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<SEC-DOCUMENT>0000950123-09-003515.txt : 20090226
<SEC-HEADER>0000950123-09-003515.hdr.sgml : 20090226
<ACCEPTANCE-DATETIME>20090226104939
ACCESSION NUMBER:		0000950123-09-003515
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		13
CONFORMED PERIOD OF REPORT:	20081231
FILED AS OF DATE:		20090226
DATE AS OF CHANGE:		20090226

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ARROW ELECTRONICS INC
		CENTRAL INDEX KEY:			0000007536
		STANDARD INDUSTRIAL CLASSIFICATION:	WHOLESALE-ELECTRONIC PARTS & EQUIPMENT, NEC [5065]
		IRS NUMBER:				111806155
		STATE OF INCORPORATION:			NY
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-04482
		FILM NUMBER:		09636118

	BUSINESS ADDRESS:	
		STREET 1:		25 HUB DR
		CITY:			MELVILLE
		STATE:			NY
		ZIP:			11747
		BUSINESS PHONE:		5163911300

	MAIL ADDRESS:	
		STREET 1:		50 MARCUS DR
		CITY:			MELVILLE
		STATE:			NY
		ZIP:			11747
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>y74529e10vk.htm
<DESCRIPTION>FORM 10-K
<TEXT>
<HTML>
<HEAD>
<TITLE>10-K</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 12pt">UNITED STATES SECURITIES AND EXCHANGE COMMISSION
</DIV>

<DIV align="center" style="font-size: 10pt">Washington, D.C. 20549
</DIV>

<DIV align="center" style="font-size: 14pt; margin-top: 12pt">FORM 10-K
</DIV>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%" style="font-size: 10pt">
<TR style="font-size: 10pt">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<TR valign="top">
    <TD align="center">[X]</TD>
    <TD>&nbsp;</TD>
    <TD>ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</TD>
</TR>
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt">For the fiscal year ended December&nbsp;31, 2008
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 6pt">OR
</DIV>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%" style="font-size: 10pt">
<TR style="font-size: 6pt">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<TR valign="top">
    <TD align="center">[&nbsp;&nbsp;]</TD>
    <TD>&nbsp;</TD>
    <TD>TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</TD>
</TR>
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 10pt">For the transition period from
 <U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> to <U>
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
</div>
<DIV align="center" style="font-size: 10pt; margin-top: 12pt">Commission file number 1-4482</DIV>

<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><b>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="center" style="font-size: 8pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>New York</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>11-1806155</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">(State or other jurisdiction of</div>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">(I.R.S. Employer</div></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">incorporation or organization)</div>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">Identification Number)</div></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><B>50 Marcus Drive, Melville, New York</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>11747</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">(Address of principal executive offices)</div>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><DIV align="center" style="font-size: 8pt">(Zip Code)</div></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>(631)&nbsp;847-2000</B><BR>
<DIV align="center" style="font-size: 8pt">(Registrant&#146;s telephone number, including area code)</DIV></DIV>


<DIV align="left" style="font-size: 9pt; margin-top: 10pt">Securities registered pursuant to Section 12(b) of the Act:

</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="45%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Title of each class</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Name of each exchange on which registered</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Common Stock, $1 par value
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">New York Stock Exchange</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Securities registered pursuant to Section 12(g) of the Act: None
</DIV>

<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule&nbsp;405 of the Securities Act.<br>
Yes &#091;X&#093; No &#091;&nbsp;&nbsp;&#093;
</DIV>







<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Indicate by check mark if the registrant is not required to file reports pursuant to Section&nbsp;13 or Section 15(d) of
the Exchange Act.<br>
Yes &#091;&nbsp;&nbsp;&#093; No &#091;X&#093;
</DIV>






<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Indicate by check mark whether the registrant (1)&nbsp;has filed all reports required to be filed by Section&nbsp;13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12&nbsp;months (or for such shorter period that the registrant was
required to file such reports), and (2)&nbsp;has been subject to such filing requirements for the past 90&nbsp;days.<br>
Yes &#091;X&#093; No &#091;&nbsp;&nbsp;&#093;
</DIV>

<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Indicate by check mark if disclosure of delinquent filers pursuant to Item&nbsp;405 of Regulation&nbsp;S-K is not contained
herein, and will not be contained, to the best of the registrant&#146;s knowledge, in definitive proxy or information
statements incorporated by reference in Part&nbsp;III of this Form 10-K or any amendment to this Form 10-K. &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;
</DIV>




<DIV align="justify" style="font-size: 10pt; margin-top: 10pt; text-indent: 0%">Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the definitions of &#147;large
accelerated filer,&#148; &#147;accelerated filer&#148; and &#147;smaller reporting company&#148; in Rule&nbsp;12b-2 of the
Exchange Act. (Check one):
</DIV>



<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="22%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" valign="top">Large accelerated filer &#091;X&#093;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Accelerated filer <FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" nowrap>&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD align="center" valign="top" nowrap>Non-accelerated filer
<FONT face="Wingdings">&#111;</FONT> (Do not check if a smaller reporting company)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" nowrap>Smaller reporting company <FONT face="Wingdings">&#111;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">Indicate by check mark whether the registrant is a shell company (as defined in Rule&nbsp;12b-2 of the Exchange Act).
Yes &#091;&nbsp;&nbsp;&#093;  No &#091;X&#093;
</DIV>

<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">The aggregate market value of voting stock held by non-affiliates of the registrant as of the last business day of the
registrant&#146;s most recently completed second fiscal quarter was $3,595,644,549.
</DIV>

<DIV align="justify" style="font-size: 9pt; margin-top: 10pt">There
were 119,335,854 shares of Common Stock outstanding as of February&nbsp;20, 2009.
</DIV>
<DIV align="center" style="font-size: 9pt; margin-top: 12pt"><B>DOCUMENTS INCORPORATED BY REFERENCE</B></DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The definitive proxy statement related to the registrant&#146;s Annual Meeting of Shareholders, to be held May&nbsp;1, 2009, is
incorporated by reference in Part&nbsp;III to the extent described therein.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
 <DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left">
<!-- TOC -->
</DIV>
<DIV align="left">
<A name="tocpage"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt">TABLE OF CONTENTS
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="7" align="center"><A href="#101">PART I<BR></A></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#102">Item&nbsp;1.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#102">Business</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#103">Item&nbsp;1A.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#103">Risk Factors</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#104">Item&nbsp;1B.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#104">Unresolved Staff Comments</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#105">Item&nbsp;2.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#105">Properties</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#106">Item&nbsp;3.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#106">Legal Proceedings</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#107">Item&nbsp;4.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#107">Submission of Matters to a Vote of Security Holders</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="7" align="center"><A href="#108">PART II<BR></A></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:15px; text-indent:-15px"><A href="#109">Item&nbsp;5.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#109">Market for Registrant&#146;s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#110">Item&nbsp;6.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#110">Selected Financial Data</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#111">Item&nbsp;7.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#111">Management's Discussion and Analysis of Financial Condition and Results of Operations</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#112">Item&nbsp;7A.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#112">Quantitative and Qualitative Disclosures About Market Risk</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#113">Item&nbsp;8.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#113">Financial Statements and Supplementary Data</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#114">Item&nbsp;9.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#114">Changes in and Disagreements with Accountants on Accounting and Financial Disclosure</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">88</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#115">Item&nbsp;9A.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#115">Controls and Procedures</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">88</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#116">Item&nbsp;9B.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#116">Other Information</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">90</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="7" align="center"><A href="#117">PART III<BR></A></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#118">Item&nbsp;10.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#118">Directors, Executive Officers, and Corporate Governance</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#119">Item&nbsp;11.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#119">Executive Compensation</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#120">Item&nbsp;12.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#120">Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#121">Item&nbsp;13.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#121">Certain Relationships and Related Transactions, and Director Independence</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#122">Item&nbsp;14.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#122">Principal Accounting Fees and Services</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="7" align="center"><A href="#123">PART IV<BR></A></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#124">Item&nbsp;15.</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><A href="#124">Exhibits and Financial Statement Schedules</A></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">92</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3"><DIV style="margin-left:15px; text-indent:-15px"><A href="#125">SIGNATURES</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv10wkwi.htm">EX-10.K.I: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv10wkwii.htm">EX-10.K.II: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv10wkwiii.htm">EX-10.K.III: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv10wkwiv.htm">EX-10.K.IV: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv10wkwvi.htm">EX-10.K.VI: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv21.htm">EX-21: SUBSIDIARY LISTING</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv23.htm">EX-23: CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv31wi.htm">EX-31.I: CERTIFICATION</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv31wii.htm">EX-31.II: CERTIFICATION</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv32wi.htm">EX-32.I: CERTIFICATION</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="y74529exv32wii.htm">EX-32.II: CERTIFICATION</A></FONT></TD></TR>
</TABLE>
</DIV>

<DIV align="left">
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</DIV>


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</DIV>



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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="left">
<A name="101"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>PART I</B>
</DIV>

<DIV align="left">
<A name="102"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;1. </B><U><B>Business</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Arrow Electronics, Inc. (the &#147;company&#148; or &#147;Arrow&#148;) is a global provider of products, services, and
solutions to industrial and commercial users of electronic components and enterprise computing
solutions. The company believes it is a leader in the electronics distribution industry in
operating systems, employee productivity, value-added programs, and total quality assurance.
Arrow, which was incorporated in New York in 1946, serves approximately 800 suppliers and
approximately 130,000 original equipment manufacturers (&#147;OEMs&#148;), contract manufacturers (&#147;CMs&#148;),
and commercial customers.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Serving its industrial and commercial customers as a supply channel partner, the company offers
both a wide spectrum of products and a broad range of services and solutions, including materials
planning, design services, programming and assembly services, inventory management, and a variety
of online supply chain tools.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Arrow&#146;s diverse worldwide customer base consists of OEMs, CMs, and other commercial customers.
Customers include manufacturers of consumer and industrial equipment (including machine tools,
factory automation, and robotic equipment), telecommunications products, automotive and
transportation, aircraft and aerospace equipment, scientific and medical devices, and computer and
office products. Customers also include value-added resellers (&#147;VARs&#148;) of enterprise computing
solutions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains approximately 250 sales facilities and 21 distribution and value-added
centers in 53 countries and territories, serving over 70 countries and territories. Through this
network, Arrow provides one of the broadest product offerings in the electronic components and
enterprise computing solutions distribution industries and a wide range of value-added services to
help customers reduce their time to market, lower their total cost of ownership, introduce
innovative products through demand creation opportunities, and enhance their overall
competitiveness.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has two business segments. The company distributes electronic components to OEMs and
CMs through its global components business segment and provides enterprise computing solutions to
VARs through its global enterprise computing solutions (&#147;ECS&#148;) business segment. For 2008,
approximately 68% of the company&#146;s sales were from the global components business segment, and
approximately 32% of the company&#146;s sales were from the global ECS business segment. The financial
information about the company&#146;s business segments and geographic operations can be found in Note 16
of the Notes to Consolidated Financial Statements.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Operating efficiency and working capital management remain a key focus of the company&#146;s business
initiatives to grow sales faster than the market, grow profits faster than sales, and increase
return on invested capital. To achieve its financial objectives, the company seeks to capture
significant opportunities to grow across products, markets, and geographies. To supplement its
organic growth strategy, the company continually evaluates strategic acquisitions to broaden its
product offerings, increase its market penetration, and/or expand its geographic reach.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Global Components</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s global components business segment, one of the largest distributors of electronic
components and related services in the world, covers the world&#146;s three largest electronics markets
&#151; North America, EMEASA (Europe, Middle East, Africa, and South America), and the Asia Pacific
region.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">North America includes sales and marketing organizations in the United States, Canada, and Mexico.
In February&nbsp;2008, the global components business segment acquired all the assets and operations of
ACI Electronics LLC (&#147;ACI&#148;), a distributor of electronic components used in defense and aerospace
applications. This acquisition further bolstered the company&#146;s leading position in the North
American defense and aerospace market and expanded the company&#146;s leading market share in many
technology segments including military discretes.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the EMEASA region, Arrow operates in Argentina, Austria, Belgium, Brazil, Czech Republic,
Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Israel, Italy, Latvia,
Lithuania, the Netherlands, Norway, Poland, Portugal, Romania, the Russian Federation, Slovakia,
Slovenia, Spain, Sweden, Switzerland, Turkey, Ukraine, and the United Kingdom.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the Asia Pacific region, Arrow operates in Australia, China, Hong Kong, India, Japan, Korea,
Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand, and Vietnam. Over the past three
years the global components business segment completed the following strategic acquisitions to
broaden its product offerings and expand its geographic reach in the Asia Pacific region:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In June&nbsp;2007, acquired the component distribution business of Adilam Pty. Ltd.
(&#147;Adilam&#148;), a leading electronic components distributor in Australia and New Zealand.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In November&nbsp;2007, acquired Universe Electron Corporation (&#147;UEC&#148;), a distributor of
semiconductor and multimedia products in Japan.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In February&nbsp;2008, acquired the franchise components distribution business of Hynetic
Electronics and Shreyanics Electronics (&#147;Hynetic&#148;) in India.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In July&nbsp;2008, acquired the components distribution business of Achieva Ltd. (&#147;Achieva&#148;),
a value-added distributor of semiconductors and electro-mechanical devices based in
Singapore. Achieva has a presence in eight countries within the Asia Pacific region and is
focused on creating value for its partners through technical support and demand creation
activities.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In December&nbsp;2008, acquired Excel Tech, Inc. (&#147;Excel Tech&#148;), the sole Broadcom
distributor in Korea, and Eteq Components Pte Ltd (&#147;Eteq Components&#148;), a Broadcom-based
franchise components distribution business in the ASEAN region and China.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Within the global components business segment, approximately 68% of the company&#146;s sales consist of
semiconductor products and related services, approximately 21% consist of passive,
electro-mechanical, and interconnect products, consisting primarily of capacitors, resistors,
potentiometers, power supplies, relays, switches, and connectors, and approximately 11% consist of
computing, memory, and other products.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Most of the company&#146;s customers require delivery of their orders on schedules or volumes that are
generally not available on direct purchases from manufacturers.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Most manufacturers of electronic components rely on authorized distributors, such as the company,
to augment their sales and marketing operations. As a marketing, stocking, technical support, and
financial intermediary, the distributor relieves manufacturers of a portion of the costs and
personnel associated with these functions (including otherwise sizable investments in finished
goods inventories, accounts receivable systems, and distribution networks), while providing
geographically dispersed selling, order processing, and delivery capabilities. At the same time,
the distributor offers to a broad range of customers the convenience of accessing, from a single
source, multiple products from multiple suppliers and rapid or scheduled deliveries, as well as
other value-added services, such as materials management, memory programming capabilities, and
financing solutions. The growth of the electronics distribution industry is fostered by the many
manufacturers who recognize their authorized distributors as essential extensions of their
marketing organizations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Global ECS</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s global ECS business segment is a leading distributor of enterprise and midrange
computing products, services, and solutions to VARs in North America, Europe, the Middle East and
Africa. Over the past three years, the company has transformed its enterprise computing solutions business into a
stronger organization with broader global reach, increased market share in the fast-growing product
segments of
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">software and storage, and a more robust customer and supplier base. Execution on the
company&#146;s strategic objectives resulted in the global ECS business segment becoming a leading
value-added distributor of enterprise products for various suppliers including IBM, Sun
Microsystems, and Hewlett-Packard and a leading distributor of enterprise storage and security and
virtualization software. The global ECS&#146; geographic footprint has expanded from two countries (the
United States and Canada) in 2005, to 28 countries around the world, including Austria, Belgium,
Bulgaria, Canada, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary,
Israel, Latvia, Lithuania, Luxembourg, Morocco, the Netherlands, Norway, Poland, Romania, Serbia,
Slovakia, Slovenia, Sweden, Switzerland, the United Kingdom, and the United States. Over the past
three years, the global ECS business segment completed the following acquisitions:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In February&nbsp;2006, acquired SKYDATA Corporation, a Canadian value-added distributor of
data storage solutions, which significantly strengthened the company&#146;s presence in Canada.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In November&nbsp;2006, acquired Alternative Technology, Inc. (&#147;Alternative Technology&#148;), a
leading specialty software distributor of access infrastructure, security, and
virtualization solutions in North America. This transaction created significant
opportunities in the fast-growing value-added software market.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In December&nbsp;2006, acquired InTechnology Distribution plc&#146;s specialty distribution
division (&#147;InTechnology&#148;) that further strengthened the company&#146;s software and storage
capabilities. Based in Harrogate, England, the InTechnology transaction extended the
business&#146; operations into the United Kingdom, the second largest information technology
market in Europe.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In March&nbsp;2007, acquired substantially all of the assets and operations of its KeyLink
Systems Group business (&#147;KeyLink&#148;) from Agilysys, Inc. (&#147;Agilysys&#148;). The acquisition of
KeyLink, a leading value-added distributor of enterprise servers, storage and software in
the United States and Canada, brought considerable scale, cross-selling opportunities and
mid-market reseller focus to the company&#146;s global ECS business segment. The company&#146;s
global ECS business segment also entered into a long-term procurement agreement with
Agilysys.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In September&nbsp;2007, acquired Centia Group Limited and AKS Group AB (&#147;Centia/AKS&#148;),
specialty distributors of access infrastructure, security and virtualization software
solutions in Europe.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">In June&nbsp;2008, acquired LOGIX S.A. (&#147;LOGIX&#148;), a subsidiary of Groupe OPEN. LOGIX is a
leading value-added distributor of midrange servers, storage, and software to over 6,500
partners in 11 countries. This acquisition established the global ECS business segment&#146;s
presence in the Middle East and Africa, increased its scale throughout Europe, strengthened
existing relationships with key suppliers, and brought a highly talented management team to
the company.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Within the global ECS business segment, approximately 25% of the company&#146;s sales consist of
proprietary servers, 8% consist of industry standard servers, 27% consist of software, 27% consist
of storage, and 13% consist of services.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Information technology (&#147;IT&#148;) demands for today&#146;s businesses are evolving. As IT needs become more
complex, corporate information officers are increasingly seeking products bundled into solutions
that support business communication, operations, processes, and transactions in a competitive
manner.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Global ECS provides VARs with many value-added services, including but not limited to, vertical
market expertise, systems level training and certification, solutions testing at Arrow ECS
Solutions Centers, financing support, marketing augmentation, complex order configuration, and
access to a one-stop-shop for mission critical solutions. Midsize and large companies rely on VARs
for their IT needs, and global
ECS works with these VARs to tailor complex, highly-technical mid-market and enterprise solutions
in a cost competitive manner. VARs range in size from small and medium-sized businesses to large
global organizations and are typically structured as sales organizations and service providers.
They purchase
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">enterprise and mid-market computing solutions from distributors and manufacturers and
resell them to end-users. The increasing complexity of these solutions and increasing demand for
bundled solutions is changing how VARs go to market and increasing the importance of global ECS&#146;
value-added services. Global ECS&#146; suppliers benefit from affordable mid-market access, demand
creation, speed to market, and enhanced supply chain efficiency. For suppliers, global ECS is the
aggregation point to over 18,000 VARs.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In better serving the needs of both suppliers and VARs, the company&#146;s focus is to be an extension
of the supplier&#146;s sales and marketing organization and manage the supply chain, as well as to
leverage the company&#146;s strong relationships with the world&#146;s foremost hardware, software and
storage manufacturers to better enable VARs to deliver end-to-end solutions to their customers.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Customers and Suppliers</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company and its affiliates serve approximately 130,000 industrial and commercial customers.
Industrial customers range from major OEMs and CMs to small engineering firms, while commercial
customers primarily include VARs and OEMs. No single customer accounted for more than 3% of the
company&#146;s 2008 consolidated sales.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The products offered by the company are sold by both field sales representatives, who regularly
call on customers in assigned market areas, and by inside sales personnel, who call on customers by
telephone or email from the company&#146;s selling locations. The company also has sales teams that
focus on small and emerging customers where sales representatives regularly call on customers by
telephone or email from centralized selling locations, and inbound sales agents serve customers
that call into the company.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Each of the company&#146;s North American selling locations and primary distribution centers in the
global components business segment are electronically linked to the company&#146;s central computer
system, which provides fully integrated, online, real-time data with respect to nationwide
inventory levels and facilitates control of purchasing, shipping, and billing. The company&#146;s
international operations in the global components business segment utilize similar online,
real-time computer systems, with access to the company&#146;s Worldwide Stock Check System. This system
provides global access to real-time inventory data.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company sells the products of approximately 800 suppliers. Sales from products and services
from IBM accounted for approximately 11% of the company&#146;s consolidated sales in 2008. No other
single supplier accounted for more than 10% of the company&#146;s consolidated sales in 2008. The
company believes that many of the products it sells are available from other sources at competitive
prices. However, certain parts of the company&#146;s business, such as the company&#146;s global ECS
business segment, rely on a limited number of suppliers with the strategy of providing focused
support, deep product knowledge, and customized service to suppliers and VARs. Most of the
company&#146;s purchases are pursuant to authorized distributor agreements, which are typically
cancelable by either party at any time or on short notice.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Distribution Agreements</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">It is the policy of most manufacturers to protect authorized distributors, such as the company,
against the potential write-down of inventories due to technological change or manufacturers&#146; price
reductions. Write-downs of inventories to market value are based upon contractual provisions,
which typically provide certain protections to the company for product obsolescence and price
erosion in the form of return privileges, scrap allowances, and price protection. Under the terms
of the related distributor agreements and assuming the distributor complies with certain
conditions, such suppliers are required to credit the distributor for reductions in manufacturers&#146;
list prices. As of December&nbsp;31, 2008, this type of arrangement covered approximately 72% of the
company&#146;s consolidated inventories. In addition, under the terms of many such
agreements, the distributor has the right to return to the manufacturer, for credit, a defined
portion of those inventory items purchased within a designated period of time.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A manufacturer, which elects to terminate a distribution agreement, is generally required to
purchase from
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">the distributor the total amount of its products carried in inventory. As of
December&nbsp;31, 2008, this type of repurchase arrangement covered approximately 74% of the company&#146;s
consolidated inventories.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">While these industry practices do not wholly protect the company from inventory losses, the company
believes that they currently provide substantial protection from such losses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Competition</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s business is extremely competitive, particularly with respect to prices, franchises,
and, in certain instances, product availability. The company competes with several other large
multinational and national distributors, as well as numerous regional and local distributors. As
one of the world&#146;s largest electronics distributors, the company&#146;s financial resources and sales
are greater than most of its competitors.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Employees</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company and its affiliates employed approximately 12,700 employees worldwide as of December&nbsp;31,
2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Available Information</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company makes the annual report on Form 10-K, quarterly reports on Form 10-Q, any current
reports on Form 8-K, and amendments to any of these reports available through its website
(<u>http://www.arrow.com</u>) as soon as reasonably practicable after the company files such material with
the U.S. Securities and Exchange Commission (&#147;SEC&#148;). The information posted on the company&#146;s
website is not incorporated into this annual report on Form 10-K. In addition, the SEC maintains a
website (<u>http://www.sec.gov</u>) that contains reports, proxy and information statements, and other
information regarding issuers that file electronically with the SEC. The annual report on Form 10-K
for the year ended December&nbsp;31, 2008, includes the certifications of the company&#146;s Chief Executive
Officer and Chief Financial Officer as Exhibits 31 (i)&nbsp;and 31 (ii), respectively, which were filed
with the SEC as required under Section&nbsp;302 of the Sarbanes-Oxley Act of 2002 and certify the
quality of the company&#146;s public disclosure. The company&#146;s Chief Executive Officer has also
submitted a certification to the New York Stock Exchange (the &#147;NYSE&#148;) certifying that he is not
aware of any violations by the company of NYSE corporate governance listing standards.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Executive Officers</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table sets forth the names, ages, and the positions held by each of the executive
officers of the company as of February&nbsp;26, 2009:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="65%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Name</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="3" style="border-bottom: 1px solid #000000"><B>Age</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Position</B></TD>
</TR>
<tr>
    <TD colspan="5">&nbsp;</TD>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">William E. Mitchell
</DIV></TD>
    <TD>&nbsp;</TD>

    <TD align="left" valign="top" colspan="2">64</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chairman of the Board of Directors and Chief Executive Officer</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Michael J. Long
</DIV></TD>

    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="left" valign="top" colspan="2">50</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director, President, and Chief Operating Officer</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Peter S. Brown
</DIV></TD>
    <TD>&nbsp;</TD>

    <TD align="left" valign="top" colspan="2">58</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Senior Vice President, General Counsel, and Secretary</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">John P. McMahon
</DIV></TD>
    <TD>&nbsp;</TD>

    <TD align="left" valign="top" colspan="2">56</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Senior Vice President, Human Resources</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Paul J. Reilly
</DIV></TD>
    <TD>&nbsp;</TD>

    <TD align="left" valign="top" colspan="2">52</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Senior Vice President and Chief Financial Officer</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Set forth below is a brief account of the business experience during the past five years of each
executive officer of the company.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">William E. Mitchell was appointed Chairman of the Board of Directors in May&nbsp;2006 and has been Chief
Executive Officer of the company since February&nbsp;2003. He also served as President of the company
from February&nbsp;2003 until February&nbsp;2008. Prior to joining the company, he served as Executive Vice
President of Solectron Corporation and President of Solectron Global Services, Inc. since March
1999.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Michael J. Long was appointed Director, President, and Chief Operating Officer of the company in
February&nbsp;2008. Prior thereto he served as Senior Vice President of the company from January&nbsp;2006
to February&nbsp;2008 and previously served as Vice President of the company for more than five years.
He served as President, Arrow Global Components from September&nbsp;2006 to February&nbsp;2008; served as
President, North America and Asia/Pacific Components from January&nbsp;2006 until September&nbsp;2006;
President, North America from May&nbsp;2005 to December&nbsp;2005; and President and Chief Operating Officer
of Arrow Enterprise Computing Solutions from July&nbsp;1999 to April&nbsp;2005.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Peter S. Brown has been Senior Vice President, General Counsel, and Secretary of the company for
more than five years.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">John P. McMahon was appointed Senior Vice President, Human Resources of the company in March&nbsp;2007.
Prior to joining the company, he served as Senior Vice President and Chief Human Resource Officer
of UMass Memorial Health Care System from August&nbsp;2005 to March&nbsp;2007; Senior Vice President of
Global Human Resources at Fisher Scientific from June&nbsp;2004 to June&nbsp;2005; and Chief Human Resources
Officer at Terra Lycos from August&nbsp;1999 to May&nbsp;2004.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Paul J. Reilly was appointed Senior Vice President of the company in May&nbsp;2005 and, prior thereto,
he served as Vice President of the company for more than five years. He has been Chief Financial
Officer of the company for more than five years.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left">
<A name="103"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;1A. </B><U><B>Risk Factors</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Described below and throughout this report are certain risks that the company&#146;s management believes
are applicable to the company&#146;s business and the industry in which it operates. If any of the
described events occur, the company&#146;s business, results of operations, financial condition,
liquidity, or access to the capital markets could be materially adversely affected. When stated
below that a risk may have a material adverse effect on the company&#146;s business, it means that such
risk may have one or more of these effects. There may be additional risks that are not presently
material or known. There are also risks within the economy, the industry and the capital markets
that could materially adversely affect the company, including those associated with an economic
recession, and global economic slowdown. The recent financial crisis affecting the banking systems
and financial markets and the current uncertainty in global economic conditions have resulted in a
tightening in the credit markets, a low level of liquidity in many financial markets, and extreme
volatility in the credit and equity markets. These factors affect businesses generally and, as a
result, are not discussed in detail below except to the extent such conditions could materially
affect the company and its customers and suppliers in particular ways.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>If the company is unable to maintain its relationships with its suppliers or if the suppliers
materially change the terms of their existing agreements with the company, the company&#146;s business
could be materially adversely affected.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A substantial portion of the company&#146;s inventory is purchased from suppliers with which the company
has entered into non-exclusive distribution agreements. These agreements are typically cancelable
on short notice (generally 30 to 90&nbsp;days). Certain parts of the company&#146;s business, such as the
company&#146;s global ECS business, rely on a limited number of suppliers. For example, sales from
products and services from one of the company&#146;s suppliers, IBM, accounted for approximately 11% of
the company&#146;s consolidated sales in 2008. To the extent that the company&#146;s significant suppliers
reduce the amount of products they sell through distribution, or are unwilling to continue to do
business with the company, or are unable to continue to meet its obligations, the company&#146;s
business could be materially adversely affected. In addition, to the extent that the company&#146;s
suppliers modify the terms of their contracts with the company, or extend lead times, limit
supplies due to capacity constraints, or other factors, there could be a material adverse effect on
the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The competitive pressures the company faces could have a material adverse effect on the company&#146;s
business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The market for the company&#146;s products and services is very competitive and subject to rapid
technological change. Not only does the company compete with other distributors, it also competes
for customers with many of its own suppliers. Additional competition has emerged from third-party
logistics providers, catalogue distributors, and brokers. The company&#146;s failure to maintain and
enhance its competitive position could adversely affect its business and prospects. Furthermore,
the company&#146;s efforts to compete in the marketplace could cause deterioration of gross profit
margins and, thus, overall profitability. The sizes of the company&#146;s competitors vary across
market sectors, as do the resources the company has allocated to the sectors in which it does
business. Therefore, some of the competitors may have a more extensive customer base than the
company in one or more of its market sectors.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>Products sold by the company may be found to be defective and, as a result, warranty and/or product
liability claims may be asserted against the company, which may have a material adverse effect on
the company.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company sells its components at prices that are significantly lower than the cost of the
equipment or other goods in which they are incorporated. Since a defect or failure in a product
could give rise to failures in the end products that incorporate them, the company may face claims
for damages (such as consequential damages) that are disproportionate to the revenues and profits
it receives from the products involved in the claims. While the company typically has provisions
in its supplier agreements that hold the supplier accountable for defective products, and the
company and its suppliers generally
exclude consequential damages in their standard terms and conditions, the company&#146;s ability to
avoid
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">such liabilities may be limited as a result of differing factors, such as the inability to
exclude such damages due to the laws of some of the countries where it does business. The
company&#146;s business could be materially adversely affected as a result of a significant quality or
performance issue in the products sold by the company, if it is required to pay for the associated
damages. Although the company currently has product liability insurance, such insurance is limited
in coverage and amount.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>Declines in value and other factors pertaining to the company&#146;s inventory could materially
adversely affect its business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The market for the company&#146;s products and services is subject to rapid technological change,
evolving industry standards, changes in end-market demand, and regulatory requirements, which can
contribute to the decline in value or obsolescence of inventory. During an economic downturn,
prices could decline due to various factors including an oversupply of product and, therefore,
there may be greater risk of declines in inventory value. Although most of the company&#146;s suppliers
provide the company with certain protections from the loss in value of inventory (such as price
protection and certain rights of return), the company cannot be sure that such protections will
fully compensate it for the loss in value, or that the suppliers will choose to, or be able to,
honor such agreements. For example, many of the company&#146;s suppliers will not allow products to be
returned after they have been held in inventory beyond a certain amount of time, and, in most
instances, the return rights are limited to a certain percentage of the amount of product the
company purchased in a particular time frame. In addition, as discussed below, the company
historically has sold and continues to sell products that contain substances that are regulated, or
may be regulated, by various environmental laws. Some of the company&#146;s inventory may become
obsolete as a result of these or other existing or new regulations. All of these factors
pertaining to inventory could have a material adverse effect on the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company is subject to environmental laws and regulations that could materially adversely affect
its business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is subject to a wide and ever-changing variety of international and U.S. federal,
state, and local laws and regulations, compliance with which may require substantial expense. Of
particular note are three European Union (&#147;EU&#148;) directives known as the (i)&nbsp;Restriction of Certain
Hazardous Substances Directive (&#147;RoHS&#148;), (ii)&nbsp;the Waste Electrical and Electronic Equipment
Directive, and (iii)&nbsp;the Registration, Evaluation and Authorisation of Chemicals (&#147;REACH&#148;). The
first two directives restrict the distribution of products within the EU containing certain
substances and require a manufacturer or importer to recycle products containing those substances.
REACH will require companies to inform all purchasers of certain products in the EU to what extent
they contain certain substances covered by the legislation. In addition, China has passed the
Management Methods on Control of Pollution from Electronic Information Products, which prohibits
the import of products for use in China that contain similar substances banned by the RoHS
directive. Failure to comply with these directives or any other applicable environmental
regulations could result in fines or suspension of sales. Additionally, these directives and
regulations may result in the company having non-compliant inventory that may be less readily
salable or have to be written off.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In addition, some environmental laws impose liability, sometimes without fault, for investigating
or cleaning up contamination on or emanating from the company&#146;s currently or formerly owned,
leased, or operated property, as well as for damages to property or natural resources and for
personal injury arising out of such contamination. As the distribution business, in general, does
not involve the manufacture of products, it is typically not subject to significant liability in
this area. However, there may be occasions, including through acquisitions, where environmental
liability arises. Such liability may be joint and several, meaning that the company could be held
responsible for more than its share of the liability involved, or even the entire share. In
addition, the presence of environmental contamination could also interfere with ongoing operations
or adversely affect the company&#146;s ability to sell or lease its properties. The discovery of
contamination for which the company is responsible, or the enactment of new laws and regulations,
or changes in how existing requirements are enforced, could require the company to incur costs for
compliance or subject it to unexpected liabilities.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The foregoing matters could materially adversely affect the company&#146;s business.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company is currently involved in the investigation and remediation of environmental matters at
two sites as a result of its Wyle Electronics acquisition, and the company is in litigation related
to those sites.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2000, the company acquired Wyle Electronics (&#147;Wyle&#148;) and assumed its outstanding liabilities,
including responsibility for environmental problems at sites Wyle had previously owned. The Wyle
purchase agreement includes an indemnification from the seller, now known as E.ON AG, in favor of
the company, covering virtually all costs arising out of or in connection with those environmental
obligations. Two sites are known to have environmental issues, one at Norco, California and the
other at Huntsville, Alabama. The company has thus far borne most of the cost of the investigation
and remediation of the Norco and Huntsville sites, under the direction of the cognizant state
agencies. The company has spent approximately $32&nbsp;million to date in connection with these sites.
In addition, the company was named as a defendant in a private lawsuit filed in connection with
alleged contamination at a small industrial building formerly leased by Wyle Laboratories in El
Segundo, California. The lawsuit was settled, but the possibility remains that government entities
or others may attempt to involve the company in further characterization or remediation of
groundwater issues in the area.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">E.ON AG acknowledged liability under the contractual indemnities with respect to the Norco and
Huntsville sites and made a small initial payment, but has subsequently refused to make further
payments. As a result, the company is suing E.ON AG in the Regional Court in Frankfurt, Germany.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In addition, the company is a defendant in two actions brought in Riverside, California, County
Court by landowners and residents alleging personal injury and property damage caused by
contaminated groundwater and related soil-vapor found in certain residential areas adjacent to the
Norco site. Co-defendant Wyle Laboratories, formerly a division of Wyle, has demanded defense and
indemnification from the company in connection with the litigation, which the company must provide
subject to the terms of several related agreements and orders. These costs are also part of the
company&#146;s claim against E.ON AG.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As successor-in-interest to Wyle, the company is the beneficiary of the various Wyle insurance
policies that covered liabilities arising out of operations at the two contaminated sites. Certain
of the carriers of the primary insurance policies implicated in the pending claims have undertaken
substantial portions of the defense of the company in the Riverside County cases, and the company
has recovered approximately $10&nbsp;million from them to date. The company has sued certain of the
umbrella liability policy carriers, however, they have yet to make payment on the tendered losses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes strongly in the merits of its positions regarding the E.ON AG indemnity, the
liabilities of the insurance carriers, and the absence of compensable damage to the Riverside
County plaintiffs, but there can be no guarantee of the outcome of litigation. Should and to the
extent some or all of the insurance policies at issue prove insufficient or unavailable, and E.ON
AG prevails in the litigation pending in Germany, the company would be responsible for the costs.
The total costs of 1) the investigation and remediation of the two sites, 2) the defense of the
company and the defense and indemnity of Wyle Laboratories in the Riverside County cases, 3) the
potential amount of any adverse verdict in those cases, and 4) the amount of any shortfall in the
availability of the E.ON AG indemnity and/or the insurance coverage are all as yet undetermined.
Any or all of those costs could have a material adverse effect on the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company may not have adequate or cost-effective liquidity or capital resources.</I></B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company requires cash or committed liquidity facilities for general corporate purposes, such as
funding its ongoing working capital, acquisition, and capital expenditure needs, as well as to make
interest payments on and to refinance indebtedness. At December&nbsp;31, 2008, the company had cash and
cash
equivalents of $451.3&nbsp;million. In addition, the company currently has access to committed credit
lines of $1.4&nbsp;billion. The company&#146;s ability to satisfy its cash needs depends on its ability to
generate
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">cash from operations and to access the financial markets, both of which are subject to
general economic, financial, competitive, legislative, regulatory, and other factors that are
beyond its control.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company may, in the future, need to access the financial markets to satisfy its cash needs.
The company&#146;s ability to obtain external financing is affected by general financial market
conditions and the company&#146;s debt ratings. While, thus far, uncertainties in global credit markets
have not significantly affected the company&#146;s access to capital, future financing could be
difficult or more expensive. Further, any increase in the company&#146;s level of debt, change in
status of its debt from unsecured to secured debt, or deterioration of its operating results may
cause a reduction in its current debt ratings. Any downgrade in the company&#146;s current debt rating
or tightening of credit availability could impair the company&#146;s ability to obtain additional
financing or renew existing credit facilities on acceptable terms. Under the terms of any external
financing, the company may incur higher than expected financing expenses and become subject to
additional restrictions and covenants. For example, the company&#146;s existing debt agreements contain
restrictive covenants, including covenants requiring compliance with specified financial ratios,
and a failure to comply with these or any other covenants may result in an event of default. The
company&#146;s lack of access to cost-effective capital resources, an increase in the company&#146;s
financing costs, or a breach of debt instrument covenants could have a material adverse effect on
the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The agreements governing some of the company&#146;s financing arrangements contain various covenants and
restrictions that limit some of management&#146;s discretion in operating the business and could prevent
the company from engaging in some activities that may be beneficial to its business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The agreements governing the company&#146;s financings contain various covenants and restrictions that,
in certain circumstances, could limit its ability to:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">grant liens on assets;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">make restricted payments (including paying dividends on capital stock or redeeming or
repurchasing capital stock);</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">make investments;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">merge, consolidate, or transfer all or substantially all of its assets;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">incur additional debt; or</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">engage in certain transactions with affiliates.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of these covenants and restrictions, the company may be limited in how it conducts its
business and may be unable to raise additional debt, compete effectively, or make investments.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company&#146;s failure to have long-term sales contracts may have a material adverse effect on its
business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Most of the company&#146;s sales are made on an order-by-order basis, rather than through long-term
sales contracts. The company generally works with its customers to develop non-binding forecasts
for future volume of orders. Based on such non-binding forecasts, the company makes commitments
regarding the level of business that it will seek and accept, the inventory that it purchases, and
the levels of utilization of personnel and other resources. A variety of conditions, both specific
to each customer and generally affecting each customer&#146;s industry, may cause customers to cancel,
reduce, or delay orders that were either previously made or anticipated, go bankrupt or fail, or
default on their payments. Generally, customers cancel, reduce, or delay purchase orders and
commitments without penalty. The company seeks to mitigate these risks, in some cases, by entering
into noncancelable/nonreturnable sales agreements, but there is no guarantee that such agreements
will adequately protect the company. Significant or numerous cancellations, reductions, delays in
orders by customers, losses of customers, and/or customer defaults on payment could materially
adversely affect the company&#146;s business.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>A large portion of the company&#146;s revenues comes from the sale of semiconductors, which, in the
past, has been a cyclical industry.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The semiconductor industry historically has experienced fluctuations in product supply and demand,
often associated with changes in technology and manufacturing capacity and subject to significant
economic market upturns and downturns. Sales of semiconductor products and related services
represented approximately 46%, 48%, and 56% of the company&#146;s consolidated sales in 2008, 2007, and
2006, respectively, and the company&#146;s revenues and profitability, particularly in its global
components business segment, tend to closely follow the strength or weakness of the semiconductor
market. Any cyclical downturn in the technology industry, particularly in the semiconductor sector,
could have a material adverse effect on the company&#146;s business and negatively impact its ability to
maintain historical profitability levels.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company&#146;s non-U.S. sales represent a significant portion of its revenues, and consequently, the
company is increasingly exposed to risks associated with operating internationally.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, 2007, and 2006, approximately 54%, 50%, and 53%, respectively, of the company&#146;s sales came
from its operations outside the United States. As a result of the company&#146;s international sales
and locations, its operations are subject to a variety of risks that are specific to international
operations, including the following:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">import and export regulations that could erode profit margins or restrict exports;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">the burden and cost of compliance with international laws, treaties, and technical
standards and changes in those regulations;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">potential restrictions on transfers of funds;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">currency fluctuations;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">import and export duties and value-added taxes;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">transportation delays and interruptions;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">uncertainties arising from local business practices and cultural considerations; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">potential military conflicts and political risks.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Furthermore, products the company sells which are either manufactured in the United States or based
on U.S. technology (&#147;U.S. Products&#148;) are subject to the Export Administration Regulations (&#147;EAR&#148;)
when exported and re-exported to and from all international jurisdictions, in addition to the local
jurisdiction&#146;s export regulations applicable to individual shipments. Licenses or proper license
exceptions may be required by local jurisdictions&#146; export regulations, including EAR, for the
shipment of certain U.S. Products to certain countries, including China, India, Russia, and other
countries in which the company operates. Non-compliance with the EAR or other applicable export
regulations can result in a wide range of penalties including the denial of export privileges,
fines, criminal penalties, and the seizure of commodities. In the event that any export regulatory
body determines that any shipments made by the company violate the applicable export regulations,
the company could be fined significant sums and/or its export capabilities could be restricted,
which could have a material adverse effect on the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Also, the company&#146;s operating income margins are lower in certain geographic markets. Operating
income in the components business in Asia/Pacific tends to be lower than operating income in North
America and Europe. As sales in Asia/Pacific increased as a percentage of overall sales,
consolidated operating income margins have fallen. The financial impact of the lower operating
income on returns on working capital was offset, in part, by lower working capital requirements.
While the company has and will continue to adopt measures to reduce the potential impact of losses
resulting from the risks of doing business abroad, it cannot ensure that such measures will be
adequate and, therefore, could have a material adverse effect on its business.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>When the company makes acquisitions, it may not be able to successfully integrate them.</I></B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">If the company is unsuccessful in integrating its acquisitions, or if integration is more difficult
than anticipated, the company may experience disruptions that could have a material adverse effect
on its business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company&#146;s goodwill and identifiable intangible assets could become impaired, which could reduce
the value of its assets and reduce its net income in the year in which the write-off occurs.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill represents the excess of the cost of an acquisition over the fair value of the assets
acquired. The company also ascribes value to certain identifiable intangible assets, which consist
primarily of customer relationships, non-competition agreements, a long-term procurement agreement,
customer databases, and sales backlog, among others, as a result of acquisitions. The company may
incur impairment charges on goodwill or identifiable intangible
assets if it determines that the
fair values of the goodwill or identifiable intangible assets are less than their current carrying
values. The company evaluates, on a regular basis, whether events or circumstances have occurred
that indicate all, or a portion, of the carrying amount of goodwill may no longer be recoverable,
in which case an impairment charge to earnings would become necessary.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of significant declines in macroeconomic conditions, there has been a
decline in global equity valuations since October&nbsp;1, 2008. Both of these factors have impacted the
company&#146;s market capitalization, and the company determined it
was necessary to perform an interim
impairment test of its goodwill and identifiable intangible assets. Based upon the results of such
testing, the company concluded that a portion of its goodwill was impaired and, as such, recognized
a non-cash impairment charge of $1.02&nbsp;billion
($905.1&nbsp;million net of related taxes or $7.49 per
share on both a basic and diluted basis) as of December 31, 2008. The impairment charge did not impact the
company&#146;s consolidated cash flows, liquidity, capital resources,
and covenants
under its existing revolving credit facility, asset securitization program, and other outstanding
borrowings. No impairment existed as of December&nbsp;31, 2008 with
respect to the company&#146;s identifiable intangible assets. See Notes 1 and 3 of the Notes to the Consolidated Financial
Statements and &#145;Critical Accounting Policies&#146; in Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations for further discussion of the impairment testing of goodwill
and identifiable intangible assets.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A continued decline in general economic conditions or global equity valuations, could impact the
judgments and assumptions about the fair value of the company&#146;s
businesses and the company could be required to record
an additional impairment charge in the future, which could impact the company&#146;s consolidated
balance sheet, as well as the company&#146;s consolidated statement of operations. If the company was
required to recognize an additional impairment charge in the future, the charge would not impact
the company&#146;s consolidated cash flows, current liquidity,
capital resources and covenants under its existing revolving credit facility, asset securitization program, and other
outstanding borrowings.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>If the company fails to maintain an effective system of internal controls or discovers material
weaknesses in its internal controls over financial reporting, it may not be able to report its
financial results accurately or timely or detect fraud, which could have a material adverse effect
on its business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">An effective internal control environment is necessary for the company to produce reliable
financial reports and is an important part of its effort to prevent financial fraud. The company
is required to periodically evaluate the effectiveness of the design and operation of its internal
controls over financial reporting. Based on these evaluations, the company may conclude that
enhancements, modifications or changes to internal controls are necessary or desirable. While
management evaluates the effectiveness of the company&#146;s internal controls on a regular basis, these
controls may not always be effective. There are inherent limitations on the effectiveness of
internal controls, including collusion, management
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">override, and failure in human judgment. In addition, control procedures are designed to reduce
rather than eliminate business risks. If the company fails to maintain an effective system of
internal controls, or if management or the company&#146;s independent registered public accounting firm
discovers material weaknesses in the company&#146;s internal controls, it may be unable to produce
reliable financial reports or prevent fraud, which could have a material adverse effect on the
company&#146;s business. In addition, the company may be subject to sanctions or investigation by
regulatory authorities, such as the SEC or the NYSE. Any such actions could result in an adverse
reaction in the financial markets due to a loss of confidence in the reliability of the company&#146;s
financial statements, which could cause the market price of its common stock to decline or limit
the company&#146;s access to capital.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company relies heavily on its internal information systems, which, if not properly functioning,
could materially adversely affect the company&#146;s business.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s current global operations reside on multiple technology platforms. These platforms
are subject to electrical or telecommunications outages, computer hacking, or other general system
failure, which could have a material adverse effect on the company&#146;s business. Because most of the
company&#146;s systems consist of a number of legacy, internally developed applications, it can be
harder to upgrade and may be more difficult to adapt to commercially available software.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is in the process of converting its various business information systems worldwide to a
single Enterprise Resource Planning system. The company has committed significant resources to
this conversion, which started in late 2006 and is expected to be phased in over several years.
This conversion is extremely complex, in part, because of the wide range of processes and the
multiple legacy systems that must be integrated globally. The company will be using a controlled
project plan that it believes will provide for the adequate allocation of resources. However, such
a plan, or a divergence from it, may result in cost overruns, project delays, or business
interruptions. During the conversion process, the company may be limited in its ability to
integrate any business that it may want to acquire. Failure to properly or adequately address
these issues could impact the company&#146;s ability to perform necessary business operations, which
could materially, adversely affect the company&#146;s business.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B><I>The company may be subject to intellectual property rights claims, which are costly to defend,
could require payment of damages or licensing fees and could limit the company&#146;s ability to use
certain technologies in the future.</I></B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Certain of the company&#146;s products include intellectual property owned by the company and/or our
third party suppliers. Substantial litigation and threats of litigation regarding intellectual
property rights exist in the semiconductor/integrated circuit and software industries. From time
to time, third parties (including certain companies in the business of acquiring patents not for
the purpose of developing technology but with the intention of aggressively seeking licensing
revenue from purported infringers) may assert patent, copyright and/or other intellectual property
rights to technologies that are important to the company&#146;s business. In some cases, depending on
the nature of the claim, the company may be able to seek indemnification from its suppliers for
itself and its customers against such claims, but there is no assurance that it will be successful
in obtaining such indemnification or that the company is fully protected against such claims. In
addition, the company is exposed to potential liability for technology that it develops itself for
which we have no indemnification protections. In any dispute involving products that incorporate
intellectual property developed or licensed by the company, the company&#146;s customers could also
become the target of litigation. We are obligated in many instances to indemnify and defend our
customers if the products or services we sell are alleged to infringe any third party&#146;s
intellectual property rights. Any infringement claim brought against the company, regardless of
the duration, outcome or size of damage award, could:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">result in substantial cost to the company;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">divert management&#146;s attention and resources;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">be time consuming to defend;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">result in substantial damage awards;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">cause product shipment delays; or</DIV></TD>
</TR>

