EXHIBIT 10.18
BUSINESS TRANSFER
AGREEMENT
dated December 28, 1998
by and between
MODUS MEDIA INTERNATIONAL KABUSHIKI KAISHA
and
SASATOKU DONNELLEY KABUSHIKI KAISHA
BUSINESS TRANSFER AGREEMENT
---------------------------
THIS AGREEMENT is made as of the 28th day of December, 1998 between
MODUS MEDIA INTERNATIONAL KABUSHIKI KAISHA, a corporation organized and existing
under the laws of Japan, having its principle place of business at ▇-▇▇-▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ("MMIKK); and
SASATOKU DONNELLEY KABUSHIKI KAISHA, a corporation organized and existing under
the laws of Japan, having its place of business at ▇-▇▇-▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇-▇▇,
▇▇▇▇▇, ▇▇▇▇▇ ("SD").
WHEREAS:
-------
A Modus Media International Inc. and Sasatoku Printing Co., Ltd. executed
the Letter of Intent dated ▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇ with respect to
a certain restructuring arrangement of MMIKK which is wholly owned by
Modus Media International Inc.
B. MMIKK and SD wish to enter into this Agreement to record their agreement
with respect to the transfer of the business of MMIKK to SD.
NOW THIS AGREEMENT WITNESSES AS FOLLOWS:
---------------------------------------
1. Definitions
In this Agreement, unless the context otherwise requires:
"Affiliate" means, with respect to any corporation:
(a) any person owning directly or indirectly a majority of outstanding
voting shares or interests of such corporation (such person owning
such shares or interests being hereinafter called the "Parent");
(b) any corporation, limited liability company, partnership, or other
legal entity of which a majority of the outstanding voting shares or
interests are owned directly or indirectly by the Parent; or
1
(c) any other corporation, limited liability company, partnership, or
other legal entity of which a majority of the outstanding voting
shares or interests are owned directly or indirectly by such
corporation,
and, for the purposes of this definition, ownership of voting shares or
interest by a person for the purpose of this definition includes shares or
interests owned directly or indirectly by the person and shares or
interests owned directly or indirectly by one or more affiliates of such
person;
"Transferred Assets" means assets and inventories of MMIKK as of the
Completion Date, to be specified in a report to be prepared by MMIKK in a
form of Exhibit 1 attached hereto and signed by SD in accordance with
Clause 6.2.
"Transferred Business" means the whole of the turnkey services and related
businesses of MMIKK comprising the Transferred Assets and the Transferred
Liabilities;
"Completion Date" means December 31, 1998;
"GAAP" means generally accepted accounting practices and principles in
Japan;
"Transferred Liabilities" means the liabilities of MMIKK as of the
Completion Date, to be specified in a report to be prepared by MMIKK in a
form of Exhibit 1 attached hereto and signed by SD in accordance with
Clause 6.2.
"Purchase Price" means the balance between the Transferred Assets and the
Transferred Liabilities (the price described in the Net Asset Value
Statement of Exhibit 1). Provided; that the value of these Transferred
Assets and Liabilities shall be decided in accordance with the book value
of MMIKK as of the Completion Date. The books and accounts of MMIKK shall
be prepared in accordance with GAAP. The Purchase Price which is decided
based upon the book value as of November 30, 1998 shall be called the
"Provisional Purchase Price" (the price described in the Net Asset Value
Statement of Exhibit 2).
"Transferred Personnel" means each of the individuals specified in Exhibit
3.
2. Execution Date of the Agreement
2
2.1 The parties agree that, on or before December 15, 1998 (or on another date
mutually agreed upon); they shall execute this Agreement.
2.2 In the event that for any reason this Agreement is not executed by December
31, 1998 or such later date as the parties agree, each party may
discontinue negotiations and terminate this Agreement without liability to
the other.
3. Transfer and Purchase Price
---------------------------
3.1 In consideration of the payment of the Purchase Price by SD to MMIKK, MMIKK
will agree to sell the Transferred Business to SD and SD will agree to
purchase the Transferred Business on the Completion Date.
