Table	of	Contents

# UNITED	STATES

# SECURITIES	AND	EXCHANGE	COMMISSION

(Mark	One)

# ANNUAL	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

# For	the	fiscal	year	ended	December	31,	2017

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

# CDW	CORPORATION

(Exact	name	of	registrant	as	specified	in	its

charter)

Delaware

75	Tri-State	International Lincolnshire,	Illinois

(Address	of	principal	executive	offices)

Title	of	each	class:

Common	stock,	par	value	$0.01	per	share

(Zip	Code)

(Registrant's	telephone	number,	including	area	code)

	Securities	registered	pursuant	to	Section	12(b)	of	the	Act:

	 Name	of	each	exchange	on	which	registered

# 	 Nasdaq	Global	Select	Market

Securities	registered	pursuant	to	Section	12(g)	of	the	Act:	None

Indicate	by	check	mark	if	the	registrant	is	a	well-known	seasoned	issuer,	as	defined	in	Rule	405	of	the	Securities	Act.				 ý		Yes				¨		No

Indicate	by	check	mark	if	the	registrant	is	not	required	to	file	reports	pursuant	to	Section	13	or	Section	15(d)	of	the	Act. ¨		Yes				ý		No

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

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

Indicate	by	check	mark	if	disclosure	of	delinquent	filers	pursuant	to	Item	405	of	Regulation	S-K	(§	229.405)	is	not	contained	herein,	and	will	not	be	contained,	to	the	best	of	registrant's	knowledge,	in definitive	proxy	or	information	statements	incorporated	by	reference	in	Part	III	of	this	Form	10-K	or	any	amendment	to	this	Form	10-K.		ý

Indicate	by	check	mark	whether	the	registrant	is	a	large	accelerated	filer,	an	accelerated	filer,	a	non-accelerated	filer,	a	smaller	reporting	company,	or	emerging	growth	company.	See	the	definitions	of "large	accelerated	filer,"	"accelerated	filer,"	"smaller	reporting	company,"	and	"emerging	growth	company"	in	Rule	12b-2	of	the	Exchange	Act	(Check	one):

Large	accelerated	filer ý

Non-accelerated	filer ¨	(Do	not	check	if	a	smaller	reporting	company)

Accelerated	filer

Smaller	reporting	company ¨

Emerging	growth	company ¨

If	an	emerging	growth	company,	indicate	by	check	mark	if	the	registrant	has	elected	not	to	use	the	extended	transition	period	for	complying	with	any	new	or	revised	financial	accounting	standards provided	pursuant	to	Section	13(a)	of	the	Exchange	Act.				¨

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

The	aggregate	market	value	of	the	voting	and	non-voting	common	equity	held	by	non-affiliates	of	the	registrant	as	of	June	30,	2017,	the	last	business	day	of	the	registrant's	most	recently	completed second	fiscal	quarter,	was	$9,577.6	million,	based	on	the	per	share	closing	sale	price	of	 $62.53	on	that	date.

# DOCUMENTS	INCORPORATED	BY	REFERENCE

Certain	parts	of	the	registrant's	definitive	proxy	statement	for	its	2018	annual	meeting	of	stockholders	to	be	held	on	May	23,	2018	("2018	Proxy	Statement"),	which	will	be	filed	with	the	Securities and	Exchange	Commission	on	or	before	April	30,	2018,	are	incorporated	by	reference	into	Part	III	of	this	Annual	Report	on	Form	10-K.

# CDW	CORPORATION	AND	SUBSIDIARIES

# ANNUAL	REPORT	ON	FORM	10-K

| Item |  | Page |
| :--- | :--- | :--- |
| PART\tI |  |  |
| Item\t1. | Business | 4 |
| Item\t1A. | Risk\tFactors | 9 |
| Item\t1B. | Unresolved\tStaff\tComments | 19 |
| Item\t2. | Properties | 19 |
| Item\t3. | Legal\tProceedings | 19 |
| Item\t4. | Mine\tSafety\tDisclosures | 20 |
|  | Executive\tOfficers | 20 |
| PART\tII |  |  |
| Item\t5. | Market\tfor\tRegistrant's\tCommon\tEquity,\tRelated\tStockholder\tMatters\tand\tIssuer\tPurchases\tof\tEquity\tSecurities | 23 |
| Item\t6. | Selected\tFinancial\tData | 25 |
| Item\t7. | Management's\tDiscussion\tand\tAnalysis\tof\tFinancial\tCondition\tand\tResults\tof\tOperations | 29 |
| Item\t7A. | Quantitative\tand\tQualitative\tDisclosures\tAbout\tMarket\tRisk | 55 |
| Item\t8. | Financial\tStatements\tand\tSupplementary\tData | 56 |
| Item\t9. | Changes\tin\tand\tDisagreements\tWith\tAccountants\ton\tAccounting\tand\tFinancial\tDisclosure | 103 |
| Item\t9A. | Controls\tand\tProcedures | 103 |
| Item\t9B. | Other\tInformation | 105 |
| PART\tIII |  |  |
| Item\t10. | Directors,\tExecutive\tOfficers\tand\tCorporate\tGovernance | 106 |
| Item\t11. | Executive\tCompensation | 106 |
| Item\t12. | Security\tOwnership\tof\tCertain\tBeneficial\tOwners\tand\tManagement\tand\tRelated\tStockholder\tMatters | 106 |
| Item\t13. | Certain\tRelationships\tand\tRelated\tTransactions,\tand\tDirector\tIndependence | 106 |
| Item\t14. | Principal\tAccountant\tFees\tand\tServices | 106 |
| PART\tIV |  |  |
| Item\t15. | Exhibits\tand\tFinancial\tStatement\tSchedules | 107 |
| Item\t16. | Form\t10-K\tSummary | 112 |
| SIGNATURES |  | 113 |

# FORWARD-LOOKING	STATEMENTS

This	report	contains	forward-looking	statements	within	the	meaning	of	the	federal	securities	laws.	All	statements	other	than	statements	of	historical	fact included	in	this	report	are	forward-looking	statements.	These	statements	relate	to	analyses	and	other	information,	which	are	based	on	forecasts	of	future	results	and estimates	of	amounts	not	yet	determinable.	These	statements	also	relate	to	our	future	prospects,	developments	and	business	strategies.	We	claim	the	protection	of	The Private	Securities	Litigation	Reform	Act	of	1995	for	all	forward-looking	statements	in	this	report.

These	forward-looking	statements	are	identified	by	the	use	of	terms	and	phrases	such	as	"anticipate,"	"believe,"	"could,"	"estimate,"	"expect,"	"intend," "may,"	"plan,"	"predict,"	"project,"	"should,"	"will"	and	similar	terms	and	phrases,	including	references	to	assumptions.	However,	these	words	are	not	the	exclusive means	of	identifying	such	statements.	Although	we	believe	that	our	plans,	intentions	and	expectations	reflected	in	or	suggested	by	such	forward-looking	statements	are reasonable,	we	cannot	assure	you	that	we	will	achieve	those	plans,	intentions	or	expectations.	All	forward-looking	statements	are	subject	to	risks	and	uncertainties	that may	cause	actual	results	to	differ	materially	from	those	that	we	expected.

Important	factors	that	could	cause	actual	results	to	differ	materially	from	our	expectations,	or	cautionary	statements,	are	disclosed	under	the	section	entitled "Risk	Factors"	included	elsewhere	in	this	report.	All	written	and	oral	forward-looking	statements	attributable	to	us,	or	persons	acting	on	our	behalf,	are	expressly qualified	in	their	entirety	by	the	cautionary	statements	contained	in	the	section	entitled	"Risk	Factors"	included	elsewhere	in	this	report	as	well	as	other	cautionary statements	that	are	made	from	time	to	time	in	our	other	Securities	and	Exchange	Commission	("SEC")	filings	and	public	communications.	You	should	evaluate	all forward-looking	statements	made	in	this	report	in	the	context	of	these	risks	and	uncertainties.

We	caution	you	that	the	important	factors	referenced	above	may	not	contain	all	of	the	factors	that	could	cause	actual	results	to	differ	from	our	expectations.	In addition,	we	cannot	assure	you	that	we	will	realize	the	results	or	developments	we	expect	or	anticipate	or,	even	if	substantially	realized,	that	they	will	result	in	the consequences	or	affect	us	or	our	operations	in	the	way	we	expect.	The	forward-looking	statements	included	in	this	report	are	made	only	as	of	the	date	hereof.	We undertake	no	obligation	to	publicly	update	or	revise	any	forward-looking	statement	as	a	result	of	new	information,	future	events	or	otherwise,	except	as	otherwise required	by	law.

# PART	I

# Item	1.	Business

# Our	Company

CDW	Corporation	(together	with	its	subsidiaries,	the	"Company,"	"CDW"	or	"we")	is	a	Fortune	500	company	and	a	leading	provider	of	integrated	information technology	("IT")	solutions	to	small,	medium	and	large	business,	government,	education	and	healthcare	customers	in	the	United	States	("US"),	Canada,	and	the	United Kingdom	("UK").	Our	broad	array	of	offerings	ranges	from	discrete	hardware	and	software	products	to	integrated	IT	solutions	such	as	mobility,	security,	data	center optimization,	cloud	computing,	virtualization	and	collaboration.

We	are	technology	"agnostic,"	with	a	solutions	portfolio	including	more	than	100,000	products	and	services	from	more	 than	1,000	leading	and	emerging brands.	Our	solutions	are	delivered	in	physical,	virtual	and	cloud-based	environments	through	over	6,000	customer-facing	coworkers,	including	sellers,	highly-skilled technology	specialists	and	advanced	service	delivery	engineers.	We	are	a	leading	sales	channel	partner	for	many	original	equipment	manufacturers	("OEMs"),	software publishers	and	cloud	providers	(collectively,	our	"vendor	partners"),	whose	products	we	sell	or	include	in	the	solutions	we	offer.	We	provide	our	vendor	partners	with	a cost-effective	way	to	reach	customers	and	deliver	a	consistent	brand	experience	through	our	established	end-market	coverage,	technical	expertise	and	extensive	customer access.

We	simplify	the	complexities	of	technology	across	design,	selection,	procurement,	integration	and	management	for	our	customers.	Our	goal	is	to	have	our customers,	regardless	of	their	size,	view	us	as	a	trusted	adviser	and	extension	of	their	IT	resources.	We	do	not	manufacture	products.	Our	multi-brand	offering	approach enables	us	to	identify	the	products	or	combination	of	products	from	our	vendor	partners	that	best	address	each	customer's	specific	IT	requirements.

We	provide	integrated	IT	solutions	in	more	than	80	countries	for	customers	with	primary	locations	in	the	US,	UK	and	Canada,	which	are	large	and	growing markets.	According	to	the	International	Data	Corporation	("IDC"),	the	total	US,	UK	and	Canadian	IT	market	generated	approximately	$925	billion	in	sales	in	2017.	We believe	our	addressable	markets	in	the	US,	UK	and	Canada	represent	approximately	$300	billion	in	annual	sales.	These	are	highly	fragmented	markets	served	by thousands	of	IT	resellers	and	solutions	providers.	For	the	year	ended	December	31,	2017,	we	estimate	that	our	total	Net	sales	of	$15	billion	represented	approximately 5%	of	our	addressable	markets.	We	believe	that	demand	for	IT	will	continue	to	outpace	general	economic	growth	in	the	markets	we	serve	fueled	by	new	technologies, including	cloud	computing,	virtualization	and	mobility,	as	well	as	growing	end-user	demand	for	security,	efficiency	and	productivity.

# Value	Proposition

We	are	positioned	in	the	middle	of	the	IT	ecosystem	where	we	procure	products	from	OEMs,	software	publishers,	cloud	providers	and	wholesale	distributors and	provide	added	value	to	our	customers	by	helping	them	navigate	through	complex	options	and	implement	the	best	solution	for	their	business.	In	this	role,	we	believe we	provide	unique	value	to	both	our	vendor	partners	and	our	customers.

# Our	value	proposition	to	our	customers

●Broad	selection	of	products	and	multi-branded	IT	solutions ●Value-added	services	with	integration	capabilities

●Highly-skilled	specialists	and	engineers

●Solutions	across	a	very	broad	IT	landscape

# Our	value	proposition	to	our	vendor	partners

●Large	and	established	customer	channels

●Strong	distribution	and	implementation	capabilities

●Value-added	solutions	and	marketing	programs	that	generate	end-user demand

# Customers

We	provide	integrated	IT	solutions	to	over	250,000	small,	medium	and	large	business,	government,	education	and	healthcare	customers	throughout	the	US,	UK and	Canada.

We	serve	our	customers	through	sales	teams	focused	on	customer	end-markets	that	are	supported	by	technical	specialists	and	highly	skilled	service	delivery engineers.	Our	market	segmentation	allows	us	to	customize	our	offerings	and	to	provide	enhanced	expertise	in	designing	and	implementing	IT	solutions	that	meet	our customer's	specific	needs.

In	our	US	business,	which	represents	approximately	90%	of	our	revenues,	we	currently	have	five	dedicated	customer	channels:	corporate,	small	business, government,	education	and	healthcare,	each	of	which	generated	over	$1.0	billion	in	Net	sales	in	2017.	Net	sales	to	customers	in	the	UK	and	Canada	combined	generated $1.6	billion	in	2017.	We	believe	this	diversity	of

customer	end-markets	provides	us	with	multiple	avenues	for	growth	and	has	been	a	key	factor	in	our	ability	to	weather	economic	and	technology	cycles	and	continue	to gain	market	share.

Information	regarding	our	reportable	segments	and	our	customer	channels	is	as	follows:

| Customer	Channels | Corporate<br>Segment | Small	Business<br>Segment | Government | Education | Healthcare | Other |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| \tTarget\tCustomers | &gt;250\temployees | 1\t-\t250\temployees | Various\tfederal,\tstate\tand | Higher\teducation | Hospitals,\tambulatory\tservice | UK\tand\tCanada |
|  |  |  | local\tagencies | and\tK-12 | providers\tand\tlong-term\tcare |  |
|  |  |  |  |  | facilities |  |
| 2017\tNet\tSales | $6.3 | $1.2 | $2.2 | $2.2 | $1.7 | $1.6 |

For	further	information	regarding	our	segments,	including	financial	results,	see	Note	18	(Segment	Information)	to	the	accompanying	Consolidated	Financial Statements	under	Item	8,	"Financial	Statements	and	Supplementary	Data."

# Partners

We	provide	more	than	100,000	products	and	services	from	more	than	1,000	partners,	including	well-established	companies	such	as	Adobe,	APC,	Apple,	Cisco, Dell	EMC,	Google,	Hewlett	Packard	Enterprise,	HP	Inc.,	IBM,	Intel,	Lenovo,	Microsoft,	NetApp,	Samsung,	Symantec	and	VMware,	as	well	as	from	emerging technology	companies	such	as	Calabrio,	Cohesity,	Crowdstrike,	Nutanix,	Proofpoint,	Snow,	Splunk,	Veeam,	Viptella	and	WidePoint.	This	broad	portfolio	of	partners and	technologies	enables	us	to	offer	customers	significant	choice	and	meet	customer	demand	for	the	products	and	solutions	that	best	meet	their	needs.	We	believe	our value	proposition	to	vendor	partners	enables	us	to	evolve	our	offering	as	new	technologies	emerge	and	new	companies	seek	us	as	a	channel	partner.

In	2017,	we	generated	over	$1.0	billion	of	Net	sales	from	each	of	five	of	our	vendor	partners	and	over	$100	million	of	revenue	from	each	of	thirteen	other vendor	partners.	We	have	received	the	highest	level	of	certification	from	major	vendor	partners	such	as	Cisco,	Dell	EMC,	Hewlett	Packard	Enterprise	and	Microsoft, which	reflects	the	extensive	product	and	solution	knowledge	and	capabilities	that	we	bring	to	our	customers'	IT	challenges.	These	certifications	also	provide	us	with access	to	favorable	pricing,	tools	and	resources,	including	vendor	incentive	programs,	which	we	use	to	provide	additional	value	to	our	customers.	Our	vendor	partners also	regularly	recognize	us	with	top	awards	and	select	us	to	develop	and	grow	new	customer	solutions.

# Product	Procurement

We	may	purchase	all	or	only	some	of	the	products	our	vendor	partners	offer	for	resale	to	our	customers	or	for	inclusion	in	the	solutions	we	offer.	Each	vendor partner	agreement	provides	for	specific	terms	and	conditions,	which	may	include	one	or	more	of	the	following:	product	return	privileges,	price	protection	policies, purchase	discounts	and	vendor	incentive	programs,	such	as,	purchase	or	sales	rebates	and	cooperative	advertising	reimbursements.	We	also	purchase	software	from major	software	publishers	and	cloud	providers	for	resale	to	our	customers	or	for	inclusion	in	the	solutions	we	offer.	Our	agreements	allow	the	end-user	customer	to acquire	cloud-based	solutions	software	or	licensed	products	and	services.

In	addition	to	purchasing	products	directly	from	our	vendor	partners,	we	purchase	products	from	wholesale	distributors	for	resale	to	our	customers	or	for inclusion	in	the	solutions	we	offer.	These	wholesale	distributors	provide	logistics	management	and	supply-chain	services	for	us,	as	well	as	for	our	vendor	partners.

For	our	US	operations,	we	purchased	approximately	50%	of	the	products	we	sold	as	discrete	products	or	as	components	of	a	solution	directly	from	our	vendor partners	and	the	remaining	50%	from	wholesale	distributors	for	the	year	ended	December	31,	2017.	Purchases	from	our	three	largest	wholesale	distributors,	Ingram Micro,	SYNNEX	and	Tech	Data,	are	each	approximately	10%	of	total	2017	purchases.

# Inventory	Management

We	operate	two	distribution	centers	in	North	America:	a	513,000	square	foot	facility	in	North	Las	Vegas,	Nevada,	and	a	442,000	square	foot	facility	in	Vernon Hills,	Illinois.	We	also	operate	a	120,000	square	foot	distribution	center	in	Rugby,	Warwickshire,	UK.	We	ship	over	40	million	units	annually	on	an	aggregate	basis	from our	distribution	centers.

We	also	have	drop-shipment	arrangements	with	many	of	our	OEMs	and	wholesale	distributors,	which	permit	us	to	offer	products	to	our	customers	without having	 to	 take	 physical	 delivery	 at	 our	 distribution	 centers.	 These	 arrangements	 represent	 approximately	 50%	 of	 total	 consolidated	 2017	 Net	 sales,	 of	 which approximately	25%	relate	to	electronic	delivery	for	software	licenses.

We	believe	that	the	location	of	our	distribution	centers	allows	us	to	efficiently	ship	products	to	our	customers	and	provide	timely	access	to	our	principal distributors.

We	believe	competitive	sources	of	supply	are	available	in	substantially	all	of	the	product	categories	that	we	offer.

# Competition

The	market	for	technology	products	and	services	is	highly	competitive	and	subject	to	economic	conditions	and	rapid	technological	changes.	Competition	is based	on	many	things,	including	the	ability	to	tailor	specific	solutions	to	customer	needs,	the	quality	and	breadth	of	product	and	service	offerings,	knowledge	and expertise	of	sales	force,	customer	service,	price,	product	availability,	speed	of	delivery	and	credit	availability.	We	face	competition	from	resellers,	direct	manufacturers, large	service	providers,	cloud	providers,	telecommunication	companies,	and	to	a	lesser	extent	e-tailers	and	retailers.	Smaller,	local	or	regional	value	added	resellers typically	focus	on	a	single	solution	suite	or	portfolio	of	solutions	from	one	or	two	vendor	partners.

We	believe	we	are	well	positioned	to	compete	within	this	marketplace	due	to	our	competitive	advantages.	We	expect	the	competitive	landscape	in	which	we compete	to	continue	to	evolve	as	new	technologies	are	developed.	While	innovation	can	help	our	business	as	it	creates	new	offerings	for	us	to	sell,	it	can	also	disrupt	our business	model	and	create	new	and	stronger	competitors.	For	a	discussion	of	the	risks	associated	with	competition,	see	Item	1A,	"Risk	Factors."

We	believe	we	have	sustainable	competitive	advantages	that	differentiate	us	in	the	marketplace.		We	have	built	a	strong	sales	organization	and	deep	services and	solutions	capabilities	over	time	and	expect	to	continue	to	invest	to	enhance	these	capabilities,	which	we	believe	when	combined	with	our	competitive	advantages	of scale	and	a	performance	driven	culture,	will	help	drive	sustainable,	profitable	growth	for	us	today	and	in	the	future.	Our	scale	enables	us	to	have	a	national	and international	footprint,	as	well	as	invest	in	resources	to	meet	specific	customer	end-market	needs.	Our	sellers	are	organized	around	unique	customer	end-markets	that	are both	vertically	and	geographically	focused.	Our	scale	enables	our	ability	to	invest	in	technical	coworkers	who	work	directly	with	our	sellers	to	help	customers	implement increasingly	complex	IT	solutions.	Our	scale	also	enables	us	to	operate	our	three	distribution	centers	(two	in	the	US	and	one	in	the	UK)	which	combined	are	more	than	1 million	square	feet	in	size.	With	the	acquisition	of	CDW	UK	in	2015,	we	have	cross-border	relationships	that	enable	us	to	serve	the	needs	of	our	US,	UK	and	Canadian- based	customers	in	more	than	80	countries.	Our	strong,	execution-oriented	culture	is	underpinned	by	our	compensation	system.

# Our	Offerings

Our	offerings	range	from	discrete	hardware	and	software	products	and	services	to	complex	integrated	solutions	including	one	or	more	of	these	elements.	We believe	our	customers	increasingly	view	technology	purchases	as	integrated	solutions	rather	than	discrete	product	and	service	categories.	We	estimate	that	more	than 40%	 of	 our	 Net	 sales	 in	2017	 in	 the	US	came	from	sales	of	product	categories	and	services	 typically	associated	with	solutions.	Our	hardware	products	 include notebooks/mobile	devices	(including	tablets),	network	communications,	desktop	computers,	video	monitors,	enterprise	and	data	storage,	printers	and	servers.	Our software	products	include	application	suites,	security,	virtualization,	operating	systems	and	network	management.	Our	services	include	warranties,	managed	services, consulting	design	and	implementation.

Today,	IT	is	critical	to	both	"run	the	business"	and	drive	greater	growth	and	productivity.	To	help	our	customers	accomplish	their	goals,	we	have	built	a	robust portfolio	of	solutions	across	data	center,	digital	workspace,	security,	virtualization	and	services	that	we	provide	in	physical,	virtual,	or	cloud-based	environments.

We	provide	public	cloud	solutions,	which	reside	off	customer	premises	on	a	public	(shared)	infrastructure,	and	private	cloud	solutions,	which	reside	on customer	premises.	We	also	offer	hybrid	cloud	solutions	that	deliver	the	benefits	of	both	public	and	private	solutions.	Our	migration,	integration	and	managed	services offerings	help	our	customers	simplify	cloud	adoption,	as	well	as	the	ongoing	management	of	cloud	solutions	across	the	entire	IT	lifecycle.	Dedicated	Cloud	Client Executives	work	with	our	customers	to	architect	cloud	solutions	meeting	their	organizational,	technology	and	financial	objectives.

We	offer	a	broad	portfolio	of	integrated	solutions	that	include	the	following	on	and	off-premise	capabilities:

•Data	Center:	We	assess	our	customers	data	center	needs,	design	flexible,	resilient	and	efficient	solutions	and	manage	the	solution	throughout	its	lifecycle.	Our broad	portfolio	of	hardware	and	software,	for	both	on	and	off-premise	solutions,	enables	us	to	provide	a	well-integrated	solution,	including	converged	and hyper-converged	infrastructure,	physical	and	virtualized	servers,	software	defined	data	center,	storage	and	energy-efficient	power	and	cooling.

•Digital	 Workspace:	We	build	end-to-end	solutions,	using	hardware,	software	and	services,	that	deliver	access	to	applications	that	improve	our	customers' productivity	regardless	of	device	or	location.	We	connect	our	customers'	physical	devices,	including	laptops,	desktops,	IP	Phones,	mobile	devices	and	print systems,	and	utilize	solutions	to	unite

collaboration	and	applications.	We	do	this	through	the	integration	of	products	that	facilitate	the	use	of	multiple	enterprise	communication	methods	including email,	 persistent	 chat,	 social	 media,	 voice	 and	 video.	We	 also	 host	 cloud-based	 collaboration	 solutions.	 Our	 solutions	 provide	 the	 tools	 that	 allow	 our customers'	employees	to	share	knowledge,	ideas	and	information	among	each	other	and	with	clients	and	partners	effectively,	securely	and	quickly.

•Security:	We	assess	the	security	needs	of	our	customers	and	provide	them	with	risk	mitigation	tools	and	services	across	a	multitude	of	categories	such	as: endpoint	security,	email	security,	web	security,	intrusion	prevention,	authentication,	firewall,	virtual	private	network	services	and	network	access	control. Security	consulting	engagements	include	security	assessment,	policy	and	procedure	gap	analysis	and	development	of	security	roadmaps.

•Virtualization:	We	 design	 and	 implement	 server,	 storage	 and	 desktop	 virtualization	 solutions.	Virtualization	 enables	 our	 customers	 to	 efficiently	 utilize hardware	resources	by	running	multiple,	independent,	virtual	operating	systems	on	a	single	computer	and	multiple	virtual	servers	simultaneously	on	a	single server.	Virtualization	also	can	separate	a	desktop	environment	and	associated	application	software	from	the	hardware	device	that	is	used	to	access	it,	and provides	employees	with	remote	desktop	access.	Our	specialists	assist	customers	with	the	steps	of	implementing	virtualization	solutions,	including	evaluating network	environments,	deploying	shared	storage	options	and	licensing	platform	software.

•Services:	We	advise	on,	architect	and	manage	integrated	business	technology	for	commercial	and	business	organizations.	Our	solutions	include	integrated cloud,	collaboration,	data	center,	mobility	and	security	business	technology,	from	the	physical	to	the	application	layer.	We	provide	advisory,	architectural	and managed	services	across	basic,	discrete	and	integrated	business	technology	solutions.	We	leverage	best-in-class	partner	technology	platforms	to	seamlessly architect	and	manage	disparate	IT	platforms	into	integrated	business	technology	solutions.

Although	we	believe	customers	increasingly	view	technology	purchases	as	solutions	rather	than	discrete	product	and	service	categories,	our	Net	sales	by	major category,	based	upon	our	internal	category	classifications	was	as	follows:

|  | Dollars	in<br>Millions | Percentage<br>of	Total	Net	Sales | Dollars	in<br>Millions | Percentage<br>of	Total	Net	Sales | Dollars	in<br>Millions | Percentage<br>of	Total	Net	Sales |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Notebooks/Mobile\tDevices | $3,490.9 | 23.1% | $2,921.6 | 20.9% | $2,537.3 | 19.5% |
| Netcomm\tProducts | 2,042.9 | 13.4 | 1,958.2 | 14.0 | 1,915.0 | 14.7 |
| Desktops | 1,159.4 | 7.6 | 1,050.0 | 7.5 | 965.6 | 7.4 |
| Video | 1,076.9 | 7.1 | 962.1 | 6.9 | 853.8 | 6.6 |
| Enterprise\tand\tData\tStorage\t(Including\nDrives) | 1,071.5 | 7.1 | 1,053.1 | 7.5 | 1,067.2 | 8.2 |
| Other\tHardware | 3,100.3 | 20.4 | 3,042.6 | 21.8 | 2,950.5 | 22.7 |
| Total\tHardware | 11,941.9 | 78.7 | 10,987.6 | 78.6 | 10,289.4 | 79.1 |
| Software(2) | 2,540.1 | 16.7 | 2,389.3 | 17.1 | 2,152.3 | 16.6 |
| Services(2) | 611.3 | 4.0 | 575.1 | 4.1 | 467.7 | 3.6 |
| Other(3) | 98.2 | 0.6 | 29.9 | 0.2 | 79.3 | 0.7 |
| Total\tNet\tsales | $15,191.5 | 100.0% | $13,981.9 | 100.0% | $12,988.7 | 100.0% |

(1) Amounts	have	been	reclassified	for	changes	in	individual	product	classifications	to	conform	to	the	presentation	for	the	year	ended	December	31, 2017.

(2) Certain	software	and	services	revenue	is	recorded	on	a	net	basis	for	accounting	purposes,	so	the	category	percentage	of	net	revenues	is	not	representative	of	the category	percentage	of	gross	profits.

(3) Includes items such as delivery charges to customers and certain commission revenue.

# Our	Internal	Capabilities

# Our	Coworkers

As	of	December	31,	2017,	we	employed	8,726	coworkers	with	approximately	7,200	coworkers	in	the	US,	1,100	in	the	UK	and	400	in	Canada.	Approximately two	thirds	of	our	coworkers	at	year-end	2017	were	customer	facing.	Over	half	of	our	Net	sales	are	generated	by	account	managers	who	have	greater	than	seven	years	of experience.	Account	managers	are	supported	by	field	sellers,	highly	skilled	technology	specialists	and	advanced	service	delivery	engineers.	We	believe	this	structure	to be	core	to	our	ability	to	continue	to	offer	complex	IT	solutions	and	services.

None	of	our	coworkers	are	covered	by	collective	bargaining	agreements.	We	consider	our	coworker	relations	to	be	good.

# Marketing

We	market	the	CDW	brand	to	US,	British	and	Canadian	audiences	using	a	variety	of	channels	that	include	online,	broadcast,	print,	social	and	other	media.	We market	to	current	and	prospective	customers	through	integrated	marketing	programs	including	behaviorally	targeted	email,	print,	online	media,	events	and	sponsorships, as	well	as	broadcast	media.	This	promotion	is	also	supported	by	integrated	communication	efforts	targeting	decision-makers,	influencers	and	the	general	public	using	a combination	of	news	releases,	case	studies,	media	interviews	and	speaking	opportunities.

As	a	result	of	our	relationships	with	our	vendor	partners,	a	significant	portion	of	our	advertising	and	marketing	expenses	is	reimbursed	through	cooperative advertising	programs.	These	programs	are	at	the	discretion	of	our	vendor	partners	and	are	typically	tied	to	sales	or	other	commitments	to	be	met	by	us	within	a	specified period	of	time.	We	believe	that	our	results	and	analytical	techniques	that	measure	the	efficacy	of	our	marketing	programs	differentiate	us	from	our	competitors.

# Information	Technology	Systems

We	maintain	customized	IT	and	unified	communication	systems	that	enhance	our	ability	to	provide	prompt,	efficient	and	expert	service	to	our	customers.	In addition,	these	systems	enable	centralized	management	of	key	functions,	including	purchasing,	inventory	management,	billing	and	collection	of	accounts	receivable, sales	and	distribution.	Our	systems	provide	us	with	thorough,	detailed	and	real-time	information	regarding	key	aspects	of	our	business.	This	capability	helps	us	to continuously	enhance	productivity,	ship	customer	orders	quickly	and	efficiently,	respond	appropriately	to	industry	changes	and	provide	high	levels	of	customer	service. We	believe	our	websites,	which	provide	electronic	order	processing	and	advanced	tools,	such	as	order	tracking,	reporting	and	asset	management,	make	it	easy	for customers	to	transact	business	with	us	and	ultimately	strengthen	our	customer	relationships.

# Intellectual	Property

The	CDW	trademark	and	certain	variations	thereon	are	registered	or	subject	to	pending	trademark	applications	in	the	US,	UK,	Canada	and	certain	other jurisdictions.	We	believe	our	trademarks	have	significant	value	and	are	important	factors	in	our	marketing	programs.	In	addition,	we	own	registrations	for	domain names,	including	cdw.com	and	cdwg.com	and	variations	thereon,	for	certain	of	our	primary	trademarks.	We	also	own	patent	rights	and	have	unregistered	copyrights	in our	website	content,	software	and	other	written	materials.

# History

Founded	in	1984,	CDW	became	a	public	company	in	1993.	In	2003,	we	purchased	selected	US	assets	and	the	Canadian	operations	of	Micro	Warehouse,	which extended	our	growth	platform	into	Canada.	In	2006,	we	acquired	Berbee	Information	Networks	Corporation,	a	regional	provider	of	technology	products,	solutions	and customized	 engineering	 services	 in	 advanced	 technologies	 primarily	 across	 Cisco,	 IBM	 and	 Microsoft	 portfolios.	 This	 acquisition	 increased	 our	 capabilities	 in customized	engineering	services	and	managed	services.

We	were	a	public	company	from	1993	until	2007	when	we	were	acquired	through	a	merger	transaction	by	an	entity	controlled	by	investment	funds	affiliated with	Madison	Dearborn	Partners,	LLC	("Madison	Dearborn")	and	Providence	Equity	Partners	L.L.C.	("Providence	Equity").	CDW	Corporation	continued	as	 the surviving	corporation	and	same	legal	entity	after	the	acquisition,	but	became	a	wholly	owned	subsidiary	of	VH	Holdings,	Inc.,	a	Delaware	corporation.

In	July	2013,	CDW	Corporation	completed	the	IPO	of	its	common	stock.

After	the	IPO,	through	secondary	offerings	and	fund	distributions,	Madison	Dearborn	and	Providence	Equity	liquidated	their	previous	ownership	positions	in CDW.

In	November	2014,	we	completed	 the	acquisition	of	a	35%	non-controlling	equity	 interest	 in	UK-based	IT	solutions	provider,	Kelway	TopCo	Limited ("Kelway").	In	August	2015,	we	purchased	the	remaining	65%	of	Kelway's	outstanding	common	stock,	which	increased	our	ownership	interest	from	35%	to	100%	and provided	us	control.	Rebranded	CDW	UK	in	April	2016,	the	acquisition	extended	our	footprint	into	the	UK.	It	also	enhanced	our	ability	to	provide	IT	solutions	to	US- based	customers	with	multinational	locations.	Financial	results	of	CDW	UK	are	included	in	our	Consolidated	Financial	Statements	from	the	date	of	acquisition.

# Available	Information

We	maintain	a	website	at	www.cdw.com.	You	may	access	our	Annual	Reports	on	Form	10-K,	Quarterly	Reports	on	Form	10-Q,	Current	Reports	on	Form	8-K and	amendments	to	those	reports	filed	or	furnished	pursuant	to	Section	13(a)	or	15(d)	of	the	Securities	Exchange	Act	of	1934	with	the	SEC	free	of	charge	at	our	website as	soon	as	reasonably	practicable	after	such	material	is	electronically	filed	with,	or	furnished	to,	the	SEC.	Our	website	and	the	information	contained	on	that	site,	or connected	to	that	site,	are	not	incorporated	into	and	are	not	a	part	of	this	report.

# Item	1A.	Risk	Factors

There	are	many	factors	that	could	adversely	affect	our	business,	results	of	operations	and	cash	flows,	some	of	which	are	beyond	our	control.	The	following	is	a description	of	some	important	factors	that	may	cause	our	business	prospects,	results	of	operations	and	cash	flows	in	future	periods	to	differ	materially	from	those currently	expected	or	desired.	Factors	not	currently	known	to	us	or	that	we	currently	deem	to	be	immaterial	may	also	materially	and	adversely	affect	our	business, results	of	operations	and	cash	flows.

# Risks	Related	to	Our	Business

# Global	and	regional	economic	and	political	conditions	may	have	an	adverse	impact	on	our	business.

Weak	economic	conditions	generally,	sustained	uncertainty	about	global	economic	and	political	conditions,	government	spending	cuts	and	the	impact	of	new government	policies,	or	a	tightening	of	credit	markets,	could	cause	our	customers	and	potential	customers	to	postpone	or	reduce	spending	on	technology	products	or services	or	put	downward	pressure	on	prices,	which	could	have	an	adverse	effect	on	our	business,	results	of	operations	or	cash	flows.	For	example,	there	continues	to	be substantial	uncertainty	regarding	the	economic	impact	of	the	Referendum	on	the	UK's	Membership	of	the	European	Union	("EU")	advising	for	the	exit	of	the	UK	from the	EU	(referred	to	as	"Brexit").	Potential	adverse	consequences	of	Brexit	such	as	global	market	uncertainty,	volatility	in	currency	exchange	rates,	greater	restrictions	on imports	and	exports	between	UK	and	EU	countries	and	increased	regulatory	complexities	could	have	a	negative	impact	on	our	business,	financial	condition	and	results of	operations.

# Our	financial	performance	could	be	adversely	affected	by	decreases	in	spending	on	technology	products	and	services	by	our	public	sector	customers.