</TABLE>
</DIV>
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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 10pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">require the company to seek to enter into royalty or other licensing agreements.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Additionally, if an infringement claim is successful the company may be required to pay damages or
seek royalty or license arrangements, which may not be available on commercially reasonable terms.
The payment of any such damages or royalties may significantly increase our operating expenses and
harm the company&#146;s operating results and financial condition. Also, royalty or license
arrangements may not be available at all. The company may have to stop selling certain products or
using technologies, which could affect the company&#146;s ability to compete effectively.
</DIV>
<DIV align="left">
<A name="104"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;1B. </B><U><B>Unresolved Staff Comments</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">None.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left">
<A name="105"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;2. </B><U><B>Properties</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company owns and leases sales offices, distribution centers, and administrative facilities
worldwide. Its executive office is located in Melville, New York and occupies a 163,000 square
foot facility under a long-term lease expiring in 2013. The company owns 16 locations throughout
North America, EMEASA, and the Asia Pacific region and occupies over 320 additional locations under
leases due to expire on various dates through 2022. The company believes its facilities are well
maintained and suitable for company operations.
</DIV>
<DIV align="left">
<A name="106"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;3. </B><U><B>Legal Proceedings</B></U><B>.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Preference Claim From 2001</B>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, an opinion was rendered in a bankruptcy proceeding (Bridge Information Systems, <I>et. anno</I>
v. Merisel Americas, Inc. &#038; MOCA) in favor of Bridge Information Systems (&#147;Bridge&#148;), the estate of
a former global ECS customer that declared bankruptcy in 2001. The proceeding is related to sales
made in 2000 and early 2001 by the MOCA division of ECS, a company Arrow purchased from Merisel
Americas in the fourth quarter of 2000. The court held that certain of the payments received by
the company at the time were preferential and must be returned to Bridge. Accordingly, during
2008, the company recorded a charge of $10.9&nbsp;million ($6.6&nbsp;million net of related taxes or $.05 per
share on both a basic and diluted basis), in connection with the preference claim from 2001,
including legal fees.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Tekelec Matters</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2000, the company purchased Tekelec Europe SA (&#147;Tekelec&#148;) from Tekelec Airtronic SA
(&#147;Airtronic&#148;) and certain other selling shareholders. Subsequent to the closing of the
acquisition, Tekelec received a product liability claim in the amount of <FONT face="'Times New Roman',times,serif">&#128;</FONT>11.3&nbsp;million. The
product liability claim was the subject of a French legal proceeding started by the claimant in
2002, under which separate determinations were made as to whether the products that are subject to
the claim were defective and the amount of damages sustained by the purchaser. The manufacturer of
the products also participated in this proceeding. The claimant has commenced legal proceedings
against Tekelec and its insurers to recover damages in the amount of <FONT face="'Times New Roman',times,serif">&#128;</FONT>3.7&nbsp;million and expenses of
<FONT face="'Times New Roman',times,serif">&#128;</FONT>.3&nbsp;million plus interest.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Environmental and Related Matters</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Wyle Claims </U>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the 2000 purchase of Wyle from the VEBA Group (&#147;VEBA&#148;), the company assumed
certain of the then outstanding obligations of Wyle, including Wyle&#146;s 1994 indemnification of the
purchasers of its Wyle Laboratories division for environmental clean-up costs associated with any
then existing contamination or violation of environmental regulations. Under the terms of the
company&#146;s purchase of Wyle from VEBA, VEBA agreed to indemnify the company for costs associated
with the Wyle environmental indemnities, among other things. The company is aware of two Wyle
Laboratories facilities (in Huntsville, Alabama and Norco, California) at which contaminated
groundwater was identified. Each site will require remediation, the final form and cost of which
is undetermined. As further discussed in Note 15 of the Notes to Consolidated Financial
Statements, the Alabama site is being investigated by the company under the direction of the
Alabama Department of Environmental Management. The Norco site is subject to a consent decree,
entered in October&nbsp;2003, between the company, Wyle Laboratories, and the California Department of
Toxic Substance Control.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Wyle Laboratories has demanded indemnification from the company with respect to the work at both
sites (and in connection with the litigation discussed below), and the company has, in turn,
demanded indemnification from VEBA. VEBA merged with a publicly&#151;traded, German conglomerate in
June&nbsp;2000. The combined entity, now known as E.ON AG, remains responsible for VEBA&#146;s liabilities. E.ON AG
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">acknowledged liability under the terms of the VEBA contract in connection with the Norco and
Huntsville sites and made an initial, partial payment. Neither the company&#146;s demands for
subsequent payments nor its demand for defense and indemnification in the related litigation and
other costs associated with the Norco site were met.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Related Litigation </U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In October&nbsp;2005, the company filed suit against E.ON AG in the Frankfurt am Main Regional Court in
Germany. The suit seeks indemnification, contribution, and a declaration of the parties&#146;
respective rights and obligations in connection with the Riverside County litigation (discussed
below) and other costs associated with the Norco site. That action is now proceeding.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company was named as a defendant in several suits related to the Norco facility, all of which
were consolidated for pre-trial purposes. In January&nbsp;2005, an action was filed in the California
Superior Court in Riverside County, California (Gloria Austin, <I>et al</I>. v. Wyle Laboratories, Inc. <I>et
al</I>.). Approximately 90 plaintiff landowners and residents sued a number of defendants under a
variety of theories for unquantified damages allegedly caused by environmental contamination at and
around the Norco site. Also filed in the Superior Court in Riverside County were Jimmy Gandara, <I>et
al. </I>v. Wyle Laboratories, Inc. <I>et al. </I>in January&nbsp;2006, and Lisa Briones <I>et al</I>. v. Wyle
Laboratories, Inc. <I>et al</I>. in May&nbsp;2006, both of which contain allegations similar to those in the
Austin case on behalf of approximately 20 additional plaintiffs. The Gandara matter has since been
resolved to the satisfaction of the parties, but the outcome of the Austin and Briones cases and
the amount of any associated liability are unknown.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company was also named as a defendant in a lawsuit filed in September&nbsp;2006 in the United States
District Court for the Central District of California (Apollo Associates, L.P., <I>et anno</I>, v. Arrow
Electronics, Inc. <I>et al.</I>) in connection with alleged contamination at a third site, an industrial
building formerly leased by Wyle Laboratories, in El Segundo, California. The lawsuit was settled,
though the possibility remains that government entities or others may attempt to involve the
company in further characterization or remediation of groundwater issues in the area.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Impact on Financial Statements</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes that any cost which it may incur in connection with environmental conditions
at the Norco, Huntsville, and El Segundo sites and the related litigation is covered by the
contractual indemnifications (except, under the terms of the environmental indemnification, for the
first $.5&nbsp;million), discussed above. The company believes that recovery of costs incurred to date
associated with the environmental clean-up costs related to the Norco and Huntsville sites, is
probable. Accordingly, the company increased the receivable for amounts due from E.ON AG by $8.7
million during 2008 to $33.6&nbsp;million. The company&#146;s net costs for such indemnified matters may
vary from period to period as estimates of recoveries are not always recognized in the same period
as the accrual of estimated expenses. During 2006, the company recorded a charge of $1.4&nbsp;million
($.9&nbsp;million net of related taxes or $.01 per share on both a basic and diluted basis) related to
the environmental matters arising out of the company&#146;s purchase of Wyle.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Also included in the proceedings against E.ON AG is a claim for the reimbursement of
pre-acquisition tax liabilities of Wyle in the amount of $8.7&nbsp;million for which E.ON AG is also
contractually liable to indemnify the company. E.ON AG has specifically acknowledged owing the
company not less than $6.3&nbsp;million of such amounts, but its promises to make payments of at least
that amount were not kept. The company also believes that the recovery of these amounts is
probable.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the acquisition of Wyle, the company acquired a $4.5&nbsp;million tax receivable due
from E.ON AG (as successor to VEBA) in respect of certain tax payments made by Wyle prior to the
effective date of the acquisition, the recovery of which the company also believes is probable.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As successor-in-interest to Wyle, the company is the beneficiary of the various Wyle insurance
policies
that covered liabilities arising out of operations at Norco and Huntsville. Certain of the
carriers of the
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->18<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">primary insurance policies implicated in the pending claims have undertaken
substantial portions of the defense of the company in the Riverside County cases (Austin and
Briones), and the company has recovered approximately $10&nbsp;million from them to date. The company
has sued certain of the umbrella liability policy carriers, however, because they have yet to make
payment on the tendered losses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes strongly in the merits of its positions regarding the E.ON AG indemnity, the
liabilities of the insurance carriers, and the absence of compensable damages to the Riverside
County plaintiffs.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Other</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">From time to time, in the normal course of business, the company may become liable with respect to
other pending and threatened litigation, environmental, regulatory, and tax matters. While such
matters are subject to inherent uncertainties, it is not currently anticipated that any such
matters will materially impact the company&#146;s consolidated financial position, liquidity, or results
of operations.
</DIV>
<DIV align="left">
<A name="107"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;4. </B><U><B>Submission of Matters to a Vote of Security Holders</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">None.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->19<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left">
<A name="108"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>PART II</B>
</DIV>


<DIV align="left">
<A name="109"></A>
</DIV>

<DIV align="left" style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;5.</B></TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify"><U><B>Market for Registrant&#146;s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities</B></U><B>.</B></DIV></TD>
</TR>
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Market Information</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s common stock is listed on the NYSE (trading symbol: &#147;ARW&#148;). The high and low sales
prices during each quarter of 2008 and 2007 were as follows:
</DIV>
<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="2" width="80%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">

<TD nowrap align="left"><FONT style="border-bottom: 1px solid #000000"><B>Year</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="1" style="border-bottom: 1px solid #000000"><B>High</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="1" style="border-bottom: 1px solid #000000"><B>Low</B></TD>

    <TD>&nbsp;</TD>
</TR>
<tr>
    <TD>&nbsp;</TD>
</tr>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2008:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Fourth Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$26.60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$11.74</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Third Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36.00</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24.95</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Second Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34.97</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26.50</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">First Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39.44</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29.00</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2007:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Fourth Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$44.95</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$34.68</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Third Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43.55</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33.17</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Second Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43.13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37.29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">First Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39.83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32.00</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Holders</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On
February&nbsp;20, 2009, there were approximately 2,700 shareholders of record of the company&#146;s common
stock.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Dividend History</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company did not pay cash dividends on its common stock during 2008 or 2007. While the Board of
Directors considers the payment of dividends on the common stock from time to time, the declaration
of future dividends will be dependent upon the company&#146;s earnings, financial condition, and other
relevant factors, including debt covenants.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->20<!-- /Folio -->
</DIV>


<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Equity Compensation Plan Information</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes information, as of December&nbsp;31, 2008, relating to the Omnibus
Incentive Plan, which was approved by the company&#146;s shareholders and under which cash-based awards,
non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock
and restricted stock units, performance shares or units, covered employee annual incentive awards
and other stock-based awards may be granted from time to time.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Weighted</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Securities to be</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Average</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Issued Upon</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Exercise</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Number of</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Exercise</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Price of</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Securities</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>of Outstanding</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Outstanding</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Remaining</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Options,</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Options,</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Available for</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Warrants and</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Warrants and</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Future</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 0px solid #000000"><B>Plan Category</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 0px solid #000000"><B>Rights</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 0px solid #000000"><B>Rights</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 0px solid #000000"><B>Issuance</B></TD>
    <TD>&nbsp;</TD>
</TR>


<TR style="font-size: 1px">
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Equity compensation
plans approved by
security holders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,413,473</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left"></TD>
    <TD align="right">$31.88</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,957,960</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Equity compensation
plans not approved
by security holders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,413,473</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
    <TD align="right">$31.88</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,957,960</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Performance Graph</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following graph compares the performance of the company&#146;s common stock for the periods
indicated with the performance of the Standard &#038; Poor&#146;s 500 Stock Index (&#147;S&#038;P 500 Stock Index&#148;) and
the average performance of a group consisting of the company&#146;s peer companies on a line-of-business
basis. The companies included in the Peer Group are Avnet, Inc., Bell Microproducts, Inc., Jaco
Electronics, Inc., and Nu Horizons Electronics Corp. The graph assumes $100 invested on December
31, 2003 in the company, the S&#038;P 500 Stock Index, and the Peer Group. Total return indices reflect
reinvestment of dividends and are weighted on the basis of market capitalization at the time of
each reported data point.
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><IMG src="y74529y7452902.gif" alt="(PERFORMANCE GRAPH)">
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="28%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2003</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2004</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2005</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2006</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2007</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 0px solid #000000">2008</TD>
</TR>
<tr>
    <TD colspan="13">&nbsp;</TD>
</tr>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Arrow Electronics</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">138</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">136</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">170</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Peer Group</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">85</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">108</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">148</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">89</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">S&#038;P 500 Stock Index</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">111</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">135</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">142</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">90</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->21<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>


<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left">
<A name="110"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;6. </B><U><B>Selected Financial Data</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table sets forth certain selected consolidated financial data and should be read in
conjunction with the company&#146;s consolidated financial statements and related notes appearing
elsewhere in this annual report on Form 10-K (dollars in thousands except per share data):
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left"><B>For the years ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 0px solid #000000"><B>December 31:</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B> (a)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

<TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B> (b)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

<TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B> (c)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2005</B> (d) (f)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

<TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2004</B> (e) (f)</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 6pt" valign="bottom">
    <TD>&nbsp;</TD>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,761,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,164,196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,646,113</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Operating income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(493,569</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">686,905</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">606,225</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">480,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">439,338</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">253,609</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">207,504</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)&nbsp;per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2.15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1.83</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2.09</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1.75</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 3px">
    <TD>&nbsp;</TD>
</tr>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>At December&nbsp;31:</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts receivable and
inventories</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,713,849</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,961,035</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,401,857</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,811,914</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,470,600</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,118,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,059,860</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,669,572</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,044,917</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,509,101</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Long-term debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,223,985</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,223,337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">976,774</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,138,981</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,465,880</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Shareholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,676,698</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,551,860</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,996,559</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,372,886</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,194,186</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 6pt; width: 18%; border-top: 0px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Operating loss and net loss
include a non-cash impairment charge associated with goodwill of
$1.02&nbsp;billion ($905.1&nbsp;million net
of related taxes or $7.49 per share on both a basic and diluted basis), restructuring and
integration charges of $70.1&nbsp;million ($55.3&nbsp;million net of related taxes or $.46 per share on
both a basic and diluted basis), and a charge related to the preference claim from 2001 of
$10.9&nbsp;million ($6.6&nbsp;million net of related taxes or $.05 per share on both a basic or diluted
basis). Net loss also includes a loss of $10.0&nbsp;million ($.08 per
share on both a basic and diluted basis) on the write-down of an
investment, and a reduction of the provision for income taxes of $8.5&nbsp;million
($.07 per share on both a basic and diluted basis) and an increase in interest expense of $1.0
million ($1.0&nbsp;million net of related taxes or $.01 per share on both a basic and diluted
basis) primarily related to the settlement of certain international income tax matters.</DIV></TD>
</TR>
<tr>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(b)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Operating income and net income include restructuring and integration charges of $11.7
million ($7.0&nbsp;million net of related taxes or $.06 per share on both a basic and diluted
basis) and net income includes an income tax benefit of $6.0&nbsp;million, net, ($.05 per share on
both a basic and diluted basis) principally due to a reduction in deferred income taxes as a
result of the statutory tax rate change in Germany.</DIV></TD>
</TR>

<tr>
    <TD style="font-size: 6pt">&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(c)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Operating income and net income include restructuring and integration charges of $11.8
million ($9.0&nbsp;million net of related taxes or $.07 per share on both a basic and diluted
basis), a charge related to a pre-acquisition warranty claim of $2.8&nbsp;million ($1.9&nbsp;million net
of related taxes or $.02 per share on both a basic and diluted basis), and a charge related to
pre-acquisition environmental matters arising out of the company&#146;s purchase of Wyle of $1.4
million ($.9&nbsp;million net of related taxes or $.01 per share on both a basic and diluted
basis). Net income also includes a loss on prepayment of debt of $2.6&nbsp;million ($1.6&nbsp;million
net of related taxes or $.01 per share on both a basic and diluted basis) and the reduction of
the provision for income taxes of $46.2&nbsp;million ($.38 per share on both a basic and diluted
basis) and the reduction of interest expense of $6.9&nbsp;million ($4.2&nbsp;million net of related
taxes or $.03 per share on both a basic and diluted basis) related to the settlement of
certain income tax matters.</DIV></TD>
</TR>

<tr>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(d)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Operating income and net income include restructuring and integration charges of $12.7
million ($7.3&nbsp;million net of related taxes or $.06 and $.05 per share on a basic and diluted
basis, respectively) and an acquisition indemnification credit of $1.7&nbsp;million ($1.3&nbsp;million net of
related</DIV></TD>
</TR>

</TABLE>


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<DIV style="font-family: Helvetica,Arial,sans-serif">



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">taxes or $.01 per share on a basic basis). Net income also includes a loss on
prepayment of debt of $4.3&nbsp;million ($2.6&nbsp;million net of related taxes or $.02 and $.01 per
share on a basic and diluted basis, respectively) and a loss of $3.0&nbsp;million ($.03 per share
on both a basic and diluted basis) on the write-down of an investment.</DIV></TD>
</TR>
<tr>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(e)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Operating income and net income include restructuring and integration charges of $9.1&nbsp;million
($5.6&nbsp;million net of related taxes or $.06 and $.05 per share on a basic and diluted basis,
respectively), an acquisition indemnification credit, due to a change in estimate, of $9.7
million ($.09 and $.08 per share on a basic and diluted basis, respectively), and an
impairment charge of $10.0&nbsp;million ($.09 and $.08 per share on a basic and diluted basis,
respectively). Net income also includes a loss on prepayment of debt of $33.9&nbsp;million ($20.3
million net of related taxes or $.18 and $.16 per share on a basic and diluted basis,
respectively) and a loss of $1.3&nbsp;million ($.01 per share on both a basic and diluted basis) on
the write-down of an investment.</DIV></TD>
</TR>
<tr>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(f)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Effective January&nbsp;1, 2006, the company adopted the provisions of Financial Accounting
Standards Board (&#147;FASB&#148;) Statement No.&nbsp;123 (revised 2004), &#147;Share-Based Payment&#148; and the
Securities and Exchange Commission Staff Accounting Bulletin No.&nbsp;107, which requires
share-based payment (&#147;SBP&#148;) awards exchanged for employee services to be measured at fair
value and expensed in the consolidated statements of operations over the requisite employee
service period. Prior to January&nbsp;1, 2006, the company accounted for SBP awards under
Accounting Principles Board Opinion No.&nbsp;25, &#147;Accounting for Stock Issued to Employees,&#148; which
utilized the intrinsic value method and did not require any expense to be recorded in the
consolidated financial statements if the exercise price of the award was not less than the
market price of the underlying stock on the date of grant. Had compensation expense been
determined in accordance with the fair value method of accounting at the grant dates for
awards under the company&#146;s various stock-based compensation plans, operating income and net
income would be reduced by $15.2&nbsp;million and $9.1&nbsp;million ($.08 and $.07 per share on a basic
and diluted basis, respectively) for 2005, and $18.5&nbsp;million and $11.1&nbsp;million ($.10 and $.09
per share on a basic and diluted basis, respectively) for 2004.</DIV></TD>
</TR>

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<DIV style="font-family: Helvetica,Arial,sans-serif">





<DIV align="left">
<A name="111"></A>
</DIV>

<DIV align="left" style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;7.</B></TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify"><U><B>Management&#146;s Discussion and Analysis of Financial Condition and Results of
Operations</B></U><B>.</B></DIV></TD>
</TR>
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Overview</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is a global provider of products, services, and solutions to industrial and commercial
users of electronic components and enterprise computing solutions. The company provides one of the
broadest product offerings in the electronics distribution industry and a wide range of value-added
services to help customers reduce time to market, lower their total cost of ownership, and enhance
their overall competitiveness. The company distributes electronic components to OEMs and CMs
through its global components business segment and provides enterprise computing solutions to VARs
through its global ECS business segment. For 2008, approximately 68% of the company&#146;s sales were
from the global components business segment, and approximately 32% of the company&#146;s sales were from
the global ECS business segment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Operating efficiency and working capital management remain a key focus of the company&#146;s business
initiatives to grow sales faster than the market, grow profits faster than sales, and increase
return on invested capital. To achieve its financial objectives, the company seeks to capture
significant opportunities to grow across products, markets, and geographies. To supplement its
organic growth strategy, the company continually evaluates strategic acquisitions to broaden its
product offerings, increase its market penetration, and/or expand its geographic reach.
Investments needed to fund this growth are developed through continuous corporate-wide initiatives
to improve profitability and increase effective asset utilization.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On June&nbsp;2, 2008, the company acquired LOGIX, a subsidiary of Groupe OPEN for a purchase price of
$205.9&nbsp;million, which included $15.5&nbsp;million of debt paid at closing, cash acquired of $3.6
million, and acquisition costs. In addition, there was the assumption of $46.7&nbsp;million in debt.
Headquartered in France, LOGIX has approximately 500 employees and is a leading value-added
distributor of midrange servers, storage, and software to over 6,500 partners in 11 European
countries. Total LOGIX sales for 2007 were approximately $600&nbsp;million (approximately <FONT face="'Times New Roman',times,serif">&#128;</FONT>440
million). For 2008, LOGIX sales of $376.9&nbsp;million were included in the company&#146;s consolidated
results of operations from the date of acquisition.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On March&nbsp;31, 2007, the company acquired from Agilysys substantially all of the assets and
operations of KeyLink for a purchase price of $480.6&nbsp;million in cash, which included acquisition
costs and final adjustments based upon a closing audit. The company also entered into a long-term
procurement agreement with Agilysys. Total KeyLink sales for 2006, including estimated revenues
associated with the above-mentioned procurement agreement, were approximately $1.6&nbsp;billion.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Consolidated sales for 2008 grew by 4.9%, compared with the year-earlier period, due to a 14.3%
increase in the global ECS business segment sales and a less than 1% increase in the global
components business segment sales. On a pro forma basis, adjusted for acquisitions, consolidated
sales increased less than 1%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The increase in global ECS business segment sales of 14.3% for 2008 was primarily due to the
KeyLink and LOGIX acquisitions. On a pro forma basis, which includes KeyLink and LOGIX as though
these acquisitions occurred on January&nbsp;1, 2007 and excluding KeyLink sales from the related
long-term procurement agreement with Agilysys for the first quarter of 2008, the global ECS
business segment sales for 2008 decreased by less than 1% when compared with the year-earlier
period. This decrease was primarily due to weakness in sales of servers offset, in part, by the
impact of a weaker U.S. dollar on the translation of the company&#146;s international financial
statements, and growth in storage, software, and services. Excluding the impact of foreign
currency, the company&#146;s global ECS business segment sales increased by 13.3% in 2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the global components business segment, sales for 2008 increased primarily due to strength in
the Asia Pacific region and the impact of a weaker U.S. dollar on the translation of the company&#146;s
international financial statements, offset, in part, by weakness in North America and Europe.
Excluding
the impact of foreign currency, the company&#146;s global components business segment sales decreased by
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">1.3% in 2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
company recorded a net loss of $613.7&nbsp;million in 2008,
principally due to a non-cash impairment charge of $1.02&nbsp;billion
associated with goodwill as a result of significant declines in
macroeconomic conditions and related declines in global equity
valuations, compared with net income of $407.8
million in 2007. The following items impacted the comparability of the company&#146;s results for the
years ended December&nbsp;31, 2008 and 2007:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">a non-cash impairment charge
associated with goodwill of $1.02&nbsp;billion ($905.1&nbsp;million net of related taxes) in 2008;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">restructuring and integration charges of $70.1&nbsp;million ($55.3&nbsp;million net of related
taxes) in 2008 and $11.7&nbsp;million ($7.0&nbsp;million net of related taxes) in 2007;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">a charge related to the preference claim from 2001 of $10.9&nbsp;million ($6.6&nbsp;million net of
related taxes) in 2008;</DIV></TD>
</TR>


<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">a loss of $10.0&nbsp;million
on the write-down of an investment in 2008;</DIV></TD>
</TR>





<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">a reduction of the provision for income taxes of $8.5&nbsp;million and an increase in
interest expense of $1.0&nbsp;million ($1.0&nbsp;million net of related taxes) primarily related to
the settlement of certain international income tax matters in 2008; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">an income tax benefit of $6.0&nbsp;million, net, principally due to a reduction in deferred
income taxes as a result of the statutory tax rate change in Germany in 2007.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Excluding the above-mentioned items, the decrease in net income in 2008 was primarily the result of
the sales decline in the more profitable components businesses in North America and Europe and
increased expenditures related to the company&#146;s global enterprise resource planning (&#147;ERP&#148;)
initiative offset, in part, by increased sales in the global ECS business segment and the global
components businesses in the Asia Pacific region and by a lower effective tax rate.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Substantially all of the company&#146;s sales are made on an order-by-order basis, rather than through
long-term sales contracts. As such, the nature of the company&#146;s business does not provide for the
visibility of material forward-looking information from its customers and suppliers beyond a few
months of forecast information.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Sales</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Consolidated sales for 2008 increased by $776.0&nbsp;million, or 4.9%, compared with the year-earlier
period. The increase was driven by an increase in the global ECS business segment of $680.3
million, or 14.3%, and an increase in the global components business segment of $95.7&nbsp;million, or
less than 1%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the global ECS business segment, sales for 2008 increased by 14.3%, compared with the
year-earlier period, primarily due to the KeyLink and LOGIX acquisitions. On a pro forma basis,
which includes KeyLink and LOGIX as though these acquisitions occurred on January&nbsp;1, 2007 and
excluding KeyLink sales from the related long-term procurement agreement with Agilysys for the
first quarter of 2008, the global ECS business segment sales for 2008 decreased by less than 1%,
compared with the year-earlier period. This decrease was primarily due to weakness of servers
offset, in part, by the impact of a weaker U.S. dollar on the translation of the company&#146;s
international financial statements and growth in storage, software, and services.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the global components business segment, sales for 2008 increased by less than 1% compared with
the year-earlier period, primarily due to strength in the Asia Pacific region and the impact of a
weaker U.S. dollar on the translation of the company&#146;s international financial statements, offset,
in part, by weakness in North America and Europe.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The translation of the company&#146;s international financial statements into U.S. dollars resulted in
increased sales of $293.4&nbsp;million for 2008, compared with the year-earlier period, due to a weaker
U.S. dollar. Excluding the impact of foreign currency, the company&#146;s consolidated sales increased
by 3.0% in 2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Consolidated sales for 2007 increased by $2.41&nbsp;billion, or 17.7%, compared with the year-earlier
period. The increase was driven by an increase in the global ECS business segment of $2.27
billion, or 91.2%,
and an increase in the global components business segment of $137.4&nbsp;million, or 1.2%, compared with
the year-earlier period.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the global ECS business segment, sales for 2007 increased by 91.2%, compared with the
year-earlier period, primarily due to the acquisitions of Alternative Technology, InTechnology, and
KeyLink. On a pro forma basis, which includes Alternative Technology, InTechnology, and KeyLink as
though these acquisitions occurred on January&nbsp;1, 2006, the global ECS business segment sales for
2007 grew by 17.8%, compared with the year-earlier period. This was primarily due to the growth in
storage, software, and industry standard servers and due to the company&#146;s increased focus on
sales-related initiatives.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In the global components business segment, sales for 2007 increased by 1.2% compared with the
year-earlier period, primarily due to the company&#146;s increased focus on sales-related initiatives
and the impact of a weaker U.S. dollar on the translation of the company&#146;s international financial
statements. The increase was offset, in part, by continued weakness at large EMS customers and the
company&#146;s initiative to exit lower-margin business in the Asia Pacific region.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The translation of the company&#146;s international financial statements into U.S. dollars resulted in
increased sales of $394.7&nbsp;million for 2007, compared with the year-earlier period, due to a weaker
U.S. dollar. Excluding the impact of foreign currency, the company&#146;s consolidated sales increased
by 14.8% in 2007.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Gross Profit</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded gross profit of $2.28&nbsp;billion and $2.29&nbsp;billion for 2008 and 2007,
respectively. The gross profit margin for 2008 decreased by approximately 70 basis points when
compared with the year-earlier period. The decrease was due, in part, to the KeyLink and LOGIX
acquisitions, which are both lower gross profit margin businesses. On a pro forma basis, which
includes KeyLink and LOGIX as though these acquisitions occurred on January&nbsp;1, 2007, the gross
profit margin for 2008 decreased by approximately 60 basis points when compared with the
year-earlier period. This was primarily due to a change in the mix in the company&#146;s business, with
the global ECS business segment and Asia Pacific region being a greater percentage of total sales.
The profit margins of products in the global ECS business segment are typically lower than the
profit margins of the products in the global components business segment, and the profit margins of
the components sold in the Asia Pacific region tend to be lower than the profit margins in North
America and Europe. The financial impact of the lower gross profit was offset, in part, by the
lower operating costs and lower working capital requirements in these businesses relative to the
company&#146;s other businesses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded gross profit of $2.29&nbsp;billion and $2.03&nbsp;billion for 2007 and 2006,
respectively. The gross profit margin for 2007 decreased by approximately 70 basis points when
compared with the year-earlier period. The decrease in gross profit margin was principally due to
the acquisitions of Alternative Technology, InTechnology, and KeyLink, which are lower gross profit
margin businesses. On a pro forma basis, which includes the impact of these acquisitions, the
gross profit margin for 2007 decreased by approximately 20 basis points when compared with the
year-earlier period, primarily due to a change in the mix in the company&#146;s business, with the
global ECS business segment and Asia/Pacific being a greater percentage of total sales.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Other Charges</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Impairment Charge</U>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company tests goodwill for impairment annually as of the first day of the fourth quarter,
or more frequently if indicators of potential impairment exist. As a result of significant declines in macroeconomic conditions, there has
been a decline in global equity valuations since October&nbsp;1, 2008. Both of these
factors have impacted the company&#146;s market capitalization, and the company determined it was
necessary to perform an interim impairment test of its goodwill and identifiable intangible assets. Based
upon the results of such testing, the company concluded that a portion of its goodwill was impaired
and, as such, recognized a non-cash impairment charge of
$1.02&nbsp;billion ($905.1&nbsp;million net of
related taxes or $7.49 per share on both a basic and diluted basis)
as of December 31, 2008,
of which $716.9&nbsp;million
related to the company&#146;s global components business segment and $301.9
million related to the company&#146;s global ECS business segment.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The impairment charge did
not impact the company&#146;s consolidated cash flows, liquidity,
capital resources and covenants under its existing revolving credit facility, asset securitization program, and
other outstanding borrowings. No impairment existed as of December 31,
2008 with respect to the company&#146;s identifiable intangible
assets.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2008 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, the company recorded a restructuring and integration charge of $70.1&nbsp;million ($55.3
million net of related taxes or $.46 per share on both a basic and diluted basis). Included in the
restructuring and integration charge for 2008 is a restructuring charge of $69.8&nbsp;million related to
initiatives by the company to improve operating efficiencies. These actions are expected to reduce
costs by approximately $57&nbsp;million per annum, with approximately $17&nbsp;million realized in 2008. Also
included in the restructuring and integration charge for 2008 is a restructuring credit of $.3
million related to adjustments to reserves previously established through restructuring charges in
prior periods and an integration charge of $.6&nbsp;million, primarily related to the ACI and KeyLink
acquisitions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $69.8&nbsp;million in 2008 primarily includes personnel costs of $39.4
million, facility costs of $4.3&nbsp;million, and a write-down of a building and related land of $25.4
million. These initiatives are the result of the company&#146;s continued efforts to lower cost and
drive operational efficiency. The personnel costs are primarily associated with the elimination of
approximately 750 positions across multiple functions and multiple locations. The facilities costs
are related to the exit activities of 9 vacated facilities in North America and Europe. During the
fourth quarter of 2008, the company&#146;s management approved a plan to actively market and sell a
building and related land in North America within the company&#146;s global components business segment
acquired in 2000 in connection with the acquisition of Wyle. The decision to exit this location
was made to enable the company to consolidate facilities and reduce future operating costs. The
sale is expected to be completed within the next twelve months. As a result of this action, the
asset was designated as an asset held for sale in accordance with FASB Statement No.&nbsp;144,
&#147;Accounting for the Impairment or Disposal of Long-Lived Assets,&#148; and is included in &#147;Prepaid
expenses and other assets&#148; on the company&#146;s consolidated balance sheet as of December&nbsp;31, 2008.
Upon the designation, the carrying values of the building and related land were recorded at the
lower of their carrying values or their estimated fair values less cost to sell, and the company
ceased recording depreciation. The company wrote-down the carrying values of the building and
related land by $25.4&nbsp;million to $9.5&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2007 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2007, the company recorded a restructuring and integration charge of $11.7&nbsp;million ($7.0&nbsp;million
net of related taxes or $.06 per share on both a basic and diluted basis). Included in the
restructuring and integration charge for 2007 is $9.7&nbsp;million related to initiatives by the company
to improve operating efficiencies, resulting in expected cost savings of approximately $40&nbsp;million
per annum. Also included in the restructuring and integration charge for 2007 is a restructuring
credit of $.4&nbsp;million primarily related to the reversal of excess reserves, which were previously
established through restructuring charges in prior periods, a gain on the sale of the Lenexa,
Kansas facility of $.5&nbsp;million that was vacated in 2007 due to the company&#146;s continued efforts to
reduce real estate costs, and an integration charge of $2.9&nbsp;million primarily related to the
acquisition of KeyLink.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $9.7&nbsp;million in 2007 primarily includes personnel costs of $11.3
million related to the elimination of approximately 400 positions. These positions were primarily
within the company&#146;s global components business segment in North America and related to the
company&#146;s continued focus on operational efficiency. Facilities include a restructuring credit of
$1.9&nbsp;million, primarily related to a gain on the sale of the Harlow, England facility of $8.5
million that was vacated in 2007. This was offset by facilities costs of $6.6&nbsp;million, primarily
related to exit activities for a vacated facility in Europe due to the company&#146;s continued efforts
to reduce real estate costs.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Integration costs of $3.7&nbsp;million in 2007 include $2.9&nbsp;million recorded as an integration charge
and $.8
million recorded as additional costs in excess of net assets of companies acquired. The
integration costs
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">include personnel costs of $1.7&nbsp;million associated with the elimination of
approximately 50 positions in North America related to the acquisition of KeyLink, a credit of $.5
million primarily related to the reversal of excess facility-related accruals in connection with
certain acquisitions made prior to 2005 and other costs of $2.6&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2006 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2006, the company recorded a restructuring and integration charge of $11.8&nbsp;million ($9.0&nbsp;million
net of related taxes or $.07 per share on both a basic and diluted basis). Included in the
restructuring and integration charge for 2006 is a restructuring charge of $12.3&nbsp;million related to
initiatives by the company to improve operating efficiencies, resulting in expected cost savings of
approximately $9&nbsp;million per annum. Also included in the restructuring and integration charge for
2006 is a restructuring credit of $.5&nbsp;million primarily related to the reversal of excess reserves,
which were previously established through restructuring charges in prior periods.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $12.3&nbsp;million in 2006 includes personnel costs of $6.5&nbsp;million related
to the elimination of approximately 300 positions. These positions were primarily within the
company&#146;s global components business segment in North America and related to the outsourcing of
certain administrative functions and the closure of a warehouse facility. Facilities costs of $1.2
million were incurred related to exit activities of three vacated facilities in Europe due to the
company&#146;s continued efforts to reduce real estate costs. Also included in the restructuring charge
is a charge related to the write-down of certain capitalized software in Europe of $4.5&nbsp;million.
This write-down resulted from the company&#146;s decision in the fourth quarter of 2006 to implement a
global ERP system, which caused these software costs to become redundant and have no future
benefit.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Preference Claim From 2001</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, an opinion was rendered in a bankruptcy proceeding (Bridge Information Systems, <I>et. anno</I>
v. Merisel Americas, Inc. &#038; MOCA) in favor of Bridge Information Systems (&#147;Bridge&#148;), the estate of
a former global ECS customer that declared bankruptcy in 2001. The proceeding is related to sales
made in 2000 and early 2001 by the MOCA division of ECS, a company Arrow purchased from Merisel
Americas in the fourth quarter of 2000. The court held that certain of the payments received by
the company at the time were preferential and must be returned to Bridge. Accordingly, during
2008, the company recorded a charge of $10.9&nbsp;million ($6.6&nbsp;million net of related taxes or $.05
per share on both a basic and diluted basis), in connection with the preference claim from 2001,
including legal fees.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Pre-Acquisition Warranty Claim</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company recorded a charge of $2.8&nbsp;million ($1.9&nbsp;million net of related taxes or
$.02 per share on both a basic and diluted basis) related to a pre-acquisition warranty claim.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Pre-Acquisition Environmental Matters</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As discussed in Note 15 of the Notes to Consolidated Financial Statements, in connection with the
2000 purchase of Wyle from VEBA, the company assumed certain of the then outstanding obligations of
Wyle, including Wyle&#146;s 1994 indemnification of the purchasers of its Wyle Laboratories division,
for environmental clean-up costs associated with any then existing contamination or violation of
environmental regulations. Under the terms of the company&#146;s purchase of Wyle from VEBA, VEBA agreed
to indemnify the company for costs associated with the Wyle environmental indemnities, among other
things. VEBA has since merged with E.ON AG, a German-based, multinational conglomerate. The
company&#146;s net costs for such indemnified matters may vary from period to period as estimates of
recoveries are not always recognized in the same period as the accrual of estimated expenses.
During 2006, the company recorded a charge of $1.4&nbsp;million ($.9&nbsp;million net of related taxes or
$.01 per share on both a basic and diluted basis) related to the environmental matters arising out
of the company&#146;s purchase of Wyle.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Operating Income (Loss)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
company recorded an operating loss of $493.6&nbsp;million in 2008 as compared with operating income
of $686.9&nbsp;million in 2007. Included in the operating loss for 2008 was the previously discussed
impairment charge associated with goodwill of $1.02&nbsp;billion,
restructuring and integration charges of $70.1&nbsp;million, and a
charge related to the preference claim from 2001 of $10.9&nbsp;million. Included in operating income
for 2007 was the previously discussed restructuring and integration charges of $11.7&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Selling, general and administrative expenses increased $87.4&nbsp;million, or 5.7%, in 2008, as compared
with 2007, on a sales increase of 4.9%. The dollar increase in selling, general and administrative
expenses compared with the year-earlier period, was due to the impact of foreign exchange rates,
selling, general and administrative expenses incurred by acquired companies and increased
expenditures related to the company&#146;s global ERP initiative. Selling, general and administrative
expenses, as a percentage of sales, were 9.6% and 9.5% for 2008 and 2007, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Depreciation and amortization increased by $2.6&nbsp;million, or 3.8%, in 2008, compared with the
year-earlier period, primarily due to acquisitions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded operating income of $686.9&nbsp;million in 2007 as compared with operating income
of $606.2&nbsp;million in 2006. Included in operating income for 2007 was the previously discussed
restructuring and integration charges of $11.7&nbsp;million. Included in operating income for 2006 were
the previously discussed restructuring and integration charges of $11.8&nbsp;million, pre-acquisition
warranty claim of $2.8&nbsp;million, and pre-acquisition environmental matters of $1.4&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Selling, general and administrative expenses increased by $157.8&nbsp;million, or 11.6%, in 2007, as
compared with 2006, on a sales increase of 17.7%. The dollar increase in selling, general and
administrative expenses compared with the year-earlier period, was primarily due to selling,
general and administrative expenses incurred by Alternative Technology, InTechnology, and KeyLink,
higher selling expenses to support increased sales, and the impact of foreign exchange rates.
Selling, general and administrative expenses, as a percentage of sales, was 9.5% and 10.0% for 2007
and 2006, respectively. The decrease in selling, general and administrative expenses, as a
percentage of sales, compared with the year-earlier period, was primarily the result of the
acquisitions of Alternative Technology, InTechnology, and KeyLink, which have lower selling,
general and administrative expenses as a percentage of sales, and the company&#146;s ability to more
effectively leverage its existing cost structure to support a higher level of sales.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Depreciation and amortization increased by $19.8&nbsp;million, or 42.2%, in 2007, compared with the
year-earlier period, primarily due to acquisitions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Loss on Prepayment of Debt</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company redeemed the total amount outstanding of $283.2&nbsp;million principal amount
($156.4&nbsp;million accreted value) of its zero coupon convertible debentures due in 2021 (&#147;convertible
debentures&#148;) and repurchased $4.1&nbsp;million principal amount of its 7% senior notes due in January
2007. The related loss on the redemption and repurchase, including any related premium paid,
write-off of deferred financing costs, and cost of terminating a portion of the related interest
rate swaps, aggregated $2.6&nbsp;million ($1.6&nbsp;million net of related taxes or $.01 per share on both a
basic and diluted basis) and was recognized as a loss on prepayment of debt. As a result of these
transactions, net interest expense was reduced by approximately $2.6&nbsp;million from the dates of
redemption and repurchase through the respective maturity dates, based on interest rates in effect
at the time of the redemption and repurchase.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Loss
on the Write-Down of an Investment</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During
the fourth quarter of 2008, the company determined that an
other-than-temporary decline in the fair value of its investment in
Marubun Corporation had occurred and, accordingly, recognized a loss
of $10.0&nbsp;million ($.08 per share on both a basic and diluted
basis) on the write-down of this investment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Interest Expense</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Net interest expense decreased by 1.7% in 2008 to $99.9&nbsp;million, compared with $101.6&nbsp;million in
2007,
primarily due to lower interest rates on the company&#146;s variable rate debt offset, in part, by an
increase in interest expense of $1.0&nbsp;million primarily related to the settlement of certain
international income tax
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">matters (discussed in &#147;Income Taxes&#148; below).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Net interest expense increased by 12.2% in 2007 to $101.6&nbsp;million, compared with $90.6&nbsp;million in
2006. The increase was primarily due to the settlement of certain tax matters in 2006 (discussed
in &#147;Income Taxes&#148; below), which resulted in a reduction of related interest expense of $6.9
million. In addition, the company had higher average debt outstanding, primarily due to
acquisitions, and higher variable interest rates in 2007, compared with the year-earlier period.
Interest income decreased $2.1&nbsp;million in 2007, compared with the year-earlier period, primary due
to the use of interest-bearing cash to fund acquisitions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Income Taxes</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded a provision for income taxes of $16.7&nbsp;million (an effective tax rate of
(2.8%)) for 2008. During the fourth quarter of 2008, the company recorded a reduction of the provision for income taxes
of $8.5&nbsp;million ($.07 per share on both a basic and diluted basis) primarily related to the
settlement of certain international tax matters covering multiple tax years. The company&#146;s
provision for income taxes and effective tax rate for 2008 were impacted by the previously
discussed settlement of certain international income tax matters,
impairment charge associated with goodwill, restructuring
and integration charges, preference claim from 2001, and a loss on
the write-down of an investment. Excluding the impact of the previously
discussed settlement of certain international income tax matters,
impairment charge associated with goodwill, restructuring
and integration charges, preference claim from 2001, and a loss on the
write-down of an investment, the company&#146;s effective tax rate was 30.7%
for 2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded a provision for income taxes of $180.7&nbsp;million (an effective tax rate of
30.5%) for 2007. During 2007, the company recorded an income tax benefit of $6.0&nbsp;million, net,
($.05 per share on both a basic and diluted basis) principally due to a reduction in deferred
income taxes as a result of the statutory tax rate change in Germany. These deferred income taxes
primarily related to the amortization of intangible assets for income tax purposes, which are not
amortized for accounting purposes. The company&#146;s provision for income taxes and effective tax rate
for 2007 were impacted by the aforementioned income tax benefit and the previously discussed
restructuring and integration charges. Excluding the impact of the aforementioned income tax
benefit and restructuring and integration charges, the company&#146;s effective tax rate was 31.7% for
2007.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded a provision for income taxes of $128.5&nbsp;million (an effective tax rate of
24.8%) for 2006. During 2006, the company settled certain income tax matters covering multiple
years. As a result of the settlement of the tax matters, the company recorded a reduction of the
provision for income taxes of $46.2&nbsp;million ($.38 per share on both a basic and diluted basis), of
which $40.4&nbsp;million ($.33 per share on both a basic and diluted basis) related to tax years prior
to 2006. The company&#146;s provision for income taxes and effective tax rate were impacted by the
previously discussed settlement of certain income tax matters, restructuring and integration
charges, pre-acquisition warranty claim, and pre-acquisition environmental matters. Excluding the
impact related to tax years prior to 2006 of the previously discussed settlement of certain income
tax matters, restructuring and integration charges, pre-acquisition warranty claim, and
pre-acquisition environmental matters, the company&#146;s effective tax rate was 32.4% for 2006.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s provision for income taxes and effective tax rate are impacted by, among other
factors, the statutory tax rates in the countries in which it operates and the related level of
income generated by these operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Net Income (Loss)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
company recorded a net loss of $613.7&nbsp;million for 2008, compared with net income of $407.8
million in the year-earlier period. Included in the net loss for 2008 was the previously discussed
impairment charge associated with goodwill of $905.1&nbsp;million, restructuring and integration charges of $55.3&nbsp;million,
preference claim from
2001 of $6.6&nbsp;million, a loss on the write-down of an investment
of $10.0&nbsp;million and a reduction of the provision for income taxes of $8.5&nbsp;million and an
increase in interest expense, net of related taxes, of $1.0&nbsp;million related to the settlement of
certain international income tax matters. Included in net income for 2007 was the previously
discussed restructuring and
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">integration charges of $7.0&nbsp;million and income tax benefit of $6.0
million, net, principally due to a reduction in deferred income tax as a result of the statutory
tax rate change in Germany. Excluding the above-mentioned items, the decrease in net income in
2008 was primarily the result of the sales decline in the more profitable components businesses in
North America and Europe and increased expenditures related to the company&#146;s global ERP initiative
offset, in part, by increased sales in the global ECS business segment and the global components
businesses in the Asia Pacific region and by a lower effective tax rate.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded net income of $407.8&nbsp;million for 2007, compared with $388.3&nbsp;million in the
year-earlier period. Included in net income for 2007 were the previously discussed restructuring
and integration charges of $7.0&nbsp;million and income tax benefit of $6.0&nbsp;million, net, principally
due to a reduction in deferred income taxes as a result of the statutory tax rate change in
Germany. Included in net income for 2006 were the previously discussed restructuring and
integration charges of $9.0&nbsp;million, a charge related to a pre-acquisition warranty claim of $1.9
million, a charge related to pre-acquisition environmental matters arising out of the company&#146;s
purchase of Wyle of $.9&nbsp;million, a loss on prepayment of debt of $1.6&nbsp;million, and the reduction of
the provision for income taxes of $46.2&nbsp;million and the reduction of interest expense, net of
related taxes, of $4.2&nbsp;million related to the settlement of certain income tax matters totaling
$50.4&nbsp;million. Excluding the above-mentioned items, the increase in net income for 2007 was due to
increased gross profit on higher sales, offset, in part, by increased selling, general and
administrative expenses to support the increase in sales, higher depreciation and amortization
expense primarily related to acquisitions, and a higher effective tax rate.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Liquidity and Capital Resources</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">At December&nbsp;31, 2008 and 2007, the company had cash and cash equivalents of $451.3&nbsp;million and
$447.7&nbsp;million, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2008, the net amount of cash provided by the company&#146;s operating activities was $619.8
million, the net amount of cash used for investing activities was $492.7&nbsp;million, and the net
amount of cash used for financing activities was $111.1&nbsp;million. The effect of exchange rate
changes on cash was a decrease of $12.5&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2007, the net amount of cash provided by the company&#146;s operating activities was $850.7
million, the net amount of cash used for investing activities was $665.5&nbsp;million, and the net
amount of cash used for financing activities was $82.2&nbsp;million. The effect of exchange rate changes
on cash was an increase of $7.0&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the net amount of cash provided by the company&#146;s operating activities was $120.8
million, the net amount of cash used for investing activities was $238.7&nbsp;million, and the net
amount of cash used for financing activities was $132.7&nbsp;million. The effect of exchange rate
changes on cash was an increase of $7.6&nbsp;million.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Cash Flows from Operating Activities</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains a significant investment in accounts receivable and inventories. As a
percentage of total assets, accounts receivable and inventories were
approximately 66.2% and 61.6%
at December&nbsp;31, 2008 and 2007, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash provided by the company&#146;s operating activities during 2008 was $619.8
million and was primarily due to earnings from operations, adjusted for non-cash items, and a
reduction in accounts receivable and inventory offset, in part, by a decrease in accounts payable.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash provided by the company&#146;s operating activities during 2007 was $850.7
million and
was primarily due to earnings from operations, adjusted for non-cash items, a reduction in
inventory, and an increase in accounts payable and accrued expenses. This was offset, in part, by
an increase in accounts receivable supporting increased sales.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash provided by the company&#146;s operating activities during 2006 was $120.8
million and was primarily due to earnings from operations, adjusted for non-cash items, offset, in
part, by increased inventory purchases, and increased accounts receivable that supported increased
sales in the global components businesses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Working capital, as a percentage of sales, was 13.4%, 15.2%, and 19.2% in 2008, 2007, and 2006,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Cash Flows from Investing Activities</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for investing activities during 2008 was $492.7&nbsp;million, primarily
reflecting $333.5&nbsp;million of cash consideration paid for acquired businesses and $158.7&nbsp;million for
capital expenditures, which includes $113.4&nbsp;million of capital expenditures related to the
company&#146;s global ERP initiative.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2008, the company acquired Hynetic, a franchise components distribution business in India,
ACI, a distributor of electronic components used in defense and aerospace applications, LOGIX, a
leading value-added distributor of midrange servers, storage, and software, Achieva, a value-added
distributor of semiconductors and electro-mechanical devices, Excel Tech, the sole Broadcom
distributor in Korea, and Eteq Components, a Broadcom-based franchise components distribution
business in the ASEAN region and China, for aggregate cash consideration of $319.9&nbsp;million. In
addition, the company made payments of $13.6&nbsp;million to increase its ownership interest in
majority-owned subsidiaries.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for investing activities during 2007 was $665.5&nbsp;million, primarily
reflecting $539.6&nbsp;million of cash consideration paid for acquired businesses and $138.8&nbsp;million for
capital expenditures, which includes $73.1&nbsp;million of capital expenditures related to the company&#146;s
global ERP initiative. This was offset, in part, by $13.0&nbsp;million of cash proceeds, primarily
related to the sale of the company&#146;s Lenexa, Kansas and Harlow, England facilities.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2007, the company acquired KeyLink, a leading enterprise computing solutions distributor in
North America, Adilam, a leading electronic components distributor in Australia and New Zealand,
Centia/AKS, specialty distributors of access infrastructure, security, and virtualization software
solutions in Europe, and UEC, a distributor of semiconductor and multimedia products in Japan, for
aggregate cash consideration of $506.9&nbsp;million. In addition, the company made a payment of $32.7
million to increase its ownership interest in Ultra Source from 70.7% to 92.8%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for investing activities during 2006 was $238.7&nbsp;million, primarily
reflecting $176.2&nbsp;million for cash consideration paid for acquired businesses and $66.1&nbsp;million for
capital expenditures.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company acquired InTechnology, a distributor of storage and security solutions to
VARs based in the United Kingdom, Alternative Technology, a leading specialty distributor of access
infrastructure and security solutions in North America, and SKYDATA Corporation, a value-added
distributor of data storage solutions in Canada, for aggregate cash consideration of $165.3
million. In addition, the company made payments of $10.9&nbsp;million to increase its ownership
interest in majority-owned subsidiaries and for other purchase consideration.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During the fourth quarter of 2006, the company initiated a global ERP effort to standardize
processes worldwide and adopt best-in-class capabilities. Implementation is expected to be
phased-in over the next several years. For 2009, the estimated cash flow impact of this initiative
is expected to be in the $80 to $100&nbsp;million range with the annual impact decreasing by
approximately $50&nbsp;million in 2010. The company expects to finance these costs with cash flows from
operations.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Cash Flows from Financing Activities</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for financing activities during 2008 was $111.1&nbsp;million, primarily
reflecting $115.8&nbsp;million of repurchases of common stock offset, in part, by $4.4&nbsp;million of cash
proceeds from the exercise of stock options.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for financing activities during 2007 was $82.2&nbsp;million. Net repayments
of short-term borrowings of $90.3&nbsp;million, repayments of long-term borrowings of $169.1&nbsp;million
related to the company&#146;s 7% senior notes that were repaid in January&nbsp;2007 in accordance with their
terms, and repurchases of common stock of $84.2&nbsp;million were the primary uses of cash. This was
offset, in part, by net proceeds from long-term borrowings of $198.5&nbsp;million, which include
proceeds from a $200.0&nbsp;million term loan due in 2012, proceeds from the exercise of stock options
of $55.2&nbsp;million, and $7.7&nbsp;million related to excess tax benefits from stock-based compensation
arrangements.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The net amount of cash used for financing activities during 2006 was $132.7&nbsp;million, primarily
reflecting $160.6&nbsp;million used to repurchase convertible debentures and senior notes, $15.7&nbsp;million
in other long-term debt repayments, and $22.3&nbsp;million of net repayments of short-term borrowings,
offset, in part, by $59.2&nbsp;million of proceeds from the exercise of stock options and $6.7&nbsp;million
relating to excess tax benefits from stock-based compensation arrangements.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company redeemed the total amount outstanding of $283.2&nbsp;million principal amount
($156.4&nbsp;million accreted value) of its convertible debentures and repurchased $4.1&nbsp;million
principal amount of its 7% senior notes due in January&nbsp;2007. The related loss on the redemption
and repurchase, including any related premium paid, write-off of deferred financing costs, and cost
of terminating a portion of the related interest rate swaps, aggregated $2.6&nbsp;million ($1.6&nbsp;million
net of related taxes or $.01 per share on both a basic and diluted basis). As a result of these
transactions, net interest expense was reduced by approximately $2.6&nbsp;million from the dates of
redemption and repurchase through the respective maturity dates, based on interest rates in effect
at the time of the redemption and repurchase.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has an $800.0&nbsp;million revolving credit facility with a group of banks that matures in
January&nbsp;2012. Interest on borrowings under the revolving credit facility is calculated using a
base rate or a euro currency rate plus a spread based on the company&#146;s credit ratings (.425% at
December&nbsp;31, 2008). The facility fee related to the revolving credit facility is .125%. The
company also entered into a $200.0&nbsp;million term loan with the same group of banks, which is
repayable in full in January&nbsp;2012. Interest on the term loan is calculated using a base rate or
euro currency rate plus a spread based on the company&#146;s credit ratings (.60% at December&nbsp;31, 2008).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has a $600.0&nbsp;million asset securitization program collateralized by accounts receivable
of certain of its North American subsidiaries which expires in March&nbsp;2010. Interest on borrowings
is calculated using a base rate or a commercial paper rate plus a spread, which is based on the
company&#146;s credit ratings (.225% at December&nbsp;31, 2008). The facility fee is .125%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">There were no outstanding borrowings under the revolving credit facility or the asset
securitization program at December&nbsp;31, 2008 and 2007. The revolving credit facility and asset
securitization program include terms and conditions that limit the incurrence of additional
borrowings, limit the company&#146;s ability to pay cash dividends or repurchase stock, and require
that certain financial ratios be maintained at designated levels. The company was in compliance
with all covenants as of December&nbsp;31, 2008. The company is not aware of any events that would
cause non-compliance in the future.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->33<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Contractual Obligations</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Payments due under contractual obligations at December&nbsp;31, 2008 are as follows (in thousands):
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Within</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>1-3</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>4-5</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>After</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>1 Year</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Years</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Years</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>5 Years</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>
<tr>
    <TD>&nbsp;</TD>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">52,332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">258,212</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">562,183</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">402,580</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,275,307</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest on long-term debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">131,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">93,486</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">270,708</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">577,173</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Capital leases</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">561</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,571</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Operating leases</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57,052</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77,664</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43,477</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,460</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">192,653</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Purchase obligations (a)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,329,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,193</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,825</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,346,089</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other (b)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,358</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,915</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,091</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">67,739</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,551,299</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">501,310</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">711,887</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">696,036</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,460,532</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 3pt; width: 18%; border-top: 0px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Amounts represent an estimate of non-cancelable inventory purchase orders and other
contractual obligations related to information technology and facilities as of December&nbsp;31,
2008. Most of the company&#146;s inventory purchases are pursuant to authorized distributor
agreements, which are typically cancelable by either party at any time or on short notice,
usually within a few months.</DIV></TD>
</TR>
<tr>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(b)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes estimates of contributions required to meet the requirements of several defined
benefit plans. Amounts are subject to change based upon the performance of plan assets, as
well as the discount rate used to determine the obligation. The company is unable to estimate
the projected contributions beyond 2015. Also included are amounts relating to personnel,
facilities, customer termination, and certain other costs resulting from restructuring and
integration activities.</DIV></TD>
</TR>

