10-Q

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 quarter ended October 31, 2003

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 0-14625

TECH DATA CORPORATION

(Exact name of registrant as specified in its charter)

Florida	No. 59-1578329
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
5350 Tech Data Drive	33760
Clearwater, Florida	(Zip Code)
(Address of principal executive offices)

Registrant’s telephone number, including area code: (727) 539-7429

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 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 is an accelerated filer (as defined in Rule 12b-2 of the 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.

Class	Outstanding at November 6, 2003
Common stock, par value $.0015 per share	56,969,727

TECH DATA CORPORATION AND SUBSIDIARIES

Form 10-Q for the Three and Nine Months Ended October 31, 2003

INDEX

			PAGE
PART I.	FINANCIAL INFORMATION
	Item 1.	Financial Statements
		Consolidated Balance Sheet as of October 31, 2003 (unaudited) and January 31, 2003	1
		Consolidated Statement of Income (unaudited) for the Three and Nine Months Ended October 31, 2003 and 2002	2
		Consolidated Statement of Cash Flows (unaudited) for the Nine Months Ended October 31, 2003 and 2002	3
		Notes to Consolidated Financial Statements (unaudited)	4
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
	Item 4.	Controls and Procedures	27
PART II.	OTHER INFORMATION
	Item 1.	Legal Proceedings	29
	Item 2.	Changes in Securities and Use of Proceeds	29
	Item 3.	Defaults Upon Senior Securities	29
	Item 4.	Submission of Matters to a Vote of Security Holders	29
	Item 5.	Other Information	29
	Item 6.	Exhibits and Reports on Form 8-K	29
SIGNATURES			30

PART I.    FINANCIAL INFORMATION

ITEM 1.    Financial Statements

TECH DATA CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(In thousands, except share amounts)

	October 31, 2003		January 31, 2003
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	121,435	$	157,191
Accounts receivable, less allowance for doubtful accounts of $68,879 and $60,307		2,045,325		1,714,902
Inventories		1,290,038		997,875
Prepaid and other assets		109,095		108,150
Total current assets		3,565,893		2,978,118
Property and equipment, net		154,499		136,689
Excess of cost over fair value of acquired net assets, net		101,099		2,966
Other assets, net		176,889		130,245
Total assets	$	3,998,380	$	3,248,018
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Revolving credit loans	$	229,818	$	188,309
Accounts payable		1,545,447		1,073,357
Accrued expenses		376,796		317,169
Total current liabilities		2,152,061		1,578,835
Long-term debt		314,654		314,498
Other long-term liabilities		22,212		16,155
Total liabilities		2,488,927		1,909,488
Commitments and contingencies (Note 10)
Shareholders’ equity:
Preferred stock, par value $.02; 226,500 shares authorized; none issued and outstanding; liquidation preference $.20 per share		—		—
Common stock, par value $.0015; 200,000,000 shares authorized; 56,968,040 and 56,483,572 issued and outstanding		85		85
Additional paid-in capital		664,105		652,928
Retained earnings		710,419		645,190
Accumulated other comprehensive income		134,844		40,327
Total shareholders’ equity		1,509,453		1,338,530
Total liabilities and shareholders’ equity	$	3,998,380	$	3,248,018

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements

1

TECH DATA CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

(UNAUDITED)

(In thousands, except per share amounts)

	Three months ended October 31,						Nine months ended October 31,
	2003			2002			2003			2002
Net sales	$	4,395,003		$	3,810,719		$	12,487,611		$	11,727,858
Cost of products sold		4,149,917			3,603,831			11,797,947			11,101,405
Gross profit		245,086			206,888			689,664			626,453
Selling, general and administrative expenses		203,481			152,863			582,428			462,056
Special charges (see Note 11)		—			—			3,065			—
Operating income		41,605			54,025			104,171			164,397
Interest expense		5,472			8,047			15,823			25,795
Interest income		(1,925	)		(4,001	)		(4,956	)		(8,948	)
Net foreign currency exchange (gain) loss		(384	)		985			(1,238	)		(6,480	)
Income before income taxes		38,442			48,994			94,542			154,030
Provision for income taxes		11,920			16,168			29,313			50,803
Net income	$	26,522		$	32,826		$	65,229		$	103,227
Earnings per common share:
Basic	$	.47		$	.58		$	1.15		$	1.84
Diluted	$	.46		$	.57		$	1.14		$	1.77
Weighted average common shares outstanding:
Basic		56,877			56,447			56,708			56,183
Diluted		57,781			62,382			57,229			62,548

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements

2

TECH DATA CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

(In thousands)

	Nine months ended October 31,
	2003			2002
Cash flows from operating activities:
Cash received from customers	$	12,445,481		$	11,895,172
Cash paid to suppliers and employees		(12,230,482	)		(11,508,523	)
Interest paid		(9,979	)		(12,199	)
Income taxes paid		(33,272	)		(44,148	)
Net cash provided by operating activities		171,748			330,302
Cash flows used in investing activities:
Acquisition of businesses, net of cash acquired		(201,300	)		(1,125	)
Proceeds from sale of property and equipment		4,484			—
Expenditures for property and equipment		(25,861	)		(22,418	)
Software development costs		(16,171	)		(26,410	)
Net cash used in investing activities		(238,848	)		(49,953	)
Cash flows from financing activities:
Proceeds from the issuance of common stock, net of related tax benefit		9,980			27,721
Net borrowings (repayments) under revolving credit loans		20,236			(84,704	)
Principal payments on long-term debt		(1,089	)		(899	)
Net cash provided by (used in) financing activities		29,127			(57,882	)
Effect of exchange rate changes on cash		2,217			16,354
Net (decrease) increase in cash and cash equivalents		(35,756	)		238,821
Cash and cash equivalents at beginning of period		157,191			257,927
Cash and cash equivalents at end of period	$	121,435		$	496,748
Reconciliation of net income to net cash provided by operating activities:
Net income	$	65,229		$	103,227
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		39,234			38,069
Provision for losses on accounts receivable		18,552			22,803
Changes in assets and liabilities:
Accounts receivable		(42,130	)		167,314
Inventories		(153,618	)		20,179
Prepaid and other assets		(10,006	)		(48,176	)
Accounts payable		268,071			502
Accrued expenses		(13,584	)		26,384
Total adjustments		106,519			227,075
Net cash provided by operating activities	$	171,748		$	330,302

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements

3

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1—BUSINESS AND BASIS OF PRESENTATION:

Business

Tech Data Corporation (“Tech Data,” or “the Company”) is a leading global provider of information technology (“IT”) products, logistics management, and other value-added services. The Company serves over 100,000 technology resellers throughout the United States, Europe, Canada, Latin America, the Caribbean, the Middle East, and Africa.

Basis of Presentation

The consolidated financial statements and related notes included herein have been prepared by Tech Data, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These financial statements should be read in conjunction with the consolidated financial statements and notes thereto filed with the SEC in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2003. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments, except as disclosed herein) necessary to present fairly the financial position of Tech Data and its subsidiaries as of October 31, 2003, and the results of their operations for the three and nine months ended October 31, 2003 and 2002, and their cash flows for the nine months ended October 31, 2003 and 2002. All significant intercompany accounts and transactions have been eliminated in consolidation. In addition, certain prior year balances have been reclassified to conform to the current period presentation.

Seasonality

The Company’s quarterly operating results have fluctuated significantly in the past and will likely continue to do so in the future as a result of seasonal variations in the demand for the products and services it offers. Narrow operating margins may magnify the impact of these factors on the Company’s operating results. Specific historical seasonal variations have included a reduction of demand in Europe during the summer months and an increase in European demand during the Company’s fiscal fourth quarter. The product cycle of major products and any company acquisition or disposition may also materially impact the Company’s business, financial condition, or results of operations. Therefore, the results of operations for the nine months ended October 31, 2003 are not necessarily indicative of the results that can be expected for the entire fiscal year ending January 31, 2004.

NOTE 2—RECENT ACCOUNTING PRONOUNCEMENTS:

In January 2003, the Financial Accounting Standards Board (“FASB”) issued Interpretation (“FIN”) No. 46, “Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51.” In general, a variable interest entity (“VIE”) is any legal structure used for business purposes that either (a) does not have equity investors with voting rights, or (b) has equity investors that do not provide sufficient financial resources for the entity to support its activities. FIN No. 46 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss from the VIE’s activities or is entitled to receive a majority of the VIE’s residual returns, or both. As further explained within Note 10, the Company has determined that the third-party lessor of its synthetic lease facility does not meet the criteria of a VIE and, therefore, is not subject to the consolidation provisions of FIN No. 46.

4

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In December 2002, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 148, “Accounting for Stock-Based Compensation-Transition and Disclosure.” SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No. 148 requires prominent annual and interim disclosures of the pro forma effect of using the fair value method of accounting for stock-based employee compensation. The disclosure requirements of SFAS No. 148 are effective for fiscal years ended after December 15, 2002, and therefore, are included in the financial statements presented herein. While SFAS No. 148 allows for a voluntary change to the fair value based method of accounting for stock-based employee compensation, the Company continues to use the recognition and measurement principles of Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations for those plans. However, the Company is currently analyzing alternative stock-based employee compensation programs, its accounting policies for these programs, and their impact, if any, upon the Company’s consolidated financial position and results of operations.

In April 2003, the FASB issued SFAS No. 149, “Amendment of Statement 133 on Derivative Instruments and Hedging Activities,” which amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts. The provisions of SFAS No. 149 were effective, on a prospective basis, for contracts entered into or modified after June 30, 2003 and for hedging relationships designated after June 30, 2003. The adoption of SFAS No. 149 did not have a significant impact on the Company’s consolidated financial position or results of operations during the period.

In May 2003, the FASB issued SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity” which was effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective for the Company’s third quarter of fiscal 2004. For financial instruments created before the issuance of SFAS No. 150 and still existing at August 1, 2003, the effect of any change will be reported as a cumulative effect of a change in accounting principle. This Statement establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The adoption of SFAS No. 150 did not have a significant impact on the Company’s consolidated financial position or results of operations during the period.

5

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 3—EARNINGS PER COMMON SHARE (“EPS”):

Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding during the reported period. Diluted EPS reflects the potential dilution that could occur, assuming the conversion of the convertible subordinated notes and exercise of stock options using the if-converted and treasury stock methods, respectively. The composition of basic and diluted earnings per common share was as follows (in thousands, except per share amounts):

	2003					2002
	Net Income		Weighted Average Shares	Per Share Amount		Net Income		Weighted Average Shares	Per Share Amount
Three months ended October 31:
Basic EPS	$	26,522	56,877	$	.47	$	32,826	56,447	$	.58
Effect of dilutive securities:
Stock options		—	904				—	602
5% convertible subordinated notes		—	—				2,513	5,333
Diluted EPS	$	26,522	57,781	$	.46	$	35,339	62,382	$	.57
Nine months ended October 31:
Basic EPS	$	65,229	56,708	$	1.15	$	103,227	56,183	$	1.84
Effect of dilutive securities:
Stock options		—	521				—	1,032
5% convertible subordinated notes		—	—				7,538	5,333
Diluted EPS	$	65,229	57,229	$	1.14	$	110,765	62,548	$	1.77

At October 31, 2003 and 2002, there were 2,692,655 and 3,084,272 shares, respectively, excluded from the computation of diluted EPS because their effect would have been anti-dilutive.

In addition, the dilutive impact of the $290.0 million of convertible subordinated debentures, due 2021, is excluded from all diluted EPS calculations above because the conditions of the contingent conversion feature were not met during the reporting periods. The contingent conversion feature requires inclusion of the dilutive impact of the debentures when the market price of Tech Data common stock exceeds a specified percentage, beginning at 120% and declining 1/2% each year until it reaches 110% at maturity, of the conversion price per share of common stock. Holders may convert debentures into 16.7997 shares per $1,000 principal amount of debentures, equivalent to a conversion price of $59.53 per share. For further discussion of these debentures see Note 9.

For the three and nine months ended October 31, 2002, the Company had $300.0 million of convertible subordinated debentures outstanding, bearing interest at 5% per year. The debentures were convertible into 5,333,100 shares of the Company’s stock at a conversion price of approximately $56.25 per share. In December 2002, the Company redeemed the debentures at a price of 101%, or $303.0 million, plus interest accrued to the redemption date.

Accounting for Stock-Based Compensation

At October 31, 2003, the Company had four stock-based employee compensation plans. The Company applies the recognition and measurement principles of APB Opinion No. 25, and related interpretations in accounting for its plans. Additionally, the Company has adopted the disclosure

6

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

provisions of SFAS No. 148, “Accounting for Stock-Based Compensation—Transition and Disclosure,” which amends SFAS No. 123, “Accounting for Stock- Based Compensation.” SFAS No. 148 allows for continued use of recognition and measurement principles of APB Opinion No. 25 and related interpretations in accounting for those plans. No stock-based employee compensation expense is reflected in net income as all options granted under those plans had an exercise price equal to the market value of the underlying common stock on the date of grant. The following table illustrates the effect on net income and EPS if the Company had applied the fair value recognition provisions to stock-based employee compensation. Such disclosure is not necessarily indicative of the fair value of stock options that could be granted by the Company in future fiscal years or of the value of all options currently outstanding. The pro forma results were calculated with the use of the Black-Scholes option-pricing model.

	Three months ended October 31,						Nine months ended October 31,
	2003			2002			2003			2002
Net income, as reported	$	26,522		$	32,826		$	65,229		$	103,227
Deduct: Total stock-based employee compensation expense determined under the fair value-based method for all awards, net of related tax effects		(5,139	)		(7,276	)		(16,828	)		(20,903	)
Pro forma net income	$	21,383		$	25,550		$	48,401		$	82,324
Earnings per common share:
Basic—as reported	$	.47		$	.58		$	1.15		$	1.84
Basic—pro forma	$	.38		$	.45		$	.85		$	1.47
Diluted—as reported	$	.46		$	.57		$	1.14		$	1.77
Diluted—pro forma	$	.37		$	.45		$	.85		$	1.44

The weighted-average fair value of options granted and the weighted-average assumptions used for the three and nine months ended October 31, 2003 and 2002, respectively, were as follows (results may vary depending on the assumptions applied within the Black-Scholes option-pricing model):

	Three months ended October 31,						Nine months ended October 31,
	2003			2002			2003			2002
Weighted-average fair value of options granted	$	16.99		$	16.23		$	13.06		$	23.78
Weighted-average assumptions:
Expected option term (years)		4.4			4.3			4.4			4.3
Expected volatility		63	%		66	%		66	%		66	%
Risk-free interest rate		2.86	%		4.30	%		2.54	%		4.30	%
Expected dividend yield		0	%		0	%		0	%		0	%

NOTE 4—COMPREHENSIVE INCOME:

Comprehensive income is defined as the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, and is comprised of net income and “other comprehensive income”. The Company’s other comprehensive income is comprised exclusively of changes in the Company’s Cumulative Translation Adjustment (“CTA”) account, including income taxes attributable to those changes.

7

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Comprehensive income, net of taxes, for the three and nine months ended October 31, 2003 and 2002, was as follows (in thousands):

	Three months ended October 31,				Nine months ended October 31,
	2003		2002		2003		2002
Net income	$	26,522	$	32,826	$	65,229	$	103,227
Change in CTA(1)		47,134		13,499		94,517		147,266
Total	$	73,656	$	46,325	$	159,746	$	250,493

⁽¹⁾ For the three month period ended October 31, 2003, no deferred income taxes were recorded in the CTA account. For the nine month period ended October 31, 2003, $5.6 million was recorded. There was no income tax effect for the three and nine month periods ended October 31, 2002.

NOTE 5—SEGMENT INFORMATION:

Tech Data operates predominately in a single industry segment as a distributor of IT products, logistics management, and other value-added services. While the Company operates primarily in one industry, because of its global presence, the Company is managed by its geographic segments. Starting in the first quarter of fiscal 2004, the Company modified its management structure and combined its U.S., Canadian and Latin American operations into the Americas region. The Company’s Canadian and Latin American operations were previously reported separately as the Other International region. As a result, the Company’s geographic segments include 1) the Americas (United States, Canada, Latin America and export sales to Latin America and the Caribbean from the U.S.) and 2) Europe (Europe, Middle East, and export sales to Africa). Prior year amounts have been reclassified to conform to the current period presentation. The Company assesses performance of and makes decisions on how to allocate resources to its operating segments based on multiple factors including current and projected operating income and market opportunities.