Our	sales	to	our	public	sector	customers	are	impacted	by	government	spending	policies,	budget	priorities	and	revenue	levels.	An	adverse	change	in	government spending	policies	(such	as	budget	cuts	or	limitations),	budget	priorities	or	revenue	levels	could	cause	our	public	sector	customers	to	reduce	their	purchases	or	to terminate	or	not	renew	their	contracts	with	us,	which	could	adversely	affect	our	business,	results	of	operations	or	cash	flows.	For	example,	in	2013,	as	a	result	of sequestration	and	related	budget	uncertainty	and	the	partial	shutdown	of	the	US	federal	government	for	16	days,	we	experienced	significantly	reduced	US	Federal	sales in	our	Public	segment.

# Our	business	depends	on	our	vendor	partner	relationships	and	the	availability	of	their	products.

We	 purchase	 products	 for	 resale	 from	 vendor	 partners,	 which	 include	 OEMs	 and	 software	 publishers,	 and	 wholesale	 distributors.	 For	 the	 year	 ended December	31,	2017,	we	purchased	approximately	50%	of	the	products	we	sold	directly	from	vendor	partners	and	the	remaining	amount	from	wholesale	distributors	for our	North	American	operations.	We	are	authorized	by	vendor	partners	to	sell	all	or	some	of	their	products	via	direct	marketing	activities.	Our	authorization	with	each vendor	partner	is	subject	to	specific	terms	and	conditions	regarding	such	things	as	sales	channel	restrictions,	product	return	privileges,	price	protection	policies,	purchase discounts	and	vendor	partner	programs	and	funding,	including	purchase	rebates,	sales	volume	rebates,	purchasing	incentives	and	cooperative	advertising	reimbursements. However,	we	do	not	have	any	long-term	contracts	with	our	vendor	partners	and	many	of	these	arrangements	are	terminable	upon	notice	by	either	party.	A	reduction	in vendor	partner	programs	or	funding	or	our	failure	to	timely	react	to	changes	in	vendor	partner	programs	or	funding	could	have	an	adverse	effect	on	our	business,	results of	operations	or	cash	flows.	In	addition,	a	reduction	in	the	amount	of	credit	granted	to	us	by	our	vendor	partners	could	increase	our	need	for,	and	the	cost	of,	working capital	and	could	have	an	adverse	effect	on	our	business,	results	of	operations	or	cash	flows,	particularly	given	our	substantial	indebtedness.

From	time	to	time,	vendor	partners	may	terminate	or	limit	our	right	to	sell	some	or	all	of	their	products	or	change	the	terms	and	conditions	or	reduce	or discontinue	the	incentives	that	they	offer	us.	For	example,	there	is	no	assurance	that,	as	our	vendor	partners	continue	to	sell	directly	to	end	users	and	through	resellers, they	will	not	limit	or	curtail	the	availability	of	their	products	to	solutions	providers	like	us.	Any	such	termination	or	limitation	or	the	implementation	of	such	changes could	have	a	negative	impact	on	our	business,	results	of	operations	or	cash	flows.

Although	we	purchase	from	a	diverse	vendor	base,	in	2017,	products	we	purchased	from	wholesale	distributors	Ingram	Micro,	SYNNEX	and	Tech	Data	each represented	approximately	10%	of	total	US	purchases.	In	addition,	sales	of	products	manufactured	by	Apple,	Cisco,	Dell	EMC,	Hewlett	Packard	Enterprise,	HP	Inc., Lenovo	and	Microsoft,	whether	purchased	directly	from	these	vendor	partners	or	from	a	wholesale	distributor,	represented	in	the	aggregate	nearly	60%	of	our	2017 consolidated	Net	sales.	Sales	of	products	manufactured	by	Cisco	and	HP	Inc.	represented	over	25%	of	our	2017	consolidated	Net	sales.	The	loss	of,	or	change	in business	relationship	with,	any	of	these	or	any	other	key	vendor	partners,	or	the	diminished	availability	of	their	products,	including	due	to	backlogs	for	their	products leading	to	manufacturer	allocation,	could	reduce	the	supply	and	increase	the	cost	of	products	we	sell	and	negatively	impact	our	competitive	position.

Additionally,	the	relocation	of	key	distributors	utilized	in	our	purchasing	model	could	increase	our	need	for,	and	the	cost	of,	working	capital	and	have	an adverse	effect	on	our	business,	results	of	operations	or	cash	flows.	Further,	the	sale,	spin-off	or	combination	of	any	of	our	vendor	partners	and/or	certain	of	their	business units,	including	any	such	sale	to	or	combination	with	a	vendor	with	whom	we	do	not	currently	have	a	commercial	relationship	or	whose	products	we	do	not	sell,	could have	an	adverse	impact	on	our	business,	results	of	operations	or	cash	flows.

# Our	sales	are	dependent	on	continued	innovations	in	hardware,	software	and	services	offerings	by	our	vendor	partners	and	the	competitiveness	of	their	offerings, and	our	ability	to	partner	with	new	and	emerging	technology	providers.

The	technology	industry	is	characterized	by	rapid	innovation	and	the	frequent	introduction	of	new	and	enhanced	hardware,	software	and	services	offerings, such	as	cloud-based	solutions,	including	SaaS,	Infrastructure	as	a	Service	("IaaS")	and	Platform	as	a	Service	("PaaS"),	Device	as	a	Service	("DaaS")	and	the	Internet	of Things	("IoT").	We	have	been	and	will	continue	to	be	dependent	on	innovations	in	hardware,	software	and	services	offerings,	as	well	as	the	acceptance	of	those innovations	by	customers.	Also,	customers	may	delay	spending	while	they	evaluate	new	technologies.	A	decrease	in	the	rate	of	innovation,	or	the	lack	of	acceptance	of innovations	or	delays	in	technology	spending	by	customers,	could	have	an	adverse	effect	on	our	business,	results	of	operations	or	cash	flows.

In	addition,	 if	we	are	unable	 to	keep	up	with	changes	 in	 technology	and	new	hardware,	software	and	services	offerings,	for	example	by	providing	 the appropriate	training	to	our	account	managers,	sales	technology	specialists	and	engineers	to	enable	them	to	effectively	sell	and	deliver	such	new	offerings	to	customers, our	business,	results	of	operations	or	cash	flows	could	be	adversely	affected.

We	also	are	dependent	upon	our	vendor	partners	for	the	development	and	marketing	of	hardware,	software	and	services	to	compete	effectively	with	hardware, software	and	services	of	vendors	whose	products	and	services	we	do	not	currently	offer	or	that	we	are	not	authorized	to	offer	in	one	or	more	customer	channels.	In addition,	our	success	is	dependent	on	our	ability	to	develop	relationships	with	and	sell	hardware,	software	and	services	from	new	emerging	vendors	and	vendors	that	we have	not	historically	represented	in	the	marketplace.	To	the	extent	that	a	vendor's	offering	that	is	highly	in	demand	is	not	available	to	us	for	resale	in	one	or	more customer	channels,	and	there	is	not	a	competitive	offering	from	another	vendor	that	we	are	authorized	to	sell	in	such	customer	channels,	or	we	are	unable	to	develop relationships	with	new	technology	providers	or	companies	that	we	have	not	historically	represented,	our	business,	results	of	operations	or	cash	flows	could	be	adversely impacted.

# Substantial	competition	could	reduce	our	market	share	and	significantly	harm	our	financial	performance.

# Our	current	competition	includes:

•resellers,	such	as	Computacenter,	Connection,	Dimension	Data,	ePlus,	Insight	Enterprises,	PCM,	Presidio,	SCC,	Softchoice,	World	Wide	Technology	and	many smaller	resellers;

•manufacturers	 who sell	 directly to customers, such as	 Adobe,	 Apple,	 Dell,	 HP Inc. and	 Hewlett	 Packard Enterprise;

•large	service	providers	and	system	integrators,	such	as	Accenture,	Dell,	Hewlett	Packard	Enterprise	and IBM;

•communications service providers, such as	 AT&T, CenturyLink and Verizon;

•cloud	 providers, such as Amazon	 Web Services, Box and Microsoft;

•e-tailers, such	 as	 Amazon,	 Newegg	 and	 TigerDirect.com; and

•retailers (including their e-commerce activities), such as	 Office	 Depot and Staples.

We	expect	the	competitive	landscape	to	continue	to	evolve	as	new	technologies	are	developed,	such	as	cloud-based	solutions,	hyper-converged	infrastructure and	embedded	software	solutions.	While	innovation	can	help	our	business	as	it	creates	new	offerings	for	us	to	sell,	it	can	also	disrupt	our	business	model	and	create	new and	stronger	competitors.	For	instance,	while	cloud-based	solutions	present	an	opportunity	for	us,	cloud-based	solutions	and	technologies	that	deliver	technology solutions	as	a	service	could	increase	the	amount	of	sales	directly	to	customers	rather	than	through	solutions	providers	like	us,	or	could	reduce	the	amount	of	hardware	we sell.	In	addition,	some	of	our	hardware	and	software	vendor	partners	sell,	and	could	intensify	their	efforts	to	sell,	their	products	directly	to	our	customers.	Moreover, traditional	OEMs	have	increased	their	services	capabilities	through	mergers	and	acquisitions	with	service	providers,	which	could	potentially	increase	competition	in	the market	to	provide	comprehensive	technology	solutions	to	customers.	If	we	are	unable	to	effectively	respond	to	the	evolving	competitive	landscape,	our	business,	results of	operations	or	cash	flows	could	be	adversely	impacted.

We	focus	on	offering	a	high	level	of	service	to	gain	new	customers	and	retain	existing	customers.	To	the	extent	we	face	increased	competition	to	gain	and	retain customers,	we	may	be	required	to	reduce	prices,	increase	advertising	expenditures	or	take	other	actions	which	could	adversely	affect	our	business,	results	of	operations or	cash	flows.	Additionally,	some	of	our	competitors	may	reduce	their	prices	in	an	attempt	to	stimulate	sales,	which	may	require	us	to	reduce	prices.	This	would	require us	to	sell	a	greater	number	of	products	to	achieve	the	same	level	of	Net	sales	and	Gross	profit.	If	such	a	reduction	in	prices	occurs	and	we	are	unable	to	attract	new customers	and	sell	increased	quantities	of	products,	our	sales	growth	and	profitability	could	be	adversely	affected.

# The	success	of	our	business	depends	on	the	continuing	development,	maintenance	and	operation	of	our	information	technology	systems.

Our	success	is	dependent	on	the	accuracy,	proper	utilization	and	continuing	development	of	our	information	technology	systems,	including	our	business systems,	such	as	our	sales,	customer	management,	financial	and	accounting,	marketing,	purchasing,	warehouse	management,	e-commerce	and	mobile	systems,	as	well as	our	operational	platforms,	including	voice	and	data	networks	and	power	systems.	The	quality	and	our	utilization	of	the	information	generated	by	our	information technology	systems,	and	our	success	in	implementing	new	systems	and	upgrades,	affects,	among	other	things,	our	ability	to:

•conduct	 business	 with	 our	 customers, including	 delivering	 services	 and	 solutions to them;

•manage our inventory and accounts receivable and accounts payable;

•purchase,	sell,	ship	and	invoice	our	hardware	and	software	products	and	provide	and	invoice	our	services	efficiently	and	on	a	timely	basis; and

•maintain our cost-efficient operating model while scaling our business.

The	integrity	of	our	information	technology	systems	is	vulnerable	to	disruption	due	to	forces	beyond	our	control.	While	we	have	taken	steps	to	protect	our information	technology	systems	from	a	variety	of	threats,	both	internal	and	external,	and	human	error,	there	can	be	no	guarantee	that	those	steps	will	be	effective. Furthermore,	although	we	have	redundant	systems	at	a	separate	location	to	back	up	our	primary	systems,	there	can	be	no	assurance	that	these	redundant	systems	will operate	properly	if	and	when	required.	Any	disruption	to	or	infiltration	of	our	information	technology	systems	could	significantly	harm	our	business	and	results	of operations.

# Breaches	of	data	security	and	the	failure	to	protect	our	information	technology	systems	from	cybersecurity	threats	could	adversely	impact	our	business.

Our	business	involves	the	storage	and	transmission	of	proprietary	information	and	sensitive	or	confidential	data,	including	personal	information	of	coworkers, customers	and	others.	In	addition,	we	operate	data	centers	for	our	customers	that	host	their	technology	infrastructure	and	may	store	and	transmit	both	business-critical data	and	confidential	information.	In	connection	with	our	services	business,	some	of	our	coworkers	also	have	access	to	our	customers'	confidential	data	and	other information.	We	have	privacy	and	data	security	policies	in	place	that	are	designed	to	prevent	security	breaches;	however,	as	newer	technologies	evolve,	and	the	portfolio of	the	service	providers	we	share	confidential	information	with	grows,	we	could	be	exposed	to	increased	risk	of	breaches	in	security	and	other	illegal	or	fraudulent	acts, including	cyberattacks.	The	evolving	nature	of	such	threats,	in	light	of	new	and	sophisticated	methods	used	by	criminals	and	cyberterrorists,	including	computer	viruses, malware,	phishing,	misrepresentation,	social	engineering	and	forgery,	are	making	it	increasingly	challenging	to	anticipate	and	adequately	mitigate	these	risks.

Breaches	in	security	could	expose	us,	our	supply	chain,	our	customers	or	other	individuals	to	significant	disruptions,	a	risk	of	public	disclosure,	loss	or	misuse of	 this	 information.	Security	breaches	could	result	 in	 legal	claims	or	proceedings,	 liability	or	regulatory	penalties	under	 laws	protecting	 the	privacy	of	personal information,	as	well	as	the	loss	of	existing	or	potential	customers	and	damage	to	our	brand	and	reputation.	Moreover,	media	or	other	reports	of	perceived	vulnerabilities in	our	network	security	or	perceived	lack	of	security	within	our	environment,	even	if	inaccurate,	could	adversely	impact	our	reputation	and	materially	impact	our business.	The	cost	and	operational	consequences	of	implementing	further	data	protection	measures	could	be	significant.	Such	breaches,	costs	and	consequences	could adversely	affect	our	business,	results	of	operations	or	cash	flows.

# The	failure	to	comply	with	our	public	sector	contracts	or	applicable	laws	and	regulations	could	result	in,	among	other	things,	termination,	fines	or	other	liabilities, and	changes	in	procurement	regulations	could	adversely	impact	our	business,	results	of	operations	or	cash	flows.

Revenues	from	our	public	sector	customers	are	derived	from	sales	to	governmental	entities,	educational	institutions	and	healthcare	customers,	through	various contracts	and	open	market	sales	of	products	and	services.	Sales	to	public	sector	customers	are	highly	regulated.	Noncompliance	with	contract	provisions,	government procurement	regulations	or	other	applicable	laws	or	regulations	(including	the	False	Claims	Act	and	the	Medicare	and	Medicaid	Anti-Kickback	Statute	or	similar	laws	of the	jurisdictions	for	our	business	activities	outside	of	the	US)	could	result	in	civil,	criminal	and	administrative	liability,	including	substantial	monetary	fines	or	damages, termination	of	government	contracts	or	other	public	sector	customer	contracts,	and	suspension,	debarment	or	ineligibility	from	doing	business	with	governmental	entities or	other	customers	in	the	public	sector.	In	addition,	contracts	in	the	public	sector	are	generally	terminable	at	any	time	for	convenience	of	the	contracting	agency	or	group purchasing	organization	("GPO")	or	upon	default.	Furthermore,	our	inability	to	enter	into	or	retain	contracts	with	GPOs	may	threaten	our	ability	to	sell	to	customers	in those	GPOs	and	compete	effectively.	The	effect	of	any	of	these	possible	actions	could	adversely	affect	our	business,	results	of	operations	or	cash	flows.	In	addition,	the adoption	of	new	or	modified	procurement	regulations	and	other	requirements	may	increase	our	compliance	costs	and	reduce	our	gross	margins,	which	could	have	a negative	effect	on	our	business,	results	of	operations	or	cash	flows.

# If	we	fail	to	provide	high-quality	services	to	our	customers,	or	if	our	third-party	service	providers	fail	to	provide	high-quality	services	to	our	customers,	our reputation,	business,	results	of	operations	or	cash	flows	could	be	adversely	affected.

Our	service	offerings	include	field	services,	managed	services,	warranties,	configuration	services,	partner	services	and	telecom	services.	Additionally,	we deliver	and	manage	mission	critical	software,	systems	and	network	solutions	for	our	customers.	We	also	offer	certain	services,	such	as	implementation	and	installation services	and	repair	services,	to	our	customers	through	various	third-party	service	providers	engaged	to	perform	these	services	on	our	behalf.	If	we	or	our	third-party service	providers	fail	to	provide	high-quality	services	to	our	customers	or	such	services	result	in	a	disruption	of	our	customers'	businesses,	this	could,	among	other things,	result	in	legal	claims	and	proceedings	and	liability	for	us.	Moreover,	as	we	expand	our	services	and	solutions	business,	we	may	be	exposed	to	additional operational,	regulatory	and	other	risks.	We	also	could	incur	liability	for	failure	to	comply	with	the	rules	and	regulations	applicable	to	the	new	services	and	solutions	we provide	to	our	customers.	If	any	of	the	foregoing	were	to	occur,	our	reputation	with	our	customers,	our	brand	and	our	business,	results	of	operations	or	cash	flows	could be	adversely	affected.

# If	we	lose	any	of	our	key	personnel,	or	are	unable	to	attract	and	retain	the	talent	required	for	our	business,	our	business	could	be	disrupted	and	our	financial performance	could	suffer.

Our	success	is	heavily	dependent	upon	our	ability	to	attract,	develop,	engage	and	retain	key	personnel	to	manage	and	grow	our	business,	including	our	key executive,	management,	sales,	services	and	technical	coworkers.

Our	future	success	will	depend	to	a	significant	extent	on	the	efforts	of	Thomas	E.	Richards,	our	Chairman	and	Chief	Executive	Officer,	as	well	as	the	continued service	and	support	of	our	other	executive	officers.	Our	future	success	also	will	depend	on	our	ability	to	retain	and	motivate	our	customer-facing	coworkers,	who	have been	given	critical	CDW	knowledge	regarding,	and	the	opportunity	to	develop	strong	relationships	with,	many	of	our	customers.	In	addition,	as	we	seek	to	expand	our offerings	of	value-added	services	and	solutions,	our	success	will	even	more	heavily	depend	on	attracting	and	retaining	highly	skilled	 technology	specialists	and engineers,	for	whom	the	market	is	extremely	competitive.

Our	inability	to	attract,	develop,	engage	and	retain	key	personnel	could	have	an	adverse	effect	on	our	relationships	with	our	vendor	partners	and	customers	and adversely	affect	our	ability	to	expand	our	offerings	of	value-added	services	and	solutions.	Moreover,	our	inability	to	train	our	sales,	services	and	technical	personnel effectively	to	meet	the	rapidly	changing	technology	needs	of	our	customers	could	cause	a	decrease	in	the	overall	quality	and	efficiency	of	such	personnel.	Such consequences	could	adversely	affect	our	business,	results	of	operations	or	cash	flows.

# The	interruption	of	the	flow	of	products	from	suppliers	could	disrupt	our	supply	chain.

While	we	purchase	our	products	primarily	in	the	markets	we	serve	(for	example,	products	for	US	customers	are	sourced	in	the	US),	our	vendor	partners manufacture	or	purchase	a	significant	portion	of	the	products	we	sell	outside	of	the	US,	primarily	in	Asia.	Political,	social	or	economic	instability	in	Asia,	or	in	other regions	in	which	our	vendor	partners	purchase	or	manufacture	the	products	we	sell,	could	cause	disruptions	in	trade,	including	exports	to	the	US.	Other	events	that	could also	cause	disruptions	to	our	supply	chain	include:

•the	 imposition of additional trade law provisions or regulations;

•the	 imposition	 of additional	 duties, tariffs and	 other charges	 on imports and exports;

•foreign currency fluctuations;

•natural	 disasters	 or	 other adverse	 occurrences at,	 or affecting, any	 of	 our suppliers' facilities;

•restrictions on the transfer of funds;

•the financial instability	 or	 bankruptcy	 of	 manufacturers; and

•significant	labor	disputes,	such	as	strikes.

We	cannot	predict	whether	the	countries	in	which	the	products	we	sell	are	purchased	or	manufactured,	or	may	be	purchased	or	manufactured	in	the	future,	will be	subject	to	new	or	additional	trade	restrictions	or	sanctions	imposed	by	the	US	or	foreign	governments,	including	the	likelihood,	type	or	effect	of	any	such	restrictions. Trade	restrictions,	including	new	or	increased	tariffs	or	quotas,	embargoes,	sanctions,	safeguards	and	customs	restrictions	against	the	products	we	sell,	as	well	as	foreign labor	strikes	and	work	stoppages	or	boycotts,	could	increase	the	cost	or	reduce	the	supply	of	product	available	to	us	and	adversely	affect	our	business,	results	of operations	or	cash	flows.	In	addition,	our	exports	are	subject	to	regulations,	some	of	which	may	be	inconsistent,	and	noncompliance	with	these	requirements	could	have a	negative	effect	on	our	business,	results	of	operations	or	cash	flows.

# A	natural	disaster	or	other	adverse	occurrence	at	one	of	our	primary	facilities	or	customer	data	centers	could	damage	our	business.

We	have	two	warehouse	and	distribution	facilities	in	the	US	and	one	in	the	UK.	If	the	warehouse	and	distribution	equipment	at	one	of	our	distribution	centers were	to	be	seriously	damaged	by	a	natural	disaster	or	other	adverse	occurrence,	we	could	utilize	another	distribution	center	or	third-party	distributors	to	ship	products	to our	customers.	However,	this	may	not	be	sufficient	to	avoid	interruptions	in	our	service	and	may	not	enable	us	to	meet	all	of	the	needs	of	our	customers	and	would	cause us	to	incur	incremental	operating	costs.	In	addition,	we	operate	three	customer	data	centers	and	numerous	sales	offices	which	may	contain	both	business-critical	data	and confidential	information	of	our	customers.	A	natural	disaster	or	other	adverse	occurrence	at	any	of	the	customer	data	centers	or	at	any	of	our	major	sales	offices	could negatively	impact	our	business,	results	of	operations	or	cash	flows.

# Increases	in	the	cost	of	commercial	delivery	services	or	disruptions	of	those	services	could	adversely	impact	our	business.

We	generally	ship	hardware	products	to	our	customers	by	FedEx,	United	Parcel	Service	and	other	commercial	delivery	services	and	invoice	customers	for delivery	charges.	If	we	are	unable	to	pass	on	to	our	customers	future	increases	in	the	cost	of	commercial	delivery	services,	our	profitability	could	be	adversely	affected. Additionally,	strikes,	inclement	weather,	natural	disasters	or	other	service	interruptions	by	such	shippers	could	adversely	affect	our	ability	to	deliver	products	on	a	timely basis.

# We	are	exposed	to	accounts	receivable	and	inventory	risks.

We	extend	credit	to	our	customers	for	a	significant	portion	of	our	Net	sales,	typically	on	30-day	payment	terms.	We	are	subject	to	the	risk	that	our	customers may	not	pay	for	the	products	they	have	purchased,	or	may	pay	at	a	slower	rate	than	we	have	historically	experienced,	the	risk	of	which	is	heightened	during	periods	of economic	downturn	or	uncertainty	or,	in	the	case	of	public	sector	customers,	during	periods	of	budget	constraints.

We	are	also	exposed	to	inventory	risks	as	a	result	of	the	rapid	technological	changes	that	affect	the	market	and	pricing	for	the	products	we	sell.	We	seek	to minimize	our	inventory	exposure	through	a	variety	of	inventory	management	procedures	and	policies,	including	our	rapid-turn	inventory	model,	as	well	as	vendor	price protection	and	product	return	programs.	However,	if	we	were	unable	to	maintain	our	rapid-turn	inventory	model,	if	there	were	unforeseen	product	developments	that created	more	rapid	obsolescence	or	if	our	vendor	partners	were	to	change	their	terms	and	conditions,	our	inventory	risks	could	increase.	We	also	from	time	to	time	take advantage	of	cost	savings	associated	with	certain	opportunistic	bulk	inventory	purchases	offered	by

our	vendor	partners	or	we	may	decide	to	carry	high	inventory	levels	of	certain	products	that	have	limited	or	no	return	privileges	due	to	customer	demand	or	request. These	bulk	purchases	could	increase	our	exposure	to	inventory	obsolescence.

# We	could	be	exposed	to	additional	risks	if	we	continue	to	make	strategic	investments	or	acquisitions	or	enter	into	alliances.

We	may	continue	to	pursue	transactions,	including	strategic	investments,	acquisitions	or	alliances,	in	an	effort	to	extend	or	complement	our	existing	business. These	types	of	transactions	involve	numerous	business	risks,	including	finding	suitable	transaction	partners	and	negotiating	terms	that	are	acceptable	to	us,	the	diversion of	management's	attention	from	other	business	concerns,	extending	our	product	or	service	offerings	into	areas	in	which	we	have	limited	experience,	entering	into	new geographic	markets,	the	potential	loss	of	key	coworkers	or	business	relationships	and	successfully	integrating	acquired	businesses.	There	can	be	no	assurance	that	the intended	benefits	of	our	investments,	acquisitions	and	alliances	will	be	realized,	or	that	those	benefits	will	offset	these	numerous	risks	or	other	unforeseen	factors,	any	of which	could	adversely	affect	our	business,	results	of	operations	or	cash	flows.

In	addition,	our	financial	results	could	be	adversely	affected	by	financial	adjustments	required	by	generally	accepted	accounting	principles	in	the	United	States of	America	("GAAP")	in	connection	with	these	types	of	transactions	where	significant	goodwill	or	intangible	assets	are	recorded.	To	the	extent	the	value	of	goodwill	or identifiable	intangible	assets	with	indefinite	lives	becomes	impaired,	we	may	be	required	to	incur	material	charges	relating	to	the	impairment	of	those	assets.

# Our	future	operating	results	may	fluctuate	significantly,	which	may	result	in	volatility	in	the	market	price	of	our	stock	and	could	impact	our	ability	to	operate	our business	effectively.

We	may	experience	significant	variations	in	our	future	quarterly	results	of	operations.	These	fluctuations	may	cause	the	market	price	of	our	common	stock	to be	volatile	and	may	result	from	many	factors,	including	the	condition	of	the	technology	industry	in	general,	shifts	in	demand	and	pricing	for	hardware,	software	and services	and	the	introduction	of	new	products	or	upgrades.

Our	operating	results	are	also	highly	dependent	on	our	level	of	Gross	profit	as	a	percentage	of	Net	sales.	Our	Gross	profit	percentage	fluctuates	due	to numerous	factors,	some	of	which	may	be	outside	of	our	control,	including	general	macroeconomic	conditions;	pricing	pressures;	changes	in	product	costs	from	our vendor	partners;	the	availability	of	price	protection,	purchase	discounts	and	incentive	programs	from	our	vendor	partners;	changes	in	product,	order	size	and	customer mix;	the	risk	of	some	items	in	our	inventory	becoming	obsolete;	increases	in	delivery	costs	that	we	cannot	pass	on	to	customers;	and	general	market	and	competitive conditions.

In	addition,	our	cost	structure	is	based,	in	part,	on	anticipated	sales	and	gross	margins.	Therefore,	we	may	not	be	able	to	adjust	our	cost	structure	quickly enough	to	compensate	for	any	unexpected	sales	or	gross	margin	shortfall,	and	any	such	inability	could	have	an	adverse	effect	on	our	business,	results	of	operations	or cash	flows.

# Fluctuations	in	foreign	currency	have	an	effect	on	our	reported	results	of	operations.

Our	exposure	to	fluctuations	in	foreign	currency	rates	results	primarily	from	the	translation	exposure	associated	with	the	preparation	of	our	Consolidated Financial	Statements.	While	our	Consolidated	Financial	Statements	are	reported	in	US	dollars,	the	financial	statements	of	our	subsidiaries	outside	the	US	are	prepared using	the	local	currency	as	the	functional	currency	and	translated	into	US	dollars.	As	a	result,	fluctuations	in	the	exchange	rate	of	the	US	dollar	relative	to	the	local currencies	of	our	international	subsidiaries,	particularly	the	British	pound	and	the	Canadian	dollar,	could	cause	fluctuations	in	our	reported	results	of	operations.	We	also have	foreign	currency	exposure	to	the	extent	sales	and	purchases	are	not	denominated	in	a	subsidiary's	functional	currency,	which	could	have	an	adverse	effect	on	our business,	results	of	operations	or	cash	flows.

# We	are	exposed	to	risks	from	legal	proceedings	and	audits,	which	may	result	in	substantial	costs	and	expenses	or	interruption	of	our	normal	business	operations.

We	are	party	to	various	legal	proceedings	that	arise	in	the	ordinary	course	of	our	business,	which	include	commercial,	employment,	tort	and	other	litigation.

We	are	subject	to	intellectual	property	infringement	claims	against	us	in	the	ordinary	course	of	our	business,	either	because	of	the	products	and	services	we	sell or	 the	 business	 systems	 and	 processes	 we	 use	 to	 sell	 such	 products	 and	 services,	 in	 the	 form	 of	 cease-and-desist	 letters,	 licensing	 inquiries,	 lawsuits	 and	 other communications	and	demands.	In	our	industry,	such	intellectual	property	claims	have	become	more	frequent	as	the	complexity	of	technological	products	and	the intensity	of	competition	in	our	industry	have	increased.	Increasingly,	many	of	these	assertions	are	brought	by	non-practicing	entities	whose	principal	business	model	is to	secure	patent	licensing	revenue,	but	we	may	also	be	subject	to	demands	from	inventors,	competitors	or	other	patent	holders	who	may	seek	licensing	revenue,	lost profits	and/or	an	injunction	preventing	us	from	engaging	in	certain	activities,	including	selling	certain	products	or	services.

We	also	are	subject	to	proceedings,	investigations	and	audits	by	federal,	state,	international,	national,	provincial	and	local	authorities,	including	because	of	our significant	sales	to	governmental	entities.	We	also	are	subject	to	audits	by	various	vendor	partners	and	large	customers,	including	government	agencies,	relating	to purchases	and	sales	under	various	contracts.	In	addition,	we	are	subject	to	indemnification	claims	under	various	contracts.

Current	and	future	litigation,	infringement	claims,	governmental	proceedings	and	investigations,	audits	or	indemnification	claims	that	we	face	may	result	in substantial	costs	and	expenses	and	significantly	divert	the	attention	of	our	management	regardless	of	the	outcome.	In	addition,	these	matters	could	lead	to	increased	costs or	interruptions	of	our	normal	business	operations.	Litigation,	infringement	claims,	governmental	proceedings	and	investigations,	audits	or	indemnification	claims involve	uncertainties	and	the	eventual	outcome	of	any	such	matter	could	adversely	affect	our	business,	results	of	operations	or	cash	flows.

# Failure	to	comply	with	complex	and	evolving	US	and	foreign	laws	and	regulations	applicable	to	our	operations	could	adversely	impact	our	business,	results	of operations	or	cash	flows.

Our	operations	are	subject to	numerous	complex	US	and	foreign laws	and	regulations in	a	number	of	areas including	areas	of labor	and	employment, advertising,	e-commerce,	tax,	import	and	export	requirements,	anti-corruption,	data	privacy	requirements	(including	those	under	the	European	Union	General	Data Protection	Regulation),	anti-competition,	and	environmental,	health,	and	safety.	The	evaluation	of,	and	compliance	with	these	laws,	regulations	and	similar	requirements may	be	onerous	and	expensive,	and	these	laws	and	regulations	may	have	other	adverse	impacts	on	our	business,	results	of	operations	or	cash	flows.	For	example,	the	Tax Cuts	and	Jobs	Act	of	2017	was	signed	into	law	in	the	fourth	quarter	of	2017,	making	significant	changes	to	the	US	Internal	Revenue	Code.	While	we	have	estimated	the income	tax	effects	of	the	Act	in	our	Consolidated	Financial	Statements,	we	continue	to	analyze	the	income	tax	effects	of	the	Act,	as	well	as	to	monitor	tax	and accounting	guidance	issued	by	various	authorities,	which	could	result	in	material	changes	as	we	refine	those	estimates.	Furthermore,	the	laws	and	regulations	to	which the	Company	is	subject	are	evolving	and	may	be	inconsistent	from	jurisdiction	to	jurisdiction,	further	increasing	the	cost	of	compliance	and	doing	business,	and	the	risk of	noncompliance.

We	have	implemented	policies	and	procedures	designed	to	help	ensure	compliance	with	applicable	laws	and	regulations,	but	there	can	be	no	guarantee	against coworkers,	contractors	or	agents	violating	such	laws	and	regulations	or	our	policies	and	procedures.

As	 a	 public	 company,	 we	 also	 are	 subject	 to increasingly	 complex	 public	 disclosure,	 corporate	 governance	 and	 accounting requirements that increase compliance	costs	and	require	significant	management	focus.

# Risks	Related	to	Our	Indebtedness

# We	have	a	substantial	amount	of	indebtedness,	which	could	have	important	consequences	to	our	business.

We	have	a	substantial	amount	of	indebtedness.	As	of	December	31,	2017,	we	had	$3.2	billion	of	total	long-term	debt	outstanding,	as	defined	by	GAAP,	and $498	million	of	obligations	outstanding	under	our	inventory	financing	agreements,	and	the	ability	to	borrow	an	additional	$996	million	under	our	senior	secured	asset- based	revolving	credit	loan	facility	(the	"Revolving	Loan")	and	an	additional	£50	million	($68	million	 at	December	31,	2017)	under	our	CDW	UK	revolving	credit facility.	Our	substantial	indebtedness	could	have	important	consequences,	including	the	following:

•making	 it	 more difficult for us to satisfy our obligations	 with respect to our indebtedness;

•requiring	us	to	dedicate	a	substantial	portion	of	our	cash	flow	from	operations	to	debt	service	payments	on	our	and	our	subsidiaries'	debt,	which	reduces	the funds	available	for	working	capital,	capital	expenditures,	acquisitions	and	other	general	corporate	purposes;

•requiring	us	to	comply	with	restrictive	covenants	in	our	senior	credit	facilities	and	indentures,	which	limit	the	manner	in	which	we	conduct	our business;

•making	 it	 more	 difficult for	 us to	 obtain	 vendor financing from	 our	 vendor	 partners, including	 original	 equipment	 manufacturers	 and	 software publishers;

•limiting	 our	 flexibility in	 planning	 for,	 or	 reacting to,	 changes in the industry in	 which	 we operate;

•placing	 us at a competitive disadvantage compared to any of our less-leveraged competitors;

•increasing	our	vulnerability	to	both	general	and	industry-specific	adverse	economic	conditions;

•limiting	our	ability	to	obtain	additional	debt	or	equity	financing	to	fund	future	working	capital,	capital	expenditures,	acquisitions	or	other	general	corporate requirements	and	increasing	our	cost	of	borrowing.

# Restrictive	covenants	under	our	senior	credit	facilities	and,	to	a	lesser	degree,	our	indentures	may	adversely	affect	our	operations	and	liquidity.

Our	senior	credit	facilities	and,	to	a	lesser	degree,	our	indentures	contain,	and	any	future	indebtedness	of	ours	may	contain,	various	covenants	that	limit	our ability	to,	among	other	things:

•incur	or	guarantee	additional	debt;

•pay	 dividends	 or	 make	 distributions to	 holders	 of	 our	 capital stock	 or to	 make	 certain	 other restricted	 payments	 or investments;

•repurchase	or	redeem	capital	stock;

•make loans, capital expenditures or investments or acquisitions;

•receive dividends or other payments from our subsidiaries;

# •enter	into	transactions	with	affiliates;

# •create	liens;

•merge	 or	 consolidate	 with	 other	 companies	 or transfer	 all	 or	 substantially	 all	 of	 our assets;

•transfer	 or	 sell	 assets, including	 capital	 stock	 of	 subsidiaries; and

•prepay, repurchase or redeem debt.

As	a	result	of	these	covenants,	we	are	limited	in	the	manner	in	which	we	conduct	our	business	and	we	may	be	unable	to	engage	in	favorable	business	activities or	finance	future	operations	or	capital	needs.	A	breach	of	any	of	these	covenants	or	any	of	the	other	restrictive	covenants	would	result	in	a	default	under	our	senior	credit facilities.	Upon	the	occurrence	of	an	event	of	default	under	our	senior	credit	facilities,	the	lenders:

•will	not	be	required	to	lend	any	additional	amounts	to

•could	elect	to	declare	all	borrowings	outstanding	thereunder,	together	with	accrued	and	unpaid	interest	and	fees,	to	be	due	and	payable;

•could	 require us to apply all of our available cash to repay these borrowings.

The	acceleration	of	amounts	outstanding	under	our	senior	credit	facilities	would	likely	trigger	an	event	of	default	under	our	existing	indentures.