3.2 On or before December 31, 1998, SD shall pay the Provisional Purchase Price
(the price described in the Net Asset Value Statement of Exhibit 2),
calculated by reference to the balance sheet of MMIKK as of November 30,
1998, to MMIKK by telegraphic transfer to such a bank account as MMIKK may
notify to SD. If the transfer of the Transferred Business is not completed
on the Completion Date (or by such later date as the parties may agree),
MMIKK shall refund the Purchase Price to SD. The parties acknowledge and
agree that, based on current projections, they anticipate that the
Provisional Purchase Price shall be 316,213,528 yen.
3.3 Prior to the execution date of this Agreement, MMIKK shall prepare a report
(Exhibit 2) listing the Transferred Assets and the Transferred Liabilities
in reasonable detail based on its balance sheet as of November 30, 1998.
Following the completion of its due diligence review pursuant to Clause
5(a) and, in any event, prior to December 15, 1998, SD shall countersign
such Statement (the Net Asset Value Statement of Exhibit 2) to confirm its
agreement with the list of the Transferred Assets and the Transferred
Liabilities.
4. Completion
----------
4.1 The parties will agree that legal title to all of the Transferred Assets
shall be transferred from MMIKK to SD on the Completion Date and that SD
shall assume all of the Transferred Liabilities on the Completion Date.
3
4.2 Promptly following the date of execution of this Agreement referred to in
Clause 2.1 and, in any event prior to January 4, 1999, MMIKK shall deliver
to SD, and SD shall accept from MMIKK.
(a) all original documents of title in the possession of MMIKK with
respect to the Transferred Assets set forth in Exhibit 2;
(b) possession of the Transferred Assets set forth in Exhibit 2;
(c) a notice addressed to each third party with whom MMIKK has entered
into a contract relating to the Transferred Assets set forth in
Exhibit 2, notifying such third party that MMIKK has assigned its
interest in such contract to SD;
(d) all customer lists in relation to the Transferred Business;
(e) other Transferred Assets to be identified based on the balance sheet
of MMIKK as of December 31, 1998;
4.3 With effect on and from January 1, 1999, SD shall employ the Transferred
Personnel (subject to the agreement of the Transferred Personnel) on terms
and conditions no less favorable than the terms and conditions of
employment provided by SD to its employees as of the Completion Date.
5. Conditions Precedent
--------------------
5.1 It shall be a condition precedent to the obligations of SD to purchase the
Transferred Business that:
(a) SD shall have satisfactorily completed such due diligence with respect
to the Transferred Assets as may be reasonable and normal for a
transaction of this type;
(b) the transfer of the Transferred Business from the MMIKK to the SD shall
have been approved by the shareholders of each of MMIKK and SD, in
accordance with the provisions of the Japanese Commercial Code;
4
(c) a notification of the proposed transfer of the Transferred Business
shall have been filed with the Japanese Fair Trade Commission, and
during the period of 30 days following the date of acceptance of such
filing, the Japanese Fair Trade Commission shall not have raised any
objection to the transfer of the Transferred Business;
(d) the parties shall have received all other required approvals and
consents from governmental authorities and agencies and third parties;
(e) SD shall have obtained financing with respect to the Purchase Price on
terms and conditions reasonably satisfactory to Sasatoku Printing Co.,
Ltd. and Modus Media International Inc.;
(f) SD has received a copy of a consent from each person with whom MMIKK
has entered into a material contract forming part of the Transferred
Assets with respect to the transfer of such contract to SD;
(g) SD has received a copy of a consent from each person to whom MMIKK has
any material Transferred Liability with respect to the assumption of
such Transferred Liability by SD;
(h) the truth and accuracy of all representations and warranties contained
in this Agreement; and
(i) no material change will occur in the business or financial condition
of MMIKK between the date of the accounts (November 30, 1998) referred
to in Clause 6.1 and the date of the Completion Date.