8

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Financial information by geographic segment was as follows (in thousands):

	Three months ended October 31,				Nine months ended October 31,
	2003		2002		2003		2002
Net sales to unaffiliated customers
Americas	$	2,056,006	$	2,034,105	$	5,918,613	$	6,455,748
Europe		2,338,997		1,776,614		6,568,998		5,272,110
Total	$	4,395,003	$	3,810,719	$	12,487,611	$	11,727,858
Operating income
Americas	$	35,719	$	44,147	$	87,821	$	127,197
Europe		5,886		9,878		16,350		37,200
Total	$	41,605	$	54,025	$	104,171	$	164,397
Depreciation and amortization
Americas	$	4,798	$	6,457	$	15,431	$	22,037
Europe		8,680		5,610		23,803		16,032
Total	$	13,478	$	12,067	$	39,234	$	38,069
Capital expenditures
Americas	$	2,456	$	12,826	$	10,780	$	19,907
Europe		10,747		11,409		31,252		28,921
Total	$	13,203	$	24,235	$	42,032	$	48,828
Identifiable assets
Americas	$	1,431,468	$	1,598,251	$	1,431,468	$	1,598,251
Europe		2,566,912		2,192,683		2,566,912		2,192,683
Total	$	3,998,380	$	3,790,934	$	3,998,380	$	3,790,934
Excess of cost over fair value of acquired net assets, net
Americas	$	2,966	$	8,846	$	2,966	$	8,846
Europe		98,133		300,453		98,133		300,453
Total	$	101,099	$	309,299	$	101,099	$	309,299

NOTE 6—ACQUISITIONS AND DISPOSITIONS:

Acquisitions

Effective March 31, 2003, Tech Data acquired all of the outstanding stock of UK-based Azlan Group PLC (“Azlan”), a European distributor of networking and communications products and provider of training and other value-added services. Shareholders of Azlan received 125 pence per ordinary share, resulting in total cash consideration of approximately 144.7 million pounds sterling ($224.4 million), which the Company funded from its existing credit facilities.

The Azlan acquisition strengthens Tech Data’s position in Europe with respect to networking products and value-added services and was accounted for using the purchase method in accordance with SFAS No. 141, “Business Combinations”. In accordance with SFAS No. 141, the net assets and results of operations of Azlan have been included in Tech Data’s consolidated financial statements

9

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

since the date of acquisition. The purchase price of Azlan has been preliminarily allocated to the estimated fair values of assets acquired and liabilities assumed based on management’s initial estimates (see Note 7 for a roll-forward of the excess of cost over fair value of acquired net assets). The Company’s management is in the process of finalizing the purchase price allocation and determining the existence and value of other intangible assets acquired; accordingly, certain purchase price allocations are subject to change. Based on preliminary independent appraisals, the Company has allocated approximately $25 million of the purchase price to the value of Azlan’s customer list and trademarks. The finalization of these appraisals, which will be completed prior to the end of fiscal 2004, may result in either a significant increase or decrease in currently recorded amounts. In addition, deferred tax assets and liabilities will also be finalized after the final allocation of the purchase price.

The following unaudited pro forma financial information presents results as if the acquisition had occurred at the beginning of the first quarter of fiscal 2003 (in thousands, except per share amounts):

	Three months ended October 31,				Nine months ended October 31,
	2003		2002		2003		2002
Pro forma net sales	$	4,395,003	$	4,035,274	$	12,660,357	$	12,395,392
Pro forma net income	$	26,522	$	33,211	$	66,685	$	107,642
Earnings per common share:
Basic—pro forma	$	.47	$	.59	$	1.18	$	1.92
Diluted—pro forma	$	.46	$	.57	$	1.17	$	1.84

This pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the acquisition taken place at the beginning of fiscal 2003.

In addition, during the first semester of fiscal 2004, the Company acquired two small distributors in France in the areas of CAD/graphics and storage solutions.

Dispositions

During the first semester of fiscal 2003, the Company made the decision to close its operations in Norway and Hungary. Charges and other operating losses from exiting Norway and Hungary totaled approximately $2.4 million and $2.0 million, respectively, during the first semester of fiscal 2003.

NOTE 7—GOODWILL AND OTHER INTANGIBLE ASSETS:

In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets,” the Company performs its annual test of goodwill at the end of each fiscal year to determine if impairment has occurred. This testing includes the determination of each reporting unit’s fair value using market multiples and discounted cash flows modeling. At the end of fiscal 2003, a $328.9 million non-cash impairment charge was recorded. No impairment has been identified or recorded during fiscal 2004.

10

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The changes in the excess of cost over fair value of acquired net assets for the three and nine months ended October 31, 2003, were as follows (in thousands):

	Americas		Europe			Total
Balance as of January 31, 2003	$	2,966	$	—		$	2,966
Excess of cost over fair value of acquired net assets, net(1)		—		110,197			110,197
Other(2)		—		3,063			3,063
Balance as of April 30, 2003	$	2,966	$	113,260		$	116,226
Excess of cost over fair value of acquired net assets, net(1)		—		709			709
Allocation of purchase price(3)		—		(25,000	)		(25,000	)
Other(2)		—		691			691
Balance as of July 31, 2003	$	2,966	$	89,660		$	92,626
Excess of cost over fair value of acquired net assets, net(1)		—		4,627			4,627
Other(2)		—		3,846			3,846
Balance as of October 31, 2003	$	2,966	$	98,133		$	101,099

⁽¹⁾ The addition to Europe’s excess of cost over fair value of acquired net assets primarily relates to the acquisition of Azlan. See Note 6 for more details on acquisitions.

⁽²⁾ “Other” primarily relates to the effect of fluctuations in foreign currencies.

⁽³⁾ Amount relates to the revision of the preliminary purchase price allocation for the Azlan acquisition, which resulted in a reallocation from excess of cost over fair value of acquired net assets into other assets (see Note 6).

Included within other assets are intangible assets as follows (in thousands):

	As of October 31, 2003						As of January 31, 2003
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Amortized intangible assets:
Capitalized software and development costs	$	158,273	$	84,003	$	74,270	$	123,742	$	62,931	$	60,811
Customer list and trademarks		36,468		6,552		29,916		9,877		4,474		5,403
Other intangible assets		522		377		145		680		428		252
Total	$	195,263	$	90,932	$	104,331	$	134,299	$	67,833	$	66,466

Amortization expense for the three and nine months ended October 31, 2003 amounted to $4.2 million and $11.0 million, respectively. Estimated amortization expense for current and succeeding fiscal years is as follows (in thousands):

Fiscal year:
2004	$	14,900
2005		14,300
2006		11,800
2007		9,400
2008		7,900

11

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company capitalized intangible asset expenditures for software and development costs of $4.7 million and $16.2 million for the three and nine months ended October 31, 2003, respectively, with a weighted average amortization period of approximately eight years for both. In addition, the Company allocated approximately $25 million of the Azlan purchase price to the value of Azlan’s customer list and trademarks (see Note 6).

NOTE 8—SUPPLEMENTAL CASH FLOW INFORMATION:

Short-term investments, which have an original maturity of ninety days or less, are considered cash equivalents in the statement of cash flows.

The Company recorded income tax benefits of approximately $1.2 million and $4.9 million during the nine months ended October 31, 2003 and 2002, respectively, related to the exercise of nonqualified employee stock options.

NOTE 9—REVOLVING CREDIT LOANS AND LONG-TERM DEBT:

Revolving Credit Loans

	October 31, 2003		January 31, 2003
	(In thousands)
Receivables Securitization Program, expiring August 27, 2004	$	81,050	$	150,000
Multi-currency Revolving Credit Facility, expiring May 7, 2006		—		23,558
Other revolving credit facilities, expiring on various dates throughout fiscal 2004 and 2005		148,768		14,751
Total	$	229,818	$	188,309

The Company has an agreement (the “Receivables Securitization Program”) with a syndicate of banks that allows the Company to transfer an undivided interest in a designated pool of U.S. accounts receivable on an ongoing basis to provide borrowings up to a maximum of $400.0 million. Under this program, which expires in August 2004, the Company legally isolated certain U.S. trade receivables into a wholly-owned, bankruptcy-remote special purpose entity totaling $572.8 million and $583.0 million at October 31, 2003 and January 31, 2003, respectively. As collections reduce accounts receivable balances included in the pool, the Company may transfer interests in new receivables to bring the amount available to be borrowed up to the maximum. The Company pays interest (average rate of 1.83% at October 31, 2003) on advances under the Receivables Securitization Program at designated commercial paper rates plus an agreed-upon margin.

Under the terms of the Company’s Multi-currency Revolving Credit Facility with a syndicate of banks, the Company is able to borrow funds in major foreign currencies up to a maximum of $250.0 million. Under this facility, which expires in May 2006, the Company has provided either a pledge of stock or a guarantee of certain of its significant subsidiaries. The Company pays interest (average rate of 2.60% at October 31, 2003) on advances under this facility at the applicable eurocurrency rate plus a margin based on the Company’s credit ratings. The Company can fix the interest rate for periods of 30 to 180 days under various interest rate options.

In addition to the facilities described above, the Company has additional lines of credit and overdraft facilities totaling approximately $631.9 million at October 31, 2003 to support its worldwide operations (average interest rate on borrowings was 2.51% at October 31, 2003). Most of these facilities are provided on an unsecured, short-term basis and are reviewed periodically for renewal.

12

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The aforementioned credit facilities total approximately $1.3 billion, of which $229.8 million was outstanding at October 31, 2003. The Company’s credit agreements contain warranties and covenants that must be complied with on a continuing basis, including the maintenance of certain financial ratios, restrictions on payment of dividends and restrictions on the amount of common stock that may be repurchased annually. At October 31, 2003, the Company was in compliance with all such covenants. The ability to draw funds under these credit facilities is dependent upon sufficient collateral (in the case of the Receivables Securitization Program) and meeting the aforementioned financial covenants, which limits the Company’s ability to draw the full amount of these facilities. As of October 31, 2003 the maximum amount that could be borrowed under these facilities, in consideration of the availability of collateral and the financial covenants, was approximately $409.7 million. At October 31, 2003, the Company had issued standby letters of credit of $56.0 million. These letters of credit typically act as a guarantee of payment to certain third parties in accordance with specified terms and conditions. The issuance of these letters of credit reduces the Company’s available capacity under these agreements by the same amount.

Long-Term Debt

In December 2001, the Company issued $290.0 million of convertible subordinated debentures due 2021. The debentures bear interest at 2% per year and are convertible into Tech Data’s common stock at any time, if the market price of the common stock exceeds a specified percentage of the conversion price per share of common stock, beginning at 120% and declining 1/2% each year until it reaches 110% at maturity, or in other specified instances. Holders may convert debentures into 16.7997 shares per $1,000 principal amount of debentures, equivalent to a conversion price of approximately $59.53 per share. The debentures are convertible into 4,871,913 shares of the Company’s common stock. Holders have the option to require the Company to repurchase the debentures on any of the fourth, eighth, twelfth or sixteenth anniversary dates from the issue date at 100% of the principal amount plus accrued interest to the repurchase date. The Company has the option to satisfy any debentures submitted for repurchase in either cash and/or the Company’s common stock, provided that shares of common stock at the first purchase date will be valued at 95% of fair market value (as defined in the indenture) and at 97.5% of fair market value for all subsequent purchase dates. The debentures are redeemable in whole or in part for cash, at the Company’s option at any time on or after December 20, 2005. The Company will pay contingent interest on the debentures during specified six-month periods beginning on December 15, 2005, if the market price of the debentures exceeds specified levels. In addition, the dilutive impact of the $290.0 million of convertible subordinated debentures, due 2021, is excluded from the diluted EPS calculations due to the conditions for the contingent conversion feature not being met.

In August 2000, the Company filed a universal shelf registration statement with the SEC for $500.0 million of debt and equity securities. The net proceeds from any issuance are expected to be used for general corporate purposes, including capital expenditures, the repayment or refinancing of debt and to meet working capital needs. As of October 31, 2003, the Company had not issued any debt or equity securities under this registration statement, nor can any assurances be given that the Company will issue any debt or equity securities under this registration statement in the future.

NOTE 10—COMMITMENTS AND CONTINGENCIES:

Contingencies

Prior to fiscal 2004, one of the Company’s European subsidiaries was audited in relation to various value-added tax (“VAT”) matters. As a result of those audits, the subsidiary has received notices of assessment that allege the subsidiary did not properly collect and remit VAT. It is management’s

13

TECH DATA CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

opinion, based upon the opinion of outside legal counsel, that the Company has valid defenses related to these assessments. Although the Company is vigorously pursuing administrative and judicial action to challenge the assessments, no assurance can be given as to the ultimate outcome. The resolution of such assessments could be material to the Company’s operating results for any particular period, depending upon the level of income for such period.

The Company is subject to various other legal proceedings and claims arising in the ordinary course of business. The Company’s management does not expect that the outcome in any of these other legal proceedings, individually or collectively, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

Synthetic Lease Facility

On July 31, 2003, the Company completed a restructuring of its synthetic lease facility with a group of financial institutions (the “Restructured Lease”) under which the Company leases certain logistics centers and office facilities from a third-party lessor. The Restructured Lease expires in 2008, at which time the Company has the following options: renew the lease for an additional five years, purchase the properties at an amount equal to their cost, or remarket the properties. If the Company elects to remarket the properties, it has guaranteed the lessor a percentage of the cost of each of the properties, in an aggregate amount of approximately $121.1 million. At any time during the lease term, the Company may, at its option, purchase up to four of the properties, at an amount equal to each property’s cost.

The Restructured Lease is fully funded at October 31, 2003, in the approximate amount of $141.3 million. The sum of future minimum lease payments under the Restructured Lease at October 31, 2003 was approximately $19.9 million. Properties leased under the Restructured Lease contain a total of approximately 2.5 million square feet of space, with land totaling 224 acres.

The Restructured Lease has been accounted for as an operating lease. As discussed in Note 2, FIN No. 46 requires the Company to evaluate whether an entity with which it is involved meets the criteria of a VIE and, if so, whether the Company is required to consolidate that entity. The Company has determined that the third-party lessor of its synthetic lease facility does not meet the criteria of a VIE and, therefore, is not subject to the consolidation provisions of FIN No. 46.

Guarantees

To encourage certain customers to purchase product from the Company, the Company provides financial guarantees to third-party lenders on behalf of those customers. The majority of these guarantees are for an indefinite period of time, where the Company would be required to perform if the customer is in default with the third-party lender. As of October 31, 2003 and January 31, 2003, the aggregate amount of guarantees under these arrangements totaled approximately $14.6 million and $21.8 million, respectively, of which approximately $4.2 million and $10.9 million, respectively, was outstanding. Additionally, the Company believes that, based on historical experience, the likelihood of a payment pursuant to such guarantees is remote. The Company also provides residual value guarantees related to its synthetic lease facility, as noted above.

NOTE 11—SPECIAL CHARGES:

The Company incurred special charges of $3.1 million during the second quarter of fiscal 2004 related to the closure of the Company’s education business in the United States and the restructuring of this business to an outsourced model. These charges primarily include costs associated with employee severance, facility lease terminations and the write-offs of fixed assets associated with the business.

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ITEM 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This Quarterly Report on Form 10-Q, including this Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements, as described in the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements regarding future events and the future results of Tech Data Corporation (“Tech Data,” “we,” “our,” “us,” or “the Company”) are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” 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, 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. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Readers are referred to the cautionary statements and important factors discussed in Exhibit 99-A of our Quarterly Report on Form 10-Q for the quarter ended October 31, 2003 for further information. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Quarterly Data—Seasonality

Our quarterly operating results have fluctuated significantly in the past and will likely continue to do so in the future as a result of seasonal variations in the demand for the products and services we offer. Narrow operating margins may magnify the impact of these factors on our operating results. Specific historical seasonal variations have included a reduction of demand in Europe during the summer months and an increase in European demand during our fiscal fourth quarter. The product cycle of major products and any company acquisition or disposition may also materially impact our business, financial condition, or results of operations. Therefore, the results of operations for the three and nine months ended October 31, 2003 are not necessarily indicative of the results that can be expected for the entire fiscal year ending January 31, 2004.