</TABLE>



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Under the terms of various joint venture agreements, the company is required to pay its pro-rata
share of the third party debt of the joint ventures in the event that the joint ventures are unable
to meet their obligations. At December&nbsp;31, 2008, the company&#146;s pro-rata share of this debt was
approximately $11.8&nbsp;million. The company believes there is sufficient equity in the joint ventures
to meet their obligations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Also, as discussed in Note 8 of the Notes to Consolidated Financial Statements, effective January
1, 2007, the company adopted the provisions of FASB Interpretation No.&nbsp;48, &#147;Accounting for
Uncertainty in Income Taxes &#151; an interpretation of FASB Statement No.&nbsp;109.&#148; At December&nbsp;31, 2008,
the company had a liability for unrecognized tax benefits and a liability for the payment of
related interest totaling $81.4&nbsp;million, of which approximately $10.3&nbsp;million is expected to be
paid within one year. For the remaining liability, due to the uncertainties related to these tax
matters, the company is unable to make a reasonably reliable estimate when cash settlement with a
taxing authority will occur.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Off-Balance Sheet Arrangements</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has no off-balance sheet financing or unconsolidated special-purpose entities.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Critical Accounting Policies and Estimates</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s consolidated financial statements are prepared in accordance with accounting
principles generally accepted in the United States. The preparation of these financial statements
requires the company to make significant estimates and judgments that affect the reported amounts
of assets, liabilities, revenues, and expenses and related disclosure of contingent assets and
liabilities. The company evaluates its estimates on an ongoing basis. The company bases its
estimates on historical experience and on various
other assumptions that are believed reasonable under the circumstances; the results of which form
the basis for making judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources. Actual results may differ from these estimates under different
assumptions or conditions.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->34<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes the following critical accounting policies involve the more significant
judgments and estimates used in the preparation of its consolidated financial statements:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Revenue Recognition</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recognizes revenue in accordance with the SEC Staff Accounting Bulletin No.&nbsp;104,
&#147;Revenue Recognition&#148; (&#147;SAB 104&#148;). Under SAB 104, revenue is recognized when there is persuasive
evidence of an arrangement, delivery has occurred or services are rendered, the sales price is
determinable, and collectibility is reasonably assured. Revenue typically is recognized at time of
shipment. Sales are recorded net of discounts, rebates, and returns, which historically were not
material.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A portion of the company&#146;s business involves shipments directly from its suppliers to its
customers. In these transactions, the company is responsible for negotiating price both with the
supplier and customer, payment to the supplier, establishing payment terms with the customer,
product returns, and has risk of loss if the customer does not make payment. As the principal with
the customer, the company recognizes the sale and cost of sale of the product upon receiving
notification from the supplier that the product was shipped.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In addition, the company has certain business with select customers and suppliers that is accounted
for on an agency basis (that is, the company recognizes the fees associated with serving as an
agent in sales with no associated cost of sales) in accordance with Emerging Issues Task Force
(&#147;EITF&#148;) Issue No.&nbsp;99-19, &#147;Reporting Revenue Gross as a Principal versus Net as an Agent.&#148;
Generally, these transactions relate to the sale of supplier service contracts to customers where
the company has no future obligation to perform under these contracts or the rendering of logistics
services for the delivery of inventory for which the company does not assume the risks and rewards
of ownership.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Accounts Receivable</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains allowances for doubtful accounts for estimated losses resulting from the
inability of its customers to make required payments. The allowances for doubtful accounts are
determined using a combination of factors, including the length of time the receivables are
outstanding, the current business environment, and historical experience.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Inventories</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Inventories are stated at the lower of cost or market. Write-downs of inventories to market value
are based upon contractual provisions governing price protection, stock rotation, and obsolescence,
as well as assumptions about future demand and market conditions. If assumptions about future
demand change and/or actual market conditions are less favorable than those projected by the
company, additional write-downs of inventories may be required. Due to the large number of
transactions and the complexity of managing the process around price protections and stock
rotations, estimates are made regarding adjustments to the book cost of inventories. Actual amounts
could be different from those estimated.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Investments</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company assesses its long-term investments accounted for as available-for-sale on a quarterly
basis to determine whether declines in market value below cost are other-than-temporary. When the
decline is determined to be other-than-temporary, the cost basis for the individual security is
reduced and a loss is realized in the company&#146;s consolidated statement of operations in the period
in which it occurs. When the decline is determined to be temporary, the unrealized losses are
included in the shareholders&#146; equity section in the company&#146;s consolidated balance sheets in
&#147;Other.&#148; The company makes such
determination based upon the quoted market price, financial condition, operating results of the
investee, and the company&#146;s intent and ability to retain the investment over a period of time,
which would be sufficient to allow for any recovery in market value. In addition, the company
assesses the following factors:
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->35<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#167;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">broad economic factors impacting the investee&#146;s industry;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#167;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">publicly available forecasts for sales and earnings growth for the industry and
investee; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#167;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">the cyclical nature of the investee&#146;s industry.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During
the fourth quarter of 2008, the company determined an
other-than-temporary decline in the fair value of its investment in
Marubun Corporation had occurred and, accordingly, recognized a loss
of $10.0 million ($.08 per share on both a basic and diluted basis) on
the write-down of this investment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
company could incur an additional impairment charge in future periods if, among other factors, the
investee&#146;s future earnings differ from currently available forecasts.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Income Taxes</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The carrying value of the company&#146;s deferred tax assets is dependent upon the company&#146;s ability to
generate sufficient future taxable income in certain tax jurisdictions. Should the company
determine that it is more likely than not that some portion or all of its deferred tax assets will
not be realized, a valuation allowance to the deferred tax assets would be established in the
period such determination was made.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">It is the company&#146;s policy to provide for uncertain tax positions and the related interest and
penalties based upon management&#146;s assessment of whether a tax benefit is more likely than not to be
sustained upon examination by tax authorities. At December&nbsp;31, 2008, the company believes it has
appropriately accounted for any unrecognized tax benefits. To the extent the company prevails in
matters for which a liability for an unrecognized tax benefit is established or is required to pay
amounts in excess of the liability, the company&#146;s effective tax rate in a given financial statement
period may be affected.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Financial Instruments</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company uses various financial instruments, including derivative financial instruments, for
purposes other than trading. Derivatives used as part of the company&#146;s risk management strategy
are designated at inception as hedges and measured for effectiveness both at inception and on an
ongoing basis. The company enters into interest rate swap transactions that convert certain
fixed-rate debt to variable-rate debt or variable-rate debt to fixed-rate debt in order to manage
its targeted mix of fixed- and floating-rate debt. The effective portion of the change in the fair
value of interest rate swaps designated as fair value hedges is recorded as a change to the
carrying value of the related hedged debt, and the effective portion of the change in fair value of
interest rate swaps designated as cash flow hedges is recorded in the shareholders&#146; equity section
in the company&#146;s consolidated balance sheets in &#147;Other.&#148; The ineffective portion of the interest
rate swap, if any, is recorded in &#147;Interest expense, net&#148; in the company&#146;s consolidated statements
of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The effective portion of the change in the fair value of derivatives designated as net investment
hedges is recorded in &#147;Foreign currency translation adjustment&#148; included in the company&#146;s
consolidated balance sheets and any ineffective portion is recorded in earnings. The company uses
the hypothetical derivative method to assess the effectiveness of its net investment hedge on a
quarterly basis.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Contingencies and Litigation</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is subject to proceedings, lawsuits, and other claims related to environmental, labor,
product, tax, and other matters. The company assesses the likelihood of an adverse judgment or
outcomes for these matters, as well as the range of potential losses. A determination of the
reserves required, if any, is made after careful analysis. The required reserves may change in the
future due to new developments impacting the probability of a loss, the estimate of such loss, and
the probability of recovery of such loss from third parties.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Restructuring and Integration</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recorded charges in connection with restructuring its businesses, and the integration
of acquired businesses. These items primarily include employee separation costs and estimates
related to the consolidation of facilities (net of sub-lease income), contractual obligations, and
the valuation of certain assets. Actual amounts could be different from those estimated.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Stock-Based Compensation</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company records share-based payment awards exchanged for employee services at fair value on the
date of grant and expenses the awards in the consolidated statements of operations over the
requisite employee service period. Stock-based compensation expense includes an estimate for
forfeitures and is recognized over the expected term of the award on a straight-line basis. The
fair value of stock options is determined using the Black-Scholes valuation model and the
assumptions shown in Note 12 of the Notes to Consolidated Financial Statements. The assumptions
used in calculating the fair value of share-based payment awards represent management&#146;s best
estimates. The company&#146;s estimates may be impacted by certain variables including, but not limited
to, stock price volatility, employee stock option exercise behaviors, additional stock option
grants, estimates of forfeitures, and related tax impacts.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Employee Benefit Plans</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The costs and obligations of the company&#146;s defined benefit pension plan are dependent on actuarial
assumptions. The two critical assumptions used, which impact the net periodic pension cost (income)
and the benefit obligation, are the discount rate and expected return on plan assets. The discount
rate represents the market rate for a high quality corporate bond, and the expected return on plan
assets is based on current and expected asset allocations, historical trends, and expected returns
on plan assets. These key assumptions are evaluated annually. Changes in these assumptions can
result in different expense and liability amounts.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Costs in Excess of Net Assets of Companies Acquired</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill represents the excess of the cost of an acquisition over the fair value of the assets
acquired. The company tests goodwill for impairment annually as of the first day of the fourth
quarter, and when an event occurs or circumstances change such that it is more likely than not that
an impairment may exist, such as (i)&nbsp;a significant adverse change in legal factors or in business
climate, (ii)&nbsp;an adverse action or assessment by a regulator, (iii)&nbsp;unanticipated competition, (iv)
a loss of key personnel, (v)&nbsp;a more-likely-than-not sale or disposal of all or a significant
portion of a reporting unit, (vi)&nbsp;the testing for recoverability of a significant asset group
within a reporting unit, or (vii)&nbsp;the recognition of a goodwill impairment loss of a subsidiary
that is a component of the reporting unit. In addition, goodwill is required to be tested for
impairment after a portion of the goodwill is allocated to a business targeted for disposal.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill is reviewed for impairment utilizing a two-step process. The first step of the impairment
test requires the identification of the reporting units and comparison of the fair value of each of
these reporting units to the respective carrying value. The company&#146;s reporting units are defined
as global ECS and each of the three regional businesses within the global components business
segment, which are North America, EMEASA, and Asia/Pacific. If the carrying value of the reporting
unit is less than its fair value, no impairment exists and the second step is not performed. If
the carrying value of the reporting unit is higher than its fair
value, the second step must be performed to compute the amount of the
goodwill impairment, if any.
In the second step, the impairment is computed by comparing the implied fair value of the
reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of the
reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is
recognized for the excess.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Historically, the company estimated the fair value of a reporting unit using a three-year weighted
average multiple of earnings before interest and taxes from comparable companies, which utilizes a
look-back approach. The assumptions utilized in the evaluation of the impairment of goodwill under
this approach include the identification of reporting units and the selection of comparable
companies, which are critical
accounting estimates subject to change. As of the first day of the fourth quarter of 2008, the
company&#146;s historical approach did not indicate impairment at any of the company&#146;s
reporting units.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of significant declines in macroeconomic conditions, there has been a
decline in global equity valuations since October&nbsp;1, 2008. Both of these factors have impacted the
company&#146;s
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">market capitalization, and the company determined that it was prudent to supplement its
historical goodwill impairment testing methodology with a forward-looking discounted cash flow
methodology. The assumptions included in the discounted cash flow methodology included forecasted
revenues, gross profit margins, operating income margins, working capital cash flow, perpetual
growth rates, and long-term discount rates, among others, all of which require significant judgments
by management. The company also reconciled its discounted
 cash flow analysis to its current market
capitalization allowing for a reasonable control premium. Based upon
the results of the supplemental discounted cash flow approach, no impairment
existed as of October&nbsp;1, 2008. Based upon the results of the discounted
cash flow approach as of December&nbsp;31, 2008, the carrying value
of the global
ECS reporting unit and the EMEASA and Asia/Pacific reporting units within the global components
business segment were higher than their fair value and, accordingly,
the company performed a step-two impairment analysis. The fair value
of the North America reporting unit within the global components
business segment was higher than its carrying value and a step-two
impairment analysis was not required.  The results of the step-two impairment analysis indicated that goodwill related
to the EMEASA and Asia/Pacific reporting units within the global components business segment were
fully impaired and the goodwill related to the global ECS business segment was partially impaired.
The company recognized a total non-cash impairment charge of
$1.02&nbsp;billion ($901.5&nbsp;million net of
related taxes or $7.49 per share on both a basic and diluted basis)
as of December 31, 2008,
of which $716.9&nbsp;million
related to the company&#146;s global components business segment and $301.9&nbsp;million related to the
company&#146;s global ECS business segment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
impairment charge did not impact the company&#146;s consolidated cash
flows, liquidity, capital
resources, and covenants under its existing revolving credit facility, asset
securitization program, and other outstanding borrowings. A continued decline in
general economic conditions or global equity valuations, could impact the judgments and assumptions
about the fair value of the company&#146;s business. If general economic conditions or global equity
valuations continue to decline, the company could be required to record an additional impairment
charge in the future, which could impact the company&#146;s consolidated balance sheet, as well as the
company&#146;s consolidated statement of operations. If the company was required to recognize an
additional impairment charge in the future, the charge would not impact the company&#146;s consolidated
cash flows, current liquidity, capital resources, and covenants under its
existing revolving credit facility, asset securitization program, and
other outstanding borrowings.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Impairment of Long-Lived Assets</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company reviews long-lived assets, including property, plant and equipment and identifiable
intangible assets, for impairment whenever changes in circumstances or events may indicate that the
carrying amounts may not be recoverable. If the fair value is less than the carrying amount of the
asset, a loss is recognized for the difference.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During the fourth quarter of 2008, the company recorded an impairment charge of $25.4&nbsp;million in
connection with an approved plan to market and sell a building and related land in North America
within the company&#146;s global components business segment. The company wrote-down the carrying
values of the building and related land to their estimated fair values less cost to sell and ceased
recording depreciation. The asset was designated as an asset held for sale and is included in
&#147;Prepaid expenses and other assets&#148; on the company&#146;s consolidated balance sheet as of December&nbsp;31,
2008. The sale is expected to be completed within the next twelve months.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company recorded a charge related to the write-down of certain capitalized
software in Europe of $4.5&nbsp;million. This write-down resulted from the company&#146;s decision to
implement a global ERP system, which caused these software costs to become redundant and have no
future benefit.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Factors which may cause an impairment of long-lived assets include significant changes in the
manner of
use of these assets, negative industry or market trends, a significant underperformance relative to
historical or projected future operating results, or a likely sale or disposal of the asset before
the end of its estimated useful life. If any of these factors exist, the company would be required
to test the long-lived asset for recoverability and may be required to recognize an impairment
charge for all or a portion of the asset&#146;s carrying value.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of significant declines in macroeconomic conditions, there has been a decline in global equity valuations since October&nbsp;1, 2008. Both of these factors have impacted the
company&#146;s market capitalization, and the company determined it was necessary to review the
recoverability its long-lived assets to be held and used, including property, plant and equipment
and identifiable intangible assets, by comparing the carrying value of the related asset groups to the
undiscounted cash flows directly attributable to the asset groups over the estimated useful life of
those assets. Based upon the results of such tests as of December&nbsp;31, 2008, the company&#146;s
long-lived assets to be held and used were not impaired.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Shipping and Handling Costs</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Shipping and handling costs may be reported as either a component of cost of products sold or
selling, general and administrative expenses. The company reports shipping and handling costs,
primarily related to outbound freight, in the consolidated statements of operations as a component
of selling, general and administrative expenses. If the company included such costs in cost of
products sold, gross profit margin as a percentage of sales for 2008 would decrease from 13.6% to
13.2% with no impact on reported earnings.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Impact of Recently Issued Accounting Standards</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In March&nbsp;2008, the FASB issued Statement of Financial Accounting Standards No.&nbsp;161, &#147;Disclosures
about Derivative Instruments and Hedging Activities&#148; (&#147;Statement No.&nbsp;161&#148;). Statement No.&nbsp;161
changes the disclosure requirements for derivative instruments and hedging activities. Entities
are required to provide disclosures about (a)&nbsp;how and why an entity uses derivative instruments,
(b)&nbsp;how derivative instruments and related hedged items are accounted for under FASB Statement No.
133, &#147;Accounting for Derivative Instruments and Hedging Activities,&#148; and its related
interpretations, and (c)&nbsp;how derivative instruments and related hedged items affect an entity&#146;s
financial position, results of operations, and cash flows. Statement No.&nbsp;161 is effective for
fiscal years and interim periods beginning after November&nbsp;15, 2008 and requires comparative
disclosures only for periods subsequent to initial adoption. The adoption of the provisions of
Statement No.&nbsp;161 will not impact the company&#146;s consolidated financial position and results of
operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007, the FASB issued Statement of Financial Accounting Standards No.&nbsp;141 (revised
2007), &#147;Business Combinations&#148; (&#147;Statement No.&nbsp;141(R)&#148;). Statement No.&nbsp;141(R) requires, among
other things, the acquiring entity in a business combination to recognize the fair value of all the
assets acquired and liabilities assumed; the recognition of acquisition-related costs in the
consolidated results of operations; the recognition of restructuring costs in the consolidated
results of operations for which the acquirer becomes obligated after the acquisition date; and
contingent purchase consideration to be recognized at their fair values on the acquisition date
with subsequent adjustments recognized in the consolidated results of operations. Statement No.
141(R) is effective for annual periods beginning after December&nbsp;15, 2008 and should be applied
prospectively for all business combinations entered into after the date of adoption.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007, the FASB issued Statement of Financial Accounting Standards No.&nbsp;160,
&#147;Noncontrolling Interests in Consolidated Financial Statements &#151; an amendment of ARB No.&nbsp;51&#148;
(&#147;Statement No.&nbsp;160&#148;). Statement No.&nbsp;160 requires that noncontrolling interests be reported as a
component of shareholders&#146; equity; net income attributable to the parent and the noncontrolling
interest be separately identified in the consolidated results of operations; changes in a parent&#146;s
ownership interest be treated as equity transactions if control is maintained; and upon a loss of
control, any gain or loss on the interest be recognized in the consolidated results of operations.
Statement No.&nbsp;160 also requires expanded disclosures to clearly identify and distinguish between
the interests of the parent and the
interests of the noncontrolling owners. Statement No.&nbsp;160 is effective for annual periods beginning
after December&nbsp;15, 2008 and should be applied prospectively. However, the presentation and
disclosure requirements of the statement shall be applied retrospectively for all periods
presented. The adoption of the provisions of Statement No.&nbsp;160 is not anticipated to materially
impact the company&#146;s consolidated financial position and results of operations.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Information Relating to Forward-Looking Statements</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">This report includes forward-looking statements that are subject to numerous assumptions, risks,
and uncertainties, which could cause actual results or facts to differ materially from such
statements for a variety of reasons, including, but not limited to: industry conditions, the
company&#146;s implementation of its new enterprise resource planning system, changes in product supply,
pricing and customer demand, competition, other vagaries in the global components and global ECS
markets, changes in relationships with key suppliers, increased profit margin pressure, the effects
of additional actions taken to become more efficient or lower costs, and the company&#146;s ability to
generate additional cash flow. Forward-looking statements are those statements, which are not
statements of historical fact. These forward-looking statements can be identified by
forward-looking words such as &#147;expects,&#148; &#147;anticipates,&#148; &#147;intends,&#148; &#147;plans,&#148; &#147;may,&#148; &#147;will,&#148;
&#147;believes,&#148; &#147;seeks,&#148; &#147;estimates,&#148; and similar expressions. Shareholders and other readers are
cautioned not to place undue reliance on these forward-looking statements, which speak only as of
the date on which they are made. The company undertakes no obligation to update publicly or revise
any of the forward-looking statements.
</DIV>


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</DIV>



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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left">
<A name="112"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;7A. </B><U><B>Quantitative and Qualitative Disclosures About Market Risk</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is exposed to market risk from changes in foreign currency exchange rates and interest
rates.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Foreign Currency Exchange Rate Risk</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company, as a large, global organization, faces exposure to adverse movements in foreign
currency exchange rates. These exposures may change over time as business practices evolve and
could materially impact the company&#146;s financial results in the future. The company&#146;s primary
exposure relates to transactions in which the currency collected from customers is different from
the currency utilized to purchase the product sold in Europe, the Asia Pacific region, Canada, and
Latin America. The company&#146;s policy is to hedge substantially all such currency exposures for which
natural hedges do not exist. Natural hedges exist when purchases and sales within a specific
country are both denominated in the same currency and, therefore, no exposure exists to hedge with
foreign exchange forward, option, or swap contracts (collectively, the &#147;foreign exchange
contracts&#148;). In many regions in Asia, for example, sales and purchases are primarily denominated in
U.S. dollars, resulting in a &#147;natural hedge.&#148; Natural hedges exist in most countries in which the
company operates, although the percentage of natural offsets, as compared with offsets that need to
be hedged by foreign exchange contracts, will vary from country to country. The company does not
enter into foreign exchange contracts for trading purposes. The risk of loss on a foreign exchange
contract is the risk of nonperformance by the counterparties, which the company minimizes by
limiting its counterparties to major financial institutions. The fair value of the foreign exchange
contracts is estimated using market quotes. The notional amount of the foreign exchange contracts
at December&nbsp;31, 2008 and 2007 was $315.0&nbsp;million and $262.9&nbsp;million, respectively. The carrying
amounts, which are nominal, approximated fair value at December&nbsp;31, 2008 and 2007.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The translation of the financial statements of the non-United States operations is impacted by
fluctuations in foreign currency exchange rates. The change in consolidated sales and operating
loss was impacted by the translation of the company&#146;s international financial statements into U.S.
dollars. This resulted in increased sales of $293.4&nbsp;million and a decreased operating loss of
$18.1&nbsp;million for 2008, compared with the year-earlier period, based on 2007 sales and operating
income at the average rate for 2008. Sales would decrease and the operating loss would increase by
approximately $534.8&nbsp;million and $19.8&nbsp;million, respectively, if average foreign exchange rates had
declined by 10% against the U.S. dollar in 2008. This amount was determined by considering the
impact of a hypothetical foreign exchange rate on the sales and operating income of the company&#146;s
international operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In May&nbsp;2006, the company entered into a cross-currency swap, with a maturity date of July&nbsp;2011, for
approximately $100.0&nbsp;million or <FONT face="'Times New Roman',times,serif">&#128;</FONT>78.3&nbsp;million (the &#147;2006 cross-currency swap&#148;) to hedge a portion
of its net investment in euro-denominated net assets. The 2006 cross-currency swap is designated
as a net investment hedge and effectively converts the interest expense on $100.0&nbsp;million of
long-term debt from U.S. dollars to euros. As the notional amount of the 2006 cross-currency swap
is expected to equal a comparable amount of hedged net assets, no material ineffectiveness is
expected. The 2006 cross-currency swap had a negative fair value of $10.0&nbsp;million and $14.4
million at December&nbsp;31, 2008 and 2007, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In October&nbsp;2005, the company entered into a cross-currency swap, with a maturity date of October
2010, for approximately $200.0&nbsp;million or <FONT face="'Times New Roman',times,serif">&#128;</FONT>168.4&nbsp;million (the &#147;2005 cross-currency swap&#148;) to hedge
a portion of its net investment in euro-denominated net assets. The 2005 cross-currency swap is
designated as a net investment hedge and effectively converts the interest expense on $200.0
million of long-term debt from U.S. dollars to euros. As the notional amount of the 2005
cross-currency swap is expected to equal a comparable amount of hedged net assets, no material
ineffectiveness is expected. The 2005 cross-currency swap had a negative fair value of $36.5
million and $46.2&nbsp;million at December&nbsp;31, 2008 and 2007, respectively.
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Interest Rate Risk</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s interest expense, in part, is sensitive to the general level of interest rates in
North America, Europe, and the Asia Pacific region. The company historically has managed its
exposure to interest rate risk through the proportion of fixed-rate and floating-rate debt in its
total debt portfolio. Additionally, the company utilizes interest rate swaps in order to manage
its targeted mix of fixed- and floating-rate debt.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">At December&nbsp;31, 2008, approximately 60% of the company&#146;s debt was subject to fixed rates, and 40%
of its debt was subject to floating rates. A one percentage point change in average interest rates
would not materially impact interest expense, net of interest income, in 2008. This was determined
by considering the impact of a hypothetical interest rate on the company&#146;s average floating rate on
investments and outstanding debt. This analysis does not consider the effect of the level of
overall economic activity that could exist. In the event of a change in the level of economic
activity, which may adversely impact interest rates, the company could likely take actions to
further mitigate any potential negative exposure to the change. However, due to the uncertainty of
the specific actions that might be taken and their possible effects, the sensitivity analysis
assumes no changes in the company&#146;s financial structure.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007 and January&nbsp;2008, the company entered into a series of interest rate swaps (the
&#147;2007 and 2008 swaps&#148;) with a notional amount of $100.0&nbsp;million. The 2007 and 2008 swaps modify
the company&#146;s interest rate exposure by effectively converting the variable rate (3.201% at
December&nbsp;31, 2008) on a portion of its $200.0&nbsp;million term loan to a fixed rate of 4.457% per annum
through December&nbsp;2009. The 2007 and 2008 swaps are designated as cash flow hedges and had a
negative fair value of $1.9&nbsp;million and $.2&nbsp;million at December&nbsp;31, 2008 and 2007, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In June&nbsp;2004, the company entered into a series of interest rate swaps (the &#147;2004 swaps&#148;), with an
aggregate notional amount of $300.0&nbsp;million. The 2004 swaps modify the company&#146;s interest rate
exposure by effectively converting the fixed 9.15% senior notes to a floating rate, based on the
six-month U.S. dollar LIBOR plus a spread (an effective rate of 8.19% and 9.50% at December&nbsp;31,
2008 and 2007, respectively), and a portion of the fixed 6.875% senior notes to a floating rate,
also based on the six-month U.S. dollar LIBOR plus a spread (an effective rate of 5.01% and 7.24%
at December&nbsp;31, 2008 and 2007, respectively), through their maturities. The 2004 swaps are
designated as fair value hedges and had a fair value of $21.4&nbsp;million and $7.5&nbsp;million at December
31, 2008 and 2007, respectively.
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left">
<A name="113"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;8. </B><U><B>Financial Statements and Supplementary Data</B></U><B>.</B>
</DIV>

<DIV align="left">
<A name="300"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>REPORT OF ERNST &#038; YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt">The Board of Directors and Shareholders<BR>
Arrow Electronics, Inc.

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We have audited the accompanying consolidated balance sheets of Arrow Electronics, Inc. (the
&#147;company&#148;) as of December&nbsp;31, 2008 and 2007, and the related consolidated statements of operations,
shareholders&#146; equity, and cash flows for each of the three years in the period ended December&nbsp;31,
2008. Our audits also included the financial statement schedule listed in the Index at Item&nbsp;15(a).
These financial statements and the schedule are the responsibility of the company&#146;s management. Our
responsibility is to express an opinion on these financial statements and the schedule based on our
audits.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We conducted our audits in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In our opinion, the financial statements referred to above present fairly, in all material
respects, the consolidated financial position of Arrow Electronics, Inc. at December&nbsp;31, 2008 and
2007, and the consolidated results of their operations and their cash flows for each of the three
years in the period ended December&nbsp;31, 2008, in conformity with U.S. generally accepted accounting
principles. Also, in our opinion, the related financial statement schedule, when considered in
relation to the basic financial statements taken as a whole, presents fairly, in all material
respects the information set forth therein.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We also have audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), Arrow Electronics, Inc.&#146;s internal control over financial reporting as of
December&nbsp;31, 2008, based on criteria established in Internal Control-Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February
24, 2009 expressed an unqualified opinion thereon.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 22pt">/s/ ERNST &#038; YOUNG LLP
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 22pt">New York, New York<BR>
February&nbsp;24, 2009

</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->43<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="left">
<A name="301"></A>
</DIV>
<DIV align="center" style="font-size: 10pt"><B>CONSOLIDATED STATEMENTS OF OPERATIONS<br>
(In thousands except per share data)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="10" style="border-bottom: 1px solid #000000"><B>Years Ended December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR style="font-size: 10pt" valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,761,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Costs and expenses:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Cost of products sold</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,478,296</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,699,715</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,545,719</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Selling, general and administrative expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,607,261</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,519,908</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,362,149</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Depreciation and amortization</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">66,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46,904</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Restructuring and integration charges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">70,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,829</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Impairment charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,018,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Preference claim from 2001</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,890</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Pre-acquisition warranty claim</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,837</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Pre-acquisition environmental matters</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,449</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,254,578</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,298,087</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,970,887</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Operating income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(493,569</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">686,905</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">606,225</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Equity in earnings of affiliated companies</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,549</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,906</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,221</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Loss on prepayment of debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,605</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>










<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Loss on the
write-down of an investment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,030</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>















<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest expense, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">99,863</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">101,628</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">90,564</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Income (loss)&nbsp;before income taxes and minority interest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(596,913</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">592,183</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">518,277</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Provision for income taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,722</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">180,697</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">128,457</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Income (loss)&nbsp;before minority interest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(613,635</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">411,486</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">389,820</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Minority interest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">104</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,694</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,489</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)&nbsp;per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.16</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Average number of shares outstanding:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123,176</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">121,667</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">124,429</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123,181</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 10pt">See accompanying notes.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->44<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="left">
<A name="302"></A>
</DIV>
<DIV align="center" style="font-size: 10pt"><B>CONSOLIDATED BALANCE SHEETS</B></DIV>


<DIV align="center" style="font-size: 10pt"><B>(In thousands except par value)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>ASSETS</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Current assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">451,272</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">447,731</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Accounts receivable, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,087,290</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,281,169</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Inventories</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,626,559</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,679,866</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">180,647</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">180,629</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Total current assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,345,768</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,589,395</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Property, plant and equipment, at cost:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Land</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,127</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41,553</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Buildings and improvements</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">147,138</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">175,979</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Machinery and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">698,156</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">580,278</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">870,421</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">797,810</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Less: Accumulated depreciation and amortization</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(459,881</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(442,649</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Property, plant and equipment, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">410,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">355,161</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Investments in affiliated companies</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46,788</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47,794</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost in excess of net assets of companies acquired</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">905,848</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,779,235</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">409,341</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">288,275</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Total assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,118,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,059,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>LIABILITIES AND SHAREHOLDERS&#146; EQUITY</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Current liabilities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Accounts payable </DIV></TD>
    <TD>&nbsp;</TD>
    <TD>$</TD>
    <TD align="right">2,459,922</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,535,583</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">455,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">438,898</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Short-term borrowings, including current portion of long-term debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,893</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,893</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Total current liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,968,362</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,987,374</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Long-term debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,223,985</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,223,337</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">249,240</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297,289</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Shareholders&#146; equity:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Common stock, par value $1:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Authorized  - 160,000 shares in 2008 and 2007
Issued  - 125,048 and 125,039 shares in 2008 and 2007, respectively</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125,048</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125,039</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Capital in excess of par value</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,035,302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,025,611</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Retained earnings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,571,005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,184,744</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Foreign currency translation adjustment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">172,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">312,755</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(36,912</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(8,720</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,866,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,639,429</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Less: Treasury stock (5,740 and 2,212 shares in 2008 and 2007,
respectively), at cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(190,273</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(87,569</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Total shareholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,676,698</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,551,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:3pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Total liabilities and shareholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,118,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,059,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 10pt">See accompanying notes.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->45<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="left">
<A name="303"></A>
</DIV>
<DIV align="center" style="font-size: 10pt"><B>CONSOLIDATED STATEMENTS OF CASH FLOWS</B></DIV>


<DIV align="center" style="font-size: 10pt"><B>(In thousands)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="10" style="border-bottom: 1px solid #000000"><B>Years Ended December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash flows from operating activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Adjustments to reconcile net income (loss)&nbsp;to net cash provided by
operations:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Depreciation and amortization</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">66,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46,904</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Amortization of stock-based compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,092</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,389</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,268</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Amortization of deferred financing costs and discount on notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,162</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,144</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,808</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Equity in earnings of affiliated companies</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6,549</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6,906</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,221</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Minority interest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">104</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,694</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,489</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Deferred income taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(88,212</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,661</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(9,433</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Restructuring and integration charges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,036</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,977</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Impairment charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,018,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Preference claim from 2001</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,576</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Impact of settlement of tax matters</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,488</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(50,376</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Excess tax benefits from stock-based compensation arrangements</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(161</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,687</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6,661</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Accretion of discount on zero coupon convertible debentures</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">876</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Pre-acquisition warranty claim and environmental matters</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,728</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Loss on prepayment of debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,558</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Loss on the
write-down of an investment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,030</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Change in assets and liabilities, net of effects of acquired
businesses:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Accounts receivable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">269,655</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(279,636</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(202,135</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Inventories</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">85,489</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">116,657</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(119,612</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,504</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(19,315</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(25,131</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Accounts payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(191,669</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">475,155</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,561</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,977</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,458</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">98</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:60px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(22,338</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22,582</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,811</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net cash provided by operating activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">619,799</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">850,743</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,840</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash flows from investing activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Acquisition of property, plant and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(158,688</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(138,834</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(66,078</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Cash consideration paid for acquired businesses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(333,491</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(539,618</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(176,235</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Proceeds from sale of facilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,996</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(512</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(23</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,652</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net cash used for investing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(492,691</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(665,479</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(238,661</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash flows from financing activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Change in short-term borrowings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,604</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(90,318</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(22,298</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Repayment of
revolving credit facility borrowings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,953,950</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,312,251</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(15,687</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Proceeds
from revolving credit facility borrowings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,951,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,510,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Repurchase/repayment of senior notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(169,136</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(4,268</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Redemption of zero coupon convertible debentures</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(156,330</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Proceeds from exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,392</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,228</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">59,194</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Excess tax benefits from stock-based compensation arrangements</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">161</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,687</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,661</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Repurchases of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(115,763</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(84,236</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net cash used for financing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(111,095</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(82,226</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(132,728</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Effect of exchange rate changes on cash</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,472</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,963</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,618</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net increase (decrease)&nbsp;in cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,541</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110,001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(242,931</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash and cash equivalents at beginning of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">447,731</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">337,730</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">580,661</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash and cash equivalents at end of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">451,272</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">447,731</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">337,730</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 10pt">See accompanying notes.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->46<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="left">
<A name="304"></A>
</DIV>
<DIV align="center" style="font-size: 10pt"><B>CONSOLIDATED STATEMENTS OF SHAREHOLDERS&#146; EQUITY</B></DIV>


<DIV align="center" style="font-size: 10pt"><B>(In thousands)</B></DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="23%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Common</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Capital</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Foreign</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>in Excess</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Currency</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>at Par</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>of Par</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Retained</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Translation</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Treasury</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Comprehensive</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Value</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Value</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Earnings</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Adjustment</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Income (Loss)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->


<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at <br>December&nbsp;31, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">120,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">859,485</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,399,415</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,308</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(7,278</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(12,330</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,372,886</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->


    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom">

    <TD><DIV style="margin-left:15px; text-indent:-15px">Net Income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Translation adjustments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">141,858</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">141,858</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized gain on securities, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,683</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,683</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Minimum pension liability adjustments, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,810</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,810</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Comprehensive income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">537,682</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Amortization of stock-based compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,268</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,268</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,339</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56,529</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">58,868</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Tax benefits related to exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,661</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,661</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restricted stock awards, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,790</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,790</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Adjustment to initially apply FASB Statement
No.&nbsp;158</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,570</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,570</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,805</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(42</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,764</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->


    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at<br> December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">122,626</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">943,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,787,746</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">155,166</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,530</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,407</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,996,559</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->


    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Translation adjustments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">157,589</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">157,589</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized gain on securities, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">648</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">648</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized loss on interest rate swaps
designated as cash flow hedges, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(94</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(94</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other employee benefit plan items, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,867</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,867</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Comprehensive income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">564,068</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Amortization of stock-based compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,389</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,389</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,216</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,867</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,083</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Tax benefits related to exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,791</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,791</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restricted stock and performance share awards,
net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,394</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Repurchase of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(84,236</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(84,236</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Adjustment to initially apply EITF Issue
No.&nbsp;06-2</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(10,794</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(10,794</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->


    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at<br> December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">125,039</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,025,611</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,184,744</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">312,755</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(87,569</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(8,720</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,551,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->47<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS&#146; EQUITY (continued)<BR>
(In thousands)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="23%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Common</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Foreign</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Capital</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Currency</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>at Par</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>in Excess of Par</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Retained</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Translation</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Treasury</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Comprehensive</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Value</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Value</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Earnings</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Adjustment</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Income (Loss)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->

<TR valign="bottom" style="font-size:10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at<br> December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">125,039</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,025,611</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,184,744</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">312,755</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(87,569</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(8,720</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,551,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Translation adjustments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(140,227</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(140,227</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized loss on securities, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(14,678</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(14,678</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized loss on interest rate swaps
designated as cash flow hedges, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,032</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,032</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other employee benefit plan items, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,482</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12,482</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Comprehensive income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(782,158</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Amortization of stock-based compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,092</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,092</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,709</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,349</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Tax benefits related to exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">318</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">318</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restricted stock and performance share awards,
net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,010</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Repurchase of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(115,763</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(115,763</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size:6pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at<br> December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">125,048</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,035,302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,571,005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">172,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(190,273</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(36,912</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,676,698</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 10pt">See accompanying notes.
</DIV>


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</DIV>


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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 10pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</B>
</DIV>

<DIV align="left">
<A name="305"></A>
</DIV>
<DIV align="center" style="font-size: 10pt"><B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</B></DIV>


<DIV align="center" style="font-size: 10pt"><B>(Dollars in thousands except per share data)</B></DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><B>1. Summary of Significant Accounting Policies</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Principles of Consolidation</U>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The consolidated financial statements include the accounts of the company and its majority-owned
subsidiaries. All significant intercompany transactions are eliminated.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Use of Estimates</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The preparation of financial statements in conformity with accounting principles generally accepted
in the United States requires the company to make significant estimates and assumptions that affect
the amounts reported in the consolidated financial statements and accompanying notes. Actual
results could differ from those estimates.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Cash and Cash Equivalents</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Cash equivalents consist of highly liquid investments, which are readily convertible into cash,
with original maturities of three months or less.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Financial Instruments</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company uses various financial instruments, including derivative financial instruments, for
purposes other than trading. Derivatives used as part of the company&#146;s risk management strategy
are designated at inception as hedges and measured for effectiveness both at inception and on an
ongoing basis. The company enters into interest rate swap transactions that convert certain
fixed-rate debt to variable-rate debt or variable-rate debt to fixed-rate debt in order to manage
its targeted mix of fixed- and floating-rate debt. The effective portion of the change in the fair
value of interest rate swaps designated as fair value hedges is recorded as a change to the
carrying value of the related hedged debt, and the effective portion of the change in fair value of
interest rate swaps designated as cash flow hedges is recorded in the shareholders&#146; equity section
in the company&#146;s consolidated balance sheets in &#147;Other.&#148; The ineffective portion of the interest
rate swaps, if any, is recorded in &#147;Interest expense, net&#148; in the company&#146;s consolidated statements
of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The effective portion of the change in the fair value of derivatives designated as net investment
hedges is recorded in &#147;Foreign currency translation adjustment&#148; included in the company&#146;s
consolidated balance sheets and any ineffective portion is recorded in earnings. The company uses
the hypothetical derivative method to assess the effectiveness of its net investment hedges on a
quarterly basis.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Inventories</U>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Inventories are stated at the lower of cost or market. Cost approximates the first-in, first-out
method.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Property, Plant and Equipment</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Property, plant and equipment are stated at cost. Depreciation is computed on the straight-line
method over the estimated useful lives of the assets. The estimated useful lives for depreciation
of buildings is generally 20 to 30&nbsp;years, and the estimated useful lives of machinery and equipment
is generally three to ten years. Leasehold improvements are amortized over the shorter of the term
of the related lease or the life of the improvement. Long-lived assets are reviewed for impairment
whenever changes in circumstances or events may indicate that the carrying amounts may not be
recoverable. If the fair value is less than the carrying amount of the asset, a loss is recognized
for the difference.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->49<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Software Development Costs</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company capitalizes certain internal and external costs incurred to acquire or create
internal-use software in accordance with American Institute of Certified Public Accountants
Statement of Position 98-1, &#147;Accounting for the Costs of Computer Software Developed or Obtained
for Internal Use.&#148; Capitalized software costs are amortized on a straight-line basis over the
estimated useful life of the software, which is generally three to seven years.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Identifiable Intangible Assets</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company ascribes value to certain identifiable intangible assets, which primarily consist of
customer relationships and other intangible assets (consisting of non-competition agreements, a
long-term procurement agreement, customer databases, and sales backlog), as a result of
acquisitions. Identifiable intangible assets are included in &#147;Other assets&#148; in the company&#146;s
consolidated balance sheets. Amortization is computed on the straight-line method over their
estimated useful lives. The weighted average useful life of customer relationships is
approximately 12&nbsp;years. The useful life of other intangible assets ranges from one to five years.
Identifiable intangible assets are reviewed for impairment whenever changes in circumstances or
events may indicate that the carrying amounts may not be recoverable. If the fair value is less
than the carrying amount of the asset, a loss is recognized for the difference.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Investments</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Investments are accounted for using the equity method of accounting if the investment provides the
company the ability to exercise significant influence, but not control, over an investee.
Significant influence is generally deemed to exist if the company has an ownership interest in the
voting stock of the investee between 20% and 50%, although other factors, such as representation on
the investee&#146;s Board of Directors, are considered in determining whether the equity method of
accounting is appropriate. The company records its investments in equity method investees meeting
these characteristics as &#147;Investments in affiliated companies&#148; in the company&#146;s consolidated
balance sheets.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">All other equity investments, which consist of investments for which the company does not have the
ability to exercise significant influence, are accounted for under the cost method, if private, or
as available-for-sale, if public, and are included in &#147;Other assets&#148; in the company&#146;s consolidated
balance sheets. Under the cost method of accounting, investments are carried at cost and are
adjusted only for other-than-temporary declines in realizable value and additional investments. If
classified as available-for-sale, the company accounts for the changes in the fair value with
unrealized gains or losses reflected in the shareholders&#146; equity section in the company&#146;s
consolidated balance sheets in &#147;Other.&#148; The company assesses its long-term investments accounted
for as available-for-sale on a quarterly basis to determine whether declines in market value below
cost are other-than-temporary. When the decline is determined to be other-than-temporary, the cost
basis for the individual security is reduced and a loss is realized in the company&#146;s consolidated
statement of operations in the period in which it occurs. When the decline is determined to be
temporary, the unrealized losses are included in the shareholders&#146; equity section in the company&#146;s
consolidated balance sheets in &#147;Other.&#148; The company makes such determination based upon the quoted
market price, financial condition, operating results of the investee, and the company&#146;s intent and
ability to retain the investment over a period of time, which would be sufficient to allow for any
recovery in market value. In addition, the company assesses the following factors:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">broad economic factors impacting the investee&#146;s industry;</div></TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="4%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">publicly available forecasts for sales and earnings growth for the industry and
investee; and</div></TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">the cyclical nature of the investee&#146;s industry.</div></TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->50<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 10pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company could incur an impairment charge in future periods if, among other factors, the
investee&#146;s future earnings differ from currently available forecasts.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Cost in Excess of Net Assets of Companies Acquired </U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill represents the excess of the cost of an acquisition over the fair value of the assets
acquired. The company tests goodwill for impairment annually as of the first day of the fourth
quarter, and when an event occurs or circumstances change such that it is more likely than not that
an impairment may exist, such as (i)&nbsp;a significant adverse change in legal factors or in business
climate, (ii)&nbsp;an adverse action or assessment by a regulator, (iii)&nbsp;unanticipated competition, (iv)
a loss of key personnel, (v)&nbsp;a more-likely-than-not sale or disposal of all or a significant
portion of a reporting unit, (vi)&nbsp;the testing for recoverability of a significant asset group
within a reporting unit, or (vii)&nbsp;the recognition of a goodwill impairment loss of a subsidiary
that is a component of the reporting unit. In addition, goodwill is required to be tested for
impairment after a portion of the goodwill is allocated to a business targeted for disposal.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill is reviewed for impairment utilizing a two-step process. The first step of the impairment
test requires the identification of the reporting units and comparison of the fair value of each of
these reporting units to the respective carrying value. The company&#146;s reporting units are defined
as global ECS and each of the three regional businesses within the global components business
segment, which are North America, EMEASA, and Asia/Pacific. If the carrying value of the reporting
unit is less than its fair value, no impairment exists and the second step is not performed. If
the carrying value of the reporting unit is higher than its fair
value, the second step must be performed to compute the amount of the
goodwill impairment, if any.
In the second step, the impairment is computed by comparing the implied fair value of the
reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of the
reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is
recognized for the excess.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Historically, the company estimated the fair value of a reporting unit using a three-year weighted
average multiple of earnings before interest and taxes from comparable companies, which utilizes a
look-back approach. The assumptions utilized in the evaluation of the impairment of goodwill under
this approach include the identification of reporting units and the selection of comparable
companies, which are critical accounting estimates subject to change.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of significant declines in macroeconomic conditions, there has been a decline in global equity valuations since October&nbsp;1, 2008. Both of these factors have impacted
the company&#146;s market capitalization, and the company determined that it was prudent to supplement
its historical goodwill impairment testing methodology with a forward-looking discounted cash flow
methodology. The assumptions included in the discounted cash flow methodology included forecasted
revenues, gross profit margins, operating income margins, working capital cash flow, perpetual
growth rates, and long-term discount rates, among others, all of which require significant
judgments by management.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Foreign Currency Translation </U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The assets and liabilities of international operations are translated at the exchange rates in
effect at the balance sheet date, with the related translation gains or losses reported as a
separate component of shareholders&#146; equity in the company&#146;s consolidated balance sheets. The
results of international operations are translated at the monthly average exchange rates.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><U>Income Taxes</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Income taxes are accounted for under the liability method. Deferred taxes reflect the tax
consequences on future years of differences between the tax bases of assets and liabilities and
their financial reporting amounts. The carrying value of the company&#146;s deferred tax assets is
dependent upon the company&#146;s ability to generate sufficient future taxable income in certain tax
jurisdictions. Should the company
</DIV>


