                       |   | 6,669              |  |   | 2,241  |  |   | 1,965
|                       |  |                      |        |                         |   |                    |  |          |       |                       |   |                    |  |   |        |  |   |      
|Total                  |  | $                    | 44,564 |                         | $ | 16,584             |  | $        | 7,511 |                       | $ | 41,392             |  | $ | 15,512 |  | $ | 6,432
|                       |  |                      |        |                         |   |                    |  |          |       |                       |   |                    |  |   |        |  |   |      

The undistributed earnings in foreign subsidiaries are
permanently invested abroad and will not be repatriated to the U.S. in the foreseeable future. Because they are considered to be indefinitely reinvested, no U.S. federal or state deferred income taxes have been provided on these earnings. Upon
distribution of those earnings, in the form of dividends or otherwise, we would be subject to both U.S. income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to the various foreign countries in which we
operate. Because of the availability of U.S. foreign tax credits, it is not practicable to determine the U.S. foreign income tax liability that would be payable if such earnings were not reinvested indefinitely.

The Company files tax returns in the U.S., the state of Florida and in various foreign jurisdictions in which the Company conducts
business throughout Latin America and the Caribbean. The IRS examined the 2004 and 2005 tax returns and concluded that there were no changes to the returns. Tax years 2006, 2007 and 2008 remain open for examination by the Florida Department of
Revenue and the IRS.

The Company is subject to periodic audits by foreign, domestic and state tax authorities. By statute,
the Companys U.S. federal returns are subject to examination by the IRS for fiscal years 2006 through 2008. The Company believes its accruals for tax liabilities are adequate for all open fiscal years based upon an assessment of factors,
including but not limited to, historical experience and related tax law interpretations. The Company does not anticipate that the total amount of unrecognized tax benefits related to any particular tax position will change significantly within the
next 12 months.

The Company classifies tax liabilities that are expected to be paid within the current year, if any, as
current income tax liabilities and all other uncertain tax positions as non-current income tax liabilities. The Company recognizes interest and penalties related to income tax matters in income tax expense.



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 8. Fair Value of Derivative Instruments

The Company accounts for derivative instruments and hedging activities in accordance with FASB ASC 815, Derivatives and Hedging.The Company is exposed to certain risks related to its ongoing business operations. The Company enters into forward contracts on foreign currencies to manage its primary risks including foreign currency price risk associated with forecasted
purchases of inventory used in the Companys normal business activities. The Company provides enhanced disclosures of its derivative instruments including how and why it uses derivative instruments, how it accounts for derivative
instruments and related hedged items and how derivative instruments and related hedged items affect the Companys financial position, financial performance and cash flows.

All derivative instruments are recorded in the Companys consolidated balance sheet at fair value which represents the amount
required to enter into similar offsetting contracts with similar remaining maturities based on quoted market prices. The notional amount of forward exchange contracts is the amount of foreign currency bought or sold at maturity and is indicative of
the extent of the Companys involvement in the various types and uses of derivative instruments, but not a measure of the Companys exposure to credit or market risks through its use of derivative instruments.

There were no derivative instruments outstanding as of March 31, 2010 and December 31, 2009.

Note 9. Share-Based Compensation

The Company recognizes compensation expense for its share-based compensation plans utilizing the modified prospective method for awards
issued, modified, repurchased or canceled under the provisions of FASB ASC 718, Compensation-Stock Compensation. Share-based compensation expense is based on the fair value of the award and measured at grant date, recognized as an expense in
earnings over the requisite service period and is recorded in salaries, wages and benefits in the consolidated statements of operations as part of selling, general and administrative expenses.

Total compensation expense for share-based compensation arrangements charged against income were $64 and $66, respectively, for the three
months ended March 31, 2010 and 2009. Compensation expense of $45 and $54, respectively, related to the stock options issued pursuant to the 2007 Founders Grant Stock Option Plan (the 2007 Founders Option Plan) and $19
and $12 respectively, related to the restricted shares of Class B common stock, non-voting, issued pursuant to the 2008 Restricted Stock Issuances was charged against income during the three months ended March 31, 2010 and 2009.

As of March 31, 2010 and December 31, 2009, there were $139 and $203, respectively, of total outstanding compensation costs for
unvested share-based compensation arrangements, of which $11 and $56, respectively, related to the stock options and $128 and $147, respectively, related to the restricted shares of Class B common stock, non-voting. These compensation costs will be
recognized over a weighted average period of 2.0 years.

Stock Options

In February 2007, options to acquire an aggregate of 1,540 shares of Class B common stock, non-voting were granted under the 2007
Founders Option Plan to certain management employees and independent, non-employee directors. The options were granted at an exercise price of $1,077 per share, which was equal to the fair value of our common stock on the date of grant. The
weighted-average grant date fair value of the options granted during the year ended December 31, 2007 was $566 per share. The shares vest ratably over a three year vesting period of one-third per year on the annual anniversary date and expire
10 years from the date of grant. There were no stock options granted during the three months ended March 31, 2010 and 2009. As of March 31, 2010, all of the outstanding options were vested.



20



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



A summary of the stock option activity under the 2007 Founders Option Plan and
changes during the periods presented, consisted of the following:



|                                              |  |        |   |  |                                                      |       |                                                     |    
|--------------------------------------------- |  | ------ | - |  | ---------------------------------------------------- | ----- | --------------------------------------------------- | ---
|                                              |  | Shares |   |  | Weighted-AverageExercise 
Priceper Share(in dollars) |       | Weighted-AverageRemainingContractual Term(in years)
|Outstanding at January 1, 2008                |  | 1,540  |   |  | $                                                    | 1,077 |                                                     | 9.2
|Granted                                       |  |       |   |  |                                                      |      |                                                     |    
|Exercised                                     |  |       |   |  |                                                      |      |                                                     |    
|Forfeited or expired                          |  | (50    | ) |  |                                                      |      |                                                     |    
|                                              |  |        |   |  |                                                      |       |                                                     |    
|Outstanding at December 31, 2008              |  | 1,490  |   |  | $                                                    | 1,077 |                                                     | 8.2
|                                              |  |        |  
|Granted                                       |  |       |   |  |                                                      |      |                                                     |    
|Exercised                                     |  |       |   |  |                                                      |      |                                                     |    
|Forfeited or expired                          |  | (210   | ) |  | $                                                    | 1,077 |                                                     |    
|                                              |  |        |   |  |                                                      |       |                                                     |    
|Outstanding at December 31, 2009              |  | 1,280  |   |  | $                                                    | 1,077 |                                                     | 7.2
|                                              |  |        |  
|Granted                                       |  |       |   |  |                                                      |      |                                                     |    
|Exercised                                     |  |       |   |  |                                                      |      |                                                     |    
|Forfeited or expired                          |  |       |   |  |                                                      |      |                                                     |    
|                                              |  |        |   |  |                                                      |       |                                                     |    
|Outstanding at March 31, 2010                 |  | 1,280  |   |  | $                                                    | 1,077 |                                                     | 6.9
|                                              |  |        |   |  |                                                      |       |                                                     |    
|Vested and expected to vest at March 31, 2010 |  | 1,280  |   |  | $                                                    | 1,077 |                                                     | 6.9
|                                              |  |        |   |  |                                                      |       |                                                     |    
|Exercisable at March 31, 2010                 |  | 1,280  |   |  | $                                                    | 1,077 |                                                     | 6.9
|                                              |  |        |   |  |                                                      |       |                                                     |    

The options were antidilutive as of March 31,
2010 and December 31, 2009, as the fair value of the options was below the exercise price of the options. The fair value of the options was determined using the Black-Scholes option pricing model as of April 23, 2007, the measurement date
or the date the Company received unanimous approval from shareholders for the 2007 Founders Option Plan. The Black-Scholes option pricing model was developed for use in estimating the fair value of traded options. This model requires the input
of subjective assumptions, including expected price volatility and term. Changes in these subjective assumptions can materially affect the fair value of the estimate, and therefore, existing valuation models do not provide a precise measure of the
fair value of the Companys employee stock options. Projected data related to the expected volatility and expected life of stock options is typically based upon historical and other information. The fair value of the options granted in 2007 was
estimated at the date of grant using the following assumptions:



|                          |  |         |  
|------------------------- |  | ------- | -
|Expected term             |  | 6 years |  
|Expected volatility       |  | 37.00   | %
|Dividend yield            |  | 0.00    | %
|Risk-free investment rate |  | 4.58    | %

The expected
term of the options granted under the 2007 Founders Option Plan is based on the simplified method for estimating the expected life of the options, as historical data related to the expected life of the options is not available. The Company
used the historical volatility of the industry sector index, as it is not practicable to estimate the expected volatility of the Companys share price. The risk-free investment rate for periods within the contractual life of the option is based
on the U.S. Treasury yield curve of the same maturity in effect at the time of grant. The Company estimates forfeitures in calculating the expense relating to stock-based compensation. At the grant date, the Company estimated the number of shares
expected to vest and will subsequently adjust compensation costs for the estimated rate of forfeitures on an annual basis. The Company will use historical data to estimate option exercise and employee termination in determining the estimated
forfeiture rate. The estimated forfeiture rate applied as of the option grant date was 1%.



21



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Restricted Shares of Common Stock

In February 2008, our Board of Directors authorized, and in June 2008, our shareholders approved the issuance of 73 restricted shares of
Class B common stock, non-voting, with a three year cliff vesting period to our director Mr. Henriques, as the initial equity consideration for his election to the Board of Directors and 41 restricted shares of Class B common stock, non-voting,
with a three year cliff vesting period to each of our director Mr. Madden and our former director Ms. Miltner, as annual equity consideration for their board membership (collectively the 2008 Restricted Stock Issuances). In
January 2009, Ms. Miltner surrendered her right to the restricted shares of Class B common stock, non-voting, in accordance with the terms of her resignation agreement with the Company.

In May 2009, our Board of Directors authorized and our shareholders approved the issuance of 96 restricted shares of Class B common
stock, non-voting, with a three year cliff vesting period to each of our directors Messrs. Henriques and Madden, as annual equity consideration for their board membership (collectively the 2009 Restricted Stock Issuance).

In September 2009, our Board of Directors approved, subject to shareholder approval, the designation of an additional 1,000 shares of
Class B common stock, non-voting, to be reserved for the grant of restricted stock to our Board of Directors.

The Company did
not grant any restricted shares of common stock during the three months ended March 31, 2010 and 2009.

A summary of the
unvested restricted shares of Class B common stock, non-voting award activity under the 2008 Restricted Stock Issuances and 2009 Restricted Stock Issuance and changes during the periods presented consisted of the following:



|                                      |  |                                               |   |  |                                                           |       |    
|------------------------------------- |  | --------------------------------------------- | - |  | --------------------------------------------------------- | ----- | ---
|                                      |  | RestrictedCommon 
Stock,Non-voting(in shares) |   |  | Weighted-AverageGrant-DateFair Valueper Share(in
dollars) |      
|Unvested Balance at January 1, 2009   |  | 155                                           |   |  | $                                                         | 1,225 | (1)
|Granted                               |  | 192                                           |   |  | $                                                         | 521   | (2)
|Vested                                |  |                                              |   |  |                                                           |      |    
|Forfeited                             |  | (41                                           | ) |  | $                                                         | 1,225 |    
|                                      |  |                                               |   |  |                                                           |       |    
|Unvested Balance at December 31, 2009 |  | 306                                           |   |  | $                                                         | 1,040 | (3)
|                                      |  |                                               |   |  |                                                           |       |    
|Granted                               |  |                                              |   |  |                                                           |      |    
|Vested                                |  |                                              |   |  |                                                           |      |    
|Forfeited                             |  |                                              |   |  |                                                           |      |    
|                                      |  |                                               |   |  |                                                           |       |    
|Unvested Balance at March 31, 2010    |  | 306                                           |   |  | $                                                         | 1,040 | (3)
|                                      |  |                                               |   |  |                                                           |       |    



|(1) | The fair value was estimated by the Company on the date the Company received unanimous shareholder approval of the grant.
|--- | -------------------------------------------------------------------------------------------------------------------------

|(2) | The fair value was determined as of the date the Company received unanimous shareholder approval of the grant.
|--- | --------------------------------------------------------------------------------------------------------------

|(3) | The fair value was determined using the weighted-average fair value per share to reflect the portion of the period during which shares were outstanding.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 10. Commitments and Contingencies and Other

Commitments and Contingencies

The Company accrues for contingent obligations when the obligation is probable and the amount is reasonably estimable. As facts concerning
contingencies become known, we reassess our position and make appropriate adjustments to the financial statements. Estimates that require judgment and are particularly sensitive to future changes include those related to taxes, legal matters, the
imposition of international governmental monetary, fiscal or other controls, changes in the interpretation and enforcement of international laws (in particular related to items such as duty and taxation), and the impact of local economic conditions
and practices, which are all subject to change as events evolve and as additional information becomes available.