Results of Operations

Starting in the first quarter of fiscal 2004, we modified our management structure and combined our U.S., Canadian and Latin American operations into the Americas region. Our Canadian and Latin American operations were previously reported separately as the Other International region. Prior year amounts have been reclassified to conform to the current period presentation.

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The following table sets forth our Consolidated Statement of Income as a percentage of net sales derived from the Company’s Consolidated Statement of Income for the three and nine months ended October 31, 2003 and 2002, as follows:

	Percentage of net sales
	Three months ended October 31,				Nine months ended October 31,
	2003		2002		2003		2002
Americas	46.78	%	53.38	%	47.40	%	55.05	%
Europe	53.22		46.62		52.60		44.95
Net sales	100.00		100.00		100.00		100.00
Cost of products sold	94.42		94.57		94.48		94.66
Gross profit	5.58		5.43		5.52		5.34
Selling, general and administrative expenses	4.63		4.01		4.66		3.94
Special charges	—		—		0.03		—
Operating income	0.95		1.42		0.83		1.40
Interest expense	0.13		0.21		0.13		0.22
Interest income	(0.04	)	(0.10	)	(0.04	)	(0.08	)
Net foreign currency exchange (gain) loss	(0.01	)	0.02		(0.01	)	(0.05	)
Income before income taxes	0.87		1.29		0.75		1.31
Provision for income taxes	0.27		0.43		0.23		0.43
Net income	0.60	%	0.86	%	0.52	%	0.88	%

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Non-GAAP Financial Information

The following reconciliation details the adjustments between results calculated using Generally Accepted Accounting Principles (“GAAP”) and the same results reported excluding special charges (“non-GAAP information”). The non-GAAP information is included with the intention of providing investors a more complete understanding of our underlying operational results and trends, but should only be used in conjunction with results reported in accordance with GAAP. We did not incur special charges during the comparable periods in fiscal 2003 (in thousands except per share amounts).

	For the three months ended October 31, 2003								For the nine months ended October 31, 2003
	As Reported under GAAP			Impact of Special Charges		Non-GAAP Financial Measures			As Reported under GAAP			Impact of Special Charges			Non-GAAP Financial Measures
Net sales	$	4,395,003		$	—	$	4,395,003		$	12,487,611		$	—		$	12,487,611
Cost of products sold		4,149,917			—		4,149,917			11,797,947			—			11,797,947
Gross profit		245,086			—		245,086			689,664			—			689,664
Selling, general, and administrative expenses		203,481			—		203,481			582,428			—			582,428
Special charges		—			—		—			3,065			(3,065	)(1)		—
Operating income		41,605			—		41,605			104,171			3,065			107,236
Interest expense		5,472			—		5,472			15,823			—			15,823
Interest income		(1,925	)		—		(1,925	)		(4,956	)		—			(4,956	)
Net foreign currency exchange gain		(384	)		—		(384	)		(1,238	)		—			(1,238	)
Income before income taxes		38,442			—		38,442			94,542			3,065			97,607
Provision for income taxes		11,920			—		11,920			29,313			1,073	(2)		30,386
Net income	$	26,522		$	—	$	26,522		$	65,229		$	1,992		$	67,221
Earnings per common share—diluted	$	.46				$	.46		$	1.14					$	1.17
Weighted average common shares outstanding—diluted		57,781					57,781			57,229						57,229

⁽¹⁾ Charges associated with closure of the U.S. education business (see Note 11 of Notes to Consolidated Financial Statements).

⁽²⁾ Tax effect of deductible special charges.

Net Sales

The following table represents our net sales by geographic segment (in thousands):

	Three months ended October 31,						Nine months ended October 31,
	2003		% Change		2002		2003		% Change		2002
Net sales:
Americas	$	2,056,006	1.1	%	$	2,034,105	$	5,918,613	(8.3	)%	$	6,455,748
Europe		2,338,997	31.7	%		1,776,614		6,568,998	24.6	%		5,272,110
Total	$	4,395,003	15.3	%	$	3,810,719	$	12,487,611	6.5	%	$	11,727,858

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Net sales were $4.4 billion in the third quarter of fiscal 2004, a 15.3% increase over the comparable quarter last year. Net sales for the third quarter of fiscal 2004 in the Americas increased by 1.1%, whereas Europe saw an increase of 31.7% (13.1% on a local currency basis).

On a year-to-date basis, net sales were $12.5 billion in the first nine months of fiscal 2004 compared to $11.7 billion in the comparable period last year, an increase of 6.5% year-over-year. Net sales for the nine-month period in the Americas decreased by 8.3% whereas Europe saw an increase of 24.6% in U.S. dollar terms and an increase of 3.6% on a local currency basis. Excluding Azlan Group PLC (“Azlan”), Europe experienced a slight year-over-year decrease in net sales on a local currency basis during the nine months ended October 31, 2003.

Our year-over-year increase in net sales in Europe during the quarter and year-to-date was driven by the inclusion of the results from Azlan, which was acquired as of March 31, 2003, and the stronger euro versus the U.S. dollar. It is important to note that both our Americas and our “legacy” European operations (i.e., excluding Azlan) experienced a slight year-over-year increase in net sales on a local currency basis during the quarter ended October 31, 2003. This year-over-year increase in net sales during the quarter is primarily due to improving demand conditions in both regions and our desire to maintain and, in some cases, increase our market share position with certain customers and/or vendors, while still achieving acceptable profit margins. These positive achievements were somewhat offset by (a) the decision of certain vendors to pursue a direct sales model, primarily in the United States; (b) declining unit average selling prices; and (c) our exit last year from certain markets in Europe and Latin America. Our year-over-year decline in net sales in the Americas and our legacy European operations on a local currency basis for the nine month period is primarily due to (a) lower demand for technology products and services during the first half of this year; (b) last year’s second quarter results reflecting a non-recurring increase in our Microsoft licensing business related to Microsoft’s Upgrade Advantage and Software Assurance Programs; and (c) those offsetting factors previously discussed above regarding our quarterly performance.

With respect to our European operations, we continue to have challenges in certain markets where our financial performance has not met expectations due to difficult demand conditions and highly competitive pricing unique to particular geographies and, in some cases, our own weak internal execution. We have taken and will continue to take actions to improve our financial performance in these markets; however, certain of these actions require more time than others to generate the desired revenue and/or profitability improvements. In terms of the overall demand climate in the region, although we experienced year-over-year sales growth on a local currency basis during the quarter, we remain cautious about European demand in the future until we see further trends evidencing a firm rebound in information technology (“IT”) spending.

We generated approximately 32% of our net sales in the third quarter of fiscal 2004 from products purchased from Hewlett-Packard Company (“HP”). HP has increased the level of business it transacts directly with end-users and/or resellers. As discussed above, our net sales have been adversely affected by this trend, which has been primarily focused on HP’s computer systems business in the United States. HP’s printer business and European computer systems business have not yet been significantly affected. HP also continues to modify certain contract terms and conditions, some of which may push additional costs into the channel. In response to these changes, we continue to evaluate and modify our pricing policies and terms and conditions with our customers, as well as pursue other vendor and product categories. It should also be noted that the adverse effect of HP’s direct strategy on our U.S. business has not been as dramatic in recent quarters. In each of the last four quarters, our sales of HP computer systems in the U.S. represents less than three percent of our quarterly worldwide sales. While our future exposure in our HP systems business may not be significant, no assurance can be given that we will not be adversely affected should HP proceed with a more aggressive direct strategy within Europe or with its printer business.

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Gross Profit

Gross profit as a percentage of net sales (“gross margin”) during the quarter was 5.58%, an increase of 15 basis points compared to the third quarter of fiscal 2003. On a year-to-date basis, gross margin increased 18 basis points to 5.52% in the first nine months of fiscal 2004 compared to 5.34% in the first nine months of fiscal 2003.

The increase in gross margin is largely the result of the inclusion of the results of Azlan (which realize higher gross margins than our legacy operations) and the impact of our adoption of Emerging Issues Task Force Issue (“EITF”) No. 02-16, “Accounting for Consideration Received from a Vendor by a Customer (Including a Reseller) of the Vendor’s Products,” as discussed below, offset by declining product gross margins in our legacy operations. Our legacy operations experienced a year-over-year decline in gross margins due to the highly competitive pricing environment during the period and our desire to maintain or, in some cases, increase our market share position, as previously discussed above. In addition, as we analyzed business opportunities, our lower cost structure allowed us to realize, in many cases, acceptable operating profits in spite of lower gross margins.

Gross margin within both operating segments during the third quarter and year-to-date period of fiscal 2004 include a reclassification pursuant to EITF Issue No. 02-16. EITF Issue No. 02-16 requires that, under certain circumstances, consideration received from vendors be treated as a reduction of cost of goods sold and not as a reduction of selling, general and administrative expenses. EITF Issue No. 02-16 further requires the recognition of such consideration be deferred until the related inventory is sold. The new guidance is applicable to vendor arrangements entered into or modified subsequent to December 31, 2002. As a result of implementing EITF Issue No. 02-16, during the third quarter, we have reclassified approximately $15.0 million (.34% of net sales) from selling, general and administrative expenses with $13.2 million (.30% of net sales) recorded as a reduction of cost of goods sold and the remaining $1.8 million (.04% of net sales) recorded as deferred revenue (offsetting inventory on the balance sheet) pending sale of the related inventory. On a year-to-date basis, through nine months of fiscal 2004, we have reclassified approximately $29.9 million (.24% of net sales) from selling, general and administrative expenses with $25.6 million (.20% of net sales) recorded as a reduction of cost of goods sold and an aggregate of $4.3 million (.03% of net sales) recorded as deferred revenue (offsetting inventory on the balance sheet) pending sale of the related inventory.

We may see further increases in our gross profit (in absolute dollars and as a percentage of net sales) in future quarters as additional vendor arrangements become subject to EITF Issue No. 02-16. The increase in gross profit would result from the additional reclassification of certain vendor reimbursements from selling, general and administrative expenses to cost of goods sold. In addition, subject to foreign exchange rate volatility, we anticipate an aggregate deferral of approximately $5.0 to $6.0 million on a pretax basis to be established by the end of fiscal 2004. This deferral would relate to vendor reimbursements associated with unsold inventory at the end of fiscal 2004. We expect the guidance to be applicable to virtually all vendor arrangements by the end of fiscal 2004. This guidance does not require prior periods to be adjusted.

Operating Expenses

Selling, general and administrative expenses (“SG&A”)

SG&A during the third quarter amounted to $203.5 million, an increase of $50.6 million or 33.1% compared to the prior year. On a year-to-date basis, SG&A during the first nine months of fiscal 2004 amounted to $582.4 million, an increase of $120.4 million or 26.1% compared to the prior year.

Similar to the increase in net sales and gross profit, the increase in SG&A for the three and nine month periods can be attributed primarily to the inclusion of the results from Azlan, the strengthening of

19

the euro against the U.S. dollar and our adoption of EITF Issue No. 02-16. Also impacting our SG&A this year are the costs we’ve incurred for the harmonization and upgrade of our European computer systems infrastructure (“the Project”). Project costs expensed during the third quarter of fiscal 2004 approximated $5.3 million compared to $3.6 million in the prior year. On a year-to-date basis, we’ve expensed approximately $17.9 million related to the Project, compared to $5.4 million last year. Excluding the above factors, SG&A incurred by our legacy operations actually declined on a year-over-year basis. This SG&A performance was achieved through stringent cost controls and would have been more favorable had we not incurred charges this year associated with workforce reductions significantly in excess of the amount incurred in the prior year.

On a relative basis, SG&A as a percentage of net sales during the third quarter came in at 4.63%, an increase of 62 basis points over the prior year. On a year-to-date basis, SG&A as a percentage of net sales came in at 4.69% during the first nine months of fiscal 2004, an increase of 75 basis points over the prior year. This increase can be attributed to a number of factors, including (a) the inclusion of Azlan, which has a significantly higher cost structure than Tech Data’s legacy operations; (b) the implementation of EITF Issue No. 02-16 as discussed above; and (c) the favorable impact of our cost control measures not fully offsetting the magnitude of our year-over-year decline in net sales.

Special Charges

We incurred special charges of $3.1 million in the second quarter of fiscal 2004 related to the closure of our education business in the United States and the restructuring of this business to an outsourced model. These charges primarily include costs associated with employee severance, facility lease terminations and the write-offs of fixed assets associated with the business.

Non-Operating Income and Expenses

Interest Expense and Interest Income

Interest expense decreased 32.0% to $5.5 million in the third quarter of fiscal 2004 from $8.0 million in the third quarter of the prior year. On a year-to-date basis, interest expense decreased 38.7% to $15.8 million in the first nine months of fiscal 2004 from $25.8 million in the prior year. This decrease was primarily the result of a reduction in our average borrowing rates.

Interest income decreased 51.9% to $1.9 million in the third quarter of fiscal 2004 from $4.0 million in the third quarter of the prior year. On a year-to-date basis, interest income decreased 44.6% to $5.0 million in the first nine months of fiscal 2004 from $8.9 million in the first nine months of the prior year. This decrease was primarily attributable to a decrease in investment yields and in cash available for investment during the periods.

Net Foreign Currency Exchange Gains/Losses

We realized a net foreign currency exchange gain of $0.4 million in the third quarter of fiscal 2004, compared to a loss of $1.0 million in the third quarter of the prior year. On a year-to-date basis, we realized a net foreign currency exchange gain of $1.2 million during the first nine months of fiscal 2004, compared to a net foreign currency exchange gain of $6.5 million in the comparable period last year.

The majority of the fluctuation from the prior year was attributable to our operations in Europe, with the remainder relating to our operations in Latin America. The European gain was attributable to the strengthening of the euro throughout the periods, as many of our payables in the region are denominated in U.S. dollars and are not fully hedged. It continues to be our goal to minimize foreign currency exchange gains and losses through effective hedging techniques. Our foreign currency exchange policy prohibits entering into speculative transactions.

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Provision for Income Taxes

Our effective tax rate was 31% in the third quarter of fiscal 2004 and 33% in the third quarter of fiscal 2003. On a year-to-date basis, our effective tax rate was 31% in the first nine months of fiscal 2004 compared to 33% in the first nine months of the prior year.

The effective tax rate differed from the U.S. federal statutory rate of 35% during these periods primarily due to tax rate benefits of certain earnings from operations in lower-tax jurisdictions throughout the world for which no U.S. taxes have been provided because such earnings are planned to be reinvested indefinitely outside the U.S. The effective tax rates are also impacted by favorable tax audit results, cumulative and current period net operating losses in certain geographic regions, and management’s determination of the related deferred tax asset that is more likely than not to be realized.

Our future effective tax rates could be adversely affected by earnings being lower than anticipated in countries where we have lower statutory rates, changes in the valuation of our deferred tax assets or liabilities, or changes in tax laws or interpretations thereof. In addition, we are subject to the continuous examination of our income tax returns by the Internal Revenue Service and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes.

Net Income and Earnings Per Common Share

As a result of the factors described above, net income in the third quarter of fiscal 2004 decreased 19.2% to $26.5 million, or $0.46 per diluted share, compared to net income of $32.8 million, or $.57 per diluted share in the third quarter of the prior year. On a year-to-date basis, net income in the first nine months of fiscal 2004 decreased 36.8% to $65.2 million, or $1.14 per diluted share, compared to net income of $103.2 million, or $1.77 per diluted share in the prior year.

Excluding the special charges incurred during the first nine months, as discussed above, pro forma net income decreased 34.9% from the prior year to $67.2 million, or $1.17 per diluted share.

Critical Accounting Policies and Estimates

The information included within Management’s Discussion and Analysis of Financial Condition and Results of Operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures. On an on-going basis, we evaluate these estimates, including those related to bad debts, inventory, vendor incentives, goodwill and intangible assets, deferred taxes, and contingencies. Our estimates and judgments are based on currently available information, historical results, and other assumptions we believe are reasonable. Actual results could differ materially from these estimates. We believe the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements.

Accounts Receivable

We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. In estimating the required allowance, we take into consideration the overall quality and aging of the receivable portfolio, the existence of credit insurance and specifically identified customer risks. If actual customer performance were to deteriorate to an extent not expected by us, additional allowances may be required which could have an adverse effect on our financial results.