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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">determine that it is more likely than not that some portion or all of its deferred assets will not
be realized, a valuation allowance to the deferred tax assets would be established in the period
such determination was made.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">It is the company&#146;s policy to provide for uncertain tax positions and the related interest and
penalties based upon management&#146;s assessment of whether a tax benefit is more likely than not to be
sustained upon examination by tax authorities. At December&nbsp;31, 2008, the company believes it has
appropriately accounted for any unrecognized tax benefits. To the extent the company prevails in
matters for which a liability for an unrecognized tax benefit is established or is required to pay
amounts in excess of the liability, the company&#146;s effective tax rate in a given financial statement
period may be affected.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Net Income (Loss) Per Share</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Basic net income (loss)&nbsp;per share is computed by dividing net income (loss)&nbsp;available to common
shareholders by the weighted average number of common shares outstanding for the period. Diluted
net income per share reflects the potential dilution that would occur if securities or
other contracts to issue common stock were exercised or converted into common stock.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Comprehensive Income (Loss)</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Comprehensive income (loss)&nbsp;consists of net income (loss), foreign currency translation
adjustments, unrealized gains or losses on securities, and interest rate swaps designated as cash
flow hedges, in addition to other employee benefit plan items. Unrealized gains or losses on
securities are net of any reclassification adjustments for realized gains or losses included in
net income (loss). Except for unrealized gains or losses resulting from the company&#146;s
cross-currency swaps, foreign currency translation adjustments included in comprehensive income
(loss)&nbsp;were not tax effected as investments in international affiliates are deemed to be
permanent.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Stock-Based Compensation</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company records share-based payment awards exchanged for employee services at fair value on the
date of grant and expenses the awards in the consolidated statements of operations over the
requisite employee service period. Stock-based compensation expense includes an estimate for
forfeitures and is recognized over the expected term of the award on a straight-line basis. The
company recorded, as a component of selling, general and administrative expenses, amortization of
stock-based compensation of $18,092, $21,389, and $21,268 in 2008, 2007, and 2006, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Segment Reporting</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Operating segments are defined as components of an enterprise for which separate financial
information is available that is evaluated regularly by the chief operating decision maker in
deciding how to allocate resources and in assessing performance. The company&#146;s operations are
classified into two reportable business segments: global components and global enterprise computing
solutions (&#147;ECS&#148;).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Revenue Recognition</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company recognizes revenue in accordance with the Securities and Exchange Commission Staff
Accounting Bulletin No.&nbsp;104, &#147;Revenue Recognition&#148; (&#147;SAB 104&#148;). Under SAB 104, revenue is
recognized when there is persuasive evidence of an arrangement, delivery has occurred or services
are rendered, the sales price is determinable, and collectibility is reasonably assured. Revenue
typically is recognized at time of shipment. Sales are recorded net of discounts, rebates, and
returns, which historically were not material.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A portion of the company&#146;s business involves shipments directly from its suppliers to its
customers. In
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">these transactions, the company is responsible for negotiating price both with the supplier
and customer,
payment to the supplier, establishing payment terms with the customer, product
returns, and has risk of loss if the customer does not make payment. As the principal with the
customer, the company recognizes the sale and cost of sale of the product upon receiving
notification from the supplier that the product was shipped.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In addition, the company has certain business with select customers and suppliers that is accounted
for on an agency basis (that is, the company recognizes the fees associated with serving as an
agent in sales with no associated cost of sales) in accordance with Emerging Issues Task Force
(&#147;EITF&#148;) Issue No.&nbsp;99-19, &#147;Reporting Revenue Gross as a Principal versus Net as an Agent.&#148;
Generally, these transactions relate to the sale of supplier service contracts to customers where
the company has no future obligation to perform under these contracts or the rendering of logistics
services for the delivery of inventory for which the company does not assume the risks and rewards
of ownership.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Shipping and Handling Costs</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Shipping and handling costs included in selling, general and administrative expenses totaled
$73,617, $67,911, and $65,599 in 2008, 2007, and 2006, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Sabbatical Liability</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Effective January&nbsp;1, 2007, the company adopted EITF Issue No.&nbsp;06-2, &#147;Accounting for Sabbatical
Leave and Other Similar Benefits Pursuant to FASB Statement No.&nbsp;43,&#148; (&#147;EITF Issue No.&nbsp;06-2&#148;). EITF
Issue No.&nbsp;06-2 requires that compensation expense associated with a sabbatical leave, or other
similar benefit arrangements, be accrued over the requisite service period during which an employee
earns the benefit. Upon adoption, the company recognized a liability of $18,048 and a
cumulative-effect adjustment to retained earnings of $10,794, net of related taxes.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Impact of Recently Issued Accounting Standards</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In March&nbsp;2008, the FASB issued Statement of Financial Accounting Standards No.&nbsp;161, &#147;Disclosures
about Derivative Instruments and Hedging Activities&#148; (&#147;Statement No.&nbsp;161&#148;). Statement No.&nbsp;161
changes the disclosure requirements for derivative instruments and hedging activities. Entities
are required to provide disclosures about (a)&nbsp;how and why an entity uses derivative instruments,
(b)&nbsp;how derivative instruments and related hedged items are accounted for under FASB Statement No.
133, &#147;Accounting for Derivative Instruments and Hedging Activities,&#148; and its related
interpretations, and (c)&nbsp;how derivative instruments and related hedged items affect an entity&#146;s
financial position, results of operations, and cash flows. Statement No.&nbsp;161 is effective for
fiscal years and interim periods beginning after November&nbsp;15, 2008 and requires comparative
disclosures only for periods subsequent to initial adoption. The adoption of the provisions of
Statement No.&nbsp;161 will not impact the company&#146;s consolidated financial position and results of
operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007, the FASB issued Statement of Financial Accounting Standards No.&nbsp;141 (revised
2007), &#147;Business Combinations&#148; (&#147;Statement No.&nbsp;141(R)&#148;). Statement No.&nbsp;141(R) requires, among
other things, the acquiring entity in a business combination to recognize the fair value of all the
assets acquired and liabilities assumed; the recognition of acquisition-related costs in the
consolidated results of operations; the recognition of restructuring costs in the consolidated
results of operations for which the acquirer becomes obligated after the acquisition date; and
contingent purchase consideration to be recognized at their fair values on the acquisition date
with subsequent adjustments recognized in the consolidated results of operations. Statement No.
141(R) is effective for annual periods beginning after December&nbsp;15, 2008 and should be applied
prospectively for all business combinations entered into after the
date of adoption.</div>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007, the FASB issued Statement of Financial Accounting Standards No.&nbsp;160,
&#147;Noncontrolling Interests in Consolidated Financial Statements &#151; an amendment of ARB No.&nbsp;51&#148;
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->53<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">(&#147;Statement No.&nbsp;160&#148;). Statement No.&nbsp;160 requires that noncontrolling interests be reported as a
component of shareholders&#146; equity; net income attributable to the parent and the noncontrolling
interest be separately identified in the consolidated results of operations; changes in a parent&#146;s
ownership interest be treated as equity transactions if control is maintained; and upon a loss of
control, any gain or loss on the interest be recognized in the consolidated results of operations.
Statement No.&nbsp;160 also requires expanded disclosures to clearly identify and distinguish between
the interests of the parent and the interests of the noncontrolling owners. Statement No.&nbsp;160 is
effective for annual periods beginning after December&nbsp;15, 2008 and should be applied prospectively.
However, the presentation and disclosure requirements of the statement shall be applied
retrospectively for all periods presented. The adoption of the provisions of Statement No.&nbsp;160 is
not anticipated to materially impact the company&#146;s consolidated financial position and results of
operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Reclassification</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Certain prior year amounts were reclassified to conform to the current year presentation.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>2. Acquisitions</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following acquisitions were accounted for as purchase transactions and, accordingly, results of
operations were included in the consolidated results of the company from the dates of acquisition.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2008</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On June&nbsp;2, 2008, the company acquired LOGIX S.A. (&#147;LOGIX&#148;), a subsidiary of Groupe OPEN for a
purchase price of $205,937, which included $15,508 of debt paid at closing, cash acquired of
$3,647, and acquisition costs. In addition, there was the assumption of $46,663 in debt.
Headquartered in France, LOGIX has approximately 500 employees and is a leading value-added
distributor of midrange servers, storage, and software to over 6,500 partners in 11 European
countries. Total LOGIX sales for 2007 were approximately $600,000 (approximately <font face="times new roman,times">&#128;</font>440,000).
For 2008, LOGIX sales of $376,852 were included in the company&#146;s consolidated results of operations
from the date of acquisition.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">The following table summarizes the preliminary allocation of the net consideration paid to the fair
value of the assets acquired and liabilities assumed for the LOGIX acquisition:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts receivable, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&nbsp;115,778</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Inventories</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26,931</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,473</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Property, plant and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,234</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Identifiable intangible assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,262</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost in excess of net assets of companies acquired</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">183,333</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(95,697</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,654</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Debt (including short-term borrowings of $43,096)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(46,663</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(8,707</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash consideration paid, net of cash acquired</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&nbsp;202,290</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During the third quarter of 2008, the company completed its valuation of identifiable intangible
assets. The company allocated $21,401 of the purchase price to intangible assets relating to
customer relationships, with a useful life of 10&nbsp;years, and $1,861 to other intangible assets
(consisting of non-competition agreements and sales backlog), with useful lives ranging from one to
two years.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->54<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<Div style="font-family: helvetica,arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The preliminary allocation is subject to refinement as the company has not yet completed its final
evaluation of the fair value of all of the assets acquired and liabilities assumed.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The cost in excess of net assets of companies acquired related to the LOGIX acquisition was
recorded in the company&#146;s global ECS business segment. The intangible assets related to the LOGIX
acquisition are not expected to be deductible for income tax purposes.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the company&#146;s unaudited consolidated results of operations for 2008
and 2007, as well as the unaudited pro forma consolidated results of operations of the company, as
though the LOGIX acquisition occurred on January 1:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="14" style="border-bottom: 1px solid #000000"><B>For the Years Ended December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>As Reported</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>As Reported</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,761,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,968,023</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,590,101</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(621,702</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">406,501</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)&nbsp;per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.15</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.30</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.15</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.27</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The unaudited pro forma consolidated results of operations does not purport to be indicative of the
results obtained if the LOGIX acquisition had occurred as of the beginning of 2008 and 2007, or of
those results that may be obtained in the future.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In February&nbsp;2008, the company acquired all of the assets related to the franchise components
distribution business of Hynetic Electronics and Shreyanics Electronics (&#147;Hynetic&#148;). Hynetic is
based in India. Total Hynetic sales for 2007 were approximately $20,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In February&nbsp;2008, the company acquired all of the assets and operations of ACI Electronics LLC
(&#147;ACI&#148;), a distributor of electronic components used in defense and aerospace applications. ACI is
based in Denver, Colorado and distributed products in the United States, Israel, and Italy. Total
ACI sales for 2007 were approximately $60,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In July&nbsp;2008, the company acquired the components distribution business of Achieva Ltd.
(&#147;Achieva&#148;), a value-added distributor of semiconductors and electromechanical devices. Achieva is
based in Singapore and has a presence in eight countries within the Asia Pacific region. Total
Achieva sales for 2007 were approximately $210,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2008, the company acquired Excel Tech, Inc. (&#147;Excel Tech&#148;), the sole Broadcom
distributor in Korea, and Eteq Components Pte Ltd (&#147;Eteq Components&#148;), a Broadcom-based franchise
components distribution business in the ASEAN region and China. Total combined Excel Tech and Eteq
Components sales for 2007 were approximately $30,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The impact of the Hynetic, ACI, Achieva, Excel Tech, and Eteq Components acquisitions were not
material to the company&#146;s consolidated financial position and results of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2007</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On March&nbsp;31, 2007, the company acquired from Agilysys, Inc. (&#147;Agilysys&#148;) substantially all of the
assets and operations of their KeyLink Systems Group business (&#147;KeyLink&#148;) for a purchase price of
$480,640 in cash, which included acquisition costs and final adjustments based upon a closing
audit. The company also entered into a long-term procurement agreement with Agilysys. KeyLink, a
leading enterprise
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->55<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">computing solutions distributor, provides complex solutions from industry leading manufacturers to
more than 800 reseller partners. KeyLink has long-standing reseller relationships that provide the
company with significant cross-selling opportunities. KeyLink&#146;s highly experienced sales and
marketing professionals strengthen the company&#146;s existing relationships with value-added resellers
(&#147;VARs&#148;) and position the company to attract new relationships. Total KeyLink sales for 2006,
including estimated revenues associated with the above-mentioned procurement agreement, were
approximately $1,600,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the allocation of the net consideration paid to the fair value of
the assets acquired and liabilities assumed for the KeyLink acquisition:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts receivable, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">170,231</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Inventories</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47,100</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,893</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Property, plant and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,046</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Identifiable intangible assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">78,700</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost in excess of net assets of companies acquired</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">374,635</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(198,970</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,955</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,040</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net consideration paid</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">480,640</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During the first quarter of 2008, the company completed its valuation of identifiable intangible
assets. The company allocated $63,000 of the purchase price to intangible assets relating to
customer relationships, with a useful life of 11&nbsp;years, $12,000 to a long-term procurement
agreement, with a useful life of five years, and $3,700 to other intangible assets (consisting of
non-competition agreements and sales backlog), with a useful life of one year.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The cost in excess of net assets of companies acquired related to the KeyLink acquisition was
recorded in the company&#146;s global ECS business segment. Substantially all of the intangible assets
related to the KeyLink acquisition are expected to be deductible for income tax purposes.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the company&#146;s consolidated results of operations for 2007 and 2006,
as well as the unaudited pro forma consolidated results of operations of the company, as though the
KeyLink acquisition occurred on January 1:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="14" style="border-bottom: 1px solid #000000"><B>For the Years Ended December 31,</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>As Reported</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>As Reported</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,281,515</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,861,426</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">409,178</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">399,906</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.32</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.29</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.25</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The unaudited pro forma consolidated results of operations does not purport to be indicative of the
results obtained if the KeyLink acquisition had occurred as of the beginning of 2007 and 2006, or
of those results that may be obtained in the future, and does not include any impact from the
procurement agreement with Agilysys.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In June&nbsp;2007, the company acquired the component distribution business of Adilam Pty. Ltd.
(&#147;Adilam&#148;), a
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->56<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">leading electronic component distributor in Australia and New Zealand. Total Adilam sales for 2006
were approximately $18,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In September&nbsp;2007, the company acquired Centia Group Limited and AKS Group AB (&#147;Centia/AKS&#148;),
specialty distributors of access infrastructure, security and virtualization software solutions in
Europe. Total Centia/AKS sales for the full year of 2007 were approximately $130,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In November&nbsp;2007, the company acquired Universe Electron Corporation (&#147;UEC&#148;), a distributor of
semiconductor and multimedia products in Japan. Total UEC sales for the full year 2007 were
approximately $15,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The impact of the Adilam, Centia/AKS, and UEC acquisitions were not material to the company&#146;s
consolidated financial position and results of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2006</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On November&nbsp;30, 2006, the company acquired Alternative Technology, Inc. (&#147;Alternative Technology&#148;)
for a purchase price of $77,346, which included $17,483 of debt paid at closing, cash acquired of
$2,315, and acquisition costs. Additional cash consideration ranging from zero to a maximum of
$4,800 may be due if Alternative Technology achieves certain specified financial performance
targets over a three-year period from January&nbsp;1, 2007 through December&nbsp;31, 2009. Alternative
Technology, which is based in Englewood, Colorado, has approximately 150 employees and supports
VARs in delivering solutions that optimize, accelerate, monitor, and secure end-user&#146;s networks.
Total Alternative Technology sales for 2006 were approximately $250,000, of which $48,699 were
included in the company&#146;s consolidated results of operations from the acquisition date. The cash
consideration paid, net of cash acquired, was $75,031.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On December&nbsp;29, 2006, the company acquired InTechnology plc&#146;s storage and security distribution
business (&#147;InTechnology&#148;) for a purchase price of $80,457, which included acquisition costs.
InTechnology, which is based in Harrogate, England, has approximately 200 employees and delivers
storage and security solutions to VARs in the United Kingdom. Total InTechnology sales for 2006
were approximately $320,000.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the company&#146;s consolidated results of operations for 2006, as well
as the unaudited pro forma consolidated results of operations of the company, as though the
acquisitions of Alternative Technology and InTechnology occurred on January 1:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6"><B>For the Year Ended</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>December 31, 2006</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>As Reported</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,094,895</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">392,578</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.23</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The unaudited pro forma consolidated results of operations does not purport to be indicative of the
results obtained if the above acquisitions had occurred as of the beginning of 2006, or of those
results that may be obtained in the future.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In February&nbsp;2006, the company acquired SKYDATA Corporation (&#147;SKYDATA&#148;), a value-added distributor
of data storage solutions in Mississauga, Ottawa, and Calgary, as well as Laval, Quebec. Total
SKYDATA sales for 2005 were approximately $43,000. The impact of the SKYDATA acquisition was not
material to the company&#146;s consolidated financial position and results of operations.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->57<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Other</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Amortization expense related to identifiable intangible assets for the years ended December&nbsp;31,
2008, 2007, and 2006 was $15,324, $14,546, and $1,609, respectively. Amortization expense for each
of the years 2009 through 2013 are estimated to be approximately $14,971, $14,364, $13,822,
$12,022, and $11,422, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In July&nbsp;2007, the company made a payment of $32,685 that was capitalized as cost in excess of net
assets of companies acquired, partially offset by the carrying value of the related minority
interest, to increase its ownership interest in Ultra Source from 70.7% to 92.8%. In January&nbsp;2008,
the company made a payment of $8,699 to increase its ownership interest in Ultra Source to 100%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Additionally, during 2008 and 2006, the company made payments of $4,859 and $4,666, respectively,
which were capitalized as cost in excess of net assets of companies acquired, partially offset by
the carrying value of the related minority interest, to increase its ownership interest in other
majority-owned subsidiaries.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>3. Cost in Excess of Net Assets of Companies Acquired</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Cost in excess of net assets of companies acquired allocated to the company&#146;s business segments is
as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Global</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Components</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Global ECS</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,014,307</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">216,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,231,281</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Acquisitions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">460,235</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">481,735</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other (primarily foreign currency translation)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,442</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,777</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">66,219</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,091,249</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">687,986</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,779,235</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Acquisitions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">105,734</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">84,479</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">190,213</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Impairment charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(716,925</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(301,855</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,018,780</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other (primarily foreign currency translation)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(26,580</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(18,240</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(44,820</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">453,478</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">452,370</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">905,848</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill represents the excess of the cost on an acquisition over the fair value of the assets
acquired. The company tests goodwill for impairment annually as of the first day of the fourth
quarter, or more frequently if indicators of potential impairment exist.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill is reviewed for impairment utilizing a two-step process. The first step of the impairment
test requires the identification of the reporting units and comparison of the fair value of each of
these reporting units to the respective carrying value. The company&#146;s reporting units are defined
as global ECS and each of the three regional businesses within the global components business
segment, which are North America, EMEASA, and Asia/Pacific. If the carrying value of the reporting
unit is less than its fair value, no impairment exists and the second step is not performed. If
the carrying value of the reporting unit is higher than its fair
value, the second step must be performed to compute the amount of the
goodwill impairment, if any.
In the second step, the impairment is computed by comparing the implied fair value of the
reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of the
reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is
recognized for the excess.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->58<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Historically, the company estimated the fair value of a reporting unit using a three-year weighted
average multiple of earnings before interest and taxes from comparable companies, which utilizes a
look-back approach. The assumptions utilized in the evaluation of the impairment of goodwill under
this approach include the identification of reporting units and the selection of comparable
companies, which are critical accounting estimates subject to change. As of the first day of the fourth quarter of 2008, the
company&#146;s historical approach did not indicate impairment at any of the company&#146;s
reporting units.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As a result of significant declines in macroeconomic conditions, there has been a decline in global equity valuations since October&nbsp;1, 2008. Both of these factors have impacted the
company&#146;s market capitalization, and the company determined that it was prudent to supplement its
historical goodwill impairment testing methodology with a forward-looking discounted cash flow
methodology. The assumptions included in the discounted cash flow methodology included forecasted
revenues, gross profit margins, operating income margins, working capital cash flow, perpetual
growth rates, and long-term discount rates, among others, all of which require significant judgments
by management. The company also reconciled its discounted cash flow analysis to its current market
capitalization allowing for a reasonable control premium. Based upon
the results of the supplemental discounted cash flow approach, no impairment
existed as of October&nbsp;1, 2008. Based upon the results of the
 discounted
cash flow approach as of December&nbsp;31, 2008, the carrying value of the global
ECS reporting unit and the EMEASA and Asia/Pacific reporting units within the global components
business segment were higher than their fair value and, accordingly,
the company performed a step-two impairment analysis. The fair value
of the North America reporting unit within the global components
business segment was higher than its carrying value and a step-two
analysis was not required. The results of the step-two impairment analysis indicated that goodwill related
to the EMEASA and Asia/Pacific reporting units within the global components business segment were
fully impaired and the goodwill related to the global ECS business segment was partially impaired.
The company recognized a total non-cash impairment charge of
$1,018,780 ($905,069 net of related
taxes or $7.49 per share on both a basic and diluted basis) as of
December 31, 2008, of which
$716,925 related to the
company&#146;s global components business segment and $301,855 related to the company&#146;s global ECS
business segment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The
impairment charge did not impact the company&#146;s consolidated cash
flows, liquidity,  capital
resources, and covenants under its existing revolving credit facility, asset
securitization program, and other outstanding borrowings.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>4. Investments in Affiliated Companies</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has a 50% interest in several joint ventures with Marubun Corporation (collectively
&#147;Marubun/Arrow&#148;) and a 50% interest in Altech Industries (Pty.) Ltd. (&#147;Altech Industries&#148;), a
joint venture with Allied Technologies Limited. These investments are accounted for using the
equity method.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the company&#146;s investment in Marubun/Arrow, the company&#146;s investment
and long-term note receivable in Altech Industries, and the company&#146;s other equity investments at
December&nbsp;31:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="79%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Marubun/Arrow</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">34,881</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">31,835</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Altech Industries</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,782</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">177</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">46,788</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">47,794</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->59<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The equity in earnings (loss)&nbsp;of affiliated companies for the years ended December&nbsp;31 consists of
the following:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="72%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Marubun/Arrow</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,486</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,440</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,024</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Altech Industries</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,233</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,550</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,244</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(170</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(84</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(47</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,549</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,906</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,221</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Under the terms of various joint venture agreements, the company is required to pay its pro-rata
share of the third party debt of the joint ventures in the event that the joint ventures are
unable to meet their obligations. At December&nbsp;31, 2008, the company&#146;s pro-rata share of this debt
was approximately $11,750. The company believes there is sufficient equity in the joint ventures
to meet their obligations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>5. Accounts Receivable</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has a $600,000 asset securitization program collateralized by accounts receivables of
certain of its North American subsidiaries which expires in March&nbsp;2010. The asset securitization
program is conducted through Arrow Electronics Funding Corporation (&#147;AFC&#148;), a wholly-owned,
bankruptcy remote subsidiary. The asset securitization program does not qualify for sale treatment
under FASB Statement No.&nbsp;140, &#147;Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities.&#148; Accordingly, the accounts receivable and related debt obligation
remain on the company&#146;s consolidated balance sheet. Interest on borrowings is calculated using a
base rate or a commercial paper rate plus a spread, which is based on the company&#146;s credit ratings
(.225% at December&nbsp;31, 2008). The facility fee is .125%.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company had no outstanding borrowings under the program at December&nbsp;31, 2008 and 2007.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Accounts receivable, net, consists of the following at December&nbsp;31:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts receivable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,140,076</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,352,401</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Allowance for doubtful accounts</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(52,786</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(71,232</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounts receivable, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,087,290</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,281,169</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains allowances for doubtful accounts for estimated losses resulting from the
inability of its customers to make required payments. The allowances for doubtful accounts are
determined using a combination of factors, including the length of time the receivables are
outstanding, the current business environment, and historical experience.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>6. Debt</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">At December&nbsp;31, 2008 and 2007, short-term borrowings of $52,893 and $12,893, respectively, were
primarily utilized to support the working capital requirements of certain international operations.
The weighted average interest rates on these borrowings at December&nbsp;31, 2008 and 2007 were 3.6%
and 4.2%, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Long-term debt consists of the following at December&nbsp;31:
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->60<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">9.15% senior notes, due 2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">199,994</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">199,991</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Bank term loan, due 2012</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">6.875% senior notes, due 2013</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">349,694</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">349,627</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">6.875% senior debentures, due 2018</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">198,032</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197,822</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">7.5% senior debentures, due 2027</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197,331</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cross-currency swap, due 2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,467</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46,198</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cross-currency swap, due 2011</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,985</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,438</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest rate swaps designated as fair value hedges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,394</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,546</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other obligations with various interest rates and due dates</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,949</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,384</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,223,985</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,223,337</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The 7.5% senior debentures are not redeemable prior to their maturity. The 9.15% senior notes,
6.875% senior notes, and 6.875% senior debentures may be called at the option of the company
subject to &#147;make whole&#148; clauses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">The estimated fair market value at December&nbsp;31, as a percentage of par value, is as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">9.15% senior notes, due 2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">103</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">111</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">6.875% senior notes, due 2013</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">94</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">109</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">6.875% senior debentures, due 2018</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">80</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">106</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">7.5% senior debentures, due 2027</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">76</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">107</TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The carrying amount of the company&#146;s bank term loan, cross-currency swaps, interest rate swaps, and
other obligations approximate their fair value.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Annual payments of borrowings during each of the years 2009 through 2013 are $52,893, $247,715,
$11,506, $200,382, and $361,802, respectively, and $402,580 for all years thereafter.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has an $800,000 revolving credit facility with a group of banks that matures in January
2012. Interest on borrowings under the revolving credit facility is calculated using a base rate
or a euro currency rate plus a spread based on the company&#146;s credit ratings (.425% at December&nbsp;31,
2008). The company had no outstanding borrowings under the revolving credit facility at December
31, 2008 and 2007. The facility fee related to the revolving credit facility is .125%. The
company also entered into a $200,000 term loan with the same group of banks, which is repayable in
full in January&nbsp;2012. Interest on the term loan is calculated using a base rate or a euro currency
rate plus a spread based on the company&#146;s credit ratings (.60% at December&nbsp;31, 2008).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The revolving credit facility and the asset securitization program include terms and conditions
that limit the incurrence of additional borrowings, limit the company&#146;s ability to pay cash
dividends or repurchase stock, and require that certain financial ratios be maintained at
designated levels. The company was in compliance with all covenants as of December&nbsp;31, 2008. The
company is not aware of any events that would cause non-compliance in the future.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company redeemed the total amount outstanding of $283,184 principal amount
($156,354 accreted value) of its zero coupon convertible debentures due in 2021 (&#147;convertible
debentures&#148;) and repurchased $4,125 principal amount of its 7% senior notes due in January&nbsp;2007.
The related loss on the redemption and repurchase, including any related premium paid, write-off of
deferred
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->61<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">financing costs, and cost of terminating a portion of the related interest rate swaps,
aggregated $2,605 ($1,558 net of related taxes or $.01 per share on both a basic and diluted basis)
and was recognized as a loss on prepayment of debt. As a result of these transactions, net
interest expense was reduced by approximately $2,600 from the dates of redemption and repurchase
through the respective maturity dates, based on interest rates in effect at the time of the redemption and repurchase.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Interest expense, net, includes interest income of $5,337, $5,726, and $7,817 in 2008, 2007, and
2006, respectively. Interest paid, net of interest income, amounted to $96,993, $98,881, and
$105,078 in 2008, 2007, and 2006, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>7. Financial Instruments Measured at Fair Value</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Fair Value Measurements</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In September&nbsp;2006, the FASB issued Statement of Financial Accounting Standards No.&nbsp;157, &#147;Fair Value
Measurements&#148; (&#147;Statement No.&nbsp;157&#148;) which defines fair value, establishes a framework for measuring
fair value, and expands disclosures about fair value measurements. Statement No.&nbsp;157 applies to
other accounting pronouncements that require or permit fair value measurements and does not require
any new fair value measurements.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In February&nbsp;2008, the FASB issued FASB Staff Position 157-2, which provides for a one-year deferral
of the provisions of Statement No.&nbsp;157 for non-financial assets and liabilities that are recognized
or disclosed at fair value in the consolidated financial statements on a non-recurring basis. The
company is currently evaluating the impact of adopting the provisions of Statement No.&nbsp;157 for
non-financial assets and liabilities that are recognized or disclosed on a non-recurring basis.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Effective January&nbsp;1, 2008, the company adopted the provisions of Statement No.&nbsp;157 for financial
assets and liabilities, as well as for any other assets and liabilities that are carried at fair
value on a recurring basis. The adoption of the provisions of Statement No.&nbsp;157 related to
financial assets and liabilities and other assets and liabilities that are carried at fair value on
a recurring basis did not materially impact the company&#146;s consolidated financial position and
results of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Statement No.&nbsp;157 defines fair value as the exchange price that would be received for an asset or
paid to transfer a liability (an exit price) in the principal or most advantageous market for the
asset or liability in an orderly transaction between market participants on the measurement date.
Statement No.&nbsp;157 also establishes a fair value hierarchy, which requires an entity to maximize the
use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
Statement No.&nbsp;157 describes three levels of inputs that may be used to measure fair value:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="10%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="86%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Level 1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">Unadjusted quoted prices in active markets that are accessible at
the measurement date for identical, unrestricted assets or
liabilities.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Level 2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">Quoted prices in markets that are not active; or other inputs that
are observable, either directly or indirectly, for substantially
the full term of the asset or liability.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Level 3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">Prices or valuation techniques that require inputs that are both
significant to the fair value measurement and unobservable.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->62<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>


<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents assets/(liabilities) measured at fair value on a recurring basis at
December&nbsp;31, 2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="61%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Level 1</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Level 2</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Level 3</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Available-for-sale securities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">21,187</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">21,187</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cross-currency swaps</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(46,452</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(46,452</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest rate swaps</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,541</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,541</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">21,187</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(26,911</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5,724</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Available-For-Sale Securities </U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has a 3.1% equity ownership interest in WPG Holdings Co., Ltd. (&#147;WPG&#148;) and an 8.4%
equity ownership interest in Marubun Corporation (&#147;Marubun&#148;), which are accounted for as
available-for-sale securities.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The fair value of the company&#146;s available-for-sale securities are as follows at December&nbsp;31:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="58%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="6" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Marubun</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>WPG</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Marubun</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>WPG</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cost basis</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,016</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,798</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">20,046</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,798</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Unrealized holding gain (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">-</TD>
    <TD nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">373</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,212</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,160</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Fair value</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,016</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,171</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">18,834</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">27,958</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During
the fourth quarter of 2008, the company determined that an
other-than-temporary decline in the fair value of Marubun occurred
based upon various factors including the
financial condition and near-term prospects of Marubun, the magnitude of the loss compared to the
investment&#146;s cost, the length of time the investment was in an unrealized loss position, and
publicly available information about the industry and geographic
region in which Marubun operates and, accordingly recorded a loss of
$10,030 ($.08 per share on both a basic and diluted basis) on the
write-down of this investment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The fair value of these investments are included in &#147;Other assets&#148; in the company&#146;s consolidated
balance sheets, and the related net unrealized holding gains and losses are included in &#147;Other&#148; in
the shareholders&#146; equity section in the company&#146;s consolidated balance sheets.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Cross-Currency Swaps</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In May&nbsp;2006, the company entered into a cross-currency swap, with a maturity date of July&nbsp;2011, for
approximately $100,000 or &#128;&nbsp;78,281 (the &#147;2006 cross-currency swap&#148;) to hedge a portion of its net
investment in euro-denominated net assets. The 2006 cross-currency swap is designated as a net
investment hedge and effectively converts the interest expense on $100,000 of long-term debt from
U.S. dollars to euros. As the notional amount of the 2006 cross-currency swap is expected to equal
a comparable amount of hedged net assets, no material ineffectiveness is expected. The 2006
cross-currency swap had a negative fair value of $9,985 and $14,438 at December&nbsp;31, 2008 and 2007,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In October&nbsp;2005, the company entered into a cross-currency swap, with a maturity date of October
2010, for approximately $200,000 or &#128; 168,384 (the &#147;2005 cross-currency swap&#148;) to hedge a portion
of its net
investment in euro-denominated net assets. The 2005 cross-currency swap is designated as a net
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->63<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">investment hedge and effectively converts the interest expense on $200,000 of long-term debt from
U.S. dollars to euros. As the notional amount of the 2005 cross-currency swap is expected to equal
a comparable amount of hedged net assets, no material ineffectiveness is expected. The 2005
cross-currency swap had a negative fair value of $36,467 and $46,198 at December&nbsp;31, 2008 and 2007,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Interest Rate Swaps</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In December&nbsp;2007 and January&nbsp;2008, the company entered into a series of interest rate swaps (the
&#147;2007 and 2008 swaps&#148;) with a notional amount of $100,000. The 2007 and 2008 swaps modify the
company&#146;s interest rate exposure by effectively converting the variable rate (3.201% at December
31, 2008) on a portion of its $200,000 term loan to a fixed rate of 4.457% per annum through
December&nbsp;2009. The 2007 and 2008 swaps are designated as cash flow hedges and had a negative fair
value of $1,853 and $155 at December&nbsp;31, 2008 and 2007, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In June&nbsp;2004, the company entered into a series of interest rate swaps (the &#147;2004 swaps&#148;), with an
aggregate notional amount of $300,000. The 2004 swaps modify the company&#146;s interest rate exposure
by effectively converting the fixed 9.15% senior notes to a floating rate, based on the six-month
U.S. dollar LIBOR plus a spread (an effective rate of 8.19% and 9.50% at December&nbsp;31, 2008 and
2007, respectively), and a portion of the fixed 6.875% senior notes to a floating rate, also based
on the six-month U.S. dollar LIBOR plus a spread (an effective rate of 5.01% and 7.24% at December
31, 2008 and 2007, respectively), through their maturities. The 2004 swaps are designated as fair
value hedges and had a fair value of $21,394 and $7,546 at December&nbsp;31, 2008 and 2007,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Foreign Exchange Contracts</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company enters into foreign exchange forward, option, or swap contracts (collectively, the
&#147;foreign exchange contracts&#148;) to mitigate the impact of changes in foreign currency exchange rates,
primarily the euro. These contracts are executed to facilitate the hedging of foreign currency
exposures resulting from inventory purchases and sales and generally have terms of no more than six
months. Gains or losses on these contracts are deferred and recognized when the underlying future
purchase or sale is recognized or when the corresponding asset or liability is revalued. The
company does not enter into foreign exchange contracts for trading purposes. The risk of loss on a
foreign exchange contract is the risk of nonperformance by the counterparties, which the company
minimizes by limiting its counterparties to major financial institutions. The fair value of the
foreign exchange contracts is estimated using market quotes. The notional amount of the foreign
exchange contracts at December&nbsp;31, 2008 and 2007 was $315,021 and $262,940, respectively. The
carrying amounts, which are nominal, approximated fair value at December&nbsp;31, 2008 and 2007.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->64<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>8. Income Taxes</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The provision for income taxes for the years ended December&nbsp;31 consists of the following:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">

<TD><DIV style="margin-left:15px; text-indent:-15px"><B><u>Current</u></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Federal</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">55,459</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,077</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">92,842</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">State</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,510</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,410</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,159</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">International</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43,965</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57,549</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,889</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">104,934</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">172,036</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">137,890</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><u>Deferred</u></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Federal</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(33,232</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(11,892</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">State</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,892</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,124</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">953</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">International</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(53,088</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,543</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,506</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(88,212</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,661</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(9,433</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,722</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">180,697</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">128,457</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The principal causes of the difference between the U.S. federal statutory tax rate of 35% and
effective income tax rates for the years ended December&nbsp;31 are as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">United States</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,409</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">262,068</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">252,334</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">International</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(602,322</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">330,115</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">265,943</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Income before income taxes and minority interest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(596,913</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">592,183</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">518,277</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Provision at statutory tax rate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(208,919</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">207,264</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">181,397</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">State taxes, net of federal benefit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,352</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,047</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,073</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">International effective tax rate differential</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(28,801</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(54,448</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(24,492</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-deductible impairment charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">237,602</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other non-deductible expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,424</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,270</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,280</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Changes in tax accruals and reserves</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,188</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,838</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(40,426</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(124</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,274</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,375</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Provision for income taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,722</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">180,697</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">128,457</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During
the fourth quarter of 2008, the company recorded a reduction of the provision for income taxes of $8,450 and an
increase in interest expense of $1,009 ($962 net of related taxes) primarily related to the
settlement of certain international income tax matters covering multiple years.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2007, the company recorded an income tax benefit of $6,024, net, principally due to a
reduction in deferred income taxes as a result of the statutory tax rate change in Germany. These
deferred income taxes primarily related to the amortization of intangible assets for income tax
purposes, which are not amortized for accounting purposes.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">During 2006, the company settled certain income tax matters covering multiple years. As a result
of the settlement of the tax matters, the company recorded a reduction of the provision for income
taxes of
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->65<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">$46,176, of which $40,426 related to tax years prior to 2006, and recorded a reduction of
interest expense of $6,900 ($4,200 net of related taxes), of which $3,994 related to tax years
prior to 2006, in the company&#146;s consolidated statements of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Effective January&nbsp;1, 2007, the company adopted the provisions of FASB Interpretation No.&nbsp;48,
&#147;Accounting for Uncertainty in Income Taxes &#151; an interpretation of FASB Statement No.&nbsp;109&#148; (&#147;FIN
48&#148;). FIN 48 prescribes a recognition threshold and a measurement attribute for the financial
statement recognition and measurement of tax positions taken or expected to be taken in a tax
return. For those benefits to be recognized, a tax position must be more-likely-than-not to be
sustained upon examination by taxing authorities. There was not a material impact on the company&#146;s
consolidated financial position and results of operations as a result of the adoption of the
provisions of FIN 48. At December&nbsp;31, 2008, the company had a liability for unrecognized tax
benefits of $69,719 (of which $69,820, if recognized, would favorably affect the company&#146;s
effective tax rate). The company does not believe there will be any material changes in its
unrecognized tax positions over the next twelve months.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Interest costs related to unrecognized tax benefits are classified as a component of &#147;Interest
expense, net&#148; in the company&#146;s consolidated statements of operations. Penalties, if any, are
recognized as a component of &#147;Selling, general and administrative expenses.&#148; In 2008 and 2007, the
company recognized $1,476 and $4,149, respectively, of interest expense related to unrecognized tax
benefits. At December&nbsp;31, 2008 and 2007, the company had a liability for the payment of interest
of $11,634 and $10,395, respectively, related to unrecognized tax benefits.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years
ended December&nbsp;31 is as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at beginning of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">77,702</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">43,308</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Additions based on tax positions taken during a prior period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,179</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22,714</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reductions based on tax positions taken during a prior period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(19,446</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Additions based on tax positions taken during the current period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,943</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reductions based on tax positions taken during the current period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reductions related to settlement of tax matters</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,866</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,762</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reductions related to a lapse of applicable statute of limitations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(975</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(501</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Balance at end of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">69,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">77,702</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In many cases the company&#146;s uncertain tax positions are related to tax years that remain subject to
examination by tax authorities. The following describes the open tax years, by major tax
jurisdiction, as of December&nbsp;31, 2008:
</DIV>
<DIV align="left">
<TABLE  style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="70%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="53%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United States &#150; Federal
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2005 &#150; present
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United States &#150; State
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">1998 &#150; present
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Germany (a)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2007 &#150; present</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Hong Kong
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2001 &#150; present</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Italy (a)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2004 &#150; present</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Sweden
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2003 &#150; present</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United Kingdom
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">2006 &#150; present</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="text-align: justify">&nbsp;</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">(a)&nbsp;&nbsp;&nbsp;&nbsp;Includes federal as well as local jurisdictions.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Deferred income taxes are provided for the effects of temporary differences between the tax basis
of an asset or liability and its reported amount in the consolidated balance sheets. These
temporary differences result in taxable or deductible amounts in future years.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->66<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The significant components of the company&#146;s deferred tax assets and liabilities, included
primarily in &#147;Prepaid expenses and other assets,&#148; &#147;Other assets,&#148; and &#147;Other liabilities&#148; in the
company&#146;s consolidated balance sheets, consist of the following at December&nbsp;31:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Deferred tax assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net operating loss carryforwards</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">36,991</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">39,154</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Capital loss carryforwards</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,242</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,457</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Inventory adjustments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,037</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,335</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Allowance for doubtful accounts</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,917</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,232</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Accrued expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43,839</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,692</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other
compensation income items</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,096</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,135</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Derivative financial instruments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,225</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,981</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Restructuring and integration reserves</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,233</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,060</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Goodwill</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31,574</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,084</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,045</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">212,238</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">190,091</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Valuation allowance</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(27,068</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(34,814</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total deferred tax assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">185,170</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">155,277</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Deferred tax liabilities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Goodwill</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(60,887</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,734</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total deferred tax liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(63,621</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total net deferred tax assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">185,170</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">91,656</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:30px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">At December&nbsp;31, 2008, certain international subsidiaries had tax loss carryforwards of
approximately $129,773 expiring in various years after 2009. Deferred tax assets related to the
tax loss carryforwards of the international subsidiaries in the amount of $33,006 as of December
31, 2008 were recorded with a corresponding valuation allowance of $17,832. The impact of the
change in this valuation allowance on the effective rate reconciliation is included in the
international effective tax rate differential.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">At December&nbsp;31, 2008, the company had a capital loss carryforward of approximately $5,716. This
loss will expire through 2009. A full valuation allowance of $2,242 was provided against the
deferred tax asset relating to the capital loss carryforward.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Valuation allowances reflect the deferred tax benefits that management is uncertain of the ability
to utilize in the future.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Cumulative
undistributed earnings of international subsidiaries were $1,246,688 at December&nbsp;31,
2008. No deferred U.S. federal income taxes were provided for the undistributed earnings as they
are permanently reinvested in the company&#146;s international operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Income taxes paid, net of income taxes refunded, amounted to $144,215, $189,620, and $163,889 in
2008, 2007, and 2006, respectively.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->67<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>9.&nbsp;&nbsp;&nbsp;Restructuring and Integration Charges</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2008 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, the company recorded a restructuring and integration charge of $70,065 ($55,300 net of
related taxes or $.46 per share on both a basic and diluted basis). Included in the restructuring
and integration charge for 2008 is a restructuring charge of $69,836 related to initiatives by the
company to improve operating efficiencies. These actions are expected to reduce costs by
approximately $57,000 per annum, with approximately $17,000 realized in 2008. Also included in the
restructuring and integration charge for 2008 is a restructuring credit of $322 related to
adjustments to reserves previously established through restructuring charges in prior periods and
an integration charge of $551, primarily related to the ACI and KeyLink acquisitions.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the 2008 restructuring charge and activity in the related
restructuring accrual for 2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Asset</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Personnel</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Write-</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Costs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Facilities</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Downs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">39,383</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,305</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">25,423</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">725</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">69,836</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(24,238</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(474</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(225</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(24,937</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-cash usage</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(25,423</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(25,423</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reclassification of capital lease</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">810</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">810</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(949</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">78</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(871</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">19,415</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $69,836 in 2008 primarily includes personnel costs of $39,383, facility
costs of $4,305, and a write-down of a building and related land of $25,423. These initiatives are
the result of the company&#146;s continued efforts to lower cost and drive operational efficiency. The
personnel costs are primarily associated with the elimination of approximately 750 positions across
multiple functions and multiple locations. The facilities costs are related to the exit activities
of 9 vacated facilities in North America and Europe. During the fourth quarter of 2008, the
company&#146;s management approved a plan to actively market and sell a building and related land in
North America within the company&#146;s global components business segment acquired in 2000 in
connection with the acquisition of Wyle. The decision to exit this location was made to enable the
company to consolidate facilities and reduce future operating costs. The sale is expected to be
completed within the next twelve months. As a result of this action, the asset was designated as
an asset held for sale, in accordance with FASB Statement No.&nbsp;144, &#147;Accounting for the Impairment
or Disposal of Long-Lived Assets,&#148; and is included in &#147;Prepaid expenses and other assets&#148; on the
company&#146;s consolidated balance sheet as of December&nbsp;31, 2008. Upon the designation, the carrying
values of the building and related land were recorded at the lower of their carrying values or
their estimated fair values less cost to sell, and the company ceased recording depreciation. The
company wrote-down the carrying values of the building and related land by $25,423 to $9,500.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2007 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2007, the company recorded a restructuring and integration charge of $11,745 ($7,036 net of
related taxes or $.06 per share on both a basic and diluted basis). Included in the restructuring
and integration charge for 2007 is a restructuring charge of $9,708 related to initiatives by the
company to improve operating efficiencies, resulting in expected cost savings of approximately
$40,000 per annum. Also included in the restructuring and integration charge for 2007 is a
restructuring credit of $359 primarily related to the reversal of excess reserves, which were
previously established through restructuring
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->68<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">charges in prior periods, a gain on the sale of the
Lenexa, Kansas facility of $548 that was vacated in 2007 due to the company&#146;s continued efforts to
reduce real estate costs, and an integration charge of
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">$2,944 primarily related to the acquisition of KeyLink.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the 2007 restructuring charge and activity in the related
restructuring accrual for 2007 and 2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Personnel</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Costs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Facilities</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge (credit)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,312</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(1,947</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">343</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">9,708</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments/proceeds</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,563</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,896</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(258</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">75</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(133</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(71</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(138</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,815</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,816</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,645</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">586</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,126</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,807</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,245</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(14</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,066</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(129</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,286</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,415</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,825</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,290</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $9,708 in 2007 primarily includes personnel costs of $11,312 related to
the elimination of approximately 400 positions. These positions were primarily within the
company&#146;s global components business segment in North America and related to the company&#146;s
continued focus on operational efficiency. Facilities include a restructuring credit of $1,947,
primarily related to a gain on the sale of the Harlow, England facility of $8,506 that was vacated
in 2007. This was offset by facilities costs of $6,559, primarily related to exit activities for a
vacated facility in Europe due to the company&#146;s continued efforts to reduce real estate costs.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>2006 Restructuring and Integration Charge</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2006, the company recorded a restructuring and integration charge of $11,829 ($8,977 net of
related taxes or $.07 per share on both a basic and diluted basis). Included in the restructuring
and integration charge for 2006 is a restructuring charge of $12,280 related to initiatives by the
company to improve operating efficiencies, resulting in expected cost savings of approximately
$9,000 per annum. Also included in the restructuring and integration charge for 2006 is a
restructuring credit of $451 primarily related to the reversal of excess reserves, which were
previously established through restructuring charges in prior periods.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->69<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the 2006 restructuring charge and activity in the related
restructuring accrual for 2006, 2007, and 2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Asset</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Personnel</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Write-</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Costs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Facilities</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Downs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,542</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,228</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,484</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">26</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">12,280</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(4,305</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(624</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(26</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(4,955</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-cash usage</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(4,484</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(4,484</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(26</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(92</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(118</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,211</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">512</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,723</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring credit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(330</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(548</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(878</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,568</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,555</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">345</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">345</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring credit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(73</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(73</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(59</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(59</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">207</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">207</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The restructuring charge of $12,280 in 2006 includes personnel costs of $6,542 related to the
elimination of approximately 300 positions. These positions were primarily within the company&#146;s
global components business segment in North America and related to the outsourcing of certain
administrative functions and the closure of a warehouse facility. Facilities costs of $1,228 were
incurred related to exit activities of three vacated facilities in Europe due to the company&#146;s
continued efforts to reduce real estate costs. Also included in the restructuring charge is a
charge related to the write-down of certain capitalized software in Europe of $4,484. This
write-down resulted from the company&#146;s decision in the fourth quarter of 2006 to implement a global
Enterprise Resource Planning system, which caused these software costs to become redundant and have
no future benefit.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->70<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Restructuring Accrual Related to Actions Taken Prior to 2006</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the activity in the restructuring accrual during 2006, 2007, and 2008
related to actions taken prior to 2006:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Personnel</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Costs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Facilities</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,640</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,525</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,821</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,986</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge (credit)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(236</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,103</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(451</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,933</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,828</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">62</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(7,699</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(81</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(46</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(101</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">390</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,539</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,806</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,735</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring charge (credit)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(176</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,509</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,362</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(29</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(214</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,470</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,684</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">146</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">183</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">329</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,724</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,627</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,351</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Restructuring credit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(124</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,251</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,375</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,006</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,006</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-cash usage</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(201</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(201</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(181</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(76</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,413</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">280</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,693</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Integration</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Included in the restructuring and integration charges referenced above is an integration charge of
$551 for 2008, primarily related to the ACI and KeyLink acquisitions, and an integration charge of
$2,944 for 2007, primarily related to the acquisition of KeyLink.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents the integration charge and activity for 2006, 2007, and 2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Personnel</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Costs</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Facilities</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Total</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">24</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,370</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,768</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(295</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,682</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(838</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,815</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Reclassification</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">271</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(346</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">75</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-cash usage</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(59</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(59</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">448</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">499</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,735</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">658</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,393</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Integration costs (a)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,666</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(535</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,609</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,740</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,109</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(684</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(251</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,044</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">58</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">58</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">557</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,574</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,016</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,147</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Integration costs (b)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">774</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">435</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(323</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">886</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Payments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,091</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,186</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,277</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Foreign currency translation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">240</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">834</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,693</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3,767</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->71<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Integration costs of $3,740 in 2007 include $2,944 recorded as an integration charge and $796
recorded as additional costs in excess of net assets of companies acquired. The integration
costs include personnel costs of $1,666 associated with the elimination of approximately 50
positions in North America related to the acquisition of KeyLink, a credit of $535 primarily
related to the reversal of excess facility-related accruals in connection with certain
acquisitions made prior to 2005 and other costs of $2,609.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Integration costs of $886 in 2008 include $551 recorded as an integration charge and $335
recorded as additional costs in excess of net assets of companies acquired. Integration costs
primarily include personnel costs of $774 related to the elimination of 11 positions in North
America related to the ACI and KeyLink acquisitions and 1 position in Europe related to the
Centia/AKS acquisition. Integration costs also include costs related to a vacated facility in
Asia associated with the Achieva acquisition.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Restructuring and Integration Summary</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In summary, the restructuring and integration accruals aggregate $29,372 at December&nbsp;31, 2008, of
which $28,658 is expected to be spent in cash, and are expected to be utilized as follows:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The accruals for personnel costs of $15,108 to cover the termination of personnel are
primarily expected to be spent within one year.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The accruals for facilities totaling $10,791 relate to vacated leased properties that have
scheduled payments of $3,310 in 2009, $3,114 in 2010, $1,191 in 2011, $948 in 2012, $935 in
2013, and $1,293 thereafter.</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Other accruals of $3,473 are expected to be utilized over several years.</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>10. Shareholders&#146; Equity</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The activity in the number of shares outstanding is as follows (in thousands):
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Common</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Common</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Treasury</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Issued</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Outstanding</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Common stock outstanding at December&nbsp;31, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">272</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,014</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Restricted stock awards, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(65</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">65</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,339</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,339</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Other</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Common stock outstanding at December&nbsp;31, 2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">122,626</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">207</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">122,419</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,216</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,216</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Restricted stock and performance share awards, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(70</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">267</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Repurchases of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,075</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,075</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Common stock outstanding at December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125,039</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,212</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">122,827</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Exercise of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(167</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">175</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Restricted stock and performance share awards, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(146</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">147</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Repurchases of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,841</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3,841</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Common stock outstanding at December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125,048</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,740</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">119,308</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->72<!-- /Folio -->
</DIV>