Litigation

As part of our normal course of business, we are involved in certain claims, regulatory and tax matters. In the opinion of
our management, the final disposition of such matters will not have a material adverse impact on our results of operations and financial condition.

Contingent Liability

The Company is subject to inspection by the tax authorities in the foreign jurisdictions in which the Company conducts business for
various statutes of limitations under the applicable law.

Leases

The Company leases office, warehouse facilities, and warehouse equipment under non-cancelable operating leases, including a 10-year lease
for 221,021 square feet of office and warehouse space in Miami, Florida. The commencement date of the lease was May 1, 2007, with a base rent expense of $146 and an annual 3.0% escalation clause.

Note 11. Additional Paid in Capital

As of March 31, 2010 and December 31, 2009, additional paid in capital was $41,452 and $41,388, respectively.

Total compensation expense for share-based compensation arrangements charged against income was $64 and $66 for the three months ended
March 31, 2010 and 2009, respectively. For a detailed discussion of the share-based compensation, see Note 9. Share-Based Compensation in these Notes to Condensed Consolidated Financial Statements.

For the year ended December 31, 2009, the Company recorded additional paid in capital of $20,001 related to its
shareholder subscription offering consummated on December 22, 2009. Certain of the Companys existing shareholders and their affiliates contributed $20,001 of new capital in exchange for 27,175 newly-issued shares of our Class B Common
Stock, non-voting, through a subscription agreement. The capital contribution consisted of the redemption and cancellation of $15,144 face value of the
113/4% Senior Notes, $890 of tender premium paid on
the settlement of the 113/4% Senior Notes and
additional cash of $3,967.

Note 12. Segment Information

FASB ASC 280, Segment Reportingprovides guidance on the disclosures about segments and information related to reporting units. The
Company operates in a single industry segment, that being a distributor of IT products. The Companys operating segments are based on geographic location. Geographic areas in which the Company operates include sales generated from and invoiced
by the Miami, Florida operations, the Miami Operations and sales generated from and invoiced by all of the Latin American and Caribbean subsidiary operations. The subsidiary operations conduct business with sales and distribution centers in the
following countries: Argentina, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Jamaica, Mexico, Panama, Peru, and Uruguay and a sales office in Brazil, collectively, our In-country Operations. The In-country Operations have been
aggregated as one segment due to similar products and economic characteristics. The Company sells and distributes one type of product line, IT products and does not provide any separately billable services. It is impracticable for the Company to
report the revenues from external customers for the group of similar products within the product line because the general ledger used to prepare the Companys financial statements does not track sales by product.



23



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Inter-segment revenue primarily represents intercompany revenue between the Miami
Operations and the In-country Operations at established prices. Intercompany revenue between the related companies is eliminated in consolidation. The measure for the Companys segment profit is operating income. Financial information by
geographic operating segment is as follows for the periods presented:



|                                                |  |                                      |         |   |                        |   |         |  
|----------------------------------------------- |  | ------------------------------------ | ------- | - | ---------------------- | - | ------- | -
|                                                |  | For the Three Months Ended March 31, |        
|                                                |  | 2010                                 |         |   | 2009                   |  
|                                                |  |                                     
|Statement of Operations Data:                   |  |                                      |         |   |                        |   |         |  
|Revenue                                         |  |                                      |         |   |                        |   |         |  
|Miami Operations                                |  |                                      |         |   |                        |   |         |  
|Revenue to unaffiliated
customers(1)            |  | $                                    | 59,416  |   |                        | $ | 55,007  |  
|Intersegment                                    |  |                                      | 78,148  |   |                        |   | 53,591  |  
|                                                |  |                                      |         |   |                        |   |         |  
|Total Miami Operations                          |  |                                      | 137,564 |   |                        |   | 108,598 |  
|In-country Operations                           |  |                                      |         |   |                        |   |         |  
|In-country Operations, excluding Intcomex Chile |  |                                      | 126,735 |   |                        |   | 112,552 |  
|Intcomex Chile                                  |  |                                      | 57,494  |   |                        |   | 36,823  |  
|                                                |  |                                      |         |   |                        |   |         |  
|In-country Operations                           |  |                                      | 184,229 |   |                        |   | 149,375 |  
|Eliminations of inter-segment                   |  |                                      | (78,148 | ) |                        |   | (53,591 | )
|                                                |  |                                      |         |   |                        |   |         |  
|Total revenue                                   |  | $                                    | 243,645 |   |                        | $ | 204,382 |  
|                                                |  |                                      |         |   |                        |   |         |  
|Operating income                                |  |                                      |         |   |                        |   |         |  
|Miami Operations                                |  | $                                    | 1,136   |   |                        | $ | 124     |  
|In-country Operations                           |  |                                      | 4,655   |   |                        |   | 2,373   |  
|                                                |  |                                      |         |   |                        |   |         |  
|Total operating income                          |  | $                                    | 5,791   |   |                        | $ | 2,497   |  
|                                                |  |                                      |         |   |                        |   |         |  
|                                                |  |                                     
|                                                |  | As
ofMarch 31, 2010                  |         |   | As ofDecember 31, 2009 |  
|                                                |  |                                     
|Balance Sheet Data:                             |  |                                      |         |   |                        |   |         |  
|Assets                                          |  |                                      |         |   |                        |   |         |  
|Miami Operations                                |  | $                                    | 144,882 |   |                        | $ | 126,440 |  
|In-country Operations                           |  |                                      |         |   |                        |   |         |  
|In-country Operations, excluding Intcomex Chile |  |                                      | 107,905 |   |                        |   | 98,342  |  
|Intcomex Chile                                  |  |                                      | 91,412  |   |                        |   | 83,319  |  
|                                                |  |                                      |         |   |                        |   |         |  
|In-country Operations                           |  |                                      | 199,317 |   |                        |   | 181,661 |  
|                                                |  |                                      |         |   |                        |   |         |  
|Total assets                                    |  | $                                    | 344,199 |   |                        | $ | 308,101 |  
|                                                |  |                                      |         |   |                        |   |         |  
|Property & equipment, net                       |  |                                      |         |   |                        |   |         |  
|Miami Operations                                |  | $                                    | 7,555   |   |                        | $ | 7,538   |  
|In-country Operations                           |  |                                      | 8,700   |   |                        |   | 8,757   |  
|                                                |  |                                      |         |   |                        |   |         |  
|Total property & equipment, net                 |  | $                                    | 16,255  |   |                        | $ | 16,295  |  
|                                                |  |                                      |         |   |                        |   |         |  
|Goodwill                                        |  |                                      |         |   |                        |   |         |  
|Miami Operations                                |  | $                                    |        |   |                        | $ |        |  
|In-country Operations                           |  |                                      | 13,854  |   |                        |   | 13,704  |  
|                                                |  |                                      |         |   |                        |   |         |  
|Total goodwill                                  |  | $                                    | 13,854  |   |                        | $ | 13,704  |  
|                                                |  |                                      |         |   |                        |   |         |  



|(1) | For purposes of
geographic disclosure, revenue is attributable to the country in which the Companys individual business resides.
|--- | ---------------------------------------------------------------------------------------------------------------------------------



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



Note 13. Guarantor Condensed Consolidating Financial Statements

At March 31, 2010 and December 31, 2009, $113,680 and $113,346, respectively, of the
131/4% Senior Notes remained outstanding. The
131/4% Senior Notes are unconditionally guaranteed
on a senior secured basis by each of the Companys existing and future domestic restricted subsidiaries (collectively, the Subsidiary Guarantors), but not the Companys foreign subsidiaries (collectively, the
Non-Guarantor Subsidiaries). The 113/4%
Senior Notes were unconditionally guaranteed by each of the Subsidiary Guarantors, with the exception of the Non-Guarantor Subsidiaries. Each of the note guarantees covers the full amount of the
131/4% Senior Notes and each of the Subsidiary
Guarantors is 100% owned by the Company. Pursuant to Rule 3-10(f) of Regulation S-X under the rules promulgated under the Securities Act of 1933, the Parent company has prepared condensed consolidating financial information for the Parent company,
the subsidiaries that are Guarantors of the Companys obligations under the
131/4% Senior Notes on a combined basis and the
Non-Guarantor Subsidiaries on a combined basis.

The indentures
governing the 131/4% Senior Notes and the security
documents executed in connection therewith provide that, in the event that Rule 3-16 of Regulation S-X under the rules promulgated under the Securities Act, or any successor regulation, requires the filing of separate financial statements of any of
the Companys subsidiaries with the SEC, the capital stock pledged as collateral securing the
131/4% Senior Notes, the portion or, if necessary,
all of such capital stock necessary to eliminate such filing requirement, will automatically be deemed released and not have been part of the collateral securing the
131/4% Senior Notes.

The Rule 3-16 requirement to file separate financial statements of a subsidiary is triggered if the aggregate principal amount, par
value, or book value of the capital stock of the subsidiary, as carried by the registrant, or the market value of such capital stock, whichever is greatest, equals 20% or more of the principal amount of the notes. These values are calculated by
using a discounted cash flow model that combines the unlevered free cash flows from our annual five-year business plan plus a terminal value based upon the final year earnings before interest, taxes, depreciation and amortization, or EBITDA of that
business plan which is then multiplied by a multiple based upon comparable companies implied multiples, validated by third-party experts, to arrive at an enterprise value. Existing debt, net of cash on hand, is then subtracted to arrive at the
estimated market value.

Supplemental financial information for Intcomex, Inc., our combined Subsidiary Guarantors and
Non-Guarantor Subsidiaries is presented below.



25



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



CONDENSED CONSOLIDATING BALANCE SHEET

As of March 31, 2010



|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|------------------------------------------ |  | ---------------------- | ------- | ---------- | - | -------------- |  | ------------ | ------- |  | -------------------------- | -------- | - |  | - | -------
|                                           |  | INTCOMEX, INC.(PARENT) |         | GUARANTORS |   | NON-GUARANTORS |  | ELIMINATIONS |         |  | INTCOMEX, INC.CONSOLIDATED
|Current assets                             |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Cash and equivalents                       |  | $                      | 649     |            | $ | 112            |  | $            | 30,435  |  | $                          |         |   |  | $ | 31,196 
|Trade accounts receivable, net             |  |                        |        |            |   | 76,699         |  |              | 76,487  |  |                            | (48,977  | ) |  |   | 104,209
|Inventories                                |  |                        |        |            |   | 32,261         |  |              | 91,511  |  |                            |         |   |  |   | 123,772
|Other                                      |  |                        | 41,825  |            |   | 3,157          |  |              | 67,299  |  |                            | (77,854  | ) |  |   | 34,427 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total current assets                       |  |                        | 42,474  |            |   | 112,229        |  |              | 265,732 |  |                            | (126,831 | ) |  |   | 293,604
|                                           |  |                        |         |            |  
|Long-term assets                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Property and equipment, net                |  |                        | 4,230   |            |   | 3,324          |  |              | 8,701   |  |                            |         |   |  |   | 16,255 
|Investments in subsidiaries                |  |                        | 128,110 |            |   | 206,387        |  |              | 1,444   |  |                            | (335,941 | ) |  |   |       
|Goodwill                                   |  |                        |        |            |   | 7,418          |  |              | 6,436   |  |                            |         |   |  |   | 13,854 
|Other                                      |  |                        | 14,974  |            |   | 43,753         |  |              | 4,523   |  |                            | (42,764  | ) |  |   | 20,486 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total assets                               |  | $                      | 189,788 |            | $ | 373,111        |  | $            | 286,836 |  | $                          | (505,536 | ) |  | $ | 344,199
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|                                           |  |                        |         |            |  
|Liabilities and shareholders equity       |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Current liabilities                        |  | $                      | 6,455   |            | $ | 161,823        |  | $            | 139,937 |  | $                          | (126,790 | ) |  | $ | 181,425
|Long-term debt, net of current maturities  |  |                        | 113,680 |            |   | 533            |  |              | 408     |  |                            |         |   |  |   | 114,621
|Other long-term liabilities                |  |                        | 25,966  |            |   | 18,371         |  |              | 2,904   |  |                            | (42,775  | ) |  |   | 4,466  
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total liabilities                          |  |                        | 146,101 |            |   | 180,727        |  |              | 143,249 |  |                            | (169,565 | ) |  |   | 300,512
|Total shareholders equity                 |  |                        | 43,687  |            |   | 192,384        |  |              | 143,587 |  |                            | (335,971 | ) |  |   | 43,687 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total liabilities and shareholders equity |  | $                      | 189,788 |            | $ | 373,111        |  | $            | 286,836 |  | $                          | (505,536 | ) |  | $ | 344,199
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        