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Inventory

We value our inventory at the lower of its cost or market value. We write down our inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, foreign currency fluctuations for foreign-sourced product and assumptions about future demand. Market conditions that are less favorable than those projected by management may require additional inventory write-downs, which could have an adverse effect on our financial results.

Vendor Incentives

We receive incentives from vendors related to cooperative advertising allowances, personnel funding, volume rebates and other incentive agreements. These incentives are generally under quarterly, semi-annual or annual agreements with the vendors; however, some of these incentives are negotiated on an ad hoc basis to support specific programs mutually developed between the vendor and Tech Data.

We have historically recorded unrestricted volume rebates and early payment discounts received from vendors as a reduction of inventory and recognized the incentives as a reduction of cost of products sold when the related inventory was sold. With the implementation of EITF Issue No. 02-16, such treatment will be considered for all other incentives we receive from vendors, such as cooperative advertising allowances and personnel funding. The impact of the implementation of EITF No. 02-16 is discussed within the Results of Operations section of this document.

Goodwill and Intangible Assets

The carrying value of goodwill is reviewed annually for impairment. Goodwill may also be reviewed more frequently if current events and circumstances indicate a possible impairment. An impairment loss is charged to expense in the period identified.

We examine the carrying value of our intangible assets with finite lives, which includes capitalized software and development costs and purchased intangibles, as current events and circumstances warrant determining whether there are any impairment losses. If indicators of impairment are present in intangible assets used in operations and future cash flows are not expected to be sufficient to recover the assets’ carrying amount, an impairment loss is charged to expense in the period identified.

Deferred Taxes

We record valuation allowances to reduce our deferred tax assets to the amount expected to be realized. In assessing the adequacy of recorded valuation allowances, we consider a variety of factors, including the scheduled reversal of deferred tax liabilities, future taxable income, and prudent and feasible tax planning strategies. In the event we determine we would be able to use a deferred tax asset in the future in excess of its net carrying value, an adjustment to the deferred tax asset would reduce income tax expense, thereby increasing net income in the period such determination was made. Likewise, should we determine that we are unable to use all or part of our net deferred tax asset in the future, an adjustment to the deferred tax asset would be charged to income tax expense, thereby reducing net income in the period such determination was made.

Contingencies

We accrue for contingent obligations, including estimated legal costs, 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

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are particularly sensitive to future changes include tax, legal and other regulatory matters such as imports and exports, which are subject to change as events evolve and as additional information becomes available during the administrative and litigation process.

Recent Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board (“FASB”) issued Interpretation (“FIN”) No. 46, “Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51.” In general, a variable interest entity (“VIE”) is any legal structure used for business purposes that either (a) does not have equity investors with voting rights or (b) has equity investors that do not provide sufficient financial resources for the entity to support its activities. FIN No. 46 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss from the VIE’s activities or is entitled to receive a majority of the VIE’s residual returns, or both. As further explained within Note 10 of Notes to Consolidated Financial Statements, we have determined that the third-party lessor of the synthetic lease facility does not meet the criteria of a VIE and, therefore, is not subject to the consolidation provisions of FIN No. 46.

In December 2002, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 148, “Accounting for Stock-Based Compensation-Transition and Disclosure.” SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No. 148 requires prominent annual and interim disclosures of the pro forma effect of using the fair value method of accounting for stock-based employee compensation. The disclosure requirements of SFAS No. 148 are effective for fiscal years ended after December 15, 2002, and therefore, are included in the financial statements presented herein. While SFAS No. 148 allows for a voluntary change to the fair value based method of accounting for stock-based employee compensation, we continue to use the recognition and measurement principles of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations for those plans. However, we are currently analyzing alternative stock-based employee compensation programs, our accounting policies for these programs, and their impact, if any, upon our consolidated financial position and results of operations.

In April 2003, the FASB issued SFAS No. 149, “Amendment of Statement 133 on Derivative Instruments and Hedging Activities,” which amends and clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts. The provisions of SFAS No. 149 were effective, on a prospective basis, for contracts entered into or modified after June 30, 2003 and for hedging relationships designated after June 30, 2003. The adoption of SFAS No. 149 did not have a significant impact on our consolidated financial position or results of operations during the period.

In May 2003, the FASB issued SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity” which was effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective for our third quarter of fiscal 2004. For financial instruments created before the issuance of SFAS No. 150 and still existing at August 1, 2003, it will be reported as a cumulative effect of a change in accounting principle. SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The adoption of SFAS No. 150 did not have a significant impact on our consolidated financial position or results of operations during the period.

Liquidity and Capital Resources

Cash Flows

Net cash provided by operating activities of $171.7 million during the first nine months of fiscal 2004 was primarily attributable to net income of $65.2 million combined with a significant increase in vendor financing, which more than covered our increases in accounts receivable and inventory. The

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increase in accounts receivable can be attributed to the strong sales performance during the quarter, especially the latter half of the quarter. The increase in inventory can be attributed to the buildup of inventory in anticipation of higher fourth quarter demand.

Net cash used in investing activities of $238.8 million during the first nine months of fiscal 2004 was primarily attributable to the acquisition of Azlan and the continuing investment related to the expansion of our management information systems, office facilities and equipment for our logistics centers. We expect to make capital expenditures of approximately $50.0-$60.0 million during fiscal 2004 to further expand or upgrade our IT systems, logistics centers and office facilities, which include $13.0-$16.0 million to continue upgrading our European systems infrastructure. We continue to make significant investments to implement new IT systems and upgrade our existing IT infrastructure in order to meet our changing business requirements. These implementations and upgrades occur at various levels throughout our organization and include, but are not limited to, new operating and enterprise systems, financial systems, web technologies, customer relationship management systems and telecommunications. While we believe we will realize increased operating efficiencies as a result of these investments, unforeseen circumstances or complexities could have an adverse impact on our business.

Net cash provided by financing activities of $29.1 million during the first nine months of fiscal 2004 primarily reflects net borrowings on our revolving credit lines, which included $224.4 million to fund the acquisition of Azlan (offset by cash acquired), much of which had been repaid at October 31, 2003 through the use of cash generated from operations.

Liquidity and Capital Resources

As of October 31, 2003, we maintained a $250.0 million Multi-currency Revolving Credit Facility with a syndicate of banks that expires in May 2006. We pay interest (average rate of 2.60% at October 31, 2003) under this facility at the applicable eurocurrency rate plus a margin based on our credit ratings. Additionally, we maintain a $400.0 million Receivables Securitization Program with a syndicate of banks that expires in August 2004. We pay interest (average rate of 1.83% at October 31, 2003) on the Receivables Securitization Program at designated commercial paper rates plus an agreed-upon margin. In addition to these credit facilities, we maintain additional lines of credit and overdraft facilities totaling approximately $631.9 million (average interest rate on borrowings was 2.51% at October 31, 2003).

The aforementioned credit facilities total approximately $1.3 billion, of which $229.8 million was outstanding at October 31, 2003. These credit facilities contain covenants that must be complied with on a continuous basis, including the maintenance of certain financial ratios, restrictions on payment of dividends and restrictions on the amount of common stock that may be repurchased annually. We were in compliance with all such covenants as of October 31, 2003. The ability to draw funds under these credit facilities is dependent upon sufficient collateral (in the case of the Receivables Securitization Program) and meeting the aforementioned financial covenants, which limits our ability to draw the full amount of these facilities. As of October 31, 2003 the maximum amount that could be borrowed under these facilities, in consideration of the availability of collateral and the financial covenants, was approximately $409.7 million. In addition, at October 31, 2003, we had issued standby letters of credit of $56.0 million. These letters of credit typically act as a guarantee of payment to certain third parties in accordance with specified terms and conditions. The issuance of these letters of credit reduces our available capacity under our credit agreements by the same amount. For a more detailed discussion of these credit facilities, see Note 9 of Notes to Consolidated Financial Statements.

In December 2001, we issued $290.0 million of convertible subordinated debentures due 2021. The debentures bear interest at 2% per year and are convertible into our common stock at any time, if the market price of the common stock exceeds a specified percentage of the conversion price per share of common stock, beginning at 120% and declining 1/2% each year until it reaches 110% at

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maturity, or in other specified instances. Holders may convert debentures into 16.7997 shares per $1,000 principal amount of debentures, equivalent to a conversion price of approximately $59.53 per share. The debentures are convertible into 4,871,913 shares of our common stock. Holders have the option to require us to repurchase the debentures on any of the fourth, eighth, twelfth or sixteenth anniversary dates from the issue date at 100% of the principal amount plus accrued interest to the repurchase date. We have the option to satisfy any debentures submitted for repurchase in either cash and/or our common stock, provided that shares of common stock at the first purchase date will be valued at 95% of fair market value (as defined in the indenture) and at 97.5% of fair market value for all subsequent purchase dates. The debentures are redeemable in whole or in part for cash, at our option at any time on or after December 20, 2005. We will pay contingent interest on the debentures during specified six-month periods beginning on December 15, 2005, if the market price of the debentures exceeds specified levels. In addition, the dilutive impact of the $290.0 million of convertible subordinated debentures, due 2021, is excluded from the diluted earnings per share calculations due to the conditions for the contingent conversion feature not being met.

In August 2000, we filed a universal shelf registration statement with the Securities and Exchange Commission (“SEC”) for $500.0 million of debt and equity securities. The net proceeds from any issuance are expected to be used for general corporate purposes, including capital expenditures, the repayment or refinancing of debt and to meet working capital needs. As of October 31, 2003, we had not issued any debt or equity securities under this registration statement, nor can any assurances be given that we will issue any debt or equity securities under this registration statement in the future.

We believe that our existing sources of liquidity, including cash resources and cash provided by operating activities, supplemented as necessary with funds available under our credit arrangements, will provide sufficient resources to meet our present and future working capital and cash requirements for at least the next 12 months.

Synthetic Lease Facility

On July 31, 2003, we completed a restructuring of our synthetic lease facility with a group of financial institutions (the “Restructured Lease”) under which we lease certain logistics centers and office facilities from a third-party lessor. The Restructured Lease expires in 2008, at which time we have the following options: renew the lease for an additional five years, purchase the properties at an amount equal to their cost, or remarket the properties. If we elect to remarket the properties, we have guaranteed the lessor a percentage of the cost of each of the properties, in an aggregate amount of approximately $121.1 million. At any time during the lease term, we may, at our option, purchase up to four of the properties, at an amount equal to each property’s cost.

The Restructured Lease is fully funded at October 31, 2003, in the approximate amount of $141.3 million. The sum of future minimum lease payments under the Restructured Lease at October 31, 2003 was approximately $19.9 million. Properties leased under the Restructured Lease contain a total of approximately 2.5 million square feet of space, with land totaling 224 acres.

The Restructured Lease has been accounted for as an operating lease. As discussed in Note 2 of Notes to Consolidated Financial Statements, FIN No. 46 requires us to evaluate whether an entity with which we are involved meets the criteria of a VIE and, if so, whether we are required to consolidate that entity. We have determined that the third-party lessor entity does not meet the criteria of a VIE and, therefore, is not subject to the consolidation provisions of FIN No. 46.

Asset Management

We manage our inventories by maintaining sufficient quantities to achieve high order fill rates while attempting to stock only those products in high demand with a rapid turnover rate. Inventory balances fluctuate as we add new product lines and when appropriate, we make large purchases,

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including cash purchases from manufacturers and publishers when the terms of such purchases are considered advantageous. Our contracts with most of our vendors provide price protection and stock rotation privileges to reduce the risk of loss due to manufacturer price reductions and slow moving or obsolete inventory. In the event of a vendor price reduction, we generally receive a credit for the impact on products in inventory, subject to certain limitations. In addition, we have the right to rotate a certain percentage of purchases, subject to certain limitations. Historically, price protection and stock rotation privileges, as well as our inventory management procedures have helped to reduce the risk of loss of inventory value.

We attempt to control losses on credit sales by closely monitoring customers’ creditworthiness through our IT systems, which contain detailed information on each customer’s payment history and other relevant information. We have obtained credit insurance that insures a percentage of the credit we extend to certain customers against possible loss. Customers who qualify for credit terms are typically granted net 30-day payment terms. We also sell products on a prepay, credit card, cash on delivery and floor plan basis.

Acquisitions

Effective March 31, 2003, we completed the acquisition of Azlan, a European distributor of networking and communications products and provider of training and other value-added services. Shareholders of Azlan received 125 pence per ordinary share, resulting in total cash consideration of approximately 144.7 million pounds sterling ($224.4 million), which we funded from our existing credit facilities.

Beginning April 1, 2003, we have included Azlan’s operations in our results of operations. The acquisition was accounted for as a purchase in accordance with SFAS No. 141, “Business Combinations.” The purchase price of Azlan has been preliminarily allocated to the estimated fair values of assets acquired and liabilities assumed based on management’s initial estimates. Almost all of the increase in our balance of excess of cost over fair value of acquired net assets during the semester was the result of this acquisition. We are in the process of finalizing the purchase price allocation and determining the existence and value of other intangible assets acquired; accordingly, certain purchase price allocations are subject to change. Based on preliminary independent appraisals, we have allocated approximately $25 million of the purchase price to the value of Azlan’s customer list and trademarks. The finalization of these appraisals, which will be completed prior to the end of fiscal 2004, may result in either a significant increase or decrease in currently recorded amounts. In addition, deferred tax assets and liabilities will also be finalized after the final allocation of the purchase price.

In addition, during the first semester of fiscal 2004, we acquired two small distributors in France in the areas of CAD/graphics and storage solutions.

Cautionary Statements and Risk Factors

In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, Exhibit 99-A to our Quarterly Report on Form 10-Q for the three months ended October 31, 2003 outlines cautionary statements and identifies important factors that could cause our actual results to differ materially from those projected in forward-looking statements we make or are made on our behalf. Such forward-looking statements, as made within this Form 10-Q, should be considered in conjunction with the aforementioned Exhibit 99-A.

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Factors that could cause actual results to differ materially include the following:

• intense competition both domestically and internationally

• narrow profit margins

• inventory risks due to shifts in market demand

• dependence on information systems

• credit exposure due to the deterioration in the financial condition of our customers

• the inability to obtain required capital

• fluctuations in interest rates

• potential adverse effects of acquisitions

• foreign currency exchange rates and exposure to foreign markets

• the impact of changes in income tax legislation

• product supply and availability

• dependence on independent shipping companies

• changes in vendor terms and conditions

• acts of war and terrorism

• exposure to natural disasters

• potential impact of labor strikes

• volatility of common stock

• accuracy of forecast data

Additional discussion of these and other factors affecting our business and prospects is contained in our periodic filings with the Securities and Exchange Commission (“SEC”), copies of which can be obtained at the Investor Relations section of our website at www.techdata.com.

Our principal Internet address is www.techdata.com. We provide our annual and quarterly reports free of charge on www.techdata.com, as soon as reasonably practicable after they are electronically filed, or furnished to, the SEC. We provide a link to all SEC filings where current reports on Form 8-K and any amendments to previously filed reports may be accessed, free of charge.

ITEM 3.    Quantitative and Qualitative Disclosures About Market Risk

For a description of the Company’s market risks, see “Item 7a. Qualitative and Quantitative Disclosures About Market Risk” in its Annual Report on Form 10-K for the fiscal year ended January 31, 2003. No material changes have occurred in the Company’s market risks since January 31, 2003.

ITEM 4.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the specified time periods. As of the end of the period covered by this report, the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) evaluated, with the participation of Tech Data’s management, the

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effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15(d)-15(e) under the Exchange Act). Based on the evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures are effective. Except as further described below, there were no changes in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company is in the process of upgrading its computer systems used for operations in certain of its subsidiaries. The upgrade process will take place over the next several years. As we believe is the case in most system changes, the implementation of these systems has necessitated changes in operating policies and procedures and the related internal controls and their method of application. However, throughout this implementation, there have been no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Limitations on the Effectiveness of Controls

The Company maintains a system of internal control over financial reporting to provide reasonable assurance that assets are safeguarded and that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation of financial statements in accordance with accounting principles generally accepted in the United States. However, the Company’s management, including the CEO and CFO, does not expect that the Company’s disclosure controls or internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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PART II. OTHER INFORMATION

ITEM 1.    Legal Proceedings

Prior to fiscal 2004, one of the Company’s European subsidiaries was audited in relation to various value-added tax (“VAT”) matters. As a result of those audits, the subsidiary has received notices of assessment that allege the subsidiary did not properly collect and remit VAT. It is management’s opinion, based upon the opinion of outside legal counsel, that the Company has valid defenses related to a substantial portion of these assessments. Although the Company is vigorously pursuing administrative and judicial action to challenge the assessments, no assurance can be given as to the ultimate outcome. The resolution of such assessments could be material to the Company’s operating results for any particular period, depending upon the level of income for such period.