<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has 2,000,000 authorized shares of serial preferred stock with a par value of one
dollar. There were no shares of serial preferred stock outstanding at December&nbsp;31, 2008 and 2007.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Share-Repurchase Programs</U></DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In February&nbsp;2006, the Board of Directors authorized the company to repurchase up to $100,000 of the
company&#146;s outstanding common stock through a share-repurchase program. In December&nbsp;2007, the Board
of Directors authorized the company to repurchase an additional $100,000 of the company&#146;s
outstanding common stock. As of December&nbsp;31, 2008, the company repurchased 5,916,596 shares under
these programs with a market value of $200,000 at the dates of repurchase.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>11. Net Income (Loss) Per Share</B></DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following table sets forth the calculation
of net income per share on a basic and diluted basis for the years ended December&nbsp;31 (shares in thousands):
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss), as reported</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">388,331</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Adjustment for interest expense on convertible debentures,
net of tax</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">524</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss), as adjusted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(613,739</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">407,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">388,855</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)&nbsp;per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.19</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Diluted (a)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(5.08</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">3.16</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD nowrap colspan="13">&nbsp;</TD>
</TR>


<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average shares outstanding-basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123,176</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">121,667</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net effect of various dilutive stock-based compensation awards</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,253</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,047</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net effect of dilutive convertible debentures</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">467</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average shares outstanding-diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">124,429</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123,181</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">The effect of options to purchase 4,368, 43, and 2 shares for the years ended December&nbsp;31,
2008, 2007, and 2006, respectively, was excluded from the calculation of net income (loss)&nbsp;per
share on a diluted basis as their effect was anti-dilutive.</div></TD>
</TR>

</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>12. Employee Stock Plans</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Omnibus Plan</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains the Arrow Electronics, Inc. 2004 Omnibus Incentive Plan (the &#147;Omnibus Plan&#148;),
which replaced the Arrow Electronics, Inc. Stock Option Plan, the Arrow Electronics, Inc.
Restricted Stock Plan, the 2002 Non-Employee Directors Stock Option Plan, the Non-Employee
Directors Deferral Plan, and the 1999 CEO Bonus Plan (collectively, the &#147;Prior Plans&#148;). The
Omnibus Plan broadens the array of equity alternatives available to the company when designing
compensation incentives. The Omnibus Plan permits the grant of cash-based awards, non-qualified
stock options, incentive stock options (&#147;ISOs&#148;), stock appreciation rights, restricted stock,
restricted stock units, performance shares, performance units, covered employee annual incentive
awards, and other stock-based awards. The
Compensation Committee of the company&#146;s Board of Directors (the &#147;Compensation Committee&#148;)
determines the vesting requirements, termination provision, and the terms of the award for any
awards under the Omnibus Plan when such awards are issued.
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->73<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Under the terms of the Omnibus Plan, a maximum of 13,300,000 shares of common stock may be awarded,
subject to adjustment. There were 6,957,960 and 3,549,067 shares available for grant under the
Omnibus Plan as of December&nbsp;31, 2008 and 2007, respectively. Shares currently subject to awards
granted under the Prior Plans, which cease to be subject to such awards for any reason other than
exercise for, or settlement in, shares will also be available under the Omnibus Plan. Generally,
shares are counted against the authorization only to the extent that they are issued. Restricted
stock, restricted stock units, and performance shares count against the authorization at a rate of
1.69 to 1.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">After adoption of the Omnibus Plan, there were no additional awards made under any of the Prior
Plans, though awards previously granted under the Prior Plans will survive according to their
terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Stock Options</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Under the Omnibus Plan, the company may grant both ISOs and non-qualified stock options. ISOs may
only be granted to employees, subsidiaries, and affiliates. The exercise price for options cannot
be less than the fair market value of Arrow&#146;s common stock on the date of grant. Options granted
under the Prior Plans become exercisable in equal installments over a four-year period, except for
stock options authorized for grant to directors, which become exercisable in equal installments
over a two-year period. Options currently outstanding have terms of ten years.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following information relates to the stock option activity for the year ended December&nbsp;31,
2008:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Weighted</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Weighted</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Average</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Average</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Remaining</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Aggregate</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Exercise</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Contractual</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Intrinsic</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Price</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Life</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Value</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10Pt">
    <TD><DIV style="margin-left:15px; text-indent:-15px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left"></TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Outstanding at December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,481,816</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">31.30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Granted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">484,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32.18</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Exercised</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(175,902</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24.72</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Forfeited</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(422,051</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33.80</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Outstanding at December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,367,941</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31.42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">80 months</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,374</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Exercisable at December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,267,139</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">65 months</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,374</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the
difference between the company&#146;s closing stock price on the last trading day of 2008 and the
exercise price, multiplied by the number of in-the-money options) that would have been received by
the option holders had all option holders exercised their options on December&nbsp;31, 2008. This
amount changes based on the market value of the company&#146;s stock.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The total intrinsic value of options exercised during 2008, 2007, and 2006 was $1,398, $30,739, and
$21,158, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Cash received from option exercises during 2008, 2007, and 2006 was $4,392, $55,228, and $59,194,
respectively, and is included within the financing activities section in the company&#146;s consolidated
statements of cash flows. The actual tax benefit realized from share-based payment awards during
2008, 2007, and 2006 was $3,551, $11,249, and $7,297, respectively.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->74<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The fair value of stock options was estimated using the Black-Scholes valuation model with the
following weighted-average assumptions for the years ended December&nbsp;31:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Volatility (percent) *</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Expected term (in years) **</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5.5</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3.6</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4.4</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Risk-free interest rate (percent) ***</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2.9</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4.6</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4.7</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Volatility is measured using historical daily price changes of the company&#146;s common stock
over the expected term of the option.</div></TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">**</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">The expected term represents the weighted average period the option is expected to be
outstanding and is based primarily on the historical exercise behavior of employees.</div></TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">***</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">The risk-free interest rate is based on the U.S. Treasury zero-coupon yield with a maturity
that approximates the expected term of the option.</div></TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">There is no expected dividend yield.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The weighted-average fair value per option granted was $11.63, $11.03, and $11.11 during 2008,
2007, and 2006, respectively.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Performance Shares</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The Compensation Committee, subject to the terms and conditions of the Omnibus Plan, may grant
performance unit and/or performance share awards. The fair value of a performance unit award is
the fair market value of the company&#146;s common stock on the date of grant. Such awards will be
earned only if performance goals over performance periods established by or under the direction of
the Compensation Committee are met. The performance goals and periods may vary from
participant-to-participant, group-to-group, and time-to-time. The performance shares will be
delivered in common stock at the end of the service period based on the company&#146;s actual
performance compared to the target metric and may be from 0% to 200% of the initial award.
Compensation expense is recognized on a straight-line basis over the service period, which is
generally three years and is adjusted each period based on the current estimate of performance
compared to the target metric.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Restricted Stock</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Subject to the terms and conditions of the Omnibus Plan, the Compensation Committee may grant
shares of restricted stock and/or restricted stock units. Restricted stock units are similar to
restricted stock except that no shares are actually awarded to the participant on the date of
grant. Shares of restricted stock and/or restricted stock units awarded under the Omnibus Plan may
not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end
of the applicable period of restriction established by the Compensation Committee and specified in
the award agreement (and in the case of restricted stock units until the date of delivery or other
payment). Compensation expense is recognized on a straight-line basis as shares become free of
forfeiture restrictions (i.e., vest) generally over a four-year period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Non-Employee Director Awards</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s Board of Directors (the &#147;Board&#148;) shall set the amounts and types of equity awards
that shall be granted to all non-employee directors on a periodic, nondiscriminatory basis pursuant
to the Omnibus Plan, as well as any additional amounts, if any, to be awarded, also on a periodic,
nondiscriminatory basis, based on each of the following: the number of committees of the Board on
which a non-employee director serves, service of a non-employee director as the chair of a
Committee of the Board, service of a non-employee director as Chairman of the Board or Lead
Director, or the first
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->75<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">selection or appointment of an individual to the Board as a non-employee
director. Non-employee
directors currently receive annual awards of restricted stock units valued at $60. The restricted
stock units will vest one year from date of grant and are subject to further restrictions until one
year following the director&#146;s separation from the Board. All restricted stock units are settled in
common stock after the restriction period.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Unless a non-employee director gives notice setting forth a different percentage, 50% of each
director&#146;s annual retainer fee is deferred and converted into units based on the fair market value
of the company&#146;s stock as of the date it was payable. Upon a non-employee director&#146;s retirement
from the Board, each unit in their deferral account will be converted into a share of company stock
and distributed to the non-employee director as soon as practicable following such date.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Summary of Non-Vested Shares</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The following information summarizes the changes in non-vested performance shares, restricted
stock, restricted stock units, and non-employee director awards for 2008:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Weighted</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Average</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Grant Date</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Fair Value</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-vested shares at December&nbsp;31, 2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">848,364</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">34.07</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Granted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">995,866</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32.04</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Vested</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(325,898</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28.49</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Forfeited</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(91,085</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34.93</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Non-vested shares at December&nbsp;31, 2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,427,247</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33.88</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As of December&nbsp;31, 2008, there was $13,092 of total unrecognized compensation cost related to
non-vested shares which is expected to be recognized over a weighted-average period of 2.5&nbsp;years.
The total fair value of shares vested during 2008, 2007, and 2006 was $10,313, $11,803, and $4,841,
respectively.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Stock Ownership Plan</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains a noncontributory employee stock ownership plan, which enables most North
American employees to acquire shares of the company&#146;s common stock. Contributions, which are
determined by the Board, are in the form of common stock or cash, which is used to purchase the
company&#146;s common stock for the benefit of participating employees. Contributions to the plan for
2008, 2007, and 2006 amounted to $11,290, $10,857, and $9,668, respectively.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>13. Employee Benefit Plans</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">On December&nbsp;31, 2006, the company adopted the provisions of FASB Statement No.&nbsp;158, &#147;Employers&#146;
Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB
Statements No.&nbsp;87, 88, 106, and 132(R)&#148; (&#147;Statement No.&nbsp;158&#148;), which required the company to
recognize the funded status of its defined benefit plans in the company&#146;s consolidated balance
sheet at December&nbsp;31, 2006, with the corresponding adjustment to accumulated other comprehensive
income, net of tax. The adjustment to accumulated other comprehensive income upon adoption
represents the net unrecognized actuarial losses, unrecognized prior service costs, and
unrecognized transition obligation remaining from the initial adoption of FASB Statement No.&nbsp;87,
&#147;Employers&#146; Accounting for Pensions&#148; (&#147;Statement No.&nbsp;87&#148;), which were previously netted against the
funded status in the company&#146;s consolidated balance sheets in accordance with the provisions of
Statement No.&nbsp;87.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->76<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008 and 2007, actuarial losses of $14,045 and $3,749, respectively, were recognized in
comprehensive income, net of related taxes. In 2008 and 2007, the following amounts were
recognized
as a reclassification adjustment of comprehensive income, net of related taxes, as a result of
being recognized in net periodic pension cost: transition obligation of $299 and $293,
respectively, prior service cost of $323 and $315, respectively, and an actuarial loss of $939 and
$1,274, respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Included in accumulated other comprehensive loss at December&nbsp;31, 2008 and 2007 are the following
amounts, net of related taxes, that have not yet been recognized in net periodic pension cost:
unrecognized transition obligation of $757 and $1,056, respectively, unrecognized prior service
costs of $289 and $612, respectively, and unrecognized actuarial losses of $31,950 and $18,844,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The transition obligation, prior service cost, and actuarial loss included in accumulated other
comprehensive loss, net of related taxes, which are expected to be recognized in net periodic
pension cost for the year ended December&nbsp;31, 2009 are $306, $323, and $2,312, respectively.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Supplemental Executive Retirement Plans (&#147;SERP&#148;) </U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company maintains an unfunded Arrow SERP under which the company will pay supplemental pension
benefits to certain employees upon retirement. There are 26 current and former corporate officers
participating in this plan. The Board determines those employees who are eligible to participate
in the Arrow SERP.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The Arrow SERP, as amended in 2002, provides for the pension benefits to be based on a percentage
of average final compensation, based on years of participation in the Arrow SERP. The Arrow SERP
permits early retirement, with payments at a reduced rate, based on age and years of service
subject to a minimum retirement age of 55. Participants whose accrued rights under the Arrow SERP,
prior to the 2002 amendment, which were adversely affected by the amendment, will continue to be
entitled to such greater rights.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company acquired Wyle Electronics (&#147;Wyle&#148;) in 2000. Wyle also sponsored an unfunded SERP for
certain of its executives. Benefit accruals for the Wyle SERP were frozen as of December&nbsp;31, 2000.
There are 19 participants in this plan.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->77<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company uses a December&nbsp;31 measurement date for the Arrow SERP and the Wyle SERP. Pension
information for the years ended December&nbsp;31 is as follows:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accumulated benefit obligation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">46,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">44,958</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Changes in projected benefit obligation:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Projected benefit obligation at beginning of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">53,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">49,103</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Service cost (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,587</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,651</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Interest cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,929</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,800</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Actuarial (gain)/loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,768</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,223</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Benefits paid</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,928</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(2,712</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Projected benefit obligation at end of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">53,885</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">53,065</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Funded status</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(53,885</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(53,065</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Components of net periodic pension cost:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Service cost (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,587</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">2,651</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Interest cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,929</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,800</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Amortization of net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">321</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">411</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Amortization of prior service cost (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">549</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">549</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Amortization of transition obligation (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">411</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">411</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net periodic pension cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,797</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,822</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average assumptions used to determine benefit obligation:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Discount rate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">6.00    </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.75   </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Rate of compensation increase (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.00  </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.00    </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average assumptions used to determine net periodic
pension cost:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Discount rate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.75   </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.75    </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Rate of compensation increase (Arrow SERP)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.00   </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.00   </TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The amounts reported for net periodic pension cost and the respective benefit obligation amounts
are dependent upon the actuarial assumptions used. The company reviews historical trends, future
expectations, current market conditions, and external data to determine the assumptions. The
discount rate represents the market rate for a high quality corporate bond. The rate of
compensation increase is determined by the company, based upon its long-term plans for such
increases. The actuarial assumptions used to determine the net periodic pension cost are based
upon the prior year&#146;s assumptions used to determine the benefit obligation.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->78<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">Benefit payments are expected to be paid as follows:
</DIV>

<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="50%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2009</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,587</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,517</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2011</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,601</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2012</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,573</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2013</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,611</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2014 - 2018</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,411</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Defined Benefit Plan</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Wyle provided retirement benefits for certain employees under a defined benefit plan. Benefits
under this plan were frozen as of December&nbsp;31, 2000 and former participants may now participate in
the company&#146;s employee stock ownership and 401(k) plans. The company uses a December&nbsp;31
measurement date for this plan. Pension information for the years ended December&nbsp;31 is as
follows:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accumulated benefit obligation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,077</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,494</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Changes in projected benefit obligation:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Projected benefit obligation at beginning of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,494</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">98,168</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Interest cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,769</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,441</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Actuarial (gain)/loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,033</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,957</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Benefits paid</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,153</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,072</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Projected benefit obligation at end of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,077</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">101,494</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Changes in plan assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Fair value of plan assets at beginning of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">81,364</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">79,875</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Actual return on plan assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(19,691</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,561</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Company contributions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,808</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">-</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Benefits paid</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,153</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(5,072</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Fair value of plan assets at end of year</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">62,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">81,364</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Funded status</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(38,749</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(20,130</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Components of net periodic pension cost:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Interest cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,769</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,441</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Expected return on plan assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6,830</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(6,546</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Amortization of net loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,552</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,209</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Net periodic pension cost</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">491</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">104</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average assumptions used to determine benefit obligation:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Discount rate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">6.00  </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">5.75   </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Expected return on plan assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">8.00   </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">8.50  </TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->79<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Weighted average assumptions used to determine net periodic pension cost:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Discount rate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.75  </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.75  </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Expected return on plan assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.50 </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.50   </TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The amounts reported for net periodic pension cost and the respective benefit obligation amounts
are dependent upon the actuarial assumptions used. The company reviews historical trends, future
expectations, current market conditions, and external data to determine the assumptions. The
discount rate represents the market rate for a high quality corporate bond. The expected return
on plan assets is based on current and expected asset allocations, historical trends, and expected
returns on plan assets. The actuarial assumptions used to determine the net periodic pension cost
are based upon the prior year&#146;s assumptions used to determine the benefit obligation.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company makes contributions to the plan so that minimum contribution requirements, as
determined by government regulations, are met. The company made contributions of $5,808 in 2008 and
expects to make estimated contributions in 2009 of $11,400.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">Benefit payments are expected to be paid as follows:
</DIV>

<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="50%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2009</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,960</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,091</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2011</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,126</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2012</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,222</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2013</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,357</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2014 - 2018</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,795</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">The plan asset allocations at December&nbsp;31 are as follows:
</DIV>

<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="60%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Equities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">52  </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">61   </TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Fixed income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Cash</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">100   </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">100   </TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The investment portfolio contains a diversified blend of common stocks, bonds, cash equivalents,
and other investments, which may reflect varying rates of return. The investments are further
diversified within each asset classification. The portfolio diversification provides protection
against a single security or class of securities having a disproportionate impact on aggregate
performance. The long-term target allocations for plan assets are 65% in equities and 35% in fixed
income, although the actual plan asset allocations may be within a range around these targets. The
actual asset allocations are reviewed and rebalanced on a periodic basis to maintain the target
allocations.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Defined Contribution Plan</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company has a defined contribution plan for eligible employees, which qualifies under Section
401(k) of the Internal Revenue Code. The company&#146;s contribution to the plan, which is based on a
specified percentage of employee contributions, amounted to $9,420, $8,783, and $7,967 in 2008,
2007, and 2006, respectively. Certain international subsidiaries maintain separate defined
contribution plans for their
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->80<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">employees and made contributions thereunder, which amounted to
$17,759, $11,113, and $6,593 in 2008, 2007, and 2006, respectively.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>14. Lease Commitments</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company leases certain office, distribution, and other property under non-cancelable operating
leases expiring at various dates through 2022. Rental expense under non-cancelable operating
leases, net of sublease income, amounted to $67,334, $60,173, and $54,790 in 2008, 2007, and 2006,
respectively.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Aggregate minimum rental commitments under all non-cancelable operating leases, exclusive of real
estate taxes, insurance, and leases related to facilities closed as a result of the integration of
acquired businesses and the restructuring of the company, are as follows:
</DIV>

<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="50%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2009</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">57,052</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2010</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43,678</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2011</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,986</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2012</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,820</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2013</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,657</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Thereafter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,460</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>15. Contingencies</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Preference Claim From 2001</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2008, an opinion was rendered in a bankruptcy proceeding (Bridge Information Systems, <I>et. anno</I>
v. Merisel Americas, Inc. &#038; MOCA) in favor of Bridge Information Systems (&#147;Bridge&#148;), the estate of
a former global ECS customer that declared bankruptcy in 2001. The proceeding is related to sales
made in 2000 and early 2001 by the MOCA division of ECS, a company Arrow purchased from Merisel
Americas in the fourth quarter of 2000. The court held that certain of the payments received by
the company at the time were preferential and must be returned to Bridge. Accordingly, during
2008, the company recorded a charge of $10,890 ($6,576 net of related taxes or $.05 per share on
both a basic and diluted basis), in connection with the preference claim from 2001, including legal
fees.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Tekelec Matters</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In 2000, the company purchased Tekelec Europe SA (&#147;Tekelec&#148;) from Tekelec Airtronic SA
(&#147;Airtronic&#148;) and certain other selling shareholders. Subsequent to the closing of the
acquisition, Tekelec received a product liability claim in the amount of <FONT face="'Times New Roman',times,serif">&#128;</FONT>11,333. The product
liability claim was the subject of a French legal proceeding started by the claimant in 2002, under
which separate determinations were made as to whether the products that are subject to the claim
were defective and the amount of damages sustained by the purchaser. The manufacturer of the
products also participated in this proceeding. The claimant has commenced legal proceedings against
Tekelec and its insurers to recover damages in the amount of <FONT face="'Times New Roman',times,serif">&#128;</FONT>3,742 and expenses of <FONT face="'Times New Roman',times,serif">&#128;</FONT>312 plus
interest.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Environmental and Related Matters</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Wyle Claims</B>

</DIV>
<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the 2000 purchase of Wyle from the VEBA Group (&#147;VEBA&#148;), the company assumed
certain of the then outstanding obligations of Wyle, including Wyle&#146;s 1994 indemnification of the
purchasers of its Wyle Laboratories division for environmental clean-up costs associated with any
then existing contamination or violation of environmental regulations. Under the terms of the
company&#146;s purchase of
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->81<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Wyle from VEBA, VEBA agreed to indemnify the company for costs associated
with the Wyle environmental indemnities, among other things. The company is aware of two Wyle
Laboratories facilities (in Huntsville, Alabama and Norco, California) at which contaminated
groundwater was identified. Each site will require remediation, the final form and cost of which
is undetermined.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Wyle Laboratories has demanded indemnification from the company with respect to the work at both
sites (and in connection with the litigation discussed below), and the company has, in turn,
demanded indemnification from VEBA. VEBA merged with a publicly&#151;traded, German conglomerate in
June&nbsp;2000.
The combined entity, now known as E.ON AG, remains responsible for VEBA&#146;s liabilities. E.ON AG
acknowledged liability under the terms of the VEBA contract in connection with the Norco and
Huntsville sites and made an initial, partial payment. Neither the company&#146;s demands for
subsequent payments nor its demand for defense and indemnification in the related litigation and
other costs associated with the Norco site were met.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Related Litigation</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In October&nbsp;2005, the company filed suit against E.ON AG in the Frankfurt am Main Regional Court in
Germany. The suit seeks indemnification, contribution, and a declaration of the parties&#146;
respective rights and obligations in connection with the Riverside County litigation (discussed
below) and other costs associated with the Norco site. That action is now proceeding.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company was named as a defendant in several suits related to the Norco facility, all of which
were consolidated for pre-trial purposes. In January&nbsp;2005, an action was filed in the California
Superior Court in Riverside County, California (Gloria Austin, <I>et al</I>. v. Wyle Laboratories, Inc. <I>et
al</I>.). Approximately 90 plaintiff landowners and residents sued a number of defendants under a
variety of theories for unquantified damages allegedly caused by environmental contamination at and
around the Norco site. Also filed in the Superior Court in Riverside County were Jimmy Gandara, <I>et
al. </I>v. Wyle Laboratories, Inc. <I>et al. </I>in January&nbsp;2006, and Lisa Briones <I>et al</I>. v. Wyle
Laboratories, Inc. <I>et al</I>. in May&nbsp;2006, both of which contain allegations similar to those in the
Austin case on behalf of approximately 20 additional plaintiffs. The Gandara matter has since been
resolved to the satisfaction of the parties, but the outcome of the Austin and Briones cases and
the amount of any associated liability are unknown.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company was also named as a defendant in a lawsuit filed in September&nbsp;2006 in the United States
District Court for the Central District of California (Apollo Associates, L.P., <I>et anno</I>, v. Arrow
Electronics, Inc. <I>et al.</I>) in connection with alleged contamination at a third site, an industrial
building formerly leased by Wyle Laboratories, in El Segundo, California. The lawsuit was settled,
though the possibility remains that government entities or others may attempt to involve the
company in further characterization or remediation of groundwater issues in the area.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Environmental Matters &#150; Huntsville</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Characterization of the extent of contaminated soil and groundwater continues at the site in
Huntsville, Alabama. Under the direction of the Alabama Department of Environmental Management,
approximately $1,800 was spent to date. The pace of the ongoing remedial investigations, project
management and regulatory oversight is likely to increase somewhat and though the complete scope of
the activities is not yet known, the company currently estimates additional investigative and
related expenditures at the site of approximately $350 to $2,000. The nature and scope of both
feasibility studies and subsequent remediation at the site has not yet been determined, but
assuming the outcome includes source control and certain other measures, the cost is estimated to
be between $2,500 and $4,000.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Environmental Matters &#150; Norco</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In October&nbsp;2003, the company entered into a consent decree among it, Wyle Laboratories and the
California Department of Toxic Substance Control (the &#147;DTSC&#148;) in connection with the Norco site.
In April
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->82<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">2005, a Remedial Investigation Work Plan was approved by DTSC that provided for site-wide
characterization of known and potential environmental issues. Investigations performed in
connection with this work plan and a series of subsequent technical memoranda continued until the
filing of a final Remedial Investigation Report early in 2008. The development of a final Remedial
Action Work Plan is ongoing. An estimated $24,000 was expended to date on project management,
regulatory oversight, and investigative and feasibility study activities.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Work is under way pertaining to the remediation of contaminated groundwater at certain areas on the
Norco site and of soil gas in a limited area immediately adjacent to the site. In the first
quarter of 2008, an hydraulic containment system was installed to capture and treat groundwater
before it moves into the adjacent offsite area. Approximately $6,000 was expended on remediation
to date, and it is anticipated that these activities, along with the initial phases of the
treatment of contaminated groundwater in the offsite area, will give rise to an additional
estimated $9,300 to $20,500.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Costs categories related to environmental activities at Norco include those for Project Management
and Regulatory Oversight, Remedial Investigations, Feasibility Studies, and Interim Remedial
Actions. Project Management and Regulatory Oversight include costs incurred by Wyle Laboratories
and project consultants for project management and costs billed by DTSC to provide regulatory
oversight.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company currently estimates that the additional cost of project management and regulatory
oversight will range from $1,000 to $2,000. Ongoing remedial investigations (including costs
related to soil and groundwater investigations), and the preparation of a final remedial
investigation report are projected to cost between $400 and $1,000. Remaining feasibility study and
Remedial Action Work Plan costs, including a final report and the design of remedial measures, are
estimated to cost $600 to $800.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Despite the amount of work undertaken and planned to date, the complete scope of work under the
consent decree is not yet known, and, accordingly, the associated costs have not yet been
determined.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Impact on Financial Statements</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes that any cost which it may incur in connection with environmental conditions
at the Norco, Huntsville, and El Segundo sites and the related litigation is covered by the
contractual indemnifications (except, under the terms of the environmental indemnification, for the
first $450), discussed above. The company believes that the recovery of costs incurred to date
associated with the environmental clean-up costs related to the Norco and Huntsville sites, is
probable. Accordingly, the company increased the receivable for amounts due from E.ON AG by $8,675
during 2008 to $33,619. The company&#146;s net costs for such indemnified matters may vary from period
to period as estimates of recoveries are not always recognized in the same period as the accrual of
estimated expenses. During 2006, the company recorded a charge of $1,449 ($867 net of related
taxes or $.01 per share on both a basic and diluted basis) related to the environmental matters
arising out of the company&#146;s purchase of Wyle.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Also included in the proceedings against E.ON AG is a claim for the reimbursement of
pre-acquisition tax liabilities of Wyle in the amount of $8,729 for which E.ON AG is also
contractually liable to indemnify the company. E.ON AG has specifically acknowledged owing the
company not less than $6,335 of such amounts, but its promises to make payments of at least that
amount were not kept. The company also believes that the recovery of these amounts is probable.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the acquisition of Wyle, the company acquired a $4,495 tax receivable due from
E.ON AG (as successor to VEBA) in respect of certain tax payments made by Wyle prior to the
effective date of the acquisition, the recovery of which the company also believes is probable.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As successor-in-interest to Wyle, the company is the beneficiary of the various Wyle insurance
policies that covered liabilities arising out of operations at Norco and Huntsville. Certain of
the carriers of the
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->83<!-- /Folio -->
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">primary insurance policies implicated in the pending claims have undertaken substantial portions of
the defense of the company in the Riverside County cases (Austin and Briones), and the company has
recovered approximately $10&nbsp;million from them to date. The company has sued certain of the
umbrella liability policy carriers, however, because they have yet to make payment on the tendered
losses.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company believes strongly in the merits of its positions regarding the E.ON AG indemnity, the
liabilities of the insurance carriers, and the absence of compensable damages to the Riverside
County plaintiffs.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><U>Other</U>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">From time to time, in the normal course of business, the company may become liable with respect to
other pending and threatened litigation, environmental, regulatory, and tax matters. While such
matters are subject to inherent uncertainties, it is not currently anticipated that any such
matters will materially impact the company&#146;s consolidated financial position, liquidity, or results
of operations.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>16. Segment and Geographic Information</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company is a global provider of products, services, and solutions to industrial and commercial
users of electronic components and enterprise computing solutions. The company distributes
electronic components to original equipment manufacturers and contract manufacturers through its
global components business segment and enterprise computing solutions to VARs through its global
ECS business segment. As a result of the company&#146;s philosophy of maximizing operating efficiencies
through the centralization of certain functions, selected fixed assets and related depreciation, as
well as borrowings, are not directly attributable to the individual operating segments and are
included in the corporate business segment.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Sales and operating income (loss), by segment, for the years ended December&nbsp;31 are as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10Pt">
    <TD><DIV style="margin-left:15px; text-indent:-15px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left"></TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Global components</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,319,482</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,223,751</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11,086,359</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Global ECS</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,441,527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,761,241</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,490,753</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Consolidated</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,761,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Operating income (loss):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Global components</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">533,126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">604,217</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">582,978</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Global ECS</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">196,269</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">202,223</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">123,653</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Corporate (a)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1,222,964</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(119,535</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(100,406</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Consolidated</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">(493,569</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">686,905</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">606,225</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes restructuring and integration charges of $70,065, $11,745, and $11,829 in 2008,
2007, and 2006, respectively. Also included in 2008 is a non-cash
impairment charge associated with goodwill of $1,018,780
and a charge of $10,890 related to the preference claim from 2001. Additionally, 2006
includes a charge related to a pre-acquisition warranty claim of $2,837 and a charge related
to pre-acquisition environmental matters arising out of the company&#146;s purchase of Wyle of
$1,449.</div></TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->84<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">






<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Total assets, by segment, at December&nbsp;31 are as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left"></TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left"></TD>
    <TD align="right"></TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Global components</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">4,093,118</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">5,230,728</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Global ECS</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,325,095</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,262,946</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Corporate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">700,072</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">566,186</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Consolidated</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,118,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,059,860</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Effective April&nbsp;1, 2008, deferred income taxes, which were previously included in corporate, were
allocated to global components, global ECS, and corporate. Prior period segment data was adjusted
to conform to current period presentation.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Sales, by geographic area, for the years ended December&nbsp;31 are as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2006</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">North America (b)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,366,124</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,565,247</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">6,846,468</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">EMEASA</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,392,805</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,970,585</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,348,484</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Asia/Pacific</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,002,080</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,449,160</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,382,160</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16,761,009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">15,984,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,577,112</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(b)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes sales related to the United States of $7,705,048, $7,962,526, and $6,337,169 in
2008, 2007, and 2006, respectively.</div></TD>
</TR>

</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Net property, plant and equipment,
geographic area, at December&nbsp;31 is as follows:</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>2007</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">North America (c)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">324,385</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">261,134</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">EMEASA</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,215</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">74,937</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Asia/Pacific</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,940</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,090</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">410,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">355,161</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(c)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes net property, plant and equipment related to the United States of $323,561 and
$259,948 in 2008 and 2007, respectively.</div></TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->85<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>17. Quarterly Financial Data (Unaudited)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A summary of the company&#146;s consolidated quarterly results of operations is as follows:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>First</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Second</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Third</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Fourth</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="CENTER" colspan="2" style="border-bottom: 1px solid #000000"><B>Quarter</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="CENTER" colspan="2" style="border-bottom: 1px solid #000000"><B>Quarter</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Quarter</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Quarter</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><U>2008</U></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,028,491</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,347,477</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,295,314</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,089,727</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Gross profit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">586,291</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">612,471</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">563,855</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">520,096</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">85,871      </TD>
    <TD nowrap>(b)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">96,215      </TD>
    <TD nowrap>(c)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">76,070      </TD>
    <TD nowrap>(d)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(871,895)</TD>
    <TD nowrap>(e)</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income (loss)&nbsp;per share (a):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.70      </TD>
    <TD nowrap>(b)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.79      </TD>
    <TD nowrap>(c)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.64      </TD>
    <TD nowrap>(d)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(7.30)</TD>
    <TD nowrap>(e)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.69      </TD>
    <TD nowrap>(b)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.79      </TD>
    <TD nowrap>(c)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.63      </TD>
    <TD nowrap>(d)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(7.30)              </TD>
    <TD nowrap>(e)</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><U>2007</U></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Sales</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,497,564</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,038,083</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,030,363</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,418,982</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Gross profit</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">539,631</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">578,970</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">552,557</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">614,119</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">96,294      </TD>
    <TD nowrap>(f)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">99,211      </TD>
    <TD nowrap>(g)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">98,324      </TD>
    <TD nowrap>(h)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">113,963               </TD>
    <TD nowrap>(i)</TD>
</TR>
<TR valign="bottom" style="font-size: 10pt"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net income per share (a):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.78      </TD>
    <TD nowrap>(f)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.80      </TD>
    <TD nowrap>(g)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.80      </TD>
    <TD nowrap>(h)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">.93               </TD>
    <TD nowrap>(i)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.77      </TD>
    <TD nowrap>(f)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.79      </TD>
    <TD nowrap>(g)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.79      </TD>
    <TD nowrap>(h)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">.92               </TD>
    <TD nowrap>(i)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Quarterly net income per share is calculated using the weighted average number of shares
outstanding during each quarterly period, while net income per share for the full year is
calculated using the weighted average number of shares outstanding during the year.
Therefore, the sum of the net income per share for each of the four quarters may not equal
the net income per share for the full year.</div></TD>
</TR>

<TR style="font-size: 10pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(b)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($4,159 net of related taxes or $.03 per
share on both a basic and diluted basis) and a charge related to the preference claim from
2001 ($7,822 net of related taxes or $.06 per share on both a basic and diluted basis).</div></TD>
</TR>

<TR style="font-size: 10pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(c)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($5,929 net of related taxes or $.05 per
share on both a basic and diluted basis).</div></TD>
</TR>

<TR style="font-size: 10pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(d)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($7,635 net of related taxes or $.06 per
share on both a basic and diluted basis).</div></TD>
</TR>

<TR style="font-size: 10pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(e)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a non-cash
impairment charge associated with goodwill ($905,069 net of related
taxes or $7.58 per
share on both a basic and diluted basis), a restructuring and integration charge ($37,577 net
of related taxes or $.31 per share on both a basic and diluted basis), a credit related
to the preference claim from 2001 ($1,246 net of related taxes or $.01 per share on both a
basic and diluted basis), and  a loss on the write-down of an investment
($10,030 net of related taxes or $.08 per share on both a basic and
diluted basis). Also includes a reduction of the provision for income taxes
($8,450 net of related taxes or $.07 per share on both a basic and diluted basis) and an
increase in interest expense ($962 net of related taxes or $.01 per share on both a basic and
diluted basis) primarily related to the settlement of certain international income tax
matters.</div></TD>
</TR>

<TR style="font-size: 10pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(f)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration credit ($4,522 net of related taxes or $.04 per
share on both a basic and diluted basis).</div></TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->86<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">






<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.<BR>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Dollars in thousands except per share data)</B>
</DIV>




<DIV style="margin-top: 3pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">(g)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($2,286 net of related taxes or $.02 per
share on both a basic and diluted basis).</div></TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(h)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($2,674 net of related taxes or $.02 per
share on both a basic and diluted basis) and an income tax benefit ($6,024 net of related
taxes or $.05 per share on both a basic and diluted basis) principally due to a reduction in
deferred income taxes as a result of the statutory tax rate change in Germany.</div></TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(i)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Includes a restructuring and integration charge ($6,598 net of related taxes or $.05 per
share on both a basic and diluted basis).</div></TD>
</TR>

</TABLE>
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">





<DIV align="left">
<A name="114"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;9. </B><U><B>Changes in and Disagreements with Accountants on Accounting and Financial Disclosure</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">None.
</DIV>
<DIV align="left">
<A name="115"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;9A. </B><U><B>Controls and Procedures</B></U><B>.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Disclosure Controls and Procedures</B>

</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s management, under the supervision and with the participation of the company&#146;s Chief
Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of
the design and operation of the company&#146;s disclosure controls and procedures as of December&nbsp;31,
2008 (the &#147;Evaluation&#148;). Based upon the Evaluation, the company&#146;s Chief Executive Officer and
Chief Financial Officer concluded that the company&#146;s disclosure controls and procedures (as defined
in Exchange Act Rule&nbsp;13a-15(e)) are effective.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Management&#146;s Report on Internal Control Over Financial Reporting</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s management is responsible for establishing and maintaining adequate &#147;internal control
over financial reporting&#148; (as defined in Exchange Act Rules&nbsp;13a-15(f) and 15d-15(f)). Management
evaluates the effectiveness of the company&#146;s internal control over financial reporting using the
criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in
Internal Control &#150; Integrated Framework. Management, under the supervision and with the
participation of the company&#146;s Chief Executive Officer and Chief Financial Officer, assessed the
effectiveness of the company&#146;s internal control over financial reporting as of December&nbsp;31, 2008,
and concluded that it is effective.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company acquired LOGIX S.A. (&#147;LOGIX&#148;) in June&nbsp;2008 and the components distribution business of
Achieva Ltd. (&#147;Achieva&#148;) in July&nbsp;2008. The company has excluded LOGIX and Achieva from its annual
assessment of and conclusion on the effectiveness of the company&#146;s internal control over financial
reporting. LOGIX and Achieva accounted for 6.2&nbsp;percent of total assets as of December&nbsp;31, 2008 and
2.5&nbsp;percent of the company&#146;s consolidated sales and less than 1&nbsp;percent of the company&#146;s
consolidated net loss for the year ended December&nbsp;31, 2008.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The company&#146;s independent registered public accounting firm, Ernst &#038; Young LLP, has audited the
effectiveness of the company&#146;s internal control over financial reporting as of December&nbsp;31, 2008,
as stated in their report, which is included herein.
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->88<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><B>REPORT OF ERNST &#038; YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The Board of Directors and Shareholders<BR>
Arrow Electronics, Inc.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We have audited Arrow Electronics, Inc.&#146;s (the &#147;company&#148;) internal control over financial reporting
as of December&nbsp;31, 2008, based on criteria established in
Internal Control&#150;Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission (the &#147;COSO
criteria&#148;). The company&#146;s management is responsible for maintaining effective internal control over
financial reporting, and for its assessment of the effectiveness of internal control over financial
reporting included in the accompanying Management&#146;s Report of Internal Control over Financial
Reporting. Our responsibility is to express an opinion on the company&#146;s internal control over
financial reporting based on our audit.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial reporting was
maintained in all material respects. Our audit included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness exists, testing and
evaluating the design and operating effectiveness of internal control based on the assessed risk,
and performing such other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">A company&#146;s internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles. A
company&#146;s internal control over financial reporting includes those policies and procedures that (1)
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2)&nbsp;provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company
are being made only in accordance with authorizations of management and directors of the company;
and (3)&nbsp;provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company&#146;s assets that could have a material effect on the
financial statements.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Because of its inherent limitations, internal control over financial reporting may not prevent or
detect misstatements. Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">As indicated in the accompanying Management&#146;s Report on Internal Control Over Financial Reporting,
management&#146;s assessment of and conclusion on the effectiveness of internal control over financial
reporting did not include the internal controls of LOGIX S.A. (&#147;LOGIX&#148;) and the components
distribution business of Achieva Ltd. (&#147;Achieva&#148;) acquired by the company during 2008, which were
included in the company&#146;s 2008 consolidated financial statements and constituted 6.2&nbsp;percent of
total assets as of December&nbsp;31, 2008 and 2.5 and less than 1&nbsp;percent of the sales and net loss,
respectively, for the year then ended. Our audit of internal control over financial reporting of
the company also did not include an evaluation of the internal control over financial reporting of
LOGIX and Achieva.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In our opinion, Arrow Electronics, Inc. maintained, in all material respects, effective internal
control over financial reporting as of December&nbsp;31, 2008, based on the COSO criteria<B>.</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We have also audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), the consolidated balance sheets of Arrow Electronics, Inc. as of December
31, 2008 and 2007, and the related consolidated statements of operations, shareholders&#146; equity, and
cash flows for each of the three years in the period ended December&nbsp;31, 2008 and our report dated
February&nbsp;24, 2009 expressed an unqualified opinion thereon.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt">/s/ ERNST &#038; YOUNG LLP<BR>New York, New York<BR>
February&nbsp;24, 2009

</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->89<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Changes in Internal Control Over Financial Reporting</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">There was no change in the company&#146;s internal control over financial reporting that occurred during
the company&#146;s most recent fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the company&#146;s internal control over financial reporting.
</DIV>
<DIV align="left">
<A name="116"></A>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;9B. </B><U><B>Other Information</B></U><B>.</B><BR>
<BR>
None.

</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->90<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">
<DIV align="left">
<A name="117"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>PART III</B>
</DIV>

<DIV align="left">
<A name="118"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;10. </B><U><B>Directors, Executive Officers, and Corporate Governance</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">See &#147;Executive Officers&#148; in Part&nbsp;I of this annual report on Form 10-K. In addition, the
information set forth under the headings &#147;Election of Directors&#148; and &#147;Section&nbsp;16(A) Beneficial
Ownership Reporting Compliance&#148; in the company&#146;s Proxy Statement, filed in connection with the
Annual Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, are incorporated herein by
reference.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Information about the company&#146;s audit committee financial experts set forth under the heading &#147;The
Board and its Committees&#148; in the company&#146;s Proxy Statement, filed in connection with the Annual
Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, is incorporated herein by reference.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Information about the company&#146;s code of ethics governing the Chief Executive Officer, Chief
Financial Officer, and Corporate Controller, known as the &#147;Finance Code of Ethics,&#148; as well as a
code of ethics governing all employees, known as the &#147;Worldwide Code of Business Conduct and
Ethics,&#148; is available free-of-charge on the company&#146;s website at <U>http://www.arrow.com</U> and is
available in print to any shareholder upon request.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Information about the company&#146;s &#147;Corporate Governance Guidelines&#148; and written committee charters
for the company&#146;s Audit Committee, Compensation Committee, and Corporate Governance Committee is
available free-of-charge on the company&#146;s website at <U>http://www.arrow.com</U> and is available in
print to any shareholder upon request.
</DIV>
<DIV align="left">
<A name="119"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;11. </B><U><B>Executive Compensation</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The information required by Item&nbsp;11 is included in the company&#146;s Proxy Statement filed in
connection with the Annual Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, and is
incorporated herein by reference.
</DIV>
<DIV align="left">
<A name="120"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;12. </B><U><B>Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The information required by Item&nbsp;12 is included in the company&#146;s Proxy Statement filed in
connection with the Annual Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, and is
incorporated herein by reference.
</DIV>
<DIV align="left">
<A name="121"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;13. </B><U><B>Certain Relationships and Related Transactions, and Director Independence</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The information required by Item&nbsp;13 is included in the company&#146;s Proxy Statement filed in
connection with the Annual Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, and is
incorporated herein by reference.
</DIV>
<DIV align="left">
<A name="122"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;14. </B><U><B>Principal Accounting Fees and Services</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">The information required by Item&nbsp;14 is included in the company&#146;s Proxy Statement filed in
connection with the Annual Meeting of Shareholders scheduled to be held on May&nbsp;1, 2009, and is
incorporated herein by reference.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->91<!-- /Folio -->
</DIV>


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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="left">
<A name="123"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>PART IV</B>
</DIV>

<DIV align="left">
<A name="124"></A>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;15. </B><U><B>Exhibits and Financial Statement Schedules</B></U><B>.</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">(a) The following documents are filed as part of this report:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">Page</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:32px; text-indent:-15px">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Statements.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#300"> Report of Ernst &#038; Young LLP, Independent Registered Public Accounting Firm</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">43</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#301"> Consolidated Statements of Operations for the years ended&nbsp;
December&nbsp;31, 2008, 2007, and 2006</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">44</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#302"> Consolidated Balance Sheets as of December&nbsp;31, 2008 and 2007</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">45</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#303"> Consolidated Statements of Cash Flows for the years ended&nbsp;
December&nbsp;31, 2008, 2007, and 2006</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">46</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#304"> Consolidated Statements of Shareholders&#146; Equity for the years ended&nbsp;
December&nbsp;31, 2008, 2007, and 2006</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">47</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#305"> Notes to Consolidated Financial Statements</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">49</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:32px; text-indent:-15px">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Statement Schedule.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:85px; text-indent:-15px"><A href="#306"> Schedule&nbsp;II &#150; Valuation and Qualifying Accounts</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">99</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:55px; text-indent:-0px">All other schedules are omitted since the required information is notpresent,
 or is not present in amounts sufficient to require submission of the schedule, or because the
information required is included in the consolidated financial statements, including the
 notes thereto.</DIV></TD>