5.2 It shall be a condition precedent to the obligations of MMIKK to sell the
Transferred Business that MMIKK has obtained the approval of its bankers to
the sale of the Transferred Business.
6. Accounts and Purchase Price Adjustment
--------------------------------------
6.1 MMIKK shall prepare a balance sheet showing the financial position of MMIKK
as of November 30, 1998 and attach hereto. Such balance sheet shall be
prepared in accordance with GAAP, but shall not be audited.
5
6.2 Promptly following the Completion Date, MMIKK shall prepare a balance sheet
showing the financial position of MMIKK as of December 31, 1998. MMIKK
shall further prepare a report to show the book value of the Transferred
Assets and the Transferred Liabilities and the current status thereof as
of December 31, 1998 (in a form of Exhibit 1 of this Agreement). The
balance sheet together with the report (Exhibit 1) shall be submitted to
SD, in no event later than January 25, 1999. Immediately after receiving
these documents, SD shall implement an audit thereof, and shall submit
objections to these documents, if any, to MMIKK within 2 weeks of receipt
thereof. In the event that SD agrees to the documents, it shall
countersign the Net Asset Value Statement in Exhibit 1 to confirm its
agreement therewith. Exhibit 1 signed by SD shall be additionally attached
hereto as a formal Exhibit to this Agreement. In the event that the
balance sheet has been prepared in accordance with GAAP, SD shall not be
entitled to make any claim as to the evaluation (book value) of the
Transferred Assets and the Transferred Liabilities. MMIKK shall fully
cooperate with SD, and provide the accountant designated by SD with full
access to books and accounts and other necessary documents as to the
Transferred Assets so that the accountant may be able to perform a
complete audit of the documents. In the event of a dispute between MMIKK
and SD as to the preparation of such balance sheet, MMIKK and SD agree to
accept the decision of the accounting auditor who shall be appointed by
the parties based on their mutual agreement with respect to such matter.
6.3 If there is a discrepancy between the amount of the Provisional Purchase
Price paid by SD pursuant to Clause 3.2 and the amount of the price
described in the Net Asset Value Statement of Exhibit 1 determined by
reference to the December 31, 1998 accounts prepared under Clause 6.2, the
parties shall, on or before March 9, 1999, make such adjustment payments
as may be necessary to ensure that the net amount paid by SD to MMIKK for
the Transferred Business (following such adjustment) equals price
described in the Net Asset Value Statement in Exhibit 1 determined by
reference to the December 31, 1998 accounts (book value) referred to in
Clause 6.2.
7. Obligations of MMIKK
---------------------
7.1 In the event that any difference of book value which exceeds one (1)
million yen arises as to the value of each of the Transferred Assets and/or
each of the Transferred Liabilities between November 30, 1998 and December
31, 1998, such difference shall be respectively set forth in the report
provided for in Clause 6.2.
6
7.2 Between the date of this Agreement and the Completion Date, MMIKK shall:
(a) use its best endeavors to obtain the consent to the transfer of
employment of the Transferred Personnel from MMIKK to SD;
(b) notify SD immediately if it becomes aware of any objection to the
transaction by any of its major creditors; and
(c) use its best endeavors to obtain the consent of applicable third
parties to the assignment of the contracts forming part of the
Transferred Assets and the assumption of the Transferred Liabilities.
8. Guarantee of the Transferred Assets
-----------------------------------
The price for the Transferred Assets shall be guaranteed in accordance
with the arrangement set forth herein based on the status of the
Transferred Assets as of June 30, 1999 (the Standard Date):
8.1 SD shall dispose of the inventories included in the Transferred Assets in
accordance with the steps set forth below by the Standard Date:
(a) To make its best efforts to sell all of the inventories.
(b) To request customers to purchase the inventories.
(c) To request customers to pay storage charges if they do not wish to
purchase the inventories.
In the event that SD has inventories, which do not fall under any
categories set forth above as of the Standard Date, such inventories may be
deemed as obsolete inventories.