The Company is subject to various other legal proceedings and claims arising in the ordinary course of business. The Company’s management does not expect the outcome in any of these other legal proceedings, individually or collectively, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

ITEM 2.    Changes In Securities And Use Of Proceeds

Not applicable.

ITEM 3.    Defaults Upon Senior Securities

Not applicable.

ITEM 4.    Submission Of Matters To A Vote Of Security Holders

Not applicable.

ITEM 5.    Other Information

Not applicable.

ITEM 6.    Exhibits And Reports On Form 8-K

(a) Exhibits

10AAu	—	Amendment Number 6 to Transfer and Administration Agreement dated as of August 29, 2003
31-A	—	Certification of Chief Executive Officer Pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e), As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31-B	—	Certification of Chief Financial Officer Pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e), As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32-A	—	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-B	—	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
99-A	—	Cautionary Statements for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995

(b) Reports on Form 8-K

The Company furnished (not filed) a Current Report on Form 8-K on November 25, 2003 in connection with the issuance of its press release announcing financial results for the period ended October 31, 2003.

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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.

TECH DATA CORPORATION

(Registrant)

Signature	Title	Date
/s/    STEVEN A. RAYMUND Steven A. Raymund	Chairman of the Board of Directors; Chief Executive Officer	December 12, 2003
/s/    JEFFERY P. HOWELLS Jeffery P. Howells	Executive Vice President and Chief Financial Officer; Director (principal financial officer)	December 12, 2003
/s/    JOSEPH B. TREPANI Joseph B. Trepani	Senior Vice President and Corporate Controller (principal accounting officer)	December 12, 2003

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EX-10.AAU

Exhibit 10AAu

AMENDMENT NUMBER 6 TO

TRANSFER AND ADMINISTRATION AGREEMENT

AMENDMENT NUMBER 6 TO TRANSFER AND ADMINISTRATION AGREEMENT (this “Amendment”), dated as of August 29, 2003 among TECH DATA CORPORATION, a Florida corporation (“Tech Data”), as collection agent (in such capacity, the “Collection Agent”), TECH DATA FINANCE SPV, INC., a Delaware corporation headquartered in California, as transferor (in such capacity, the “Transferor”), YC SUSI TRUST, a Delaware statutory trust (“SUSI Issuer” (assignee of RECEIVABLES CAPITAL CORPORATION, a Delaware corporation (“RCC”)), LA FAYETTE ASSET SECURITIZATION LLC, a Delaware corporation (“La Fayette”) (assignee of ATLANTIC ASSET SECURITIZATION CORP., a Delaware corporation, (“Atlantic”)), LIBERTY STREET FUNDING CORP., a Delaware corporation, (“Liberty”), AMSTERDAM FUNDING CORPORATION, a Delaware corporation (“AFC”), FALCON ASSET SECURITIZATION CORPORATION, a Delaware corporation, (“Falcon” and collectively with RCC, Atlantic, Liberty, and AFC, the “Class Conduits”), CREDIT LYONNAIS NEW YORK BRANCH, a branch duly licensed under the laws of the State of New York of a banking corporation organized and existing under the laws of the Republic of France (“Credit Lyonnais”), as an Atlantic Bank Investor and as agent for Atlantic and the Atlantic Bank Investors (in such capacity, the “Atlantic Agent”), THE BANK OF NOVA SCOTIA, a banking corporation organized and existing under the laws of Canada, acting through its New York Agency (“Scotia Bank”), as a Liberty Bank Investor and as agent for Liberty and the Liberty Bank Investors (in such capacity, the “Liberty Agent”), ABN AMRO BANK N.V., a banking corporation organized and existing under the laws of the Netherlands and acting through its Chicago Branch (“ABN AMRO”), as an AFC Bank Investor and as agent for AFC and the AFC Bank Investors (in such capacity, the “AFC Agent”), BANK ONE, NA (having its main office in Chicago, Illinois), a national banking association (“Bank One”), as a Falcon Bank Investor and as agent for Falcon and the Falcon Bank Investors (in such capacity, the “Falcon Agent”) and BANK OF AMERICA, NATIONAL ASSOCIATION, a national banking association (“Bank of America”), as agent for RCC, Atlantic, Liberty, AFC, Falcon, the RCC Bank Investors, the Atlantic Bank Investors, the Liberty Bank Investors, the AFC Bank Investors and the Falcon Bank Investors (in such capacity, the “Administrative Agent”), as an RCC Bank Investor, as agent for RCC and the RCC Bank Investors (in such capacity, the “RCC Agent”) and Lead Arranger, amending that certain Transfer and Administration Agreement dated as of May 19, 2000, among the Transferor, the Collection Agent, the Class Conduits (as defined thereunder) and the Bank Investors (the “Original Agreement” and said agreement as amended, the “Agreement”).

WHEREAS, the Transferor desires to remove La Fayette as a Class Conduit, and Credit Lyonnais as a Bank Investor and La Fayette Agent from the Agreement;

WHEREAS, the Transferor desires the Facility Limits, Loss and Dilution Reserves and Maximum Net Investments in the Agreement to be adjusted;

WHEREAS, the Transferor desires to extend the Commitment Termination Date;

WHEREAS, RCC has entered into an Assignment and Assumption Agreement with SUSI Issuer;

WHEREAS, the Transferor desires to amend the financial covenants contained in the Original Agreement;

WHEREAS, on the terms and conditions set forth herein, the parties hereto consent to such amendments; and

WHEREAS, capitalized terms used herein shall have the meanings assigned to such terms in the Original Agreement;

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

SECTION 1. Amendment to Definitions.

(a) The definition of “Bank Investor” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Bank Investor” means (i) with respect to the Class of which RCC is a member, the RCC Bank Investors, (ii) with respect to the Class of which Liberty is a member, the Liberty Bank Investors, (iii) with respect to the Class of which AFC is a member, the AFC Bank Investors, (iv) with respect to the Class of which Falcon is a member, the Falcon Bank Investors, and (v) with respect to any other Class, the financial institutions specified as such in any supplement hereto and their respective successors and permitted assigns.”

(b) The definition of “Class” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Class” means each of the following groups of Class Investors: (i) RCC and the RCC Bank Investors, (ii) Liberty and the Liberty Bank Investors, (iii) AFC and the AFC Bank Investors, (iv) Falcon and the Falcon Bank Investors, or (v) any other Class consisting of a multi-seller commercial paper conduit, its related Bank Investors and its respective assigns and participants, as added from time to time with the consent of the Administrative Agent and the Transferor as set forth in Section 11.2(b).”

(c) The definition of “Class Agent” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Class Agent” means (i) with respect to the Class of which RCC is a member, the RCC Agent, (ii) with respect to the Class of which Liberty is a member, the

Liberty Agent, (iii) with respect to the Class of which AFC is a member, the AFC Agent, (iv) with respect to the Class of which Falcon is a member, the Falcon Agent, and (v) with respect to any other Class, the financial institution or other Person specified as such in any amendment or supplement hereto for such Class.”

(d) The definition of “Class Investors” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Class Investors” means (i) with respect to the Class of which RCC is a member, RCC and the RCC Bank Investors, (ii) with respect to the Class of which Liberty is a member, Liberty and the Liberty Bank Investors, (iii) with respect to the Class of which AFC is a member, AFC and the AFC Bank Investors, (iv) with respect to the Class of which Falcon is a member, Falcon and the Falcon Bank Investors, and (v) with respect to any other Class, the related Class Conduit and the related Bank Investors.”

(e) The definition of “Commercial Paper” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Commercial Paper” means the promissory notes issued by one or all, as applicable, of the Class Conduits (or by such Class Conduit’s related commercial paper issuer if the Class Conduit does not itself issue commercial paper) in the commercial paper market.”

(f) The definition of “Commitment Termination Date” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Commitment Termination Date” means, with respect to each Class, August 27, 2004, or such later date to which such Commitment Termination Date may be extended by Transferor, the related Class Agent and the related Bank Investors not later than 60 days prior to the then current Commitment Termination Date for such Class.”

(g) The definition of “Conduit Assignee” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Conduit Assignee” means, with respect to a Conduit Investor, any commercial paper conduit that finances its activities directly or indirectly through asset backed commercial paper and is administered by the Class Agent with respect to such Conduit Investor or any of its Affiliates and designated by such Class Agent from time to time to accept an assignment from such Conduit Investor of all or a portion of the Net Investment held by such Conduit Investor.”

(h) The definition of “Corporate Services Provider” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Corporate Services Provider” means, (i) with respect to RCC, Amacar Investments LLC, (ii) with respect to Liberty, Global Securitization Services, LLC and (iii) with respect to AFC, Global Securitization Services, LLC.”

(i) The definition of “CP Rate” is hereby deleted and replaced with the following:

““CP Rate” for each Class Conduit listed below, shall have the meaning specified in the Annex set forth below for such Class Conduit:

Class Conduit	Annex
RCC	Annex 1
Falcon	Annex 2
AFC	Annex 3
Liberty	Annex 4 ”

(j) The definition of “Credit Support Agreement” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Credit Support Agreement” means with respect to each Class Conduit, any agreement between such Class Conduit (or any related commercial paper issuer that finances the Class Conduit) and a Credit Support Provider evidencing the obligation of such Credit Support Provider to provide credit support to such Class Conduit (or such related issuer) in connection with the issuance by such Class Conduit (or such related issuer) of its Commercial Paper.”

(k) The definition of “Credit Support Provider” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Credit Support Provider” means, with respect to each Class, the Person or Persons who provides credit support to the related Class Conduit (or any related commercial paper issuer that finances the Class Conduit), in connection with the issuance by such Class Conduit (or such related issuer) of Commercial Paper.”

(l) The definition of “Facility Limit” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Facility Limit” means (i) with respect to the Class of which RCC is a member, $117,300,000; provided that such amount may not at any time exceed the aggregate Commitments with respect to the RCC Bank Investors, (ii) with respect to the Class of which Liberty is a member, $96,900,000; provided that such amount may not at any time exceed the aggregate Commitments with respect to the Liberty Bank Investors, in each case, at any time in effect, (iii) with respect to the Class of which AFC is a member, $96,900,000; provided that such amount may not at any time exceed the aggregate Commitments with respect to the AFC Bank Investors, in each case, at any time in effect, (iv) with respect to the Class of which Falcon is a member, $96,900,000; provided that such amount may not at any time exceed the aggregate Commitments with respect to the Falcon Bank Investors, in each case, at any time in effect, and (v) with respect to any other Class, the amount specified as such in any supplement hereto for such Class; provided that, with respect to any other Class, the Facility Limit for such Class shall not at any time exceed the aggregate Commitments for the Bank Investors in such Class.”

(m) The definition of “Interest Component” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Interest Component” shall mean, (A) with respect to any Class Conduit (or any related commercial paper issuer that finances the Class Conduit) not utilizing “pool” funding (i) with respect to any Commercial Paper issued on an interest-bearing basis, the interest payable on such Commercial Paper at its maturity (including any dealer commissions) and (ii) with respect to any Commercial Paper issued on a discount basis, the portion of the face amount of such Commercial Paper representing the discount incurred in respect thereof (including any dealer commissions) and (B) with respect to any Class Conduit (or any related commercial paper issuer that finances the Class Conduit) utilizing “pool funding,” the aggregate Discount accrued and to accrue through the end of the current Tranche Period for the portion of Net Investment accruing Discount calculated by reference to the CP Rate at such time (determined for such purpose using the CP Rate most recently determined by the applicable Class Agent, multiplied by the Fluctuation Factor).”

(n) The definition of “Liquidity Provider” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Liquidity Provider” means, with respect to each Class Conduit (or its related commercial paper issuer if the Class Conduit does not itself issue commercial paper), the Person or Persons who will provide liquidity support to such Class Conduit (or such related commercial paper issuer), in connection with the issuance by such Class Conduit (or such related commercial paper issuer) of its Commercial Paper.”

(o) The definition of “Liquidity Provider Agreement” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Liquidity Provider Agreement” means the agreement between each Class Conduit (or, if the Class Conduit does not itself issue commercial paper, either such Class Conduit or its related commercial paper issuer) and the related Liquidity Provider(s) evidencing the obligation of such Liquidity Provider(s) to provide liquidity support to such Class Conduit (or its related commercial paper issuer) in connection with the issuance by such Class Conduit (or such related commercial paper issuer) of its Commercial Paper.”

(p) The definition of “Loss and Dilution Reserve” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Loss and Dilution Reserve” means, with respect to each Class, at any time, an amount equal to the product of (i) the Loss and Dilution Reserve Percentage and (ii) the Net Investment for such Class at such time. Notwithstanding the foregoing, (i) with respect to the Class of which RCC is a member, the portion of the Loss and Dilution Reserve attributable to losses shall at all times be at least equal to $9,200,000, (ii) with respect to the Class of which Liberty is a member, the portion of the Loss and Dilution Reserve attributable to losses shall at all times be at least equal to $7,600,000, (iii) with respect to the Class of which AFC is a member, the portion of the Loss and Dilution Reserve attributable to losses shall at all times be at least equal to $7,600,000, (iv) with respect to the Class of which Falcon is a member, the portion of the Loss and Dilution Reserve attributable to losses shall at all times be at least equal to $7,600,000, and (v) with respect to any other Class, the portion of the Loss and Dilution Reserve shall at all times be at least equal to an amount agreed upon by the Transferor, the Administrative Agent and the Class Agent for such additional class at the time it becomes a party hereto.”

(q) The definition of “Maximum Net Investment” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Maximum Net Investment” means (i) with respect to the Class of which RCC is a member, $115,000,000, (ii) with respect to the Class of which Liberty is a member, $95,000,000, (iii) with respect to the Class of which AFC is a member, $95,000,000, (iv) with respect to the Class of which Falcon is a member, $95,000,000, and (v) with respect to any other Class, the amount set forth pursuant to Section 11.2(b).”

(r) The definition of “Pro Rata Share” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Pro Rata Share” means, (A) for an RCC Bank Investor, the Commitment of such RCC Bank Investor divided by the sum of the Commitments of all the RCC Bank Investors, (B) for a Liberty Bank Investor, the Commitment of such Liberty Bank Investor divided by the sum of the Commitments of all Liberty Bank Investors, (C) for an AFC Bank Investor, the Commitment of such AFC Bank Investor divided by the sum of the Commitments of all AFC Bank Investors, (D) for a Falcon Bank Investor, the Commitment of such Falcon Bank Investor divided by the sum of the Commitments of all Falcon Bank Investors, and (E) with respect to any other Class, for each Bank Investor of such Class, the Commitment of such Bank Investor divided by the sum of the Commitments of all Bank Investors of such Class.”

(s) The definition of “Related Commercial Paper” is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““Related Commercial Paper” shall mean, with respect to Commercial Paper issued by the Class Conduits (or their related commercial paper issuer(s) if the Class Conduits do not themselves issue commercial paper) the proceeds of which were used to acquire, or refinance the acquisition of, an interest in Receivables with respect to the Transferor.”

(t) The following definitions shall be deleted from Section 1.1 in the appropriate alphabetical order:

(1) “Atlantic” means Atlantic Asset Securitization Corp., and its successors and assigns.

(2) “Atlantic Agent” means Credit Lyonnais, in its capacity as agent for Atlantic and the Atlantic Bank Investors, and any successor thereto appointed pursuant to Article IX.

(3) “Atlantic Bank Investors” means Credit Lyonnais and BNP, their respective successors and assigns who are or become parties to this Agreement as such pursuant to an Assignment and Assumption Agreement.

(4) “Credit Lyonnais” means Credit Lyonnais New York Branch, a branch duly licensed under the laws of the State of New York of a banking corporation organized and existing under the laws of France, and its successors and assigns.