26



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2009



|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|------------------------------------------ |  | ---------------------- | ------- | ---------- | - | -------------- |  | ------------ | ------- |  | -------------------------- | -------- | - |  | - | -------
|                                           |  | INTCOMEX, INC.(PARENT) |         | GUARANTORS |   | NON-GUARANTORS |  | ELIMINATIONS |         |  | INTCOMEX, INC.CONSOLIDATED
|Current assets                             |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Cash and equivalents                       |  | $                      | 2,637   |            | $ | 41             |  | $            | 24,556  |  | $                          |         |   |  | $ | 27,234 
|Trade accounts receivable, net             |  |                        |        |            |   | 61,830         |  |              | 77,547  |  |                            | (39,139  | ) |  |   | 100,238
|Inventories                                |  |                        |        |            |   | 26,743         |  |              | 68,442  |  |                            |         |   |  |   | 95,185 
|Other                                      |  |                        | 41,089  |            |   | 3,832          |  |              | 69,367  |  |                            | (79,795  | ) |  |   | 34,493 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total current assets                       |  |                        | 43,726  |            |   | 92,446         |  |              | 239,912 |  |                            | (118,934 | ) |  |   | 257,150
|                                           |  |                        |         |            |  
|Long-term assets                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Property and equipment, net                |  |                        | 3,994   |            |   | 3,543          |  |              | 8,758   |  |                            |         |   |  |   | 16,295 
|Investments in subsidiaries                |  |                        | 121,648 |            |   | 197,991        |  |              | 371     |  |                            | (320,010 | ) |  |   |       
|Goodwill                                   |  |                        |        |            |   | 7,418          |  |              | 6,286   |  |                            |         |   |  |   | 13,704 
|Other                                      |  |                        | 15,010  |            |   | 42,990         |  |              | 4,906   |  |                            | (41,954  | ) |  |   | 20,952 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total assets                               |  | $                      | 184,378 |            | $ | 344,388        |  | $            | 260,233 |  | $                          | (480,898 | ) |  | $ | 308,101
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|                                           |  |                        |         |            |  
|Liabilities and shareholders equity       |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Current liabilities                        |  | $                      | 2,974   |            | $ | 142,477        |  | $            | 119,644 |  | $                          | (118,638 | ) |  | $ | 146,457
|Long-term debt, net of current maturities  |  |                        | 113,316 |            |   | 628            |  |              | 481     |  |                            |         |   |  |   | 114,425
|Other long-term liabilities                |  |                        | 25,354  |            |   | 18,895         |  |              | 2,456   |  |                            | (42,220  | ) |  |   | 4,485  
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total liabilities                          |  |                        | 141,644 |            |   | 162,000        |  |              | 122,581 |  |                            | (160,858 | ) |  |   | 265,367
|Total shareholders equity                 |  |                        | 42,734  |            |   | 182,388        |  |              | 137,652 |  |                            | (320,040 | ) |  |   | 42,734 
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        
|Total liabilities and shareholders equity |  | $                      | 184,378 |            | $ | 344,388        |  | $            | 260,233 |  | $                          | (480,898 | ) |  | $ | 308,101
|                                           |  |                        |         |            |   |                |  |              |         |  |                            |          |   |  |   |        



27



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INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended March 31, 2010



|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|----------------------------------------------- |  | ---------------------- | ------ | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | -------------------------- | ------- | - |  | - | ------- | -
|                                                |  | INTCOMEX, INC.(PARENT) |        |   | GUARANTORS |   |         | NON-GUARANTORS |  |   | ELIMINATIONS |   |  | INTCOMEX, INC.CONSOLIDATED |        
|Revenue                                         |  | $                      |       |   |            | $ | 137,564 |                |  | $ | 184,229      |   |  | $                          | (78,148 | ) |  | $ | 243,645 |  
|Cost of revenue                                 |  |                        |       |   |            |   | 129,306 |                |  |   | 168,314      |   |  |                            | (77,735 | ) |  |   | 219,885 |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Gross profit                                    |  |                        |       |   |            |   | 8,258   |                |  |   | 15,915       |   |  |                            | (413    | ) |  |   | 23,760  |  
|Operating expenses                              |  |                        | 2,235  |   |            |   | 4,474   |                |  |   | 11,260       |   |  |                            |        |   |  |   | 17,969  |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Operating (loss) income                         |  |                        | (2,235 | ) |            |   | 3,784   |                |  |   | 4,655        |   |  |                            | (413    | ) |  |   | 5,791   |  
|Other expense, net Interest expense, net        |  |                        | 4,932  |   |            |   | 334     |                |  |   | (469         | ) |  |                            |        |   |  |   | 4,797   |  
|Other, net                                      |  |                        | (5,462 | ) |            |   | (6,356  | )              |  |   | 454          |   |  |                            | 11,925  |   |  |   | 561     |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Total other (income) expense                    |  |                        | (530   | ) |            |   | (6,022  | )              |  |   | (15          | ) |  |                            | 11,925  |   |  |   | 5,358   |  
|(Loss) income before provision for income taxes |  |                        | (1,705 | ) |            |   | 9,806   |                |  |   | 4,670        |   |  |                            | (12,338 | ) |  |   | 433     |  
|(Benefit) provision for income taxes            |  |                        | (1,592 | ) |            |   | 1,401   |                |  |   | 737          |   |  |                            |        |   |  |   | 546     |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Net (loss) income                               |  | $                      | (113   | ) |            | $ | 8,405   |                |  | $ | 3,933        |   |  | $                          | (12,338 | ) |  | $ | (113    | )
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended March 31, 2009



|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|----------------------------------------------- |  | ---------------------- | ------ | - | ---------- | - | ------- | -------------- |  | - | ------------ | - |  | -------------------------- | ------- | - |  | - | ------- | -
|                                                |  | INTCOMEX, INC.(PARENT) |        |   | GUARANTORS |   |         | NON-GUARANTORS |  |   | ELIMINATIONS |   |  | INTCOMEX, INC.CONSOLIDATED |        
|Revenue                                         |  | $                      |       |   |            | $ | 108,599 |                |  | $ | 149,374      |   |  | $                          | (53,591 | ) |  | $ | 204,382 |  
|Cost of revenue                                 |  |                        |       |   |            |   | 101,982 |                |  |   | 135,395      |   |  |                            | (53,591 | ) |  |   | 183,786 |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Gross profit                                    |  |                        |       |   |            |   | 6,617   |                |  |   | 13,979       |   |  |                            |        |   |  |   | 20,596  |  
|Operating expenses                              |  |                        | 2,252  |   |            |   | 4,220   |                |  |   | 11,627       |   |  |                            |        |   |  |   | 18,099  |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Operating (loss) income                         |  |                        | (2,252 | ) |            |   | 2,397   |                |  |   | 2,352        |   |  |                            |        |   |  |   | 2,497   |  
|Other expense, net Interest expense, net        |  |                        | 3,606  |   |            |   | 472     |                |  |   | (391         | ) |  |                            |        |   |  |   | 3,687   |  
|Other, net                                      |  |                        | (5,094 | ) |            |   | (1,592  | )              |  |   | 1,607        |   |  |                            | 3,006   |   |  |   | (2,073  | )
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Total other (income) expense                    |  |                        | (1,488 | ) |            |   | (1,120  | )              |  |   | 1,216        |   |  |                            | 3,006   |   |  |   | 1,614   |  
|(Loss) income before provision for income taxes |  |                        | (764   | ) |            |   | 3,517   |                |  |   | 1,136        |   |  |                            | (3,006  | ) |  |   | 883     |  
|(Benefit) provision for income taxes            |  |                        | (777   | ) |            |   | 790     |                |  |   | 857          |   |  |                            |        |   |  |   | 870     |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  
|Net income (loss)                               |  | $                      | 13     |   |            | $ | 2,727   |                |  | $ | 279          |   |  | $                          | (3,006  | ) |  | $ | 13      |  
|                                                |  |                        |        |   |            |   |         |                |  |   |              |   |  |                            |         |   |  |   |         |  



28



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##### Table of Contents

INTCOMEX, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share data)

(Unaudited)



CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2010



|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|---------------------------------------------------- |  | ---------------------- | ------ | - | ---------- | - | ---- | -------------- |  | - | ------------ | - | -------------------------- | - | - |  | - | ------ | -
|                                                     |  | INTCOMEX, INC.(PARENT) |        |   | GUARANTORS |   |      | NON-GUARANTORS |  |   | ELIMINATIONS |   | INTCOMEX, INC.CONSOLIDATED |  
|Cash flows from operating activities                 |  | $                      | (1,433 | ) |            | $ | (775 | )              |  | $ | 4,095        |   |                            | $ |  |  | $ | 1,887  |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from investing activities                 |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Purchases of property and equipment, net             |  |                        | (555   | ) |            |   | (18  | )              |  |   | (346         | ) |                            |   |  |  |   | (919   | )
|Other                                                |  |                        |       |   |            |   | 4    |                |  |   | 54           |   |                            |   |  |  |   | 58     |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash used in investing activities                    |  |                        | (555   | ) |            |   | (14  | )              |  |   | (292         | ) |                            |   |  |  |   | (861   | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from financing activities                 |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Payments under lines of credit, net                  |  |                        |       |   |            |   | 954  |                |  |   | 1,370        |   |                            |   |   |  |   | 2,324  |  
|Borrowings under long-term debt                      |  |                        |       |   |            |   |     |                |  |   |             |   |                            |   |  |  |   |       |  
|Payments of long-term debt                           |  |                        |       |   |            |   | (94  | )              |  |   | (47          | ) |                            |   |  |  |   | (141   | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from financing activities                 |  |                        |       |   |            |   | 860  |                |  |   | 1,323        |   |                            |   |  |  |   | 2,183  |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Effects of exchange rate changes on cash             |  |                        |       |   |            |   |     |                |  |   | 753          |   |                            |   |  |  |   | 753    |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Net (decrease) increase in cash and cash equivalents |  |                        | (1,988 | ) |            |   | 71   |                |  |   | 5,879        |   |                            |   |  |  |   | 3,962  |  
|Cash and cash equivalents, beginning of period       |  |                        | 2,637  |   |            |   | 41   |                |  |   | 24,556       |   |                            |   |  |  |   | 27,234 |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash and cash equivalents, end of period             |  | $                      | 649    |   |            | $ | 112  |                |  | $ | 30,435       |   |                            | $ |  |  | $ | 31,196 |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2009