8.2 SD shall make its best efforts to collect the account receivable included
in the Transferred Assets by its due date. Despite SD's such effort, if it
has any uncollected account receivable over due because of insolvency of
the debtor, such account receivable may be deemed as a bad debt.
8.3 SD shall submit a list of the obsolete inventories and the bad debts as of
the Standard Date in a form of Exhibit 1 to MMIKK on or before July 5,
1999. A report explaining the situation under which SD found that the
inventories and the account receivable as obsolete inventories and/or bad
debts should be attached to the list.
8.4 MMIKK shall buy back the inventories and the account receivable, which
shall be deemed as obsolete inventories and/or bad debt, for the price set
forth in Exhibit 1 on or before July 15, 1999. Provided, however that the
total price for the obsolete
7
inventories and/or the account receivable shall not exceed six (6)
percent of the total amount of the Transferred Assets as of December 31,
1998 set forth in Exhibit 1. In no event, MMIKK shall be responsible for
purchasing back the obsolete inventories and/or the bad debts in excess of
the amount set forth herein.
8.5 In the event that MMIKK will be liquidated on or before the Standard date,
the guaranty obligation set forth herein shall be assumed by MMI Inc., and
SD shall agree to such transfer or guaranty obligation. In such an event,
MMIKK shall ensure that MMI Inc. shall assume such a guaranty obligation in
writing before MMIKK's liquidation, and SD agrees that it shall not make
any claim against MMIKK in its liquidation proceedings.
9. Access for Due Diligence
------------------------
For the purposes of the due diligence review referred to in Clause 5(a),
MMIKK shall, upon reasonable prior notice and during normal business hours,
grant to SD and to its agents, employees and designees full and complete
access to the books and records and personnel of MMIKK for the purpose of
evaluating the Transferred Business, the Transferred Assets and the
Transferred Liabilities. Except as may be required by law or court order,
all information so obtained, not otherwise already public, will be held in
confidence.
10. Representations and Warranties. Each party represents and warrants to the
------------------------------
other that, as of the date of this Agreement:
(a) it is a corporation duly organized and validly existing under the laws
of its place of incorporation and has all requisite corporate power
and authority to own its assets and to conduct its business in the
manner in which it is now conducted;
(b) it has good and sufficient corporate power and authority to execute
and deliver the Agreement and to perform its obligations thereunder;
and
(c) this Agreement has been duly authorized, executed and delivered by it
and, assuming the due authorization, execution and delivery by the
other party, constitutes its legal, valid and binding obligations
enforceable against it in accordance with its terms.
8
11. Costs and Expenses
------------------
Each party will be responsible for its own expenses in connection with all
matters relating to the transaction contemplated by this Agreement. If the
transactions contemplated by this Agreement are not consummated for any
reason, neither party will be responsible for any of the expenses of the
other party.
12. Counterparts
------------
This Agreement may be signed in any number of counterparts and all such
counterparts taken together shall be deemed to constitute one and the same
document.
13. Governing Law
-------------
This Agreement shall be governed by and construed in all respects in
accordance with the laws of Japan.
14. Jurisdiction
------------
All disputes arising out of or in relation to this Agreement shall be
submitted to the Tokyo District Court for final resolution and each party
hereby submits to the exclusive jurisdiction of the Tokyo District Court
and any courts competent to hear appeals therefrom.
15. Language and Official Version
-----------------------------
This Agreement shall be executed in English language, which language shall
control. A Japanese translation of this Agreement which is verified by both
Parties shall be attached hereto.
9
IN WITNESS WHEREOF the parties have executed this Agreement on the day mentioned
below:
Date: December 28, ▇▇▇▇
▇▇▇▇▇: ▇▇▇▇▇▇▇▇, ▇▇, ▇.▇.▇.
MODUS MEDIA INTERNATIONAL KABUSHIKI KAISHA
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
BY: Director
▇▇▇▇ ▇▇▇▇▇▇▇
Date: December 25, 1998
Place: Tokyo, Japan
SASATOKU DONNELLEY KABUSHIKI KAISHA.