SECTION 2. Amendment to Section 2.2(a). Section 2.2(a) is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“(a) Incremental Transfers. With respect to each Class, upon the terms and subject to the conditions herein set forth and provided that a Termination Event or a Potential Termination Event or the Termination Date for such Class shall not have

occurred and be continuing, the Transferor may, at its option, convey, transfer and assign to the Administrative Agent on behalf of the applicable Class Investors for such Class and the Administrative Agent, on behalf of the Class Conduit for such Class may, at the option of such Class Conduit, or the Administrative Agent on behalf of the Bank Investors for such Class provided that such Bank Investors shall have previously accepted the assignment by the related Class Conduit of all of such Class Conduit’s interest in the Affected Assets, shall, if so requested by the Transferor, accept such conveyance, transfer and assignment from the Transferor, without recourse except as provided herein, undivided percentage ownership interests in the Receivables, together with Related Security, Collections and Proceeds with respect thereto (each, an “Incremental Transfer”); provided that after giving effect to the payment to the Transferor of the Transfer Price therefor (i) the Net Investment for such Class shall not exceed the Maximum Net Investment for such Class, (ii) the sum of the Net Investment for such Class plus, in the case where the Class Conduit for such Class holds a portion of the Transferred Interest, the Interest Component of all outstanding Related Commercial Paper issued by such Class Conduit (or its related commercial paper issuer if the Class Conduit does not itself issue commercial paper) shall not exceed the Facility Limit for such Class and (iii) the Aggregate Percentage Factor shall not exceed the Maximum Percentage Factor; and, provided, that the representations and warranties set forth in Section 3.1 shall be true and correct both immediately before and immediately after giving effect to any such Transfer. All Incremental Transfers shall be made on a pro rata basis to each Class (based upon the relation of the Maximum Net Investment for such Class to the Aggregate Maximum Net Investment).

The Transferor shall, by notice to the Administrative Agent given by telecopy, offer to convey, transfer and assign to the Administrative Agent, on behalf of any of the applicable Class Investors, undivided percentage ownership interests in the Receivables and the other Affected Assets relating thereto at least two (2) Business Days prior to the proposed date of any Incremental Transfer. With respect to each Class, each such notice shall specify (w) whether such request is made to the Administrative Agent on behalf of the Class Conduit for such Class or the related Bank Investors for such Class (it being understood and agreed that once any of such Bank Investors acquire any interest in the Transferred Interest hereunder, such Bank Investors shall be required to purchase all of the portion of the Transferred Interest held by the related Class Conduit in accordance with Section 10.7 and thereafter such Class Conduit shall no longer accept any additional Incremental Transfers hereunder), (x) the desired Transfer Price (which shall be at least $5,000,000 per Class or integral multiples of $1,000,000 in excess thereof) or, to the extent that the then available unused portion of the Aggregate Maximum Net Investment is less than such amount, such lesser amount equal to such available portion of such Aggregate Maximum Net Investment), (y) the desired date of such Incremental Transfer and (z) the desired Tranche Period(s) and allocations of the Net Investment for such Class of such Incremental Transfer thereto as required by Section 2.3. The Administrative Agent will promptly notify each Class Agent and each Class Conduit or related Bank Investors for such Class, as applicable, of the Administrative Agent’s receipt of any request for an Incremental Transfer to be made to such Person. To the extent that any such Incremental Transfer is requested of a Class

Conduit, such Class Conduit shall accept or reject such offer by notice given to the Transferor and the Administrative Agent by telephone or telecopy by no later than the close of its business on the Business Day following its receipt of any such request. Each notice of proposed Transfer shall be irrevocable and binding on the Transferor and the Transferor shall indemnify each Class Investor against any loss or expense incurred by such Class Investor, either directly or through a Liquidity Provider Agreement, as a result of any failure by the Transferor to complete such Incremental Transfer including, without limitation, any loss (including loss of anticipated profits) or expense incurred by such Class Investor, either directly or pursuant to a Liquidity Provider Agreement by reason of the liquidation or reemployment of funds acquired by such Class Investor (or a related Liquidity Provider) (including, without limitation, funds obtained by issuing commercial paper or promissory notes or obtaining deposits as loans from third parties) to fund such Incremental Transfer.

On the date of the initial Incremental Transfer to the Class Investors, the related Class Agent on behalf of such Class shall deliver written confirmation to the Transferor of the Transfer Price, the Tranche Period(s) and the Tranche Rate(s) relating to such Transfer and the Transferor shall deliver to the Administrative Agent the Transfer Certificate in the form of Exhibit F hereto (the “Transfer Certificate”). The Administrative Agent shall indicate the amount of the initial Incremental Transfer together with the date thereof on the grid attached to the Transfer Certificate. On the date of each subsequent Incremental Transfer, the applicable Class Agent shall send written confirmation to the Transferor of the Transfer Price, the Tranche Period(s), the Transfer Date and the Tranche Rate(s) applicable to such Incremental Transfer. The Administrative Agent shall indicate the amount of the Incremental Transfer together with the date thereof as well as any decrease in each Net Investment, on the grid attached to the Transfer Certificate. The Transfer Certificate shall evidence the Incremental Transfers.

By no later than 11:00 a.m. (New York time) on any Transfer Date, each Class Investor participating in the Incremental Transfer occurring on such date shall remit its share (which, in the case of an Incremental Transfer to the Bank Investors for any Class shall be equal to each such Bank Investor’s Pro Rata Share) of the aggregate Transfer Price for such Transfer to the account of the Administrative Agent specified therefor from time to time by the Administrative Agent by notice to such Persons. The obligation of each Bank Investor of any Class to remit its Pro Rata Share of any such Transfer Price shall be several from that of each other Bank Investor of such Class and the failure of any such Bank Investor to so make such amount available to the Administrative Agent shall not relieve any other Bank Investor of such Class of its respective obligation hereunder. Following each Incremental Transfer and the Administrative Agent’s receipt of funds from the applicable Class Investors, as aforesaid, the Administrative Agent shall remit to the Transferor’s account at the location indicated in Section 11.3 hereof, in immediately available funds, an amount equal to the Transfer Price for such Incremental Transfer. Unless the Administrative Agent shall have received notice from a Class Investor that such Person will not make its share of any Transfer Price relating to any Incremental Transfer available on the applicable Transfer

Date therefor, the Administrative Agent may (but shall have no obligation to) make such Person’s share of any such Transfer Price available to the Transferor in anticipation of the receipt by the Administrative Agent of such amount from such Person. To the extent any Class Investor fails to remit any such amount to the Administrative Agent after any such advance by the Administrative Agent on such Transfer Date, such Class Investor, on the one hand, and the Transferor on the other hand, shall be required to pay such amount, together with interest thereon at a per annum rate equal to the Federal funds rate (as determined in accordance with clause (ii) of the definition of “Base Rate”), in the case of such Class Investor, or the Base Rate, in the case of the Transferor, to the Administrative Agent upon its demand therefor (provided that no Class Conduit shall have any obligation to pay such interest amounts except to the extent that it shall have sufficient funds to pay the face amount of its Commercial Paper (or the commercial paper of its related issuer if the Class Conduit does not itself issue commercial paper) in full). Until such amount shall be repaid, such amount shall be deemed to be Aggregate Net Investment paid by the Administrative Agent and the Administrative Agent shall be deemed to be the owner of a Transferred Interest hereunder. Upon the payment of such amount to the Administrative Agent (x) by the Transferor, the amount of the Aggregate Net Investment shall be reduced by such amount or (y) by such Class Investor, such payment shall constitute such Class Investor’s payment of its share of the applicable Transfer Price for such Transfer.”

SECTION 3. Amendment to Section 2.4. Section 2.4 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“Discount, Fees and Other Costs and Expenses. The Transferor shall pay, as and when due in accordance with this Agreement, all fees hereunder, all amounts payable pursuant to Article VIII hereof, if any, and the Servicing Fees. With respect to each Class, on the last day of each Tranche Period or, for any Conduit (or its related commercial paper issuer if the Conduit does not itself issue commercial paper) that utilizes “pool funding” on or prior to the fifth Business Day of the calendar month following the applicable Tranche Period, the Transferor shall pay to the Administrative Agent on behalf of the related Class Conduit (or its related commercial paper issuer), and the Administrative Agent shall pay such payment to such Class Conduit (or its related commercial paper issuer), in the event any portion of the Transferred Interest is held by such Class Conduit (or its related commercial paper issuer), an amount equal to the Discount accrued on such Class Conduit’s (or its related commercial paper issuer’s) Commercial Paper to the extent such Commercial Paper was issued in order to fund such portion of the Transferred Interest in an amount in excess of the Transfer Price of an Incremental Transfer, which excess amount shall not exceed $5,000. The Transferor shall pay to the Administrative Agent on behalf of the applicable Class Conduit (or its related commercial paper issuer) each day on which Commercial Paper is issued by such Class Conduit (or its related commercial paper issuer), the applicable Dealer Fee, and the Administrative Agent shall pay such Dealer Fee to such Class Conduit; provided, however , that at the election of a Class Conduit, Dealer Fees accrued over the course of any calendar month in respect of Related Commercial Paper may be payable by the Transferor on the last day of one or more Tranche Periods ending during the succeeding

calendar month. The applicable Discount shall accrue with respect to each respective Tranche on each day occurring during the Tranche Period related thereto. Nothing in this Agreement shall limit in any way the obligations of the Transferor to pay the amounts set forth in this Section 2.4.”

SECTION 4. Amendment to Section 5.2(g). Section 5.2(g) of the Original Agreement hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“(g) Change of Name, Etc. The Transferor will not change its name, identity or structure or the location of its chief executive office, or its jurisdiction of organization unless at least 10 days prior to the effective date of any such change the Transferor delivers to the Administrative Agent (i) such documents, instruments or agreements, executed by the Transferor, necessary to reflect such change and to continue the perfection of the Administrative Agent’s ownership interests or security interests in the Affected Assets and (ii) new or revised Lock-Box Agreements executed by the Lock-Box Banks which reflect such change and enable the Administrative Agent to continue to exercise its rights contained in Section 2.8 hereof.”

SECTION 5. Amendment to Section 5.4(g). Section 5.4(g) of the Original Agreement is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“(g) Change of Name, Etc. Tech Data will not change its name, identity or structure or location of its chief executive office, or its jurisdiction of organization unless at least 10 days prior to the effective date of any such change Tech Data delivers to the Transferor and the Administrative Agent (i) such documents, instruments or agreements, executed by the Transferor, as are necessary to reflect such change and to continue the perfection of the Transferor’s ownership interest in the Receivables and (ii) new or revised Lock-Box Agreements executed by the Lock-Box Banks which reflect such change and enable the Administrative Agent on behalf of the Class Investors to continue to exercise its rights contained in Section 2.8 hereof.”

SECTION 6. Amendment to Section 5.5. Section 5.5 of the Original Agreement is hereby deleted and replaced with the following:

“Section 5.5 Financial Covenants of the Collection Agent.

(a) Consolidated Tangible Net Worth. The Collection Agent shall not permit the Consolidated Tangible Net Worth at any time to be less than the sum of (i) $980,000,000, (ii) an amount equal to 75% of the Consolidated Net Income earned in each full fiscal quarter ending after January 31, 2003 (with no deduction for a net loss in any such fiscal quarter) and (iii) an amount equal to 100% of the aggregate increases in Shareholders’ Equity of the Collection Agent and its Subsidiaries after May

2, 2003 by reason of the issuance and sale of capital stock or other equity interest of the Collection Agent or any Subsidiary (other than issuances to the Collection Agent or a wholly-owned Subsidiary), including upon any conversion of debt securities of the Collection Agent into capital stock or other equity interests.

(b) Consolidated Total Leverage Ratio. The Collection Agent shall not permit the Consolidated Total Leverage Ratio at any time during any period of the Collection Agent set forth below to be greater than the ratio set forth below opposite such period:

Period	Maximum Consolidated Total Leverage Ratio
The date hereof through January 31, 2004	4.00 to 1.00
February 1, 2004 and Thereafter	3.75 to 1.00

(c) Consolidated Senior Leverage Ratio. The Collection Agent shall not permit the Consolidated Senior Leverage Ratio at any time to be greater than 3.25 to 1.00.

(d) Consolidated Interest Coverage Ratio. The Collection Agent shall not permit the Consolidated Interest Coverage Ratio as of the end of any period of four fiscal quarters of the Collection Agent to be less than 3.50 to 1.00.

(e) Definitions. Capitalized terms used in this Section 5.5 and not defined herein shall have those meanings assigned to such terms in the Amended and Restated Credit Agreement dated as of May 2, 2003 among Tech Data Corporation, each lender from time to time party thereto, and Bank of America, N.A. (the “Credit Agreement”). The Collection Agent agrees that it shall give 10 Business Days prior written notice to the Administrative Agent of any amendment or modification of any term or definition set out in the Credit Agreement which affects the calculation of any financial covenant or financial ratio set out in this Section 5.5. No such amendment or modification to the Credit Agreement shall be effective for the purposes of this Section 5.5 unless the Administrative Agent shall have obtained the consent thereto of each Class Conduit (so long as such Class Conduit holds any portion of the Transferred Interest), each Class Agent and the Majority Investors.

(f) Interpretation. The following rules of interpretation shall apply to the extent Collection Agent or any Subsidiary consummates any acquisition during the term of this Agreement that is accounted for as a “purchase”:

i. As of the last day of each of the four fiscal quarters of Collection Agent next following the date of such acquisition (including the fiscal quarter that includes the date of such acquisition), Consolidated EBITDA shall include the actual results of operations of the Person or assets so acquired, which amounts shall be determined on a historical pro forma basis and which amounts may include such adjustments as are permitted under Regulation S-X of the Securities and Exchange Commission and reasonably satisfactory to Administrative Agent; provided that in making the adjustments provided for in this paragraph (a), Consolidated Interest Charges shall be adjusted as provided in paragraph (b) below; and

ii. As of the last day of each of the four fiscal quarters of Collection Agent next following the date of such acquisition (including the fiscal quarter that includes the date of such acquisition), Consolidated Interest Charges shall include the results of operations of the Person or assets so acquired, which amounts shall be determined on a historical pro forma basis; provided, however, in the case of the occurrence of an acquisition, there shall be added to Consolidated Interest Charges for the first four consecutive fiscal quarters ending after the date of such acquisition an amount which shall be determined by multiplying that portion of the Cost of Acquisition that represents Indebtedness (net of Indebtedness repaid in connection with such acquisitions) incurred to fund such Cost of Acquisition, whether incurred, assumed or acquired, times the interest rate applicable to such Indebtedness (adjusted for any discount) which is in effect on the date of determination and then multiplying the result by a fraction the numerator of which is 365 minus the actual number of days that have elapsed from and after the date of such acquisition and the denominator of which is 365.

iii. For the purpose of determining the amount of any increase in the minimum Consolidated Tangible Net Worth requirement of Section 5.5, any increase in Consolidated Tangible Net Worth from treatment of an acquisition on a historical pro forma basis pursuant to paragraph (a) above shall be disregarded.”