If	we	were	unable	to	repay	those	amounts,	the	lenders	under	our	senior	credit	facilities	could	proceed	against	the	collateral	granted	to	them	to	secure	our borrowings	thereunder.	We	have	pledged	a	significant	portion	of	our	assets	as	collateral	under	our	senior	credit	facilities.	If	the	lenders	under	our	senior	credit	facilities accelerate	the	repayment	of	borrowings,	we	cannot	assure	you	that	we	will	have	sufficient	assets	to	repay	our	senior	credit	facilities	and	our	other	indebtedness	or	the ability	to	borrow	sufficient	funds	to	refinance	such	indebtedness.	Even	if	we	were	able	to	obtain	new	financing,	it	may	not	be	on	commercially	reasonable	terms,	or terms	that	are	acceptable	to	us.

In	addition,	under	our	Revolving	Loan,	we	are	permitted	to	borrow	an	aggregate	amount	of	up	to	$1.5	billion.	However,	our	ability	to	borrow	under	our Revolving	Loan	is	limited	by	a	borrowing	base	and	a	liquidity	condition.	The	borrowing	base	at	any	time	equals	the	sum	of	up	to	85%	of	CDW	LLC	and	its	subsidiary guarantors'	eligible	accounts	receivable	(net	of	accounts	reserves)	(up	to	30%	of	such	eligible	accounts	receivable	which	can	consist	of	federal	government	accounts receivable)	plus	the	lesser	of	(i)	75%	of	CDW	LLC	and	its	subsidiary	guarantors'	eligible	inventory	(valued	at	cost	and	net	of	inventory	reserves)	and	(ii)	the	product	of 85%	multiplied	by	the	net	orderly	liquidation	value	percentage	multiplied	by	eligible	inventory	(valued	at	cost	and	net	of	inventory	reserves),	less	reserves	(other	than accounts	reserves	and	inventory	reserves).	The	borrowing	base	in	effect	as	of	December	31,	2017	was	$1.6	billion	and,	therefore,	did	not	restrict	our	ability	to	borrow under	our	Revolving	Loan	as	of	that	date.

Our	ability	to	borrow	under	our	Revolving	Loan	is	also	limited	by	a	minimum	liquidity	condition,	which	provides	that,	if	excess	cash	availability	is	less	than the	lesser	of	(i)	$125	million	and	(ii)	the	greater	of	(A)	10%	of	the	borrowing	base	and	(B)

$100	million,	the	lenders	are	not	required	to	lend	any	additional	amounts	under	our	Revolving	Loan	unless	the	consolidated	fixed	charge	coverage	ratio	(as	defined	in the	credit	agreement	for	our	Revolving	Loan)	is	at	least	1.00	to	1.00.	It	is	an	event	of	default	under	our	Revolving	Loan	if	our	excess	cash	availability	and	consolidated fixed	charge	coverage	ratio	remain	below	such	levels	for	a	period	of	five	or	more	consecutive	business	days.	Moreover,	our	Revolving	Loan	provides	discretion	to	the agent	bank	acting	on	behalf	of	the	lenders	to	impose	additional	availability	reserves,	which	could	materially	impair	the	amount	of	borrowings	that	would	otherwise	be available	to	us.	We	cannot	assure	you	that	the	agent	bank	will	not	impose	such	reserves	or,	were	it	to	do	so,	that	the	resulting	impact	of	this	action	would	not	materially and	adversely	impair	our	liquidity.

# We	will	be	required	to	generate	sufficient	cash	to	service	our	indebtedness	and,	if	not	successful,	we	may	be	forced	to	take	other	actions	to	satisfy	our	obligations under	our	indebtedness.

Our	ability	to	make	scheduled	payments	on	or	to	refinance	our	debt	obligations	depends	on	our	financial	and	operating	performance,	which	is	subject	to prevailing	economic	and	competitive	conditions	and	to	certain	financial,	business	and	other	factors	beyond	our	control.	Our	outstanding	long-term	debt	will	impose significant	cash	interest	payment	obligations	on	us	and,	accordingly,	we	will	have	to	generate	significant	cash	flow	from	operating	activities	to	fund	our	debt	service obligations.	We	cannot	assure	you	that	we	will	maintain	a	level	of	cash	flows	from	operating	activities	sufficient	to	permit	us	to	pay	the	principal,	premium,	if	any,	and interest	on	our	indebtedness.	See	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations-Liquidity	and	Capital	Resources"	included elsewhere	in	this	report.

If	our	cash	flows	and	capital	resources	are	insufficient	to	fund	our	debt	service	obligations,	we	may	be	forced	to	reduce	or	delay	capital	expenditures,	sell	assets or	operations,	seek	additional	debt	or	equity	capital,	restructure	or	refinance	our	indebtedness,	or	revise	or	delay	our	strategic	plan.	We	cannot	assure	you	that	we	would be	able	 to	 take	any	of	 these	actions,	 that	 these	actions	would	be	successful	and	permit	us	 to	meet	our	scheduled	debt	service	obligations	or	satisfy	our	capital requirements,	or	that	these	actions	would	be	permitted	under	the	terms	of	our	existing	or	future	debt	agreements,	including	our	senior	credit	facilities	and	indentures.	In the	absence	of	such	operating	results	and	resources,	we	could	face	substantial	liquidity	problems	and	might	be	required	to	dispose	of	material	assets	or	operations	to meet	our	debt	service	and	other	obligations.	Our	senior	credit	facilities	restrict	our	ability	to	dispose	of	assets	and	use	the	proceeds	from	the	disposition.	We	may	not	be able	to	consummate	those	dispositions	or	to	obtain	the	proceeds	which	we	could	realize	from	them	and	these	proceeds	may	not	be	adequate	to	meet	any	debt	service obligations	then	due.

If	we	cannot	make	scheduled	payments	on	our	debt,	we	will	be	in	default	and,	as	a	result:

•our	 debt	 holders	 could	 declare	 all	 outstanding	 principal	 and interest to	 be	 due	 and payable;

•the	lenders	under	our	senior	credit	facilities	could	foreclose	against	the	assets	securing	the	borrowings	from	them	and	the	lenders	under	our	Revolving	Loan and	CDW	UK	revolving	credit	facility	could	terminate	their	commitments	to	lend	us	money;	and

•we	 could be forced into bankruptcy or liquidation.

# Despite	our	indebtedness	levels,	we	and	our	subsidiaries	may	be	able	to	incur	substantially	more	debt,	including	secured	debt.	This	could	further	increase	the	risks associated	with	our	leverage.

We	and	our	subsidiaries	may	be	able	to	incur	substantial	additional	indebtedness	in	the	future.	The	terms	of	our	senior	credit	facilities	and	indentures	do	not fully	prohibit	us	or	our	subsidiaries	from	doing	so.	To	the	extent	that	we	incur	additional	indebtedness,	the	risks	associated	with	our	substantial	indebtedness	described above,	including	our	possible	inability	to	service	our	debt,	will	increase.	As	of	December	31,	2017,	we	had	$996	million	available	for	additional	borrowing	under	our Revolving	Loan	after	taking	into	account	borrowing	base	limitations	(net	of	$1	million	of	issued	and	undrawn	letters	of	credit	and	$454	million	of	reserves	related	to	our floorplan	sub-facility)	and	an	additional	£50	million	($68	million	at	December	31,	2017)	available	under	our	CDW	UK	revolving	credit	facility.

# Variable	rate	indebtedness	subjects	us	to	interest	rate	risk,	which	could	cause	our	debt	service	obligations	to	increase	significantly.

Certain	of	our	borrowings,	primarily	borrowings	under	our	senior	credit	facilities,	are	at	variable	rates	of	interest	and	expose	us	to	interest	rate	risk.	As	of December	31,	2017,	we	had	$1.5	billion	of	variable	rate	debt	outstanding.	If	interest	rates	increase,	our	debt	service	obligations	on	the	variable	rate	indebtedness	would increase	even	though	the	amount	borrowed	remained	the	same,	and	our	net	income	would	decrease.	Although	we	have	entered	into	interest	rate	cap	agreements	on	our term	loan	facility	to	reduce	interest	rate	volatility,	we	cannot	assure	you	we	will	be	able	to	enter	into	interest	rate	cap	agreements	in	the	future	on	acceptable	terms	or	that such	caps	or	the	caps	we	have	in	place	now	will	be	effective.

# Risks	Related	to	Ownership	of	Our	Common	Stock

# Our	common	stock	price	may	be	volatile	and	may	decline	regardless	of	our	operating	performance,	and	holders	of	our	common	stock	could	lose	a	significant portion	of	their	investment.

The	market	price	for	our	common	stock	may	be	volatile.	Our	stockholders	may	not	be	able	to	resell	their	shares	of	common	stock	at	or	above	the	price	at	which they	purchased	such	shares,	due	to	fluctuations	in	the	market	price	of	our	common	stock,	which	may	be	caused	by	a	number	of	factors,	many	of	which	we	cannot control,	including	the	risk	factors	described	in	this	Annual	Report	on	Form	10-K	and	the	following:

•changes	in	financial	estimates	by	any	securities	analysts	who	follow	our	common	stock,	our	failure	to	meet	these	estimates	or	failure	of	securities	analysts	to maintain	coverage	of	our	common	stock;

•downgrades	 by any securities analysts	 who follow	 our common stock;

•future	 sales of our common stock by our officers, directors and significant stockholders;

•market	 conditions	 or trends in	 our industry	 or the	 economy	 as	 a whole;

•investors' perceptions of our prospects;

•announcements	by	us	or	our	competitors	of	significant	contracts,	acquisitions,	joint	ventures	or	capital	commitments; and

# •changes	in	key	personnel.

In	addition,	the	stock	markets	have	experienced	extreme	price	and	volume	fluctuations	that	have	affected	and	continue	to	affect	the	market	prices	of	equity securities	of	many	companies,	including	companies	in	our	industry.	In	the	past,	securities	class	action	litigation	has	followed	periods	of	market	volatility.	If	we	were involved	in	securities	litigation,	we	could	incur	substantial	costs,	and	our	resources	and	the	attention	of	management	could	be	diverted	from	our	business.

In	the	future,	we	may	also	issue	our	securities	in	connection	with	investments	or	acquisitions.	The	number	of	shares	of	our	common	stock	issued	in	connection with	an	investment	or	acquisition	could	constitute	a	material	portion	of	our	then-outstanding	shares	of	our	common	stock	and	depress	our	stock	price.

# Anti-takeover	provisions	in	our	charter	documents	and	Delaware	law	might	discourage	or	delay	acquisition	attempts	for	us	that	you	might	consider	favorable.

Our	amended	and	restated	certificate	of	incorporation	and	amended	and	restated	bylaws	contain	provisions	that	may	make	the	acquisition	of	the	Company	more difficult	without	the	approval	of	our	Board	of	Directors.	These	provisions:

•authorize	the	issuance	of	undesignated	preferred	stock,	the	terms	of	which	may	be	established	and	the	shares	of	which	may	be	issued	without	stockholder approval,	and	which	may	include	super	voting,	special	approval,	dividend,	or	other	rights	or	preferences	superior	to	the	rights	of	the	holders	of	common	stock;

•establish	a	classified	Board	of	Directors	so	that	not	all	members	of	our	Board	of	Directors	are	elected	at	one time;

•generally	 prohibit stockholder action	 by	 written consent, requiring all stockholder actions	 be taken at a	 meeting	 of	 our stockholders;

•provide	that	special	meetings	of	the	stockholders	can	only	be	called	by	or	at	the	direction	of	our	Board	of	Directors	pursuant	to	a	written	resolution	adopted	by the	affirmative	vote	of	the	majority	of	the	total	number	of	directors	that	the	Company	would	have	if	there	were	no	vacancies;

•establish	advance	notice	requirements	for	nominations	for	elections	to	our	Board	of	Directors	or	for	proposing	matters	that	can	be	acted	upon	by	stockholders	at stockholder	meetings;	and

•provide	that	our	Board	of	Directors	is	expressly	authorized	to	make,	alter	or	repeal	our	amended	and	restated

bylaws.

Our	amended	and	restated	certificate	of	incorporation	also	contains	a	provision	that	provides	us	with	protections	similar	to	Section	203	of	the	Delaware	General Corporation	Law,	and	will	prevent	us	from	engaging	in	a	business	combination	with	a	person	who	acquires	at	least	15%	of	our	common	stock	for	a	period	of	three	years from	the	date	such	person	acquired	such	common	stock,	unless	board	or	stockholder	approval	is	obtained	prior	to	the	acquisition.	These	anti-takeover	provisions	and other	provisions	under	Delaware	law	could	discourage,	delay	or	prevent	a	transaction	involving	a	change	in	control	of	the	Company,	even	if	doing

so	would	benefit	our	stockholders.	These	provisions	could	also	discourage	proxy	contests	and	make	it	more	difficult	for	our	stockholders	to	elect	directors	of	their choosing	and	to	cause	us	to	take	other	corporate	actions	our	stockholders	desire.

We	cannot	assure	you	that	we	will	continue	to	pay	dividends	on	our	common	stock	or	repurchase	any	of	our	common	stock	under	our	share	repurchase	program, and	our	indebtedness	and	certain	tax	considerations	could	limit	our	ability	to	continue	to	pay	dividends	on,	or	make	share	repurchases	of,	our	common	stock.	If	we do	not	continue	to	pay	dividends,	you	may	not	receive	any	return	on	investment	unless	you	are	able	to	sell	your	common	stock	for	a	price	greater	than	your purchase	price.

We	expect	to	continue	to	pay	a	cash	dividend	on	our	common	stock,	currently	at	the	rate	of	$0.21	 per	 share	 per	 quarter,	 or	$0.84	per	share	per	annum. However,	any	determination	to	pay	dividends	in	the	future	will	be	at	the	discretion	of	our	Board	of	Directors.	Any	determination	to	pay	dividends	on,	or	repurchase, shares	 of	 our	 common	 stock	 in	 the	 future	 will	 depend	 upon	 our	 results	 of	 operations,	 financial	 condition,	 business	 prospects,	 capital	 requirements,	 contractual restrictions,	any	potential	indebtedness	we	may	incur,	restrictions	imposed	by	applicable	law,	tax	considerations	and	other	factors	our	Board	of	Directors	deems	relevant. In	addition,	our	ability	 to	pay	dividends	on,	or	repurchase,	shares	of	our	common	stock	will	be	 limited	by	restrictions	on	our	ability	 to	pay	dividends	or	make distributions	to	our	stockholders	and	on	the	ability	of	our	subsidiaries	to	pay	dividends	or	make	distributions	to	us,	in	each	case,	under	the	terms	of	our	current	and	any future	agreements	governing	our	indebtedness.	There	can	be	no	assurance	that	we	will	continue	to	pay	a	dividend	at	the	current	rate	or	at	all	or	that	we	will	repurchase shares	of	our	common	stock.	If	we	do	not	pay	dividends	in	the	future,	realization	of	a	gain	on	your	investment	will	depend	entirely	on	the	appreciation	of	the	price	of	our common	stock,	which	may	never	occur.

# We	are	a	holding	company	and	rely	on	dividends,	distributions	and	other	payments,	advances	and	transfers	of	funds	from	our	subsidiaries	to	meet	our	obligations.

We	are	a	holding	company	 that	does	not	conduct	any	business	operations	of	our	own.	As	a	result,	we	are	 largely	dependent	upon	cash	dividends	and distributions	and	other	transfers	from	our	subsidiaries	to	meet	our	obligations.	The	agreements	governing	the	indebtedness	of	our	subsidiaries	impose	restrictions	on	our subsidiaries'	ability	to	pay	dividends	or	other	distributions	to	us.	The	deterioration	of	the	earnings	from,	or	other	available	assets	of,	our	subsidiaries	for	any	reason	could also	limit	or	impair	their	ability	to	pay	dividends	or	other	distributions	to	us.

# Item	1B.	Unresolved	Staff	Comments

# None.

# Item	2.	Properties

As	of	December	31,	2017,	we	owned	or	leased	a	total	of	2.3	million	square	feet	of	space,	primarily	in	the	US,	Canada	and	UK.	We	own	two	properties:	a 513,000	square	foot	distribution	center	in	North	Las	Vegas,	Nevada,	and	a	combined	office	and	a	442,000	square	foot	distribution	center	in	Vernon	Hills,	Illinois.	In addition,	we	conduct	sales,	services	and	administrative	activities	in	various	leased	locations	primarily	in	the	US,	Canada	and	UK,	including	data	centers	in	Madison, Wisconsin,	Minneapolis,	Minnesota	and	the	UK.

We	believe	our	facilities	are	well	maintained,	suitable	for	our	business	and	occupy	sufficient	space	to	meet	our	operating	needs.	As	part	of	our	normal	business, we	regularly	evaluate	sales	center	performance	and	site	suitability.	Leases	covering	our	currently	occupied	leased	properties	expire	at	varying	dates,	generally	within	the next	ten	years.	We	anticipate	no	difficulty	in	retaining	occupancy	through	lease	renewals,	month-to-month	occupancy	or	replacing	the	leased	properties	with	equivalent properties.	We	believe	that	suitable	additional	or	substitute	leased	properties	will	be	available	as	required.

# Item	3.	Legal	Proceedings

We	are	party	to	various	legal	proceedings	that	arise	in	the	ordinary	course	of	our	business,	which	include	commercial,	intellectual	property,	employment,	tort and	other	litigation	matters.	We	are	also	subject	to	audit	by	federal,	state,	international,	national,	provincial	and	local	authorities,	and	by	various	partners,	group purchasing	 organizations	 and	 customers,	 including	 government	 agencies,	 relating	 to	 purchases	 and	 sales	 under	 various	 contracts.	 In	 addition,	 we	 are	 subject	 to indemnification	claims	under	various	contracts.	From	time	to	time,	certain	of	our	customers	file	voluntary	petitions	for	reorganization	or	liquidation	under	the	US bankruptcy	laws	or	similar	laws	of	the	jurisdictions	for	our	business	activities	outside	of	the	US.	In	such	cases,	certain	pre-petition	payments	received	by	us	could	be considered	preference	items	and	subject	to	return	to	the	bankruptcy	administrator.

As	of	December	31,	2017,	we	do	not	believe	that	there	is	a	reasonable	possibility	that	any	material	loss	exceeding	the	amounts	already	recognized	for	these proceedings	and	matters,	if	any,	has	been	incurred.	However,	the	ultimate	resolutions	of	these	proceedings	and	matters	are	inherently	unpredictable.	As	such,	our financial	condition	and	results	of	operations	could	be	adversely	affected	in	any	particular	period	by	the	unfavorable	resolution	of	one	or	more	of	these	proceedings	or matters.

On	October	29,	2015,	the	Company	learned	of	an	investigation	by	the	SEC	of	the	Company's	vendor	partner	program	incentives.	On	May	19,	2017,	the	SEC Staff	informed	the	Company	that	the	SEC	has	concluded	its	investigation	and	does	not	intend	to	recommend	an	enforcement	action.	The	investigation	did	not	have	any impact	on	the	Company's	financial	condition	or	results	of	operations	other	than	customary	costs	related	to	the	Company's	cooperation	with	the	investigation.

# Item	4.	Mine	Safety	Disclosures

# Executive	Officers

Thomas	E.	Richards	serves	as	our	Chairman,	President	and	Chief	Executive	Officer	and	as	a	member	of	our	board	of	directors.	Mr.	Richards	has	served	as	our President	and	Chief	Executive	Officer	since	October	2011	and	was	named	Chairman	in	January	2013.	From	2009	to	2011,	Mr.	Richards	served	as	our	President	and Chief	Operating	Officer.	Prior	to	joining	CDW,	Mr.	Richards	held	leadership	positions	with	Qwest	Communications	International	Inc.	("Qwest"),	a	broadband	Internet- based	communications	company.	From	2008	to	2009,	he	served	as	Executive	Vice	President	and	Chief	Operating	Officer,	where	he	was	responsible	for	the	day-to-day operation	and	performance	of	Qwest,	and	before	assuming	that	role,	was	the	Executive	Vice	President	of	the	Business	Markets	Group	from	2005	to	2008.	Mr.	Richards also	has	served	as	Chairman	and	Chief	Executive	Officer	of	Clear	Communications	Corporation	and	as	Executive	Vice	President	of	Ameritech	Corporation.	Mr. Richards	serves	as	a	board	member	of	The	Northern	Trust	Corporation,	Junior	Achievement	of	Chicago,	Rush	University	Medical	Center	and	 the	University	of Pittsburgh.	Mr.	Richards	also	is	a	member	of	the	Economic	Club	of	Chicago	and	the	Executives'	Club	of	Chicago.	Mr.	Richards	is	a	graduate	of	the	University	of Pittsburgh	where	he	earned	a	bachelor's	degree	and	a	graduate	of	Massachusetts	Institute	of	Technology	where	he	earned	a	Master	of	Science	in	Management	as	a	Sloan Fellow.

Dennis	G.	Berger	serves	as	our	Senior	Vice	President	and	Chief	Coworker	Services	Officer	and	is	responsible	for	leading	CDW's	programs	in	coworker learning	and	development,	benefits,	compensation,	performance	management,	coworker	relations	and	talent	acquisition.	Mr.	Berger	joined	CDW	in	2005	as	Vice President-Coworker	Services.	In	2007,	he	was	named	Senior	Vice	President	and	Chief	Coworker	Services	Officer.	Prior	to	joining	CDW,	he	served	as	Vice	President	of Human	Resources	at	PepsiAmericas,	a	beverage	company,	from	2002	to	2005.	Mr.	Berger	has	also	held	human	resources	positions	of	increasing	responsibility	at	Pepsi Bottling	Group,	Inc.,	PepsiCo,	Inc.	and	GTE	Corporation.	Mr.	Berger	serves	on	the	board	of	directors	of	Glenwood	Academy,	the	Anti-Defamation	League	of	Chicago and	Skills	for	Chicagoland's	Future.	Mr.	Berger	is	a	graduate	of	Northeastern	University	where	he	earned	a	bachelor's	degree	and	a	graduate	of	John	M.	Olin	School	of Business	at	Washington	University	in	St.	Louis	where	he	earned	a	Master	of	Business	Administration.

Neal	J.	Campbell	serves	as	our	Senior	Vice	President	of	Strategic	Solutions	and	Services	and	is	responsible	for	CDW's	technology	solutions	teams	focusing	on cloud,	mobility,	security,	collaboration,	data	center	and	services.	Mr.	Campbell	served	as	Senior	Vice	President	and	Chief	Marketing	Officer	from	2011	to	August	2016. Prior	to	joining	CDW	in	2011,	Mr.	Campbell	served	as	Chief	Executive	Officer	of	TrafficCast,	a	provider	of	real-time	and	predictive	traffic	information	to	Google, Yahoo	and	others	from	2008	to	2011.	From	2006	to	2008,	he	served	as	Executive	Vice	President	and	General	Manager-Strategic	Marketing	and	Next	Generation Products	for	ISCO	International,	a	manufacturer	of	wireless	telecommunications	components.	Mr.	Campbell	also	spent	17	years	with	Motorola,	most	recently	as	Vice President	and	General	Manager,	GSM	Portfolio	Marketing	and	Planning	for	the	company's	mobile	device	business.	He	currently	serves	as	a	board	member	of	Junior Achievement	of	Chicago	and	is	on	the	Executive	Advisory	Council	of	Bradley	University.	Mr.	Campbell	is	a	graduate	of	Bradley	University	where	he	earned	a

bachelor's	degree	and	a	graduate	of	Northwestern	University's	Kellogg	School	of	Management	where	he	earned	a	Master	of	Business	Administration.

Mark	C.	Chong	serves	as	our	Senior	Vice	President	of	Strategy	and	Marketing	and	is	responsible	for	the	Company's	corporate	strategy;	business	development and	marketing	efforts,	including	analytics	and	insights;	brand,	advertising	and	sponsorships;	marketing	operations	and	execution;	and	corporate	communications.	Mr. Chong	joined	CDW	in	November	2016.	Prior	to	joining	CDW,	Mr.	Chong	served	as	a	Partner	in	the	Chicago	office	of	Bain	&	Company,	a	global	management consulting	firm	("Bain"),	and	as	a	leader	in	the	Technology,	Media	and	Telecom	practice	as	well	as	the	Customer	Strategy	and	Marketing	and	Mergers	&	Acquisition practice	areas.	Mr.	Chong	was	with	Bain	from	1999	to	2003,	and	then	again	from	2007	to	2016.	From	2003	to	2007,	Mr.	Chong	served	as	Director	of	Corporate	Strategy and	then	Vice	President	of	Strategy	and	Marketing	for	the	Aerospace	Business	of	Honeywell,	Intl.	Mr.	Chong	is	a	graduate	of	the	University	of	Chicago	where	he earned	a	bachelor's	degree	and	a	graduate	of	University	of	Pennsylvania's	Wharton	School	where	he	earned	a	Master	of	Business	Administration.

Christina	M.	Corley	serves	as	our	Senior	Vice	President	-	Commercial	and	International	Markets	and	is	responsible	for	all	aspects	of	the	corporate	sales	force and	for	CDW's	international	growth	platform,	including	CDW	Canada	and	CDW	UK	(which	includes	our	locations	in	Europe,	the	Middle	East,	Africa,	and	Asia). Additionally,	Ms.	Corley	is	responsible	for	ensuring	that	the	Company	is	continuing	to	build	and	fully	leverage	its	global	capabilities	while	delivering	a	consistent customer	experience.	Ms.	Corley	served	as	Senior	Vice	President	-	Corporate	Sales	from	2011	to	July	2017.	Prior	to	joining	CDW	in	2011,	Ms.	Corley	served	as President	and	Chief	Operating	Officer	of	Zones,	Inc.	("Zones"),	a	provider	of	IT	products	and	solutions,	from	2006	to	2011.	She	served	as	Executive	Vice	President	of Purchasing	and	Operations	for	Zones	from	2005	to	2006.	She	served	as	President	of	Corporate	PC	Source	("CPCS"),	a	wholly	owned	subsidiary	of	Zones,	from	2003	to 2005.	Prior	to	its	acquisition	by	Zones,	Ms.	Corley	served	as	Chief	Executive	Officer	of	CPCS	from	1999	to	2003.	Ms.	Corley	began	her	career	in	sales	and	marketing, holding	various	positions	at	IBM,	Dataflex	and	VisionTek.	She	currently	serves	as	a	board	member	of	the	Boys	and	Girls	Club	of	Chicago.	Ms.	Corley	is	a	graduate	of the	University	of	Illinois	at	Urbana-Champaign	where	she	earned	a	bachelor's	degree	and	a	graduate	of	Northwestern	University's	Kellogg	School	of	Management where	she	earned	a	Master	of	Business	Administration	in	management	and	strategy.

Douglas	E.	Eckrote	serves	as	our	Senior	Vice	President	of	Small	Business	Sales	and	eCommerce	and	is	responsible	for	managing	all	aspects	of	CDW's	Small Business	organization,	including	sales	force	strategy,	structure,	goals,	operations,	revenue	generation	and	training	and	development,	as	well	as	the	technical	solutions and	services	and	marketing	functions	specific	to	Small	Business.	Additionally,	he	oversees	CDW's	eCommerce	operations.	Mr.	Eckrote	joined	CDW	in	1989	as	an account	 manager	 and	 quickly	 rose	 through	 the	 ranks.	 Since	 joining	 the	 Company,	 he	 has	 served	 in	 a	 variety	 of	 management	 roles	 of	 increasing	 responsibility. Mr.	Eckrote	was	appointed	Director	of	Operations	in	1996,	Vice	President	of	Operations	in	1999,	Senior	Vice	President	of	Purchasing	in	April	2001,	Senior	Vice President	of	Purchasing	and	Operations	in	October	2001,	Senior	Vice	President	of	Operations,	Services	and	Canada	in	2006,	and	Senior	Vice	President	of	Strategic Solutions	and	Services	in	2009.	He	was	appointed	to	his	current	role	in	August	2016.	Mr.	Eckrote	currently	serves	on	the	National	Board	of	Make	a	Wish	of	America, the	Board	of	Directors	of	The	Northern	Illinois	Food	Bank,	the	Board	of	Trustees	of	The	Center	for	Enriched	Living	and	the	Advisory	Board	of	Feed	My	Starving Children.	Mr.	Eckrote	 is	a	graduate	of	Purdue	University	where	he	earned	a	bachelor's	degree	and	a	graduate	of	Northwestern	University's	Kellogg	School	of Management	where	he	earned	an	Executive	Master	of	Business	Administration.

Collin	B.	Kebo	serves	as	our	Senior	Vice	President	and	Chief	Financial	Officer	and	is	responsible	for	financial	planning	and	analysis,	accounting,	treasury,	tax, investor	relations,	internal	audit	and	real	estate.	From	2008	to	December	2017,	Mr.	Kebo	was	Vice	President,	Financial	Planning	and	Analysis	and,	in	2016,	he	also became	Chief	Financial	Officer	-	International.	Prior	to	joining	CDW	in	2008,	Mr.	Kebo	held	a	series	of	senior	finance	positions	with	PepsiCo,	Inc.,	a	beverage company.	Most	recently,	he	was	Vice	President	of	Sales	Finance	for	PepsiCo's	Quaker,	Tropicana	and	Gatorade	businesses.	Prior	to	that,	Mr.	Kebo	served	as	Vice President	of	Finance	and	Chief	Financial	Officer	for	Gatorade	North	America.	Mr.	Kebo	is	a	graduate	of	DePauw	University	where	he	earned	a	bachelor's	degree	and	a graduate	of	Indiana	University's	Kelley	School	of	Business	where	he	earned	his	Master	of	Business	Administration	in	Finance.

Frederick	J.	Kulevich	serves	as	our	Senior	Vice	President,	General	Counsel	and	Corporate	Secretary	and	is	responsible	for	the	legal,	corporate	governance, enterprise	risk	management,	ethics	and	compliance	functions.	Mr.	Kulevich	joined	CDW	in	2006	as	Director,	Ethics	and	Compliance.	In	2014,	he	was	appointed	Vice President	and	Assistant	General	Counsel	and	in	2016	he	was	named	Vice	President	and	Deputy	General	Counsel.	Mr.	Kulevich	was	appointed	to	his	current	role	in October	 2017.	 Before	 joining	 CDW,	 Mr.	 Kulevich	 served	 as	Associate	 General	 Counsel	 and	 Deputy	 Chief	 Compliance	 Officer	 of	Aon	 Corporation,	 a	 global professional	services	firm.	Prior	to	Aon	Corporation,	Mr.	Kulevich	was	with	Sears,	Roebuck	and	Co.,	a	national	retail	chain,	in	a	series	of	senior	legal	positions.	Mr. Kulevich	is	a	graduate	of	West	Liberty	University	where	he	earned	a	bachelor's	degree	and	a	graduate	of	The	John	Marshall	Law	School	where	he	earned	his	Juris Doctor.

Christine	A.	Leahy	serves	as	our	Chief	Revenue	Officer	and	is	responsible	for	all	customer-facing	units	of	the	Company,	including	its	Corporate,	Public,	Small Business,	International	and	Strategic	Solutions	&	Services	organizations.	Ms.	Leahy	joined	CDW	in	2002	as	the	Company's	first	general	counsel.	In	2016,	Ms.	Leahy was	appointed	Senior	Vice	President	-	International,	Chief	Legal	Officer	and	Corporate	Secretary.	Ms.	Leahy	was	appointed	to	her	current	role	in	July	2017.	Prior	to joining	CDW,	Ms.	Leahy	served	as	a	corporate	partner	in	the	Chicago	office	of	Sidley	Austin	LLP	where	she	specialized	in	mergers	and	acquisitions,	strategic counseling,	corporate	governance	and	securities	law.	Ms.	Leahy	serves	as	Vice	Chair	of	the	board	of	trustees	of	Children's	Home	and	Aid.	She	also	is	a	member	of	the Economic	Club	of	Chicago	and	The	Chicago	Network.	In	addition,	she	is	a	founder	and	current	sponsor	of	CDW's	Women's	Opportunity	Network,	a	business	resource group	dedicated	to	helping	women	advance	and	grow	into	tomorrow's	leaders.	Ms.	Leahy	is	a	graduate	of	Brown	University	where	she	earned	a	bachelor's	degree	and	a graduate	of	Boston	College	Law	School	where	she	earned	her	Juris	Doctor.	She	also	completed	the	CEO	Perspective	and	Women's	Director	Development	Programs	at Northwestern	University's	Kellogg	School	of	Management.

Christina	V.	Rother	serves	as	our	Senior	Vice	President	-	Public	and	Advanced	Technology	Sales	and	is	responsible	for	managing	all	aspects	of	our	public sector	and	advanced	technology	sales	forces,	including	sales	force	strategy,	structure,	goals,	operations,	revenue	generation	and	training	and	development.	Ms.	Rother joined	CDW	in	1991	as	an	account	manager.	In	2002,	she	was	appointed	Vice	President	for	Education	and	State	and	Local	Sales.	In	2005,	she	was	chosen	to	lead	our newly	formed	healthcare	sales	 team.	Beginning	 in	2006,	Ms.	Rother	has	held	various	positions	ranging	from	Group	Vice	President	of	CDW	Government	LLC, President	of	CDW	Government	LLC	and	Senior	Vice	President	of	Sales.	In	September	2011,	Ms.	Rother	assumed	her	current	role	as	Senior	Vice	President	of	Public and	Advanced	Technology	Sales.	Prior	to	joining	CDW,	Ms.	Rother	held	a	number	of	sales	positions	with	technology	companies	including	Laser	Computers	and	Price Electronics.	Ms.	Rother	currently	serves	as	chair	of	the	board	of	directors	of	the	Make-A-Wish	Foundation	of	Illinois.	Ms.	Rother	is	a	graduate	of	the	University	of Illinois	at	Chicago	where	she	earned	a	bachelor's	degree.

Jonathan	J.	Stevens	serves	as	our	Senior	Vice	President	-	Operations	and	Chief	Information	Officer	and	is	responsible	for	the	strategic	direction	of	our information	 technology.	Additionally,	 he	 holds	 responsibility	 for	 our	 distribution	 centers,	 transportation,	 facilities,	 customer	 relations	 and	 operational	 excellence practices.	Mr.	Stevens	joined	CDW	in	2001	as	Vice	President-Information	Technology,	was	named	Chief	Information	Officer	in	2002	and	was	named	Vice	President- International	and	Chief	Information	Officer	in	2005.	In	2007,	he	was	named	Senior	Vice	President	and	Chief	Information	Officer	and	assumed	his	current	role	in	2009. Prior	to	joining	CDW,	Mr.	Stevens	served	as	regional	technology	director	for	Avanade,	an	international	technology	integration	company	formed	through	a	joint	venture between	Microsoft	and	Accenture	from	2000	to	2001.	Prior	to	that,	Mr.	Stevens	was	a	principal	with	Microsoft	Consulting	Services	and	led	an	information	technology group	for	a	corporate	division	of	AT&T/NCR.	He	currently	serves	on	the	board	of	directors	of	SingleWire	Software,	LLC.	Mr.	Stevens	is	a	graduate	of	the	University	of Dayton	where	he	earned	a	bachelor's	degree.

Matthew	A.	Troka	serves	as	our	Senior	Vice	President	-	Product	and	Partner	Management	and	is	responsible	for	managing	our	relationships	with	all	of	our vendor	partners.	In	addition,	he	directs	the	day-to-day	operations	of	our	purchasing	department.	Mr.	Troka	joined	CDW	in	1992	as	an	account	manager	and	became	a sales	manager	in	1995.	From	1998	to	2001,	he	served	as	Corporate	Sales	Director.	From	2001	to	2004,	Mr.	Troka	was	Senior	Director	of	Purchasing.	From	2004	to 2006,	Mr.	Troka	served	as	Vice	President	of	Purchasing.	From	2006	to	2011,	Mr.	Troka	was	Vice	President	of	Product	and	Partner	Management.	Mr.	Troka	was appointed	to	his	current	role	in	2011.	Mr.	Troka	is	a	graduate	of	the	University	of	Illinois	where	he	earned	a	bachelor's	degree.