    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:32px; text-indent:-15px">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exhibits.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:55px; text-indent:-15px">&nbsp;&nbsp;&nbsp;&nbsp;See Index of Exhibits included on pages 93 - 98</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->92<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>INDEX OF EXHIBITS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">2(a)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Share Purchase Agreement, dated as of August&nbsp;7, 2000, among
VEBA Electronics GmbH, EBV Verwaltungs GmbH i.L., Viterra
Grundstucke Verwaltungs GmbH, VEBA Electronics LLC, VEBA
Electronics Beteiligungs GmbH, VEBA Electronics (UK)&nbsp;Plc, Raab
Karcher Electronics Systems Plc and E.ON AG and Arrow
Electronics, Inc., Avnet, Inc., and Cherrybright Limited
regarding the sale and purchase of the VEBA electronics
distribution group (incorporated by reference to Exhibit&nbsp;2(i)
to the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2000, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(a)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Restated Certificate of Incorporation of the company, as
amended (incorporated by reference to Exhibit&nbsp;3(a) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 1994, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(a)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Certificate of Amendment of the Certificate of Incorporation
of Arrow Electronics, Inc., dated as of August&nbsp;30, 1996
(incorporated by reference to Exhibit&nbsp;3 to the company&#146;s
Quarterly Report on Form&nbsp;10-Q for the quarter ended September
30, 1996, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(a)(iii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Certificate of Amendment of the Restated Certificate of
Incorporation of the company, dated as of October&nbsp;12, 2000
(incorporated by reference to Exhibit&nbsp;3(a)(iii) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2000, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(b)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Amended Corporate By-Laws, dated July&nbsp;29, 2004 (incorporated
by reference to Exhibit&nbsp;3(ii) to the company&#146;s Quarterly
Report on Form&nbsp;10-Q for the quarter ended September&nbsp;30, 2004,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Indenture, dated as of January&nbsp;15, 1997, between the company
and the Bank of Montreal Trust Company, as Trustee
(incorporated by reference to Exhibit&nbsp;4(b)(i) to the company&#146;s
Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31,
1996, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Officers&#146; Certificate, as defined by the Indenture in 4(a)(i)
above, dated as of January&nbsp;22, 1997, with respect to the
company&#146;s $200,000,000 7% Senior Notes due 2007 and
$200,000,000 7 1/2% Senior Debentures due 2027 (incorporated
by reference to Exhibit&nbsp;4(b)(ii) to the company&#146;s Annual
Report on Form&nbsp;10-K for the year ended December&nbsp;31, 1996,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(iii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Officers&#146; Certificate, as defined by the indenture in 4(a)(i)
above, dated as of January&nbsp;15, 1997, with respect to the
$200,000,000 6 7/8% Senior Debentures due 2018, dated as of
May&nbsp;29, 1998 (incorporated by reference to Exhibit&nbsp;4(b)(iii)
to the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 1998, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(iv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="justify">Supplemental Indenture, dated as of February&nbsp;21, 2001, between
the company and The Bank of New York (as successor to the Bank
of Montreal Trust Company), as trustee (incorporated by
reference to Exhibit&nbsp;4.2 to the company&#146;s Current Report on
Form&nbsp;8-K, dated March&nbsp;12, 2001, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->93<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(v)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Supplemental Indenture, dated as of December&nbsp;31, 2001, between
the company and The Bank of New York (as successor to the Bank
of Montreal Trust Company), as trustee (incorporated by
reference to Exhibit&nbsp;4(b)(vi) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2001, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">4(a)(vi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Supplemental Indenture, dated as of March&nbsp;11, 2005, between
the company and The Bank of New York (as successor to the Bank
of Montreal Trust Company), as trustee (incorporated by
reference to Exhibit&nbsp;4(b)(vii) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2004, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(a)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics Savings Plan, as amended and restated on
January&nbsp;1, 2007 (incorporated by reference to Exhibit&nbsp;10(a) to
the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2006, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(b)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Wyle Electronics Retirement Plan, as amended and restated on
March&nbsp;17, 2003 (incorporated by reference to Exhibit&nbsp;10(b) to
the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2003, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(c)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics Stock Ownership Plan, as amended and
restated on January&nbsp;1, 2007 (incorporated by reference to
Exhibit&nbsp;10(a) to the company&#146;s Quarterly Report on Form&nbsp;10-Q
for the quarter ended March&nbsp;31, 2007, Commission File No.
1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics, Inc. 2004 Omnibus Incentive Plan as amended
February&nbsp;28, 2007 and February&nbsp;27, 2008 (incorporated by
reference to Exhibit&nbsp;10.1 to the company&#146;s Current Report on
Form&nbsp;8-K, dated May&nbsp;2, 2008, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Form of Stock Option Award Agreement (Senior Management) under
10(d)(i) above (incorporated by reference to Exhibit&nbsp;10-0 to
the company&#146;s Current Report on Form&nbsp;8-K, dated June&nbsp;23, 2005,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(iii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Form of Stock Option Award Agreement (Other) under 10(d)(i)
above (incorporated by reference to Exhibit&nbsp;10-1 to the
company&#146;s Current Report on Form&nbsp;8-K, dated June&nbsp;23, 2005,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(iv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Form of Stock Option Award Agreement under 10(d)(i) above
(incorporated by reference to Exhibit&nbsp;10-0 to the company&#146;s
Current Report on Form&nbsp;8-K, dated March&nbsp;23, 2006, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(v)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Form of Performance Share Award Agreement under 10(d)(i) above
(incorporated by reference to Exhibit&nbsp;10-0 to the company&#146;s
Current Report on Form&nbsp;8-K, dated August&nbsp;31, 2005, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(d)(vi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Form of Restricted Stock Award Agreement under 10(d)(i) above
(incorporated by reference to Exhibit&nbsp;10-0 to the company&#146;s
Current Report on Form&nbsp;8-K, dated September&nbsp;14, 2005,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(e)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics, Inc. Stock Option Plan, as amended and
restated effective February&nbsp;27, 2002 (incorporated by
reference to Exhibit&nbsp;10(d)(i) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2002, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->94<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(e)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Paying Agency Agreement, dated November&nbsp;11, 2003, by and
between Arrow Electronics, Inc. and Wachovia Bank, N.A.
(incorporated by reference to Exhibit&nbsp;10(d)(iii) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2003, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(f)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Restricted Stock Plan of Arrow Electronics, Inc., as amended
and restated effective February&nbsp;27, 2002 (incorporated by
reference to Exhibit&nbsp;10(e)(i) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2002, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(g)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">2002 Non-Employee Directors Stock Option Plan as of May&nbsp;23,
2002 (incorporated by reference to Exhibit&nbsp;10(f) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2002, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(h)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Non-Employee Directors Deferral Plan as of May&nbsp;15, 1997
(incorporated by reference to Exhibit&nbsp;99(d) to the company&#146;s
Registration Statement on Form&nbsp;S-8, Registration No.
333-45631).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics, Inc. Supplemental Executive Retirement
Plan, as amended effective January&nbsp;1, 2002 (incorporated by
reference to Exhibit&nbsp;10(h) to the company&#146;s Annual Report on
Form&nbsp;10-K for the year ended December&nbsp;31, 2002, Commission
File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(j)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Arrow Electronics, Inc. Executive Deferred Compensation Plan
as of October&nbsp;1, 2004 (incorporated by reference to Exhibit
10(j) to the company&#146;s Annual Report on Form&nbsp;10-K for the year
ended December&nbsp;31, 2005, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Employment Agreement, dated as of December&nbsp;30, 2008, by and
between the company and Michael J. Long.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Employment Agreement, dated as of December&nbsp;30, 2008, by and
between the company and Peter S. Brown.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(iii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Employment Agreement, dated as of December&nbsp;30, 2008, by and
between the company and Paul J. Reilly.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(iv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Employment Agreement, dated as of December&nbsp;30, 2008, by and
between the company and William E. Mitchell.</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(v)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Amendment, dated as of March&nbsp;16, 2005, to the Employment
Agreement dated as of February&nbsp;3, 2003, by and between the
company and William E. Mitchell (incorporated by reference to
Exhibit&nbsp;10.1 to the company&#146;s Current Report on Form&nbsp;8-K,
dated March&nbsp;18, 2005, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(vi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV align="JUSTIFY">Employment Agreement, dated as of December&nbsp;30, 2008, by and
between the company and John P. McMahon.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->95<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(vii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Form of agreement between the company and all corporate
officers, including the employees party to the Employment
Agreements listed in 10(k)(i)-(vi) above, providing extended
separation benefits under certain circumstances (incorporated
by reference to Exhibit&nbsp;10(c)(ix) to the company&#146;s Annual
Report on Form&nbsp;10-K for the year ended December&nbsp;31, 1988,
Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(viii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Form of agreement between the company and non-corporate
officers providing extended separation benefits under certain
circumstances (incorporated by reference to Exhibit&nbsp;10(c)(x)
to the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 1988, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(ix)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Grantor Trust Agreement, as amended and restated on November
11, 2003, by and between Arrow Electronics, Inc. and Wachovia
Bank, N.A. (incorporated by reference to Exhibit&nbsp;10(i)(xvii)
to the company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2003, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(k)(x)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">First Amendment, dated September&nbsp;17, 2004, to the amended and
restated Grantor Trust Agreement in 10(k)(xii) above by and
between Arrow Electronics, Inc. and Wachovia Bank, N.A.
(incorporated by reference to Exhibit&nbsp;10(a) to the company&#146;s
Quarterly Report on Form&nbsp;10-Q for the quarter ended September
30, 2004, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(l)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">9.15% Senior Exchange Notes due October&nbsp;1, 2010, dated as of
October&nbsp;6, 2000, among Arrow Electronics, Inc. and Goldman,
Sachs &#038; Co.; Chase Securities Inc.; Morgan Stanley &#038; Co.
Incorporated; Bank of America Securities LLC; Donaldson,
Lufkin &#038; Jenrette Securities Corporation; BNY Capital Markets,
Inc.; Credit Suisse First Boston Corporation; Deutsche Bank
Securities Inc.; Fleet Securities, Inc.; and HSBC Securities
(USA)&nbsp;Inc., as underwriters (incorporated by reference to
Exhibit&nbsp;4.4 to the company&#146;s Registration Statement on Form
S-4, Registration No.&nbsp;333-51100).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(l)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">6.875% Senior Exchange Notes due 2013, dated as of June&nbsp;25,
2003, among Arrow Electronics, Inc. and Goldman, Sachs &#038; Co.;
JPMorgan; and Bank of America Securities LLC, as joint
book-running managers; Credit Suisse First Boston, as lead
manager; and Fleet Securities, Inc.; HSBC, Scotia Capital; and
Wachovia Securities, as co-managers (incorporated by reference
to Exhibit&nbsp;99.1 to the company&#146;s Current Report on Form&nbsp;8-K
dated June&nbsp;25, 2003, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(m)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amended and Restated Five Year Credit Agreement, dated as of
January&nbsp;11, 2007, among Arrow Electronics, Inc. and certain of
its subsidiaries, as borrowers, the lenders from time to time
party thereto, JPMorgan Chase Bank, N.A., as administrative
agent, and Bank of America, N.A., The Bank of Nova Scotia, BNP
Paribas and Wachovia Bank National Association, as syndication
agents (incorporated by reference to Exhibit&nbsp;10(n) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 2006, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Transfer and Administration Agreement, dated as of March&nbsp;21,
2001, by and among Arrow Electronics Funding Corporation,
Arrow Electronics, Inc., individually and as Master Servicer,
the several Conduit Investors, Alternate Investors and Funding
Agents and Bank of America, National Association, as
administrative agent (incorporated by reference to Exhibit
10(m)(i) to the company&#146;s Annual Report on Form&nbsp;10-K for the
year ended December&nbsp;31, 2001, Commission File No.&nbsp;1-4482).</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->96<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;1 to the Transfer and Administration Agreement,
dated as of November&nbsp;30, 2001, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(m)(ii) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2001, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(iii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;2 to the Transfer and Administration Agreement,
dated as of December&nbsp;14, 2001, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(m)(iii) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2001, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(iv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;3 to the Transfer and Administration Agreement,
dated as of March&nbsp;20, 2002, to the Transfer and Administration
Agreement in (10)(n)(i) above (incorporated by reference to
Exhibit&nbsp;10(m)(iv) to the company&#146;s Annual Report on Form&nbsp;10-K
for the year ended December&nbsp;31, 2001, Commission File No.
1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(v)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;4 to the Transfer and Administration Agreement,
dated as of March&nbsp;29, 2002, to the Transfer and Administration
Agreement in (10)(n)(i) above (incorporated by reference to
Exhibit&nbsp;10(n)(v) to the company&#146;s Annual Report on Form&nbsp;10-K
for the year ended December&nbsp;31, 2002, Commission File No.
1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(vi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;5 to the Transfer and Administration Agreement,
dated as of May&nbsp;22, 2002, to the Transfer and Administration
Agreement in (10)(n)(i) above (incorporated by reference to
Exhibit&nbsp;10(n)(vi) to the company&#146;s Annual Report on Form&nbsp;10-K
for the year ended December&nbsp;31, 2002, Commission File No.
1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(vii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;6 to the Transfer and Administration Agreement,
dated as of September&nbsp;27, 2002, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(n)(vii) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2002, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(viii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;7 to the Transfer and Administration Agreement,
dated as of February&nbsp;19, 2003, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;99.1 to the company&#146;s Current Report on
Form&nbsp;8-K dated February&nbsp;6, 2003, Commission File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(ix)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;8 to the Transfer and Administration Agreement,
dated as of April&nbsp;14, 2003, to the Transfer and Administration
Agreement in (10)(n)(i) above (incorporated by reference to
Exhibit&nbsp;10(n)(ix) to the company&#146;s Annual Report on Form&nbsp;10-K
for the year ended December&nbsp;31, 2003, Commission File No.
1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(x)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;9 to the Transfer and Administration Agreement,
dated as of August&nbsp;13, 2003, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(n)(x) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2003, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV ALIGN="JUSTIFY">Amendment No.&nbsp;10 to the Transfer and Administration Agreement,
dated as of February&nbsp;18, 2004, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(n)(xi) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2003, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->97<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Exhibit</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;11 to the Transfer and Administration Agreement,
dated as of August&nbsp;13, 2004, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(b) to the company&#146;s Quarterly Report
on Form&nbsp;10-Q for the quarter ended September&nbsp;30, 2004,
Commission File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xiii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;12 to the Transfer and Administration Agreement,
dated as of February&nbsp;14, 2005, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(o)(xiii) to the company&#146;s Annual
Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2004,
Commission File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xiv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;13 to the Transfer and Administration Agreement,
dated as of February&nbsp;13, 2006, to the Transfer and
Administration Agreement in (10)(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(o)(xiv) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2005, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xv)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;14 to the Transfer and Administration Agreement,
dated as of October&nbsp;31, 2006, to the Transfer and
Administration Agreement in 10(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(o)(xv) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2006, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xvi)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;15 to the Transfer and Administration Agreement,
dated as of February&nbsp;12, 2007, to the Transfer and
Administration Agreement in 10(n)(i) above (incorporated by
reference to Exhibit&nbsp;10(o)(xvi) to the company&#146;s Annual Report
on Form&nbsp;10-K for the year ended December&nbsp;31, 2006, Commission
File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(n)(xvii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Amendment No.&nbsp;16 to the Transfer and Administration Agreement,
dated as of March&nbsp;27, 2007, to the Transfer and Administration
Agreement in 10(n)(i) above (incorporated by reference to
Exhibit&nbsp;10(b) to the company&#146;s Quarterly Report on Form&nbsp;10-Q
for the quarter ended March&nbsp;31, 2007, Commission File No.
1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">10(o)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Form of Indemnification Agreement between the company and each
director (incorporated by reference to Exhibit&nbsp;10(g) to the
company&#146;s Annual Report on Form&nbsp;10-K for the year ended
December&nbsp;31, 1986, Commission File No.&nbsp;1-4482).</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">21
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Subsidiary Listing.</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">23
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Consent of Independent Registered Public Accounting Firm.</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">31(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Certification of Chief Executive Officer Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002.</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">31(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Certification of Chief Financial Officer Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002.</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">32(i)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Certification of Chief Executive Officer Pursuant to 18 U.S.C.
Section&nbsp;1350, as Adopted Pursuant to Section&nbsp;906 of the
Sarbanes-Oxley Act of 2002.</div></td>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">32(ii)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><div align="justify">Certification of Chief Financial Officer Pursuant to 18 U.S.C.
Section&nbsp;1350, as Adopted Pursuant to Section&nbsp;906 of the
Sarbanes-Oxley Act of 2002.</div></td>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->98<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>ARROW ELECTRONICS, INC.</b></div>

<DIV align="left">
<A name="306"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 0pt"><b>SCHEDULE II &#151; VALUATION AND QUALIFYING ACCOUNTS<BR>
(In thousands)</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Balance at</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Charged</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Balance</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left">For the three years ended</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>beginning</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>to</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>Write-</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>at end</B></TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">

    <TD nowrap align="left" style="border-bottom: 0px solid #000000"> &nbsp;&nbsp;&nbsp;December 31,</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>of year</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>income</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>Other</B>(a)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>down</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000"><B>of year</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Allowance for doubtful accounts</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2008</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">71,232</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,866</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,787</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">41,099</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">52,786</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2007</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">75,404</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14,211</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">1,372</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">19,755</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">71,232</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">2006</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">47,076</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13,023</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">26,179</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">75,404</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
        <TD nowrap colspan="2" align="right" style="border-top: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 6pt; width: 18%; border-top: 0px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(a)</TD>
    <TD>&nbsp;</TD>
    <TD><DIV style="text-align: justify">Represents the allowance for doubtful accounts of the businesses acquired by the company
during 2008, 2007, and 2006.</DIV></TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->99<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">





<DIV align="left">
<A name="125"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt">SIGNATURES
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Pursuant to the requirements of Section&nbsp;13 or 15(d) 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.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="38%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">ARROW ELECTRONICS, INC.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/&nbsp;Peter S. Brown
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Peter S. Brown
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:15px; text-indent:-15px">Senior Vice President, General Counsel, and Secretary</div></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">February&nbsp;26, 2009</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed
below by the following persons on behalf of the registrant and in the capacities indicated on
February&nbsp;26, 2009:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="52%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ William E. Mitchell
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
William E. Mitchell, Chairman and
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Executive Officer</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Paul J. Reilly
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Paul J. Reilly, Senior Vice President and
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Financial Officer</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Michael A. Sauro
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Michael A. Sauro, Vice President and
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate Controller</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Daniel W. Duval
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Daniel W. Duval, Lead Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Gail E. Hamilton
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Gail E. Hamilton, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ John N. Hanson
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
John N. Hanson, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Richard S. Hill
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Richard S. Hill, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Fran Keeth
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Fran Keeth, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Roger King
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Roger King, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Michael J. Long
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Michael J. Long, Director, President and
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chief Operating Officer</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Karen Gordon Mills
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Karen Gordon Mills, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Stephen C. Patrick
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Stephen C. Patrick, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Barry W. Perry
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Barry W. Perry, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ John C. Waddell
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
John C. Waddell, Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->100<!-- /Folio -->
</DIV>



</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.K.I
<SEQUENCE>2
<FILENAME>y74529exv10wkwi.htm
<DESCRIPTION>EX-10.K.I: EMPLOYMENT AGREEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-10.K.I</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10(k)(i)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EMPLOYMENT AGREEMENT (the &#147;Agreement&#148;) made as of the 30th day of December&nbsp;2008 by and between
ARROW ELECTRONICS, INC., a New York corporation with its principal office at 50 Marcus Drive,
Melville, New York 11747 (the &#147;Company&#148;), and MICHAEL J. LONG, residing at 45590 Coal Creek Drive,
Parker, CO 80138 (the &#147;Executive&#148;).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Executive has been employed by the Company as President and Chief Operating
Officer, with the responsibilities and duties of an executive officer of the Company under an
Employment Agreement dated as of January&nbsp;1, 2001 (the &#147;Old Agreement&#148;); and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Old Agreement contains provisions that do not comply with section 409A of the
Internal Revenue Code of 1986, as amended, and applicable regulations thereunder (&#147;409A&#148;) and other
provisions that are obsolete; and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company and Executive wish to novate the Old Agreement and to replace it with
this Agreement;
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the
parties agree as follows:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Employment and Duties</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Employment</U>. The Company hereby employs the Executive for the Employment Period
defined in Paragraph&nbsp;3, to perform such duties for the Company, its subsidiaries and affiliates and
to hold such offices as may be specified from time to time by the Company&#146;s Board of Directors,
subject to the following provisions of this Agreement. The Executive hereby accepts such
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Duties and Responsibilities</U>. It is contemplated that the Executive will be
President and Chief Operating Officer of the Company, but the Board of Directors shall have the
right to adjust the duties, responsibilities, and title of the Executive as the Board of Directors
may from time to time deem to be in the interests of the Company (provided, however, that during
the Employment Period, without the consent of the Executive, he shall not be assigned any titles,
duties or responsibilities which, in the aggregate, represent a material diminution in, or are
materially inconsistent with, his prior title, duties, and responsibilities as President and Chief
Operating Officer).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Board of Directors does not either continue the Executive in the office of President
and Chief Operating Officer or elect him to some other executive office satisfactory to the
Executive, the Executive shall have the right to decline to give further service to the Company and
shall have the rights and obligations which would accrue to him under Paragraph&nbsp;6 if he were
discharged without cause. If the Executive decides to exercise such right to decline to give
further service, he shall within forty-five days after such action or omission by the Board of
Directors give written notice to the Company stating his objection and the action he thinks
necessary to correct it, and he shall permit the Company to have a forty-five day period in which
to correct its action or omission. If the Company makes a correction satisfactory to the
Executive, the Executive shall be obligated to continue to serve the Company. If the Company
does not make such a correction, the Executive&#146;s rights and obligations under Paragraph&nbsp;6
shall accrue at the expiration of such forty-five day period.
</DIV>



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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Time Devoted to Duties</U>. The Executive shall devote all of his normal business time
and efforts to the business of the Company, its subsidiaries and its affiliates, the amount of such
time to be sufficient, in the reasonable judgment of the Board of Directors, to permit him
diligently and faithfully to serve and endeavor to further their interests to the best of his
ability.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Compensation</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Monetary Remuneration and Benefits</U>. During the Employment Period, the Company
shall pay to the Executive for all services rendered by him in any capacity:
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. a minimum base salary of $330,000 per year (payable in accordance with the
Company&#146;s then prevailing practices, but in no event less frequently than in equal
monthly installments), subject to increase if the Board of Directors of the Company
in its sole discretion so determines; provided that, should the company institute a
company-wide pay cut/furlough program, such salary may be decreased by up to 15%,
but only for as long as said company-wide program is in effect;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. such additional compensation by way of salary or bonus or fringe benefits
as the Board of Directors of the Company in its sole discretion shall authorize or
agree to pay, payable on such terms and conditions as it shall determine; and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. such employee benefits that are made available by the Company to its other
executives generally.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Annual Incentive Payment</U>. The Executive shall participate in the Company&#146;s
Management Incentive Plan (or such alternative, successor, or replacement plan or program in which
the Company&#146;s principal operating executives, other than the Chief Executive Officer, generally
participate) and shall have a targeted incentive thereunder of not less than $270,000 per annum;
provided, however, that the Executive&#146;s actual incentive payment in any year shall be measured by
the Company&#146;s performance against goals established for that year and that such performance may
produce an incentive payment ranging from none to twice the targeted amount. The Executive&#146;s
incentive payment for any year will be appropriately pro-rated to reflect a partial year of
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Supplemental Executive Retirement Plan</U>. The Executive shall continue to
participate in the Company&#146;s Unfunded Pension Plan for Selected Executives (the &#147;SERP&#148;). The
timing of payment under the SERP shall be in accordance with its terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Automobile</U>. During the Employment Period, the Company will pay the Executive a
monthly automobile allowance of $800. Such allowance shall cease when the Executive&#146;s employment
with the Company terminates for any reason.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Expenses</U>. During the Employment Period, the Company agrees to reimburse the
Executive, upon the submission of appropriate vouchers, for out-of-pocket
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">expenses (including,
without limitation, expenses for travel, lodging and entertainment) incurred by the Executive in
the course of his duties hereunder in accordance with its expense reimbursement policy. Any
reimbursement that is taxable to Executive shall be paid no later than the end of the year
following the year in which it is incurred.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>Office and Staff</U>. The Company will provide the Executive with an office, secretary
and such other facilities as may be reasonably required for the proper discharge of his duties
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <U>Indemnification</U>. The Company agrees to indemnify the Executive for any and all
liabilities to which he may be subject as a result of his employment hereunder (and as a result of
his service as an officer or director of the Company, or as an officer or director of any of its
subsidiaries or affiliates), as well as the costs of any legal action brought or threatened against
him as a result of such employment, to the fullest extent permitted by law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <U>Participation in Plans</U>. Notwithstanding any other provision of this Agreement, the
Executive shall have the right to participate in any and all of the plans or programs made
available by the Company (or it subsidiaries, divisions or affiliates) to, or for the benefit of,
executives (including the annual stock option and restricted stock grant programs) or employees in
general, on a basis consistent with other senior executives.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>The Employment Period</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The &#147;Employment Period,&#148; as used in the Agreement, shall mean the period beginning as of the
date hereof and terminating on the last day of the calendar month in which the first of the
following occurs:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) the death of the Executive;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) the disability of the Executive as determined in accordance with Paragraph&nbsp;4 hereof and
subject to the provisions thereof;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) the termination of the Executive&#146;s employment by the Company for cause in accordance with
Paragraph&nbsp;5 hereof; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) December&nbsp;31, 2010; provided, however, that, unless sooner terminated as otherwise provided
herein, the Employment Period shall automatically be extended for one or more twelve (12)&nbsp;month
periods beyond the then scheduled expiration date thereof unless between the 18th and 12th month
preceding such scheduled expiration date either the Company or the Executive gives the other
written notice of its or his election not to have the Employment Period so extended.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Disability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the Executive will be deemed &#147;disabled&#148; if he is absent from
work because he is incapacitated due to an accident or physical or mental impairment, and one of the following conditions is also satisfied: (i) Executive is expected
to return to his duties with the Company within 6&nbsp;months after the beginning of his absence or (ii)
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Executive is unable to perform his duties or those of a substantially similar position of
employment due to a medically-determinable physical or mental impairment which can be expected to
result in death or last for a continuous period of not less than 6&nbsp;months. If the Executive is
absent on account of being disabled (as defined in the preceding sentence), during such absence the
Company shall continue to pay to the Executive his base salary, any additional compensation
authorized by the Company&#146;s Board of Directors, and other remuneration and benefits provided in
accordance with Paragraph&nbsp;2 hereof, all without delay, diminution or proration of any kind
whatsoever (except that his remuneration hereunder shall be reduced by the amount of any payments
he may otherwise receive as a result of his disability pursuant to a disability program provided by
or through the Company), and his medical benefits and life insurance shall remain in full force.
Unless terminated earlier in accordance with Paragraph&nbsp;3a), c) or d), the Employment Period shall
end on the 180<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> consecutive day of his disability absence, and Executive&#146;s compensation
under Paragraph&nbsp;2 shall immediately cease, except the medical benefits covering the Executive and
his family shall remain in place (subject to the eligibility requirements and other conditions
contained in the underlying plan, as described in the Company&#146;s employee benefits manual, and
subject to the requirement that the Executive continue to pay the &#147;employee portion&#148; of the cost
thereof), and the Executive&#146;s life insurance policy under the Management Insurance Program shall be
transferred to him, as provided in the related agreement, subject to the obligation of the
Executive to pay the premiums therefor.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Executive is determined to be capable of performing his duties before
being absent for 180 consecutive days (and before expiration of the Employment Period), the
Executive shall be entitled to resume employment with the Company under the terms of this Agreement
for the then remaining balance of the Employment Period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Termination for Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any malfeasance, willful misconduct, active fraud or gross negligence by the
Executive in connection with his employment hereunder, or a breach by the executive of any of the
Company&#146;s policies, the Company shall have the right to terminate the Employment Period by giving
the Executive notice in writing of the reason for such proposed termination. If the Executive
shall not have corrected such conduct to the satisfaction of the Company within thirty days after
such notice, the Employment Period shall terminate and the Company shall have no further obligation
to the Executive hereunder but the restriction on the Executive&#146;s activities contained in Paragraph
7 and the obligations of the Executive contained in Paragraphs 8(b) and 8(c) shall continue in
effect as provided therein.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Termination Without Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company discharges the Executive without cause, the Executive shall be
entitled to the following compensation during the remainder of the Employment Period (the length of
which shall be determined under Paragraph&nbsp;3d) unless sooner terminated by Executive&#146;s disability or
death): (i)&nbsp;the salary provided in Paragraph&nbsp;2a), payable in accordance with the usual payroll
schedule, (ii)&nbsp;two-thirds of the targeted incentive provided in Paragraph&nbsp;2b) for each year during
the Employment Period (or, on a pro rata basis, portion of
a year), payable on the normal payment date(s) for such incentive, (iii)&nbsp;the vesting of any
restricted stock awards and the immediate exercisability of any stock options which would have
</DIV>


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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">vested or become exercisable during the Employment Period, and (iv)&nbsp;continued participation in the
Company&#146;s medical plan under the same terms and conditions as an active employee, with eligibility
for continuation coverage for Executive and his eligible dependents under the plan&#146;s COBRA
provisions at the end of the Employment Period at Executive&#146;s own expense. However, participation
in the Company&#146;s 401(k) plan, ESOP and all welfare and fringe benefit plans (other than the medical
plan) will cease on the Executive&#146;s last day of active work, subject to any conversion rights
generally available to former employees. Any amounts payable to the Executive under this Paragraph
6 shall be reduced by the amount of the Executive&#146;s earnings from other employment (which the
Executive shall have an affirmative duty to seek; provided, however, that the Executive shall not
be obligated to accept a new position which is not reasonably comparable to his employment with the
Company).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, if the Executive is a &#147;specified employee&#148; for purposes of
409A, no deferred compensation (including without limitation salary continuation payments in
accordance with clause (i)&nbsp;above) payable at separation from service that is not exempt from
application of 409A as a short term deferral or separation pay will be paid to Executive during the
6-month period immediately following the day he ceases active work for the Company, and any such
payments otherwise due during such 6-month period shall be paid on the first business day following
completion of such 6-month period along with simple interest at the six-month Treasury rate in
effect at the beginning of such 6-month period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Non-Competition; Trade Secrets</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Employment Period and for a period of one year after the termination of the
Employment Period, the Executive will not, directly or indirectly:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Disclosure of Information</U>. Use, attempt to use, disclose or otherwise make known
to any person or entity (other than to the Board of Directors of the Company or otherwise in the
course of the business of the Company, its subsidiaries or affiliates and except as may be required
by applicable law):
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. any knowledge or information, including, without limitation, lists of
customers or suppliers, trade secrets, know-how, inventions, discoveries, processes
and formulae, as well as all data and records pertaining thereto, which he may
acquire in the course of his employment, in any manner which may be detrimental to
or cause injury or loss to the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. any knowledge or information of a confidential nature (including all
unpublished matters) relating to, without limitation, the business, properties,
accounting, books and records, trade secrets or memoranda of the Company, its
subsidiaries or affiliates, which he now knows or may come to know in any manner
which may be detrimental to or cause injury or loss to the Company, its subsidiaries
or affiliates;
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Non-Competition</U>. Engage or become interested in the United States, Canada or
Mexico (whether as an owner, shareholder, partner, lender or other investor, director,
</DIV>



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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">officer, employee, consultant or otherwise) in the business of distributing electronic parts, components,
supplies or systems, or any other business that is competitive with the principal business or
businesses then conducted by the Company, its subsidiaries or affiliates (provided, however, that
nothing contained herein shall prevent the Executive from acquiring or owning less than 1% of the
issued and outstanding capital stock or debentures of a corporation whose securities are listed on
the New York Stock Exchange, American Stock Exchange, or the National Association of Securities
Dealers Automated Quotation System, if such investment is otherwise permitted by the Company&#146;s
Human Resource and Conflict of Interest policies);
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Solicitation</U>. Solicit or participate in the solicitation of any business of any
type conducted by the Company, its subsidiaries or affiliates, during said term or thereafter, from
any person, firm or other entity which was or at the time is a supplier or customer, or prospective
supplier or customer, of the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Employment</U>. Employ or retain, or arrange to have any other person, firm or other
entity employ or retain, or otherwise participate in the employment or retention of, any person who
was an employee or consultant of the Company, its subsidiaries or affiliates, at any time during
the period of twelve consecutive months immediately preceding such employment or retention.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive will promptly furnish in writing to the Company, its subsidiaries or affiliates,
any information reasonably requested by the Company (including any third party confirmations) with
respect to any activity or interest the Executive may have in any business.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly herein provided, nothing contained herein is intended to prevent the
Executive, at any time after the termination of the Employment Period, from either (i)&nbsp;being
gainfully employed or (ii)&nbsp;exercising his skills and abilities outside of such geographic areas,
provided in either case the provisions of this Agreement are complied with.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Preservation of Business</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>General</U>. During the Employment Period, the Executive will use his best efforts to
advance the business and organization of the Company, its subsidiaries and affiliates, to keep
available to the Company, its subsidiaries and affiliates, the services of present and future
employees and to advance the business relations with its suppliers, distributors, customers and
others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Patents and Copyrights, etc.</U> The Executive agrees, without additional
compensation, to make available to the Company all knowledge possessed by him relating to any
methods, developments, inventions, processes, discoveries and/or improvements (whether patented,
patentable or unpatentable) which concern in any way the business of the Company, its subsidiaries
or affiliates, whether acquired by the Executive before or during his employment hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any methods, developments, inventions, processes, discoveries and/or improvements (whether
patented, patentable or unpatentable) which the Executive may conceive of or make, related directly
or indirectly to the business or affairs of the Company, its
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">subsidiaries or affiliates, or any
part thereof, during the Employment Period, shall be and remain the property of the Company. The
Executive agrees promptly to communicate and disclose all such methods, developments, inventions,
processes, discoveries and/or improvements to the Company and to execute and deliver to it any
instruments deemed necessary by the Company to effect the disclosure and assignment thereof to it.
The Executive also agrees, on request and at the expense of the Company, to execute patent
applications and any other instruments deemed necessary by the Company for the prosecution of such
patent applications or the acquisition of Letters Patent in the United States or any other country
and for the assignment to the Company of any patents which may be issued. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of having made such patent applications or being granted such
patents.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any writings or other materials written or produced by the Executive or under his supervision
(whether alone or with others and whether or not during regular business hours), during the
Employment Period which are related, directly or indirectly, to the business or affairs of the
Company, its subsidiaries or affiliates, or are capable of being used therein and the copyright
thereof, common law or statutory, including all renewals and extensions, shall be and remain the
property of the Company. The Executive agrees promptly to communicate and disclose all such
writings or materials to the Company and to execute and deliver to it any instruments deemed
necessary by the Company to effect the disclosure and assignment thereof to it. The Executive
further agrees, on request and at the expense of the Company, to take any and all action deemed
necessary by the Company to obtain copyrights or other protections for such writings or other
materials or to protect the Company&#146;s right, title and interest therein. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of the Executive&#146;s compliance with the Company&#146;s request.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Return of Documents</U>. Upon the termination of the Employment Period, including any
termination of employment described in Paragraph&nbsp;6, the Executive will promptly return to the
Company all copies of information protected by Paragraph 7(a) hereof or pertaining to matters
covered by subparagraph (b)&nbsp;of this Paragraph&nbsp;8 which are in his possession, custody or control
whether prepared by him or others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Separability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive agrees that the provisions of Paragraphs 7 and 8 hereof constitute independent
and separable covenants which shall survive the termination of the Employment Period and which
shall be enforceable by the Company notwithstanding any rights or remedies the Executive may have
under any other provisions hereof. The Company agrees that the provisions of Paragraph&nbsp;6 hereof
constitute independent and separable covenants which shall survive the termination of the
Employment Period and which shall be enforceable by the Executive notwithstanding any rights or
remedies the Company may have under any other provisions hereof.
</DIV>


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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Specific Performance</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive acknowledges that (i)&nbsp;the services to be rendered under the provisions of this
Agreement and the obligations of the Executive assumed herein are of a special, unique and
extraordinary character; (ii)&nbsp;it would be difficult or impossible to replace such services and
obligations; (iii)&nbsp;the Company, its subsidiaries and affiliates will be irreparably damaged if the
provisions hereof are not specifically enforced; and (iv)&nbsp;the award of monetary damages will not
adequately protect the Company, its subsidiaries and affiliates in the event of a breach hereof by
the Executive. The Company acknowledges that (i)&nbsp;the Executive will be irreparably damaged if the
provisions of Paragraph&nbsp;6 hereof are not specifically enforced and (ii)&nbsp;the award of monetary
damages will not adequately protect the Executive in the event of a breach thereof by the Company.
By virtue thereof, the Executive agrees and consents that if he violates any of the provisions of
this Agreement, and the Company agrees and consents that if it violates any of the provisions of
Paragraph&nbsp;6 hereof, the other party, in addition to any other rights and remedies available under
this Agreement or otherwise, shall (without any bond or other security being required and without
the necessity of proving monetary damages) be entitled to a temporary and/or permanent injunction
to be issued by a court of competent jurisdiction restraining the breaching party from committing
or continuing any violation of this Agreement, or any other appropriate decree of specific
performance. Such remedies shall not be exclusive and shall be in addition to any other remedy
which any of them may have.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Miscellaneous</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Entire Agreement; Amendment</U>. This Agreement constitutes the whole employment
agreement between the parties and may not be modified, amended or terminated except by a written
instrument executed by the parties hereto. . It is specifically agreed and understood, however,
that the provisions of that certain letter agreement dated as of December&nbsp;30, 2008 granting to the
Executive extended separation benefits in the event of a change in control of the Company shall
survive and shall not be affected hereby. All other agreements between the parties pertaining to
the employment or remuneration of the Executive not specifically contemplated hereby or
incorporated or merged herein are terminated and shall be of no further force or effect.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Assignment</U>. Except as stated below, this Agreement is not assignable by the
Company without the written consent of the Executive, or by the Executive without the written
consent of the Company, and any purported assignment by either party of such party&#146;s rights and/or
obligations under this Agreement shall be null and void; provided, however, that, notwithstanding
the foregoing, the Company may merge or consolidate with or into another corporation, or sell all
or substantially all of its assets to another corporation or business entity or otherwise
reorganize itself, provided the surviving corporation or entity, if not the Company, shall assume
this Agreement and become obligated to perform all of the terms and conditions hereof, in which
event the Executive&#146;s obligations shall continue in favor of such other corporation or entity.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Waivers, etc.</U> No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any subsequent breach or
default of the same or similar nature. The failure of any party to insist
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">upon strict adherence to any term of this Agreement on any occasion shall not operate or be
construed as a waiver of the right to insist upon strict adherence to that term or any other term
of this Agreement on that or any other occasion.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Provisions Overly Broad</U>. In the event that any term or provision of this Agreement
shall be deemed by a court of competent jurisdiction to be overly broad in scope, duration or area
of applicability, the court considering the same shall have the power and hereby is authorized and
directed to modify such term or provision to limit such scope, duration or area, or all of them, so
that such term or provision is no longer overly broad and to enforce the same as so limited.
Subject to the foregoing sentence, in the event any provision of this Agreement shall be held to be
invalid or unenforceable for any reason, such invalidity or unenforceability shall attach only to
such provision and shall not affect or render invalid or unenforceable any other provision of this
Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Notices</U>. Any notice permitted or required hereunder shall be in writing and shall
be deemed to have been given on the date of delivery or, if mailed by registered or certified mail,
postage prepaid, on the date of mailing:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Executive to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Michael J. Long<BR>
45590 Coal Creek<BR>
Parker, CO 80138<BR></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Company to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Arrow Electronics, Inc.<BR>
50 Marcus Drive<BR>
Melville, New York 11747<BR></TD>
</TR>
</TABLE>
</DIV>


<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="11%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;Attention:&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Peter S. Brown<BR>
Senior Vice President and<BR>
General Counsel</TD>
</TR>

</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Either party may, by notice to the other, change his or its address for notice hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>New York Law</U>. This Agreement shall be construed and governed in all respects by
the internal laws of the State of New York, without giving effect to principles of conflicts of
law.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
above written.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3" align="left">ARROW ELECTRONICS, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Peter S. Brown
&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Peter S. Brown&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="2" align="left">Senior Vice President &#038; General Counsel&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3" align="left">THE EXECUTIVE<BR>
&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ Michael J. Long
&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD colspan="3" align="left">Michael J. Long&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-10.K.II
<SEQUENCE>3
<FILENAME>y74529exv10wkwii.htm
<DESCRIPTION>EX-10.K.II: EMPLOYMENT AGREEMENT
<TEXT>
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<TITLE>EX-10.K.II</TITLE>
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10(k)(ii)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EMPLOYMENT AGREEMENT (the &#147;Agreement&#148;) made as of the 30<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> day of December, 2008 by
and between ARROW ELECTRONICS, INC., a New York corporation with its principal office at 50 Marcus
Drive, Melville, New York 11747 (the &#147;Company&#148;), and PETER S. BROWN, residing at 808 Court North
Drive, Melville, NY 11747 (the &#147;Executive&#148;).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company desires to continue to employ the Executive as Senior Vice President,
General Counsel and Secretary, with the responsibilities and duties of a principal executive
officer of the Company;
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Executive has been working for the Company under an Employment Agreement dated as
of December&nbsp;13, 2002 (the &#147;Old Agreement&#148;);
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Old Agreement contains certain provisions that do not comply with section 409A of
the Internal Revenue Code of 1986, as amended and applicable regulations thereunder (&#147;409A&#148;) and
other provisions that are obsolete; and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company and the Executive wish to novate the Old Agreement and to replace it with
this Agreement.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the
parties agree as follows:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Employment and Duties</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Employment</U>. The Company hereby employs the Executive for the Employment Period
defined in Paragraph&nbsp;3, to perform such duties for the Company and its subsidiaries and affiliates
and to hold such offices as may be specified from time to time by the Company&#146;s Board of Directors,
subject to the following provisions of this Agreement. The Executive hereby accepts such
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Duties and Responsibilities</U>. The Executive will be Senior Vice President, General
Counsel and Secretary of the Company and shall report directly to the Chief Executive Officer (the
&#147;CEO&#148;), but the Board of Directors shall have the right to adjust the duties, responsibilities, and
title of the Executive as the Board of Directors may from time to time deem to be in the interests
of the Company (provided, however, that during the Employment Period, without the consent of the
Executive, he shall not be assigned any titles, duties or responsibilities which, in the aggregate,
represent a material diminution in, or are materially inconsistent with, his title, duties, and
responsibilities as Senior Vice President, General Counsel and Secretary reporting directly to the
CEO).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Board of Directors (i)&nbsp;fails to continue the Executive in the offices of Senior Vice
President, General Counsel and Secretary (or in some other principal executive office satisfactory
to the Executive) or (ii)&nbsp;changes the Executive&#146;s reporting relationship such that he no longer
reports directly to the CEO, the Executive shall have the right to decline to give further service
to the Company and shall have the rights and obligations which would accrue to him under Paragraph
6 if he were discharged without cause. If the Executive decides to exercise such right to decline
to give further service, he shall within forty-five days after such action or omission by the Board of Directors give written notice to the Company stating his objection
and
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">the action he thinks necessary to correct it, and he shall permit the Company to have a
forty-five day period in which to correct its action or omission. If the Company makes a
correction satisfactory to the Executive, the Executive shall be obligated to continue to serve the
Company. If the Company does not make such a correction, the Executive&#146;s rights and obligations
under Paragraph&nbsp;6 shall accrue at the expiration of such forty-five day period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Time Devoted to Duties</U>. The Executive shall devote all of his normal business time
and efforts to the business of the Company, its subsidiaries and its affiliates, the amount of such
time to be sufficient, in the reasonable judgment of the Board of Directors, to permit him
diligently and faithfully to serve and endeavor to further their interests to the best of his
ability.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Location of Office</U>. The Company shall not require the Executive to locate his
office outside the New York metropolitan area without his consent.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Vacation</U>. During the Employment Period, the Executive will be given four weeks
vacation with full pay each year, to be taken at the Executive&#146;s discretion; provided however, that
the Executive will use his best efforts to ensure that such vacation does not unduly interfere with
the operation and performance of the business of the Company, its subsidiaries or its affiliates.
The Executive&#146;s vacation time for any year will be appropriately pro-rated to reflect a partial
year of employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Compensation</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Monetary Remuneration and Benefits</U>. Effective September&nbsp;1, 2002 and through the
Employment Period, the Company shall pay to the Executive for all services rendered by him in any
capacity:
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. a minimum base salary at the rate of $450,000 per year (payable in
accordance with the Company&#146;s then prevailing practices, but in no event less
frequently than in equal monthly installments), subject to increase from time to
time in the sole discretion of the Board of Directors of the Company; provided that,
should the Company institute a Company-wide pay cut/furlough program, such salary
may be decreased by up to 15%, but only for as long as said Company-wide program is
in effect;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. such additional compensation by way of salary or bonus or fringe benefits
as the Board of Directors of the Company in its sole discretion shall authorize or
agree to pay, payable on such terms and conditions as it shall determine; and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. such employee benefits that are made available by the Company to its other
principal executives.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Annual Incentive Payment</U>. The Executive shall participate in the Company&#146;s
Management Incentive Plan (or such alternative, successor, or replacement plan or program in which
the Company&#146;s executives, other than the CEO, generally participate) and shall have a targeted
incentive thereunder of not less than $175,000 per annum; provided, however, that the Executive&#146;s actual incentive payment in any year shall be measured by the Company&#146;s
</DIV>

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</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">performance against goals established for that year and that such performance may produce an
incentive payment ranging from none to twice the targeted amount. The Executive&#146;s incentive
payment for any year will be appropriately pro-rated to reflect a partial year of employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Supplemental Executive Retirement Plan</U>. The Executive shall participate in the
Company&#146;s Unfunded Pension Plan for Selected Executives (the &#147;SERP&#148;), at an accrual rate as
prescribed in the SERP, but no less than 2.5% per year from his date of hire (which for avoidance
of doubt shall provide him with an annual minimum aggregate retirement benefit from all
Company-furnished sources of approximately $200,000 per year assuming retirement at age 60). The
timing of payment under the SERP shall be in accordance with its terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Automobile</U>. During the Employment Period, the Company will pay the Executive a
monthly automobile allowance of $850. Such allowance shall cease when the Executive&#146;s employment
with the Company terminates for any reason.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Expenses</U>. During the Employment Period, the Company agrees to reimburse the
Executive, upon the submission of appropriate vouchers, for out-of-pocket expenses (including,
without limitation, expenses for travel, lodging and entertainment) incurred by the Executive in
the course of his duties hereunder in accordance with its expense reimbursement policy. Any
reimbursement that is taxable to Executive shall be paid no later than the end of the year
following the year in which it is incurred.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>Office and Staff</U>. The Company will provide the Executive with an office, secretary
and such other facilities as may be reasonably required for the proper discharge of his duties
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <U>Indemnification</U>. The Company agrees to indemnify the Executive for any and all
liabilities to which he may be subject as a result of his employment hereunder (and as a result of
his service as an officer or director of the Company, or as an officer or director of any of its
subsidiaries or affiliates), as well as the costs of any legal action brought or threatened against
him as a result of such employment, to the fullest extent permitted by law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <U>Participation in Plans</U>. Notwithstanding any other provision of this Agreement, the
Executive shall have the right to participate in any and all of the plans or programs made
available by the Company (or it subsidiaries, divisions or affiliates) to, or for the benefit of,
executives (including the annual stock option and restricted stock grant programs) or employees in
general, on a basis consistent with other senior executives.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>The Employment Period</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The &#147;Employment Period,&#148; as used in the Agreement, shall mean the period beginning as of the
date hereof and terminating on the last day of the calendar month in which the first of the
following occurs:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) the death of the Executive;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) the disability of the Executive as determined in accordance with Paragraph&nbsp;4 hereof and
subject to the provisions thereof;
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) the termination of the Executive&#146;s employment by the Company for cause in accordance with
Paragraph&nbsp;5 hereof; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;December&nbsp;31, 2010; provided, however, that, unless sooner terminated as otherwise provided
herein, the Employment Period shall automatically be extended for one or more twelve (12)&nbsp;month
periods beyond the then scheduled expiration date thereof unless between the 18th and 12th month
preceding such scheduled expiration date either the Company or the Executive gives the other
written notice of its or his election not to have the Employment Period so extended.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Disability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the Executive will be deemed &#147;disabled&#148; if he is absent from
work because he is incapacitated due to an accident or physical or mental impairment, and one of
the following conditions is also satisfied: (i)&nbsp;Executive is expected to return to his duties with
the Company within 6&nbsp;months after the beginning of his absence or (ii)&nbsp;Executive is unable to
perform his duties or those of a substantially similar position of employment due to a
medically-determinable physical or mental impairment which can be expected to result in death or
last for a continuous period of not less than 6&nbsp;months. If the Executive is absent on account of
being disabled (as defined in the preceding sentence), during such absence the Company shall
continue to pay to the Executive his base salary, any additional compensation authorized by the
Company&#146;s Board of Directors, and other remuneration and benefits provided in accordance with
Paragraph&nbsp;2 hereof, all without delay, diminution or proration of any kind whatsoever (except that
his remuneration hereunder shall be reduced by the amount of any payments he may otherwise receive
as a result of his disability pursuant to a disability program provided by or through the Company),
and his medical benefits and life insurance shall remain in full force. Unless terminated earlier
in accordance with Paragraph&nbsp;3a), c) or d), the Employment Period shall end on the 180<SUP style="font-size: 85%; vertical-align: text-top">th</SUP>
consecutive day of his disability absence, and Executive&#146;s compensation under Paragraph&nbsp;2 shall
immediately cease, except the medical benefits covering the Executive and his family shall remain
in place (subject to the eligibility requirements and other conditions contained in the underlying
plan, as described in the Company&#146;s employee benefits manual, and subject to the requirement that
the Executive continue to pay the &#147;employee portion&#148; of the cost thereof), and the Executive&#146;s life
insurance policy under the Management Insurance Program shall be transferred to him, as provided in
the related agreement, subject to the obligation of the Executive to pay the premiums therefor.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Executive is determined to be capable of performing his duties before
being absent for 180 consecutive days (and before expiration of the Employment Period), the
Executive shall be entitled to resume employment with the Company under the terms of this Agreement
for the then remaining balance of the Employment Period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Termination for Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any malfeasance, willful misconduct, active fraud or gross negligence by the
Executive in connection with his employment hereunder, the Company shall have the right to
terminate the Employment Period by giving the Executive notice in writing of the reason for such
proposed termination. If the Executive shall not have corrected such conduct to the satisfaction
of the Company within thirty days after such notice, the Employment Period shall terminate and the
Company shall have no further obligation to the Executive hereunder or
</DIV>
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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">under the SERP but the restriction on the Executive&#146;s activities contained in Paragraph&nbsp;7 and
the obligations of the Executive contained in Paragraphs 8(b) and 8(c) shall continue in effect as
provided therein.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Termination Without Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company discharges the Executive without cause, the Executive shall be
entitled to the following compensation during the remainder of the Employment Period (the length of
which shall be determined pursuant to Paragraph&nbsp;3d) unless sooner terminated by the Executive&#146;s
disability or death) (i)&nbsp;the salary provided in Paragraph&nbsp;2a) payable in accordance with the usual
payroll schedule, (ii)&nbsp;two thirds of the targeted incentive provided in Paragraph&nbsp;2b) for each year
during the Employment Period (or on a pro rata basis, portion of a year) payable on the normal
payment date(s) for such incentive award(s), (iii)&nbsp;the vesting of any restricted stock awards and
the immediate exercisability of any stock options which would have vested or become exercisable
during the Employment Period, and (iv)&nbsp;continued participation in the Company&#146;s medical plan under
the same terms and conditions as an active employee, with eligibility for continuation coverage for
Executive and his eligible dependents under the plan&#146;s COBRA provisions at the end of the
Employment Period at Executive&#146;s own expense. Additionally Executive shall be deemed vested in the
SERP benefit to the extent it would have accrued through the then scheduled expiration of the
Employment Period. However, participation in the Company&#146;s 401(k) plan, ESOP and all welfare and
fringe benefit plans (other than the medical plan) will cease on the Executive&#146;s last day of active
work, subject to any conversion rights generally available to former employees. Any amounts
payable to the Executive under this Paragraph&nbsp;6 shall be reduced by the amount of the Executive&#146;s
earnings from other employment (which the Executive shall have an affirmative duty to seek;
provided, however, that the Executive shall not be obligated to accept a new position which is not
reasonably comparable to his employment with the Company).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, if the Executive is a &#147;specified employee&#148; for purposes of
409A, no deferred compensation (including without limitation salary continuation payments in
accordance with clause (i)&nbsp;above) payable at separation from service that is not exempt from
application of 409A as a short term deferral or separation pay will be paid to Executive during the
6-month period immediately following the day he ceases active work for the Company, and any such
payments otherwise due during such 6-month period shall be paid on the first business day following
completion of such 6-month period along with simple interest at the six-month Treasury rate in
effect at the beginning of such 6-month period.
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">7.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Non-Competition; Trade Secrets</U>.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Employment Period and for a period of two years after the termination of the
Employment Period, the Executive will not, directly or indirectly:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Disclosure of Information</U>. Use, attempt to use, disclose or otherwise make known
to any person or entity (other than to the Board of Directors of the Company or otherwise in the
course of the business of the Company, its subsidiaries or affiliates and except as may be required
by applicable law):
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) any knowledge or information, including, without limitation, lists of
customers or suppliers, trade secrets, know-how, inventions, discoveries, processes
and formulae, as well as all data and records pertaining thereto, which
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">he may acquire in the course of his employment, in any manner which may be
detrimental to or cause injury or loss to the Company, its subsidiaries or
affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii) any knowledge or information of a confidential nature (including all
unpublished matters) relating to, without limitation, the business, properties,
accounting, books and records, trade secrets or memoranda of the Company, its
subsidiaries or affiliates, which he now knows or may come to know in any manner
which may be detrimental to or cause injury or loss to the Company, its subsidiaries
or affiliates.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Non-Competition</U>. Engage or become interested in the United States, Canada or
Mexico (whether as an owner, shareholder, partner, lender or other investor, director, officer,
employee, consultant or otherwise) in the business of distributing electronic parts, components,
supplies or systems, or any other business that is competitive with the principal business or
businesses then (or, in the case of the post-termination covenant, as of the date of termination)
conducted by the Company, its subsidiaries or affiliates (provided, however, that nothing contained
herein shall prevent the Executive from acquiring or owning less than 1% of the issued and
outstanding capital stock or debentures of a corporation whose securities are listed on the New
York Stock Exchange, American Stock Exchange, or the National Association of Securities Dealers
Automated Quotation System, if such investment is otherwise permitted by the Company&#146;s Human
Resource and Conflict of Interest policies).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Solicitation</U>. Solicit or participate in the solicitation of any business of any
type conducted by the Company, its subsidiaries or affiliates, during said term or thereafter, from
any person, firm or other entity which was or at the time is a supplier or customer, or prospective
supplier or customer, of the company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Employment</U>. Employ or retain, or arrange to have any other person, firm or other
entity employ or retain, or otherwise participate in the employment or retention of, any person who
was an employee or consultant of the Company, its subsidiaries or affiliates, at any time during
the period of twelve consecutive months immediately preceding such employment or retention.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive will promptly furnish in writing to the Company, its subsidiaries or affiliates,
any information reasonably requested by the Company (including any third party confirmations) with
respect to any activity or interest the Executive may have in any business.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly herein provided, nothing contained herein is intended to prevent the
Executive, at any time after the termination of the Employment Period, from either (i)&nbsp;being
gainfully employed or (ii)&nbsp;exercising his skills and abilities outside of such geographic areas,
provided in either case the provisions of this Agreement are complied with.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Preservation of Business</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>General</U>. During the Employment Period, the Executive will use his best efforts to
advance the business and organization of the Company, its subsidiaries and affiliates, to keep
available to the Company, its subsidiaries and affiliates, the services of present and future
employees and to advance the business relations with its suppliers, distributors, customers and
others.
</DIV>