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
BY: Representative Director
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
10
EXHIBIT I
List of Transferred Assets and Transferred Liabilities
And
Net Asset Value Statement
Book Value based on the balance sheet as of December 31, 1998
Item Book Value
--------------------------------------------------------------
Transferred Assets
Item Book Value
--------------------------------------------------------------
Transferred Liabilities
Net Asset Value Statement
We hereby certify that the balance between the Transferred Assets and the
Transferred Liabilities as of December 31, 1998 is the following amount:
Yen
Modus Media International Kabusiki Kaisha
The Representative Director, President: Tasumi Nakano
We hereby approve the price set forth above as the correct balance as of
December 31, 1998.
February 25, 1998
Sasatoku Donnelley Kabusiki Kaisha
The Representative Director, President: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
11
EXHIBIT 2
Net Asset Value Statement
We hereby certify that the balance between the Transferred Assets and the
Transferred Liabilities as of November 30, 1998 is the following amount:
316,213,528 Yen
December 15, 1998
Modus Media International Kabusiki Kaisha
/s/ Tasumi Nakano
-----------------
The Representative Director, President: Tasumi Nakano
We hereby approve the price set forth above as the correct balance as of
November 30, 1998.
December 15, 1998
Sasatoku Donnelley Kabusiki Kaisha
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------
The Representative Director, President: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
13
EXHIBIT 1
EXHIBIT 1 of the Business Transfer Agreement
--------------------------------------------
List of
Transferred Assets and Transferred Liabilities
and
Net Asset Value Statement
15
(Inventory on Book) (yen)
MSKK SUN IBM OEM NAI OTHERS TOTAL
-----------------------------------------------------------------------------------------------------
Ending 14,229,401 132,185,098 43,781,188 25,071,327 4,626,758 24,527,779 244,421,547
------------------------------------------------------------------------------------------------------
Parts 14,229,401 118,330,340 38,403,682 24,703,860 4,622,456 16,851,266 217,141,004
WIP 6,831,226 3,960,550 0 4,300 5,268,485 16,064,562
FG 7,023,531 1,416,955 367,467 0 2,408,028 11,215,981
16
Book Value based on the Balance Sheet as of December 31, 1998
----------------------------------------------------------------------------------------------
Transferred Assets Item Book Value
----------------------------------------------------------------------------------------------
Account receivable
(Please see the attached list in detail) 658,597,368
------------------------------------------------------------------
Inventory
(Please see the attached list in detail) 244,421,547
------------------------------------------------------------------
Fixed Assets
(Please see the attached list in detail) 41,633,360
------------------------------------------------------------------
Sub-total 944,652,275
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