SECTION 7. Amendment to Section 7.1(k). Section 7.1(k) is hereby deleted

and replaced with the following (solely for convenience changed language is italicized):

“(k) any Liquidity Provider or any Credit Support Provider shall have given notice that an event of default has occurred and is continuing under any of its respective agreements with the applicable Class Conduit(s) (or their related commercial paper issuer(s)); or”

SECTION 8. Amendment to Section 7.1(l). Section 7.1(l) is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“(l) the Commercial Paper issued by any of the Class Conduits (or their related commercial paper issuer if the Class Conduit does not itself issue commercial paper) shall not be rated at least “A-2” by Standard & Poor’s, at least “P-2” by Moody’s and at least “D-1” by DCR, unless such downgrading is the result of the Credit Support Provider being downgraded; or”

SECTION 9. Amendment to Section 7.1(n). Section 7.1(n) is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“(n) the Aggregate Percentage Factor equals or exceeds 100% for a period of one full Business Day (provided that in such case the Termination Event caused thereby shall be deemed to have occurred at the start of such one full Business Day period) or the Aggregate Percentage Factor as reported on any Investor Report shall equal or exceed 100% or for any Class, the sum of the Net Investment for such Class plus, in the case where the related Class Conduit holds a portion of the Transferred Interest, the Interest Component of all outstanding Related Commercial Paper issued by such Class Conduit (or its related commercial paper issuer if the Class Conduit does not itself issue commercial paper) exceeds the Facility Limit for such Class; or”

SECTION 10. Amendment to Section 8.1. Section 8.1 of the Original Agreement is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“Indemnities by the Transferor. Without limiting any other rights which the Administrative Agent or any of the Class Investors may have hereunder or under applicable law, the Transferor hereby agrees to indemnify each Class Agent, each Class Investor, the Administrative Agent, the Collateral Agent, any Liquidity Provider, any Credit Support Provider and any related commercial paper issuer that finances a Class Conduit and any successors and any permitted assigns and their respective officers, directors and employees (collectively, “Indemnified Parties”) from and against any and all damages, losses, claims, liabilities, costs and expenses, including, without limitation, reasonable attorneys’ fees (which such attorneys may be employees of any Liquidity Provider, any Credit Support Provider, any Class Agent, the Administrative Agent or the Collateral Agent, as applicable) and disbursements (all of the foregoing being collectively referred to as “Indemnified Amounts”) awarded against or incurred by any of them arising out of or as a result of this Agreement or the ownership, either directly or

indirectly, by the Administrative Agent or any Class Investor of the Transferred Interest excluding, however, (i) Indemnified Amounts to the extent resulting from gross negligence or willful misconduct on the part of such Indemnified Party or (ii) recourse (except as otherwise specifically provided in this Agreement) for uncollectible Receivables or (iii) claims arising from credit losses. Without limiting the generality of the foregoing, the Transferor shall indemnify each Indemnified Party for Indemnified Amounts relating to or resulting from:

(i) reliance on any representation or warranty made by the Transferor (or any officers of the Transferor) under or in connection with this Agreement, any Investor Report or any other information or report delivered by the Transferor pursuant hereto, which shall have been false or incorrect in any material respect when made or deemed made;

(ii) the failure by the Transferor to comply with any applicable law, rule or regulation with respect to any Receivable or the related Contract, or the nonconformity of any Receivable or the related Contract with any such applicable law, rule or regulation;

(iii) the failure to vest and maintain vested in the Administrative Agent on behalf of the Class Investors an undivided percentage ownership or security interest, to the extent of the Transferred Interest, in the Receivables included in the Transferred Interest, free and clear of any Adverse Claim;

(iv) the failure to file, or any delay in filing, financing statements, continuation statements, or other similar instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with respect to any of the Affected Assets;

(v) any dispute, claim, offset or defense (other than discharge in bankruptcy) of the Obligor to the payment of any Receivable included in the Transferred Interest (including, without limitation, a defense based on such Receivable or the related Contract not being legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale of merchandise or services related to such Receivable or the furnishing or failure to furnish such merchandise or services;

(vi) any failure of Tech Data, as Collection Agent or otherwise, to perform its duties or obligations in accordance with the provisions of Article VI; or

(vii) any products liability claim or personal injury or property damage suit or other similar or related claim or action of whatever sort arising out of or in connection with merchandise or services which are the subject of any Receivable;”

provided, however, that if any Class Conduit enters into agreements for the purchase of interests in receivables from one or more Other Transferors, such Class Conduit shall allocate such Indemnified Amounts which are in connection with a Liquidity Provider Agreement, a Credit Support Agreement or the credit support furnished by a Credit Support Provider to the Transferor and each Other Transferor.

SECTION 11. Amendment to Section 11.3. Section 11.3 of the Original Agreement is hereby amended as follows:

(a) The following text is hereby deleted:

“ If to Atlantic:

Atlantic Asset Securitization Corp.

c/o Credit Lyonnais New York Branch

1301 Avenue of the Americas

New York, New York 10019

Attention: David Fink

Telephone: (212) 261-7816

Telecopy: (212) 459-3258

with a copy to:

Credit Lyonnais New York Branch

1301 Avenue of the Americas

New York, New York 10019

Attention: David Fink

Telephone: (212) 261-7816

Telecopy: (212) 459-3258

(b) The following text is hereby deleted:

“If to RCC:

Receivables Capital Corporation

c/o Merrill Lynch Money Markets, Inc.

World Financial Center – North Tower

250 Vesey Street – 11^th Floor

New York, New York 10281-1311

Attn: Stewart Cutler – Managing Director

Telephone: (212) 449-7468

Telecopy: (212) 449-8939

(with a copy to the Administrative Agent)”

(c) The following text is hereby inserted:

“If to YC SUSI Trust:

YC SUSI Trust

[c/o Global Securitization Services, Inc.

Attn:

Telephone:

Telecopy:]

(with a copy to the Administrative Agent)”

SECTION 12. Amendment to Section 11.7. Section 11.7 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“Waiver of Confidentiality. The Transferor and Tech Data hereby consent to the disclosure of any non-public information with respect to it received by the Administrative Agent, any Class Investor or any Class Agent to any of the Administrative Agent, any Class Agent, any Class Investor, any nationally recognized rating agency rating any Class Conduit’s Commercial Paper, the Administrative Agent, the Collateral Agent, any Bank Investor or potential Bank Investor, any related commercial paper issuer that finances a Class Conduit, any related Liquidity Provider or any related Credit Support Provider in relation to this Agreement.”

SECTION 13. Amendment to Section 11.8. Section 11.8 is hereby amended by adding the following at the end thereof:

“Anything herein to the contrary notwithstanding, the Transferor, the Collection Agent, Tech Data, each Class Investor, each Class Agent, the Administrative Agent, each Indemnified Party and any successor or assign of any of the foregoing (and each employee, representative or other agent of any of the foregoing) may disclose to any and all Persons,

without limitation of any kind, the “tax treatment” and “tax structure” (in each case, within the meaning of Treasury Regulation Section 1.6011-4) of the transactions contemplated herein and all materials of any kind (including opinions or other tax analyses) that are or have been provided to any of the foregoing relating to such tax treatment or tax structure, and it is hereby confirmed that each of the foregoing have been so authorized since the commencement of discussions regarding the transactions.”

SECTION 14. Amendment to Section 11.9. Section 11.9 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“No Bankruptcy Petition Against any Class Conduit. Each party hereto hereby covenants and agrees that, prior to the date which is one year and one day after the payment in full of all outstanding Commercial Paper or other indebtedness of any Class Conduit (or any related commercial paper issuer that finances the Class Conduit), it will not institute against, or join any other Person in instituting against, such Class Conduit (or such related issuer) any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceeding under the laws of the United States or any state of the United States.”

SECTION 15. Amendment to Section 11.10. Section 11.10 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“No Recourse Against Stockholders, Officers or Directors. Notwithstanding anything to the contrary contained in this Agreement, the obligations of each Class Conduit (or any related commercial paper issuer that finances the Class Conduit) under this Agreement and all other Transaction Documents are solely the corporate obligations of such Class Conduit (or such related issuer) and shall be payable solely to the extent of funds received from the Transferor in accordance herewith or from any party to any Transaction Document in accordance with the terms thereof in excess of funds necessary to pay matured and maturing Commercial Paper of the applicable Class Conduit (or its related issuer). No recourse under any obligation, covenant or agreement of any Class Conduit (or its related issuer) contained in this Agreement shall be had against such Class Conduit’s (or such related issuer’s) Corporate Services Provider (or any Affiliate thereof), or any stockholder, employee, officer, director or incorporator of any Class

Conduit (or its related issuer) or beneficial owner of any of them, as such, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute or otherwise; it being expressly agreed and understood that this Agreement is solely a corporate obligation of each Class Conduit (or its related issuer), and that no personal liability whatsoever shall attach to or be incurred by the Corporate Services Provider (or any Affiliate thereof), or the stockholder, employee, officer, director or incorporator of any Class Conduit (or its related issuer) or beneficial owner of any of them, as such, or any of them, under or by reason of any of the obligations, covenants or agreements of any Class Conduit (or its related issuer) contained in this Agreement, or implied therefrom, and that any and all personal liability for breaches by any Class Conduit (or its related issuer) of any of such obligations, covenants or agreements, either at common law or at equity, or by statute or constitution, of the Corporate Services Provider (or any Affiliate thereof) and every such stockholder, employee, officer, director or incorporator of a Class Conduit (or its related issuer) or beneficial owner of any of them is hereby expressly waived as a condition of and consideration for the execution of this Agreement; provided, however, that a Class Conduit (or its related issuer) shall be considered to be an Affiliate of the Corporate Services Provider; and provided, further, that this Section 11.2 shall not relieve any such stockholder, employee, officer, director or incorporator of any Class Conduit (or its related issuer) or beneficial owner of any of them of any liability it might otherwise have for its own intentional misrepresentation or willful misconduct.”

SECTION 16. Amendment to Section 11.12. Section 11.12 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

“Optional Reconveyance of All Receivables. The Transferor shall have the option at any time to require the Administrative Agent, on behalf of the Class Investors, as applicable, to reconvey all of its interest in the Receivables to the Transferor subject to the following terms and conditions: (a) the Transferor shall give the Administrative Agent and each Class Agent not less than 10 Business Days notice of the Transferor’s exercise of this option and (b) simultaneously with the reconveyance by the Administrative Agent to the Transferor of the Administrative Agent’s interest in the Receivables, the Transferor shall pay to the Administrative Agent, for the benefit of the applicable Class Investors, an amount equal to the Aggregate Net Investment plus all discount accrued and to accrue on the Class Conduit’s (or, if a related commercial paper issuer finances the Class

Conduit, the related issuer’s,) Related Commercial Paper to maturity, together with any other costs associated with the receipt by each Class Conduit (or its related issuer) of its Net Investment on a day other than the last day of an applicable Tranche Period along with any other amounts owing hereunder to the Class Investors by the Transferor.”

SECTION 17. Amendment to Annex 1 . Annex 1 is hereby deleted and replaced with the following (solely for convenience changed language is italicized):

““CP Rate” shall mean for any CP Tranche Period, the per annum rate equivalent to the “weighted average cost” (as defined below) related to the issuance of Commercial Paper that is allocated, in whole or in part, to fund the SUSI Issuer’s Net Investment (and which may also be allocated in part to the funding of other assets of the SUSI Issuer); provided, however, that if any component of such rate described above is a discount rate in calculating the CP Rate for the SUSI Issuer’s Net Investment for such CP Tranche Period, the rate used to calculate such component of such rate shall be a rate resulting from converting such discount rate to an interest bearing equivalent rate per annum. As used in this definition, the “weighted average cost” shall consist of (A) the actual interest rate (or discount) paid to purchasers of Commercial Paper issued by the SUSI Issuer or any related commercial paper issuer that finances the SUSI Issuer (other than the commissions of placement agents and dealers), (B) certain documentation and transaction costs associated with the issuance of such Commercial Paper, (C) any incremental carrying costs incurred with respect to Commercial Paper maturing on dates other than those on which corresponding funds are received by the related Class Agent on behalf of the SUSI Issuer (or its related commercial paper issuer), and (D) other borrowing by the SUSI Issuer (or its related commercial paper issuer) (other than under any program support agreement), including to fund small or odd dollar amounts that are not easily accommodated in the commercial paper market.”

SECTION 18. Amendment to Annex 4. Annex 4 is hereby deleted in its entirety.

SECTION 19. Amendment to Annex 5. Annex 5 is hereby renamed as Annex 4.

SECTION 20. Amendment to Exhibit N. Exhibit N is hereby deleted.

SECTION 21. As of the date hereof, Credit Lyonnais and Atlantic have no further obligations under the Agreement. In addition, Lloyds TSB Bank plc shall no longer be a party to the Agreement and shall have no further obligations thereunder as either an RCC Bank Investor or an Atlantic Bank Investor. Notwithstanding the terms of this Amendment, the parties’ obligations under Section 8.1, Section 11.9 and Section 11.10 shall continue and shall survive this Amendment.

SECTION 22. RCC Assignment. All parties hereto agree and acknowledge that RCC has assigned all of its rights and interests in the Agreement to SUSI Issuer and therefore all references in the Agreement to RCC shall be deemed to refer to SUSI Issuer.

SECTION 23. Affirmations. All parties hereto agree and acknowledge that with respect to each Bank Investor party hereto, each Bank Investor has a Commitment and such Commitment of such Bank Investor shall be the dollar amount set forth opposite such Bank Investor’s signature on the signature page hereto, which may be different from the Original Agreement.

SECTION 24. Conditions Precedent. This Amendment shall not become effective until the Administrative Agent shall have received the following:

(b) A copy of the Resolutions of the Board of Directors of the Transferor and Tech Data certified by its Secretary approving this Amendment and the other documents to be delivered by the Transferor and Tech Data hereunder;

(b) A Certificate of the Secretary of the Transferor and Tech Data certifying (i) the names and signatures of the officers authorized on its behalf to execute this Amendment and any other documents to be delivered by it hereunder (on which Certificates the Class Conduits, the Class Agents, the Administrative Agent and the Bank Investors may conclusively rely until such time as the Administrative Agent shall receive from the Transferor and Tech Data a revised Certificate meeting the requirements of this clause (b)(i)) and (ii) a copy of the Transferor’s and Tech Data’s By-Laws;

SECTION 25. Representations and Warranties. The Transferor hereby makes to the Class Investors, the Class Agents and the Administrative Agent, on and as of the date hereof, all of the representations and warranties set forth in Section 3.1 of the Original Agreement. In addition, the Collection Agent and the Guarantor hereby make to the Class Investors, the Class Agents and the Administrative Agent, on the date hereof, all the representations and warranties set forth in Section 3.3 of the Original Agreement.

SECTION 26. Successors and Assigns. This Amendment shall bind, and the benefits hereof shall inure to the parties hereof and their respective successors and permitted assigns;

SECTION 27. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THE TRANSFEROR HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE CITY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

SECTION 28. Severability; Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same instrument. Any provisions of this Amendment which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

SECTION 29. Captions. The captions in this Amendment are for convenience of reference only and shall not define or limit any of the terms or provisions hereof.

SECTION 30. Ratification. Except as expressly affected by the provisions hereof, the Original Agreement as amended by this Amendment shall remain in full force and effect in accordance with its terms and ratified and confirmed by the parties hereto. On and after the date hereof, each reference in the Original Agreement to “this Agreement”, “hereunder”, “herein” or words of like import shall mean and be a reference to the Original Agreement as amended by this Amendment.

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

TECH DATA FINANCE SPV, INC., as Transferor
By:	/s/ Charles V. Dannewitz
	Name: Charles V. Dannewitz
	Title: Sr. Vice President of Tax and Treasurer
TECH DATA CORPORATION, as Collection Agent
By:	/s/ Charles V. Dannewitz
	Name: Charles V. Dannewitz
	Title: Sr. Vice President of Tax and Treasurer

YC SUSI TRUST
By:	/s/ Jeffrey Fricano
	Name: Jeffrey Fricano
	Title: Vice President
LA FAYETTE ASSET SECURITIZATION LLC
By:	CREDIT LYONNAIS NEW YORK BRANCH,
	as attorney-in-fact
By:	/s/ Joan Flanigan-Clarke
	Name: Joan Flanigan-Clarke
	Title: Vice President
LIBERTY STREET FUNDING CORP.
By:	/s/ Andrew L. Stidd
	Name: Andrew L. Stidd
	Title: President
AMSTERDAM FUNDING CORPORATION
By:	/s/ Andrew L. Stidd
	Name: Andrew L. Stidd
	Title: President
FALCON ASSET SECURITIZATION CORPO- RATION
By:	/s/ Maureen E. Marcon
	Name: Maureen E. Marcon
	Title: Authorized Signer

Commitment	BANK OF AMERICA, NATIONAL
$117,300,000	ASSOCIATION, as Administrative Agent, RCC Agent and as an RCC Bank Investor
	By:	/s/ Jeffrey Fricano
		Name: Jeffrey Fricano
		Title: Vice President

Commitment $0	CREDIT LYONNAIS NEW YORK BRANCH, as Atlantic Agent and as an Atlantic Bank Investor
	By:	/s/ Joan Flanigan-Clarke
		Name: Joan Flanigan-Clarke
		Title: Vice President

Commitment $96,900,000	THE BANK OF NOVA SCOTIA, as Liberty Agent and as a Liberty Bank Investor
	By:	/s/ Norman Last
		Name: Norman Last
		Title: Managing Director

Commitment	ABN AMRO BANK N.V., as AFC Agent
$96,900,000	and as an AFC Bank Investor
	By:	/s/ Bernard Koh
		Name: Bernard Koh
		Title: Senior Vice President
	By:	/s/ Kevin G. Pilz
		Name: Kevin G. Pilz
		Title: Vice President

Commitment $96,900,000	BANK ONE, NA (having its main office in Chicago Illinois), as Falcon Agent and as a Falcon Bank Investor
	By:	/s/ Maureen E. Marcon
		Name: Maureen E. Marcon
		Title: Director, Banc One Capital Markets, Inc.