|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|---------------------------------------------------- |  | ---------------------- | ------ | - | ---------- | - | ---- | -------------- |  | - | ------------ | - | -------------------------- | - | - |  | - | ------ | -
|                                                     |  | INTCOMEX, INC.(PARENT) |        |   | GUARANTORS |   |      | NON-GUARANTORS |  |   | ELIMINATIONS |   | INTCOMEX, INC.CONSOLIDATED |  
|Cash flows from operating activities                 |  | $                      | 2,781  |   |            | $ | 246  |                |  | $ | (2,171       | ) |                            | $ |  |  | $ | 856    |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from investing activities                 |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Purchases of property and equipment, net             |  |                        | (458   | ) |            |   | (107 | )              |  |   | (214         | ) |                            |   |  |  |   | (779   | )
|Other                                                |  |                        |       |   |            |   |     |                |  |   | 64           |   |                            |   |  |  |   | 64     |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash used in investing activities                    |  |                        | (458   | ) |            |   | (107 | )              |  |   | (150         | ) |                            |   |  |  |   | (715   | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from financing activities                 |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Payments under lines of credit, net                  |  |                        |       |   |            |   | 28   |                |  |   | (916         | ) |                            |   |   |  |   | (888   | )
|Borrowings under long-term debt                      |  |                        |       |   |            |   |     |                |  |   | 57           |   |                            |   |  |  |   | 57     |  
|Payments of long-term debt                           |  |                        | (2,217 | ) |            |   | (95  | )              |  |   | (106         | ) |                            |   |  |  |   | (2,418 | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash flows from financing activities                 |  |                        | (2,217 | ) |            |   | (67  | )              |  |   | (965         | ) |                            |   |  |  |   | (3,249 | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Effects of exchange rate changes on cash             |  |                        |       |   |            |   |     |                |  |   | (280         | ) |                            |   |  |  |   | (280   | )
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Net increase (decrease) in cash and cash equivalents |  |                        | 106    |   |            |   | 72   |                |  |   | (3,566       | ) |                            |   |  |  |   | (3,388 | )
|Cash and cash equivalents, beginning of period       |  |                        |       |   |            |   | 26   |                |  |   | 22,318       |   |                            |   |  |  |   | 22,344 |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  
|Cash and cash equivalents, end of period             |  | $                      | 106    |   |            | $ | 98   |                |  | $ | 18,752       |   |                            | $ |  |  | $ | 18,956 |  
|                                                     |  |                        |        |   |            |   |      |                |  |   |              |   |                            |   |   |  |   |        |  



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##### Table of Contents

|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations.
|------- | --------------------------------------------------------------------------------------

Forward-Looking Statements

This Quarterly Report on Form 10-Q (Quarterly Report), including this Managements Discussion and Analysis of Financial
Condition and Results of Operations, contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933 (the Securities Act) and the Securities
Exchange Act of 1934 (the Exchange Act). All statements other than statements of historical facts are statements that could be deemed forward-looking statements. These statements are based on current expectations, beliefs, estimates,
forecasts, projections and managements assumptions about our Company, our future performance, our liquidity and the IT products distribution industry in which we operate. Words such as may, intend, expect,
anticipate, believe, target, goal, project, plan, seek, estimate, continue, and variations of such words and similar expressions are intended
to identify such forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or
circumstances including but not limited to, managements expectations for competition, revenues, margin, expenses and other operating results; capital expenditures; liquidity; capital requirements, acquisitions and exchange rate fluctuations,
each of which involves numerous risks and uncertainties, are forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to
predict, including those identified below, elsewhere herein and under Part II Other Information, Item 1A. Risk Factors in our Annual Report on Form 10-K filed with the SEC on February 22, 2010 (Annual Report).
These risks and uncertainties include, but are not limited to the following:



| |  |  | adverse affect on our business and results of operations due to the recent global economic downturn;
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | an increase in competition in the markets in which we operate or plan to operate;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | difficulties in maintaining and enhancing internal controls and management and financial reporting systems;
| | - |  | -----------------------------------------------------------------------------------------------------------



| |  |  | adverse changes in general, regional and country-specific economic and political conditions in Latin America and the Caribbean;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------



| |  |  | fluctuations of other currencies relative to the U.S. dollar;
| | - |  | -------------------------------------------------------------



| |  |  | difficulties in staffing and managing our foreign operations;
| | - |  | -------------------------------------------------------------



| |  |  | departures of our key executive officers;
| | - |  | -----------------------------------------



| |  |  | increases in credit exposure to our customers;
| | - |  | ----------------------------------------------



| |  |  | adverse changes in our relationships with vendors and customers; or
| | - |  | -------------------------------------------------------------------



| |  |  | declines in our inventory values.
| | - |  | ---------------------------------

This list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative but not
exhaustive. In addition, new risks and uncertainties may arise from time to time. Accordingly, all forward-looking statements should be evaluated with an understanding of their inherent uncertainty. We caution you not to place undue reliance on
these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to update these forward-looking statements to reflect events or circumstances after the date of this Annual Report. All
forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.

Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statement because of certain
factors discussed below or elsewhere in this Quarterly Report or included in our Annual Report. The following discussion and analysis of our financial condition and results of operations should be read together with the audited consolidated
financial statements and notes thereto, which are included in our Annual Report, and our unaudited condensed consolidated financial statements for the fiscal quarter ended March 31, 2010, which are included in this Quarterly Report.

Overview

We believe we
are the largest pure play value-added distributor of IT products focused solely on serving Latin America and the Caribbean. We distribute computer components, peripherals, software, computer systems, accessories, networking products and digital
consumer electronics to more than 50,000 customers in 40 countries. We offer single source purchasing to our customers by providing an in-stock selection of more than 6,100 products from over 173 vendors, including the worlds leading IT
product manufacturers. From our headquarters and main distribution center in Miami, we support a network of 22 sales and distribution operations in 12 Latin American and Caribbean countries and a sales office in Brazil.



30



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##### Table of Contents

Our results for the three months ended March 31, 2010 reflect an increase in revenue
across most of our product lines and our customer markets, as compared to the corresponding period in 2009. Revenue increased $39.3 million, or 19.2%, to $243.6 million for the three months ended March 31, 2010, as compared to $204.4 million
for the three months ended March 31, 2009. The improvement in the global economy, which experienced a downturn in late 2008 and early 2009, was the main driver of the improvement in our revenues. Gross profit increased $3.2 million, or 15.4%,
to $23.8 million for the three months ended March 31, 2010, as compared to $20.6 million for the three months ended March 31, 2009. The improvement in gross profit was the result of the higher sales volume and increase in average sale
price of several of our products.

Total operating expenses decreased $0.1 million, or $0.7% for the three
months ended March 31, 2010, as compared to the three months ended March 31, 2009, as a result of our 2009 restructuring efforts, including workforce reductions, which were designed to improve our efficiencies and profitability, strengthen
our operations and reduce our costs in several of our locations. Net loss was $0.1 million for the three months ended March 31, 2010, as compared to approximately zero net income for the for the three months ended March 31, 2009. Other
expense (income) increased during the three months ended March 31, 2010 primarily due to the absence of the $3.8 million gain on the repurchase of $6.1 million of our
113/4% Senior Notes at substantial discounts to
their face amount during the three months ended March 31, 2009. Other expense (income) also increased as a result of the higher interest expense related to our $120.0 million
131/4% Second Priority Senior Secured Notes due December 15, 2014 (the
131/4% Senior Notes) that were issued
concurrent with the redemption and cancellation of the
113/4% Second Priority Senior Secured Notes due
January 15, 2011 (the 113/4% Senior
Notes), partially offset by the improved effects of foreign currencies.

Factors Affecting Our
Results of Operations

The following events and developments have in the past, or are expected in the future to have a
significant impact on our financial condition and results of operations:



| |  | Impact of price competition, vendor terms and conditions, and the recent downturn in the global economy. Historically, our gross
profit margins have been impacted by price competition, changes to vendor terms and conditions, including but not limited to, reductions in product rebates and incentives, our ability to return inventory to manufacturers, and time periods during
which vendors provide price protection. We expect these competitive pricing pressures and modifications to vendor terms and conditions to continue into the foreseeable future. The recent downturn in the global economy has also increasingly become a
factor impacting our gross profit margins. We experienced a softening in demand for IT products in Latin America and the Caribbean as a result of the recent global economic downturn.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Shift in revenue to In-country Operations.One of our growth strategies is to expand the geographic presence of our In-country
Operations into areas in which we believe we can achieve higher gross margins than our Miami Operations. Miami gross margins are generally lower than gross margins from our In-country Operations because the Miami export market is more competitive
due to the high concentration of other Miami-based IT distributors who compete for the export business of resellers and retailers located in Latin America or the Caribbean. In addition, these resellers and retailers generally have larger average
order quantities than customers of our In-country Operations segment, and as a result, benefit from lower average prices. Revenue from our In-country Operations grew by an average of 18.0% annually between 2001 and 2009, as compared to growth in
revenue from our Miami Operations of an average of 6.5% annually over the same period. Revenue from our In-country Operations accounted for 75.6% and 73.1% of consolidated revenue for the three months ended March 31, 2010 and 2009,
respectively.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Exposure to fluctuations in foreign currency.A significant portion of the revenues from our In-country Operations is invoiced in
currencies other than the U.S. dollar and a significant amount of the operating expenses from our In-country Operations are denominated in currencies other than the U.S. dollar. In markets where we invoice in local currency, including Argentina,
Chile, Colombia, Costa Rica, Guatemala, Jamaica, Mexico, Peru and Uruguay, the appreciation of a local currency could have a marginal impact on our gross profit and gross margins in U.S. dollar terms. In markets where our books and records are
prepared in currencies other than the U.S. dollar, the appreciation of the local currency will increase our operating expenses and decrease our operating margins in U.S. dollar terms. Our consolidated statements of operations includes a foreign
exchange loss of $0.5 million and $1.6 million, respectively, for the three months ended March 31, 2010 and 2009. We periodically engage in foreign currency forward contracts when available and when doing so is not cost prohibitive. In periods
when we do not, foreign currency fluctuations may adversely affect our results of operations, including our gross margins and operating margins.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

| |  | Trade credit.All of our key vendors and many of our other vendors provide us with trade credit. Historically, trade credit has
been an important source of liquidity to finance our growth. Although our overall available trade credit has increased significantly over time, from time to time the trade credit available from certain vendors has not kept pace with the growth of
our business with them. Given the recent economic downturn, many of our vendors reduced the level of available trade credit extended to us as a result of our vendors view of our liquidity at the time.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

When we purchase goods from these vendors, we need to increase our use of available cash or borrowings under our credit facility (in each
case to the extent available) to pay the purchase price of the products, which adversely affects our liquidity and can adversely affect our results of operations and opportunities for growth. We purchase credit insurance from Euler Hermes ACI to
support trade credit lines extended to our customers which has been restricted recently due to the recent global economic downturn and the disruptions in the credit markets. Given the recent economic downturn, credit insurers have tightened the
requirements for extending credit insurance coverage thereby limiting our capacity to extend trade credit to our customers and the growth of our business throughout the region.



| |  | Increased levels of indebtedness.In connection with the investment by CVC International in our Company in August 2004 and our
re-acquisition of Centel in August 2005, we borrowed under our former senior secured credit facility with Wells Fargo Foothill and Morgan Stanley and issued subordinated seller notes to the sellers, which increased our leverage and our interest
expense.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

On December 8, 2009, we commenced a cash tender offer for $96.9 million
aggregate principal amount of 113/4% Senior Notes
outstanding. We financed the tender offer with the net cash proceeds of $120.0 million aggregate principal amount of the
131/4% Senior Notes that were sold in a private
placement transaction which closed on December 22, 2009. We used the proceeds from the sale of the 131/4% Senior Notes to repay our borrowings under, and renew our existing senior secured credit facility, repurchase, redeem or otherwise discharge our
113/4% Senior Notes and the balance for general
corporate purposes. For the three months ended March 31, 2010 and 2009, interest expense was $4.9 million and $3.8 million, respectively.