# PART	II

# Item	5.	Market	for	Registrant's	Common	Equity,	Related	Stockholder	Matters	and	Issuer	Purchases	of	Equity	Securities

# Market	Information

Our	common	stock	has	been	listed	on	the	Nasdaq	Global	Select	Market	since	June	27,	2013	under	the	symbol	"CDW."	The	following	table	sets	forth	the ranges	of	high	and	low	sales	prices	per	share	of	our	common	stock	as	reported	on	the	Nasdaq	Global	Select	Market	and	the	cash	dividends	per	share	of	common	stock declared	for	the	two	most	recent	fiscal	years.

|  |  | 2017 |  |  | 2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | High | Low | Dividends\nDeclared\tper\nShare | High | Low | Dividends\nDeclared\tper\nShare |
| Fourth\tquarter | $71.53 | $65.59 | $0.2100 | $55.47 | $43.64 | $0.1600 |
| Third\tquarter | $66.80 | $58.57 | $0.1600 | $47.50 | $39.17 | $0.1075 |
| Second\tquarter | $66.33 | $55.80 | $0.1600 | $43.11 | $37.80 | $0.1075 |
| First\tquarter | $61.00 | $50.49 | $0.1600 | $41.89 | $30.40 | $0.1075 |

# Holders

As	of	February	23,	2018,	there	were	24	holders	of	record	of	our	common	stock.	The	number	of	beneficial	stockholders	is	substantially	greater	than	the	number of	holders	of	record	because	a	portion	of	our	common	stock	is	held	through	brokerage	firms.

# Dividends

On	February	7,	2018,	we	announced	that	our	Board	of	Directors	declared	a	quarterly	cash	dividend	on	our	common	stock	of	$0.21	per	share.	The	dividend	will be	paid	on	March	12,	2018	to	all	stockholders	of	record	as	of	the	close	of	business	on	February	26,	2018.

We	expect	to	continue	to	pay	quarterly	cash	dividends	on	our	common	stock	in	the	future,	but	such	payments	remain	at	the	discretion	of	our	Board	of	Directors and	will	depend	upon	our	results	of	operations,	financial	condition,	business	prospects,	capital	requirements,	contractual	restrictions,	any	potential	indebtedness	we	may incur,	restrictions	imposed	by	applicable	law,	tax	considerations	and	other	factors	that	our	Board	of	Directors	deems	relevant.	In	addition,	our	ability	to	pay	dividends	on our	common	stock	will	be	limited	by	restrictions	on	our	ability	to	pay	dividends	or	make	distributions	to	our	stockholders	and	on	the	ability	of	our	subsidiaries	to	pay dividends	or	make	distributions	to	us,	in	each	case,	under	the	terms	of	our	current	and	any	future	agreements	governing	our	indebtedness.	For	a	discussion	of	our	cash resources	and	needs	and	restrictions	on	our	ability	to	pay	dividends,	see	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations— Liquidity	and	Capital	Resources"	included	elsewhere	in	this	report.	For	additional	discussion	of	restrictions	on	our	ability	to	pay	dividends,	see	Note	10	(Long-Term Debt)	to	the	accompanying	Consolidated	Financial	Statements.

# Issuer	Purchases	of	Equity	Securities

On	May	4,	2016,	we	announced	that	our	Board	of	Directors	authorized	a	$750	million	increase	to	our	previously	announced	$500	million	share	repurchase program	under	which	we	may	repurchase	shares	of	our	common	stock	in	the	open	market	through	privately	negotiated	or	other	transactions,	depending	on	share	price, market	conditions	and	other	factors.	On	August	3,	2017,	we	announced	that	our	Board	of	Directors	authorized	another	$750	million	increase	to	our	share	repurchase program.	As	of	the	year	ended	December	31,	2017,	we	have	$858	million	remaining	under	this	program.

# Stock	Performance	Graph

The	information	contained	in	this	Stock	Performance	Graph	section	shall	not	be	deemed	to	be	"soliciting	material"	or	"filed"	or	incorporated	by	reference	in future	filings	with	the	SEC,	or	subject	to	the	liabilities	of	Section	18	of	the	Securities	Exchange	Act	of	1934,	except	to	the	extent	that	we	specifically	incorporate	it	by reference	into	a	document	filed	under	the	Securities	Act	of	1933	or	the	Securities	Exchange	Act	of	1934.

The	following	graph	compares	the	cumulative	total	shareholder	return,	calculated	on	a	dividend	reinvested	basis,	on	$100.00	invested	at	the	closing	of	the market	on	June	27,	2013,	the	date	our	common	stock	first	traded	on	the	Nasdaq	Global	Select	Market,	through	and	including	the	market	close	on	December	31,	2017, with	the	cumulative	total	return	for	the	same	time

period	of	the	same	amount	invested	in	the	S&P	MidCap	400	index	and	a	peer	group	index.	Our	peer	group	index	for	2017	consists	of	the	following	companies: Accenture	plc,	Anixter	International,	Inc.,	Arrow	Electronics,	Inc.,	Avnet,	Inc.,	CGI	Group	Inc.,	Essendant	Inc.,	Genuine	Parts	Company,	Henry	Schein,	Inc.,	Insight Enterprises,	Inc.,	Owens	&	Minor,	Inc.,	Patterson	Companies,	Inc.,	SYNNEX	Corporation,	W.W.	Grainger,	Inc.	and	Wesco	International,	Inc.	This	peer	group	was selected	based	on	a	review	of	publicly	available	information	about	these	companies	and	our	determination	that	they	met	one	or	more	of	the	following	criteria:	(i)	similar size	in	terms	of	revenue	and/or	enterprise	value	(one-third	to	three	times	our	revenue	or	enterprise	value);	(ii)	operates	in	a	business-to-business	distribution	environment; (iii)	members	of	the	technology	industry;	(iv)	similar	customers	(i.e.,	business,	government,	healthcare,	and	education);	(v)	companies	that	provide	services	and/or solutions;	and	(vi)	similar	EBITDA	and	gross	margins.

Shareholder	returns	over	the	indicated	period	are	based	on	historical	data	and	should	not	be	considered	indicative	of	future	shareholder	returns. chart-5753173bf9f3575b922a01.jpg

|  | June	27,	2013 | December	31,	2013 | December	31,	2014 | December	31,	2015 | December	31,	2016 | December	31,	2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| CDW\tCorp | $100 | $127 | $193 | $233 | $291 | $393 |
| S&amp;P\tMidCap\t400\tindex | $100 | $114 | $126 | $123 | $148 | $172 |
| CDW\tPeers | $100 | $110 | $122 | $126 | $144 | $167 |

# Recent	Sales	of	Unregistered	Securities

# Use	of	Proceeds	from	Registered	Securities

# Item	6.	Selected	Financial	Data

The	 selected	 financial	 data	 set	 forth	 below	 are	 not	 necessarily	 indicative	 of	 the	 results	 of	 future	 operations	 and	 should	 be	 read	 in	 conjunction	 with "Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations"	and	our	Consolidated	Financial	Statements	and	the	related	notes.

We	have	derived	the	selected	financial	data	presented	below	as	of	December	31,	2017	and	2016	and	for	the	years	ended	December	31,	2017,	2016	and	2015 from	our	Consolidated	Financial	Statements	and	related	notes	included	in	this	report.	The	selected	financial	data	as	of	December	31,	2014	and	December	31,	2013	have been	derived	from	our	Consolidated	Financial	Statements	as	of	and	for	those	periods	and	are	not	included	in	this	report.

|  |  |  | Years	Ended	December	31, |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
| (dollars\tand\tshares\tin\tmillions,\texcept\tper\tshare\tamounts) | 2017 | 2016 | 2015(6) | 2014 | 2013 |
| Statement\tof\tOperations\tData: |  |  |  |  |  |
| Net\tsales | $15,191.5 | $13,981.9 | $12,988.7 | $12,074.5 | $10,768.6 |
| Cost\tof\tsales | 12,741.6 | 11,654.7 | 10,872.9 | 10,153.2 | 9,008.3 |
| Gross\tprofit | 2,449.9 | 2,327.2 | 2,115.8 | 1,921.3 | 1,760.3 |
| Selling\tand\tadministrative\texpenses | 1,410.1 | 1,345.1 | 1,226.0 | 1,110.3 | 1,120.9 |
| Advertising\texpense | 173.7 | 162.9 | 147.8 | 138.0 | 130.8 |
| Income\tfrom\toperations | 866.1 | 819.2 | 742.0 | 673.0 | 508.6 |
| Interest\texpense,\tnet | (150.5) | (146.5) | (159.5) | (197.3) | (250.1) |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | (57.4) | (2.1) | (24.3) | (90.7) | (64.0) |
| Gain\ton\tremeasurement\tof\tequity\tinvestment | — | — | 98.1 | — | — |
| Other\tincome\t(expense),\tnet | 2.1 | 1.8 | (9.3) | 2.7 | 1.0 |
| Income\tbefore\tincome\ttaxes | 660.3 | 672.4 | 647.0 | 387.7 | 195.5 |
| Income\ttax\texpense(1) | (137.3) | (248.0) | (243.9) | (142.8) | (62.7) |
| Net\tincome | $523.0 | $424.4 | $403.1 | $244.9 | $132.8 |
| Net\tincome\tper\tcommon\tshare: |  |  |  |  |  |
| Basic | $3.37 | $2.59 | $2.37 | $1.44 | $0.85 |
| Diluted | $3.31 | $2.56 | $2.35 | $1.42 | $0.84 |
| Cash\tdividends\tdeclared\tper\tcommon\tshare | $0.6900 | $0.4825 | $0.3100 | $0.1950 | $0.0425 |
| Balance\tSheet\tData\t(at\tperiod\tend): |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $144.2 | $263.7 | $37.6 | $344.5 | $188.1 |
| Working\tcapital | 863.5 | 957.4 | 903.5 | 985.4 | 810.9 |
| Total\tassets | 6,956.6 | 6,948.4 | 6,755.3 | 6,075.9 | 5,899.3 |
| Total\tdebt\tand\tcapitalized\tlease\tobligations(2)(3) | 3,236.7 | 3,236.6 | 3,262.9 | 3,166.1 | 3,226.0 |
| Total\tstockholders'\tequity | 982.9 | 1,045.5 | 1,095.9 | 936.5 | 711.7 |
| Other\tFinancial\tData: |  |  |  |  |  |
| Capital\texpenditures | $81.1 | $63.5 | $90.1 | $55.0 | $47.1 |
| Gross\tprofit\tas\ta\tpercentage\tof\tNet\tsales | 16.1% | 16.6% | 16.3% | 15.9% | 16.3% |
| EBITDA(4) | $1,071.7 | $1,073.4 | $1,033.9 | $792.9 | $653.8 |
| Adjusted\tEBITDA(4) | 1,185.6 | 1,117.3 | 1,018.5 | 907.0 | 808.5 |
| Non-GAAP\tnet\tincome(5) | 605.8 | 569.0 | 503.5 | 409.9 | 314.3 |
| Statement\tof\tCash\tFlows\tData: |  |  |  |  |  |
| Net\tcash\tprovided\tby\t(used\tin): |  |  |  |  |  |
| Operating\tactivities | $777.7 | $604.0 | $277.5 | $435.0 | $366.3 |
| Investing\tactivities | (81.1) | (65.9) | (354.4) | (164.8) | (47.1) |
| Financing\tactivities | (818.7) | (304.6) | (226.5) | (112.0) | (168.3) |

(1) Includes the	 benefit	 of the	Tax	 Cuts	 and	 Jobs	Act	 enacted	 during 2017.

(2) Excludes	borrowings	of	$498	million,	$580	million,	$440	million,	$332	million	 and	$257	million,	as	of	December	31,	2017,	2016,	2015,	2014	and	2013, respectively,	under	our	inventory	financing	agreements.	We	do	not	include	these	borrowings	in	total	debt	because	we	have	not	in	the	past	incurred,	and	in	the future	do	not	expect	to	incur,	any	interest	expense	or	late	fees	under	these	agreements.

(3) Includes	capitalized	lease	obligations	of	$1	million	and	$2	million	as	of	December	31,	2017	and	2016,	respectively,	which	are	included	in	Other	liabilities	on the	Consolidated	Balance	Sheet.

(4) EBITDA	is	defined	as	consolidated	net	income	before	interest	expense,	income	tax	expense,	depreciation	and	amortization.	Adjusted	EBITDA,	which	is	a measure	defined	in	our	credit	agreements,	means	EBITDA	adjusted	for	certain	items	which	are	described	in	the	table	below.	We	have	included	a	reconciliation of	EBITDA	and	Adjusted	EBITDA	in	the	table	below.	Both	EBITDA	and	Adjusted	EBITDA	are	considered	non-GAAP	financial	measures.	Generally,	a	non- GAAP	financial	measure	is	a	numerical	measure	of	a	company's	performance	or	financial	position	that	either	excludes	or	includes	amounts	that	are	not normally	included	or	excluded	in	the	most	directly	comparable	measure	calculated	and	presented	in	accordance	with	GAAP.	Non-GAAP	measures	used	by management	may	differ	from	similar	measures	used	by	other	companies,	even	when	similar	terms	are	used	to	identify	such	measures.

We	believe	that	EBITDA	and	Adjusted	EBITDA	provide	analysts,	investors	and	management	with	helpful	information	regarding	the	underlying	operating performance	 of	 our	 business,	 as	 they	 remove	 the	 impact	 of	 items	 that	 management	 believes	 are	 not	 reflective	 of	 underlying	 operating	 performance. Management	uses	 these	measures	 to	evaluate	period-over-period	performance	as	management	believes	 they	provide	a	more	comparable	measure	of	 the underlying	business.	Additionally,	Adjusted	EBITDA	is	a	measure	in	the	credit	agreement	governing	our	Senior	Secured	Term	Loan	Facility	("Term	Loan") used	to	evaluate	our	ability	to	make	certain	investments,	incur	additional	debt,	and	make	restricted	payments,	such	as	dividends	and	share	repurchases,	as	well as	whether	we	are	required	to	make	additional	principal	prepayments	on	the	Term	Loan	beyond	the	quarterly	amortization	payments.	For	further	details regarding	the	Term	Loan,	see	Note	10	(Long-Term	Debt)	to	the	accompanying	Consolidated	Financial	Statements.

The	following	unaudited	table	sets	forth	reconciliations	of	net	income	to	EBITDA	and	EBITDA	to	Adjusted	EBITDA	for	the	periods	presented:

|  |  | Years	Ended	December	31, | Years	Ended	December	31, |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2017 | 2016 | 2015(g) | 2014 | 2013 |
| Net\tincome | $523.0 | \t $424.4 | \t $403.1 | \t $244.9 | \t $132.8 |
| Depreciation\tand\tamortization | 260.9 | 254.5 | 227.4 | 207.9 | 208.2 |
| Income\ttax\texpense | 137.3 | 248.0 | 243.9 | 142.8 | 62.7 |
| Interest\texpense,\tnet | 150.5 | 146.5 | 159.5 | 197.3 | 250.1 |
| EBITDA | 1,071.7 | 1,073.4 | 1,033.9 | 792.9 | 653.8 |
| Non-cash\tequity-based\tcompensation | 43.7 | 39.2 | 31.2 | 16.4 | 8.6 |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt(a) | 57.4 | 2.1 | 24.3 | 90.7 | 64.0 |
| (Income)\tloss\tfrom\tequity\tinvestments(b) | (0.7) | (1.1) | 10.1 | (2.2) | (0.6) |
| Acquisition\tand\tintegration\texpenses(c) | 2.5 | 7.3 | 10.2 | — | — |
| Gain\ton\tremeasurement\tof\tequity\tinvestment(d) | — | — | (98.1) | — | — |
| Reinstatement\tof\tprior\tyear\tunclaimed\tproperty\tbalances(e) | 4.1 | — | — | — | — |
| Other\tadjustments(f) | 6.9 | (3.6) | 6.9 | 9.2 | 82.7 |
| Adjusted\tEBITDA | $1,185.6 | \t $1,117.3 | \t $1,018.5 | \t $907.0 | \t $808.5 |

(a) During	the	years	ended	December	31,	2017,	2016,	2015,	2014	and	2013,	we	recorded	net	losses	on	extinguishments	of	long-term	debt.	The	losses represented	the	difference	between	the	amount	paid	upon	extinguishment,	including	call	premiums	and	expenses	paid	to	the	debt	holders	and	agents, and	the	net	carrying	amount	of	the	extinguished	debt,	adjusted	for	a	portion	of	the	unamortized	deferred	financing	costs.

(b) Represents	our	share	of	(Income)	loss	from	our	equity	investments.	Our	35%	share	of	CDW	UK's	net	loss	includes	our	35%	share	of	an	expense related	to	certain	equity	awards	granted	by	one	of	the	sellers	to	CDW	UK	coworkers	in	July	2015	prior	to	the	acquisition.

(c) Comprised of expenses related to	 CDW UK.

(d) Represents	 the	gain	resulting	from the	remeasurement	of	our	previously	held	35%	equity investment to	fair	value	upon the	completion	of the acquisition	of	CDW	UK.

(e) Comprised	of	the	reinstatement	of	prior	year	unclaimed	property	balances	as	a	result	of	a	retroactive	Illinois	state	law	change	enacted	during 2017.

(f) Primarily	 includes	 expenses	 related	 to	 payroll	 taxes	 on	 equity-based	 compensation	 during	 2017.	The	year	ended	December	31,	2016	primarily includes	our	share	of	the	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action	lawsuits	and	the	favorable	resolution of	a	local	sales	tax	matter,	partially	offset	by	expenses	related	to	the	consolidation	of	office	locations	north	of	Chicago.	During	the	year	ended December	31,	2013,	we	recorded	IPO	and	secondary	offering-	related	expenses	of	$75	million.

(g) Includes	the	impact	of	consolidating	five	months	of	CDW	UK's	financial	results	for	the	year	ended	December	31, 2015.

(5) Non-GAAP	net	 income	excludes,	among	other	 things,	charges	related	 to	 the	amortization	of	acquisition-related	 intangible	assets,	non-cash	equity-based compensation,	acquisition	and	integration	expenses,	and	gains	and	losses	from	the	extinguishments	of	long-term	debt.	Non-GAAP	net	income	is	considered	a non-GAAP	financial	measure.	Generally,	a	non-GAAP	financial	measure	is	a	numerical	measure	of	a	company's	performance	or	financial	position	that	either excludes	or	includes	amounts	that	are	not	normally	included	or	excluded	in	the	most	directly	comparable	measure	calculated	and	presented	in	accordance	with GAAP.	Non-GAAP	measures	used	by	management	may	differ	from	similar	measures	used	by	other	companies,	even	when	similar	terms	are	used	to	identify such	measures.	We	believe	 that	non-GAAP	net	 income	provides	analysts,	 investors	and	management	with	helpful	 information	regarding	 the	underlying operating	performance	of	our	business,	as	this	measure	removes	the	impact	of	items	that	management	believes	are	not	reflective	of	underlying	operating performance.	Management	uses	this	measure	to	evaluate	period-over-period	performance	as	management	believes	it	provides	a	more	comparable	measure	of the	underlying	business.

The	following	unaudited	table	sets	forth	a	reconciliation	of	net	income	to	non-GAAP	net	income	for	the	periods	presented:

|  |  | Years	Ended	December	31, | Years	Ended	December	31, |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2017 | 2016 | 2015(h) | 2014 | 2013 |
| Net\tincome | $523.0 | \t $424.4 | \t $403.1 | \t $244.9 | \t $132.8 |
| Amortization\tof\tintangibles(a) | 185.1 | 187.2 | 173.9 | 161.2 | 161.2 |
| Non-cash\tequity-based\tcompensation | 43.7 | 39.2 | 31.2 | 16.4 | 8.6 |
| Non-cash\tequity-based\tcompensation\trelated\tto\tequity\tinvestment(b) | — | — | 20.0 | — | — |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 57.4 | 2.1 | 24.3 | 90.7 | 64.0 |
| Acquisition\tand\tintegration\texpenses(c) | 2.5 | 7.3 | 10.2 | — | — |
| Gain\ton\tremeasurement\tof\tequity\tinvestment(d) | — | — | (98.1) | — | — |
| Reinstatement\tof\tprior\tyear\tunclaimed\tproperty\tbalances(e) | 4.1 | — | — | — | — |
| Other\tadjustments(f) | 4.9 | (5.4) | 3.7 | (0.3) | 61.2 |
| Aggregate\tadjustment\tfor\tincome\ttaxes(g) | (214.9) | (85.8) | (64.8) | (103.0) | (113.5) |
| Non-GAAP\tnet\tincome | $605.8 | \t $569.0 | \t $503.5 | \t $409.9 | \t $314.3 |

(a) Includes	 amortization	 expense for	 acquisition-related intangible	 assets,	 primarily	 customer relationships,	 customer	 contracts	 and trade names.

(b) Represents	our	35%	share	of	an	expense	related	to	certain	equity	awards	granted	by	one	of	the	sellers	to	CDW	UK	coworkers	in	July	2015	prior	to	our acquisition	of	CDW	UK.

(e) Comprised	of	the	reinstatement	of	prior	year	unclaimed	property	balances	as	a	result	of	a	retroactive	Illinois	law	change	enacted	during 2017.

(f) Primarily	 includes	expenses	related	 to	payroll	 taxes	on	equity-based	compensation	during	2017.	The	year	ended	December	31,	2016	primarily includes	our	share	of	the	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action	lawsuits	and	the	favorable	resolution of	a	local	sales	tax	matter,	partially	offset	by

expenses	related	to	the	consolidation	of	office	locations	north	of	Chicago.	The	amount	in	2013	primarily	relates	to	IPO	and	secondary	offering-related expenses.

(g) Aggregate adjustment for income taxes consists of the following:

|  | 2017 | 2016 | 2015 | 2014 | 2013 |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Total\tNon-GAAP\tadjustments | $297.7 | $230.4 | $165.2 | $268.0 | $295.0 |
| Weighted-average\tstatutory\teffective\trate | 36.0% | 36.0% | 38.0% | 39.0% | 39.0% |
| Income\ttax | (107.2) | (82.9) | (62.8) | (104.5) | (115.1) |
| Deferred\ttax\tadjustment\tdue\tto\tlaw\tchanges | 1.3 | (1.5) | (4.0) | — | — |
| Excess\ttax\tbenefits\tfrom\tequity-based\tcompensation | (36.2) | (1.8) | — | — | — |
| Tax\tCuts\tand\tJobs\tAct |  |  |  |  |  |
|  | (75.5) | — | — | — | — |
| Withholding\ttax\texpense\ton\tthe\tunremitted\tearnings\tof\tour\tCanadian\nsubsidiary | — | — | 3.3 | — | — |
| Non-deductible\tadjustments\tand\tother | 2.7 | 0.4 | (1.3) | 1.5 | 1.6 |
| Total\taggregate\tadjustment\tfor\tincome\ttaxes | $(214.9) | $(85.8) | $(64.8) | $(103.0) | $(113.5) |

(h) Includes	the	impact	of	consolidating	five	months	for	the	year	ended	December	31,	2015	of	CDW	UK's	financial results.

(6) Includes	the	impact	of	consolidating	five	months	of	CDW	UK's	financial	results	for	the	year	ended	December	31, 2015.

# Item	7.	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations

Unless	otherwise	indicated	or	the	context	otherwise	requires,	as	used	in	this	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of Operations,"	the	terms	"we,"	"us,"	"the	Company,"	"our,"	"CDW"	and	similar	terms	refer	to	CDW	Corporation	and	its	subsidiaries.	"Management's	Discussion	and Analysis	of	Financial	Condition	and	Results	of	Operations"	should	be	read	in	conjunction	with	the	Consolidated	Financial	Statements	and	the	related	notes	included elsewhere	in	this	report.	This	discussion	contains	forward-looking	statements	that	are	subject	to	numerous	risks	and	uncertainties.	Actual	results	may	differ	materially from	those	contained	in	any	forward-looking	statements.	See	"Forward-Looking	Statements"	above.

# Overview

CDW	Corporation	is	a	Fortune	500	company	and	a	leading	provider	of	integrated	IT	solutions	to	small,	medium	and	large	business,	and	government,	education and	healthcare	customers	in	the	US,	the	UK	and	Canada.	Our	broad	array	of	offerings

ranges	from	discrete	hardware	and	software	products	to	integrated	IT	solutions	such	as	mobility,	security,	data	center	optimization,	cloud	computing,	virtualization	and collaboration.

We	are	technology	"agnostic,"	with	a	product	portfolio	including	more	than	100,000	products	and	services	from	more	than	1,000	leading	and	emerging	brands. Our	 solutions	 are	 delivered	 in	 physical,	 virtual	 and	 cloud-based	 environments	 through	 over	6,000	 customer-facing	 coworkers,	 including	 sellers,	 highly-skilled technology	specialists	and	advanced	service	delivery	engineers.	We	are	a	leading	sales	channel	partner	for	many	original	equipment	manufacturers	("OEMs"),	software publishers	and	cloud	providers	(collectively,	our	"vendor	partners"),	whose	products	we	sell	or	include	in	the	solutions	we	offer.	We	provide	our	vendor	partners	with	a cost-effective	way	to	reach	customers	and	deliver	a	consistent	brand	experience	through	our	established	end-market	coverage,	technical	expertise	and	extensive	customer access.

In	August	2015,	we	acquired	CDW	UK,	which	enhanced	our	ability	to	provide	IT	solutions	to	US	based	customers	with	multinational	locations.	It	 also extended	our	footprint	into	the	United	Kingdom.	Financial	results	of	CDW	UK	are	included	in	our	Consolidated	Financial	Statements	from	the	date	of	acquisition.

We	have	three	reportable	segments,	Corporate,	Small	Business	and	Public.	Our	Corporate	segment	primarily	serves	private	sector	business	customers	with more	than	250	employees.	Our	Small	Business	segment	primarily	serves	private	sector	business	customers	with	up	to	250	employees.	Our	Public	segment	is	comprised of	government	agencies	and	education	and	healthcare	institutions	in	the	US.	We	also	have	two	other	operating	segments:	Canada	and	CDW	UK,	each	of	which	do	not meet	the	reportable	segment	quantitative	thresholds	and,	accordingly,	are	included	in	an	all	other	category	("Other").

We	may	sell	all	or	only	select	products	that	our	vendor	partners	offer.	Each	vendor	partner	agreement	provides	for	specific	terms	and	conditions,	which	may include	one	or	more	of	the	following:	product	return	privileges,	price	protection	policies,	purchase	discounts	and	vendor	incentive	programs,	such	as	purchase	or	sales rebates	and	cooperative	advertising	reimbursements.	We	also	resell	software	for	major	software	publishers.	Our	agreements	with	software	publishers	allow	the	end-user customer	to	acquire

software	or	licensed	products	and	services.	In	addition	to	helping	our	customers	determine	the	best	software	solutions	for	their	needs,	we	help	them	manage	their software	agreements,	including	warranties	and	renewals.	A	significant	portion	of	our	advertising	and	marketing	expenses	is	reimbursed	through	cooperative	advertising programs	with	our	vendor	partners.	These	programs	are	at	the	discretion	of	our	vendor	partners	and	are	typically	tied	to	sales	or	other	commitments	to	be	met	by	us within	a	specified	period	of	time.

# Trends	and	Key	Factors	Affecting	our	Financial	Performance

We	believe	the	following	trends	and	key	factors	may	have	an	important	impact	on	our	financial	performance:

•General	economic	conditions	are	a	key	factor	affecting	our	ability	to	generate	sales	and	achieve	our	targeted	operating	results	as	they	impact	our	customers' willingness	to	spend	on	information	technology.	This	is	particularly	the	case	for	business	customers,	as	their	purchases	tend	to	reflect	confidence	in	their business	prospects,	which	are	driven	by	their	perceptions	of	business	conditions.	Purchasing	behavior	may	be	different	between	our	Corporate	customers	and Small	Business	customers	due	to	their	perception	of	business	conditions.

•Changes	in	spending	policies,	budget	priorities	and	revenue	levels	are	a	key	factor	influencing	government	purchasing	levels.	Our	Government	results	also reflect	increased	interest	in	meeting	public	safety	needs	through	technology	solutions	by	State	and	Local	customers,	as	well	as	our	ability	to	address	strategic changes	made	by	the	Federal	government	toward	a	more	programmatic	technology	strategy.

•Customer	focus	on	security	has	been,	and	we	expect	will	continue	to	be,	an	ongoing	trend.	Customers	are	seeking	solutions	to	protect	their	internal	systems against	 threats	 and	 are	 implementing	 solutions	 that	 provide	 enterprise-wide	 visibility,	 detection	 expertise	 and	 investigation	 workflows.	 They	 are	 also implementing	endpoint	security,	firewall	segmentation	and	user	authentication	tools.

•The	Healthcare	industry	continues	to	experience	uncertainty	given	recent	proposed	legislative	action	and	concerns	related	to	funding,	which	is	impacting healthcare	spending	as	customers	seek	more	clarity.

•Our	Education	sales	channel	performance	continues	to	benefit	from	the	creation	of	new	learning	environments	for	students.	It	has	also	been	positively	affected by	the	implementation	of	networking	projects	related	to	the	US	Federal	Communications	Commission	E-Rate	program.	Within	the	higher	education	market, networking	projects	continue	to	be	a	key	priority	across	campuses.	While	technology	is	an	opportunity	to	create	cost	savings	and	improve	productivity,	funding is	a	key	determinant	of	technology	spending	in	education.

•There	continues	to	be	substantial	uncertainty	regarding	the	impact	of	the	Referendum	on	the	United	Kingdom's	("UK")	Membership	of	the	European	Union ("EU"),	advising	for	the	exit	of	the	UK	from	the	EU	(referred	to	as	"Brexit").	Potential	adverse	consequences	of	Brexit	such	as	global	market	uncertainty, volatility	in	currency	exchange	rates,	greater	restrictions	on	imports	and	exports	between	UK	and	EU	countries	and	increased	regulatory	complexities	could have	a	negative	impact	on	our	business,	financial	condition	and	results	of	operations.	To	date,	CDW	UK	is	not	seeing	significant	changes	in	the	buying behavior	of	its	customers	even	with	the	uncertainty	related	to	the	timing	and	terms	of	Brexit.

•Technology	trends	drive	customer	purchase	behaviors	and	we	are	seeing	continuing	evolution	in	the	market.	Innovation	influences	customer	purchases	across all	of	our	customer	end-markets.	Key	trends	in	technology	include	increasing	adoption	of	cloud-based	solutions	for	certain	key	workloads,	including	backup and	recovery,	collaboration	and	security,	as	well	as	adoption	of	hyper-converged	appliances	to	deliver	greater	flexibility	and	efficiency.	In	addition,	hybrid	IT solutions	are	being	adopted,	along	with	software	being	embedded	into	solutions.

# Key	Business	Metrics

We	monitor	a	number	of	financial	and	non-financial	measures	and	ratios	on	a	regular	basis	in	order	to	track	the	progress	of	our	business	and	make	adjustments as	necessary.	We	believe	that	the	most	important	of	these	measures	and	ratios	include	average	daily	sales,	gross	margin,	operating	margin,	Net	income,	Non-GAAP income	before	income	taxes,	Non-GAAP	net	income,	Net	income	per	common	share,	Non-GAAP	net	income	per	diluted	share,	EBITDA,	Adjusted	EBITDA,	Adjusted EBITDA	margin,	free	cash	flow,	return	on	working	capital,	Cash	and	cash	equivalents,	net	working	capital,	cash	conversion	cycle	(defined	 to	be	days	of	sales outstanding	in	Accounts	receivable	plus	days	of	supply	in	Inventory	minus	days	of	purchases	outstanding	in	Accounts	payable,	based	on	a	rolling	three-month	average), debt	levels	including	available	credit	and	leverage	ratios,	sales	per	coworker	and	coworker	turnover.	These	measures	and	ratios	are	compared	to	standards	or	objectives set	by	management,	so	that	actions	can	be	taken,	as	necessary,	in	order	to	achieve	the	standards	and	objectives.

In	this	Form	10-K,	we	discuss	Non-GAAP	income	before	income	taxes,	Non-GAAP	net	income,	Non-GAAP	net	income	per	diluted	share,	EBITDA,	Adjusted EBITDA	and	Adjusted	EBITDA	margin,	which	are	non-GAAP	financial	measures.

We	believe	these	measures	provide	analysts,	investors	and	management	with	helpful	information	regarding	the	underlying	operating	performance	of	our business,	as	they	remove	the	impact	of	items	that	management	believes	are	not	reflective	of	underlying	operating	performance.	Management	uses	these	measures	to evaluate	period-over-period	performance	as	management	believes	they	provide	a	more	comparable	measure	of	the	underlying	business.	Additionally,	Adjusted	EBITDA is	a	measure	in	the	credit	agreement	governing	our	Senior	Secured	Term	Loan	Facility	("Term	Loan"),	which	is	used	to	evaluate	our	ability	to	make	certain	investments, incur	 additional	 debt,	 and	 make	 restricted	 payments,	 such	 as	 dividends	 and	 share	 repurchases,	 as	 well	 as	 whether	 we	 are	 required	 to	 make	 additional	 principal prepayments	 on	 the	Term	 Loan	 beyond	 the	 quarterly	 amortization	 payments.	 For	 further	 details	 regarding	 the	Term	 Loan,	 see	 Long-Term	 Debt	 and	 Financing Arrangements	within	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	and	Note	10	(Long-Term	Debt)	to	the	accompanying Consolidated	Financial	Statements.	For	the	definitions	of	Non-GAAP	income	before	income	taxes,	Non-GAAP	net	income	and	Adjusted	EBITDA	and	reconciliations	to Net	income,	see	"Results	of	Operations".

The	results	of	certain	key	business	metrics	are	as	follows:

| (dollars	in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Net\tsales | $15,191.5 | $13,981.9 | $12,988.7 |
| Gross\tprofit | 2,449.9 | 2,327.2 | 2,115.8 |
| Income\tfrom\toperations | 866.1 | 819.2 | 742.0 |
| Net\tincome | 523.0 | 424.4 | 403.1 |
| Non-GAAP\tnet\tincome | 605.8 | 569.0 | 503.5 |
| Adjusted\tEBITDA | 1,185.6 | 1,117.3 | 1,018.5 |
| Average\tdaily\tsales | 59.8 | 55.0 | 51.1 |
| Net\tdebt(1) | 3,091.3 | 2,970.7 | 3,222.1 |
| Cash\tconversion\tcycle\t(in\tdays)(2) | 19 | 19 | 21 |

(1) Defined	 as Total debt minus Cash and cash equivalents.

(2) Cash	conversion	cycle	 is	defined	as	days	of	sales	outstanding	 in	Accounts	receivable	and	certain	receivables	due	from	vendors	plus	days	of	supply	 in Merchandise	inventory	minus	days	of	purchases	outstanding	in	Accounts	payable	and	Accounts	payable-inventory	financing,	based	on	a	rolling	three-month average.

# Results	of	Operations

Results	of	operations,	in	dollars	and	as	a	percentage	of	Net	sales	are	as	follows:

|  | Dollars	in<br>Millions | Percentage	of<br>Net	Sales	(1) | Dollars	in<br>Millions | Percentage	of<br>Net	Sales	(1) |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $15,191.5 | 100.0\t% | $13,981.9 | 100.0\t% |
| Cost\tof\tsales | 12,741.6 | 83.9 | 11,654.7 | 83.4 |
| Gross\tprofit | 2,449.9 | 16.1 | 2,327.2 | 16.6 |
| Selling\tand\tadministrative\texpenses | 1,410.1 | 9.3 | 1,345.1 | 9.6 |
| Advertising\texpense | 173.7 | 1.1 | 162.9 | 1.2 |
| Income\tfrom\toperations | 866.1 | 5.7 | 819.2 | 5.9 |
| Interest\texpense,\tnet | (150.5) | (1.0) | (146.5) | (1.0) |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | (57.4) | (0.4) | (2.1) | — |
| Other\tincome,\tnet | 2.1 | — | 1.8 | — |
| Income\tbefore\tincome\ttaxes | 660.3 | 4.3 | 672.4 | 4.8 |
| Income\ttax\texpense | (137.3) | (0.9) | (248.0) | (1.8) |
| Net\tincome | $523.0 | 3.4\t% | $424.4 | 3.0\t% |

# Net	sales

Net	sales	by	segment,	in	dollars	and	as	a	percentage	of	total	Net	sales,	and	the	year-over-year	dollar	and	percentage	change	in	Net	sales	are	as	follows:

|  | 2017 |  | 2016 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Percentage |  | Percentage |  |  |
|  |  | of\tTotal |  | of\tTotal | Dollar | Percent |
| (dollars\tin\tmillions) | Net\tSales | Net\tSales | Net\tSales | Net\tSales | Change | Change(1) |
| Corporate(2) | $6,347.0 | 41.8% | $5,889.8 | 42.1% | $457.2 | 7.8\t% |
| Small\tBusiness(2) | 1,246.5 | 8.2 | 1,140.1 | 8.2 | 106.4 | 9.3 |
| Public: |  |  |  |  |  |  |
| Government | 2,167.5 | 14.3 | 1,863.7 | 13.3 | 303.8 | 16.3 |
| Education | 2,211.4 | 14.6 | 2,018.3 | 14.4 | 193.1 | 9.6 |
| Healthcare | 1,658.6 | 10.9 | 1,707.4 | 12.2 | (48.8) | (2.9) |
| Total\tPublic | 6,037.5 | 39.7 | 5,589.4 | 40.0 | 448.1 | 8.0 |
| Other | 1,560.5 | 10.3 | 1,362.6 | 9.7 | 197.9 | 14.5 |
| Total\tNet\tsales | $15,191.5 | 100.0% | $13,981.9 | 100.0% | $1,209.6 | 8.7\t% |

(2) Amounts	 have	 been recast for	 2016 to	 present	 Small	 Business	 as its	 own	 operating	 and reportable segment.