Commitment $0	LLOYDS TSB BANK PLC, as an Atlantic Bank Investor and an RCC Bank Investor
	By:	/s/ Michelle White
		Name: Michelle White
		Title: Assistant Vice President,           Structured Finance, W 154
	By:	/s/ Ian Dimmock
		Name: Ian Dimmock
		Title: Vice President,           Structured Finance, D080

EX-31.A

CERTIFICATIONS

Exhibit 31-A

Certification of Chief Executive Officer

Pursuant to

Exchange Act Rules 13a-15(e) and 15d-15(e),

As Adopted Pursuant to

Section 302 of The Sarbanes-Oxley Act of 2002

I, Steven A. Raymund, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Tech Data Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 12, 2003

/s/    STEVEN A. RAYMUND        

Steven A. Raymund

Chairman of the Board of Directors and

Chief Executive Officer

EX-31.B

Exhibit 31-B

Certification of Chief Financial Officer

Pursuant to

Exchange Act Rules 13a-15(e) and 15d-15(e),

As Adopted Pursuant to

Section 302 of The Sarbanes-Oxley Act of 2002

I, Jeffery P. Howells, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Tech Data Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 12, 2003

/s/    JEFFERY P. HOWELLS        

Jeffery P. Howells

Executive Vice President and

Chief Financial Officer

EX-32.A

Exhibit 32-A

Certification of Chief Executive Officer

Pursuant to

U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of The Sarbanes-Oxley Act of 2002

I, Steven A. Raymund, Chairman of the Board of Directors and Chief Executive Officer of Tech Data Corporation, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(i) Tech Data’s Quarterly Report on Form 10-Q for the quarterly period ended October 31, 2003, (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: December 12, 2003

/s/    STEVEN A. RAYMUND        

Steven A. Raymund

Chairman of the Board of Directors and

Chief Executive Officer

EX-32.B

Exhibit 32-B

Certification of Chief Financial Officer

Pursuant to

U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of The Sarbanes-Oxley Act of 2002

I, Jeffery P. Howells, Executive Vice President and Chief Financial Officer of Tech Data Corporation, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(i) Tech Data’s Quarterly Report on Form 10-Q for the quarterly period ended October 31, 2003, (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: December 12, 2003

/s/    JEFFERY P. HOWELLS        

Jeffery P. Howells

Executive Vice President and

Chief Financial Officer

EX-99.A

Exhibit 99-A

Cautionary Statements for Purposes of the “Safe Harbor”

Provisions of the Private Securities Litigation Reform Act of 1995

The Private Securities Litigation Reform Act of 1995 (the “Act”) provides a “safe harbor” for “forward-looking statements” to encourage companies to provide prospective information, so long as such information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the forward-looking statement(s). Tech Data Corporation (the “Company” or “Tech Data”) desires to take advantage of the safe harbor provisions of the Act.

Except for historical information, the Company’s quarterly report on Form 10-Q for the quarter ended October 31, 2003 to which this exhibit is appended, other quarterly reports on Form 10-Q, the Company’s Annual Reports on Form 10-K, the Company’s current reports on Form 8-K, periodic press releases, as well as other public documents and statements, may contain forward-looking statements within the meaning of the Act.

In addition, representatives of the Company, from time to time, participate in speeches and calls with market analysts, conferences with investors and potential investors in the Company’s securities, and other meetings and conferences. Some of the information presented in such speeches, calls, meetings and conferences may be forward-looking within the meaning of the Act. The Company’s policies are in compliance with Regulation FD.

It is not reasonably possible to itemize all of the many factors and specific events that could affect the Company and/or the information technology logistics industry as a whole. Specific risk factors may also be communicated at the time forward-looking statements are made. The following additional factors could affect the Company’s actual results and cause such results to differ materially from those projected, forecasted, estimated, budgeted or otherwise expressed in forward-looking statements made by or on behalf of the Company.

Competition

The Company operates in a highly competitive environment, both in the United States and internationally. The computer wholesale logistics industry is characterized by intense competition, based primarily on product availability, credit availability, price, speed of delivery, ability to tailor specific solutions to customer needs, quality and depth of product lines and pre-sale and post-sale training, service and support. Weakness in demand in the market intensifies the competitive environment in which the Company operates. The Company competes with a variety of regional, national and international wholesale distributors, some of which have greater financial resources than the Company. In addition, the Company faces competition from direct sales by vendors that may be able to offer resellers lower prices than the Company. Products purchased from Hewlett-Packard Company (“HP”), represent in excess of 30% of sales by the Company. HP has elected to sell certain product lines direct. HP’s perception of the results of its direct sale policy with certain product lines may impact its decision on other product lines that the Company also carries. The Company also faces competition from companies entering or expanding into the logistics and product fulfillment and e-commerce supply chain services market.

Narrow Profit Margins

As a result of intense price competition in the industry, the Company has narrow gross profit and operating profit margins. These narrow margins magnify the impact on operating results of variations in sales and operating costs. Future gross profit and operating margins may be adversely affected by changes in product mix, vendor pricing actions and competitive and economic pressures.

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Risk of Declines in Inventory Value

The Company is subject to the risk that the value of its inventory will decline as a result of price reductions by vendors or technological obsolescence. It is the policy of most vendors of microcomputer products to protect distributors, such as the Company, that purchase directly from such vendors, from the loss in value of inventory due to technological change or the vendors’ price reductions. Some vendors, however, may be unwilling or unable to pay the Company for price protection claims or products returned to them under purchase agreements. Moreover, industry practices are sometimes not embodied in written agreements and do not protect the Company in all cases from declines in inventory value. No assurance can be given that such practices to protect distributors will continue, that unforeseen new product developments will not adversely affect the Company, or that the Company will be able to successfully manage its existing and future inventories.

Dependence on Information Systems

The Company is highly dependent upon its internal computer and telecommunication systems to operate its business. There can be no assurance that the Company’s information systems will not fail or experience disruptions, (such as due to deliberate attempts to attack the Company’s system infrastructure), that the Company will be able to attract and retain qualified personnel necessary for the operation of such systems, that the Company will be able to expand and improve its information systems, that the Company will be able to convert to new systems efficiently, that the Company will be able to integrate new programs effectively with its existing programs, or that the information systems of acquired companies will be sufficient to meet the Company’s standards or can be successfully converted into an acceptable information system on a timely and cost-effective basis. Any of such problems could have an adverse effect on the Company’s business.

The Company is currently upgrading its computer system used for operations in its European subsidiaries. The upgrade to SAP R3, and the conversion in some countries to SAP R3 from a non-SAP system will be implemented over the next several years. Certain implementation activities will require higher than typical expenses for various country operations during the upgrade installation phase. While the Company believes that its phased and careful approach to the implementation will lead to successful conversions with limited disruption to business operations, no assurance can be given that the upgrades and conversions will not cause disruption of the Company’s business.

Customer Credit Exposure

The Company sells its products to a large customer base of value-added resellers, corporate resellers, retailers and direct marketers. The Company finances a significant portion of such sales. As a result, the Company’s business could be adversely affected in the event of the deterioration of the financial condition of its customers, resulting in the customers’ inability to repay the Company. This risk increases because of the general economic downturn affecting a large number of the Company’s customers and in the event the Company’s customers do not adequately manage their business or properly disclose their financial condition.

Liquidity and Capital Resources

The Company’s business requires substantial capital to operate and to finance accounts receivable and product inventory that are not financed by trade creditors. The Company has historically relied upon cash generated from operations, bank credit lines, trade credit from its vendors, proceeds from public offerings of its Common Stock and proceeds from debt offerings to satisfy its capital needs and finance growth. The Company utilizes financing strategies such as receivables securitization, leases with tax advantages, subordinated convertible debentures and revolving credit facilities. As the financial markets change and new regulations come into effect, the cost of acquiring financing and the

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methods of financing may change. The Company will continue to need additional financing, including debt financing. The inability to obtain such sources of capital could have an adverse effect on the Company’s business. The Company’s revolving credit facilities contain various financial covenants that may limit the Company’s ability to borrow.

Fluctuations in Interest Rates

The Company utilizes financing strategies such as receivables securitization, leases with tax advantages, subordinated convertible debentures and revolving credit facilities. Many of these financing strategies involve variable rate debt, thus exposing us to risk of fluctuations in interest rates. Such fluctuations in interest rates could have an adverse effect on the Company’s business.

Acquisitions

As part of its growth strategy, the Company pursues the acquisition of companies that either complement or expand its existing business. As a result, the Company regularly evaluates potential acquisition opportunities, which may be material in size and scope. Acquisitions involve a number of risks and uncertainties, including expansion into new geographic markets and business areas, the requirement to understand local business practices, the diversion of management’s attention to the assimilation of the operations and personnel of the acquired companies, the possible requirement to upgrade the acquired companies’ management information systems to the Company’s standards, potential adverse short-term effects on the Company’s operating results and the amortization or impairment of any acquired intangible assets.

Foreign Currency Exchange Risks; Exposure to Foreign Markets

The Company conducts business in countries outside of the United States, which exposes the Company to fluctuations in foreign currency exchange rates. The Company may enter into short-term forward exchange or option contracts to hedge this risk according to its outlook on future exchange rates; nevertheless, fluctuations in foreign currency exchange rates could have an adverse effect on the Company’s business. In particular, the value of the Company’s equity investment in foreign countries may fluctuate based upon changes in foreign currency exchange rates. These fluctuations, which are carried in a cumulative translation adjustment account, may result in losses in the event a foreign subsidiary is sold or closed at a time when the foreign currency is weaker than when the Company initially invested in the country.

The Company’s international operations are subject to other risks such as the imposition of governmental controls, export license requirements, restrictions on the export of certain technology, political instability, trade restrictions, tariff changes, difficulties in staffing and managing international operations, changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), difficulties in collecting accounts receivable, longer collection periods and the impact of local economic conditions and practices. There can be no assurance that these and other factors will not have an adverse effect on the Company’s business.

Changes in Legislation

The Company operates in compliance with applicable laws and regulations. Where new legislation is enacted with minimal advance notice, or interpretations or new applications of existing law are made, the Company may need to implement changes in its policies or structure. As an example, the Company is currently responding to the corporate and accounting reforms enacted recently by the legislature, the Securities and Exchange Commission (“SEC”), and the stock exchanges. The

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Company makes plans for its structure and operations based upon existing laws and anticipated future changes in the law. The Company is susceptible to unanticipated changes in legislation, especially relating to income and other taxes, import/export laws, hazardous materials legislation, and other laws related to trade, accounting, and business activities. Such changes in legislation, both domestic and international, may have a significant adverse effect on the Company’s business.

Product Supply

The Company is dependent upon the supply of products available from its vendors. The industry is characterized by periods of severe product shortages due to vendors’ difficulty in projecting demand for certain products distributed by the Company. When such product shortages occur, the Company typically receives an allocation of product from the vendor. There can be no assurance that vendors will be able to maintain an adequate supply of products to fulfill all of the Company’s customer orders on a timely basis. Failure to obtain adequate product supplies, if available to competitors, could have an adverse effect on the Company’s business.

Delivery Systems

The Company relies on arrangements with independent shipping companies, such as Federal Express and United Parcel Service, for the delivery of its products from vendors and to customers. The failure or inability of these shipping companies to deliver products, or the unavailability of their shipping services, even temporarily, could have a material adverse effect on the Company’s business. The Company may also be adversely affected by an increase in freight surcharges due to rising fuel costs and added security. There can be no assurance that Tech Data will be able to pass along the full effect of an increase in these surcharges to its customers.

Vendor Relations

The Company relies on various rebates, cash discounts, and cooperative marketing programs offered by its vendors to defray expenses associated with distributing and marketing the vendors’ products. Currently, the rebates and purchase discounts offered by vendors are influenced by sales volumes and percentage increases in sales, and are subject to changes by the vendors. Additionally, certain of the Company’s vendors subsidize floor plan financing arrangements. A reduction by the Company’s vendors in any of these programs, or a significant change in their offerings, could have an adverse effect on the Company’s business.

The Company receives a significant percentage of revenues from products it purchases from relatively few manufacturers. Each manufacturer may make rapid, significant and adverse changes in their sales terms and conditions, or may merge with or acquire other significant manufacturers. The Company’s gross margins could be materially and negatively impacted if the Company is unable to pass through the impact of these changes to the Company’s reseller customers or cannot develop systems to manage ongoing supplier pass-through programs. In addition, the Company’s standard vendor distribution agreement permits termination without cause by either party upon 30 days notice. The loss of a relationship with any of the Company’s key vendors, a change in their strategy (such as increasing direct sales), the merging of significant manufacturers, or significant changes in terms on their products may adversely affect the Company’s business.

General Economic Conditions

From time to time the markets in which the Company sells its products experience weak economic conditions that may negatively affect the Company’s sales. To the extent that general economic conditions affect the demand for products sold by the Company, such conditions could have an adverse effect on the Company’s business. As a result of recent unfavorable economic conditions in many of the Company’s markets, the Company has experienced an overall reduction in sales. In

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response to this reduction in sales, the Company has significantly reduced its workforce. This has resulted in increased responsibilities for management and other personnel. There can be no assurance that the strain placed upon the Company’s management and other personnel, resulting from these increased responsibilities, will not have an adverse effect on the Company’s business.

Exposure to Natural Disasters, War, and Terrorism

The Company’s headquarter facilities, some of its logistics centers as well as certain vendors and customers are located in areas prone to natural disasters such as floods, hurricanes, tornadoes, or earthquakes. In addition, demand for the Company’s services is concentrated in major metropolitan areas. Adverse weather conditions, major electrical failures or other natural disasters in these major metropolitan areas may disrupt the Company’s business. The Company’s business could be adversely affected should its ability to distribute products be impacted by such an event.

The Company operates in multiple geographic markets, several of which may be susceptible to acts of war and terrorism. The Company’s business could be adversely affected should its ability to distribute products be impacted by such events.

The Company and many of its suppliers receive parts and product from Asia and operate in many parts of the world that may be susceptible to disease or epidemic that may result in disruption in the ability to receive or deliver products or other disruptions in operations.

Labor Strikes

The Company’s labor force is currently non-union with the exception of employees of certain European subsidiaries, which are subject to collective bargaining or similar arrangements. Additionally, the Company does business in certain foreign countries where labor disruption is more common than is experienced in the United States. Some of the freight carriers used by the Company are unionized. A labor strike by a group of the Company’s employees, one of the Company’s freight carriers, one of its vendors, a general strike by civil service employees, or a governmental shutdown could have an adverse effect on the Company’s business. Many of the products the Company sells are manufactured in countries other than the countries in which the Company’s logistics centers are located. The inability to receive products into the logistics centers because of government action or labor disputes at critical ports of entry may have a material adverse effect on the results of operations of the Company’s business.

Volatility of Common Stock

Because of the foregoing factors, as well as other variables affecting the Company’s operating results, past financial performance should not be considered a reliable indicator of future performance, and investors should not use historical trends to anticipate results or trends in future periods. In addition, the Company’s participation in a highly dynamic industry often results in significant volatility of the Common Stock price. Some of the factors that may affect the market price of the Common Stock, in addition to those discussed above, are changes in investment recommendations by securities analysts, changes in market valuations of competitors and key vendors, and fluctuations in the stock market price and volume of traded shares generally, but particularly in the technology sector.

Forecasts

The forecasts of volume, timing, and gross profits of orders are based on many factors and subjective judgments, and the Company cannot assure that the forecasts are accurate. The Company makes many management decisions on the basis of the forecasts, including the hiring and training of personnel, which represents a significant portion of our overall expenses. Thus, the failure to generate revenue and gross profits according to expectations would have a material adverse effect on the results of the operations of the Company.

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