| |  | Goodwill impairment.Goodwill represents the excess of the purchase price over the fair value of the net assets. We perform our
impairment test of our goodwill and other intangible assets on an annual basis. The goodwill impairment charge represents the extent to which the carrying values exceeded the fair value attributable to our goodwill. Fair values are determined based
upon market conditions and the income approach which utilizes cash flow projections and other factors. The decline in value of our goodwill was consistent with the overall market decline as a result of the recent global economic environment and
financial market dislocation. Our future results of operations may be impacted by the prolonged weakness in the current economic environment, which may result in a further impairment of any existing goodwill or goodwill and/or other long-lived
assets recorded in the future.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In connection with our goodwill impairment testing and analysis conducted in
2009, we noted that the fair value of Centels goodwill exceeded the carrying amount by 3.4%. The fair value of Centel was determined using managements estimate of fair value based upon the financial projections for the business
given the recent economic contraction in Mexicos gross domestic product, or GDP. As of March 31, 2010 and December 31, 2009, the balance of Centels goodwill was $3.1 million and $2.9 million, respectively, which
represented 8.9% and 9.5%, respectively, of the carrying amount of Centel and less than 1.0% of our total assets. An extended period of economic contraction could result in a further impairment to the carrying amount of the goodwill of Centel.
We did not record an impairment charge for goodwill and identifiable intangible assets for the three months ended March 31, 2010 and 2009.



| |  | Deferred tax assets.Deferred income tax represents the tax effect of the differences between the book and tax bases of assets and
liabilities. Deferred tax assets, which also include net operating loss (NOL) carryforwards for entities that have generated or continue to generate operating losses, are assessed periodically by management to determine if their future
benefit will be fully realized. If it is more likely than not that the deferred income tax asset will not be realized, then a valuation allowance must be established with a corresponding charge to net (loss) income. Such charges could have a
material adverse effect on our results of operations or financial condition.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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As of March 31, 2010 and December 31, 2009, our U.S. and state of Florida NOLs
resulted in $14.3 million and $13.3 million, respectively, of deferred tax assets, which will begin to expire in 2026. As of March 31, 2010 and December 31, 2009, Intcomex Argentina, S.R.L. (Intcomex Argentina) had $4.0 million
in NOLs resulting in $1.4 million of deferred tax assets, which will begin to expire in 2011. As of March 31, 2010 and December 31, 2009, Intcomex Holdings SPC-1, LLC (Intcomex Mexico or Centel) had $1.1 million in
NOLs resulting in $0.3 million of deferred tax assets, which will expire in 2018 and Intcomex Colombia LTDA (Intcomex Colombia) had $0.8 million in NOLs resulting in $0.3 million of deferred tax assets related to a NOL carryforward.

We periodically analyze the available evidence related to the realization of the deferred tax assets, including the current
economic environment and determine if it is more likely than not that we will not recognize a portion of our deferred tax assets associated with the NOL carryforwards. Factors in managements determination include the performance of the
business and the feasibility of ongoing tax planning strategies. As of March 31, 2010 and December 31, 2009, we recorded a valuation allowance of $5.5 million and $4.5 million, respectively, in the U.S. against the NOLs, as management does
not believe that it will realize the full benefit of these NOLs. Our future results of operations may be impacted by a prolonged weakness in the economic environment, which may result in further valuation allowances on our deferred tax assets and
adversely affect our results of operations or financial condition.

Results of Operations

We report our business in two operating segments based upon the geographic location of where we originate the sale: Miami and In-country.
Miami segment, or our Miami Operations, includes revenue from our Miami, Florida headquarters, including sales from Miami to our in-country sales and distribution centers and sales directly to resellers, retailers and distributors that are located
in countries in which we have in-country sales and distribution operations or in which we do not have any In-country Operations. In-country segment, or our In-country Operations, includes revenue from our in-country sales and distribution centers,
which have been aggregated because of their similar economic characteristics. Most of our vendor rebates, incentives and allowances are reflected in the results of our Miami segment. When we consolidate our results, we eliminate revenue and cost of
revenue attributable to inter-segment sales, and the financial results of our Miami segment discussed below reflect these eliminations.

Comparison of the quarter ended March 31, 2010 versus the quarter ended March 31, 2009

The following table sets forth selected financial data (in thousands) and percentages of revenue for the periods presented:



|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|---------------------------------------- |  | -------------------------------- | ------- | - | -------------------------------- | ----- | -- | ------ | - | -------------------- |  | ----- | -
|                                         |  | Three Months EndedMarch 31, 2010 |         |   | Three Months EndedMarch 31, 2009 |      
|                                         |  | Amount                           |         |   | Percentageof Revenue             |       |    | Amount |   | Percentageof Revenue | 
|Revenue                                  |  | $                                | 243,645 |   |                                  | 100.0 | %  |        | $ | 204,382              |  | 100.0 | %
|Cost of revenue                          |  |                                  | 219,885 |   |                                  | 90.2  | %  |        |   | 183,786              |  | 89.9  | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|Gross profit                             |  |                                  | 23,760  |   |                                  | 9.8   | %  |        |   | 20,596               |  | 10.1  | %
|Selling, general and administrative      |  |                                  | 16,895  |   |                                  | 6.9   | %  |        |   | 17,055               |  | 8.3   | %
|Depreciation and amortization            |  |                                  | 1,074   |   |                                  | 0.4   | %  |        |   | 1,044                |  | 0.5   | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|Total operating expenses                 |  |                                  | 17,969  |   |                                  | 7.4   | %  |        |   | 18,099               |  | 8.9   | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|Operating income                         |  |                                  | 5,791   |   |                                  | 2.4   | %  |        |   | 2,497                |  | 1.2   | %
|Other expense, net                       |  |                                  | 5,358   |   |                                  | 2.2   | %  |        |   | 1,614                |  | 0.8   | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|Income before provision for income taxes |  |                                  | 433     |   |                                  | 0.2   | %  |        |   | 883                  |  | 0.4   | %
|Provision for income taxes               |  |                                  | 546     |   |                                  | 0.2   | %  |        |   | 870                  |  | 0.4   | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  
|Net (loss) income                        |  | $                                | (113    | ) |                                  | (0.0  | )% |        | $ | 13                   |  | 0.0   | %
|                                         |  |                                  |         |   |                                  |       |    |        |   |                      |  |       |  



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Revenue. Revenue increased $39.3 million, or 19.2%, to $243.6 million for the
three months ended March 31, 2010, from $204.4 million for the three months ended March 31, 2009. Our revenue growth was driven by the increased demand for our products throughout Latin America and the Caribbean, as a result of the
improved economic conditions, for the three months ended March 31, 2010, as compared to the corresponding period in 2009. Revenue growth was driven primarily by the increase in sales of notebook computers of $21.1 million, memory products of
$8.3 million and hard disk drives of $5.1 million in our In-country Operations, particularly in Chile, Colombia, Costa Rica, El Salvador, Guatemala and Peru, and to a lesser extent, in our Miami Operations. We experienced a 13.6% increase in unit
shipments across our core product lines for the three months ended March 31, 2010, as compared to the three months ended March 31, 2009, due to the improved demand for IT products, coupled with a 7.4% increase in average sales prices
across the same core products. Revenue derived from our In-country Operations increased $34.9 million, or 23.3%, to $184.2 million for the three months ended March 31, 2010, from $149.4 million for the three months ended March 31, 2009.
Revenue derived from our In-country Operations accounted for 75.6% of our total revenue for the three months ended March 31, 2010, as compared to 73.1% of our total revenue for the three months ended March 31, 2009. The growth in revenue
from our In-country Operations was mainly due to the overall increase in sales in Chile, Colombia, Costa Rica, El Salvador, Guatemala and Peru, and to a lesser extent, in Jamaica and Uruguay. This growth was driven by the increased sales volume and
sales price of memory products and hard disk drives and the increased sales volume of notebook computers and basic white-book systems. Revenue derived from our Miami Operations increased $4.4 million, or 8.0%, to $59.4 million for the
three months ended March 31, 2010 (net of $78.1 million of revenue derived from sales to our In-country Operations) from $55.0 million for the three months ended March 31, 2009 (net of $53.6 million of revenue derived from sales to our
In-country Operations). The growth in revenue derived from our Miami Operations reflected the increased sales volume and sales price of memory products and hard disk drives, the increased sales volume of notebook computers and printers, partially
offset by the decrease in sales volume and sales price of central processing units (CPUs) and software.

Gross profit.Gross profit increased $3.2 million, or 15.4%, to $23.8 million for the three months ended March 31,
2010, from $20.6 million for the three months ended March 31, 2009. The increase was primarily driven by higher sales volume in our Miami Operations and In-country Operations. Gross profit from our In-country Operations increased $1.5 million,
or 10.7%, to $15.5 million for the three months ended March 31, 2010, from $14.0 million for the three months ended March 31, 2009. The improvement in gross profit from our In-country Operations was driven by the increased sales volume of
notebook computers, memory products and hard disk drives, particularly in Chile, Colombia, Costa Rica, El Salvador, Guatemala and Peru. Gross profit from our In-country Operations accounted for 65.2% of our consolidated gross profit for the three
months ended March 31, 2010, as compared to 68.0% of our consolidated gross profit for the three months ended March 31, 2009. Gross profit from our Miami Operations increased $1.7 million, or 25.2%, to $8.3 million for the three months
ended March 31, 2010, as compared to $6.6 million for the three months ended March 31, 2009. The improvement in gross profit from our Miami Operations was driven by the increased sales volume and sales price of memory products and hard
disk drives, increased sales volume of notebook computers and printers, partially offset by the decrease in sales volume and sales price of CPUs and software. As a percentage of revenue, gross margin decreased to 9.8% for the three months ended
March 31, 2010, as compared to 10.1% for the three months ended March 31, 2009, due to the higher sales volume of notebook computers and the effects of fluctuations in foreign currencies on our In-country Operations.

Operating expenses.Total operating expenses decreased $0.1 million, or 0.7%, to $18.0 million for the three months ended
March 31, 2010, from $18.1 million for the three months ended March 31, 2009. As a percentage of revenue, operating expenses decreased to 7.4% of revenue for the three months ended March 31, 2010, as compared to 8.9% of revenue for
the three months ended March 31, 2009. The decrease in operating expenses resulted from our restructuring actions implemented in the fourth quarter of 2008 and the first and second quarters of 2009, which were designed to improve our
efficiencies and profitability, primarily in our Miami Operations and certain of our In-country Operations, particularly in Argentina, Chile, Colombia, Mexico and Panama. The decrease was also driven in part by lower levels of bad debt expense of
$0.6 million and professional fees of $0.3 million for the three months ended March 31, 2010. The decline in operating expenses was partially offset by an increase in salaries and payroll-related expenses and office, warehouse, building and
occupancy expenses due to the effects of strengthening currencies in several of our operations, most notably Chile, Colombia and Mexico. As a percentage of total operating expenses, salaries and payroll-related expenses increased to 56.8% of total
operating expenses for the three months ended March 31, 2010, as compared to 52.5% for the three months ended March 31, 2009, due to the effects of strengthening currencies in several of our operations, most notably Chile, Colombia and
Mexico, and bonus provisions related primarily to our In-country Operations. Operating expenses from our In-country Operations decreased $1.8 million, or 15.4%, to $9.8 million for the three months ended March 31, 2010, as compared to $11.6
million for the three months ended March 31, 2009, due to the lower bad debt expense, particularly in Colombia, and to a lesser extent Argentina, Chile, Peru and Uruguay. Operating expenses from our Miami Operations increased $1.7 million, or
25.6%, to $8.2 million for the three months ended March 31, 2010, as compared to $6.5 million for the three months ended March 31, 2009, due to the higher level of salaries and payroll-related expenses, professional fees and bad debt
expense, driven mainly by the increased sales volume.

Operating income. Operating income increased $3.3 million
to $5.8 million for the three months ended March 31, 2010, from $2.5 million for the three months ended March 31, 2009, driven primarily by the higher sales volume. Operating income from our In-country Operations increased $3.3 million to
$5.7 million for the three months ended March 31, 2010, from $2.4 million for the three months ended March 31, 2009, primarily from the higher sales volume and lower bad debt expense. Operating income from our Miami Operations remained
steady at $0.1 million for the three months ended March 31, 2010 and 2009.



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Other expense, net.Other expense, net increased $3.7
million to $5.4 million for the three months ended March 31, 2010, from $1.6 million for the three months ended March 31, 2009. The increase in other expense, net was primarily attributable to the absence of the $3.8 million gain on the
repurchase of $6.1 million of our 113/4% Senior
Notes at substantial discounts to their face amount during the three months ended March 31, 2009. Other expense, net also increased due to the higher interest expense related to the
131/4% Senior Notes that were issued concurrent
with the redemption and cancellation of the 113/4%
Senior Notes, partially offset by the lower foreign exchange loss primarily related to the devaluation of the Chilean Peso by 4.5% for the three months ended March 31, 2010.