For	the	year	ended	December	31,	2017,	sales	growth	was	driven	by	gains	in	all	our	customer	markets	except	Healthcare,	which	saw	a	Net	sales	decline	year over	year.	During	the	year,	and	in	contrast	to	2016,	we	saw	an	acceleration	of	hardware	sales,	driven	by	strong	growth	within	client	device	sales	due	to	customer	refresh, which	impacted	categories	such	as	notebooks,	mobile	devices	and	desktops.	Additionally,	we	saw	growth	in	several	other	categories,	including	video	and	networking. We	also	saw	ongoing	customer	focus	on	designing	IT	securely,	which	led	to	strong	sales	growth	across	our	entire	security	portfolio	and	the	adoption	of	more	efficient architectures,	which	drove	strong	growth	in	hyper-converged	infrastructure	and	solutions	delivered	via	the	cloud,	as	well	as	the	continuing	trend	of	greater	integration	of software	into	solutions.

Corporate	segment	Net	sales	in	2017	increased	$457	million,	or	7.8%,	compared	to	2016,	as	customer	confidence	improved	throughout	the	year.	Growth	was primarily	driven	by	customer	refresh	of	client	devices	and	networking.

Small	Business	segment	Net	sales	in	2017	increased	by	$106	million,	or	9.3%,	compared	to	2016.	Sales	growth	was	primarily	driven	by	customer	refresh	of client	devices	and	video.

Public	 segment	 Net	 sales	 in	2017	increased	$448	million,	 or	8.0%,	 compared	 to	2016.	The	growth	was	primarily	driven	by	Government	and	Education customers.	Net	sales	to	Federal	government	customers	reflected	a	focus	on	spending	existing	budgets	on	planned	projects	and	ongoing	successful	alignment	with strategic	programs,	as	well	as	success	meeting	the	Department	of	Defense	mandated	move	to	new	client	devices	with	stronger	security	features.	Strong	Net	sales	to	our State	and	Local	government	customers	was	driven	by	a	continued	focus	on	public	safety	and	the	on-going	success	executing	against	recently	added	contracts.	Net	sales to	our	Higher	Education	customers	were	driven	by	networking	and	software	as	we	continued	to	see	the	benefit	from	"connected	campus"	strategies	to	ensure	network infrastructures	can	handle	multiple	devices	used	by	students,	faculty	and	visitors	across	the	entire	campus.	K-12	growth	was	driven	by	success	in	delivering	collaborative learning	environments	and	networking.	Net	sales	to	Healthcare	customers	decreased	2.9%,	reflecting	continued	customer	uncertainty	related	to	reimbursements	and funding.

Net	sales	in	Other	for	2017	increased	$198	million,	or	14.5%,	compared	to	2016.	Other	is	comprised	of	results	from	our	Canadian	and	UK	operations.	Both operations	had	strong	growth	in	local	currency	as	we	continued	to	take	share	in	the	local	markets,	as	well	as	the	benefit	from	increased	sales	for	referrals	from	US customers	to	the	UK.	The	impact	of	foreign	currency	exchange	decreased	Other	sales	growth	by	approximately	250	basis	points,	due	to	the	impact	resulting	from	the British	pound	to	US	dollar	translation,	partially	offset	by	favorable	translation	of	the	Canadian	to	US	dollar.

# Gross	profit

Gross	 profit	increased	$123	million,	 or	5.3%,	 to	$2,450	million	 in	2017,	 compared	 to	$2,327	million	 in	2016.	As	a	percentage	of	Net	sales,	Gross	profit decreased	50	basis	points	to	16.1%	in	2017,	down	from	16.6%	in	2016.	Although	there	was	an	increase	in	Gross	profit	due	to	higher	sales	volumes,	we	experienced	a decline	in	our	Gross	profit	margin.	This	decline	was	primarily	driven	by	product	margin	compression	due	to	increased	hardware	sales,	which	generally	have	lower	profit margins,	and	an	ongoing	competitive	marketplace.

Gross	profit	margin	may	fluctuate	based	on	various	factors,	including	vendor	incentive	and	inventory	price	protection	programs,	cooperative	advertising	funds classified	as	a	reduction	of	cost	of	sales,	product	mix,	net	service	contract	revenue,	commission	revenue,	pricing	strategies,	market	conditions	and	other	factors.

# Selling	and	administrative	expenses

Selling	and	administrative	expenses	increased	$65	million,	or	4.8%,	to	$1,410	million	in	2017,	compared	to	$1,345	million	in	2016.	This	was	driven	by	higher sales	payroll	costs,	including	sales	commissions,	year	over	year,	primarily	due	to	higher	Gross	profit,	as	well	as	higher	coworker	costs	between	years	consistent	with increased	coworker	count.	Total	coworker	count	was	8,726	at	December	31,	2017,	up	210	from	8,516	at	December	31,	2016.	Additionally,	equity-based	compensation expense	and	the	associated	payroll	taxes	increased	$8	million,	or	19.8%,	during	2017	compared	to	2016,	primarily	due	to	the	impact	of	annual	equity	awards	granted under	our	Long-Term	Incentive	Plan	and	the	vesting	of	an	equity	grant	made	at	the	time	of	our	initial	public	offering.	Also	during	2017,	a	retroactive	Illinois	state	law change	was	enacted	which	required	the	reinstatement	of	unclaimed	property	balances,	resulting	in	an	additional	$4	million	of	expenses.	These	increases	were	partially offset	by	lower	senior	management	incentive	compensation.

As	a	percentage	of	total	Net	sales,	Selling	and	administrative	expenses	decreased	30	basis	points	to	9.3%	in	2017,	down	from	9.6%	in	2016.

# Income	from	operations

Income	from	operations	by	segment,	in	dollars	and	as	a	percentage	of	Net	sales,	and	the	year-over-year	percentage	change	was	as	follows:

|  | Dollars	in<br>Millions | Operating<br>Margin | Dollars	in<br>Millions | Operating<br>Margin | Percent	Change<br>in	Income<br>from	Operations |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Segments:(1) |  |  |  |  |  |
| Corporate(2) | $487.0 | 7.7% | $453.6 | 7.7% | 7.4% |
| Small\tBusiness(2) | 74.4 | 6.0 | 68.9 | 6.0 | 8.0 |
| Public | 374.0 | 6.2 | 368.0 | 6.6 | 1.6 |
| Other(3) | 57.9 | 3.7 | 43.6 | 3.2 | 32.8 |
| Headquarters(4) | (127.2) | nm* | (114.9) | nm* | 10.7 |
| Total\tIncome\tfrom\toperations | $866.1 | 5.7% | $819.2 | 5.9% | 5.7% |

# *	Not	meaningful

(1) Segment	income	from	operations	includes	the	segment's	direct	operating	income,	allocations	for	certain	Headquarters'	costs,	allocations	for	income	and expenses	from	logistics	services,	certain	inventory	adjustments	and	volume	rebates	and	cooperative	advertising	from	vendors.

(3) Includes the	 financial	 results	 for	 our	 other	 operating	 segments,	 CDW	 Canada	 and	 CDW	 UK,	 which	 do	 not	 meet the	 reportable	 segment	 quantitative thresholds.

(4) Includes	 Headquarters' function costs that are not allocated to the segments.

Income	from	operations	was	$866	million	in	2017,	an	increase	of	$47	million,	or	5.7%,	compared	to	$819	million	in	2016.	Although	Income	from	operations increased,	total	operating	margin	percentage	decreased	20	basis	points	to	5.7%	 in	2017,	 from	5.9%	 in	2016.	The	decrease	was	primarily	due	to	Gross	profit	margin compression	from	higher	hardware	sales	and	an	ongoing	competitive	marketplace.	Also	contributing	to	lower	operating	margin	percentage	was	the	reinstatement	of prior	year	unclaimed	property	balances	in	2017	and	the	non-recurrence	of	the	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action lawsuits	in	2016.	Partially	offsetting	these	decreases	were	lower	sales	payroll,	consistent	with	our	variable	compensation	cost	structure,	lower	senior	management incentive	compensation	and	a	decline	in	intangible	asset	amortization	expense	as	a	percentage	of	Net	sales.

Corporate	segment	Income	from	operations	was	$487	million	 in	2017,	an	increase	 of	$33	million,	 or	7.4%,	 compared	 to	$454	million	 in	2016.	Corporate segment	operating	margin	remained	flat	at	7.7%	for	2017	and	2016.	Although	Income	from	operations	increased,	primarily	due	to	an	increase	in	sales	volume,	Corporate segment	operating	margin	percentage	remained	flat.	The	flat	operating	margin	percentage	reflects	higher	hardware	sales	and	an	ongoing	competitive	marketplace,	which were	fully	offset	by	lower	sales	payroll	expenses.

Small	Business	segment	Income	from	operations	was	$74	million	in	2017,	an	increase	of	$5	million,	or	8.0%,	compared	to	$69	million	in	2016.	Income	from operations	increased	due	to	an	increase	in	sales	volume,	while	operating	margin	remained	flat	at	6.0%	for	2017	and	2016.	The	flat	operating	margin	percentage	reflects higher	hardware	sales	and	an	ongoing	competitive	marketplace,	which	were	fully	offset	by	lower	sales	payroll	expenses.

Public	segment	Income	from	operations	was	$374	million	 in	2017,	an	increase	 of	$6	million,	 or	1.6%,	 compared	 to	$368	million	 in	2016.	Public	segment operating	margin	decreased	40	basis	points	to	6.2%	in	2017,	from	6.6%	in	2016.	This	decrease	in	operating	margin	percentage	was	primarily	driven	by	higher	hardware sales,	which	were	partially	offset	by	lower	sales	payroll	expenses.

Other	Income	from	operations	was	$58	million	in	2017,	an	increase	of	$14	million,	or	32.8%,	compared	to	$44	million	in	2016.	Other	Income	from	operations increased	primarily	due	to	higher	sales	volumes	and	Gross	profit	as	we	continue	to	take	share	in	the	local	markets.	Other	operating	margin	percentage	increased	50	basis points	to	3.7%	in	2017,	from	3.2%	in	2016.	This	increase	was	primarily	driven	by	a	decline	in	intangible	asset	amortization	expense	as	a	percentage	of	Net	sales.

# Interest	expense,	net

Net	interest	expense	in	2017	was	$151	million,	an	increase	of	$4	million,	compared	to	$147	million	in	2016.	This	increase	was	primarily	driven	by	mark-to- market	gains	recognized	on	our	interest	rate	cap	agreements	in	2016,	with	no	comparable	activity	in	2017	due	to	the	election	of	hedge	accounting	in	February	2017	and by	a	rising	interest	rate	environment	which	resulted	in	higher	interest	expense	on	the	Term	Loan.	This	was	partially	offset	by	a	reduced	coupon	rate	due	to	the	refinancing activity	that	occurred	during	2017.

# Net	loss	on	extinguishments	of	long-term	debt

For	information	regarding	our	debt,	see	Note	10	(Long-Term	Debt)	to	the	accompanying	Consolidated	Financial	Statements.	During	2017,	we	recorded	a	net loss	on	extinguishments	of	long-term	debt	of	$57	million	compared	to	$2	million	in	2016.

Net	loss	on	extinguishments	of	long-term	debt	are	as	follows:

| Month	of	Extinguishment | Debt	Instrument | Amount	Extinguished | Loss	Recognized |
| :--- | :--- | :--- | :--- |
| For\tthe\tYear\tEnded\tDecember\t31,\t2017 |  |  |  |
| February\t2017 | Senior\tSecured\tTerm\tLoan\tFacility | $1,483.0 | $(13.7) |
| March\t2017 | Senior\tNotes\tdue\t2022 | 600.0 | (42.5) |
| March\t2017 | Senior\tsecured\tasset-based\trevolving\tcredit\tfacility | — | (1.2) |
|  | Total\tLoss\tRecognized |  | $(57.4) |
| For\tthe\tYear\tEnded\tDecember\t31,\t2016 |  |  |  |
| August\t2016 | Senior\tSecured\tTerm\tLoan\tFacility | $1,490.4 | $(2.1) |
|  | Total\tLoss\tRecognized |  | $(2.1) |

(1) We	repaid	all	of	the	remaining	aggregate	principal	amount	outstanding.	The	loss	recognized	represents	the	difference	between	the	aggregate	principal	amount and	the	net	carrying	amount	of	the	purchased	debt,	adjusted	for	the	remaining	unamortized	deferred	financing	costs	and	premium.

# Income	tax	expense

On	December	22,	2017,	the	Tax	Cuts	and	Jobs	Act	was	enacted	into	law.	The	Tax	Cuts	and	Jobs	Act	changes	several	aspects	of	US	federal	tax	law	including: reducing	the	US	corporate	income	tax	rate	from	35%	to	21%	beginning	on	January	1,	2018;	establishing	a	territorial	tax	system,	which	includes	a	one-time	tax	on	the deemed	mandatory	repatriation	of	our	international	operations'	unremitted	earnings	which	have	not	been	subject	to	US	tax;	imposing	a	minimum	US	tax	on	foreign earnings;	providing	for	the	immediate	expensing	of	certain	qualified	property;	and	changing	the	tax	treatment	of	performance	based	executive	compensation	and	certain employee	fringe	benefits.	GAAP	requires	the	income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act	to	be	accounted	for	in	the	period	of	enactment.

The	SEC	issued	Staff	Accounting	Bulletin	118	allowing	for	provisional	amounts	to	be	recorded	during	a	measurement	period	not	to	exceed	one	year.	We recorded	provisional	amounts	for	the	impact	of	revaluing	deferred	tax	assets	and	liabilities,	the	deemed	mandatory	repatriation	tax	of	our	international	operations' unremitted	earnings	and	the	state	income	tax	effects	from	the	change	in	federal	tax	law.	We	continue	to	analyze	the	income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act,	as well	as	monitor	guidance	from	the	Internal	Revenue	Service	and	the	US	Treasury	Department.	Any	additional	income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act	are expected	to	be	recorded	within	the	measurement	period.

Income	tax	expense	was	$137	million	in	2017,	compared	to	$248	million	in	2016.	The	effective	income	tax	rate,	expressed	by	calculating	income	tax	expense	as a	percentage	of	Income	before	income	taxes,	was	20.8%	and	36.9%	for	2017	and	2016,	respectively.	We	expect	to	have	an	effective	tax	rate	of	between	24%	and	25%	in 2018.	The	2018	effective	tax	rate	may	change	due	to	various	factors	including:	adjustments	we	make	to	the	estimates	of	the	impact	of	the	Tax	Cuts	and	Jobs	Act	that were	recorded	as	of	December	31,	2017,	as	well	as	additional	guidance	that	the	Internal	Revenue	Service,	US	Treasury	Department	and	state	taxing	authorities	may issue,	changes	in	the	estimated	excess	tax	benefits	due	to	the	changes	in	the	market	value	of	our	common	stock	and	changes	in	the	number	of	awards	vesting	and	changes in	state	tax	laws.

For	2017,	the	effective	tax	rate	differed	from	the	US	federal	statutory	rate	primarily	due	to	a	one-time	benefit	of	$96	million	to	reflect	the	revaluation	of deferred	tax	assets	and	liabilities,	excess	tax	benefits	on	equity	compensation	and	lower	corporate	tax	rates	on	our	international	income,	partially	offset	by	state	income taxes	and	a	one-time	charge	of	$20	million	for	the	mandatory	repatriation	tax.	For	2016,	the	effective	tax	rate	differed	from	the	US	federal	statutory	rate	primarily	due	to state	income	taxes	and	non-deductible	meals	and	entertainment	expenses,	which	were	partially	offset	by	lower	corporate	tax	rates	on	our	international	income,	a deferred	 tax	 benefit	 as	 a	 result	 of	 a	 tax	 rate	 reduction	 in	 the	 UK	 and	 excess	 tax	 benefits	 on	 equity-based	 compensation	 as	 a	 result	 of	 adopting	ASU	 2016-09, Compensation	-	Stock	Compensation.	The	lower	effective	tax	rate	for	2017	as	compared	to	2016	was	primarily	attributable	to	the	impact	of	revaluing	deferred	tax	assets and	liabilities,	and	excess	tax	benefits	on	equity	compensation,	offset	by	a	one-time	charge	for	the	mandatory	repatriation	tax.

# Non-GAAP	Financial	Measure	Reconciliations

We	have	included	reconciliations	of	Non-GAAP	income	before	income	taxes,	Non-GAAP	net	income,	EBITDA,	Adjusted	EBITDA,	Adjusted	EBITDA margin	and	consolidated	Net	sales	growth	on	a	constant	currency	basis	for	the	years	ended	December	31,	2017	and	2016	below.

Non-GAAP	income	before	income	taxes	and	Non-GAAP	net	income	exclude,	among	other	things,	charges	related	to	the	amortization	of	acquisition-related intangible	assets,	equity-based	compensation	and	associated	taxes,	gains	and	losses	from	the	extinguishment	of	debt	and	integration	expenses.	EBITDA	is	defined	as consolidated	net	income	before	interest	expense,	net,	income	tax	expense,	depreciation	and	amortization.	Adjusted	EBITDA,	which	is	a	measure	defined	in	our	credit agreements,	means	EBITDA	adjusted	for	certain	 items	which	are	described	 in	 the	 table	below.	Adjusted	EBITDA	margin	 is	defined	as	Adjusted	EBITDA	as	a percentage	of	Net	sales.	Consolidated	Net	sales	growth	on	a	constant	currency	basis	is	defined	as	consolidated	Net	sales	growth	excluding	the	impact	of	foreign	currency translation	on	net	sales	compared	to	the	prior	period.

Non-GAAP	income	before	income	taxes,	Non-GAAP	net	income,	EBITDA,	Adjusted	EBITDA,	Adjusted	EBITDA	margin	and	consolidated	Net	sales	growth on	 a	 constant	 currency	 basis	 are	 considered	 non-GAAP	 financial	 measures.	 Generally,	 a	 non-GAAP	 financial	 measure	 is	 a	 numerical	 measure	 of	 a	 company's performance	or	financial	position	 that	either	excludes	or	 includes	amounts	 that	are	not	normally	 included	or	excluded	 in	 the	most	directly	comparable	measure calculated	and	presented	in	accordance	with	GAAP.	Non-GAAP	measures	used	by	management	may	differ	from	similar	measures	used	by	other	companies,	even	when similar	terms	are	used	to	identify	such	measures.

We	believe	these	measures	provide	analysts,	investors	and	management	with	helpful	information	regarding	the	underlying	operating	performance	of	our business,	as	they	remove	the	impact	of	items	that	management	believes	are	not	reflective	of	underlying	operating	performance.	Management	uses	these	measures	to evaluate	period-over-period	performance	as	management	believes	they	provide	a	more	comparable	measure	of	the	underlying	business.	Additionally,	Adjusted	EBITDA is	a	measure	in	the	credit	agreement	governing	our	Term	Loan	used	to	evaluate	our	ability	to	make	certain	investments,	incur	additional	debt	and	make	restricted payments,	such	as	dividends	and	share	repurchases,	as	well	as	whether	we	are	required	to	make	additional	principal	prepayments	on	the	Term	Loan	beyond	the	quarterly amortization	payments.	For	further	details	regarding	the	Term	Loan,	see	Note	10	(Long-Term	Debt)	to	the	accompanying	Consolidated	Financial	Statements.

# Non-GAAP	income	before	income	taxes	and	Non-GAAP	net	income

| (in	millions) | Income	before<br>income	taxes | Income	tax<br>benefit	(expense) | Net	income | Income	before<br>income	taxes | benefit<br>(expense) | Net	income |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| GAAP\t(as\treported) | $660.3 | $(137.3) | $523.0 | $672.4 | $(248.0) | $424.4 |
| Amortization\tof\tintangibles(1) | 185.1 | (66.6) | 118.5 | 187.2 | (67.4) | 119.8 |
| Equity-based\tcompensation(2) | 43.7 | (51.9) | (8.2) | 39.2 | (15.9) | 23.3 |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 57.4 | (20.7) | 36.7 | 2.1 | (0.8) | 1.3 |
| Integration\texpenses(3) | 2.5 | (0.9) | 1.6 | 7.3 | (2.6) | 4.7 |
| Reinstatement\tof\tprior\tyear\tunclaimed\tproperty\tbalances(4) | 4.1 | (1.5) | 2.6 | — | — | — |
| Deferred\ttax\tadjustment\tdue\tto\tstate\tlaw\tchanges | — | 1.3 | 1.3 | — | (1.5) | (1.5) |
| Tax\tCuts\tand\tJobs\tAct | — | (75.5) | (75.5) | — | — | — |
| Other\tadjustments(5) | 4.9 | 0.9 | 5.8 | (5.4) | 2.4 | (3.0) |
| Non-GAAP | $958.0 | $(352.2) | $605.8 | $902.8 | $(333.8) | $569.0 |

(1) Includes	 amortization	 expense for	 acquisition-related intangible	 assets,	 primarily	 customer relationships,	 customer	 contracts	 and trade names.

(2) Includes excess tax benefits related to equity-based compensation.

(3) Comprised of expenses related to	 CDW UK.

(4) Comprised	of	the	reinstatement	of	prior	year	unclaimed	property	balances	as	a	result	of	a	retroactive	Illinois	state	law	change	enacted	during 2017.

(5) Primarily	includes	expenses	related	to	payroll	taxes	on	equity-based	compensation	during	2017.	The	year	ended	December	31,	2016	primarily	includes	our share	of	the	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action	lawsuits	and	the	favorable	resolution	of	a	local	sales	tax matter,	partially	offset	by	expenses	related	to	the	consolidation	of	office	locations	north	of	Chicago.

# Adjusted	EBITDA

|  |  | Years	Ended	December	31, | Years	Ended	December	31, |  |
| :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | 2017 | Percentage\tof\nNet\tSales | 2016 | Percentage\tof\nNet\tSales |
| Net\tincome | $523.0 | 3.4% | $424.4 | 3.0% |
| Depreciation\tand\tamortization | 260.9 |  | 254.5 |  |
| Income\ttax\texpense | 137.3 | 248.0 | 248.0 |  |
| Interest\texpense,\tnet | 150.5 |  | 146.5 |  |
| EBITDA | 1,071.7 | 7.1% | 1,073.4 | 7.7% |
| Adjustments: |  |  |  |  |
| Equity-based\tcompensation | 43.7 | 39.2 | 39.2 |  |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 57.4 | 2.1 | 2.1 |  |
| Income\tfrom\tequity\tinvestment(1) | (0.7) | (1.1) | (1.1) |  |
| Integration\texpenses(2) | 2.5 | 7.3 | 7.3 |  |
| Reinstatement\tof\tprior\tyear\tunclaimed\tproperty\tbalances(3) | 4.1 |  | — |  |
| Other\tadjustments(4) | 6.9 | (3.6) | (3.6) |  |
| Total\tadjustments | 113.9 | 43.9 | 43.9 |  |
| Adjusted\tEBITDA | $1,185.6 | 7.8% | $1,117.3 | 8.0% |

(1) Represents our share of net income from our equity investment.

(4) Primarily	includes	expenses	related	to	payroll	taxes	on	equity-based	compensation	and	historical	retention	costs	during	2017.	The	year	ended	December	31, 2016	primarily	includes	our	share	of	the	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action	lawsuits	and	the	favorable resolution	of	a	local	sales	tax	matter,	partially	offset	by	expenses	related	to	the	consolidation	of	office	locations	north	of	Chicago.

# Consolidated	Net	sales	growth	on	a	constant	currency	basis

Consolidated	Net	sales	increased	$1,210	million,	or	8.7%,	to	$15,192	million	for	the	year	ended	December	31,	2017,	compared	to	$13,982	million	for	the	year ended	December	31,	2016.	Consolidated	Net	sales	on	a	constant	currency	basis,	which	excludes	the	impact	of	foreign	currency	translation,	increased	$1,238	million,	or 8.9%,	to	$15,192	million	for	the	year	ended	December	31,	2017,	compared	to	$13,954	million	for	the	year	ended	December	31,	2016.

| (in	millions) | 2017 | 2016 | %	Change | Average	Daily	%<br>Change(1) |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales,\tas\treported | $15,191.5 | $13,981.9 | 8.7% | 8.7% |
| Foreign\tcurrency\ttranslation(2) | — | (28.3) |  |  |
| Consolidated\tNet\tsales,\ton\ta\tconstant\tcurrency\tbasis | $15,191.5 | $13,953.6 | 8.9% | 8.9% |

(2) Represents	the	effect	of	translating	the	prior	year	results	of	CDW	Canada	and	CDW	UK	at	the	average	exchange	rates	applicable	in	the	current year.

|  | Dollars	in<br>Millions | Percentage	of<br>Net	Sales	(1) | Dollars	in<br>Millions | Percentage	of<br>Net	Sales	(1) |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $13,981.9 | 100.0\t% | $12,988.7 | 100.0\t% |
| Cost\tof\tsales | 11,654.7 | 83.4 | 10,872.9 | 83.7 |
| Gross\tprofit | 2,327.2 | 16.6 | 2,115.8 | 16.3 |
| Selling\tand\tadministrative\texpenses | 1,345.1 | 9.6 | 1,226.0 | 9.4 |
| Advertising\texpense | 162.9 | 1.2 | 147.8 | 1.1 |
| Income\tfrom\toperations | 819.2 | 5.9 | 742.0 | 5.7 |
| Interest\texpense,\tnet | (146.5) | (1.0) | (159.5) | (1.2) |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | (2.1) | — | (24.3) | (0.2) |
| Gain\ton\tremeasurement\tof\tequity\tinvestment | — | — | 98.1 | 0.8 |
| Other\tincome\t(expense),\tnet | 1.8 | — | (9.3) | (0.1) |
| Income\tbefore\tincome\ttaxes | 672.4 | 4.8 | 647.0 | 5.0 |
| Income\ttax\texpense | (248.0) | (1.8) | (243.9) | (1.9) |
| Net\tincome | $424.4 | 3.0\t% | $403.1 | 3.1\t% |

|  | 2016 |  | 2015 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Percentage |  | Percentage | Dollar | Percent |
| (dollars\tin\tmillions) | Net\tSales | of\tTotal\tNet\tsales | Net\tSales | of\tTotal\tNet\tSales | Change | Change\t(1) |
| Corporate\t(2) | $5,889.8 | 42.1% | $5,878.7 | 45.3% | $11.1 | 0.2% |
| Small\tBusiness\t(2) | 1,140.1 | 8.2 | 1,089.6 | 8.4 | 50.5 | 4.6 |
| Public: |  |  |  |  |  |  |
| Government | 1,863.7 | 13.3 | 1,700.9 | 13.1 | 162.7 | 9.6 |
| Education | 2,018.3 | 14.4 | 1,818.8 | 14.0 | 199.5 | 11.0 |
| Healthcare | 1,707.4 | 12.2 | 1,663.9 | 12.8 | 43.5 | 2.6 |
| Total\tPublic | 5,589.4 | 40.0 | 5,183.6 | 39.9 | 405.7 | 7.8 |
| Other | 1,362.6 | 9.7 | 836.8 | 6.4 | 525.9 | 62.8 |
| Total\tNet\tsales | $13,981.9 | 100.0% | $12,988.7 | 100.0% | $993.2 | 7.6% |

(2) Amounts	 have	 been recast to	 present	 Small	 Business	 as its	 own	 operating and reportable segment.

Total	Net	sales	in	2016	increased	$993	million,	or	7.6%,	to	$13,982	million,	compared	to	$12,989	million	in	2015,	reflecting	both	solid	organic	increases	and the	inclusion	of	seven	months	of	incremental	CDW	UK	sales.	Total	Net	sales	increased	8.3%	on	a	constant	currency	basis.	There	were	five	key	trends	that	impacted	our Net	sales	growth.	First,	customers	were	seeking	to	optimize	their	infrastructure	by	extending	asset	lives	or	adding	capacity,	which	led	to	increases	in	warranties	and virtualization	software.	Second,	customer	focus	on	designing	IT	securely	continued	to	be	a	major	area	of	interest	for	customers,	and	we	saw	excellent	increases	across our	 entire	 security	 portfolio,	 including	 security	 software.	We	 also	 saw	 our	 customers	 seeking	 architectures	 to	 increase	 the	 flexibility	 and	 efficiency	 of	 their	 IT infrastructure,	which	drove	increased	adoption	of	cloud	solutions	for	certain	workloads,	including	security,	as	well	as	increased	sales	of	hyper-converged	infrastructure. Fourth,	we	saw	the	on-going	trend	where	a	greater	proportion	of	solutions	are	being	delivered	via	software.	With	software	becoming	more	"mission	critical,"	customers continued	to	turn	to	software	assurance	to	protect	their	investment.	Finally,	customer	demand	for	digital	signage	and	video	screens,	as	well	as	notebook/mobile	devices, drove	growth	across	all	of	our	customer	end-markets.

Corporate	segment	Net	sales	in	2016	increased	$11	million,	or	0.2%,	year	over	year,	as	customer	demand	for	longer	tail	purchases,	including	data	center	and networking	solutions,	was	impacted	by	slow	economic	growth	and	market	trends.	Corporate	had	strong	sales	performance	in	notebook/mobile	devices	and	software products.

Economic	conditions	had	less	of	an	impact	on	Small	Business	results,	as	Net	sales	to	Small	Business	customers	increased	by	$51	million,	or	4.6%,	between periods,	driven	by	growth	in	notebooks/mobile	devices,	desktops	and	video	projection	hardware.

Public	segment	Net	sales	in	2016	increased	$406	million,	or	7.8%,	between	years.	Net	sales	to	government	customers	increased	$163	million,	or	9.6%.	State and	local	government	customers	continued	to	focus	on	public	safety	and	we	benefited	from	new	contracts.	Our	Federal	channel	saw	low	single-digit	growth	as	the success	we	had	meeting	new	strategic	programs	was	partially	offset	by	the	impact	of	several	large	client	device	purchase	orders	that	were	delayed	into	2017.	Net	sales	to education	customers	increased	$199	million,	or	11.0%,	year	over	year,	driven	by	continued	success	providing	client	devices	to	support	digital	testing	and	curriculums,	as well	 as	 desktops	 and	 video	 projection	 hardware	 to	 support	 new	 learning	 environments	 for	 students.	 Healthcare	 growth	 was	2.6%	 or	$43	 million,	 driven	 by notebooks/mobile	devices,	desktops,	and	software.	Patient	data	security	continues	to	be	a	top	concern.	We	continued	to	see	some	of	our	larger	customers	shifting priorities	to	reducing	costs	due	to	industry	consolidation.

Net	sales	in	Other,	which	is	comprised	of	our	Canadian	and	CDW	UK	operations,	increased	$526	million,	or	62.8%,	compared	to	2015.	The	increase	in	Net sales	was	primarily	driven	by	the	impact	of	consolidating	twelve	months	of	CDW	UK	Net	sales	in	2016	compared	to	consolidating	five	months	of	CDW	UK	results	in 2015.	Both	our	Canadian	and	UK	businesses	grew

high-single	digits	in	local	currency	in	2016.	Currency	was	impacted	by	Canadian	dollar	to	US	dollar	translation	in	the	first	half	of	the	year	and	British	pound	to	US dollar	translation	in	the	second	half.

Gross	profit	margin	was	positively	impacted	by	a	higher	mix	of	net	service	contract	revenue	as	customers	looked	to	extend	the	life	of	equipment	through warranties,	protect	their	software	investments	through	software	assurance	and	adopt	cloud	solutions	to	deliver	certain	workloads.	All	of	these	solutions	grew	faster	than our	overall	Net	sales.	In	addition,	vendor	partner	funding	positively	impacted	gross	margin.	These	increases	helped	offset	the	impact	from	unfavorable	product	margin.

Selling	and	administrative	expenses	increased	$119	million,	or	9.7%,	to	$1,345	million	in	2016,	compared	to	$1,226	million	in	2015.	As	a	percentage	of	total Net	sales,	Selling	and	administrative	expenses	increased	20	basis	points	to	9.6%	in	2016,	up	from	9.4%	in	2015.	Payroll	costs	increased	$65	million,	or	11.7%,	year	over year,	primarily	due	to	incremental	coworker	hires	at	the	end	of	2015,	higher	compensation	costs	consistent	with	increased	Gross	profit	and	the	inclusion	of	twelve months	of	CDW	UK	payroll	costs	in	2016	compared	to	five	months	in	2015.	Total	coworker	count	was	8,516	at	December	31,	2016,	up	51	from	8,465	at	December	31, 2015.	Amortization	expense	related	to	intangibles	increased	$18	million,	or	8.8%,	during	2016	compared	to	2015,	primarily	due	to	incremental	amortization	expense related	 to	 the	 intangible	 assets	 arising	 from	 our	 acquisition	 of	 CDW	 UK.	 Non-cash	 equity-based	 compensation	 expense	 increased	 $8	 million,	 or 25.8%, during	2016	compared	to	2015,	primarily	due	to	annual	equity	awards	granted	under	our	2013	Long-Term	Incentive	Plan,	performance	against	long-term	incentive program	targets	and	equity	awards	granted	in	connection	with	our	acquisition	of	CDW	UK.

|  | Dollars	in<br>Millions | Operating<br>Margin | Dollars	in<br>Millions | Operating<br>Margin | Percent	Change<br>in	Income<br>from	Operations |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Segments:\t(1) |  |  |  |  |  |
| Corporate(2)(3)(4) | $453.6 | 7.7% | $432.5 | 7.4% | 4.9% |
| Small\tBusiness(2)(3)(4) | 68.9 | 6.0 | 68.3 | 6.3 | 0.9 |
| Public(2)(4) | 368.0 | 6.6 | 328.6 | 6.3 | 12.0 |
| Other(4)(5) | 43.6 | 3.2 | 27.1 | 3.2 | 60.9 |
| Headquarters(6) | (114.9) | nm* | (114.5) | nm* | 0.3 |
| Total\tIncome\tfrom\toperations | $819.2 | 5.9% | $742.0 | 5.7% | 10.4% |

(2) Certain	costs	related	to	technology	specialists	have	been	reclassified	between	our	Corporate,	Small	Business	and	Public	segments.	The	prior	period	has	been reclassified	to	conform	to	the	current	period	presentation.

(4) Effective	January	1,	2016,	CDW	Advanced	Services	is	included	in	our	Corporate,	Small	Business	and	Public	segments	and	Other	is	comprised	of	CDW Canada	and	CDW	UK.	The	prior	period	has	been	reclassified	to	conform	to	the	current	period	presentation.

(6) Includes	Headquarters'	function	costs	that	are	not	allocated	to	the	segments.	Certain	Headquarters	expenses	have	been	allocated	to	CDW	Canada	in	2016.	The prior	period	has	been	reclassified	to	conform	to	the	current	period	presentation.

Income	 from	 operations	 was	$819	 million	 in	2016,	 an	 increase	 of	$77	 million,	 or	10.4%,	 compared	 to	$742	 million	 in	2015.	 Total	 operating margin	increased	20	basis	points	to	5.9%	in	2016,	from	5.7%	in	2015.	Operating	margin	was	positively	impacted	by	the	increase	in	Gross	profit	margin,	driven	by	higher contribution	from	net	service	contract	revenue	and	vendor	partner	funding.	Selling	and	administrative	expenses	as	a	percentage	of	Net	sales	increased	20	basis	points	in 2016	versus	2015,	primarily	reflecting	increased	sales	compensation	and	coworker	costs	resulting	from	the	inclusion	of	CDW	UK	expenses	for	twelve	months	in	2016 compared	to	five	months	in	2015.

Corporate	segment	income	from	operations	was	$454	million	 in	2016,	an	increase	 of	$21	million,	 or	4.9%,	 compared	 to	$433	million	 in	2015.	Corporate segment	operating	margin	increased	30	basis	points	to	7.7%	in	2016,	from	7.4%	in	2015.	This	increase	was	primarily	due	to	an	increase	in	Gross	profit	driven	by	a higher	mix	of	net	service	contract	revenue,	as	well	as	higher	volume	rebates,	partially	offset	by	an	increase	in	Selling	and	administrative	expenses	as	a	percentage	of	Net sales,	due	to	higher	sales	payroll	costs.