Transferred Liability Item Book Value
----------------------------------------------------------------------------------------------
Account Payable 631,255,283
(Please see the attached list in detail)
-----------------------------------------------------------------
Reserved Fund 56,000,000
-----------------------------------------------------------------
Sub-total 687,255,283
-----------------------------------------------------------------
-----------------------------------------------------------------
Grand Total 257,396,992
-----------------------------------------------------------------
A/R balance as of 12/31/98
Dell Computer 6,706,497
Encyclo Soft 26,520,501
Epson Direct 45,607
Epson Hanbai 4,181,202
Gateway 18,837
Hitachi Kaiyo Engineering 6,605,025
Hitachi Seisakusyo 19,956,553
▇▇▇▇ 8,457,750
IBM Corporation 170,625
JBL 1,057,350
COMPAQ 11,560,845
Matsushita Denchi 1,038,450
Network Associates 5,260,008
Million Enterprise 2,355,402
Nihon Oracle 298,200
Nihon Sun Microsystems 194,380,086
Oki Denki 165,533
Info Creates 18,223,670
PUMA Technology 4,091,630
PFU 4,820,627
Shimane Sanyo 40,398,453
SEAGATE 91,057
Shinshin Syoukai 31,033,774
Sanai Kogyo 3,811,446
Sunsoft Inc. 184,779,150
Forbal Creative 37,286
Fujitsu 67,055,759
Mitsubishi Denki 472,820
Yamashita Denki 302,661
Hewlett Packard 780,342
Haiman Denshi 1,184,400
CM Rogistios 19,215
Ryouden Syouji 636,720
Checkpoint 12,050,901
Soft Bank 12,338
OR CAD 16,648
G-Total 658,597,368
------------------------------------------------------------------------------------------------------------------------------------
COST COST Tax Base Tax Base NHV
DESCRIPTION QTY MO YR ??? REG. BAL. INCREASE DECREASE 11/31/99 LIFE RATE Acc Dep Erp 12/31/98
------------------------------------------------------------------------------------------------------------------------------------
BUILDING
IMPROVEMENTS
------------------------------------------ -------------------------
Air conditioner 3 3 95 4F 8,400,000 - - 8,400,000 10 0.206 4,917,060 3,482,940
------------------------------------------ -------------------------
Vehicle:
FORKLIFT 1.5T 1 9 95 1F 2,550,000 - - 2,550,000 4 0.438 2,163,449 386,551
FORKLIFT 1.5T 1 10 95 1F 2,550,000 - - 2,550,000 4 0.438 2,146,928 403,072
FORKLIFT 1.5T 1 12 93 2F 2,678,000 - - 2,678,000 4 0.438 2,544,100 133,900
FORKLIFT 1.5T 1 1 94 2F 2,678,000 - - 2,678,000 4 0.438 2,544,100 133,900
------------------------------------------ -------------------------
10,456,000 - - 10,456,000 9,398,576 1,057,424
MACHINERY:
Sealer L_Type
#M84161 1 2 95 2F 513,230 - - 513,230 10 0.206 304,837 208,393
Tracer 8000ST_
Q TEST 3 2 95 4F 6,353,876 - - 6,353,876 8 0.250 4,287,625 2,066,251
Disk Labeler
DL3000 4 2 95 4F 6,858,837 - - 6,858,837 10 0.206 4,073,857 2,784,980
Disk Collator
DC600 4 2 95 4F 4,176,322 - - 4,176,322 8 0.250 2,818,202 1,358,120
Belt Conveyor 20 2 95 3F 5,944,000 - - 5,944,000 10 0.206 3,530,483 2,413,517
Weight Checker 5 2 95 3F 4,250,000 - - 4,250,000 5 0.369 3,543,404 706,596
Shrink Wrap Tunnel 5&4 2 95 3F 23,250,000 - - 23,250,000 6 0.319 18,054,326 5,195,674
Taping Machine 5 2 95 3F 2,200,000 - - 2,000,000 6 0.319 1,708,366 491,634