Provision for income taxes.Provision for income taxes decreased $0.3 million, or 37.2%, to $0.5 million for the three
months ended March 31, 2010, from $0.9 million for the three months ended March 31, 2009. The decrease was due to lower taxable earnings partially offset by the additional $1.1 million valuation allowance recorded in the U.S. against its
NOLs.

Net (loss) income.Net (loss) income decreased to net loss of $0.1 million for the
three months ended March 31, 2010, as compared to a slight amount of net income for the three months ended March 31, 2009. The decrease resulted from the absence of the $3.8 million gain on the repurchase of $6.1 million of our
113/4% Senior Notes at substantial discounts to
their face amount that we recognized during the three months ended March 31, 2009. Net (loss) income also decreased due to the higher interest expense related to the new
131/4% Senior Notes that were issued concurrent
with the redemption and cancellation of our 113/4%
Senior Notes, partially offset by the improved effects of foreign currencies relative to the U.S. dollar.

Liquidity
and Capital Resources

The IT products distribution business is working-capital intensive.
Historically, we have financed our working capital needs through a combination of cash generated from operations, trade credit from manufacturers, borrowings under revolving bank lines of credit (including issuance of letters of credit), asset-based
financing arrangements that we have established in certain Latin American markets and the issuance of our
13 1/4% Senior Notes.

Our working capital increased by $1.5 million, or 1.3%, to $112.2 million at March 31, 2010, as compared to $110.7 million at
December 31, 2009. This increase was driven primarily by an increase in inventories, partially offset by higher accounts payable. Our cash and cash equivalents at March 31, 2010 amounted to $31.2 million, as compared to $27.2 million at
December 31, 2009. The increase was primarily attributable to the increase in trade accounts payable and the increase in our lines of credit borrowings during the three months ended March 31, 2010. We believe the improvement in working
capital will benefit our Company in our ability to fund our working capital and capital expenditure requirements.

Changes
in Financial Condition

The following table summarizes our cash flows for the periods presented:



|                                                                              |  |                            |       |   |                |   |        |  
|----------------------------------------------------------------------------- |  | -------------------------- | ----- | - | -------------- | - | ------ | -
|                                                                              |  | For the Three Months Ended |      
|                                                                              |  | March 31, 2010             |       |   | March 31, 2009 |  
|                                                                              |  | (Dollars in thousands)     |      
|Cash flows provided by operating activities                                   |  | $                          | 1,887 |   |                | $ | 856    |  
|Cash flows used in investing activities                                       |  |                            | (861  | ) |                |   | (715   | )
|Cash flows provided by (used in) by financing activities                      |  |                            | 2,183 |   |                |   | (3,249 | )
|Effect of foreign currency exchange rate changes on cash and cash equivalents |  |                            | 753   |   |                |   | (280   | )
|                                                                              |  |                            |       |   |                |   |        |  
|Net increase (decrease) in cash and cash equivalents                          |  | $                          | 3,962 |   |                | $ | (3,388 | )
|                                                                              |  |                            |       |   |                |   |        |  

Cash flows from operating activities. Our cash flows from operating activities resulted
in a generation of $1.9 million for the three months ended March 31, 2010, as compared to $0.9 million for the three months ended March 31, 2009. The generation was primarily driven by the increase in accounts payable and accrued expenses
in the first quarter 2010, as compared to 2009, partially offset by an increase in inventory levels in the first quarter 2010.



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Cash flows from investing activities. Our cash flows from investing
activities resulted in a requirement of $0.9 million for the three months ended March 31, 2010, as compared to $0.7 million for the three months ended March 31, 2009. This requirement was primarily driven by the completion in Mexico of the
implementation of Sentai, our company-wide enterprise resource planning, management and financial reporting system.

Cash flows from financing activities. Our cash flows from financing activities resulted in
generation of $2.2 million for the three months ended March 31, 2010, as compared to a requirement of $3.2 million for the three months ended March 31, 2009. This increase was driven by the absence of the repurchase of $6.1 million of our
113/4% Senior Notes at substantial discounts to
their face amount. The generation was also a result of higher net borrowings under our lines of credit from our Miami Operation and our In-country Operations, particularly, Ecuador, Guatemala, Panama and Peru.

Working Capital Management

The successful management of our working capital needs is a key driver of our growth and cash flow generation. The following table sets
forth certain information about the largest components of our working capital: our trade accounts receivable, inventories and accounts payable:



|                                            |  |                        |         |   |                        |   |         |  
|------------------------------------------- |  | ---------------------- | ------- | - | ---------------------- | - | ------- | -
|                                            |  | As ofMarch 31, 2010    |         |   | As ofDecember 31, 2009 |  
|                                            |  | (Dollars in thousands) |        
|Balance sheet data:                         |  |                        |         |   |                        |   |         |  
|Trade accounts receivable, net of allowance |  | $                      | 104,209 |   |                        | $ | 100,238 |  
|Inventories                                 |  |                        | 123,772 |   |                        |   | 95,185  |  
|Accounts payable                            |  |                        | 144,484 |   |                        |   | 117,216 |  
|                                            | 
|                                            |  | (Data in days)         |        
|Other data:                                 |  |                        |         |   |                        |   |         |  
|Trade accounts receivable days(1)           |  |                        | 38.5    |   |                        |   | 39.9    |  
|Inventory days(2)                           |  |                        | 50.7    |   |                        |   | 42.1    |  
|Accounts payable days(3)                    |  |                        | (59.1   | ) |                        |   | (51.8   | )
|                                            |  |                        |         |   |                        |   |         |  
|Cash conversion cycle(4)                    |  |                        | 30.1    |   |                        |   | 30.2    |  
|                                            |  |                        |         |   |                        |   |         |  



|(1) | Trade accounts receivable days is defined as our consolidated trade accounts receivable (net of allowance for doubtful accounts) as of the last day of the period
divided by our consolidated revenue for such period times 90 days for the quarter ended March 31, 2010 and 365 days for the year ended December 31, 2009. Our consolidated trade accounts receivable for our In-country
Operations include value added tax at a rate of between 5% and 27% (depending on the country). The exclusion of such value added tax would result in lower trade accounts receivable days.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Inventory days is defined as our consolidated inventory as of the last day of the period divided by our consolidated cost of goods sold for such period
times 90 days for the quarter ended March 31, 2010 and 365 days for the year ended December 31, 2009.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Accounts payable days is defined as our consolidated accounts payable as of the last day of the period divided by our consolidated cost of goods sold for such
period times 90 days for the quarter ended March 31, 2010 and 365 days for the year ended December 31, 2009.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Cash conversion cycle is defined as our trade accounts receivable days plus inventory days less accounts payable days.
|--- | ----------------------------------------------------------------------------------------------------------------------

Cash conversion cycle days. One measurement we use to monitor working capital is the cash conversion
cycle, which measures the number of days to convert trade accounts receivable and inventory, net of accounts payable, into cash. Our cash conversion cycle remained stable at 30.1 days as of March 31, 2010, and 30.2 days as of December 31,
2009. The increase in inventory days was mostly offset by the increase in our trade accounts payable days. Trade accounts receivable days decreased slightly to 38.5 days as of March 31, 2010, from 39.9 days as of December 31, 2009.
Inventory days increased to 50.7 days as of March 31, 2010, from 42.1 days as of December 31, 2009, due to growth in inventory levels to meet improving demand. Accounts payable days increased to 59.1 days as of March 31, 2010, from
51.8 days as of December 31, 2009, due to the increased inventory purchases.



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Trade accounts receivable. We principally sell products
to a large base of third-party distributors, resellers and retailers throughout Latin America and the Caribbean and to other Miami-based exporters of IT products to Latin America and the Caribbean. Credit risk on trade receivables is diversified
over several geographic areas and a large number of customers. No one customer accounted for more than 2.1% of sales for the three months ended March 31, 2010 and 2.0% of sales for the three months ended March 31, 2009. We provide trade
credit to our customers in the normal course of business. The collection of a substantial portion of our receivables is susceptible to changes in Latin America and Caribbean economies and political climates. We monitor our exposure for credit losses
and maintain allowances for anticipated losses after giving consideration to delinquency data, historical loss experience, and economic conditions impacting our industry. The financial condition of our customers and the related allowance for
doubtful accounts is continually reviewed by management.

We believe the recent global economic downturn and the associated
credit crisis had a negative impact on us and our creditors. The global recession has adversely affected our vendors and customers ability to obtain financing for operations. The subsequent tightening of credit in financial markets has
affected our suppliers, who have already tightened trade credit, and, in turn, we have tightened trade credit to our customers.

Prior to extending credit to a customer, we analyze the customers financial history and obtain personal guarantees, where
appropriate. Our Miami Operations and In-country Operations in Chile use credit insurance and make provisions for estimated credit losses. Our other In-country Operations make provisions for estimated credit losses but generally do not use credit
insurance. Our Miami Operations has a credit insurance policy covering trade sales to non-affiliated buyers with Euler Hermes ACI. The policys aggregate limit is $20.0 million with an aggregate deductible of $1.5 million; the policy expires on
August 31, 2010. In addition, 10% or 20% buyer coinsurance provisions and sub-limits in coverage on a per-buyer and per-country basis apply. The policy also covers certain large, local companies in Argentina, Costa Rica, El Salvador, Guatemala,
Jamaica and Peru. Our In-country Operations in Chile insures certain customer accounts with Coface Chile, S.A. credit insurance company; the policy expires on October 31, 2010.

Our large customer base and our credit policies allow us to limit and diversify our exposure to credit risk on our trade accounts
receivable.

Inventory. We seek to minimize our inventory levels and inventory obsolescence rates through
frequent product shipments, close and ongoing monitoring of inventory levels and customer demand patterns, optimal use of carriers and shippers and the negotiation of clauses in some vendor supply agreements protecting against loss of value of
inventory in certain circumstances. The Miami distribution center ships products to each of our In-country Operations approximately twice per week by air and once per week by sea. These frequent shipments result in efficient inventory management and
increased inventory turnover. We do not have long-term contracts with logistics providers, except in Mexico and Chile. Where we do not have long-term contracts, we seek to obtain the best rates and fastest delivery times on a shipment-by-shipment
basis. Our Miami Operations also coordinates direct shipments to third-party customers and each of our In-country Operations from vendors in Asia.

Accounts payable. We seek to maximize our accounts payable days through centralized purchasing and management of our vendor
back-end rebates, promotions and incentives. This centralization of the purchasing function allows our In-country Operations to focus their attention on more country-specific issues such as sales, local marketing, credit control and collections. The
centralization of purchasing also allows our Miami operation to control the records and receipts of all vendor back-end rebates, promotions and incentives to ensure their collection and to adjust pricing of products according to such incentives.

Capital Expenditures and Investments

Capital expenditures increased to $0.9 million for the three months ended March 31, 2010, as compared to $0.8 million for the three
months ended March 31, 2009. The increase was primarily driven by the capital expenditures related to the final implementation and integration of our ERP system in our operations in Mexico.

Our future capital requirements will depend on many factors, including the timing and amount of our revenues and our investment
decisions, which will affect our ability to generate additional cash. We believe that our existing cash and cash equivalents will be sufficient to meet our anticipated cash requirements for working capital and capital expenditures for the
foreseeable future. Thereafter, if cash generated from operations and financing activities is insufficient to satisfy our working capital requirements, we may seek additional funding through bank borrowings or other means. There can be no assurance
that we will be able to raise any such capital on terms acceptable to us or at all. The recent global economic downturn and the subsequent tightening of the credit markets further heightens the risk that we may not be able to borrow additional funds
under our existing credit facilities if participating banks become insolvent or their liquidity is impaired or that our ability to obtain alternative sources of financing will be limited. We anticipate that capital expenditures will be approximately
$4.0 million per year over the next few years, as we have no further facility expansion needs and have completed our ERP system implementation and integration. We have the option to purchase the warehouse and office facility located in Mexico City,
Mexico, which we currently lease, prior to December 31, 2011, the option termination date. If we exercise this option, our capital expenditures will increase by $3.0 million in the year of exercise.