Small	Business	segment	income	from	operations	was	$69	million	in	2016,	an	increase	 of	$1	million,	 or	0.9%,	compared	 to	2015.	Small	Business	operating margin	decreased	by	30	basis	points	to	6.0%	in	2016,	from	6.3%	in	2015.	The	decrease	in	operating	margin	was	primarily	due	to	an	increase	in	Selling	and	administrative expenses	as	a	percentage	of	Net	sales,	due	to	higher	sales	payroll	costs.

Public	segment	income	from	operations	was	$368	million	in	2016,	an	increase	of	$39	million,	or	12.0%,	compared	to	$329	million	 in	2015.	Public	segment operating	margin	increased	30	basis	points	to	6.6%	in	2016,	from	6.3%	in	2015.	This	decrease	was	driven	primarily	due	to	an	increase	in	Net	sales	and	Gross	profit driven	by	a	higher	mix	of	net	service	contract	revenue,	as	well	as	higher	volume	rebates,	partially	offset	by	an	increase	in	Selling	and	administrative	expenses	as	a percentage	of	Net	sales,	due	to	higher	sales	payroll	costs.

Other	income	from	operations	was	$44	million	in	2016,	an	increase	of	$17	million,	or	60.9%,	compared	to	$27	million	in	2015.	This	was	primarily	due	to	the inclusion	of	an	additional	seven	months	of	CDW	UK	income	from	operations.	Other	operating	margin	percentage	remained	flat	at	3.2%	in	both	2016	and	2015.

At	December	31,	2016,	our	outstanding	long-term	debt	totaled	$3,234	million,	compared	to	$3,260	million	at	December	31,	2015,	a	decrease	of	$26	million primarily	due	to	principal	payments	on	the	loans.	Net	interest	expense	in	2016	was	$147	million,	a	decrease	of	$13	million,	compared	to	$160	million	in	2015.	This decrease	was	primarily	due	to	the	lower	effective	interest	rates	and	the	lower	principal	loan	balances	for	2016	 compared	 to	2015	as	a	result	of	redemptions	and refinancing	activities	completed	during	2016	and	2015,	and	the	impact	in	2016	of	mark-to-market	gains	associated	with	our	interest	rate	cap	agreements.

| Month	of	Extinguishment | Debt	Instrument | Amount	Extinguished | Loss	Recognized |
| :--- | :--- | :--- | :--- |
| For\tthe\tYear\tEnded\tDecember\t31,\t2016 |  |  |  |
| August\t2016 | Senior\tSecured\tTerm\tLoan\tFacility | $1,490.4 | $(2.1) |
|  | Total\tLoss\tRecognized |  | $(2.1) |
| For\tthe\tYear\tEnded\tDecember\t31,\t2015 |  |  |  |
| March\t2015 | 2019\tSenior\tNotes | $503.9 | $(24.3) |
|  | Total\tLoss\tRecognized |  | $(24.3) |

# Gain	on	remeasurement	of	equity	investment

On	August	1,	2015,	we	completed	the	acquisition	of	CDW	UK	by	purchasing	the	remaining	65%	of	its	outstanding	common	stock	which	increased	our ownership	interest	from	35%	to	100%,	and	provided	us	control.	As	a	result,	our	previously	held	35%	equity	investment	was	remeasured	to	fair	value,	resulting	in	a	gain of	$98	million	recorded	in	Gain	on	remeasurement	of	equity	investment	in	the	Consolidated	Statements	of	Operations.

Income	tax	expense	was	$248	million	in	2016,	compared	to	$244	million	in	2015.	The	effective	income	tax	rate,	expressed	by	calculating	income	tax	expense or	benefit	as	a	percentage	of	income	before	income	taxes,	was	36.9%	and	37.7%	for	2016	and	2015,	respectively.

For	2016,	the	effective	tax	rate	differed	from	the	US	federal	statutory	rate	primarily	due	to	state	income	taxes	and	non-deductible	meals	and	entertainment expenses,	which	were	partially	offset	by	lower	corporate	tax	rates	on	our	international	income,	a	deferred	tax	benefit	as	a	result	of	a	tax	rate	reduction	in	the	UK	and excess	tax	benefits	on	equity	compensation	as	a	result	of	adopting	ASU	2016-09.	For	2015,	the	effective	tax	rate	differed	from	the	US	federal	statutory	rate	primarily due	to	state	income	taxes	and	withholding	tax	expense	on	the	earnings	of	our	Canadian	business	as	a	result	of	no	longer	asserting	permanent	reinvestment,	which	was partially	offset	by	a	deferred	tax	benefit	as	a	result	of	a	tax	rate	reduction	in	the	UK.	The	lower	effective	tax	rate	for	2016	as	compared	to	2015	was	primarily	attributable to	a	larger	benefit	in	2016	related	to	our	international	income,	which	is	taxed	at	lower	tax	rates	than	our	US	income,	excess	tax	benefits	on	equity	compensation	as	a result	of	adopting	ASU	2016-09	in	2016	and	less	Canadian	withholding	tax	expense	in	2016	than	in	2015,	partially	offset	by	a	greater	deferred	tax	benefit	related	to	UK tax	rate	reductions	in	2015	than	in	2016.

We	have	included	reconciliations	of	Non-GAAP	income	before	income	taxes,	Non-GAAP	net	income,	EBITDA,	Adjusted	EBITDA,	Adjusted	EBITDA margin	and	consolidated	Net	sales	growth	on	a	constant	currency	basis	for	the	years	ended	December	31,	2016	and	2015	below.	See	the	"Non-GAAP	Financial	Measure Reconciliations"	section	included	above	for	the	years	ended	December	31,	2017	and	2016	for	all	Non-GAAP	measure	definitions.

# Non-GAAP	net	income

|  | Income	before<br>income	taxes | Income	tax<br>benefit	(expense) | Net	income | Income	before<br>income	taxes | benefit<br>(expense) | Net	income |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\treported | $672.4 | $(248.0) | $424.4 | $647.0 | $(243.9) | $403.1 |
| Amortization\tof\tintangibles(1) | 187.2 | (67.4) | 119.8 | 173.9 | (66.1) | 107.8 |
| Equity-based\tcompensation(2) | 39.2 | (15.9) | 23.3 | 31.2 | (11.9) | 19.3 |
| Equity-based\tcompensation\trelated\tto\tequity\tinvestment(3) | — | — | — | 20.0 | (7.6) | 12.4 |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 2.1 | (0.8) | 1.3 | 24.3 | (9.2) | 15.1 |
| Acquisition\tand\tintegration\texpenses(4) | 7.3 | (2.6) | 4.7 | 10.2 | (3.9) | 6.3 |
| Gain\ton\tremeasurement\tof\tequity\tinvestment(5) | — | — | — | (98.1) | 37.3 | (60.8) |
| Deferred\ttax\tadjustment\tdue\tto\tstate\tlaw\tchanges | — | (1.5) | (1.5) | — | (4.0) | (4.0) |
| Withholding\ttax\texpense\ton\tthe\tunremitted\tearnings\tof\tour\nCanadian\tsubsidiary | — | — | — | — | 3.3 | 3.3 |
| Other\tadjustments(6) | (5.4) | 2.4 | (3.0) | 3.7 | (2.7) | 1.0 |
| Non-GAAP | $902.8 | $(333.8) | $569.0 | $812.2 | $(308.7) | $503.5 |

(3) Represents	our	35%	share	of	an	expense	related	to	certain	equity	awards	granted	by	one	of	the	sellers	to	CDW	UK	coworkers	in	July	2015	prior	to	our acquisition	of	CDW	UK.

(4) Comprised	of	expenses	related	to	CDW

(5) Represents	the	gain	resulting	from	the	remeasurement	of	our	previously	held	35%	equity	investment	to	fair	value	upon	the	completion	of	the	acquisition	of CDW	UK.

(6) Primarily	includes	our	share	of	settlement	payments	received	from	the	Dynamic	Random	Access	Memory	class	action	lawsuits	and	the	favorable	resolution	of a	local	sales	tax	matter	during	the	year	ended	December	31,	2016.	Also	includes	expenses	related	to	the	consolidation	of	office	locations	north	of	Chicago during	the	years	ended	December	31,	2016	and	2015.

| (in	millions) | 2016 | Percentage	of<br>Net	Sales | 2015 | Percentage	of<br>Net	Sales |
| :--- | :--- | :--- | :--- | :--- |
| Net\tincome | $424.4 | 3.0% | $403.1 | 3.1% |
| Depreciation\tand\tamortization | 254.5 |  | 227.4 |  |
| Income\ttax\texpense | 248.0 |  | 243.9 |  |
| Interest\texpense,\tnet | 146.5 |  | 159.5 |  |
| EBITDA | 1,073.4 | 7.7% | 1,033.9 | 8.0% |
| Adjustments: |  |  |  |  |
| Non-cash\tequity-based\tcompensation | 39.2 |  | 31.2 |  |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 2.1 |  | 24.3 |  |
| (Income)\tloss\tfrom\tequity\tinvestments(1) | (1.1) |  | 10.1 |  |
| Acquisition\tand\tintegration\texpenses(2) | 7.3 |  | 10.2 |  |
| Gain\ton\tremeasurement\tof\tequity\tinvestment(3) | — |  | (98.1) |  |
| Other\tadjustments(4) | (3.6) |  | 6.9 |  |
| Total\tadjustments | 43.9 |  | (15.4) |  |
| Adjusted\tEBITDA(5) | $1,117.3 | 8.0% | $1,018.5 | 7.8% |

(1) Represents	our	share	of	(income)	loss	from	our	equity	investments.	Our	35%	share	of	CDW	UK's	net	loss	for	the	year	ended	December	31,	2015	includes	our 35%	share	of	an	expense	related	to	certain	equity	awards	granted	by	one	of	the	sellers	to	CDW	UK	coworkers	in	July	2015	prior	to	the	acquisition.

Consolidated	Net	sales	increased	$993	million,	or	7.6%,	to	$13,982	million	for	the	year	ended	December	31,	2016,	compared	to	$12,989	million	for	the	year ended	December	31,	2015.	Consolidated	Net	sales	on	a	constant	currency	basis,	which	excludes	the	impact	of	foreign	currency	translation,	increased	$1,070	million,	or 8.3%,	to	$13,982	million	for	the	year	ended	December	31,	2016,	compared	to	$12,912	million	for	the	year	ended	December	31,	2015.

| (in	millions) | 2016 | 2015 | %	Change | Average	Daily	%	Change	(1) |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales,\tas\treported | $13,981.9 | $12,988.7 | 7.6% | 7.6% |
| Foreign\tcurrency\ttranslation(2) | — | (76.3) |  |  |
| Consolidated\tNet\tsales,\ton\ta\tconstant\tcurrency\tbasis | $13,981.9 | $12,912.4 | 8.3% | 8.3% |

(2) Represents	the	effect	of	translating	the	prior	year	results	of	CDW	Canada	and	CDW	UK	at	the	average	exchange	rates	applicable	in	the	current	year.	Includes the	impact	of	consolidating	five	months	of	CDW	UK's	financial	results	for	the	year	ended	December	31,	2015.

# Seasonality

While	we	have	not	historically	experienced	significant	seasonality	throughout	the	year,	sales	in	our	Corporate	segment,	which	primarily	serves	private	sector business	customers	with	more	than	250	employees,	are	typically	higher	in	the	fourth	quarter	than	in	other	quarters	due	to	customers	spending	their	remaining	technology budget	dollars	at	the	end	of	the	year.	Additionally,	sales	in	our	Public	segment	have	historically	been	higher	in	the	third	quarter	than	in	other	quarters	primarily	due	to the	buying	patterns	of	the	federal	government	and	education	customers.

# Liquidity	and	Capital	Resources

We	finance	our	operations	and	capital	expenditures	with	internally	generated	cash	from	operations.	We	also	have	$996	million	of	availability	for	borrowings under	our	senior	secured	asset-based	revolving	credit	facility	and	an	additional	£50	million	($68	million	at	December	31,	2017)	under	the	CDW	UK	revolving	credit facility.	Our	liquidity	and	borrowing	plans	are	established	to	align	with	our	financial	and	strategic	planning	processes	and	ensure	we	have	the	necessary	funding	to	meet our	operating	commitments,	which	primarily	include	the	purchase	of	inventory,	payroll	and	general	expenses.	We	also	take	into	consideration	our	overall	capital allocation	strategy,	which	includes	investment	for	future	growth,	dividend	payments,	acquisitions	and	stock	repurchases.	We	believe	we	have	adequate	sources	of liquidity	and	funding	available	for	at	least	the	next	year,	however,	there	are	a	number	of	factors	that	may	negatively	impact	our	available	sources	of	funds.	The	amount of	cash	generated	from	operations	will	be	dependent	upon	factors	such	as	the	successful	execution	of	our	business	plan	and	general	economic	conditions.

# Long-Term	Debt	Activities

On	March	31,	2017,	we	amended,	extended	and	increased	our	Revolving	Loan	to	a	five-year,	$1.5	billion	senior	secured	asset-based	revolving	credit	facility, with	the	facility	being	available	to	us	for	borrowings,	issuance	of	letters	of	credit	and	floorplan	financing.	In	connection	with	the	amendment	of	the	previous	facility,	we recorded	a	loss	on	extinguishment	of	long-term	debt	of	$1	million	in	the	Consolidated	Statement	of	Operations	during	2017,	representing	a	write-off	of	a	portion	of unamortized	deferred	financing	costs.	Fees	of	$4	million	related	to	the	Revolving	Loan	were	capitalized	as	deferred	financing	costs	and	are	being	amortized	over	the five-year	term	of	the	facility	on	a	straight-line	basis.	These	deferred	financing	costs	are	recorded	in	Other	assets	on	the	Consolidated	Balance	Sheets.

On	March	2,	2017,	the	proceeds	from	the	issuance	of	the	2025	Senior	Notes,	along	with	cash	on	hand	and	proceeds	from	Revolving	Loan	borrowings,	were deposited	with	the	trustee	to	redeem	all	of	the	remaining	$600	million	aggregate	principal	amount	of	the	2022	Senior	Notes	at	a	redemption	price	of	106.182%	of	the principal	amount	redeemed,	plus	accrued	and	unpaid	interest	through	the	date	of	redemption.	The	redemption	date	was	April	2,	2017.	On	the	same	date,	the	indenture governing	the	2022	Senior	Notes	was	satisfied	and	discharged.	In	connection	with	this	redemption,	we	recorded	a	loss	on	extinguishment	of	long-term	debt	of	$43 million	in	the	Consolidated	Statement	of	Operations	for	2017.	This	loss	represents	$37	million	in	redemption	premium	and	$6	million	for	the	write-off	of	the	remaining deferred	financing	costs	related	to	the	2022	Senior	Notes.

On	February	28,	2017,	we	amended	the	Term	Loan	to	reprice	the	facility,	reducing	interest	rate	margins	by	25	basis	points.	The	Term	Loan	replaced	the	prior senior	secured	term	loan	facility	(the	"Prior	Term	Loan	Facility")	that	had	an	outstanding	aggregate	principal	amount	of	$1.5	billion.	We	are	required	to	pay	quarterly principal	installments	equal	to	0.25%	of	the	original	principal	amount	of	the	Prior	Term	Loan	Facility,	with	the	remaining	principal	amount	payable	on	the	maturity	date of	August	17,	2023,	which	was	retained	from	the	Prior	Term	Loan	Facility.	In	connection	with	this	refinancing,	we	recorded	a	loss	on	extinguishment	of	long-term	debt of	$14	million	in	the	Consolidated	Statement	of	Operations	for	the	year	ended	December	31,	2017.	This	loss	represented	the	write-off	of	a	portion	of	the	unamortized deferred	financing	costs	of	$5	million	and	unamortized	discount	related	to	the	Prior	Term	Loan	Facility	of	$9	million.	In	connection	with	the	issuance	of	the	Term	Loan, we	incurred	and	recorded	$2	million	in	deferred	financing	fees,	which	are	recorded	as	a	reduction	to	the	debt	as	of	December	31,	2017.

# Refer	to	Note	10	(Long-Term	Debt)	for	additional	information.

# Share	Repurchase	Program

During	2017,	we	repurchased	9	million	shares	of	our	common	stock	for	$534	million	under	the	previously	announced	$750	million	share	repurchase	program. On	August	3,	2017,	we	announced	that	our	Board	of	Directors	authorized	a	$750	million	increase	to	our	share	repurchase	program	under	which	we	may	repurchase shares	of	our	common	stock	in	the	open	market	or	through	privately	negotiated	or	other	transactions,	depending	on	share	price,	market	conditions	and	other	factors.	As of

December	31,	2017,	we	have	$858	million	remaining	under	this	program.	For	more	information	on	our	share	repurchase	program,	see	Item	5,	"Market	for	Registrant's Common	Equity,	Related	Stockholder	Matters	and	Issuer	Purchases	of	Equity	Securities."

Refer	to	Note	12	(Stockholders'	Equity)	for	additional	information.

A	summary	of	2017	dividend	activity	for	our	common	stock	is	as	follows:

| Dividend	Amount | Declaration	Date | Record	Date | Payment	Date |
| :--- | :--- | :--- | :--- |
| $0.160 | February\t7,\t2017 | February\t24,\t2017 | March\t10,\t2017 |
| $0.160 | May\t3,\t2017 | May\t25,\t2017 | June\t12,\t2017 |
| $0.160 | August\t3,\t2017 | August\t25,\t2017 | September\t11,\t2017 |
| $0.210 | November\t1,\t2017 | November\t24,\t2017 | December\t11,\t2017 |

The	payment	of	any	future	dividends	will	be	at	the	discretion	of	our	Board	of	Directors	and	will	depend	upon	our	results	of	operations,	financial	condition, business	prospects,	capital	requirements,	contractual	restrictions,	any	potential	indebtedness	we	may	incur,	restrictions	imposed	by	applicable	law,	tax	considerations	and other	factors	that	our	Board	of	Directors	deems	relevant.	In	addition,	our	ability	to	pay	dividends	on	our	common	stock	will	be	limited	by	restrictions	on	our	ability	to pay	dividends	or	make	distributions	to	our	stockholders	and	on	the	ability	of	our	subsidiaries	to	pay	dividends	or	make	distributions	to	us,	in	each	case,	under	the	terms of	our	current	and	any	future	agreements	governing	our	indebtedness.

# Cash	Flows

Cash	flows	from	operating,	investing	and	financing	activities	are	as	follows:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Net\tcash\tprovided\tby\t(used\tin): |  |  |  |
| Operating\tactivities | $777.7 | $604.0 | $277.5 |
| Investing\tactivities | (81.1) | (65.9) | (354.4) |
| Net\tchange\tin\taccounts\tpayable\t-\tinventory\tfinancing | (84.0) | 143.6 | 95.9 |
| Other\tfinancing\tactivities | (734.7) | (448.2) | (322.4) |
| Financing\tactivities | (818.7) | (304.6) | (226.5) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 2.6 | (7.4) | (3.5) |
| Net\t(decrease)\tincrease\tin\tcash\tand\tcash\tequivalents | $(119.5) | $226.1 | $(306.9) |

# Operating	Activities

Cash	flows	from	operating	activities	are	as	follows:

| (in	millions) | 2017 | 2016 | Dollar	Change |
| :--- | :--- | :--- | :--- |
| Net\tincome | $523.0 | $424.4 | $98.6 |
| Adjustments\tfor\tthe\timpact\tof\tnon-cash\titems(1) | 194.4 | 202.9 | (8.5) |
| Net\tincome\tadjusted\tfor\tthe\timpact\tof\tnon-cash\titems(2) | 717.4 | 627.3 | 90.1 |
| Changes\tin\tassets\tand\tliabilities: |  |  |  |
| Accounts\treceivable(3) | (128.4) | (179.9) | 51.5 |
| Merchandise\tinventory(4) | 8.5 | (68.5) | 77.0 |
| Accounts\tpayable-trade | 231.5 | 225.1 | 6.4 |
| Other(5) | (51.3) | — | (51.3) |
| Net\tcash\tprovided\tby\toperating\tactivities | $777.7 | $604.0 | $173.7 |

(1) Includes	items	such	as	Deferred	income	taxes,	Depreciation	and	amortization,	Equity-based	compensation	expense	and	Net	loss	on	extinguishments	of	long- term	debt.

(2) The	change	is	primarily	due	to	stronger	operating	results	driven	by	Net	sales	and	Gross	profit	growth	and	excess	tax	benefits	recognized	related	to	equity-based compensation.

(3) The	change	in	Accounts	receivable	was	primarily	due	to	the	timing	of	sales	compared	to	the	same	period	in 2016.

(4) The	change	in	Merchandise	inventory	was	primarily	due	to	higher	inventory	levels	in	2016	compared	to	2015	as	a	result	of	the	timing	of	inventory	shipments	to customers,	increased	returns	and	higher	bill-and-hold	orders.

(5) The	change	in	Other	is	driven	by	an	increase	in	the	receivables	from	vendors	due	to	the	growth	in	business	and	the	settlement	of	our	Restricted	Debt	Unit	Plan liability,	partially	offset	by	an	increase	in	accrued	marketing	expenses.

| (in	millions) | 2016 | 2015 | Dollar	Change |
| :--- | :--- | :--- | :--- |
| Net\tincome | $424.4 | $403.1 | $21.3 |
| Adjustments\tfor\tthe\timpact\tof\tnon-cash\titems(1) | 202.9 | 150.3 | 52.6 |
| Net\tincome\tadjusted\tfor\tthe\timpact\tof\tnon-cash\titems(2) | 627.3 | 553.4 | 73.9 |
| Changes\tin\tassets\tand\tliabilities: |  |  |  |
| Accounts\treceivable(3) | (179.9) | (342.6) | 162.7 |
| Merchandise\tinventory | (68.5) | (31.5) | (37.0) |
| Accounts\tpayable-trade(4) | 225.1 | 100.5 | 124.6 |
| Other | — | (2.3) | 2.3 |
| Net\tcash\tprovided\tby\toperating\tactivities | $604.0 | $277.5 | $326.5 |

(1) Includes	items	such	as	Deferred	income	taxes,	Depreciation	and	amortization,	Equity-based	compensation	expense,	Gain	on	remeasurement	of	equity	method investment,	Loss	from	equity	method	investment	and	net	loss	on	extinguishments	of	long-term	debt.

(2) The	change	in	cash	flows	reflected	stronger	operating	results	driven	by	Net	sales	growth	and	the	impact	of	consolidating	a	full	year	of	CDW	UK	financial results	in	2016,	compared	to	five	months	in	2015.

(3) The	change	in	cash	flows	was	primarily	due	to	an	increase	in	collections	during	2016	due	to	the	higher	accounts	receivable	balance	as	of	December	31,	2015 driven	by	higher	sales	in	our	Public	segment	where	customers	generally	take	longer	to	pay	than	customers	in	our	Corporate	and	Small	Business	segments.	In addition,	the	lower	accounts	receivable	balances	as	of	December	31,	2014,	driven	by	early	payments	from	certain	customers,	resulted	in	lower	cash	flows	in	the prior	year	period.

(4) The	increase	in	cash	flows	was	primarily	due	to	the	timing	of	inventory	purchases	and	longer	payment	terms	with	certain vendors.

In	order	to	manage	our	working	capital	and	operating	cash	needs,	we	monitor	our	cash	conversion	cycle,	defined	as	days	of	sales	outstanding	in	accounts receivable	plus	days	of	supply	in	inventory	minus	days	of	purchases	outstanding	in	accounts	payable,	based	on	a	rolling	three-month	average.	Components	of	our	cash conversion	cycle	are	as	follows:

| (in	days) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Days\tof\tsales\toutstanding\t(DSO)(1) | 52 | 51 | 48 |
| Days\tof\tsupply\tin\tinventory\t(DIO)(2) | 12 | 12 | 13 |
| Days\tof\tpurchases\toutstanding\t(DPO)(3) | (45) | (44) | (40) |
| Cash\tconversion\tcycle | 19 | 19 | 21 |

(1) Represents	the	rolling	three-month	average	of	the	balance	of	Accounts	receivable,	net	at	the	end	of	the	period,	divided	by	average	daily	Net	sales	for	the	same three-month	period.	Also	incorporates	components	of	other	miscellaneous	receivables.

(2) Represents	the	rolling	three-month	average	of	the	balance	of	Merchandise	inventory	at	the	end	of	the	period	divided	by	average	daily	Cost	of	sales	for	the	same three-month	period.

(3) Represents	the	rolling	three-month	average	of	the	combined	balance	of	Accounts	payable-trade,	excluding	cash	overdrafts,	and	Accounts	payable-inventory financing	at	the	end	of	the	period	divided	by	average	daily	Cost	of	sales	for	the	same	three-month	period.

The	cash	conversion	cycle	was	19	days	at	December	31,	2017	and	2016.	The	increase	in	DSO	was	primarily	driven	by	higher	Net	sales	and	related	Accounts receivable	for	third-party	services	such	as	SaaS,	software	assurance	and	warranties.	These	services	have	an	unfavorable	impact	on	DSO	as	the	receivable	is	recognized on	the	Consolidated	Balance	Sheet	on	a	gross	basis	while	the	corresponding	sales	amount	in	the	Consolidated	Statement	of	Operations	is	recorded	on	a	net	basis.	This also	results	in	a	favorable	impact	on	DPO	as	the	payable	is	recognized	on	the	Consolidated	Balance	Sheet	without	a	corresponding	Cost	of	sales	in	the	Statement	of Operations	because	the	cost	paid	to	the	vendor	or	third-party	service	provider	is	recorded	as	a	reduction	to	Net	sales.	In	addition,	DPO	also	increased	due	to	the	mix	of payables	with	certain	vendors	that	have	longer	payment	terms.

The	cash	conversion	cycle	was	19	and	21	days	at	December	31,	2016	and	2015,	respectively.	The	increase	in	DSO	was	primarily	driven	by	higher	Net	sales	and related	Accounts	receivable	for	third-party	services	such	as	SaaS,	software	assurance	and	warranties.	These	services	have	an	unfavorable	impact	on	DSO	as	the receivable	is	recognized	on	the	balance	sheet	on	a	gross	basis	while	the	corresponding	sales	amount	in	the	Statement	of	Operations	is	recorded	on	a	net	basis.	These services	have	a	favorable	impact	on	DPO	as	the	payable	is	recognized	on	the	balance	sheet	without	a	corresponding	cost	of	sale	in	the	Statement	of	Operations	because the	cost	paid	to	the	vendor	or	third-party	service	provider	is	recorded	as	a	reduction	to	Net	sales.	In	addition	to	the	impact	of	these	services	on	DPO,	DPO	also	increased due	to	the	mix	of	payables	with	certain	vendors	that	have	longer	payment	terms.

# Investing	Activities

Net	cash	used	in	investing	activities	increased	$15	million	 in	2017	compared	to	2016.	Capital	expenditures	increased	$17	million to	$81	million from	$64 million	for	2017	and	2016,	respectively,	primarily	related	to	improvements	to	our	information	technology	systems.

Net	cash	used	in	investing	activities	decreased	$289	million	in	2016	compared	to	2015.	The	decrease	in	cash	used	was	primarily	due	to	the	completion	of	the acquisition	of	CDW	UK	in	2015.	Additionally,	capital	expenditures	decreased	$26	million	to	$64	million	from	$90	million	for	2016	and	2015,	respectively,	primarily due	to	spending	for	our	new	office	location	in	2015.

# Financing	Activities

Net	cash	used	in	financing	activities	increased	$514	million	in	2017	compared	to	2016.	The	increase	was	primarily	driven	by	changes	in	accounts	payable- inventory	financing,	which	resulted	in	an	increase	in	cash	used	for	financing	activities	of	$228	million	and	by	share	repurchases	during	2017,	which	resulted	in	an increase	in	cash	used	for	financing	activities	of	$167	million.	For	more	information	on	our	share	repurchase	program,	see	Part	II,	Item	5,	"Market	for	Registrant's Common	Equity,	Related	Stockholder	Matters	and	Issuer	Purchases	of	Equity	Securities."	The	increase	in	cash	used	for	Accounts	payable-inventory	financing	was primarily	driven	by	the	termination	of	one	of	our	inventory	financing	agreements	in	the	fourth	quarter	of	2016,	with	amounts

owed	subsequently	reported	as	Accounts	payable	-	trade	on	the	Consolidated	Balance	Sheet,	which	reduced	cash	flows	reported	as	financing	activities	during	2017.	In addition,	an	increase	in	incentive	compensation	plan	tax	withholdings	paid	of	$50	million,	coupled	with	an	increase	in	dividends	paid	of	$28	million,	contributed	to	the increase	in	cash	used	in	financing	activities.

Net	cash	used	in	financing	activities	increased	$78	million	in	2016	compared	to	2015.	The	increase	was	primarily	driven	by	higher	share	repurchases	during	the year	ended	December	31,	2016,	which	resulted	in	an	increase	in	cash	used	for	financing	activities	of	$126	million.	The	increase	was	partially	offset	by	the	changes	in accounts	payable-inventory	financing,	which	resulted	in	an	increase	in	cash	provided	for	financing	activities	of	$48	million.	The	increase	in	cash	provided	by	accounts payable-inventory	financing	was	primarily	due	to	a	new	vendor	added	to	our	previously	existing	inventory	financing	agreement.	For	a	description	of	the	inventory financing	 transactions	 impacting	 each	 period,	 see	 Note	 7	 (Inventory	 Financing	Agreements)	 to	 the	 accompanying	 Consolidated	 Financial	 Statements.	 For	 more information	on	our	share	repurchase	program,	see	Item	5,	"Market	for	Registrant's	Common	Equity,	Related	Stockholder	Matters	and	Issuer	Purchases	of	Equity Securities."

# Long-Term	Debt	and	Financing	Arrangements

As	 of	December	31,	2017,	we	had	total	indebtedness	of	$3.2	billion,	of	which	$1.5	billion	was	secured	 indebtedness.	At	December	31,	2017,	we	were	in compliance	with	the	covenants	under	our	various	credit	agreements	and	indentures.	The	amount	of	CDW's	restricted	payment	capacity	under	the	Senior	Secured	Term Loan	Facility	was	$1.2	billion	at	December	31,	2017.	The	amount	of	restricted	payment	capacity	for	the	CDW	UK	Term	Loan	was	$98	million.

For	additional	details	regarding	our	debt	and	refinancing	activities,	refer	to	Note	10	(Long-Term	Debt)	to	the	accompanying	Consolidated	Financial	Statements.

# Inventory	Financing	Agreements

We	have	entered	into	agreements	with	certain	financial	intermediaries	to	facilitate	the	purchase	of	inventory	from	various	suppliers	under	certain	terms	and conditions.	These	amounts	are	classified	separately	as	Accounts	payable-inventory	financing	on	the	Consolidated	Balance	Sheets.	We	do	not	incur	any	interest	expense associated	with	these	agreements	as	balances	are	paid	when	they	are	due.	For	further	details,	see	Note	7	(Inventory	Financing	Agreements)	to	the	accompanying Consolidated	Financial	Statements.

# Contractual	Obligations

We	have	future	obligations	under	various	contracts	relating	to	debt	and	interest	payments,	operating	leases	and	payment	obligations	under	the	Tax	Cuts	and Jobs	Act.	Our	estimated	future	payments,	based	on	undiscounted	amounts,	under	these	obligations	that	existed	as	of	December	31,	2017,	are	as	follows:

| (in	millions) | Total | 2018 | 2019-2020 | 2021-2022 | 2023	&amp;	Thereafter |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Term\tLoan(1) | $1,762.7 | $66.1 | $136.4 | $134.2 | $1,426.0 |
| CDW\tUK\tTerm\tLoan(1) | 80.3 | 8.2 | 16.0 | 56.1 | — |
| Senior\tNotes\tdue\t2023(2) | 682.5 | 26.3 | 52.5 | 52.5 | 551.2 |
| Senior\tNotes\tdue\t2024(2) | 796.4 | 31.6 | 63.3 | 63.3 | 638.2 |
| Senior\tNotes\tdue\t2025(2) | 840.0 | 30.0 | 60.0 | 60.0 | 690.0 |
| Operating\tleases(3) | 131.8 | 22.1 | 42.8 | 23.5 | 43.4 |
| Mandatory\trepatriation\ttax(4) | 20.3 | 1.6 | 3.2 | 3.2 | 12.3 |
| Total | $4,314.0 | $185.9 | $374.2 | $392.8 | $3,361.1 |

(1) Includes	future	principal	and	cash	interest	payments	on	long-term	borrowings	through	scheduled	maturity	dates.	Interest	payments	for	variable	rate	debt	were calculated	 using	 interest	 rates	 as	 of	December	31,	2017.	Excluded	from	 these	amounts	are	 the	amortization	of	debt	 issuance	and	other	costs	related	 to indebtedness.

(2) Includes	future	principal	and	cash	interest	payments	on	long-term	borrowings	through	scheduled	maturity	dates.	Interest	on	the	Senior	Notes	is	calculated	using the	stated	interest	rates.	Excluded	from	these	amounts	are	the	amortization	of	debt	issuance	and	other	costs	related	to	indebtedness.

(3) Includes	the	minimum	lease	payments	for	non-cancelable	operating	leases	of	properties	and	equipment	used	in	our	operations.	Capital	leases	included	in property	and	equipment	are	not	material.

(4) Represents	future	cash	tax	payments	for	the	deemed	mandatory	repatriation	of	our	international	operations	unremitted	earnings,	as	required	by	the	Tax	Cuts	and Jobs	Act.

# Off-Balance	Sheet	Arrangements

We	have	no	off-balance	sheet	arrangements	that	have	or	are	reasonably	likely	to	have	a	material	current	or	future	effect	on	our	financial	condition,	changes	in financial	condition,	revenues	or	expenses,	results	of	operations,	liquidity,	capital	expenditures	or	capital	resources.

# Inflation

Inflation	has	not	had	a	material	impact	on	our	operating	results.	We	generally	have	been	able	to	pass	along	price	increases	to	our	customers,	though	certain economic	factors	and	technological	advances	in	recent	years	have	tended	to	place	downward	pressure	on	pricing.	We	also	have	been	able	to	generally	offset	the	effects of	inflation	on	operating	costs	by	continuing	to	emphasize	productivity	improvements	and	by	accelerating	our	overall	cash	conversion	cycle.	There	can	be	no	assurances, however,	that	inflation	would	not	have	a	material	impact	on	our	sales	or	operating	costs	in	the	future.

# Commitments	and	Contingencies

The	information	set	forth	in	Note	16	(Commitments	and	Contingencies)	to	the	accompanying	Consolidated	Financial	Statements	included	in	Part	II,	Item	8	of this	Form	10-K	is	incorporated	herein	by	reference.

# Critical	Accounting	Policies	and	Estimates

The	preparation	of	the	Consolidated	Financial	Statements	in	accordance	with	GAAP	requires	management	to	make	use	of	certain	estimates	and	assumptions that	affect	the	reported	amounts	of	assets	and	liabilities	and	disclosure	of	contingent	assets	and	liabilities	at	the	date	of	the	Consolidated	Financial	Statements	and	the reported	amounts	of	revenue	and	expenses	during	the	reported	periods.	We	base	our	estimates	on	historical	experience	and	on	various	other	assumptions	that	we	believe are	reasonable	under	the	circumstances,	the	results	of	which	form	the	basis	for	making	judgments	about	carrying	values	of	assets	and	liabilities	that	are	not	readily apparent	from	other	sources.	These	estimates	have	not	historically	required	significant	management	judgment.	Our	actual	results	have	not	differed	materially	from	our estimates,	nor	have	we	historically	made	significant	changes	to	the	methods	for	determining	these	estimates.	We	do	not	believe	it	is	reasonably	likely	that	the	estimates and	related	assumptions	will	change	materially	in	the	foreseeable	future	however	actual	results	could	differ	from	those	estimates.

In	Note	1	(Description	of	Business	and	Summary	of	Significant	Accounting	Policies)	to	the	accompanying	Consolidated	Financial	Statements,	we	include	a discussion	of	the	significant	accounting	policies	used	in	the	preparation	of	our	Consolidated	Financial	Statements.	We	believe	the	following	are	the	most	critical accounting	policies	and	estimates	that	include	significant	judgments	used	in	the	preparation	of	the	Consolidated	Financial	Statements.	We	consider	an	accounting	policy or	estimate	to	be	critical	if	it	requires	assumptions	to	be	made	that	were	uncertain	at	the	time	they	were	made,	and	if	changes	in	these	assumptions	could	have	a	material impact	on	our	financial	condition	or	results	of	operations.

# Revenue	Recognition

We	are	a	primary	distribution	channel	for	a	large	group	of	vendors	and	suppliers,	including	OEMs,	software	publishers	and	wholesale	distributors.	We	record revenue	from	sales	transactions	when	title	and	risk	of	loss	are	passed	to	our	customer,	there	is	persuasive	evidence	of	an	arrangement	for	sale,	delivery	has	occurred and/or	services	have	been	rendered,	the	sales	price	is	fixed	or	determinable,	and	collectability	is	reasonably	assured.	Our	shipping	terms	typically	specify	F.O.B. destination,	at	which	time	title	and	risk	of	loss	have	passed	to	the	customer.