&
Nichyu
Belt Conveyor
FBG3000l 1 2 95 4F 490,000 - - 490,000 10 0.206 291,039 198,961
Trace 3020 System 4&40 2 95 3F 2,584,513 - - 2,584,513 5 0.369 2,154,818 429,695
PALET WRAPPER
SVUMD 1 12 93 1F 3,244,500 - - 3,244,500 8 0.250 2,490,605 753,895
Trace 3020 Complete 4&40 1 94 4F 29,998,346 - - 29,998,346 8 0.250 22,891,149 7,107,197
Magnet Eraser
(▇▇▇▇▇▇) 1 3 94 4F 257,500 - - 257,500 5 0.369 229,231 28,269
------------------------------------------ -------------------------
90,121,124 - - 90,121,124 66,377,942 23,743,182
------------------------------------------ -------------------------
EQUIPMENT:
PC_Compaq Deskpro
(Accg) 4 5 98 - 888,000 888,000 6 0.319 188,848 699,152
PC_Compaq Deskpro 5 7 98 - 990,000 990,000 6 0.319 157,905 832,095
PC_Compaq Deskpro 4 7 98 - 996,000 996,000 6 0.319 158,862 837,138
PC_IBM Think PAD
560X 1 10 98 - 222,380 222,380 6 0.319 17,735 204,645
------------------------------------------ -------------------------
- 3,096,380 3,096,380 523,350 2,573,030
------------------------------------------ -------------------------
SOFTWARE:
Productivity Soft
for disk
monitor 2 95 1,600,000 - - 1,600,000 5 SL 1,253,333 346,667
Productivity Soft
for replication
machine 3 95 647,250 - - 647,250 5 SL 496,225 151,025
Data Base for Power 8 95 4,185,456 - - 4,185,456 5 8L 2,860,062 1,325,394
PID Label Print SW
development 1 2 97 420,000 - - 420,000 5 8L 161,000 259,000
PID Label Print SW
development 2 8 97 1,252,125 - - 1,252,125 5 8L 354,769 897,356
8,104,831 0 0 8,104,831 5,125,389 2,979,442
------------------------------------------ -------------------------
Atsugi Total 117,081,955 3,096,380 0 120,178,335 86,342,317 33,836,017
------------------------------------------ -------------------------
BUILDING
IMPROVEMENT:
Partion 10 96 4,294,100 - - 4,294,100 10 0.206 1,726,363 2,567,737
Partion 12 96 452,400 - - 452,400 10 0.206 172,087 280,313
Partion/Rack
& Storage 12 96 506,100 - - 506,100 8 0.250 227,350 278,750
Office remodiling
'97 restructure 12 97 650,200 - - 650,100 10 0.206 142,804 507,396
Office remodiling
'98 restructure 12 97 1,516,230 - - 1,516,230 10 0.206 333,010 1,183,220
Office remodeling
(98 katiyt chg) 3 98 - 2,585,776 - 2,585,776 10 0.206 443,892 2,141,884
------------------------------------------ -------------------------
7,419,030 2,585,776 - 10,004,806 3,045,506 6,959,300
------------------------------------------ -------------------------
EQUIPMENT:
PC IBM Think Pad 1 3 97 375,988 - - 375,988 6 0.319 188,006 187,980
PC IBM Think Pad 560 1 4 97 378,000 - - 378,000 6 0.319 182,169 195,831
PC IBM Think Pad 560 1 5 97 355,104 - - 355,104 6 0.319 164,706 190,398
PC IBM Think Pad 560 1 12 97 397,999 - - 397,999 6 0.319 134,167 263,832
------------------------------------------ -------------------------
1,507,091 - - 379,999 669,048 838,043
------------------------------------------ -------------------------
------------------------------------------ -------------------------
Ochial Total 8,916,121 2,585,776 0 11,511,897 3,714,554 7,797,343
------------------------------------------ -------------------------
Grand Total 126,008,076 5,682,156 0 131,690,232 90,056,871 41,633,360