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Capital Resources

We currently believe that our cash on hand, anticipated cash provided by operations, available and anticipated trade credit and borrowings
under our existing credit facility and lines of credit, will provide sufficient resources to meet our anticipated debt service requirements, capital expenditures and working capital needs for the next 12 months. If our results of operations are not
as favorable as we anticipate (including as a result of increased competition), our funding requirements are greater than we expect (including as a result of growth in our business), or our liquidity sources are not at anticipated levels (including
levels of available trade credit), our resources may not be sufficient and we may have to raise additional financing or capital to support our business. In addition, we may not be able to accurately predict future operating results or changes in our
industry that may change these needs. We continually assess our capital needs and may seek additional financing as needed to fund working capital requirements, capital expenditures and potential acquisitions. We cannot assure you that we will be
able to generate anticipated levels of cash from operations or to obtain additional debt or equity financing in a timely manner, if at all, or on terms that are acceptable to us. Our inability to generate sufficient cash or obtain financing could
hurt our results of operations and financial condition and prevent us from growing our business as anticipated.

We have lines
of credit, short-term overdraft and credit facilities with various financial institutions in the countries in which we conduct business. Many of the In-country Operations also have limited credit facilities. These credit facilities fall into the
following categories: asset-based financing facilities, letters of credit and performance bond facilities, and unsecured revolving credit facilities and lines of credit. The lines of credit are available sources of short-term liquidity for us.

As of March 31, 2010 and December 31, 2009, the total amounts available under the credit facilities were $16.5
million and $17.1 million, respectively, and the total amounts outstanding were $17.1 million and $14.7 million, respectively, of which $10.1 million and $9.2 million, respectively related to our Miami Operations credit facility and $7.0 million and
$5.5 million, respectively related to our In-country Operations credit facilities. The increase in the outstanding balance is primarily attributed to the increased borrowing by SBA from the new three-year revolving credit facility that replaced
SBAs existing revolving credit facility on December 22, 2009. The change was also attributed to increased borrowing by our subsidiaries in Ecuador, Guatemala and Panama, and to a lesser extent, El Salvador, to meet local working capital
requirements, slightly offset by a reduction in the borrowing requirements related to our operations in Peru, Uruguay and Costa Rica.

SBA
 Senior Secured Revolving Credit Facility

On December 22, 2009, SBA closed the Senior
Secured Revolving Credit Facility with Comerica Bank pursuant to SBA and Comerica Banks commitment letter dated October 23, 2009 to replace the existing revolving credit facility with a new three-year revolving credit facility. The
replacement was contingent upon our refinancing of our 11
3/4% Senior Notes and other conditions, all of
which have been met.

The aggregate size of the Senior Secured Revolving Credit Facility is $20.0 million (with a
possible increase of an additional $10.0 million), including $2.0 million of letter of credit commitments and a capital expenditures limit of $1.0 million. The facility matures in January 2013. As of March 31, 2010, SBA had $20.0 million
available under the Senior Secured Revolving Credit Facility. Under the Senior Secured Revolving Credit Facility, at SBAs option, amounts due will bear interest at the daily adjustable LIBOR rate (at no time less than 2.0%) plus 3.5%, unless
in the event of a default when interest will accrue at a rate equal to 3.0% per annum above the otherwise applicable rate. In addition, SBA will pay an administrative fee of $30.0 thousand per annum and a facility fee equal to 0.5% of the
aggregate amount of the revolving credit commitment, payable quarterly in arrears. Additional customary fees will be payable upon the issuance of letters of credit.

The Senior Secured Revolving Credit Facility contains a number of covenants that, among other things, restrict SBAs ability to
(i) incur additional indebtedness; (ii) make certain capital expenditures; (iii) guarantee certain obligations; (iv) create or allow liens on certain assets; (v) make investments, loans or advances; (vi) pay dividends,
make distributions or undertake stock and other equity interest buybacks; (vii) make certain acquisitions; (viii) engage in mergers, consolidations or sales of assets; (ix) use the proceeds of the revolving credit facility for certain
purposes; (x) enter into transactions with affiliates in non-arms length transactions; (xi) make certain payments on subordinated indebtedness; and (xii) acquire or sell subsidiaries. The Senior Secured Revolving Credit Facility
also requires SBA to maintain certain ratios of debt, income, net worth and other restrictive financial covenants.



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Borrowings under the Senior Secured Revolving Credit Facility are secured on a first
priority basis with all the assets of SBA. Amounts borrowed under the facility could be repaid and re-borrowed at any time during the term of the facility. Borrowing capacity is established monthly based on certain parameters established under the
facility. Advances under the facility were provided based on 85.0% of eligible domestic and foreign accounts receivable plus 60.0% of eligible domestic inventory, less any credit facility reserves. The credit facility contained certain financial and
non-financial covenants, including but not limited to, maintenance of a minimum level of tangible effective net worth, as defined and annual limitations on capital expenditures.

As of March 31, 2010 and December 31, 2009, SBAs outstanding draws against the Senior Secured Revolving Credit Facility
were $6.4 million and $5.9 million, respectively, and the remaining amounts available were $9.9 million and $10.8 million, respectively. As of March 31, 2010 and December 31, 2009, SBAs outstanding checks issued in excess of bank
balances were $3.7 million and $3.3 million, respectively, and outstanding stand-by undrawn letters of credit was $1.8 million for both periods. As of March 31, 2010 and December 31, 2009, SBA was in compliance with all of the covenants
under the Senior Secured Revolving Credit Facility.

Intcomex, Inc. 
131/4% Senior Notes

On December 22, 2009, we completed the
13 1/4% Senior Notes Offering of $120.0
million aggregate principal amount of our
13 1/4% Senior Notes due December 15,
2014 with an interest rate of 13.25% per year, payable semi-annually on June 15 and December 15 of each year, commencing on June 15, 2010. The
13 1/4% Senior Notes were offered at an
initial offering price of 94.43% of par, or an effective yield to maturity of approximately 14.875%.

We used the net proceeds from the
13 1/4% Senior Notes Offering to, among other
things, repay outstanding borrowings under our previous revolving credit facility, fund the repurchase, redemption or other discharge of our 11
3/4% Second Priority Senior Secured Notes due
January 15, 2011 (the 11 3/4% Senior
Notes), for which it conducted a tender offer, and for general corporate purposes. The
13 1/4% Senior Notes are guaranteed by all of
our existing and future domestic restricted subsidiaries that guarantee our obligations under the Senior Secured Revolving Credit Facility.

In connection with the
13 1/4% Senior Notes Offering, our Company and
certain of our subsidiaries that guaranteed our obligations (the Guarantors) under the indenture governing the
11 3/4% Senior Notes (the
11 3/4% Senior Notes Indenture)
entered into an indenture (the 13 1/4%
Senior Notes Indenture) with The Bank of New York Mellon Trust Company, N.A., (the Trustee), relating to the
13 1/4% Senior Notes. Our obligations under
the 13 1/4% Senior Notes and the
Guarantors obligations under the guarantees will be secured on a second priority basis by a lien on 100% of the capital stock of certain of ours and each Guarantors directly owned domestic restricted subsidiaries; 65% of the capital
stock of ours and each Guarantors directly owned foreign restricted subsidiaries; and substantially all the assets of SBA, to the extent that those assets secure our Senior Secured Revolving Credit Facility with Comerica Bank, subject to
certain exceptions.

Subject to certain requirements, we are
required to redeem $5.0 million aggregate principal amount of the 13
1/4% Senior Notes on December 15 of each of
the years 2011 and 2012 and $10.0 million aggregate principal amount of the
13 1/4% Senior Notes on December 15,
2013, at a redemption price equal to 100% of the aggregate principal amount of the 13
1/4% Senior Notes to be redeemed, plus accrued and
unpaid interest to the redemption date subject to certain requirements. We may redeem the
13 1/4% Senior Notes, in whole or in part, at
any time on or after December 15, 2012 at a price equal to 100% of the aggregate principal amount of the
13 1/4% Senior Notes plus a
make-whole premium (106.625% in 2012 and 100.0% in 2013 and thereafter). At any time prior to December 15, 2012, we are required to redeem up to 35% of the aggregate principal amount of the
13 1/4% Senior Notes with the net cash
proceeds of certain equity offerings if an initial public offering occurs on or prior to December 15, 2012 at a price equal to 113.25% of the principal amount of the
13 1/4% Senior Notes. In addition, at our
option, we may redeem up to 10% of the original aggregate principal amount of the
13 1/4% Senior Notes three different times at
$103.00 (but no more than once in any 12-month period).

The indenture governing our
13 1/4% Senior Notes imposes operating and
financial restrictions on us. These restrictive covenants limit our ability, among other things to (i) incur additional indebtedness or enter into sale and leaseback obligations; (ii) pay certain dividends or make certain distributions on
our capital stock or repurchase our capital stock; (iii) make certain investments or other restricted payments; (iv) place restrictions on the ability of subsidiaries to pay dividends or make other payments to us; (v) engage in
transactions with shareholders or affiliates; (vi) sell certain assets or merge with or into other companies; (vii) guarantee indebtedness; and (vii) create liens. We may only pay a dividend if we are in compliance with all covenants
and restrictions in the Indenture prior to and after payment of a dividend.



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Also on December 22, 2009, in connection with the
13 1/4% Senior Notes Offering, certain of our
Companys existing shareholders and their affiliates contributed $20.0 million of new capital in exchange for 27,175 newly-issued shares of our Companys common stock. The capital contribution consisted of the redemption and cancellation
of $15.1 million face value of the 11 3/4%
Senior Notes, $0.9 million of tender premium paid on the settlement of the
11 3/4% Senior Notes and additional cash of
$4.0 million.

As of March 31, 2010 and December 31, 2009, $113.7 million
and $113.3 million, respectively, of our
131/4% Senior Notes remained outstanding. As of March 31, 2010 and December 31, 2009, we were in compliance with all of the covenants
and restrictions under the
131/4% Senior Notes.

Intcomex, Inc.  11
3/4% Senior Notes

On August 25, 2005, we consummated a $120.0 million high yield notes offering in aggregate principal amount of
the
113/4% Senior Notes. The
113/4% Senior Notes were sold at 99.057% of face value and carry a coupon rate of
113/4% and are a second priority senior secured obligation of ours due January 15, 2011. The proceeds of the offering were used to repay
existing indebtedness, pay a dividend to shareholders, and pay fees and expenses associated with the debt offering with the remaining balance to be used for general corporate purposes. The
113/4% Senior Notes were secured on a second
priority basis with 100.0% of the common shares of Holdings and Intcomex Mexico, and 65.0% of the shares of IXLA plus a second priority lien on the assets of SBA.

On December 22, 2009, our Company, the Trustee and the Guarantors executed a second supplemental indenture (the
11 3/4% Senior Notes Second Supplemental
Indenture) as a result of the receipt of tenders and related consents from the holders of at least two thirds in principal amount of the 11
3/4% Senior Notes, in response to our tender offer
and consent solicitation. The 11 3/4% Senior Notes
Second Supplemental Indenture amends the indenture governing the 11
3/4% Senior Notes to delete or make less
restrictive substantially all of the restrictive covenants contained in such indenture (other than requirements to make an offer for the 11
3/4% Senior Notes in the event of certain asset
sales), to delete events of default relating to covenant defaults, cross-defaults and judgments against us, to make conforming and related changes to the indenture and to reduce the minimum redemption notice period from 30 days to three days.

As of March 31, 2010, there were no
113/4% Senior Notes outstanding. As of December 31, 2009, $1.4 million of the
113/4% Senior Notes not tendered in the early tender redemption period remained outstanding and were redeemed through payment to the Trustee for
settlement on January 15, 2010, in accordance with the terms of the
11 3/4% Senior Notes Second Supplemental
Indenture. As of December 31, 2009, we were in compliance with all of the covenants and restrictions under the
113/4% Senior Notes.