Revenues	from	the	sales	of	hardware	products	and	software	products	and	licenses	are	generally	recognized	on	a	gross	basis	with	the	selling	price	to	the customer	recorded	as	sales	and	the	acquisition	cost	of	the	product	recorded	as	cost	of	sales.	These	items	can	be	delivered	to	customers	in	a	variety	of	ways,	including	(i) as	physical	product	shipped	from	our	warehouse,	(ii)	via	drop-shipment	by	the	vendor	or	supplier,	or	(iii)	via	electronic	delivery	for	software	licenses.	At	the	time	of sale,	we	record	an	estimate	for	sales	returns	and	allowances	based	on	historical	experience.	Our	vendor	partners	warrant	most	of	the	products	we	sell.

We	leverage	drop-shipment	arrangements	with	many	of	our	vendors	and	suppliers	to	deliver	products	to	our	customers	without	having	to	physically	hold	the inventory	at	our	warehouses,	thereby	increasing	efficiency	and	reducing	costs.	We	recognize	revenue	for	drop-shipment	arrangements	on	a	gross	basis	upon	delivery	to the	customer	with	contract	terms	that	typically	specify	F.O.B.	destination.	We	recognize	revenue	on	a	gross	basis	as	the	principal	in	the	transaction	because	we	are	the primary	obligor	in	the	arrangement,	we	assume	inventory	risk	if	the	product	is	returned	by	the	customer,	we	set	the	price	of	the	product	charged	to	the	customer,	we assume	credit	risk	for	the	amounts	invoiced,	and	we	work	closely	with	our	customers	to	determine	their

hardware	and	software	specifications.	These	arrangements	represent	approximately	50%	of	total	Net	sales,	of	which	approximately	25%	relate	to	electronic	delivery	for software	licenses.

Revenue	from	professional	services	is	recognized	in	either	of	two	ways:	services	as	an	hourly	rate	(recognized	using	a	percentage	of	completion	model)	or	a fixed	fee	(recognized	using	a	proportional	performance	model	for	the	fixed	fee).	Revenues	for	cloud	computing	solutions	including	SaaS	and	IaaS	arrangements	with one	time	invoicing	to	the	customer	are	recognized	at	the	time	of	invoice.	Revenues	for	data	center	services	such	as	managed	and	remote	managed	services,	server	co- location,	internet	connectivity,	data	backup	and	storage,	and	SaaS	and	IaaS	arrangements	where	the	customer	is	invoiced	over	time	are	recognized	over	the	period	service is	provided.

We	also	sell	certain	products	for	which	we	act	as	an	agent.	Products	in	this	category	include	the	sale	of	third-party	services,	warranties,	software	assurance ("SA")	and	third-party	hosted	SaaS	and	IaaS	arrangements.	SA	is	a	product	that	allows	customers	to	upgrade,	at	no	additional	cost,	to	the	latest	technology	if	new applications	are	introduced	during	the	period	that	the	SA	is	in	effect.	These	sales	do	not	meet	the	criteria	for	gross	sales	recognition,	and	thus	are	recognized	on	a	net basis	at	the	time	of	sale.	Under	Net	sales	recognition,	the	cost	paid	to	the	vendor	or	third-party	service	provider	is	recorded	as	a	reduction	to	sales,	resulting	in	Net	sales being	equal	to	the	Gross	profit	on	the	transaction.

Our	larger	customers	are	offered	the	opportunity	by	certain	of	our	vendors	to	purchase	software	licenses	and	SA	under	enterprise	agreements	("EAs").	Under EAs,	customers	are	considered	to	be	compliant	with	applicable	license	requirements	for	the	ensuing	year,	regardless	of	changes	to	their	employee	base.	Customers	are charged	an	annual	true-up	fee	for	changes	in	the	number	of	users	over	the	year.	With	most	EAs,	our	vendors	will	transfer	the	license	and	bill	the	customer	directly, paying	resellers	such	as	us	an	agency	fee	or	commission	on	these	sales.	We	record	these	fees	as	a	component	of	Net	sales	as	earned	and	there	is	no	corresponding	cost	of sales	amount.	In	certain	instances,	we	bill	the	customer	directly	under	an	EA	and	account	for	the	individual	items	sold	based	on	the	nature	of	the	item.	Our	vendors typically	dictate	how	the	EA	will	be	sold	to	the	customer.

We	also	sell	some	of	our	products	and	services	as	part	of	bundled	contract	arrangements	containing	multiple	deliverables,	which	may	include	a	combination	of the	products	and	services.	For	each	deliverable	that	represents	a	separate	unit	of	accounting,	total	arrangement	consideration	is	allocated	based	upon	the	relative	selling prices	 of	 each	 element.	The	 allocated	 arrangement	 consideration	 is	 recognized	 as	 revenue	 in	 accordance	 with	 the	 principles	 described	 above.	 Selling	 prices	 are determined	by	using	vendor	specific	objective	evidence	("VSOE")	if	it	exists.	Otherwise,	selling	prices	are	determined	using	third	party	evidence	("TPE").	If	neither VSOE	or	TPE	is	available,	we	use	our	best	estimate	of	selling	prices.

We	record	freight	billed	to	our	customers	as	Net	sales	and	the	related	freight	costs	as	a	Cost	of	sales.

Deferred	revenue	includes	(1)	payments	received	from	customers	in	advance	of	providing	the	product	or	performing	services,	and	(2)	amounts	deferred	if	other conditions	of	revenue	recognition	have	not	been	met.

We	perform	an	analysis	of	the	estimated	number	of	days	of	sales	in-transit	to	customers	at	the	end	of	each	period	based	on	a	weighted-average	analysis	of commercial	delivery	terms	that	includes	drop-shipment	arrangements.	This	analysis	is	the	basis	upon	which	we	estimate	the	amount	of	sales	in-transit	at	the	end	of	the period	and	adjust	revenue	and	the	related	costs	to	reflect	only	what	has	been	received	by	the	customer.	Changes	in	delivery	patterns	may	result	in	a	different	number	of business	days	used	in	making	this	adjustment	and	could	have	a	material	impact	on	our	revenue	recognition	for	the	period.

# Vendor	Programs

We	receive	incentives	from	certain	of	our	vendors	related	to	cooperative	advertising	allowances,	volume	rebates,	bid	programs,	price	protection	and	other programs.	These	incentives	generally	relate	to	written	agreements	with	specified	performance	requirements	with	the	vendors	and	are	recorded	as	adjustments	to	cost	of sales	or	inventory,	depending	on	the	nature	of	the	incentive.	Vendors	may	change	the	terms	of	some	or	all	of	these	programs,	which	could	have	an	impact	on	our	results of	operations.

We	record	receivables	from	vendors	related	to	these	programs	when	the	amounts	are	probable	and	reasonably	estimable.	Some	programs	are	based	on	the achievement	of	specific	targets,	and	we	base	our	estimates	on	information	provided	by	our	vendors	and	internal	information	to	assess	our	progress	toward	achieving those	targets.	If	actual	performance	does	not	match	our	estimates,	we	may	be	required	to	adjust	our	receivables.	We	record	reserves	for	vendor	receivables	for	estimated losses	due	to	vendors'	inability	to	pay	or	rejections	by	vendors	of	claims;	however,	if	actual	collections	differ	from	our	estimates,	we	may	incur	additional	losses	that could	have	a	material	impact	on	Gross	profit	and	Income	from	operations.

# Goodwill

Goodwill	is	not	amortized	but	is	subject	to	periodic	testing	for	impairment	at	the	reporting	unit	level.	We	perform	an	evaluation	of	goodwill,	utilizing	either	a quantitative	or	qualitative	impairment	test.	A	qualitative	assessment	is	performed	on	at	least	an	annual	basis	to	determine	whether	it	is	more	likely	than	not	that	the	fair value	of	a	reporting	unit	is	less	than	its	carrying

value.	We	perform	a	quantitative	impairment	test	for	each	reporting	unit	every	three	years,	or	more	frequently	if	circumstances	indicate	a	potential	impairment.	The annual	test	for	impairment	is	conducted	as	of	December	1.	Our	reporting	units	used	to	assess	potential	goodwill	impairment	are	the	same	as	our	operating	segments.

Under	a	quantitative	assessment,	goodwill	impairment	is	identified	by	comparing	the	fair	value	of	a	reporting	unit	to	its	carrying	amount,	including	goodwill.	If the	carrying	amount	of	a	reporting	unit	exceeds	its	fair	value,	goodwill	is	considered	impaired	and	an	impairment	charge	is	recognized	in	an	amount	equal	to	that	excess, not	to	exceed	the	carrying	amount	of	goodwill.	Fair	value	of	a	reporting	unit	is	determined	by	using	a	weighted	combination	of	an	income	approach	(75%)	and	a	market approach	(25%),	as	this	combination	is	considered	the	most	indicative	of	our	fair	value	in	an	orderly	transaction	between	market	participants.

Under	the	income	approach,	we	determine	fair	value	based	on	estimated	future	cash	flows	of	a	reporting	unit,	discounted	by	an	estimated	weighted-average	cost of	capital,	which	reflects	the	overall	level	of	inherent	risk	of	a	reporting	unit	and	the	rate	of	return	an	outside	investor	would	expect	to	earn.	The	estimated	future	cash flows	of	each	reporting	unit	are	based	on	internally	generated	forecasts	for	the	remainder	of	the	respective	reporting	period	and	the	next	five	years.	We	use	a	range	of 2.0-3.5%	long-term	assumed	consolidated	annual	Net	sales	growth	rate	for	periods	after	the	terminal	year.

Under	the	market	approach,	we	utilize	valuation	multiples	derived	from	publicly	available	information	for	guideline	companies	to	provide	an	indication	of	how much	a	knowledgeable	investor	in	the	marketplace	would	be	willing	to	pay	for	a	company.	The	valuation	multiples	are	applied	to	the	reporting	units.

Determining	the	fair	value	of	a	reporting	unit	is	judgmental	in	nature	and	requires	the	use	of	significant	estimates	and	assumptions,	including	Net	sales	growth rates,	gross	margins,	operating	margins,	discount	rates	and	future	market	conditions,	among	others.	Any	changes	in	the	judgments,	estimates	or	assumptions	used	could produce	significantly	different	results.

Under	a	qualitative	assessment,	the	most	recent	quantitative	assessment	is	the	starting	point	to	determine	if	it	is	more	likely	than	not	that	the	reporting	unit's	fair value	is	less	than	its	carrying	value.	As	part	of	this	qualitative	assessment,	we	assess	relevant	events	and	circumstances	including	macroeconomic	conditions,	industry and	market	conditions,	cost	factors,	overall	financial	performance,	changes	in	share	price	and	entity-specific	events.

# 2017	Impairment	Analysis

We	completed	our	annual	impairment	analysis	as	of	December	1,	2017.	For	the	Corporate,	Small	Business	and	UK	reporting	units,	we	performed	a	qualitative analysis.	We	determined	that	it	was	more-likely-than-not	that	the	individual	fair	values	of	the	Corporate,	Small	Business	and	UK	reporting	units	exceeded	the	individual carrying	values	and	therefore	a	quantitative	impairment	analysis	was	deemed	unnecessary.	Although	uncertainty	regarding	the	impact	of	Brexit	still	exists	in	the	current year,	we	do	not	believe	there	to	be	any	additional	risk	that	would	indicate	the	quantitative	analysis	performed	in	the	prior	year	to	have	different	results.	Therefore	a qualitative	analysis	was	deemed	appropriate	for	the	UK	reporting	unit.	We	performed	a	quantitative	analysis	of	the	Public	and	Canada	reporting	units.	Based	on	the results	of	the	quantitative	analysis,	we	determined	that	the	fair	value	of	the	Public	and	Canada	reporting	units	exceeded	their	carrying	values	by	179%	 and	153%, respectively,	and	no	impairment	existed.	We	identified	that	the	most	sensitive	assumptions	used	in	the	quantitative	analysis	were	Net	sales	growth	and	EBITDA	margin and,	although	we	believe	our	assumptions	are	reasonable	based	on	current	market	conditions,	actual	results	may	vary	significantly	and	could	expose	us	to	impairment charges	in	the	future.

With	the	establishment	of	Small	Business	as	its	own	reporting	unit,	we	performed	a	quantitative	analysis	in	order	to	allocate	Goodwill	between	Corporate	and Small	Business.	Based	on	the	results	of	the	quantitative	analysis	performed	as	of	January	1,	2017,	we	determined	that	the	fair	values	of	Corporate	and	Small	Business reporting	units	exceeded	their	carrying	values	by	227%	and	308%,	respectively,	and	no	impairment	existed.

We	completed	our	annual	impairment	analysis	as	of	December	1,	2016.	For	the	Corporate	(which,	as	of	December	1,	2016,	included	Small	Business),	Public and	Canada	reporting	units,	we	performed	a	qualitative	analysis.	We	determined	that	it	was	more-likely-than-not	that	the	individual	fair	values	of	the	Corporate,	Public and	Canada	reporting	units	exceeded	the	individual	carrying	values	and	therefore	a	quantitative	impairment	analysis	was	deemed	unnecessary.	Due	to	the	substantial uncertainty	regarding	the	impact	of	Brexit,	we	performed	a	quantitative	analysis	of	the	CDW	UK	reporting	unit.	Based	on	the	results	of	the	quantitative	analysis,	we determined	that	the	fair	value	of	the	CDW	UK	reporting	unit	exceeded	its	carrying	value	by	16%	and	no	impairment	existed.	We	identified	that	the	most	sensitive assumptions	used	in	the	quantitative	analysis	were	Net	sales	growth	and	EBITDA	margin	and,	although	we	believe	our	assumptions	are	reasonable	based	on	current market	conditions,	actual	results	may	vary	significantly	and	could	expose	us	to	impairment	charges	in	the	future.

# Intangible	assets

Intangible	assets	 include	customer	relationships,	 trade	names,	 internally	developed	software	and	other	 intangibles.	Intangible	assets	with	finite	 lives	are amortized	on	a	straight-line	basis	over	the	estimated	useful	lives	of	the	assets.	The	cost	of	software	developed	or	obtained	for	internal	use	is	capitalized	and	amortized	on a	straight-line	basis	over	the	estimated	useful	life.	These	intangible	assets	are	reviewed	for	impairment	whenever	events	or	changes	in	circumstances	indicate	that	the carrying	amount	of	such	assets	may	not	be	recoverable.	Determination	of	recoverability	is	based	on	an	estimate	of	undiscounted	future	cash	flows	resulting	from	the	use of	the	asset	and	its	eventual	disposition.	If	the	carrying	amount	of	an	asset	exceeds	its	estimated	future	undiscounted	cash	flows,	an	impairment	loss	is	recorded	for	the excess	of	the	asset's	carrying	amount	over	its	fair	value.	In	addition,	each	quarter,	we	evaluate	whether	events	and	circumstances	warrant	a	revision	to	the	remaining estimated	useful	life	of	each	of	these	intangible	assets.	If	we	were	to	determine	that	a	change	to	the	remaining	estimated	useful	life	of	an	intangible	asset	was	necessary, then	the	remaining	carrying	amount	of	the	intangible	asset	would	be	amortized	prospectively	over	that	revised	remaining	useful	life.

During	the	years	ended	December	31,	2017	and	2016,	we	concluded	our	intangible	assets	with	finite	lives	were	not	impaired	and	no	changes	to	the	remaining useful	lives	were	necessary.

# Income	Taxes

Deferred	income	taxes	are	provided	to	reflect	the	differences	between	the	tax	bases	of	assets	and	liabilities	and	their	reported	amounts	in	the	Consolidated Financial	Statements	using	enacted	tax	rates	in	effect	for	the	year	in	which	the	differences	are	expected	to	reverse.	We	perform	an	evaluation	of	the	realizability	of	our deferred	tax	assets	on	a	quarterly	basis.	This	evaluation	requires	us	to	use	estimates	and	make	assumptions	and	considers	all	positive	and	negative	evidence	and	factors, such	as	the	scheduled	reversal	of	temporary	differences,	the	mix	of	earnings	in	the	jurisdictions	in	which	we	operate,	and	prudent	and	feasible	tax	planning	strategies.

We	account	for	unrecognized	tax	benefits	based	upon	our	assessment	of	whether	a	tax	benefit	is	more	likely	than	not	to	be	sustained	upon	examination	by	tax authorities.	We	report	a	liability	for	unrecognized	tax	benefits	resulting	from	unrecognized	tax	benefits	taken	or	expected	to	be	taken	in	a	tax	return	and	recognize	interest and	penalties,	if	any,	related	to	unrecognized	tax	benefits	in	income	tax	expense.

The	Tax	Cuts	and	Jobs	Act	contains	a	provision	which	subjects	a	US	parent	of	a	foreign	subsidiary	to	current	US	tax	on	its	global	intangible	low-tax	income ("GILTI").	The	GILTI	income	is	eligible	for	a	deduction,	which	lowers	the	effective	tax	rate	to	10.5%	for	taxable	years	2018	through	2025	and	13.125%	after	2025.	As we	continue	to	evaluate	our	accounting	policy	with	respect	to	GILTI,	the	provisional	estimates	were	reported	on	the	basis	that	GILTI	will	be	accounted	for	as	a	period cost	when	incurred.	Accordingly,	we	are	not	providing	deferred	taxes	for	basis	differences	expected	to	reverse	as	GILTI.

# Recent	Accounting	Pronouncements

The	information	set	forth	in	Note	2	(Recent	Accounting	Pronouncements)	to	the	accompanying	Consolidated	Financial	Statements	included	in	Part	II,	Item	8	of this	Form	10-K	is	incorporated	herein	by	reference.

# Subsequent	Events

The	information	set	forth	in	Note	21	(Subsequent	Events)	to	the	accompanying	Consolidated	Financial	Statements	included	in	Part	II,	Item	8	of	this	Form	10-K is	incorporated	herein	by	reference.

# Item	7A.	Quantitative	and	Qualitative	Disclosures	of	Market	Risks

# Interest	Rate	Risk

Our	market	risks	relate	primarily	to	changes	in	interest	rates.	The	interest	rates	on	borrowings	under	our	senior	secured	asset-based	revolving	credit	facility,	our senior	secured	term	loan	facility	and	the	CDW	UK	term	loan	are	floating	and,	therefore,	are	subject	to	fluctuations.	In	order	to	manage	the	risk	associated	with	changes in	interest	rates	on	borrowings	under	our	senior	secured	term	loan	facility,	we	have	entered	into	interest	rate	caps	to	add	stability	to	interest	expense	and	to	manage	our exposure	to	interest	rate	fluctuations.

As	of	December	31,	2017,	we	have	interest	rate	cap	agreements	in	effect	through	December	31,	2018	with	a	combined	notional	amount	of	$1.4	billion	which entitle	us	to	payments	from	the	counterparty	of	the	amount,	if	any,	by	which	three-month	LIBOR	exceeds	1.5%	during	the	agreement	period.

For	additional	details,	see	Note	10	(Long-Term	Debt)	to	the	accompanying	Consolidated	Financial	Statements.

See	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	-	Liquidity	and	Capital	Resources	-	Contractual	Obligations" for	information	on	cash	flows,	interest	rates	and	maturity	dates	of	our	debt	obligations.

# Foreign	Currency	Risk

We	transact	business	in	foreign	currencies	other	than	the	US	dollar,	primarily	the	Canadian	dollar	and	the	British	pound,	which	exposes	us	to	foreign	currency exchange	rate	fluctuations.	Revenue	and	expenses	generated	from	our	international	operations	are	generally	denominated	in	the	local	currencies	of	the	corresponding countries.	The	functional	currency	of	our	 international	operating	subsidiaries	 is	 the	 same	 as	 the	 corresponding	 local	 currency.	 Upon	 consolidation,	 as	 results	 of operations	are	translated,	operating	results	may	differ	from	expectations.	The	direct	effect	of	foreign	currency	fluctuations	on	our	results	of	operations	has	not	been material	as	the	majority	of	our	results	of	operations	are	denominated	in	US	dollars.

# Item	8.	Financial	Statements	and	Supplementary	Data

# Index	to	Consolidated	Financial	Statements

|  | Page |
| :--- | :--- |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm | 57 |
| Consolidated\tBalance\tSheets\tas\tof\tDecember\t31,\t2017\tand\t2016 | 58 |
| Consolidated\tStatements\tof\tOperations\tfor\tthe\tyears\tended\tDecember\t31,\t2017,\t2016\tand\t2015 | 59 |
| Consolidated\tStatements\tof\tComprehensive\tIncome\tfor\tthe\tyears\tended\tDecember\t31,\t2017,\t2016\tand\t2015 | 60 |
| Consolidated\tStatements\tof\tStockholders'\tEquity\tfor\tthe\tyears\tended\tDecember\t31,\t2017,\t2016\tand\t2015 | 61 |
| Consolidated\tStatements\tof\tCash\tFlows\tfor\tthe\tyears\tended\tDecember\t31,\t2017,\t2016\tand\t2015 | 62 |
| Notes\tto\tConsolidated\tFinancial\tStatements | 63 |

# Report	of	Independent	Registered	Public	Accounting	Firm

# To	the	Stockholders	and	Board	of	Directors	of	CDW	Corporation	and	subsidiaries

# Opinion	on	the	Financial	Statements

We	have	audited	the	accompanying	consolidated	balance	sheets	of	CDW	Corporation	and	subsidiaries	(the	Company)	as	of	December	31,	2017	and	2016,	the	related consolidated	statements	of	operations,	comprehensive	income,	stockholders'	equity	and	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2017, and	the	related	notes	and	the	financial	statement	schedule	listed	in	the	Index	at	Item	15	(a)	(2)	(collectively	referred	to	as	the	"consolidated	financial	statements").	In	our opinion,	the	consolidated	financial	statements	present	fairly,	in	all	material	respects,	the	financial	position	of	the	Company	at	December	31,	2017	and	2016,	and	the results	of	its	operations	and	its	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2017,	in	conformity	with	U.S.	generally	accepted	accounting principles.

We	also	have	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States)	(PCAOB),	the	Company's	internal	control over	financial	reporting	as	of	December	31,	2017,	based	on	criteria	established	in	Internal	Control-Integrated	Framework	issued	by	the	Committee	of	Sponsoring Organizations	of	the	Treadway	Commission	(2013	framework),	and	our	report	dated	February	28,	2018	expressed	an	unqualified	opinion	thereon.

# Basis	for	Opinion

These	financial	statements	are	the	responsibility	of	the	Company's	management.	Our	responsibility	is	to	express	an	opinion	on	the	Company's	financial	statements	based on	our	audits.	We	are	a	public	accounting	firm	registered	with	the	PCAOB	and	are	required	to	be	independent	with	respect	to	the	Company	in	accordance	with	the	U.S. federal	securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the	PCAOB.

We	conducted	our	audits	in	accordance	with	the	standards	of	the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audit	to	obtain	reasonable	assurance about	whether	the	financial	statements	are	free	of	material	misstatement,	whether	due	to	error	or	fraud.	Our	audits	included	performing	procedures	to	assess	the	risks	of material	misstatement	of	the	financial	statements,	whether	due	to	error	or	fraud,	and	performing	procedures	that	respond	to	those	risks.	Such	procedures	included examining,	on	a	test	basis,	evidence	regarding	the	amounts	and	disclosures	in	the	financial	statements.	Our	audits	also	included	evaluating	the	accounting	principles	used and	significant	estimates	made	by	management,	as	well	as	evaluating	the	overall	presentation	of	the	financial	statements.	We	believe	that	our	audits	provide	a	reasonable basis	for	our	opinion.

# /s/	Ernst	&	Young	LLP

We	have	served	as	the	Company's	auditor	since	2011.

Chicago,	Illinois

# CONSOLIDATED	BALANCE	SHEETS

(in	millions,	except	per-share	amounts)

|  | 2017 | 2016 |
| :--- | :--- | :--- |
| Assets |  |  |
| Current\tassets: |  |  |
| Cash\tand\tcash\tequivalents | $144.2 | $263.7 |
|  | 2,320.5 | 2,168.6 |
| Merchandise\tinventory | 449.5 | 452.0 |
| Miscellaneous\treceivables | 336.5 | 234.9 |
| Prepaid\texpenses\tand\tother | 127.4 | 118.9 |
| Total\tcurrent\tassets | 3,378.1 | 3,238.1 |
| Property\tand\tequipment,\tnet | 161.1 | 163.7 |
| Goodwill | 2,479.6 | 2,455.0 |
| Other\tintangible\tassets,\tnet | 897.0 | 1,055.6 |
| Other\tassets | 40.8 | 36.0 |
| Total\tAssets | $6,956.6 | $6,948.4 |
| Liabilities\tand\tStockholders'\tEquity |  |  |
| Current\tliabilities: |  |  |
| Accounts\tpayable-trade | $1,317.7 | $1,072.9 |
| Accounts\tpayable-inventory\tfinancing | 498.0 | 580.4 |
| Current\tmaturities\tof\tlong-term\tdebt | 25.5 | 18.5 |
| Deferred\trevenue | 194.0 | 172.6 |
| Accrued\texpenses\tand\tother\tcurrent\tliabilities: |  |  |
| Compensation | 129.5 | 167.6 |
| Interest | 21.6 | 25.1 |
| Sales\ttaxes | 43.8 | 38.0 |
| Advertising | 89.2 | 55.8 |
| Income\ttaxes | 15.1 | 2.6 |
| Other | 180.2 | 147.2 |
| Total\tcurrent\tliabilities | 2,514.6 | 2,280.7 |
| Long-term\tliabilities: |  |  |
| Debt | 3,210.0 | 3,215.9 |
| Deferred\tincome\ttaxes | 196.3 | 369.2 |
| Other\tliabilities | 52.8 | 37.1 |
| Total\tlong-term\tliabilities | 3,459.1 | 3,622.2 |
| Stockholders'\tequity: |  |  |
|  | — | — |
|  | 1.5 | 1.6 |
|  | — | — |
|  | 1.5 | 1.6 |
| Paid-in\tcapital | 2,911.6 | 2,857.3 |
| Accumulated\tdeficit | (1,834.3) | (1,673.8) |
| Accumulated\tother\tcomprehensive\tloss | (95.9) | (139.6) |
| Total\tstockholders'\tequity | 982.9 | 1,045.5 |
| Total\tLiabilities\tand\tStockholders'\tEquity | $6,956.6 | $6,948.4 |

The	accompanying	notes	are	an	integral	part	of	the	Consolidated	Financial	Statements.

# CONSOLIDATED	STATEMENTS	OF	OPERATIONS

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Net\tsales | $15,191.5 | $13,981.9 | $12,988.7 |
| Cost\tof\tsales | 12,741.6 | 11,654.7 | 10,872.9 |
| Gross\tprofit | 2,449.9 | 2,327.2 | 2,115.8 |
| Selling\tand\tadministrative\texpenses | 1,410.1 | 1,345.1 | 1,226.0 |
| Advertising\texpense | 173.7 | 162.9 | 147.8 |
| Income\tfrom\toperations | 866.1 | 819.2 | 742.0 |
| Interest\texpense,\tnet | (150.5) | (146.5) | (159.5) |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | (57.4) | (2.1) | (24.3) |
| Gain\ton\tremeasurement\tof\tequity\tinvestment | — | — | 98.1 |
| Other\tincome\t(expense),\tnet | 2.1 | 1.8 | (9.3) |
| Income\tbefore\tincome\ttaxes | 660.3 | 672.4 | 647.0 |
| Income\ttax\texpense | (137.3) | (248.0) | (243.9) |
| Net\tincome | $523.0 | $424.4 | $403.1 |
| Net\tincome\tper\tcommon\tshare: |  |  |  |
| Basic | $3.37 | $2.59 | $2.37 |
| Diluted | $3.31 | $2.56 | $2.35 |
| Weighted-average\tcommon\tshares\toutstanding: |  |  |  |
| Basic | 155.4 | 163.6 | 170.3 |
| Diluted | 158.2 | 166.0 | 171.8 |
| Cash\tdividends\tdeclared\tper\tcommon\tshare | $0.6900 | $0.4825 | $0.3100 |

# CONSOLIDATED	STATEMENTS	OF	COMPREHENSIVE	INCOME

(in	millions)

# CONSOLIDATED	STATEMENTS	OF	STOCKHOLDERS'	EQUITY

|  | Preferred	Stock<br>Shares | Amount | Common	Stock<br>Shares | Amount | Treasury	Stock<br>Shares | Amount | Paid-in<br>Capital | Accumulated<br>Deficit | Accumulated<br>Other<br>Comprehensive	Loss | Total<br>Stockholders'	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tas\tof\nDecember\t31,\t2014 | — | $— | 172.2 | $1.7 | — | $— | $2,711.9 | $(1,760.5) | $(16.6) | $936.5 |
| Equity-based\ncompensation\texpense | — | — | — | — | — | — | 28.3 | — | — | 28.3 |
| Stock\toption\texercises | — | — | 0.1 | — | — | — | 2.4 | — | — | 2.4 |
| Common\tstock\tissued\tfor\nequity-based\tcompensation | — | — | 0.3 | — | — | — | — | — | — | — |
| Excess\ttax\tbenefits\tfrom\nequity-based\tcompensation | — | — | — | — | — | — | 0.6 | — | — | 0.6 |
| Coworker\tStock\tPurchase\nPlan | — | — | 0.3 | — | — | — | 8.7 | — | — | 8.7 |
| Common\tstock\tissued\tfor\nacquisition\tof\tbusiness | — | — | 1.6 | — | — | — | 55.0 | — | — | 55.0 |
| Dividends\tpaid | — | — | — | — | — | — | — | (52.9) | — | (52.9) |
| Net\tincome | — | — | — | — | — | — | — | 403.1 | — | 403.1 |
| Repurchases\tof\tcommon\nstock | — | — | (6.3) | — | — | — | — | (241.3) | — | (241.3) |
| Foreign\tcurrency\ntranslation | — | — | — | — | — | — | — | — | (44.5) | (44.5) |
| Balance\tas\tof\nDecember\t31,\t2015 | — | $— | 168.2 | $1.7 | — | $— | $2,806.9 | $(1,651.6) | $(61.1) | $1,095.9 |
| Equity-based\ncompensation\texpense | — | — | — | — | — | — | 33.2 | — | — | 33.2 |
| Stock\toption\texercises | — | — | 0.4 | — | — | — | 7.4 | — | — | 7.4 |
| Common\tstock\tissued\tfor\nequity-based\tcompensation | — | — | 0.2 | — | — | — | — | — | — | — |
| Coworker\tStock\tPurchase\nPlan | — | — | 0.2 | — | — | — | 9.3 | — | — | 9.3 |
| Dividends\tpaid | — | — | — | — | — | — | 0.5 | (79.2) | — | (78.7) |
| Net\tincome | — | — | — | — | — | — | — | 424.4 | — | 424.4 |
| Repurchases\tof\tcommon\nstock | — | — | (8.7) | (0.1) | — | — | — | (367.4) | — | (367.5) |
| Foreign\tcurrency\ntranslation | — | — | — | — | — | — | — | — | (78.5) | (78.5) |
| Balance\tas\tof\nDecember\t31,\t2016 | — | $— | 160.3 | $1.6 | — | $— | $2,857.3 | $(1,673.8) | $(139.6) | $1,045.5 |
| Equity-based\ncompensation\texpense | — | — | — | — | — | — | 37.9 | — | — | 37.9 |
| Stock\toption\texercises | — | — | 1.5 | — | — | — | 13.0 | — | — | 13.0 |
| Coworker\tStock\tPurchase\nPlan | — | — | 0.2 | — | — | — | 10.3 | — | — | 10.3 |
| Dividends\tpaid | — | — | — | — | — | — | 0.7 | (107.6) | — | (106.9) |
| Incentive\tcompensation |  |  |  |  |  |  |  |  |  |  |
| plan\tshares\twithheld\tfor |  |  |  |  |  |  |  |  |  |  |
| taxes | — | — | — | — | 0.1 | — | (7.6) | (42.0) | — | (49.6) |
| Net\tincome | — | — | — | — | — | — | — | 523.0 | — | 523.0 |
| Repurchases\tof\tcommon\nstock | — | — | (8.9) | (0.1) | — | — | — | (533.9) | — | (534.0) |
| Unrealized\tgain\tfrom\nhedge\taccounting | — | — | — | — | — | — | — | — | 0.2 | 0.2 |
| Foreign\tcurrency\ntranslation | — | — | — | — | — | — | — | — | 43.5 | 43.5 |
| Balance\tas\tof\nDecember\t31,\t2017 | — | $— | 153.1 | $1.5 | 0.1 | $— | $2,911.6 | $(1,834.3) | $(95.9) | $982.9 |

# CONSOLIDATED	STATEMENTS	OF	CASH	FLOWS

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Cash\tflows\tfrom\toperating\tactivities: |  |  |  |
| Net\tincome | $523.0 | $424.4 | $403.1 |
| Adjustments\tto\treconcile\tnet\tincome\tto\tnet\tcash\tprovided\tby\toperating\tactivities: |  |  |  |
| Depreciation\tand\tamortization | 260.9 | 254.5 | 227.4 |
| Equity-based\tcompensation\texpense | 43.7 | 39.2 | 31.2 |
| Deferred\tincome\ttaxes | (172.7) | (97.2) | (54.5) |
| Amortization\tof\tdeferred\tfinancing\tcosts,\tdebt\tpremium\tand\tdebt\tdiscount,\tnet | 5.2 | 6.5 | 6.4 |
| Net\tloss\ton\textinguishments\tof\tlong-term\tdebt | 57.4 | 2.1 | 24.3 |
| Loss\tfrom\tequity\tinvestments | — | — | 11.2 |
| Gain\ton\tremeasurement\tof\tequity\tinvestment | — | — | (98.1) |
| Mark-to-market\t(gain)\tloss\ton\tinterest\trate\tcap\tagreements | (0.5) | (2.6) | 2.1 |
| Other | 0.4 | 0.4 | 0.3 |
| Changes\tin\tassets\tand\tliabilities: |  |  |  |
| Accounts\treceivable | (128.4) | (179.9) | (342.6) |
| Merchandise\tinventory | 8.5 | (68.5) | (31.5) |
| Other\tassets | (116.4) | (50.1) | (71.2) |
| Accounts\tpayable-trade | 231.5 | 225.1 | 100.5 |
| Other\tcurrent\tliabilities | 51.4 | 80.2 | 47.5 |
| Long-term\tliabilities | 13.7 | (30.1) | 21.4 |
| Net\tcash\tprovided\tby\toperating\tactivities | 777.7 | 604.0 | 277.5 |
| Cash\tflows\tused\tin\tinvesting\tactivities: |  |  |  |
| Capital\texpenditures | (81.1) | (63.5) | (90.1) |
| Premium\tpayments\ton\tinterest\trate\tcap\tagreements | — | (2.4) | (0.5) |
| Acquisition\tof\tbusiness,\tnet\tof\tcash\tacquired | — | — | (263.8) |
| Net\tcash\tused\tin\tinvesting\tactivities | (81.1) | (65.9) | (354.4) |
| Cash\tflows\tused\tin\tfinancing\tactivities: |  |  |  |
| Proceeds\tfrom\tborrowings\tunder\trevolving\tcredit\tfacility | 1,560.7 | 338.8 | 314.5 |
| Repayments\tof\tborrowings\tunder\trevolving\tcredit\tfacility | (1,560.7) | (338.8) | (314.5) |
| Repayments\tof\tlong-term\tdebt | (14.9) | (20.6) | (32.8) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt |  |  |  |
|  | 2,083.0 | 1,483.0 | 525.0 |
| Payments\tto\textinguish\tlong-term\tdebt | (2,121.3) | (1,490.4) | (525.3) |
| Net\tchange\tin\tother\tlong-term\tobligation | (3.8) | 15.7 | — |
| Payments\tof\tdebt\tfinancing\tcosts | (9.6) | (5.9) | (6.8) |
| Net\tchange\tin\taccounts\tpayable-inventory\tfinancing | (84.0) | 143.6 | 95.9 |
| Effective\tportion\tof\tinterest\trate\tcap\tagreements | 0.4 | — | — |
| Proceeds\tfrom\tstock\toption\texercises | 13.0 | 7.4 | 2.4 |
| Proceeds\tfrom\tCoworker\tStock\tPurchase\tPlan | 10.3 | 9.3 | 8.7 |
| Repurchases\tof\tcommon\tstock | (534.0) | (367.4) | (241.3) |
| Payment\tof\tincentive\tcompensation\tplan\twithholding\ttaxes | (49.6) | — | 0.6 |
| Dividends | (106.9) | (78.7) | (52.9) |
| Principal\tpayments\tunder\tcapital\tlease\tobligations | (1.3) | (0.6) | — |
| Net\tcash\tused\tin\tfinancing\tactivities | (818.7) | (304.6) | (226.5) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 2.6 | (7.4) | (3.5) |
| Net\t(decrease)\tincrease\tin\tcash\tand\tcash\tequivalents | (119.5) | 226.1 | (306.9) |
| Cash\tand\tcash\tequivalents\t–\tbeginning\tof\tperiod | 263.7 | 37.6 | 344.5 |
| Cash\tand\tcash\tequivalents\t–\tend\tof\tperiod | $144.2 | $263.7 | $37.6 |
| Supplementary\tdisclosure\tof\tcash\tflow\tinformation: |  |  |  |
| Interest\tpaid | $(148.5) | $(144.3) | $(154.6) |
| Taxes\tpaid,\tnet | $(275.7) | $(329.2) | $(300.2) |

# NOTES	TO	CONSOLIDATED	FINANCIAL	STATEMENTS

# 1. Description	of	Business	and	Summary	of	Significant	Accounting	Policies

# Description	of	Business

CDW	Corporation	("Parent")	is	a	Fortune	500	company	with	multi-national	capabilities	and	a	leading	provider	of	integrated	information	technology	("IT") solutions	to	small,	medium	and	large	business,	government,	education	and	healthcare	customers	in	the	United	States	("US"),	the	United	Kingdom	("UK")	and Canada.	The	Company's	offerings	range	from	discrete	hardware	and	software	products	to	integrated	IT	solutions	such	as	mobility,	security,	data	center optimization,	cloud	computing,	virtualization	and	collaboration.