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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Patents and Copyrights, etc.</U> The Executive agrees, without additional
compensation, to make available to the Company all knowledge possessed by him relating to any
methods, developments, inventions, processes, discoveries and/or improvements (whether patented,
patentable or unpatentable) which concern in any way the business of the Company, its subsidiaries
or affiliates, whether acquired by the Executive before or during his employment or retention
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any methods, developments, inventions, processes, discoveries and/or improvements (whether
patented, patentable or unpatentable) which the Executive may conceive of or make, related directly
or indirectly to the business or affairs of the Company, its subsidiaries or affiliates, or any
part thereof, during the Employment Period, shall be and remain the property of the Company. The
Executive agrees promptly to communicate and disclose all such methods, developments, inventions,
processes, discoveries and/or improvements to the Company and to execute and deliver to it any
instruments deemed necessary by the Company to effect the disclosure and assignment thereof to it.
The Executive also agrees, on request and at the expense of the Company, to execute patent
applications and any other instruments deemed necessary by the Company for the prosecution of such
patent applications or the acquisition of Letters Patent in the United States or any other country
and for the assignment to the Company of any patents which may be issued. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of having made such patent applications or being granted such
patents.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any writings or other materials written or produced by the Executive or under his supervision
(whether alone or with others and whether or not during regular business hours), during the
Employment Period which are related, directly or indirectly, to the business or affairs of the
Company, its subsidiaries or affiliates, or are capable of being used therein, and the copyright
thereof, common law or statutory, including all renewals and extensions, shall be and remain the
property of the Company. The Executive agrees promptly to communicate and disclose all such
writings or materials to the Company and to execute and deliver to it any instruments deemed
necessary by the Company to affect the disclosure and assignment thereof to it. The Executive
further agrees, on request and at the expense of the Company, to take any and all action deemed
necessary by the Company to obtain copyrights or other protections for such writings or other
materials or to protect the Company&#146;s right, title and interest therein. The Company shall
indemnify, defend and hold the Executive harmless from any and all costs, expenses, liabilities or
damages sustained by the Executive by reason of the Executive&#146;s compliance with the Company&#146;s
request.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Return of Documents</U>. Upon the termination of the Employment Period, including any
termination of employment described in Paragraph&nbsp;6, the Executive will promptly return to the
Company all copies of information protected by Paragraph 7(a) hereof or pertaining to matters
covered by subparagraph (b)&nbsp;of this Paragraph&nbsp;8 which are in his possession, custody or control,
whether prepared by him or others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Separability.</U>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive agrees that the provisions of Paragraphs 7 and 8 hereof constitute independent
and separable covenants which shall survive the termination of the Employment Period and which
shall be enforceable by the Company notwithstanding any rights or remedies the Executive may have
under any other provisions hereof. The Company agrees that the
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->7<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">provisions of Paragraph&nbsp;6 hereof constitute independent and separable covenants which shall
survive the termination of the Employment Period and which shall be enforceable by the Executive
notwithstanding any rights or remedies the Company may have under any other provisions hereof.
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">10.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Specific Performance</U>.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive acknowledges that (i)&nbsp;the services to be rendered under the provisions of this
Agreement and the obligations of the Executive assumed herein are of a special, unique and
extraordinary character; (ii)&nbsp;it would be difficult or impossible to replace such services and
obligations; (iii)&nbsp;the Company, its subsidiaries and affiliates will be irreparably damaged if the
provisions hereof are not specifically enforced; and (iv)&nbsp;the award of monetary damages will not
adequately protect the Company, its subsidiaries and affiliates in the event of a breach hereof by
the Executive. The Company acknowledges that (i)&nbsp;the Executive will be irreparably damaged if the
provisions of Paragraphs 1(b) and 6 hereof are not specifically enforced and (ii)&nbsp;the award of
monetary damages will not adequately protect the Executive in the event of a breach thereof by the
Company. By virtue thereof, the Executive agrees and consents that if he violates any of the
provisions of this Agreement, and the Company agrees and consents that if it violates any of the
provisions of Paragraphs 1(b) and 6 hereof, the other party, in addition to any other rights and
remedies available under this Agreement or otherwise, shall (without any bond or other security
being required and without the necessity of proving monetary damages) be entitled to a temporary
and/or permanent injunction to be issued by a court of competent jurisdiction restraining the
breaching party from committing or continuing any violation of this Agreement, or any other
appropriate decree of specific performance. Such remedies shall not be exclusive and shall be in
addition to any other remedy which any of them may have.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Miscellaneous</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Assignment</U>. Except as stated below, this Agreement is not assignable by the
Company without the written consent of the Executive, or by the Executive without the written
consent of the Company, and any purported assignment by either party of such party&#146;s rights and/or
obligations under this Agreement shall be null and void; provided, however, that, notwithstanding
the foregoing, the Company may merge or consolidate with or into another corporation, or sell all
or substantially all of its assets to another corporation or business entity or otherwise
reorganize itself, provided the surviving corporation or entity, if not the Company, shall assume
this Agreement and become obligated to perform all of the terms and conditions hereof, in which
event the Executive&#146;s obligations shall continue in favor of such other corporation or entity.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Waivers, etc.</U> No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any subsequent breach or
default of the same or similar nature. The failure of any party to insist upon strict adherence to
any term of this Agreement on any occasion shall not operate or be construed as a waiver of the
right to insist upon strict adherence to that term or any other term of this Agreement on that or
any other occasion.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Provisions Overly Broad</U>. In the event that any term or provision of this Agreement
shall be deemed by a court of competent jurisdiction to be overly broad in scope,
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">duration or area of applicability, the court considering the same shall have the power and
hereby is authorized and directed to modify such term or provision to limit such scope, duration or
area, or all of them, so that such term or provision is no longer overly broad and to enforce the
same as so limited. Subject to the foregoing sentence, in the event any provision of this
Agreement shall be held to be invalid or unenforceable for any reason, such invalidity or
unenforceability shall attach only to such provision and shall not affect or render invalid or
unenforceable any other provision of this Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Notices</U>. Any notice permitted or required hereunder shall be in writing and shall
be deemed to have been given on the date of delivery or, if mailed by registered or certified mail,
postage prepaid, on the date of mailing:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Executive to:</TD>
</TR>

</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-left: 9%; margin-top: 6pt">Peter S. Brown<BR>
808 Court North Drive<BR>
Melville, NY 11747
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Company to:</TD>
</TR>

</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-left: 9%; margin-top: 6pt">Arrow Electronics, Inc.<BR>
50 Marcus Drive<BR>
Melville, New York 11747<BR>
Attention: President and Chief Executive Officer
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Either party may, by notice to the other, change his or its address for notice hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>New York Law</U>. This Agreement shall be construed and governed in all respects by
the internal laws of the State of New York, without giving effect to principles of conflicts of
law.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
above written.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3" align="left">ARROW ELECTRONICS, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Paul J. Reilly
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Paul J. Reilly&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Senior Vice President and Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3" align="left">THE EXECUTIVE<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ Peter S. Brown
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD colspan="3" align="left">Peter S. Brown&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-10.K.III
<SEQUENCE>4
<FILENAME>y74529exv10wkwiii.htm
<DESCRIPTION>EX-10.K.III: EMPLOYMENT AGREEMENT
<TEXT>
<HTML>
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<TITLE>EX-10.K.III</TITLE>
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10(k)(iii)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EMPLOYMENT AGREEMENT (the &#147;Agreement&#148;) made as of the 30th day of December, 2008 by and
between ARROW ELECTRONICS, INC., a New York corporation with its principal office at 50 Marcus
Drive, Melville, New York 11747 (the &#147;Company&#148;), and PAUL J. REILLY, residing at 21 Osborne Road,
Garden City, New York 11530 (the &#147;Executive&#148;).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Executive has been employed by the Company as Senior Vice President and Chief
Financial Officer, with the responsibilities and duties of an executive officer of the Company,
under an Employment Agreement dated as of January&nbsp;14, 2003 (the &#147;Old Agreement&#148;);
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Old Agreement contains provisions that do not comply with section 409A of the
Internal Revenue Code of 1986, as amended, and applicable regulations thereunder (&#147;409A&#148;) and other
provisions that are obsolete; and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company and Executive wish to novate the Old Agreement and to replace it with
this Agreement.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the
parties agree as follows:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Employment and Duties</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Employment</U>. The Company hereby employs the Executive for the Employment Period
defined in Paragraph&nbsp;3, to perform such duties for the Company, its subsidiaries and affiliates and
to hold such offices as may be specified from time to time by the Company&#146;s Board of Directors,
subject to the following provisions of this Agreement. The Executive hereby accepts such
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Duties and Responsibilities</U>. It is contemplated that the Executive will be Senior
Vice President and Chief Financial Officer of the Company, but the Board of Directors shall have
the right to adjust the duties, responsibilities, and title of the Executive as the Board of
Directors may from time to time deem to be in the interests of the Company (provided, however, that
during the Employment Period, without the consent of the Executive, he shall not be assigned any
titles, duties or responsibilities which, in the aggregate, represent a material diminution in, or
are materially inconsistent with, his prior title, duties, and responsibilities as Senior Vice
President and Chief Financial Officer).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Board of Directors does not either continue the Executive in the office of Senior Vice
President and Chief Financial Officer or elect him to some other executive office satisfactory to
the Executive, the Executive shall have the right to decline to give further service to the Company
and shall have the rights and obligations which would accrue to him under Paragraph&nbsp;6 if he were
discharged without cause. If the Executive decides to exercise such right to decline to give
further service, he shall within forty-five days after such action or omission by the Board of
Directors give written notice to the Company stating his objection and the action he thinks
necessary to correct it, and he shall permit the Company to have a forty-five day period in which
to correct its action or omission. If the Company makes a correction satisfactory to the
Executive, the Executive shall be obligated to continue to serve the Company. If the Company
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">does not make such a correction, the Executive&#146;s rights and obligations under Paragraph&nbsp;6
shall accrue at the expiration of such forty-five day period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Time Devoted to Duties</U>. The Executive shall devote all of his normal business time
and efforts to the business of the Company, its subsidiaries and its affiliates, the amount of such
time to be sufficient, in the reasonable judgment of the Board of Directors, to permit him
diligently and faithfully to serve and endeavor to further their interests to the best of his
ability.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Compensation</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Monetary Remuneration and Benefits</U>. During the Employment Period, the Company
shall pay to the Executive for all services rendered by him in any capacity:
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. a minimum base salary of $400,000 per year (payable in accordance with the
Company&#146;s then prevailing practices, but in no event less frequently than in equal
monthly installments), subject to increase if the Board of Directors of the Company
in its sole discretion so determines; provided that, should the company institute a
company-wide pay cut/furlough program, such salary may be decreased by up to 15%,
but only for as long as said company-wide program is in effect;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. such additional compensation by way of salary or bonus or fringe benefits
as the Board of Directors of the Company in its sole discretion shall authorize or
agree to pay, payable on such terms and conditions as it shall determine; and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. such employee benefits that are made available by the Company to its other
executives generally.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Annual Incentive Payment</U>. The Executive shall participate in the Company&#146;s
Management Incentive Plan (or such alternative, successor, or replacement plan or program in which
the Company&#146;s principal operating executives, other than the Chief Executive Officer, generally
participate) and shall have a targeted incentive thereunder of not less than $150,000 per annum;
provided, however, that the Executive&#146;s actual incentive payment in any year shall be measured by
the Company&#146;s performance against goals established for that year and that such performance may
produce an incentive payment ranging from none to twice the targeted amount. The Executive&#146;s
incentive payment for any year will be appropriately pro-rated to reflect a partial year of
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Supplemental Executive Retirement Plan</U>. The Executive shall continue to
participate in the Company&#146;s Unfunded Pension Plan for Selected Executives (the &#147;SERP&#148;). The
timing of payment under the SERP shall be in accordance with its terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Automobile</U>. During the Employment Period, the Company will pay the Executive a
monthly automobile allowance of $850. Such allowance shall cease when the Executive&#146;s employment
with the Company terminates for any reason.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Expenses</U>. During the Employment Period, the Company agrees to reimburse the
Executive, upon the submission of appropriate vouchers, for out-of-pocket expenses (including,
without limitation, expenses for travel, lodging and entertainment) incurred by the Executive in
the course of his duties hereunder in accordance with its expense reimbursement policy. Any
reimbursement that is taxable to Executive shall be paid no later than the end of the year
following the year in which it is incurred.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>Office and Staff</U>. The Company will provide the Executive with an office, secretary
and such other facilities as may be reasonably required for the proper discharge of his duties
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <U>Indemnification</U>. The Company agrees to indemnify the Executive for any and all
liabilities to which he may be subject as a result of his employment hereunder (and as a result of
his service as an officer or director of the Company, or as an officer or director of any of its
subsidiaries or affiliates), as well as the costs of any legal action brought or threatened against
him as a result of such employment, to the fullest extent permitted by law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <U>Participation in Plans</U>. Notwithstanding any other provision of this Agreement, the
Executive shall have the right to participate in any and all of the plans or programs made
available by the Company (or it subsidiaries, divisions or affiliates) to, or for the benefit of,
executives (including the annual stock option and restricted stock grant programs) or employees in
general, on a basis consistent with other senior executives.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>The Employment Period</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The &#147;Employment Period,&#148; as used in the Agreement, shall mean the period beginning as of the
date hereof and terminating on the last day of the calendar month in which the first of the
following occurs:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) the death of the Executive;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) the disability of the Executive as determined in accordance with Paragraph&nbsp;4 hereof and
subject to the provisions thereof;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) the termination of the Executive&#146;s employment by the Company for cause in accordance with
Paragraph&nbsp;5 hereof; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) December&nbsp;31, 2010; provided, however, that, unless sooner terminated as otherwise provided
herein, the Employment Period shall automatically be extended for one or more twelve (12)&nbsp;month
periods beyond the then scheduled expiration date thereof unless between the 18th and 12th month
preceding such scheduled expiration date either the Company or the Executive gives the other
written notice of its or his election not to have the Employment Period so extended.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Disability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the Executive will be deemed &#147;disabled&#148; if he is absent from
work because he is incapacitated due to an accident or physical or mental
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">impairment, and one of the following conditions is also satisfied: (i)&nbsp;Executive is expected
to return to his duties with the Company within 6&nbsp;months after the beginning of his absence or (ii)
Executive is unable to perform his duties or those of a substantially similar position of
employment due to a medically-determinable physical or mental impairment which can be expected to
result in death or last for a continuous period of not less than 6&nbsp;months. If the Executive is
absent on account of being disabled (as defined in the preceding sentence), during such absence the
Company shall continue to pay to the Executive his base salary, any additional compensation
authorized by the Company&#146;s Board of Directors, and other remuneration and benefits provided in
accordance with Paragraph&nbsp;2 hereof, all without delay, diminution or proration of any kind
whatsoever (except that his remuneration hereunder shall be reduced by the amount of any payments
he may otherwise receive as a result of his disability pursuant to a disability program provided by
or through the Company), and his medical benefits and life insurance shall remain in full force.
Unless terminated earlier in accordance with Paragraph&nbsp;3a), c) or d), the Employment Period shall
end on the 180<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> consecutive day of his disability absence, and Executive&#146;s compensation
under Paragraph&nbsp;2 shall immediately cease, except the medical benefits covering the Executive and
his family shall remain in place (subject to the eligibility requirements and other conditions
contained in the underlying plan, as described in the Company&#146;s employee benefits manual, and
subject to the requirement that the Executive continue to pay the &#147;employee portion&#148; of the cost
thereof), and the Executive&#146;s life insurance policy under the Management Insurance Program shall be
transferred to him, as provided in the related agreement, subject to the obligation of the
Executive to pay the premiums therefor.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Executive is determined to be capable of performing his duties before
being absent for 180 consecutive days (and before expiration of the Employment Period), the
Executive shall be entitled to resume employment with the Company under the terms of this Agreement
for the then remaining balance of the Employment Period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Termination for Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any malfeasance, willful misconduct, active fraud or gross negligence by the
Executive in connection with his employment hereunder, the Company shall have the right to
terminate the Employment Period by giving the Executive notice in writing of the reason for such
proposed termination. If the Executive shall not have corrected such conduct to the satisfaction
of the Company within thirty days after such notice, the Employment Period shall terminate and the
Company shall have no further obligation to the Executive hereunder but the restriction on the
Executive&#146;s activities contained in Paragraph&nbsp;7 and the obligations of the Executive contained in
Paragraphs 8(b) and 8(c) shall continue in effect as provided therein.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Termination Without Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company discharges the Executive without cause, the Executive shall be
entitled to the following compensation during the remainder of the Employment Period (the length of
which shall be determined under Paragraph&nbsp;3d) unless sooner terminated by Executive&#146;s disability or
death): (i)&nbsp;the salary provided in Paragraph&nbsp;2a), payable in accordance with the usual payroll
schedule, (ii)&nbsp;two-thirds of the targeted incentive provided in Paragraph&nbsp;2b) for each year during
the Employment Period (or, on a pro rata basis, portion of a year), payable on the normal payment
date(s) for such incentive, (iii)&nbsp;the vesting of any
</DIV>

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</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">restricted stock awards and the immediate exercisability of any stock options which would have
vested or become exercisable during the Employment Period, and (iv)&nbsp;continued participation in the
Company&#146;s medical plan under the same terms and conditions as an active employee, with eligibility
for continuation coverage for Executive and his eligible dependents under the plan&#146;s COBRA
provisions at the end of the Employment Period at Executive&#146;s own expense. However, participation
in the Company&#146;s 401(k) plan, ESOP and all welfare and fringe benefit plans (other than the medical
plan) will cease on the Executive&#146;s last day of active work, subject to any conversion rights
generally available to former employees. Any amounts payable to the Executive under this Paragraph
6 shall be reduced by the amount of the Executive&#146;s earnings from other employment (which the
Executive shall have an affirmative duty to seek; provided, however, that the Executive shall not
be obligated to accept a new position which is not reasonably comparable to his employment with the
Company).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, if the Executive is a &#147;specified employee&#148; for purposes of
409A, no deferred compensation (including without limitation salary continuation payments in
accordance with clause (i)&nbsp;above) payable at separation from service that is not exempt from
application of 409A as a short term deferral or separation pay will be paid to Executive during the
6-month period immediately following the day he ceases active work for the Company, and any such
payments otherwise due during such 6-month period shall be paid on the first business day following
completion of such 6-month period along with simple interest at the six-month Treasury rate in
effect at the beginning of such 6-month period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Non-Competition; Trade Secrets</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Employment Period and for a period of one year after the termination of the
Employment Period, the Executive will not, directly or indirectly:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Disclosure of Information</U>. Use, attempt to use, disclose or otherwise make known
to any person or entity (other than to the Board of Directors of the Company or otherwise in the
course of the business of the Company, its subsidiaries or affiliates and except as may be required
by applicable law):
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 5%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. any knowledge or information, including, without limitation, lists of
customers or suppliers, trade secrets, know-how, inventions, discoveries, processes
and formulae, as well as all data and records pertaining thereto, which he may
acquire in the course of his employment, in any manner which may be detrimental to
or cause injury or loss to the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 5%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. any knowledge or information of a confidential nature (including all
unpublished matters) relating to, without limitation, the business, properties,
accounting, books and records, trade secrets or memoranda of the Company, its
subsidiaries or affiliates, which he now knows or may come to know in any manner
which may be detrimental to or cause injury or loss to the Company, its subsidiaries
or affiliates.
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Non-Competition</U>. Engage or become interested in the United States, Canada or
Mexico (whether as an owner, shareholder, partner, lender or other investor, director, officer,
employee, consultant or otherwise) in the business of distributing electronic parts, components,
supplies or systems, or any other business that is competitive with the principal business or
businesses then conducted by the Company, its subsidiaries or affiliates (provided, however, that
nothing contained herein shall prevent the Executive from acquiring or owning less than 1% of the
issued and outstanding capital stock or debentures of a corporation whose securities are listed on
the New York Stock Exchange, American Stock Exchange, or the National Association of Securities
Dealers Automated Quotation System, if such investment is otherwise permitted by the Company&#146;s
Human Resource and Conflict of Interest policies);
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Solicitation</U>. Solicit or participate in the solicitation of any business of any
type conducted by the Company, its subsidiaries or affiliates, during said term or thereafter, from
any person, firm or other entity which was or at the time is a supplier or customer, or prospective
supplier or customer, of the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Employment</U>. Employ or retain, or arrange to have any other person, firm or other
entity employ or retain, or otherwise participate in the employment or retention of, any person who
was an employee or consultant of the Company, its subsidiaries or affiliates, at any time during
the period of twelve consecutive months immediately preceding such employment or retention.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive will promptly furnish in writing to the Company, its subsidiaries or affiliates,
any information reasonably requested by the Company (including any third party confirmations) with
respect to any activity or interest the Executive may have in any business.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly herein provided, nothing contained herein is intended to prevent the
Executive, at any time after the termination of the Employment Period, from either (i)&nbsp;being
gainfully employed or (ii)&nbsp;exercising his skills and abilities outside of such geographic areas,
provided in either case the provisions of this Agreement are complied with.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Preservation of Business</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>General</U>. During the Employment Period, the Executive will use his best efforts to
advance the business and organization of the Company, its subsidiaries and affiliates, to keep
available to the Company, its subsidiaries and affiliates, the services of present and future
employees and to advance the business relations with its suppliers, distributors, customers and
others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Patents and Copyrights, etc.</U> The Executive agrees, without additional
compensation, to make available to the Company all knowledge possessed by him relating to any
methods, developments, inventions, processes, discoveries and/or improvements (whether patented,
patentable or unpatentable) which concern in any way the business of the Company, its subsidiaries
or affiliates, whether acquired by the Executive before or during his employment hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any methods, developments, inventions, processes, discoveries and/or improvements (whether
patented, patentable or unpatentable) which the Executive may conceive
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">of or make, related directly or indirectly to the business or affairs of the Company, its
subsidiaries or affiliates, or any part thereof, during the Employment Period, shall be and remain
the property of the Company. The Executive agrees promptly to communicate and disclose all such
methods, developments, inventions, processes, discoveries and/or improvements to the Company and to
execute and deliver to it any instruments deemed necessary by the Company to effect the disclosure
and assignment thereof to it. The Executive also agrees, on request and at the expense of the
Company, to execute patent applications and any other instruments deemed necessary by the Company
for the prosecution of such patent applications or the acquisition of Letters Patent in the United
States or any other country and for the assignment to the Company of any patents which may be
issued. The Company shall indemnify and hold the Executive harmless from any and all costs,
expenses, liabilities or damages sustained by the Executive by reason of having made such patent
applications or being granted such patents.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any writings or other materials written or produced by the Executive or under his supervision
(whether alone or with others and whether or not during regular business hours), during the
Employment Period which are related, directly or indirectly, to the business or affairs of the
Company, its subsidiaries or affiliates, or are capable of being used therein, and the copyright
thereof, common law or statutory, including all renewals and extensions, shall be and remain the
property of the Company. The Executive agrees promptly to communicate and disclose all such
writings or materials to the Company and to execute and deliver to it any instruments deemed
necessary by the Company to affect the disclosure and assignment thereof to it. The Executive
further agrees, on request and at the expense of the Company, to take any and all action deemed
necessary by the Company to obtain copyrights or other protections for such writings or other
materials or to protect the Company&#146;s right, title and interest therein. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of the Executive&#146;s compliance with the Company&#146;s request.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Return of Documents</U>. Upon the termination of the Employment Period, including any
termination of employment described in Paragraph&nbsp;6, the Executive will promptly return to the
Company all copies of information protected by Paragraph 7(a) hereof or pertaining to matters
covered by subparagraph (b)&nbsp;of this Paragraph&nbsp;8 which are in his possession, custody or control,
whether prepared by him or others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Separability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive agrees that the provisions of Paragraphs 7 and 8 hereof constitute independent
and separable covenants which shall survive the termination of the Employment Period and which
shall be enforceable by the Company notwithstanding any rights or remedies the Executive may have
under any other provisions hereof. The Company agrees that the provisions of Paragraph&nbsp;6 hereof
constitute independent and separable covenants which shall survive the termination of the
Employment Period and which shall be enforceable by the Executive notwithstanding any rights or
remedies the Company may have under any other provisions hereof.
</DIV>


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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Specific Performance</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive acknowledges that (i)&nbsp;the services to be rendered under the provisions of this
Agreement and the obligations of the Executive assumed herein are of a special, unique and
extraordinary character; (ii)&nbsp;it would be difficult or impossible to replace such services and
obligations; (iii)&nbsp;the Company, its subsidiaries and affiliates will be irreparably damaged if the
provisions hereof are not specifically enforced; and (iv)&nbsp;the award of monetary damages will not
adequately protect the Company, its subsidiaries and affiliates in the event of a breach hereof by
the Executive. The Company acknowledges that (i)&nbsp;the Executive will be irreparably damaged if the
provisions of Paragraph&nbsp;6 hereof are not specifically enforced and (ii)&nbsp;the award of monetary
damages will not adequately protect the Executive in the event of a breach thereof by the Company.
By virtue thereof, the Executive agrees and consents that if he violates any of the provisions of
this Agreement, and the Company agrees and consents that if it violates any of the provisions of
Paragraph&nbsp;6 hereof, the other party, in addition to any other rights and remedies available under
this Agreement or otherwise, shall (without any bond or other security being required and without
the necessity of proving monetary damages) be entitled to a temporary and/or permanent injunction
to be issued by a court of competent jurisdiction restraining the breaching party from committing
or continuing any violation of this Agreement, or any other appropriate decree of specific
performance. Such remedies shall not be exclusive and shall be in addition to any other remedy
which any of them may have.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Miscellaneous</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Entire Agreement; Amendment</U>. This Agreement constitutes the whole employment
agreement between the parties and may not be modified, amended or terminated except by a written
instrument executed by the parties hereto. It is specifically agreed and understood, however, that
the provisions of that certain letter agreement dated as of December&nbsp;30, 2008 granting to the
Executive extended separation benefits in the event of a change in control of the Company shall
survive and shall not be affected hereby. All other agreements between the parties pertaining to
the employment or remuneration of the Executive not specifically contemplated hereby or
incorporated or merged herein are terminated and shall be of no further force or effect.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Assignment</U>. Except as stated below, this Agreement is not assignable by the
Company without the written consent of the Executive, or by the Executive without the written
consent of the Company, and any purported assignment by either party of such party&#146;s rights and/or
obligations under this Agreement shall be null and void; provided, however, that, notwithstanding
the foregoing, the Company may merge or consolidate with or into another corporation, or sell all
or substantially all of its assets to another corporation or business entity or otherwise
reorganize itself, provided the surviving corporation or entity, if not the Company, shall assume
this Agreement and become obligated to perform all of the terms and conditions hereof, in which
event the Executive&#146;s obligations shall continue in favor of such other corporation or entity.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Waivers, etc.</U> No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any subsequent breach or
default of the same or similar nature. The failure of any party to insist
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">upon strict adherence to any term of this Agreement on any occasion shall not operate or be
construed as a waiver of the right to insist upon strict adherence to that term or any other term
of this Agreement on that or any other occasion.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Provisions Overly Broad</U>. In the event that any term or provision of this Agreement
shall be deemed by a court of competent jurisdiction to be overly broad in scope, duration or area
of applicability, the court considering the same shall have the power and hereby is authorized and
directed to modify such term or provision to limit such scope, duration or area, or all of them, so
that such term or provision is no longer overly broad and to enforce the same as so limited.
Subject to the foregoing sentence, in the event any provision of this Agreement shall be held to be
invalid or unenforceable for any reason, such invalidity or unenforceability shall attach only to
such provision and shall not affect or render invalid or unenforceable any other provision of this
Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Notices</U>. Any notice permitted or required hereunder shall be in writing and shall
be deemed to have been given on the date of delivery or, if mailed by registered or certified mail,
postage prepaid, on the date of mailing:
</DIV>


<DIV style="margin-top: 6pt" align="right">
<TABLE width="93%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Executive to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Paul J. Reilly<br>
21 Osborne Road<br>
Garden City, New York 11530</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Company to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Arrow Electronics, Inc.<br>
50 Marcus Drive<br>
Melville, New York 11747<br>
Attention: Peter S. Brown<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President and<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General Counsel</TD>
</TR>

</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Either party may, by notice to the other, change his or its address for notice hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>New York Law</U>. This Agreement shall be construed and governed in all respects by
the internal laws of the State of New York, without giving effect to principles of conflicts of
law.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
above written.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>

    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<TR>

    <TD colspan="3" align="left">ARROW ELECTRONICS, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>

    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Peter S. Brown
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Peter S. Brown&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>

</TR><TR>

    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Senior Vice President and General Counsel&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>

    <TD colspan="3" align="left">THE EXECUTIVE<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>

    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ Paul J. Reilly
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>

    <TD colspan="3" align="left">Paul J. Reilly&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-10.K.IV
<SEQUENCE>5
<FILENAME>y74529exv10wkwiv.htm
<DESCRIPTION>EX-10.K.IV: EMPLOYMENT AGREEMENT
<TEXT>
<HTML>
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<TITLE>EX-10.K.IV</TITLE>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10(k)(iv)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EMPLOYMENT AGREEMENT (the &#147;Agreement&#148;) made as of the 30th day of December, 2008 by and
between ARROW ELECTRONICS, INC., a New York corporation with its principal office at 50 Marcus
Drive, Melville, New York 11747 (the &#147;Company&#148;), and William E. Mitchell, 223 Atherton Avenue,
Atherton, California 94027 (the &#147;Executive&#148;).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company wishes to employ the Executive as Chairman and Chief Executive Officer,
with the responsibilities and duties of a principal executive officer of the Company, under an
Employment Agreement dated as of February&nbsp;3, 2003 (the &#147;Old Agreement&#148;); and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Old Agreement contains provisions that do not comply with section 409A of the
Internal Revenue Code of 1986, as amended, and applicable regulations thereunder (&#147;409A&#148;) and other
provisions that are obsolete; and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company and Executive wish to novate the Old Agreement and to replace it with
this Agreement.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the
parties agree as follows:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Employment and Duties</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Employment</U>. The Company shall continue to employ the Executive for the Employment
Period defined in Paragraph&nbsp;3, to perform such duties for the Company, its subsidiaries and
affiliates and to hold such offices as may be specified from time to time by the Company&#146;s Board of
Directors, subject to the following provisions of this Agreement. The Executive hereby accepts such
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Duties and Responsibilities</U>. Executive will continue as Chairman and Chief
Executive Officer of the Company but the Board of Directors shall have the right to adjust the
duties, responsibilities and title of the Executive as the Board of Directors may from time to time
deem to be in the interests of the Company (provided, however, that during the Employment Period,
without the consent of the Executive, he shall not be assigned any titles, duties or
responsibilities which, in the aggregate, represent a material diminution in, or are materially
inconsistent with, his title, duties, and responsibilities as Chairman and Chief Executive
Officer). If the Board of Directors does not either continue the Executive in the office of
Chairman and Chief Executive Officer or elect him to some other principal executive office
satisfactory to the Executive, the Executive shall have the right to decline to give further
service to the Company and shall have the rights and obligations which would accrue to him under
Paragraph&nbsp;7 if he were discharged without cause. If the Executive decides to exercise such right to
decline to give further service, he shall within forty-five days after such action or omission by
the Board of Directors give written notice to the Company stating his objection and the action he
thinks necessary to correct it, and he shall permit the Company to have a forty-five day period in
which to correct its action or omission. If the Company makes a correction satisfactory to the
Executive, the Executive shall be obligated to continue to serve the Company. If the Company does
not make such a correction, the Executive&#146;s rights and obligations under Paragraph&nbsp;7 shall accrue
at the expiration of such forty-five day period.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Time Devoted to Duties</U>. The Executive shall devote substantially all of his normal
business time and efforts to the business of the Company, its subsidiaries and its affiliates, the
amount of such time to be sufficient, in the reasonable judgment of the Board of Directors, to
permit him diligently and faithfully to serve and endeavor to further their interests to the best
of his ability. The Company acknowledges that the Executive is currently serving as a member of the
Board of Directors of Rogers Corporation and certain educational and non-profit organizations and
agrees that the Executive will be permitted to continue to occupy such positions during the
Employment Period. The Executive will seek the consent of the Board of Directors prior to agreeing
to serve on any other corporate board of directors.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Member of Board of Directors</U>. The Board of Directors shall appoint the Executive
as a member of the Board of Directors as of the first day of the Employment Period. It is
contemplated that the Executive will be renominated for election as a director by the shareholders
at all subsequent Annual Meetings of Shareholders during the Employment Period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Compensation</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Monetary Remuneration and Benefits</U>. During the Employment Period, the Company
shall pay to the Executive for all services rendered by him in any capacity:
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. a minimum base salary at the rate of $750,000 per year (payable in
accordance with the Company&#146;s then prevailing practices, but in no event less
frequently than in equal monthly installments), subject to increase from time to
time in the sole discretion of the Board of Directors of the Company; provided that,
should the Company institute a company-wide pay cut/furlough program, such salary
may be decreased by up to 15%, but only for as long as said company-wide program is
in effect;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. such additional compensation by way of salary or bonus or fringe benefits
as the Board of Directors of the Company in its sole discretion shall authorize or
agree to pay, payable on such terms and conditions as it shall determine; and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. such employee benefits that are made available by the Company to its other
principal executives.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Annual Incentive Payment</U>. The Executive shall participate in the Company&#146;s Chief
Executive Officer 1999 Performance Bonus Plan, as amended (or any alternative, successor, or
replacement plan or program), and shall have a targeted incentive thereunder equal to his annual
base salary; provided, however, that the Executive&#146;s actual incentive payment in any year shall be
measured by the Company&#146;s performance against goals established by the Board of Directors for that
year and that such performance may produce an incentive payment ranging from none to any maximum
established under such plan or by the Board of Directors of the Company. The Executive&#146;s incentive
payment for any year will be appropriately pro-rated to reflect a partial year of employment.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Supplemental Executive Retirement Plan</U>. The Executive shall continue to
participate in the Company&#146;s Unfunded Pension Plan for Selected Executives (the &#147;SERP&#148;). The
timing of payment under the SERP shall be in accordance with its terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Automobile</U>. During the Employment Period, the Company will pay the Executive a
monthly automobile allowance of $850. Such allowance shall cease when the Executive&#146;s employment
with the Company terminates for any reason.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Vacation</U>. During the Employment Period, the Executive will be given four weeks
vacation with full pay each year, to be taken at the Executive&#146;s discretion; provided, however,
that the Executive will use his best efforts to ensure that such vacation does not unduly interfere
with the operation and performance of the business of the Company, its subsidiaries or its
affiliates.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>Expenses</U>. During the Employment Period, the Company agrees to reimburse the
Executive, upon the submission of appropriate vouchers, for out-of-pocket expenses (including,
without limitation, expenses for travel, lodging and entertainment) incurred by the Executive in
the course of his duties hereunder in accordance with its expense reimbursement policy. Any
reimbursement that is taxable to Executive shall be paid no later than the end of the year
following the year in which it is incurred.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <U>Office and Staff</U>. The Company will provide the Executive with an office, secretary
and such other facilities as may be reasonably required for the proper discharge of his duties
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <U>Indemnification</U>. The Company agrees to indemnify the Executive for any and all
liabilities to which he may be subject as a result of his employment hereunder (and as a result of
his service as an officer or director of the Company, or as an officer or director of any of its
subsidiaries or affiliates), as well as the costs of any legal action brought or threatened against
him as a result of such employment, to the fullest extent permitted by law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) <U>Participation in Plans</U>. Notwithstanding any other provision of this Agreement, the
Executive shall have the right to participate in any and all of the plans or programs made
available by the Company (or its subsidiaries, divisions or affiliates) to, or for the benefit of,
executives (including the annual stock option and restricted stock grant programs) or employees in
general, on a basis consistent with other senior executives.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>The Employment Period</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The &#147;Employment Period&#148;, as used in the Agreement, shall mean the period beginning as of the
date hereof and terminating on the last day of the calendar month in which the first of the
following occurs:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) the death of the Executive;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) the disability of the Executive as determined in accordance with Paragraph&nbsp;4 hereof and
subject to the provisions thereof;
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) the termination of the Executive&#146;s employment by the Company for cause in accordance with
Paragraph&nbsp;5 hereof; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) December&nbsp;31, 2010; provided, however, that, if either the Company or the Executive does not
give the other at least twelve months notice of its intention to permit this Agreement to expire on
the then scheduled termination date of the Employment Period (unless sooner terminated as otherwise
provided herein), the Employment Period shall automatically be extended for one or more additional
twelve month periods beyond the then scheduled expiration date thereof.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Disability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the Executive will be deemed &#147;disabled&#148; if he is absent from
work because he is incapacitated due to an accident or physical or mental impairment, and one of
the following conditions is also satisfied: (i)&nbsp;Executive is expected to return to his duties with
the Company within 6&nbsp;months after the beginning of his absence or (ii)&nbsp;Executive is unable to
perform his duties or those of a substantially similar position of employment due to a
medically-determinable physical or mental impairment which can be expected to result in death or
last for a continuous period of not less than 6&nbsp;months. If the Executive is absent on account of
being disabled (as defined in the preceding sentence), during such absence the Company shall
continue to pay to the Executive his base salary, any additional compensation authorized by the
Company&#146;s Board of Directors, and other remuneration and benefits provided in accordance with
Paragraph&nbsp;2 hereof, all without delay, diminution or proration of any kind whatsoever (except that
his remuneration hereunder shall be reduced by the amount of any payments he may otherwise receive
as a result of his disability pursuant to a disability program provided by or through the Company),
and his medical benefits and life insurance shall remain in full force. Unless terminated earlier
in accordance with Paragraph&nbsp;3a), c) or d), the Employment Period shall end on the 180<SUP style="font-size: 85%; vertical-align: text-top">th</SUP>
consecutive day of his disability absence, and Executive&#146;s compensation under Paragraph&nbsp;2 shall
immediately cease, except the medical benefits covering the Executive and his family shall remain
in place (subject to the eligibility requirements and other conditions contained in the underlying
plan, as described in the Company&#146;s employee benefits manual, and subject to the requirement that
the Executive continue to pay the &#147;employee portion&#148; of the cost thereof), and the Executive&#146;s life
insurance policy under the Management Insurance Program shall be transferred to him, as provided in
the related agreement, subject to the obligation of the Executive to pay the premiums therefor.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Executive terminates employment on account of disability in accordance with this
Paragraph&nbsp;4, and meets the definition of Long-Term Disability under the Arrow Electronics Long-Term
Disability Plan (the &#147;Disability Plan&#148;), the Company agrees to provide the Executive with a
long-term disability benefit that in the aggregate is equal to 2/3 of the Executive&#146;s base salary
provided in paragraph 2(a). Such payments shall begin 30&nbsp;days following the end of the Employment
Period as set forth above (i.e., on the 210th day following the beginning of his disability
absence), shall be paid in on the last business day of each month thereafter, and shall end on the
date Executive ceases to be disabled under the Disability Plan. Any such payment shall be reduced
by the amount payable to Executive for the same month under the Disability Plan. Executive shall
receive an annual tax gross-up in the amount of any U.S. income taxes owing on account of such
aggregate long-term disability payments, which
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 10pt">gross-up amount will be paid by the end of year next following the year in which Executive
remits the related taxes, and shall meet the requirements for tax gross-ups under Section&nbsp;409A of
the Code.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Executive is determined to be capable of performing his duties before
being absent for 180 consecutive days (and before expiration of the Employment Period), the
Executive shall be entitled to resume employment with the Company under the terms of this Agreement
for the then remaining balance of the Employment Period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Termination for Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any malfeasance, willful misconduct, active fraud or gross negligence by the
Executive in connection with his employment hereunder, the Company shall have the right to
terminate the Employment Period by giving the Executive notice in writing of the reason for such
proposed termination. If the Executive shall not have corrected such conduct to the reasonable
satisfaction of the Company within thirty days after such notice, the Employment Period shall
terminate and the Company shall have no further obligation to the Executive hereunder but the
restriction on the Executive&#146;s activities contained in Paragraph&nbsp;8 and the obligations of the
Executive contained in Paragraph 9(b) and 9(c) shall continue in effect as provided therein.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Death Benefit</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive is a participant in the Company&#146;s Management Insurance Program. During the
Employment Period, the Company will continue to maintain in effect for the Executive such program
or some other form of life insurance providing the Executive&#146;s estate or named beneficiary a
benefit upon the Executive&#146;s death at least equal to the net after-tax benefit provided by the
Management Insurance Program.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Termination Without Cause</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company discharges the Executive without cause, the Executive shall be
entitled to the following compensation during the remainder of the Employment Period (the length of
which shall be determined under Paragraph&nbsp;3d) unless sooner terminated by Executive&#146;s disability or
death): (i)&nbsp;the salary provided in Paragraph&nbsp;2a), payable in accordance with the usual payroll
schedule, (ii)&nbsp;100&nbsp;percent of his base salary in place of the incentive provided in Paragraph&nbsp;2(b),
payable on the normal payment date(s) for such incentive, (iii)&nbsp;the vesting of any restricted stock
awards and the immediate exercisability of any stock options which would have vested or become
exercisable during the Employment Period, and (iv)&nbsp;continued participation in the Company&#146;s medical
plan under the same terms and conditions as an active employee, with eligibility for continuation
coverage for Executive and his eligible dependents under the plan&#146;s COBRA provisions at the end of
the Employment Period at Executive&#146;s own expense. However, participation in the Company&#146;s 401(k)
plan, ESOP and all welfare and fringe benefit plans (other than the medical plan) will cease on the
Executive&#146;s last day of active work, subject to any conversion rights generally available to former
employees. The Company shall have no right to set off payments due the Executive with any amounts
he may earn from gainful employment elsewhere. It is expressly agreed and understood that the
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Executive shall be under no obligation to seek such employment. The provisions of Paragraph&nbsp;8
restricting the Executive&#146;s activities and Executive&#146;s obligations under Paragraph&nbsp;9b) and 9c)
shall continue in effect. The provisions of this Paragraph&nbsp;7 shall not act to limit the
Executive&#146;s ability to recover damages from the Company for breaching this Agreement by terminating
the Employment Period without cause, except as otherwise permitted by Paragraph&nbsp;3.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, if the Executive is a &#147;specified employee&#148; for purposes of
409A, no deferred compensation (including without limitation salary continuation payments in
accordance with clause (i)&nbsp;above) payable at separation from service that is not exempt from
application of 409A as a short term deferral or separation pay will be paid to Executive during the
6-month period immediately following the day he ceases active work for the Company, and any such
payments otherwise due during such 6-month period shall be paid on the first business day following
completion of such 6-month period along with simple interest at the six-month Treasury rate in
effect at the beginning of such 6-month period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Non-Competition; Trade Secrets</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Employment Period and for a period of two years after the termination of the
Employment Period, the Executive will not, directly or indirectly:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Disclosure of Information</U>. Use, attempt to use, disclose or otherwise make known
to any person or entity (other than to the Board of Directors of the Company or otherwise in the
course of the business of the Company, its subsidiaries or affiliates and except as may be required
by applicable law):
</DIV>