Critical Accounting Policies and Estimates

Our consolidated financial statements have been prepared in conformity with U.S. GAAP. The preparation of these financial statements
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and
expenses during the reporting period. On an ongoing basis, we evaluate our estimates and judgments related to assets, liabilities, contingent assets and liabilities, revenue and expenses. Our estimates are based on our historical experience and a
variety of other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making our estimates about the carrying values of assets and liabilities that are not readily apparent from other sources.
Although we believe our estimates, judgments and assumptions are appropriate and reasonable based upon available information, these assessments are subject to various other factors. Actual results may differ from these estimates under different
assumptions and conditions.

We believe the following critical accounting policies are affected by our significant judgments
and estimates used in the preparation of our consolidated financial statements.

Revenue Recognition.Revenue is
recognized when persuasive evidence of an arrangement exists, the sales price is fixed or determinable, collection of the related receivable is reasonably assured and delivery has occurred. Delivery to customers has occurred at the point of
shipment, provided that title and risk of loss have transferred and no significant obligations remain. We allow our customers to return defective products for exchange or credit within 30 days of delivery based on the warranty of the Original
Equipment Manufacturer (OEM). An exception is infrequently made for long-standing customers with current accounts, on a case-by-case basis and upon approval by management. A return is recorded in the period of the return because, based
on past experience, these returns are infrequent and immaterial.



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Our revenues are reported net of any sales, gross receipts or value added taxes. Shipping
and handling costs billed to customers are included in revenue and related expenses are included in the cost of revenue.

We
extend a warranty for products to customers with the same terms as the OEMs warranty to us. All product-related warranty costs incurred by us are reimbursed by the OEMs.

Accounts Receivable. We provide allowances for doubtful accounts on our accounts receivable for estimated losses
resulting from our customers inability to make required payments due to changes in our customers financial condition or other unanticipated events, which could result in charges for additional allowances exceeding our expectations. These
estimates require judgment and are influenced by factors including, but not limited to the following: the large number of customers and their dispersion across wide geographic areas; the fact that no single customer accounted for 2.0% or more of our
revenue; the continual credit evaluation of our customers financial condition; the aging of our customers receivables, individually and in the aggregate; the value and adequacy of credit insurance coverage; the value and adequacy of
collateral received from our customers (in certain circumstances); our historical loss experience; and, increases in credit risk due to an economic downturn resulting in our customers inability to obtain capital. Uncollectible accounts are
written-off against the allowance on an annual basis.

Vendor Programs. We receive funds from vendors for price
protection, product rebates, marketing and promotions and competitive programs, which are recorded as adjustments to product costs or selling, general and administrative expenses according to the nature of the program. Some of these programs may
extend over one or more quarterly reporting periods. We recognize rebates or other vendor incentives as earned based on sales of qualifying products or as services are provided in accordance with the terms of the related program. We provide reserves
for receivables on vendor programs for estimated losses resulting from vendors inability to pay or rejections of claims by vendors. These reserves require judgment and are based upon aging and managements estimate of collectability.

Inventories. Our inventory levels are based on our projections of future demand and market conditions. Any
unanticipated decline in demand or technological changes could cause us to have excess or obsolete inventories. On an ongoing basis, we review for estimated excess or obsolete inventories and make provisions for our inventories to reflect their
estimated net realizable value based upon our forecasts of future demand and market conditions. These forecasts require judgment as to future demand and market conditions. If actual market conditions are less favorable than our forecasts, additional
inventory obsolescence provisions may be required. Our estimates are influenced by the following considerations: the availability of protection from loss in value of inventory under certain vendor agreements, the extent of our right to return to
vendors a percentage of our purchases, the aging of inventories, variability of demand due to an economic downturn and other factors, and the frequency of product improvements and technological changes. Rebates earned on products sold are recognized
when the product is shipped to a third party customer and are recorded as a reduction to cost of revenue.

Goodwill, Identifiable Intangible and Other Long-Lived Assets.We review goodwill at least annually for
potential impairment or between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Our annual impairment review requires extensive use of
accounting judgment and financial estimates, including projections about our business, our financial performance and the performance of the market and overall economy. Application of alternative assumptions and definitions could produce
significantly different results. Because of the significance of the judgments and estimates used in the processes, it is likely that materially different amounts could result if different assumptions were made or if the underlying circumstances were
changed.

Our goodwill represents the excess of the purchase price over the fair value of the net assets of acquired
businesses. Potential impairment exists if the fair value of a reporting unit to which goodwill has been allocated is less than the carrying value of the reporting unit. The amount of an impairment loss is recognized as the amount by which the
carrying value of the goodwill exceeds its implied value.

Future changes in the estimates used to conduct the impairment
review, including revenue projections, market values and changes in the discount rate used could cause the analysis to indicate that our goodwill is impaired in subsequent periods and result in a write-off of a portion or all of the goodwill. The
discount rate used is based on our capital structure and, if required, an additional premium on the reporting unit based upon its geographic market and operating environment. The assumptions used in estimating revenue projections are consistent with
internal planning.



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Our intangible assets are presented at cost, net of accumulated amortization. Intangible
assets are amortized on a straight line basis over their estimated useful lives and assessed for impairment. We recognize an impairment of long-lived assets if the net book value of such assets exceeds the estimated future undiscounted cash flows
attributable to such assets. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset for assets to be held and used, or
the amount by which the carrying value exceeds the fair value less cost to dispose for assets to be disposed. Fair value is determined using the anticipated cash flows discounted at a rate commensurate with the risk involved. We test intangible
assets for recoverability whenever events or changes in circumstances indicate that their carrying amount may not be recoverable.

In addition, we review other long-lived assets, principally property, plant and equipment, for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. If the carrying amount of an asset exceeds the assets fair value, we measure and record an impairment loss for the excess. We assess an assets fair value
by determining the expected future undiscounted cash flows of the asset. There are numerous uncertainties and inherent risks in conducting business, such as general economic conditions, actions of competitors, ability to manage growth, actions of
regulatory authorities, pending investigations or litigation, customer demand and risk relating to international operations. Adverse effects from these or other risks may result in adjustments to the carrying value of our other long-lived assets.

There are numerous uncertainties and inherent risks in conducting business, such as but not limited to general economic
conditions, actions of competitors, ability to manage growth, actions of regulatory authorities, pending investigations and/or litigation, customer demand and risk relating to international operations. Adverse effects from these risks may result in
adjustments to the carrying value of our assets and liabilities in the future including, but not necessarily limited to, goodwill.

Income taxes. We account for the effects of income taxes resulting from activities during the current and preceding years.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases as measured by the
enacted tax rates which will be in effect when these differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date under the
law. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized, unless it is more likely than not that such assets will be realized.

We are subject to income and other related taxes in areas in which we operate. When recording income tax expense, certain estimates are
required by management due to timing and the impact of future events on when income tax expenses and benefits are recognized by us. We periodically evaluate our net operating losses and other carryforwards to determine whether gross deferred tax
assets and related valuation allowances should be adjusted for future realization in our consolidated financial statements.

Highly certain tax positions are determined based upon the likelihood of the positions sustained upon examination by the taxing
authorities. The benefit of a tax position is recognized in the financial statements in the period during which management believes it is more likely than not that the position will be sustained.

In the event of a distribution of the earnings of certain international subsidiaries, we would be subject to withholding taxes payable on
those distributions to the relevant foreign taxing authorities. Since we currently intend to reinvest undistributed earnings of these international subsidiaries indefinitely, we have made no provision for income taxes that might be payable upon the
remittance of these earnings. We have also not determined the amount of tax liability associated with an unplanned distribution of these permanently reinvested earnings. In the event that in the future we consider that there is a reasonable
likelihood of the distribution of the earnings of these international subsidiaries (for example, if we intend to use those distributions to meet our liquidity needs), we will be required to make a provision for the estimated resulting tax liability,
which will be subject to the evaluations and judgments of uncertainties described above.

We conduct business globally and, as
a result, one or more of our subsidiaries file income tax returns in U.S. federal, state and foreign jurisdictions. In the normal course of business, we are subject to examination by taxing authorities in the countries in which we operate. We are
currently under ongoing tax examinations in several countries. While such examinations are subject to inherent uncertainties, we do not currently anticipate that any such examination would have a material adverse impact on our audited consolidated
financial statements.



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Commitments and Contingencies.We accrue for contingent obligations when the
obligation is probable and the amount is reasonably estimable. As facts concerning contingencies become known, we reassess our position and make appropriate adjustments to the financial statements. Estimates that require judgment and are
particularly sensitive to future changes include those related to taxes, legal matters, the imposition of international governmental monetary, fiscal or other controls, changes in the interpretation and enforcement of international laws (in
particular related to items such as duty and taxation), and the impact of local economic conditions and practices, which are all subject to change as events evolve and as additional information becomes available.

As part of our normal course of business, we are involved in certain claims, regulatory and tax matters. In the opinion of our
management, the final disposition of such matters will not have a material adverse impact on our results of operations and financial condition.



|Item 3. | Quantitative and Qualitative Disclosures About Market Risk.
|------- | -----------------------------------------------------------

There have been no material changes in our quantitative and qualitative disclosures about market risk during the fiscal quarter covered by
this Quarterly Report from those disclosed in our Annual Report. For a detailed discussion of the quantitative and qualitative disclosures about market risk, see Part II. Item 7A. Quantitative and Qualitative Disclosures About Market
Risk in our Companys Annual Report.



|Item 4T. | Controls and Procedures.
|-------- | ------------------------

Evaluation of Disclosure Controls and Procedures.Under the supervision and with the participation of management,
including the Companys principal executive officer and principal financial officer, the Company has evaluated the effectiveness of its disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act
for the end of the period covered by this Quarterly Report. Based on that evaluation, the Companys principal executive officer and principal financial officer have concluded as of March 31, 2010, that these controls and procedures were
effective to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC, and is
accumulated and communicated to management, including the principal executive officer and the principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting. There were no changes in our internal control over financial
reporting that occurred during the quarterly period ended March 31, 2010, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



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Part II  OTHER INFORMATION



|Item 1. | Legal Proceedings.
|------- | ------------------

As of
March 31, 2010, the Company had no material legal proceedings pending. From time to time, we are the subject of legal proceedings arising in the ordinary course of business. We do not believe that any proceedings currently pending or threatened
will have a material adverse affect on our business or results of operations.



|Item 1A. | Risk Factors.
|-------- | -------------

In
addition to the other information set forth in this Quarterly Report, readers should carefully consider the risk factors discussed in Part IFinancial Information, 1A. Risk Factors in the Companys Annual Report on Form 10-K
(Annual Report) for the year ended December 31, 2009, filed on February 22, 2010, which could materially affect our business, future results of operations and financial condition. The risk factors described in the Companys Annual
Report may not be the only risks facing our Company. Additional risks and uncertainties that we currently deem to be immaterial or are not currently known to us may also materially and adversely affect our business, consolidated results of
operations and financial condition.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds.
|------- | ------------------------------------------------------------

Not applicable.



|Item 3. | Defaults Upon Senior Securities.
|------- | --------------------------------

Not applicable.



|Item 5. | Other Information.
|------- | ------------------

Not
applicable.



|Item 6. | Exhibits.
|------- | ---------



|            |  |                                                                                                                                                     
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                         
|            | 
|31.1        |  | Certification of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*                                               
|            | 
|31.2        |  | Certification of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*                                               
|            | 
|32.1        |  | Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
|            | 
|32.2        |  | Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*



|* | Filed herewith.
|- | ---------------



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.



|                      |  |                                       |  |             
|--------------------- |  | ------------------------------------- |  | ------------
|Signature             |  | Title                                 |  | Date        
|                      |  |                                      
|/s/ Anthony Shalom    |  |                                       |  | May 14, 2010
|Anthony Shalom        |  | Chairman of the Board of Directors    |  |             
|                      |  |                                      
|/s/ Michael F. Shalom |  |                                       |  |             
|Michael F. Shalom     |  | President and Chief Executive Officer |  | May 14, 2010
|                      |  |                                      
|/s/ Russell A. Olson  |  |                                       |  |             
|Russell A. Olson      |  | Chief Financial Officer               |  | May 14, 2010



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Exhibit Index



|            |  |                                                                                                                                                    
|----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                        
|            | 
|31.1        |  | Certification of Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                               
|            | 
|31.2        |  | Certification of Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                               
|            | 
|32.1        |  | Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|            | 
|32.2        |  | Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.



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