=========================================== =========================
ATT JENS 203,070
(SYOUEISHA) T :CORE 7,317,870
A. FUKADA 248,245
APO 54,010,370
ARAI INSATSU 18,900
ASAHI NP 53,025
ATENA 21,483,183
ATR JYUSETSU 16,800
BINDIO 568,488
CANON 30,282
CAREER STAFF 1,851,920
CORP RATE SW 3,696,000
CORRECT 20,475
DAIWA DATA STORAGE 107,415
DHL 13,790
DMS 3,306,457
DOCOMO 60,417
EBISAWA KONPO 3,937,500
▇▇▇▇▇ WORLD 1,110
EPSON HANBAI 21,000
FEDERAL EXPRESS 522,568
FUJITSU APROCO 110,460
FUJITSU LOGISTIX 36,874
FUJITSU XEROX 395,568
FUKUIN RYOKAI 1,575
HEART 1,990,380
HIKARI SHASHIN 7,676,708
HITACHI MAXELL 83,255
HUMAN TOUCH 1,849,594
IKEDA PRINTING 2,873,325
▇▇▇▇ 603,750
INFO CREATES 11,620,875
JYOHOKU SHIKI KONP 784,035
KAMIOCHIAI POST 1,120
KANAGAWA RICOH 94,498
KDD 293,706
KOBAYASI KIROKUSHI 489,510
KOKUSAI ELE 25,200
KOMORI TELENET 37,952
LABEL JAPAN 1,698,125
MAX ENTERPREISE 33,600
MEBIUS 21,636
MEDIA 121,023
MEIKO KASAI 1,528,065
MEMORY TECH 31,356,886
METATECH 2,456,244
MIGHTY WINGS 2,372,348
MIKASA BUNGU 10,246
MILLION ENTERPRISE 2,692,083
MITSUMURA INSATSU 306,600
NEW PACKAGE CENTER 5,966,364
NEXT 2,783,070
NIHON BUSINESS LOGISTICS 2,154,202
NIHON POSTAL ▇▇▇▇▇▇ 7,087
NIKKEI INSATSU 4,267,673
NIKKEN 10,500
NIPPO 126,683
NISSHO 37,380
NITTSU HIRATSUKA 26,728,771
NITTSU INT T (SHINJYUKU) 56,700
NITTSU TOKYO KOHKU 2,186,645
NTT 847,698
OHNO PRINTIN 4,703,186
PACKWELL 38,551,800
PASONA SOFT BANK 695,159
PHIL GRAPHICS 27,300
PHLL GRAPHICS 33,600
PRIPACKS 161,700
PURAPA DEC 158,075
PURCH ACCRUAL 1,722,620
SAGAWA INSATSU 11,885,234
SAGAWA KYUBIN 690,070
SAKAMOTO PRINTING 1,901
▇▇▇▇▇ HEIHAN 431,550
SANWA KASAI 123,743
SASATOKU INSATSU 208,892,768
SASATOKU PRINTING 27,468
SEUTE SEALER 294,525
SHIMANE INSATSU 3,895,071
SHINSHIN SHOKAI 10,688,583
SHOEISHA 8,981,788
SONY MUSIC ENTERTAIN 8,551,463
SUDO HANA 31,500
SUN LIGHT 6,338,913
SYOWA YUKI 190,738
SYUEIDO SHIKOU INSATSU 12,407,903
TEIJIN 14,175,000
TELECOM 82,656
TEMBROS 432,499
TEPCO 1,543,788
TOGIN LEASE 9,682
TOKIWA CORP 16,919,468
TOKYO NICHI 216,300
TOKYU AIR CARGO 15,310
TOPPAN INSATSU 6,059,655
TOSHIBA EMI 15,967,245
TOZAI PACKAGE 237,720
UNI GLOBE 643,080
UNIMAC TONER 29,400
URBAN HOTEL 8,523
US PRINT 777,413
ATSUGI ODAKYU 18,120
BE KIKAKU 211,067
FUJIYA 133,770
FUKUIN IRYOKAI 1,575
HANEDA TURTLE SVC 1,881,339
HARVEST BLDG. MAINT 6,494,797
ITOCHU TECHNO 1,463,070
MITSUBISHI SOKO 11,646,067
NIHON 3RD PARTY 105,000
OTSUKA SYOKAI 161,490
TOKUBETSU KEIBI 42,000
TOPPAN TRAVEL SVC. 110,880
UNIMAT OFFISCO 107,129
UNO TAX ACCOUNTANT 190,000
WATAKON 2,844,345
YU TAKE OFF 15,013,338
631,255,283
Net Asset Value Statement
We hereby certify that the balance between the Transferred Assets and the
Transferred Liabilities as of December 31, 1998 is the following amount:
257,396,992Yen
March 3, 1999
Modus Media International Kabusiki Kaisha
/s/Tatsumi Nakano
Liquidator: Tatsumi Nakano
We hereby approve the price set forth above as the correct balance as of
December 31, 1998.
March 3, 1999
Sasatoku Donnelley Kabusiki Kaisha
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
The Representative Director: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