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. any knowledge or information, including, without limitation, lists of
customers or suppliers, trade secrets, know-how, inventions, discoveries, processes
and formulae, as well as all data and records pertaining thereto, which he may
acquire in the course of his employment, in any manner which may be detrimental to
or cause injury or loss to the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt; margin-left: 4%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. any knowledge or information of a confidential nature (including all
unpublished matters) relating to, without limitation, the business, properties,
accounting, books and records, trade secrets or memoranda of the Company, its
subsidiaries or affiliates, which he now knows or may come to know in any manner
which may be detrimental to or cause injury or loss to the Company its subsidiaries
or affiliates, provided that, the obligations of this Section 8(a) shall not apply
to the extent that the aforesaid matters (a)&nbsp;are disclosed in circumstances where
you are legally required to do so or (b)&nbsp;become generally known to and available for
use by the public otherwise than by your wrongful act or omission.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Non-Competition</U>. Engage or become interested in the United States, Canada, Mexico,
Europe, or Asia (whether as an owner, shareholder, partner, lender or other investor, director,
officer, employee, consultant or otherwise) in the business of distributing electronic parts,
components, supplies or systems, or any other business that is competitive with
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">the principal business or businesses then conducted by the Company, its subsidiaries or
affiliates (provided, however, that nothing contained herein shall prevent the Executive from
acquiring or owning less than 1% of the issued and outstanding capital stock or debentures of a
corporation whose securities are listed on the New York Stock Exchange, American Stock Exchange, or
the National Association of Securities Dealers Automated Quotation System, if such investment is
otherwise permitted by the Company&#146;s Human Resource and Conflict of Interest policies);
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Solicitation</U>. Solicit or participate in the solicitation of any business of any
type conducted by the Company, its subsidiaries or affiliates, during said term or thereafter, from
any person, firm or other entity which was or at the time is a supplier or customer, or prospective
supplier or customer, of the Company, its subsidiaries or affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Employment</U>. Employ or retain, or arrange to have any other person, firm or other
entity employ or retain, or otherwise participate in the employment or retention of, any person who
was an employee or consultant of the Company, its subsidiaries or affiliates, at any time during
the period of twelve consecutive months immediately preceding such employment or retention.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive will promptly furnish in writing to the Company, its subsidiaries or affiliates,
any information reasonably requested by the Company (including any third party confirmations) with
respect to any activity or interest the Executive may have in any business.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly herein provided, nothing contained herein is intended to prevent the
Executive, at any time after the termination of the Employment Period, from either (i)&nbsp;being
gainfully employed or (ii)&nbsp;exercising his skills and abilities outside of such geographic areas,
provided in either case the provisions of this Agreement are complied with.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Preservation of Business</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>General</U>. During the Employment Period, the Executive will use his best efforts to
advance the business and organization of the Company, its subsidiaries and affiliates, to keep
available to the Company, its subsidiaries and affiliates, the services of present and future
employees and to advance the business relations with its suppliers, distributors, customers and
others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Patents and Copyrights, etc.</U> The Executive agrees, without additional
compensation, to make available to the Company all knowledge possessed by him relating to any
methods, developments, inventions, processes, discoveries and/or improvements (whether patented,
patentable or unpatentable) which concern in any way the business of the Company, its subsidiaries
or affiliates, whether acquired by the Executive before or during his employment or retention
hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any methods, developments, inventions, processes, discoveries and/or improvements (whether
patented, patentable or unpatentable) which the Executive may conceive of or make, related directly
or indirectly to the business or affairs of the Company, its subsidiaries or affiliates, or any
part thereof, during the Employment Period, shall be and remain the property of the Company. The
Executive agrees promptly to communicate and disclose all such methods, developments, inventions,
processes, discoveries and/or improvements to the
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">Company and to execute and deliver to it any instruments deemed necessary by the Company to
affect the disclosure and assignment thereof to it. The Executive also agrees, on request and at
the expense of the Company, to execute patent applications and any other instruments deemed
necessary by the Company for the prosecution of such patent applications or the acquisition of
Letters Patent in the United States or any other country and for the assignment to the Company of
any patents which may be issued. The Company shall indemnify and hold the Executive harmless from
any and all costs, expenses, liabilities or damages sustained by the Executive by reason of having
made such patent applications or being granted such patents.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any writings or other materials written or produced by the Executive or under his supervision
(whether alone or with others and whether or not during regular business hours), during the
Employment Period which are related, directly or indirectly, to the business or affairs of the
Company, its subsidiaries or affiliates, or are capable of being used therein, and the copyright
thereof, common law or statutory, including all renewals and extensions, shall be and remain the
property of the Company. The Executive agrees promptly to communicate and disclose all such
writings or materials to the Company and to execute and deliver to it any instruments deemed
necessary by the Company to effect the disclosure and assignment thereof to it. The Executive
further agrees, on request and at the expense of the Company, to take any and all action deemed
necessary by the Company to obtain copyrights or other protections for such writings or other
materials or to protect the Company&#146;s right, title and interest therein. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of the Executive&#146;s compliance with the Company&#146;s request.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Return of Documents</U>. Upon the termination of the Employment Period, including any
termination of employment described in Paragraph&nbsp;7 or Paragraph&nbsp;1(b), the Executive will promptly
return to the Company all copies of information protected by Paragraph 8(a) hereof or pertaining to
matters covered by subparagraph (b)&nbsp;of this Paragraph&nbsp;9 which are in his possession, custody or
control, whether prepared by him or others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Separability</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive agrees that the provisions of Paragraphs 8 and 9 hereof constitute independent
and separable covenants which shall survive the termination of the Employment Period and which
shall be enforceable by the Company notwithstanding any rights or remedies the Executive may have
under any other provisions hereof. The Company agrees that the provisions of Paragraphs 4, 6, and 7
hereof constitute independent and separable covenants which shall survive the termination of the
Employment Period and which shall be enforceable by the Executive notwithstanding any rights or
remedies the Company may have under any other provisions hereof.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Specific Performance</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive acknowledges that (i)&nbsp;the services to be rendered under the provisions of this
Agreement and the obligations of the Executive assumed herein are of a special, unique and
extraordinary character; (ii)&nbsp;it would be difficult or impossible to replace such services and
obligations; (iii)&nbsp;the Company, it subsidiaries and affiliates will be irreparably
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">damaged if the provisions hereof are not specifically enforced; and (iv)&nbsp;the award of monetary
damages will not adequately protect the Company, its subsidiaries and affiliates in the event of a
breach hereof by the Executive. The Company acknowledges that (i)&nbsp;the Executive will be irreparably
damaged if the provisions of Paragraphs 1(b), 4, 6 and 7 hereof are not specifically enforced; and
(ii)&nbsp;the award of monetary damages will not adequately protect the Executive in the event of a
breach thereof by the Company. By virtue thereof, the Executive agrees and consents that if he
violates any of the provisions of this Agreement, and the Company agrees and consents that if it
violates any of the provisions of Paragraphs 1(b), 4, 6, and 7 hereof, the other party, in addition
to any other rights and remedies available under this Agreement or otherwise, shall (without any
bond or other security being required and without the necessity of proving monetary damages) be
entitled to a temporary and/or permanent injunction to be issued by a court of competent
jurisdiction restraining the breaching party from committing or continuing any violation of this
Agreement, or any other appropriate decree of specific performance. Such remedies shall not be
exclusive and shall be in addition to any other remedy which any of them may have.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;<U>Miscellaneous</U>.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <U>Entire Agreement; Amendment</U>. This Agreement constitutes the whole employment
agreement between the parties and may not be modified, amended or terminated except by a written
instrument executed by the parties hereto. It is specifically agreed and understood, however, that
the provisions of that certain letter agreement dated as of December&nbsp;30, 2008, granting to the
Executive extended separation benefits in the event of a change in control of the Company shall
survive and shall not be affected hereby. All other agreements between the parties pertaining to
the employment or remuneration of the Executive not specifically contemplated hereby or
incorporated or merged herein are terminated and shall be of no further force or effect.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <U>Assignment</U>. Except as stated below, this Agreement is not assignable by the
Company without the written consent of the Executive, or by the Executive without the written
consent of the Company, and any purported assignment by either party of such party&#146;s rights and/or
obligations under this Agreement shall be null and void; provided, however, that, notwithstanding
the foregoing, the Company may merge or consolidate with or into another corporation, or sell all
or substantially all of its assets to another corporation or business entity or otherwise
reorganize itself, provided the surviving corporation or entity, if not the Company, shall assume
this Agreement and become obligated to perform all of the terms and conditions hereof, in which
event the Executive&#146;s obligations shall continue in favor of such other corporation or entity.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <U>Waivers, etc.</U> No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any subsequent breach or
default of the same or similar nature. The failure of any party to insist upon strict adherence to
any term of this Agreement on any occasion shall not operate or be construed as a waiver of the
right to insist upon strict adherence to that term or any other term of this Agreement on that or
any other occasion.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->9<!-- /Folio -->
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <U>Provisions Overly Broad</U>. In the event that any term or provision of this Agreement
shall be deemed by a court of competent jurisdiction to be overly broad in scope, duration or area
of applicability, the court considering the same shall have the power and hereby is authorized and
directed to modify such term or provision to limit such scope, duration or area, or all of them, so
that such term or provision is no longer overly broad and to enforce the same as so limited.
Subject to the foregoing sentence, in the event any provision of this Agreement shall be held to be
invalid or unenforceable for any reason, such invalidity or unenforceability shall attach only to
such provision and shall not affect or render invalid or unenforceable any other provision of this
Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <U>Notices</U>. Any notice permitted or required hereunder shall be in writing and shall
be deemed to have been given on the date of actual delivery or, if mailed by registered or
certified mail, postage prepaid, on the date which is three business days after mailing:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Executive to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>William E. Mitchell<br>
223 Atherton Avenue<br>
Atherton, California 94027</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Company to:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Arrow Electronics, Inc.<br>
50 Marcus Drive<br>
Melville, New York 11747<br>
Attention: Peter S. Brown<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President and<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General Counsel</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 10pt">Either party may, by notice to the other, change his or its address for notice hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <U>New York Law</U>. This Agreement shall be construed and governed in all respects by
the internal laws of the State of New York, without giving effect to principles of conflicts of
law.
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
above written.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="64%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">ARROW ELECTRONICS, INC.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">By:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Peter S. Brown
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">Peter S. Brown</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">Senior Vice President and General Counsel</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">THE EXECUTIVE</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">/s/ William E. Mitchell</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD colspan="3" valign="top" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="left">William E. Mitchell</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
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<DOCUMENT>
<TYPE>EX-10.K.VI
<SEQUENCE>6
<FILENAME>y74529exv10wkwvi.htm
<DESCRIPTION>EX-10.K.VI: EMPLOYMENT AGREEMENT
<TEXT>
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10(k)(vi)</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EMPLOYMENT AGREEMENT (the &#147;Agreement&#148;) made as of the 30th day of December, 2008 by and
between ARROW ELECTRONICS, INC., a New York corporation with its principal office at 50 Marcus
Drive, Melville, New York 11747 (the &#147;Company&#148;), and JOHN P. McMAHON, residing 6 Whistler Lane,
Southborough, Massachusetts 01772 (the &#147;Executive&#148;).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Executive, has been employed by the Company, as a Senior Vice President, Human
Resources, with the responsibilities and duties of an executive officer of the Company under an
Employment Agreement dated as of February 1<SUP style="font-size: 85%; vertical-align: text-top">st</SUP>, 2007 (the &#147;Old Agreement&#148;); and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Old Agreement contains provisions that do not comply with section 409A of the
Internal Revenue Code of 1986, as amended, and applicable regulations thereunder (&#147;409A&#148;) and other
provisions that are obsolete; and
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company and Executive wish to novate the Old Agreement and to replace it with
this Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the
parties agree as follows:
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">1. <U>Employment and Duties</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Employment</U>. The Company hereby employs the Executive for the Employment Period
defined in Paragraph&nbsp;3, to perform such duties for the Company and its subsidiaries and affiliates
and to hold such offices as may be specified from time to time by the Company&#146;s Board of Directors,
subject to the following provisions of this Agreement. The Executive hereby accepts such
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Duties and Responsibilities</U>. It is contemplated that the Executive will be a
Senior Vice President, Human Resources, but the Board of Directors shall have the right to adjust
the duties, responsibilities, and title of the Executive as the Board of Directors may from time to
time deem to be in the interests of the Company (provided, however, that during the Employment
Period, without the consent of the Executive, he shall not be assigned any titles, duties or
responsibilities which, in the aggregate, represent a material diminution in, or are materially
inconsistent with, his prior title, duties, and responsibilities as a Senior Vice President, Human
Resources).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Board of Directors does not either continue the Executive in the office of a Senior
Vice President, Human Resources, or elect him to some other executive office satisfactory to the
Executive, the Executive shall have the right to decline to give further service to the Company and
shall have the rights and obligations which would accrue to him under Paragraph&nbsp;6 if he were
discharged without cause. If the Executive decides to exercise such right to decline to give
further service, he shall within forty-five days after such action or omission by the Board of
Directors give written notice to the Company stating his objection and the action he thinks
necessary to correct it, and he shall permit the Company to have a forty-five day period in which
to correct its action or omission. If the Company makes a correction satisfactory to the Executive,
the Executive shall be obligated to continue to serve the Company. If the Company
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">does not make such a correction, the Executive&#146;s rights and obligations under Paragraph&nbsp;6
shall accrue at the expiration of such forty-five day period.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Time Devoted to Duties</U>. The Executive shall devote all of his normal business
time and efforts to the business of the Company, its subsidiaries and its affiliates, the amount of
such time to be sufficient, in the reasonable judgment of the Board of Directors, to permit him
diligently and faithfully to serve and endeavor to further their interests to the best of his
ability.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">2. <U>Compensation</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Monetary Remuneration and Benefits</U>. During the Employment Period, the Company
shall pay to the Executive for all services rendered by him in any capacity:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;a minimum base salary of $375,000 per year (payable in accordance with the
Company&#146;s then
prevailing practices, but in no event less frequently than in equal monthly installments), subject
to increase if the Board of Directors of the Company in its sole discretion so determines; provided
that, should the Company institute a Company-wide pay cut/furlough program, such salary may be
decreased by up to 15%, but only for as long as said Company-wide program is in effect;
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;such additional compensation by way of salary or bonus or fringe benefits as the Board
of
Directors of the Company in its sole discretion shall authorize or agree to pay, payable on such
terms and conditions as it shall determine; and
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;such employee benefits that are made available by the Company to its other executives
generally.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Annual Incentive Payment</U>. The Executive shall participate in the Company&#146;s
Management Incentive Plan (or such alternative, successor, or replacement plan or program in which
the Company&#146;s principal operating executives, other than the Chief Executive Officer, generally
participate) and shall have a targeted incentive thereunder of not less than $225,000 per year,
provided, however, that the Executive&#146;s actual incentive payment for any year shall be measured by
the Company&#146;s performance against goals established for that year and that such performance may
produce an incentive payment ranging from none to 200% of the targeted amount. The Executive&#146;s
incentive payment for any year will be appropriately pro-rated to reflect a partial year of
employment.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Supplemental Executive Retirement Plan</U>. The Executive shall participate in the
Company&#146;s Unfunded Pension Plan for Selected Executives (the &#147;SERP&#148;). The timing of payment under
the SERP shall be in accordance with its terms.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Automobile</U>. While the Executive is actively working for the Company, the Company
will pay the Executive a monthly automobile allowance of $850. Such allowance shall cease when the
Executive&#146;s employment with the Company terminates for any reason.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Expenses</U>. During the Employment Period, the Company agrees to reimburse the
Executive, upon the submission of appropriate vouchers, for out-of-pocket
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">expenses (including, without limitation, expenses for travel, lodging and entertainment)
incurred by the Executive in the course of his duties hereunder in accordance with its expense
reimbursement policy. Any reimbursement that is taxable to Executive shall be paid no later than
the end of the year following the year in which it is incurred.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>Office and Staff</U>. The Company will provide the Executive with an office,
secretary and such other facilities as may be reasonably required for the proper discharge of his
duties hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <U>Indemnification</U>. The Company agrees to indemnify, defend and hold harmless the
Executive for any and all liabilities to which he may be subject as a result of his employment
hereunder (and as a result of his service as an officer or director of the Company, or as an
officer or director of any of its subsidiaries or affiliates), as well as the costs of any legal
action brought or threatened against him as a result of such employment, to the fullest extent
permitted by law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <U>Participation in Plans</U>. Notwithstanding any other provision of this Agreement,
the Executive shall have the right to participate in any and all of the plans or programs made
available by the Company (or it subsidiaries, divisions or affiliates) to, or for the benefit of,
executives (including the annual stock option and restricted stock grant programs) or employees in
general, on a basis consistent with other senior executives.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <U>Rental Subsidy</U>. To assist you with your move to New York, the Company will
provide you with a two-year rental subsidy in the amount of $3,083 per month commencing April&nbsp;2008
and continuing through March&nbsp;2010, payable on the first day of each month.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">3. <U>The Employment Period</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The &#147;Employment Period,&#148; as used in the Agreement, shall mean the period beginning March&nbsp;19,
2007 and terminating on the last day of the calendar month in which the first of the following
occurs:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;the death of the Executive;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;the disability of the Executive as determined in accordance with Paragraph&nbsp;4 hereof and
subject to the provisions thereof;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;the termination of the Executive&#146;s employment by the Company for cause in accordance with
Paragraph&nbsp;5 hereof; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;December&nbsp;31, 2010; provided, however, that, unless sooner terminated as otherwise provided
herein, the Employment Period shall automatically be extended for one or more twelve (12)&nbsp;month
periods beyond the then scheduled expiration date thereof unless between the 18th and 12th month
preceding such scheduled expiration date either the Company or the Executive gives the other
written notice of its or his election not to have the Employment Period so extended.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">4. <U>Disability</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the Executive will be deemed &#147;disabled&#148; if he is absent from
work because he is incapacitated due to an accident or physical or mental impairment, and one of
the following conditions is also satisfied: (i)&nbsp;Executive is expected to return to his duties with
the Company within 6&nbsp;months after the beginning of his absence or (ii)&nbsp;Executive is unable to
perform his duties or those of a substantially similar position of employment due to a
medically-determinable physical or mental impairment which can be expected to result in death or
last for a continuous period of not less than 6&nbsp;months. If the Executive is absent on account of
being disabled (as defined in the preceding sentence), during such absence the Company shall
continue to pay to the Executive his base salary, any additional compensation authorized by the
Company&#146;s Board of Directors, and other remuneration and benefits provided in accordance with
Paragraph&nbsp;2 hereof, all without delay, diminution or proration of any kind whatsoever (except that
his remuneration hereunder shall be reduced by the amount of any payments he may otherwise receive
as a result of his disability pursuant to a disability program provided by or through the Company),
and his medical benefits and life insurance shall remain in full force. Unless terminated earlier
in accordance with Paragraph&nbsp;3(a), (c)&nbsp;or (d), the Employment Period shall end on the
180<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> consecutive day of his disability absence, and Executive&#146;s compensation under
Paragraph&nbsp;2 shall immediately cease, except the medical benefits covering the Executive and his
family shall remain in place (subject to the eligibility requirements and other conditions
contained in the underlying plan, as described in the Company&#146;s employee benefits manual, and
subject to the requirement that the Executive continue to pay the &#147;employee portion&#148; of the cost
thereof), and the Executive&#146;s life insurance policy under the Management Insurance Program shall be
transferred to him, as provided in the related agreement, subject to the obligation of the
Executive to pay the premiums therefor.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that, notwithstanding such a determination of disability, the Executive is
determined not to be totally and permanently disabled prior to the then scheduled expiration of the
Employment Period, the Executive shall be entitled to resume employment with the Company under the
terms of this Agreement for the then remaining balance of the Employment Period.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">5. <U>Termination for Cause</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any malfeasance, willful misconduct, active fraud or gross negligence by the
Executive in connection with his employment hereunder, the Company shall have the right to
terminate the Employment Period by giving the Executive notice in writing of the reason for such
proposed termination. If the Executive shall not have corrected such conduct to the satisfaction of
the Company within thirty days after such notice, the Employment Period shall terminate and the
Company shall have no further obligation to the Executive hereunder but the restriction on the
Executive&#146;s activities contained in Paragraph&nbsp;8 and the obligations of the Executive contained in
Paragraphs 9(b) and 9(c) shall continue in effect as provided therein.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">6. <U>Termination Without Cause</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company discharges the Executive without cause prior to the expiration
of the Employment Period, the Executive&#146;s post-discharge compensation and benefits
</DIV>

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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">will be as follows, subject to the Executive&#146;s execution of a release as set forth in
Paragraph&nbsp;7 below:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Executive will be placed on inactive or &#147;RA&#148; status beginning on the day following his
last day of active work and ending on the earliest of (i)&nbsp;the date the Employment Period was
scheduled to expire, (ii)&nbsp;the day the Executive begins employment for a person or entity other than
the Company, or (iii)&nbsp;the day the Executive fails to observe any provision of this Agreement,
including his obligations under Paragraphs 8 and 9 (the &#147;RA Period&#148;), during which time he will be
paid the salary provided in subparagraph 2(a) on the same schedule as if he still were an active
employee (less the customary deductions), subject to any required delay described in subparagraph
(c)&nbsp;below;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Executive will be paid an amount equal to two-thirds of the targeted incentive
provided in Paragraph 2(b) for the year in which he ceases active employment and for each
succeeding year (or, on a pro rata basis, portion of a year) during the RA Period, payable if the
Executive is still on RA status on the scheduled payment date or, in the case of the year during
which RA status terminates, if the Executive is still on RA status on the last day of the RA
Period. Payment to Executive shall be made at the regular time for payment of such bonuses under
the Company&#146;s Management Incentive Plan, but not later than the March&nbsp;15 following the end of the
relevant performance period, subject to any required delay described in subparagraph (c)&nbsp;below;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Notwithstanding the provisions of subparagraphs (a)&nbsp;and (b)&nbsp;above, if the Executive is a
&#147;specified employee&#148; under section 409A of the Internal Revenue Code of 1986, as amended (&#147;Code&#148;),
no payment of deferred compensation within the meaning Code section 409A that is not exempted from
application of Section&nbsp;409A as an exempt short term deferral or exempt separation pay in accordance
with applicable Treasury regulations will be paid to the Executive on account of his termination of
employment for 6&nbsp;months following the day he ceases active work, and any such payments due during
such 6-month period will be held and paid on the first business day following completion of such
6-month period, along with interest calculated at the 6-month Treasury rate in effect at the
beginning of the RA Period;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Any unvested stock options, restricted stock or performance shares held by the Executive
on his last day of active work that would have vested by the scheduled expiration of the Employment
Period had the Executive not been discharged will vest on his last day of active work subject to
the payment by the Executive of all applicable taxes. Any vested Arrow performance shares will be
paid out in accordance with their terms. Any vested stock option will remain exercisable after the
Executive ceases active work in accordance with the terms of the applicable award relating to
post-termination exercise. Any stock options, performance shares or restricted stock not already
vested on the Executive&#146;s last day of active work or vested on such last day in accordance with
this subparagraph (d)&nbsp;will be forfeited on the Executive&#146;s last day of active work.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;The Executive&#146;s active participation in the Company&#146;s 401(k) Plan, ESOP and SERP will end
on his last day of active work, and he will earn no vesting service and no additional benefits
under those plans after that date. For purposes of receiving a distribution of
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">his vested account balance under the 401(k) plan or ESOP, the Executive will be considered to
have severed from service with the Company on his last day of active work.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;The Executive will remain covered by the Company medical plan during the RA Period under
the same terms and conditions as an active employee. At the end of the RA Period the Executive
will be entitled to continuation coverage for himself and his eligible dependents under the plan&#146;s
COBRA provisions at his own expense. The Executive&#146;s participation in all other welfare benefit
and fringe benefit plans of the Company will end on the day he ceases active work, subject to any
conversion rights generally available to former employees under the terms of such plans.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Any amounts payable to the Executive under this Paragraph&nbsp;6 shall be reduced by the amount of the
Executive&#146;s earnings from other employment (which the Executive shall have an affirmative duty to
seek; provided, however, that the Executive shall not be obligated to accept a new position which
is not reasonable comparable to his employment with the Company).
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">7. <U>Release</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In consideration for the payments and benefits set forth in Paragraph&nbsp;6, Executive agrees to
execute and return to the Company a release in the following form:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;John P. McMahon (the &#147;Executive&#148;) and Arrow Electronics, Inc. and its affiliates (&#147;Arrow&#148;)
each hereby releases the other and its agents, directors and employees from and against any and all
claims (statutory, contractual or otherwise) arising out of the Executive&#146;s employment or the
termination thereof or any discrimination in connection therewith and for any further additional
payments of any kind or nature whatsoever except as expressly set forth in the employment agreement
between the Executive and Arrow dated December&nbsp;30, 2008. Without limiting the foregoing, the
Executive hereby releases Arrow from any claim under the Age Discrimination in Employment Act and
any other similar law. Nothing contained herein will be construed as impacting the Executive&#146;s
right to claim unemployment benefits on account of his termination of employment with Arrow, if
any, or preventing the Executive or Arrow from providing information to or making a claim with any
governmental agency to the extent permitted or required by law. This release will, however,
constitute an absolute bar to the recovery of any damages or additional compensation, consideration
or relief of any kind or nature whatsoever arising out of or in connection with such claim.&#148;
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The executed release required by this Paragraph&nbsp;7 as a condition for payment under Paragraph&nbsp;6
shall be given to the Company no later than 35&nbsp;days following the Executive&#146;s last day of active
work. The Company will provide to the Executive an executed release in the same form promptly upon
receipt of the release signed by the Executive. The Company, in its sole discretion, may delay
payment of any amount otherwise due hereunder pending receipt of such release and expiration of any
applicable revocation period. If the Executive fails to provide the executed release by the
expiration of such 35-day period, the Executive will forfeit any payments or benefits still due
under Paragraph&nbsp;6, including but not limited to any unexercised stock options the vesting of which
was accelerated pursuant to the terms of Paragraph&nbsp;6.
</DIV>


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<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">8. <U>Non-Disclosure; Non-Competition; Trade Secrets</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Employment Period and for a period of two years after the termination of the
Employment Period, the Executive will not, directly or indirectly:
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Disclosure of Information</U>. Use, attempt to use, disclose or otherwise make known
to any person or entity (other than to the Board of Directors of the Company or otherwise in the
course of the business of the Company, its subsidiaries or affiliates and except as may be required
by applicable law):
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;any knowledge or information, including, without limitation, lists of customers or
suppliers, trade secrets, know-how, inventions, discoveries, processes and formulae, as well as all
data and records pertaining thereto, which he may acquire in the course of his employment, in any
manner which may be detrimental to or cause injury or loss to the Company, its subsidiaries or
affiliates; or
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;any knowledge or information of a confidential nature (including alt unpublished
matters)
relating to, without limitation, the business, properties, accounting, books and records, trade
secrets or memoranda of the Company, its subsidiaries or affiliates, which he now knows or may come
to know in any manner which may be detrimental to or cause injury or loss to the Company, its
subsidiaries or affiliates.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Non-Competition</U>. Engage or become interested in the United States, Canada or
Mexico (whether as an owner, shareholder, partner, lender or other investor, director, officer,
employee, consultant or otherwise) in the business of distributing electronic parts, components,
supplies or systems, or any other business that is competitive with the principal business or
businesses then (or, in the case of the post-termination covenant, as of the date of termination)
conducted by the Company, its subsidiaries or affiliates (provided, however, that nothing contained
herein shall prevent the Executive from acquiring or owning less than 1% of the issued and
outstanding capital stock or debentures of a corporation whose securities are listed on the New
York Stock Exchange, American Stock Exchange, or the National Association of Securities Dealers
Automated Quotation System, if such investment is otherwise permitted by the Company&#146;s Human
Resource and Conflict of Interest policies).
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Solicitation</U>. Solicit or participate in the solicitation of any business of any
type conducted by the Company, its subsidiaries or affiliates, during said term or thereafter, from
any person, firm or other entity which is or was at any during the preceding 12&nbsp;months (or, in the
case of the post-termination covenant, during the 12&nbsp;months preceding the date of termination) a
supplier or customer, or prospective supplier or customer, of the Company, its subsidiaries or
affiliates; or
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Employment</U>. Employ or retain, or arrange to have any other person, firm or other
entity employ or retain, or otherwise participate in the employment or retention of, any person who
was an employee or consultant of the Company, its subsidiaries or affiliates, at any time during
the period of twelve consecutive months immediately preceding such employment or retention.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->-7-<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive will promptly furnish in writing to the Company, its subsidiaries or affiliates,
any information reasonably requested by the Company (including any third party confirmations) with
respect to any activity or interest the Executive may have in any business.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly herein provided, nothing contained herein is intended to prevent the
Executive, at any time after the termination of the Employment Period, from either (i)&nbsp;being
gainfully employed or (ii)&nbsp;exercising his skills and abilities outside of such geographic areas,
provided in either case the provisions of this Agreement are complied with.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">9. <U>Preservation of Business</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>General</U>. During the Employment Period, the Executive will use his best efforts to
advance the business and organization of the Company, its subsidiaries and affiliates, to keep
available to the Company, its subsidiaries and affiliates, the services of present and future
employees and to advance the business relations with its suppliers, distributors, customers and
others.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Patents and Copyrights, etc.</U> The Executive agrees, without additional
compensation, to make available to the Company all knowledge possessed by him relating to any
methods, developments, inventions, processes, discoveries and/or improvements (whether patented,
patentable or unpatentable) which concern in any way the business of the Company, its subsidiaries
or affiliates, whether acquired by the Executive before or during his employment hereunder,
provided that the Executive shall not disclose to the Company any such knowledge acquired by the
Executive prior to his employment by the Company and which is owned by a third party.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any methods, developments, inventions, processes, discoveries and/or improvements (whether
patented, patentable or unpatentable) which the Executive may conceive of or make, related directly
or indirectly to the business or affairs of the Company, its subsidiaries or affiliates, or any
part thereof, during the Employment Period, shall be and remain the property of the Company. The
Executive agrees promptly to communicate and disclose all such methods, developments, inventions,
processes, discoveries and/or improvements to the Company and to execute and deliver to it any
instruments deemed necessary by the Company to effect the disclosure and assignment thereof to it.
The Executive also agrees, on request and at the expense of the Company, to execute patent
applications and any other instruments deemed necessary by the Company for the prosecution of such
patent applications or the acquisition of Letters Patent in the United States or any other country
and for the assignment to the Company of any patents which may be issued. The Company shall
indemnify and hold the Executive harmless from any and all costs, expenses, liabilities or damages
sustained by the Executive by reason of having made such patent applications or being granted such
patents.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any writings or other materials written or produced by the Executive or under his supervision
(whether alone or with others and whether or not during regular business hours), during the
Employment Period which are related, directly or indirectly, to the business or affairs of the
Company, its subsidiaries or affiliates, or are capable of being used therein, and the copyright
thereof, common law or statutory, including all renewals and extensions, shall be and remain the
property of the Company. The Executive agrees promptly to communicate and
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->-8-<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">disclose all such writings or materials to the Company and to execute and deliver to it any
instruments deemed necessary by the Company to affect the disclosure and assignment thereof to it.
The Executive further agrees, on request and at the expense of the Company, to take any and all
action deemed necessary by the Company to obtain copyrights or other protections for such writings
or other materials or to protect the Company&#146;s right, title and interest therein. The Company shall
indemnify, defend and hold the Executive harmless from any and all costs, expenses, liabilities or
damages sustained by the Executive by reason of the Executive&#146;s compliance with the Company&#146;s
request
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Return of Documents</U>. Upon the termination of the Employment Period, including any
termination of employment described in Paragraph&nbsp;6, the Executive will promptly return to the
Company all copies of information protected by Paragraph 9(a) hereof or pertaining to matters
covered by subparagraph (b)&nbsp;of this Paragraph&nbsp;9 which are in his possession, custody or control,
whether prepared by him or others.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">10. <U>Separability</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive agrees that the provisions of Paragraphs 8 and 9 hereof constitute independent
and separable covenants which shall survive the termination of the Employment Period and which
shall be enforceable by the Company notwithstanding any rights or remedies the Executive may have
under any other provisions hereof. The Company agrees that the provisions of Paragraph&nbsp;6 hereof
constitute independent and separable covenants which shall survive the termination of the
Employment Period and which shall be enforceable by the Executive notwithstanding any rights or
remedies the Company may have under any other provisions hereof.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">11. <U>Specific Performance</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Executive acknowledges that (i)&nbsp;the services to be rendered under the provisions of this
Agreement and the obligations of the Executive assumed herein are of a special, unique and
extraordinary character; (ii)&nbsp;it would be difficult or impossible to replace such services and
obligations; (iii)&nbsp;the Company, its subsidiaries and affiliates will be irreparably damaged if the
provisions hereof are not specifically enforced; and (iv)&nbsp;the award of monetary damages will not
adequately protect the Company, its subsidiaries and affiliates in the event of a breach hereof by
the Executive. The Company acknowledges that (i)&nbsp;the Executive will be irreparably damaged if the
provisions of Paragraph&nbsp;6 hereof are not specifically enforced and (ii)&nbsp;the award of monetary
damages will not adequately protect the Executive in the event of a breach thereof by the Company.
By virtue thereof, the Executive agrees and consents that if he violates any of the provisions of
this Agreement, and the Company agrees and consents that if it violates any of the provisions of
Paragraph&nbsp;6 hereof, the other party, in addition to any other rights and remedies available under
this Agreement or otherwise, shall (without any bond or other security being required and without
the necessity of proving monetary damages) be entitled to a temporary and/or permanent injunction
to be issued by a court of competent jurisdiction restraining the breaching party from committing
or continuing any violation of this Agreement, or any other appropriate decree of specific
performance. Such remedies shall not be exclusive and shall be in addition to any other remedy
which any of them may have.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->-9-<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">



<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">12. <U>Miscellaneous</U>.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Entire Agreement; Amendment</U>. This Agreement constitutes the whole employment
agreement between the parties and may not be modified, amended or terminated except by a written
instrument executed by the parties hereto. It is specifically agreed and understood, however, that
the provisions of that certain letter agreement dated as of December&nbsp;30, 2008 granting to the
Executive extended separation benefits in the event of a change in control of the Company shall
survive and shall not be affected hereby. All other agreements between the parties pertaining to
the employment or remuneration of the Executive not specifically contemplated hereby or
incorporated or merged herein are terminated and shall be of no further force or effect.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Assignment</U>. Except as stated below, this Agreement is not assignable by the
Company without the written consent of the Executive, or by the Executive without the written
consent of the Company, and any purported assignment by either party of such party&#146;s rights and/or
obligations under this Agreement shall be null and void; provided, however, that, notwithstanding
the foregoing, the Company may merge or consolidate with or into another corporation, or sell all
or substantially all of its assets to another corporation or business entity or otherwise
reorganize itself, provided the surviving corporation or entity, if not the Company, shall assume
this Agreement and become obligated to perform all of the terms and conditions hereof, in which
event the Executive&#146;s obligations shall continue in favor of such other corporation or entity.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Waivers, etc.</U> No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any subsequent breach or
default of the same or similar nature. The failure of any party to insist upon strict adherence to
any term of this Agreement on any occasion shall not operate or be construed as a waiver of the
right to insist upon strict adherence to that term or any other term of this Agreement on that or
any other occasion.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Provisions Overly Broad</U>. In the event that any term or provision of this
Agreement shall be deemed by a court of competent jurisdiction to be overly broad in scope,
duration or area of applicability, the court considering the same shall have the power and hereby
is authorized and directed to modify such term or provision to limit such scope, duration or area,
or all of them, so that such term or provision is no longer overly broad and to enforce the same as
so limited. Subject to the foregoing sentence, in the event any provision of this Agreement shall
be held to be invalid or unenforceable for any reason, such invalidity or unenforceability shall
attach only to such provision and shall not affect or render invalid or unenforceable any other
provision of this Agreement.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Notices</U>. Any notice permitted or required hereunder shall be in writing and shall
be deemed to have been given on the date of delivery or, if mailed by registered or certified mail,
postage prepaid, on the date of mailing:
</DIV>




<P align="center" style="font-size: 10pt"><!-- Folio -->-10-<!-- /Folio -->
</DIV>

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<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV style="margin-top: 6pt" align="right">
<TABLE width="94%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(i)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Executive to:<BR>
John P. McMahon<BR>
6 Whistler Lane<BR>
Southborough, MA 01772</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(ii)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if to the Company to:<BR>
Arrow Electronics, Inc.<BR>
50 Marcus Drive<BR>
Melville, New York 11747<BR>
Attention: Peter S. Brown<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President and<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General Counsel</TD>
</TR>

</TABLE>
</DIV>
<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">Either party may, by notice to the other, change his or its address for notice hereunder.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>New York Law</U>. This Agreement shall be construed and governed in all respects by
the internal laws of the State of New York, without giving effect to principles of conflicts of
law.
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
above written.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>

    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<TR>

    <TD colspan="3" align="left">ARROW ELECTRONICS, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>
</TR><TR>

    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Peter S. Brown
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>

    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Peter S. Brown&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>

    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Senior Vice President &#038;
General Counsel&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3" align="left">THE EXECUTIVE<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top" align="left">&nbsp;</TD>

</TR><TR>

    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ John P. McMahon
&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>

    <TD colspan="3" align="left">John P. McMahon&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->-11-<!-- /Folio -->
</DIV>



</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>7
<FILENAME>y74529exv21.htm
<DESCRIPTION>EX-21: SUBSIDIARY LISTING
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-21</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 21pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics, Inc. a New York corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics International, Inc., a Virgin Islands corporation (old DISC)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Canada Ltd., a Canadian corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Schuylkill Metals of Plant City, Inc., a Delaware corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics International, Inc., a Delaware corporation (old FSC)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">6.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Hi-Tech Ad, Inc., a New York corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">7.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Enterprise Computing Solutions, Inc., a Delaware corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">SN Holding, Inc., a Delaware corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Support Net, Inc., an Indiana corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">SBM Holding, Inc., a Delaware corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Scientific &#038; Business Minicomputers, Inc., a Georgia
corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Alternative Data Technologies, Inc., a Colorado corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">8.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Consan Inc., a Minnesota corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">9.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Funding Corporation, a Delaware corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">10.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Real Estate Inc., a New York corporation</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">11.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (U.K.), Inc., a Delaware corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (Sweden) KB, a Swedish partnership (98% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics South Africa, LLP (1% owned), a South African limited
partnership</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics EMEASA, Inc., a Delaware company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Holdings (Delaware) LLC, a Delaware company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow International Holdings L.P., a Cayman company (1%
owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow International Holdings L.P., a Cayman company (99% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics International Holdings, LLC, a Delaware
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="12%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Holdings Vagyonkezelo, Kft, a
Hungarian company (50% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Holdings Vagyonkezelo, Kft, a Hungarian
company (50% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="12%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics EMEASA S.r.l., an Italian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Europe, LLC, a
Delaware company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">ARW Electronics, Ltd., an Israeli
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow/Rapac, Ltd., an
Israeli company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Services S.r.l., an
Italian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">B.V. Arrow Electronics,
DLC, a Netherlands company (34.35% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">B.V. Arrow Electronics DLC, a
Netherlands company (65.65% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics UK
Holding Ltd., a UK company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow
Electronics (UK)&nbsp;Ltd., a UK company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow
Northern Europe Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Jermyn Holdings Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Hawke Electronics, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Impulse Electronics, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Invader Electromechanical Distribution,
Ltd., a UK company (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Jermyn Development, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">v.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Jermyn Distribution, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">vi.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Jermyn Electronics, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->1<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 20pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">vii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Jermyn Manufacturing, Ltd., a UK
company (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">viii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Mogul Electronics, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">RR Electronics, Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;&nbsp;i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Techdis, Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Microprocessor &#038; Memory Distribution,
Ltd., a UK company (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Rapid Silicon, Ltd., a UK company
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Tekdis, Ltd., a UK company (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Tecdis, Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Axiom Electronics, Ltd., a UK company (dormant)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Multichip
Ltd., a UK company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Microtronica Ltd., a UK company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Europe GmbH, a
German company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Silverstar
S.r.l., an Italian company (95% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Microtronica Italy S.r.l., Italian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">I.R. Electronic D.O.O., a Slovenian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Elektronik Ticaret, A.S., a Turkish
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Hellas S.A., a Greek company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronice S.R.L., a Romanian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">f.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow France, S.A., a French company (77.41%
owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Mircrotronica France Sarl, a French
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">g.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">EDI Electronics Distribution International
France, S.A., a French company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow France, S.A., a French company
(22.59% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">h.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Iberia Electronica, S.L.U., a Spanish
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Microtronica Iberia S.L.U., a Spanish
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Iberia Electronica Lda., a
Portugal company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow
Electronics Danish Holdings ApS, a Danish company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Norwegian Holdings AS, a
Norwegian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Estonia OU, an
Estonian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Jacob Hatteland Electronic II AS, a
Norwegian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Finland OY, a Finnish company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Denmark, ApS, a Danish company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">v.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Components Sweden AB, a Swedish
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="36%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Nordic
Components AB, a Swedish company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">vi.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Norway A/S, a Norwegian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Central
Europe GmbH, a German company</DIV></TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->2<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 0pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 20pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Russ OOO(Russia) (99% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow CE International GmbH, a German company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Industrade AG, a Swiss company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Hungary Kereskedelmi
Bt, a Hungarian company (99% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Spoerle Hungary Kereskedelmi Kft, a
Hungarian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="36%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics
Hungary Kereskedelmi Bt, a Hungarian company (1% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Sasco Holz GmbH, a German company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Czech Republic s.r.o., a Czech
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Poland Sp.z.o.o., a Polish
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">f. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Spoerle Eastern Europe GmbH, a German company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Arrow Electronics Ukraine, LLC, a
Ukrainian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">k.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Slovakia s.r.o (99.1% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Power and
Signal Group GmbH, a German company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">DNSint.com
GmbH, a German company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Digital Network Services Deutschland, a German
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Digital Network Services Sweden AB, a Swedish
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS A/S, a Danish company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Digital Network Services Norway AS, a Norwegian
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
AKS Group A/S (Norway), a Norwegian
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS Finland OY, a Finnish company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">f. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS Polska Sp.z.o.o., a Polish company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
ITL-Polska Sp.z.o.o., a Polish company
(99.2% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">g. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS Hungaria Kft., a Hungarian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">h.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Soft-Tronik a.s., a Czech company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Soft-Tronik SK s.r.o., a Slovakian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">j. </TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Internet Security AG, an Austrian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">k.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS d.o.o., a Croatian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">l.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Digital Network Services (UK)&nbsp;Limited, a UK
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Centia Group Ltd (UK), a UK company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="36%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Centia Ltd (UK), a UK company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">m.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
DNS d.o.o., a Slovenian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">n.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Digital Network Services SRL, a Romanian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">6.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Logix, SAS
(France)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
IP Vista SAS (France)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
High Tech Sources SARL (France)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Finovia SAS (France)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Openway SAS (France)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->3<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 0pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 20pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Asplenium SA (France)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">f.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix E-Solution, Ltd. (Israel)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">g.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Renaissance Electronics Ltd. (Israel)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">h.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix Maroc SARL (Morocco)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix Iberia SL (Spain)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">j.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix Nederland B.V. (Netherlands)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">k.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix Benelux SA NV (Belgium)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">l.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Logix Polska Sp. z.o.o. (Poland)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="28%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">m.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Four Leaf A/S (Denmark)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Four Leaf AS (Norway)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Four Leaf Technologies AS (Denmark)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="36%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">IPVista A/S (Denmark)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Four Leaf OY (Finland)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="32%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">
Four Leaf Technologies AB (Sweden)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">7.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow
Electronics Russ OOO (Russia) (1% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="24%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">8.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow
Electronics Slovakia s.r.o. (0.9%)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics
(Sweden) KB, a Swedish partnership (2% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="20%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Silverstar S.r.l., an
Italian company (5% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">12.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics South Africa LLP (99% owned), a South African limited partnership<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">13.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Altech Holdings (Pty) Ltd. (50.1% owned), a South African company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Altech Distribution (Pty) Ltd., a South African company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Erf 211 Hughes (Pty) Limited, a South African company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">14.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Brasil S.A., a Brazilian company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">15.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Elko C.E., S.A., an Argentinean company (82.63% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">TEC-Tecnologia Ltda, a Brazilian company (99.9% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">16.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Eurocomponentes, S.A., an Argentinean company (82.63% owned) (dormant)<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">17.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Macom, S.A., an Argentinean company (82.63% owned) (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">18.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Compania de Semiconductores y Componentes, S.A., an Argentinean company (82.63% owned)
(dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">19.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Components Agent (Cayman) Limited, a Cayman Islands company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow/Components (Agent) Ltd., a Hong Kong company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;&nbsp;i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (China) Trading Co. Ltd., a Chinese company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics China Ltd., a Hong Kong company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (Shanghai) Co. Ltd., a Chinese company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (Shenzhen) Co. Ltd., a Chinese company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Distribution (Shanghai) Co. Ltd., a Chinese
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">c.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Asia Limited, a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">d.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (S)&nbsp;Pte Ltd, a Singapore company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">e.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Intex-semi Ltd., a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">f.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Asia (S)&nbsp;Pte Ltd., a Singapore company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (Thailand) Limited, a Thailand company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components PTE Ltd. (Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components Sdn Bhd (Malaysia)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components (India) Private Limited
(Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->4<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 0pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 20pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components China Ltd. (Hong Kong)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components Int&#146;l Trading
(Shanghai) Co. Ltd. (China)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components (Taiwan) Ltd. (Taiwan)<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Components Korea Ltd. (Korea)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Electronics PTE Ltd. (Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Achieva Electronics Sdn Bhd (Malaysia)<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">New Tech Electronics Pte. Ltd. (Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">NUTEQ Components PTE Ltd., (Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">ETEQ Components PTE Ltd., (Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="16%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">ETEQ Components International PTE Ltd.
(Singapore)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">g.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics India Ltd., a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">h.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Asia Pac Ltd., a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Kingsview Ltd., a British Virgin Islands company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">j.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Hotung Ltd., a British Virgin Islands company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">k.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Components Agent Asia Holdings, Ltd., a Mauritus company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics India Private Limited, an Indian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">l.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics ANZ Holdings Pty Ltd., an Australian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Holdings Pty Ltd., an Australian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Australia Pty Ltd., an Australian
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Components (NZ), a New Zealand Company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">m.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Labuan Pte Ltd., a Malaysian company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Korea Limited, a South Korean company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Excel Tech, Inc., a Korean company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">n.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Components (M)&nbsp;Sdn Bhd, a Malaysian company<BR></DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">o.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Taiwan Ltd., a Taiwanese company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Strong Pte, Ltd., a Singapore company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Lite-On Korea, Ltd., a Korean company (48.58% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">TLW Electronics, Ltd., a Hong Kong company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Lite-On Korea, Ltd., a Korean company (51.42%
owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">iv.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Creative Model Limited, a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">v.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Ultra Source Technology Corp., a Taiwanese company (92.8%
owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Channel Ware Corp., a Taiwanese company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Ultra Source Technology (B.V.I) Corp., a British
Virgin Islands company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Nuchip Technology Corp., a Taiwanese company
(39.65% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">vi.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Chin Chi Investment Co., Ltd., a Taiwanese company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">20.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Asia Distribution Limited, a Hong Kong company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">21.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Logistics Sdn Bhd, a Malaysian company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">22.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics (CI)&nbsp;Ltd., a Cayman Islands company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">a.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Japan GK, a Japanese company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Universe Electron Corporation</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">b.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow Asia Ltd., a British Virgin Islands company (50% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="10%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">i.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (HK)&nbsp;Limited, a Hong Kong company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="14%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (Shanghai) Co., Ltd., a Chinese
company</DIV></TD>
</TR>



</TABLE>
</DIV>
<P align="center" style="font-size: 10pt"><!-- Folio -->5<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV style="margin-top: 0pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="right" style="font-size: 8pt; margin-top: 12pt"><B>Exhibit&nbsp;21</B>
</DIV>


<DIV align="center" style="font-size: 20pt; margin-top: 18pt"><B>ARROW ELECTRONICS, INC. &#038; SUBSIDIARIES<BR>
Organizational (Legal Entity) Structure</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><B>As of December&nbsp;31, 2008</B></DIV>



<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">ii.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (S)&nbsp;Pte Ltd., a Singapore company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="12%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (Thailand) Co., Ltd., a Thailand
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="12%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (Philippines) Inc., a Filipino
company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="12%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow (M)&nbsp;Sdn. Bhd (Malaysia), a Malaysian
company</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 0pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">23.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun/Arrow USA, LLC, a Delaware limited liability company (50% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">24.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Electronics Mexico, S. de R.L. de C.V., a Mexican company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">25.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Dicopel, Inc., a U.S. company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">26.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Arrow Components Mexico S.A. de C.V., a Mexican company
</DIV></TD>
</TR>
<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">27.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify"> Wyle Electronics, Inc., a Barbados company</DIV></TD>
</TR>


<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">28.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Wyle Electronics de Mexico S de R.L. de C.V., a Mexican company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">29.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Wyle Electronics Caribbean Corp., a Puerto Rican company</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">30.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">eChipsCanada, Inc., a Canadian company (dormant)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">31.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Marubun Corporation, a Japanese company (8.38% owned)</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 0pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">32.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">WPG Holding Co., Ltd., a Taiwanese company (3.3% owned)</DIV></TD>
</TR>

</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->6<!-- /Folio -->
</DIV>



</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>8
<FILENAME>y74529exv23.htm
<DESCRIPTION>EX-23: CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-23</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%"></TD>
    <TD width="5%"></TD>
    <TD width="47%"></TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" valign="top"><B>ARROW ELECTRONICS, INC.</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top"><B>EXHIBIT 23</B></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">We consent to the incorporation by reference in the following Registration Statements and related
prospectuses of Arrow Electronics, Inc., listed below, of our reports
dated February&nbsp;24, 2009, with
respect to the consolidated financial statements and schedule of Arrow Electronics, Inc., and the
effectiveness of internal control over financial reporting of Arrow Electronics, Inc., included in
this Annual Report (Form 10-K) for the year ended December&nbsp;31, 2008:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-left: 3%; margin-top: 10pt">1. Registration Statement (Form&nbsp;S-8 No.&nbsp;333-118563)<BR>
2. Registration Statement (Form&nbsp;S-8 No.&nbsp;333-52872)<BR>
3. Registration Statement (Form&nbsp;S-8 No.&nbsp;333-101534)<BR>
4. Registration Statement (Form&nbsp;S-8 No.&nbsp;333-45631)<BR>
5. Registration Statement (Form&nbsp;S-4 No.&nbsp;333-51100)<BR>
6. Registration Statement (Form&nbsp;S-8 No.&nbsp;333-154719)
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">/s/ ERNST &#038; YOUNG LLP
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt">New York, New York<BR>
February&nbsp;24, 2009

</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.I
<SEQUENCE>9
<FILENAME>y74529exv31wi.htm
<DESCRIPTION>EX-31.I: CERTIFICATION
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-31.I</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;31(i)</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Arrow Electronics, Inc.<BR>
Certification of Chief Executive Officer Pursuant to Section&nbsp;302 of the<BR>
Sarbanes-Oxley Act of 2002</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">I, William E. Mitchell, certify that:
</DIV>


<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">I have reviewed this annual report on Form 10-K of Arrow Electronics, Inc. (the &#147;registrant&#148;);</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Based on my knowledge, this annual 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 annual report;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Based on my knowledge, the financial statements, and other financial information included in this
annual 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 annual
report;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act Rules&nbsp;13a-15(f) and
15d-15(f)) for the registrant and have:</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">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 annual report is being prepared;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">designed such internal control over financial
reporting, or caused such internal control
over financial reporting to be designed under
our supervision, to provide reasonable
assurance regarding the reliability of
financial reporting and the preparation of
financial statements for external purposes in
accordance with generally accepted accounting
principles;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">evaluated the effectiveness of the
registrant&#146;s disclosure controls and
procedures and presented in this annual report
our conclusions about the effectiveness of the
disclosure controls and procedures, as of the
end of the period covered by this annual
report based on such evaluation; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">disclosed in this annual report any change in
the registrant&#146;s internal control over
financial reporting that occurred during the
registrant&#146;s most recent fiscal quarter (the
registrant&#146;s fourth fiscal quarter in the case
of an annual report) that has materially
affected, or is reasonably likely to
materially affect, the registrant&#146;s internal
control over financial reporting; and</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant&#146;s auditors and the audit committee
of the registrant&#146;s board of directors (or persons performing the equivalent functions):</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">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&#146;s ability to record,
process, summarize and report financial
information; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">any fraud, whether or not material, that
involves management or other employees who
have a significant role in the registrant&#146;s
internal control over financial reporting.</DIV></TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: February 26, 2009&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ William E. Mitchell
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;William E. Mitchell&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman and Chief Executive Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.II
<SEQUENCE>10
<FILENAME>y74529exv31wii.htm
<DESCRIPTION>EX-31.II: CERTIFICATION
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-31.II</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;31(ii)</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Arrow Electronics, Inc.<BR>
Certification of Chief Financial Officer Pursuant to Section&nbsp;302 of the<BR>
Sarbanes-Oxley Act of 2002</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">I, Paul J. Reilly, certify that:
</DIV>


<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">I have reviewed this annual report on Form 10-K of Arrow Electronics, Inc. (the &#147;registrant&#148;);</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Based on my knowledge, this annual 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 annual report;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">Based on my knowledge, the financial statements, and other financial information included in this
annual 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 annual
report;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act Rules&nbsp;13a-15(f) and
15d-15(f)) for the registrant and have:</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">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 annual report is being prepared;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">designed such internal control over financial
reporting, or caused such internal control
over financial reporting to be designed under
our supervision, to provide reasonable
assurance regarding the reliability of
financial reporting and the preparation of
financial statements for external purposes in
accordance with generally accepted accounting
principles;</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">evaluated the effectiveness of the
registrant&#146;s disclosure controls and
procedures and presented in this annual report
our conclusions about the effectiveness of the
disclosure controls and procedures, as of the
end of the period covered by this annual
report based on such evaluation; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">disclosed in this annual report any change in
the registrant&#146;s internal control over
financial reporting that occurred during the
registrant&#146;s most recent fiscal quarter (the
registrant&#146;s fourth fiscal quarter in the case
of an annual report) that has materially
affected, or is reasonably likely to
materially affect, the registrant&#146;s internal
control over financial reporting; and</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant&#146;s auditors and the audit committee
of the registrant&#146;s board of directors (or persons performing the equivalent functions):</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">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&#146;s ability to record,
process, summarize and report financial
information; and</DIV></TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">any fraud, whether or not material, that
involves management or other employees who
have a significant role in the registrant&#146;s
internal control over financial reporting.</DIV></TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: February 26, 2009&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Paul J. Reilly
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paul J. Reilly&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President and Chief Financial&nbsp;Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.I
<SEQUENCE>11
<FILENAME>y74529exv32wi.htm
<DESCRIPTION>EX-32.I: CERTIFICATION
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-32.I</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->

<DIV style="font-family: Helvetica,Arial,sans-serif">


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>

<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;32(i)</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Arrow Electronics, Inc.<BR>
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section&nbsp;1350, As Adopted Pursuant<BR>
to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002 (&#147;Section&nbsp;906&#148;)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the Annual Report on Form 10-K of Arrow Electronics, Inc. (the &#147;company&#148;) for
the year ended December&nbsp;31, 2008 (the &#147;Report&#148;), I, William E. Mitchell, Chairman and Chief
Executive Officer of the company, certify, pursuant to the requirements of Section&nbsp;906, that, to
the best of my knowledge:
</DIV>


<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the company.</DIV></TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date:  February 26, 2009&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ William E. Mitchell
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;William E. Mitchell&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chairman and Chief Executive Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">A signed original of this written statement required by Section&nbsp;906, or other document
authenticating, acknowledging, or otherwise adopting the signature that appears in typed form
within the electronic version of this written statement required by Section&nbsp;906, has been provided
to the company and will be retained by the company and furnished to the Securities and Exchange
Commission or its staff upon request.
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

</BODY>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.II
<SEQUENCE>12
<FILENAME>y74529exv32wii.htm
<DESCRIPTION>EX-32.II: CERTIFICATION
<TEXT>
<HTML>
<HEAD>
<TITLE>EX-32.II</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->

<DIV style="font-family: Helvetica,Arial,sans-serif">




<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;32(ii)</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Arrow Electronics, Inc.<BR>
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section&nbsp;1350, As Adopted Pursuant to Section<BR>
906 of the Sarbanes-Oxley Act of 2002 (&#147;Section&nbsp;906&#148;)</B>
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 10pt">In connection with the Annual Report on Form 10-K of Arrow Electronics, Inc. (the &#147;company&#148;) for
the year ended December&nbsp;31, 2008 (the &#147;Report&#148;), I, Paul J. Reilly, Senior Vice President and Chief
Financial Officer of the company, certify, pursuant to the requirements of Section&nbsp;906, that, to
the best of my knowledge:
</DIV>


<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and</DIV></TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><DIV style="text-align: justify">The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the company.</DIV></TD>
</TR>

</TABLE>
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: February 26, 2009&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Paul J. Reilly
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paul J. Reilly&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" nowrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Senior Vice President and Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<DIV align="justify" style="font-size: 10pt; margin-top: 6pt">A signed original of this written statement required by Section&nbsp;906, or other document
authenticating, acknowledging, or otherwise adopting the signature that appears in typed form
within the electronic version of this written statement required by Section&nbsp;906, has been provided
to the company and will be retained by the company and furnished to the Securities and Exchange
Commission or its staff upon request.
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>



</BODY>
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<TYPE>GRAPHIC
<SEQUENCE>13
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`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