Throughout	this	report,	the	terms	"the	Company"	and	"CDW"	refer	to	Parent	and	its	100%	owned	subsidiaries.

Parent	has	two	100%	owned	subsidiaries,	CDW	LLC	and	CDW	Finance	Corporation.	CDW	LLC	is	an	Illinois	limited	liability	company	that,	together	with	its 100%	owned	subsidiaries,	holds	all	material	assets	and	conducts	all	business	activities	and	operations	of	 the	Company.	CDW	Finance	Corporation	 is	a Delaware	 corporation	 formed	 for	 the	 sole	 purpose	 of	 acting	 as	 co-issuer	 of	 certain	 debt	 obligations	 as	 described	 in	Note	 19	 (Supplemental	 Guarantor Information)	and	does	not	hold	any	material	assets	or	engage	in	any	business	activities	or	operations.

In	August	2015,	the	Company	completed	the	acquisition	of	Kelway	TopCo	Limited	("Kelway"),	a	UK-based	IT	solutions	provider	with	global	offerings	by purchasing	 the	remaining	65%	of	its	outstanding	common	stock,	which	increased	the	Company's	ownership	interest	from	35%	 to	100%	and	provided	the Company	control.	In	2016	Kelway	was	rebranded	CDW	UK.

# Basis	of	Presentation

The	Consolidated	Financial	Statements	have	been	prepared	in	conformity	with	accounting	principles	generally	accepted	in	the	United	States	of	America ("GAAP")	and	the	rules	and	regulations	of	the	US	Securities	and	Exchange	Commission	("SEC").

# Principles	of	Consolidation

The	Consolidated	Financial	Statements	include	the	accounts	of	Parent	and	its	100%	owned	subsidiaries.	All	intercompany	transactions	and	accounts	are eliminated	in	consolidation.

# Use	of	Estimates

The	preparation	of	the	Consolidated	Financial	Statements	in	accordance	with	GAAP	requires	management	to	make	use	of	certain	estimates	and	assumptions that	affect	 the	reported	amounts	of	assets	and	 liabilities	and	disclosure	of	contingent	assets	and	 liabilities	as	of	 the	date	 of	 the	 Consolidated	 Financial Statements	and	the	reported	amounts	of	revenue	and	expenses	during	the	reported	periods.	The	Company	bases	its	estimates	on	historical	experience	and	on various	other	assumptions	that	management	believes	are	reasonable	under	the	circumstances,	the	results	of	which	form	the	basis	for	making	judgments	about carrying	values	of	assets	and	liabilities	that	are	not	readily	apparent	from	other	sources.	Actual	results	could	differ	from	those	estimates.

# Business	Combinations

The	Company	accounts	for	all	business	combinations	using	the	acquisition	method	of	accounting,	which	allocates	the	fair	value	of	the	purchase	consideration	to the	tangible	and	intangible	assets	acquired	and	liabilities	assumed	based	on	their	estimated	fair	values.	The	excess	of	the	purchase	consideration	over	the	fair values	 of	 these	 identifiable	 assets	 and	 liabilities	 is	 recorded	 as	 goodwill.	 When	 determining	 the	 fair	 values	 of	 assets	 acquired	 and	 liabilities	 assumed, management	makes	significant	estimates	and	assumptions.	The	Company	may	utilize	third-party	valuation	specialists	to	assist	the	Company	in	the	allocation. Initial	purchase	price	allocations	are	subject	to	revision	within	the	measurement	period,	not	to	exceed	one	year	from	the	date	of	acquisition.	Acquisition-related expenses	and	transaction	costs	associated	with	business	combinations	are	expensed	as	incurred.

# Cash	and	Cash	Equivalents

Cash	and	cash	equivalents	include	all	deposits	in	banks	and	short-term	(original	maturities	of	three	months	or	less	at	the	time	of	purchase),	highly	liquid investments	that	are	readily	convertible	to	known	amounts	of	cash	and	are	so	near	maturity	that	there	is	insignificant	risk	of	changes	in	value	due	to	interest	rate changes.

# Accounts	Receivable

Trade	accounts	receivable	are	recorded	at	the	invoiced	amount	and	typically	do	not	bear	interest.	The	Company	provides	allowances	for	doubtful	accounts related	 to	 accounts	 receivable	 for	 estimated	 losses	 resulting	 from	 the	 inability	 of	 its	 customers	 to	 make	 required	 payments.	 The	 Company	 takes	 into consideration	the	overall	quality	of	the	receivable	portfolio	along	with	specifically-identified	customer	risks	in	establishing	the	allowance.

# Merchandise	Inventory

Inventory	is	valued	at	the	lower	of	cost	and	net	realizable	value.	Cost	is	determined	using	a	weighted-average	cost	method.	Price	protection	is	recorded	when earned	as	a	reduction	to	the	cost	of	inventory.	The	Company	decreases	the	value	of	inventory	for	estimated	obsolescence	equal	to	the	difference	between	the cost	 of	 inventory	 and	 the	 net	 realizable	 value,	 based	 upon	 an	 aging	 analysis	 of	 the	 inventory	 on	 hand,	 specifically	 known	 inventory-related	 risks,	 and assumptions	about	future	demand	and	market	conditions.

# Miscellaneous	Receivables

Miscellaneous	receivables	primarily	consist	of	amounts	due	from	vendors.	The	Company	receives	incentives	from	vendors	related	to	cooperative	advertising, volume	rebates,	bid	programs,	price	protection	and	other	programs.	These	incentives	generally	relate	to	written	vendor	agreements	with	specified	performance requirements	and	are	recorded	as	adjustments	to	Cost	of	sales	or	Merchandise	inventory,	depending	on	the	nature	of	the	incentive.

# Property	and	Equipment

Property	and	equipment	are	stated	at	cost,	less	accumulated	depreciation.	The	Company	calculates	depreciation	expense	using	the	straight-line	method	over	the estimated	 useful	 lives	 of	 the	 assets.	 Property	 and	 equipment	 are	 reviewed	 annually	 to	 determine	 whether	 there	 is	 any	 impairment.	 Determination	 of recoverability	is	based	on	an	estimate	of	undiscounted	future	cash	flows	resulting	from	the	use	of	the	asset	and	its	eventual	disposition.	If	the	carrying	amount of	an	asset	exceeds	its	estimated	future	undiscounted	cash	flows,	an	impairment	loss	is	recorded	for	the	excess	of	the	asset's	carrying	amount	over	its	fair	value. Leasehold	 improvements	 are	 amortized	 over	 the	 shorter	 of	 their	 estimated	 useful	 lives	 or	 the	 initial	 lease	 term.	 Expenditures	 for	 major	 renewals	 and improvements	that	extend	the	useful	life	of	property	and	equipment	are	capitalized.	Expenditures	for	maintenance	and	repairs	are	charged	to	expense	as incurred.	The	estimated	useful	lives	of	property	and	equipment	are	as	follows:

The	Company	has	asset	retirement	obligations	associated	with	commitments	to	return	property	subject	to	the	terms	of	operating	leases	to	its	original	condition upon	lease	termination.	At	December	31,	2017	and	2016,	the	Company's	asset	retirement	liability	was	less	than	$2	million	and	$1	million,	respectively.

# Equity	Investments

If	the	Company	is	not	required	to	consolidate	its	investment	in	another	entity	because	it	does	not	have	control,	the	Company	uses	the	equity	method	if	it	(i)	can exercise	significant	influence	over	the	other	entity	and	(ii)	holds	common	stock	of	the	other	entity.	Under	the	equity	method,	investments	are	carried	at	cost, plus	or	minus	the	Company's	share	of	equity	in	the	increases	and	decreases	in	the	investee's	net	assets	after	the	date	of	acquisition	and	adjustments	for	basis differences.	The	Company's	share	of	the	income	or	loss	of	equity	method	investees	is	included	in	Other	income	(expense),	net	in	the	Consolidated	Statements of	Operations.

The	Company	performs	an	evaluation	of	goodwill,	utilizing	either	a	qualitative	or	quantitative	impairment	test.	A	qualitative	assessment	is	performed	at	least on	an	annual	basis	to	determine	whether	it	is	more	likely	than	not	that	the	fair	value	of	a	reporting	unit	is	less	than	its	carrying	value.	The	Company	performs	a quantitative	impairment	test	for

each	reporting	unit	every	three	years,	or	more	frequently	if	circumstances	indicate	a	potential	impairment.	The	annual	test	for	impairment	is	conducted	as	of December	1.	The	Company's	reporting	units	included	in	the	assessment	of	potential	goodwill	impairment	are	the	same	as	its	operating	segments.	Goodwill	is not	amortized	but	is	subject	to	periodic	testing	for	impairment	at	the	reporting	unit	level.

Under	a	qualitative	assessment,	the	most	recent	quantitative	assessment	is	used	to	determine	if	it	is	more-	likely-than-not	that	the	reporting	unit's	goodwill	is impaired.	As	part	of	this	qualitative	assessment,	the	Company	assesses	relevant	events	and	circumstances	including	macroeconomic	conditions,	industry	and market	conditions,	cost	factors,	overall	financial	performance,	changes	 in	share	price	and	entity-specific	events	 to	determine	 if	 there	 is	an	 indication	of impairment.

Under	a	quantitative	assessment,	goodwill	impairment	is	identified	by	comparing	the	fair	value	of	a	reporting	unit	to	its	carrying	amount,	including	goodwill.	If the	carrying	amount	of	a	reporting	unit	exceeds	its	fair	value,	goodwill	is	considered	impaired	and	an	impairment	charge	is	recognized	in	an	amount	equal	to that	excess,	not	to	exceed	the	carrying	amount	of	goodwill.	Fair	value	of	a	reporting	unit	is	determined	by	using	a	weighted	combination	of	an	income	approach (75%)	and	a	market	approach	(25%),	as	this	combination	is	considered	the	most	indicative	of	the	Company's	fair	value	in	an	orderly	transaction	between market	participants.

Under	the	income	approach,	the	Company	determines	fair	value	based	on	estimated	future	cash	flows	of	a	reporting	unit,	discounted	by	an	estimated	weighted- average	cost	of	capital,	which	reflects	the	overall	level	of	inherent	risk	of	a	reporting	unit	and	the	rate	of	return	an	outside	investor	would	expect	to	earn.	The estimated	future	cash	flows	of	each	reporting	unit	are	based	on	internally	generated	forecasts	for	the	remainder	of	the	respective	reporting	period	and	the	next five	years.	The	Company	uses	a	range	of	2.0-3.5%	long-term	assumed	consolidated	annual	Net	sales	growth	rate	for	periods	after	the	terminal	year.

Under	the	market	approach,	the	Company	utilizes	valuation	multiples	derived	from	publicly	available	information	for	guideline	companies	to	provide	an indication	of	how	much	a	knowledgeable	investor	in	the	marketplace	would	be	willing	to	pay	for	a	company.	The	valuation	multiples	are	applied	to	the reporting	units.

Determining	the	fair	value	of	a	reporting	unit	is	judgmental	in	nature	and	requires	the	use	of	significant	estimates	and	assumptions,	including	Net	sales	growth rates,	 gross	 profit	 margins,	 operating	 margins,	 discount	 rates	 and	 future	 market	 conditions,	 among	 others.	Any	 changes	 in	 the	 judgments,	 estimates	 or assumptions	used	could	produce	significantly	different	results.

Intangible	assets	with	determinable	lives	are	amortized	on	a	straight-line	basis	over	their	respective	estimated	useful	lives.	The	cost	of	computer	software developed	or	obtained	for	internal	use	is	capitalized	and	amortized	on	a	straight-line	basis	over	the	estimated	useful	life	of	the	software.	Intangible	assets	are reviewed	for	impairment	when	events	or	changes	in	circumstances	indicate	that	the	carrying	amount	of	such	assets	may	not	be	recoverable.	Determination	of recoverability	is	based	on	an	estimate	of	undiscounted	future	cash	flows	resulting	from	the	use	of	the	asset	and	its	eventual	disposition.	If	the	carrying	amount of	an	asset	exceeds	its	estimated	future	undiscounted	cash	flows,	an	impairment	loss	is	recorded	for	the	excess	of	the	asset's	carrying	amount	over	its	fair	value. In	addition,	each	quarter,	the	Company	evaluates	whether	events	and	circumstances	warrant	a	revision	to	the	remaining	estimated	useful	life	of	each	of	these intangible	assets.	If	the	Company	were	to	determine	that	a	change	to	the	remaining	estimated	useful	life	of	an	intangible	asset	was	necessary,	then	the remaining	carrying	amount	of	the	intangible	asset	would	be	amortized	prospectively	over	that	revised	remaining	useful	life.

The	following	table	shows	estimated	useful	lives	of	definite-lived	intangible	assets:

# Deferred	Financing	Costs

Deferred	financing	costs,	such	as	underwriting,	financial	advisory,	professional	fees	and	other	similar	fees	are	capitalized	and	recognized	in	Interest	expense, net	over	the	estimated	life	of	the	related	debt	instrument	using	the	effective	interest

method	or	straight-line	method,	as	applicable.	The	Company	classifies	deferred	financing	costs	as	a	direct	deduction	from	the	carrying	value	of	the	Long-term debt	liability	on	the	Consolidated	Balance	Sheets,	except	for	deferred	financing	costs	associated	with	revolving	credit	facilities	which	are	presented	as	an	asset, within	Other	assets	on	the	Consolidated	Balance	Sheets.

# Derivative	Instruments

The	Company	has	interest	rate	cap	agreements	for	the	purpose	of	hedging	its	exposure	to	fluctuations	in	interest	rates.	The	interest	rate	cap	agreements	are designated	as	cash	flow	hedges	of	interest	rate	risk	and	recorded	at	fair	value	in	Other	assets	on	the	Consolidated	Balance	Sheets.	The	gain	or	loss	on	the derivative	instruments	is	reported	as	a	component	of	Accumulated	other	comprehensive	loss	until	reclassified	to	Interest	expense	in	the	same	period	the	hedge transaction	affects	earnings.

# Fair	Value	Measurements

Fair	value	is	defined	under	GAAP	as	the	price	that	would	be	received	to	sell	an	asset	or	paid	to	transfer	a	liability	in	an	orderly	transaction	between	market participants	at	the	measurement	date.	A	fair	value	hierarchy	has	been	established	for	valuation	inputs	to	prioritize	the	inputs	into	three	levels	based	on	the extent	to	which	inputs	used	in	measuring	fair	value	are	observable	in	the	market.	Each	fair	value	measurement	is	reported	in	one	of	the	three	levels	which	is determined	by	the	lowest	level	input	that	is	significant	to	the	fair	value	measurement	in	its	entirety.	These	levels	are:

Level	1	–	observable	inputs	such	as	quoted	prices	for	identical	instruments	traded	in	active	markets.

Level	2	–	inputs	are	based	on	quoted	prices	for	similar	instruments	in	active	markets,	quoted	prices	for	identical	or	similar	instruments	in	markets	that	are	not active	and	model-based	valuation	techniques	for	which	all	significant	assumptions	are	observable	in	the	market	or	can	be	corroborated	by	observable	market data	for	substantially	the	full	term	of	the	assets	or	liabilities.

Level	3	–	inputs	are	generally	unobservable	and	typically	reflect	management's	estimates	of	assumptions	that	market	participants	would	use	in	pricing	the	asset or	liability.	The	fair	values	are	therefore	determined	using	model-based	techniques	that	include	option	pricing	models,	discounted	cash	flow	models	and	similar techniques.

# Accumulated	Other	Comprehensive	Loss

The	components	of	Accumulated	other	comprehensive	loss	included	in	Stockholders'	equity	are	as	follows:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Foreign\tcurrency\ttranslation | $(96.1) | \t $(139.6) | \t $(61.1) |
| Unrealized\tgain\tfrom\thedge\taccounting | 0.2 | — | — |
| Accumulated\tother\tcomprehensive\tloss | $(95.9) | \t $(139.6) | \t $(61.1) |

The	Company	is	a	primary	distribution	channel	for	a	large	group	of	vendors	and	suppliers,	including	original	equipment	manufacturers	("OEMs"),	software publishers,	wholesale	distributors	and	cloud	providers.	The	Company	records	revenue	from	sales	transactions	when	title	and	risk	of	loss	are	passed	to	the customer,	there	is	persuasive	evidence	of	an	arrangement	for	sale,	delivery	has	occurred	and/or	services	have	been	rendered,	 the	sales	price	 is	fixed	or determinable,	and	collectability	is	reasonably	assured.	The	Company's	shipping	terms	typically	specify	F.O.B.	destination,	at	which	time	title	and	risk	of	loss have	passed	to	the	customer.

Revenues	from	the	sales	of	hardware	products	and	software	licenses	are	generally	recognized	on	a	gross	basis	with	the	selling	price	to	the	customer	recorded	as sales	and	the	acquisition	cost	of	the	product	recorded	as	cost	of	sales.	These	items	can	be	delivered	to	customers	in	a	variety	of	ways,	including	(i)	as	physical product	shipped	from	the	Company's	warehouse,	(ii)	via	drop-shipment	by	the	vendor	or	supplier,	or	(iii)	via	electronic	delivery	for	software	licenses.	At	the time	of	sale,	the	Company	records	an	estimate	for	sales	returns	and	allowances	based	on	historical	experience.	The	Company's	vendor	partners	warrant	most	of the	products	the	Company	sells.

The	Company	leverages	drop-shipment	arrangements	with	many	of	its	vendors	and	suppliers	to	deliver	products	to	its	customers	without	having	to	physically hold	the	inventory	at	its	warehouses,	thereby	increasing	efficiency	and	reducing

costs.	The	Company	recognizes	revenue	for	drop-shipment	arrangements	on	a	gross	basis	upon	delivery	to	the	customer	with	contract	terms	that	typically specify	F.O.B.	destination.

Revenue	from	professional	services	is	either	recognized	as	provided	for	services	billed	at	an	hourly	rate,	recognized	using	a	percentage	of	completion	model	for fixed	fee	project	work	or	recognized	using	a	proportional	performance	model	for	services	provided	at	a	fixed	fee.	Revenues	for	cloud	computing	solutions including	Software	as	a	Service	("SaaS")	and	Infrastructure	as	a	Service	("IaaS")	arrangements	with	one	time	invoicing	to	the	customer	are	recognized	at	the time	of	invoice.	Revenues	for	data	center	services	such	as	managed	and	remote	managed	services,	server	co-location,	internet	connectivity,	data	backup	and storage,	and	SaaS	and	IaaS	arrangements	where	the	customer	is	invoiced	over	time	are	recognized	over	the	period	service	is	provided.

The	Company	also	sells	certain	products	for	which	it	acts	as	an	agent.	Products	in	this	category	include	the	sale	of	third-party	services,	warranties,	software assurance	("SA")	and	third-party	hosted	SaaS	and	IaaS	arrangements.	SA	is	a	product	that	allows	customers	to	upgrade,	at	no	additional	cost,	to	the	latest technology	if	new	applications	are	introduced	during	the	period	that	the	SA	is	in	effect.	These	sales	do	not	meet	the	criteria	for	gross	sales	recognition,	and	thus are	recognized	on	a	net	basis	at	the	time	of	sale.	Under	Net	sales	recognition,	the	cost	paid	to	the	vendor	or	third-party	service	provider	is	recorded	as	a reduction	to	sales,	resulting	in	Net	sales	being	equal	to	the	gross	profit	on	the	transaction.

The	Company's	larger	customers	are	offered	the	opportunity	by	certain	of	its	vendors	to	purchase	software	licenses	and	SA	under	enterprise	agreements ("EAs").	Under	EAs,	customers	are	considered	to	be	compliant	with	applicable	license	requirements	for	the	ensuing	year,	regardless	of	changes	to	their employee	base.	Customers	are	charged	an	annual	true-up	fee	for	changes	in	the	number	of	users	over	the	year.	With	most	EAs,	the	Company's	vendors	will transfer	the	license	and	bill	the	customer	directly,	paying	resellers	such	as	the	Company	an	agency	fee	or	commission	on	these	sales.	The	Company	records these	fees	as	a	component	of	Net	sales	as	earned	and	there	is	no	corresponding	cost	of	sales	amount.	In	certain	instances,	the	Company	bills	the	customer directly	under	an	EA	and	accounts	for	the	individual	items	sold	based	on	the	nature	of	the	item.	The	Company's	vendors	typically	dictate	how	the	EA	will	be sold	to	the	customer.

The	Company	also	sells	some	of	its	products	and	services	as	part	of	bundled	contract	arrangements	containing	multiple	deliverables,	which	may	include	a combination	of	products	and	services.	For	each	deliverable	that	represents	a	separate	unit	of	accounting,	total	arrangement	consideration	is	allocated	based	upon the	relative	selling	prices	of	each	element.	The	allocated	arrangement	consideration	is	recognized	as	revenue	in	accordance	with	the	principles	described	above. Relative	selling	prices	are	determined	by	using	vendor	specific	objective	evidence	("VSOE")	if	it	exists.	Otherwise,	selling	prices	are	determined	using	third- party	evidence	("TPE").	If	neither	VSOE	or	TPE	is	available,	the	Company	uses	its	best	estimate	of	selling	prices.

The	Company	records	freight	billed	to	its	customers	as	Net	sales	and	the	related	freight	costs	as	a	Cost	of	sales.

Deferred	revenue	includes	(i)	payments	received	from	customers	in	advance	of	providing	the	product	or	performing	services	and	(ii)	amounts	deferred	if	other conditions	of	revenue	recognition	have	not	been	met.

The	Company	performs	an	analysis	of	the	estimated	number	of	days	of	sales	in-transit	to	customers	at	the	end	of	each	period	based	on	a	weighted-average analysis	of	commercial	delivery	terms	that	includes	drop-shipment	arrangements.	This	analysis	is	the	basis	upon	which	the	Company	estimates	the	amount	of sales	in-transit	at	the	end	of	the	period	and	adjusts	revenue	and	the	related	costs	to	reflect	only	what	has	been	received	by	the	customer.	Changes	in	delivery patterns	may	result	in	a	different	number	of	business	days	used	in	making	this	adjustment	and	could	have	a	material	impact	on	the	Company's	revenue recognition	for	the	period.

# Sales	Taxes

Sales	 tax	 amounts	 collected	 from	 customers	 for	 remittance to	 governmental	 authorities	 are	 presented	 on	 a	 net	 basis in the	 Consolidated	 Statements	 of Operations.

# Advertising

Advertising	costs	are	generally	charged	to	expense	in	the	period	incurred.	Cooperative	reimbursements	from	vendors	are	recorded	in	the	period	the	related advertising	expenditure	is	incurred.	The	Company	classifies	vendor	consideration	as	a	reduction	to	Cost	of	sales.

# Equity-Based	Compensation

The	Company	measures	all	equity-based	payments	using	a	fair-value-based	method	and	records	compensation	expense	over	the	requisite	service	period	using the	straight-line	method	in	its	Consolidated	Financial	Statements.	Estimated	forfeiture	rates	have	been	developed	based	upon	historical	experience.

# Interest	Expense

Interest	expense	is	recognized	in	the	period	incurred	at	the	applicable	interest	rate	in	effect.

# Foreign	Currency	Translation

The	Company's	functional	currency	is	the	US	dollar.	The	functional	currency	of	the	Company's	international	operating	subsidiaries	is	generally	the	same	as	the corresponding	local	currency.	Assets	and	liabilities	of	the	international	operating	subsidiaries	are	translated	at	the	spot	rate	in	effect	at	the	applicable	reporting date.	Revenues	and	expenses	of	the	international	operating	subsidiaries	are	translated	at	the	average	exchange	rates	in	effect	during	the	applicable	period.	The resulting	 foreign	 currency	 translation	 adjustment	 is	 recorded	 as	Accumulated	 other	 comprehensive	 loss,	 which	 is	 reflected	 as	 a	 separate	 component	 of Stockholders'	equity.

Deferred	income	taxes	are	provided	to	reflect	the	differences	between	the	tax	bases	of	assets	and	liabilities	and	their	reported	amounts	in	the	Consolidated Financial	Statements	using	enacted	tax	rates	in	effect	for	the	year	in	which	the	differences	are	expected	to	reverse.	The	Company	performs	an	evaluation	of	the realizability	of	deferred	tax	assets	on	a	quarterly	basis.	This	evaluation	requires	management	to	make	use	of	estimates	and	assumptions	and	considers	all positive	and	negative	evidence	and	factors,	such	as	the	scheduled	reversal	of	temporary	differences,	the	mix	of	earnings	in	the	jurisdictions	in	which	the Company	operates,	and	prudent	and	feasible	tax	planning	strategies.

The	Company	accounts	for	unrecognized	 tax	benefits	based	upon	 its	assessment	of	whether	a	 tax	benefit	 is	more	 likely	 than	not	 to	be	sustained	upon examination	by	tax	authorities.	The	Company	reports	a	liability	for	unrecognized	tax	benefits	resulting	from	unrecognized	tax	benefits	taken	or	expected	to	be taken	in	a	tax	return	and	recognizes	interest	and	penalties,	if	any,	related	to	its	unrecognized	tax	benefits	in	income	tax	expense.

The	Tax	Cuts	and	Jobs	Act	contains	a	provision	which	subjects	a	US	parent	of	a	foreign	subsidiary	to	current	US	tax	on	its	global	intangible	low-tax	income ("GILTI").	The	GILTI	income	is	eligible	for	a	deduction,	which	lowers	the	effective	tax	rate	to	10.5%	for	taxable	years	2018	through	2025	and	13.125%	after 2025.	As	the	Company	continues	to	evaluate	its	accounting	policy	with	respect	to	GILTI,	the	provisional	estimates	were	reported	on	the	basis	that	GILTI	will be	accounted	for	as	a	period	cost	when	incurred.	Accordingly,	the	Company	is	not	providing	deferred	taxes	for	basis	differences	expected	to	reverse	as	GILTI.

# Accounting	for	Hedging	Activities

In	August	2017,	the	Financial	Accounting	Standards	Board	(the	"FASB")	issued	Accounting	Standards	Update	("ASU")	2017-12,	Derivatives	and	Hedging (Topic	815),	intending	to	improve	the	transparency	of	information	included	in	the	financial	statements	by	aligning	cash	flow	and	fair	value	hedge	accounting with	its	risk	management	activities.	The	ASU	eliminates	the	requirement	to	separately	measure	and	report	hedge	ineffectiveness	for	cash	flow	hedges	and	net investment	hedges,	and	generally	requires	the	entire	change	in	the	fair	value	of	a	hedging	instrument	to	be	presented	in	the	same	income	statement	line	as	the hedged	item.	The	ASU	also	simplifies	certain	documentation	and	assessment	requirements,	and	will	incorporate	new	disclosure	requirements	and	amendments to	existing	disclosures.	This	ASU	is	effective	for	the	Company	beginning	the	first	quarter	of	2019	and	allows	for	early	adoption.	The	Company	is	currently evaluating	the	impact	the	ASU	will	have	on	its	Consolidated	Financial	Statements.

# Accounting	for	Goodwill	Impairment

In	January	2017,	the	FASB	issued	ASU	2017-04,	Simplifying	the	Test	for	Goodwill	Impairment	(Topic	350).	The	amendments	in	this	update	eliminate	step two	of	the	current	two-step	process,	which	requires	a	hypothetical	purchase	price	allocation	when	an	impairment	is	determined	to	have	occurred.	This	ASU 2017-04	is	effective	for	the	Company	beginning	in	the	first	quarter	of	2020	and	allows	for	early	adoption.	The	Company	elected	to	early	adopt	this	standard during	the	third	quarter	of	2017.	The	Company	will	continue	to	perform	the	quantitative	goodwill	impairment	evaluation

by	comparing	the	fair	value	of	each	reporting	unit	to	its	carrying	amount.	Under	the	new	standard,	if	the	Company	is	required	to	recognize	an	impairment charge,	the	amount	of	the	charge	will	be	measured	as	the	excess	of	a	reporting	unit's	carrying	amount	over	its	fair	value,	not	to	exceed	the	carrying	amount	of goodwill.	The	adoption	of	this	ASU	did	not	have	an	impact	on	the	Company's	Consolidated	Financial	Statements.

# Classification	of	Certain	Cash	Receipts	and	Cash	Payments

In	August	2016,	the	FASB	issued	ASU	2016-15,	Classification	of	Certain	Cash	Receipts	and	Cash	Payments	(Topic	230),	providing	guidance	for	eight	specific cash	 flow	 issues	 with	 the	 objective	 of	 reducing	 the	 existing	 diversity	 in	 practice.	Among	 the	 updates,	 this	 standard	 requires	 cash	 payments	 for	 debt extinguishment	costs	to	be	classified	as	cash	outflows	from	financing	activities,	which	is	consistent	with	the	Company's	current	practice.	This	ASU	is	effective for	the	Company	beginning	in	the	first	quarter	of	2018	and	allows	for	early	adoption.	The	Company	elected	to	early	adopt	this	standard	during	the	third	quarter of	2017.	The	adoption	of	this	ASU	did	not	have	an	impact	on	the	Company's	Consolidated	Financial	Statements.

# Measurement	of	Credit	Losses	on	Financial	Instruments

In	June	2016,	the	FASB	issued	ASU	2016-13,	Financial	Instruments	-	Credit	Losses	(Topic	326):	Measurement	of	Credit	Losses	on	Financial	Instruments. This	ASU	introduces	a	new	forward-looking	approach,	based	on	expected	losses,	to	estimate	credit	losses	on	certain	types	of	financial	instruments,	including trade	 receivables.	 The	 estimate	 of	 expected	 credit	 losses	 will	 require	 considerations	 of	 historical	 information,	 current	 information	 and	 reasonable	 and supportable	forecasts.	This	ASU	also	expands	the	disclosure	requirements	to	enable	users	of	financial	statements	to	understand	the	assumptions,	models	and methods	for	estimating	expected	credit	losses.	This	ASU	is	effective	for	the	Company	beginning	in	the	first	quarter	of	2020	and	allows	for	early	adoption beginning	in	the	first	quarter	of	2019.	The	Company	is	currently	evaluating	the	impact	the	ASU	will	have	on	its	Consolidated	Financial	Statements.

# Accounting	for	Leases

In	February	2016,	the	FASB	issued	ASU	2016-02,	Leases	(Topic	842),	requiring	lessees	to	recognize	assets	and	liabilities	on	the	balance	sheet	for	the	rights and	obligations	created	by	 long-term	 leases	and	 to	disclose	additional	quantitative	and	qualitative	 information	about	 leasing	arrangements.	This	ASU	 is effective	for	the	Company	beginning	in	the	first	quarter	of	2019	and	allows	for	early	adoption.	Although	the	Company	is	currently	evaluating	the	provisions	of the	ASU	to	determine	how	it	will	be	affected,	the	primary	impact	to	the	Company	of	the	new	ASU	will	be	to	record	assets	and	liabilities	for	current	operating leases,	which	are	principally	related	to	the	Company's	real	estate	portfolio.

In	May	2014,	the	FASB	issued	ASU	2014-09,	Revenue	from	Contracts	with	Customers	(Topic	606),	which,	along	with	amendments	issued	in	2015	and	2016, will	replace	most	existing	revenue	recognition	guidance	under	GAAP	and	eliminate	industry-specific	guidance.	The	core	principle	of	the	new	guidance	is	that an	entity	should	recognize	revenue	for	the	transfer	of	goods	and	services	equal	to	an	amount	it	expects	to	be	entitled	to	receive	for	those	goods	and	services.	The ASU,	as	amended,	will	be	effective	for	the	Company	beginning	in	the	first	quarter	of	2018.	The	new	guidance	permits	two	methods	of	adoption:	retrospectively to	each	prior	reporting	period	presented	(full	retrospective	method),	or	retrospectively	with	the	cumulative	effect	of	initially	applying	the	guidance	recognized at	the	date	of	initial	application	(the	cumulative	catch-up	transition	method).

The	Company	established	a	cross-functional	implementation	team	to	analyze	the	effect	of	the	ASU.	The	Company	utilized	a	bottom-up	approach	to	analyze	the impact	of	the	standard	on	its	contract	portfolio	by	reviewing	the	current	accounting	policies	and	practices	to	identify	potential	differences	that	would	result from	applying	the	requirements	of	the	new	standard	to	its	revenue	contracts.	In	addition,	the	Company	identified,	and	is	in	the	process	of	implementing, appropriate	changes	to	its	business	processes,	systems	and	controls	to	support	recognition	and	disclosure	under	the	new	standard.	The	implementation	team reports	its	findings	and	progress	of	the	project	to	management	and	the	Audit	Committee	on	a	frequent	basis.

The	Company	adopted	the	guidance	on	January	1,	2018,	and	utilized	the	full	retrospective	method.

The	Company	has	finalized	its	accounting	policies	under	the	new	standard	and	it	has	determined:

•The	accounting	for	bill	and	hold	transactions	will	result	in	revenue	for	certain	of	those	arrangements	being	recognized	earlier	than	under	current GAAP.	This	change	will	not	materially	impact	Net	sales	or	Net	income;

•In	certain	security	software	transactions	when	accompanying	third-party	delivered	software	assurance	is	deemed	to	be	critical	or	essential	to	the	core functionality	of	the	software	license,	the	Company	has	determined	that	the	software	license	and	the	accompanying	third-party	delivered	software assurance	are	a	single	performance	obligation.	The	value	of	the	product	is	primarily	the	accompanying	support	delivered	by	a	third-party	and	therefore the	Company	is	acting	as	an	agent	in	these	transactions	and	will	recognize	them	on	a	net	basis.	The	Company	currently	recognizes	revenue	from	the software	license	on	a	gross	basis	(i.e.,	acting	as	a	principal)	and	accompanying	third-party	delivered	software	assurance	on	a	net	basis.	This	change will	reduce	both	Net	sales	and	Cost	of	sales	with	no	impact	on	reported	Gross	profit.

•The	 accounting for revenue related to	 hardware, software (excluding the above) and services	 will remain substantially unchanged.

The	adoption	of	the	ASU	is	expected	to	impact	the	Company's	results	as	follows:

|  |  | December	31,	2017 |  |  | December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions)\n(except\tper\tshare\tamounts) | As\tReported | New\tRevenue\nStandard\nAdjustment | As\tAdjusted | As\tReported | New\tRevenue\nStandard\nAdjustment | As\tAdjusted |
| Net\tsales | \t $15,191.5 | \t $(358.6) | \t $14,832.9 | \t $13,981.9 | \t $(309.2) | \t $13,672.7 |
| Gross\tprofit | 2,449.9 | 0.3 | \t $2,450.2 | 2,327.2 | 1.1 | 2,328.3 |
| Gross\tprofit\tmargin | 16.1% | 40\tbps | 16.5% | 16.6% | 40\tbps | 17.0% |
| Income\tfrom\toperations | 866.1 | 0.4 | 866.5 | 819.2 | 0.8 | 820.0 |
| Income\ttax\texpense | (137.3) | (0.3) | (137.6) | (248.0) | (0.1) | (248.1) |
| Net\tincome | \t $523.0 | \t $0.1 | \t $523.1 | \t $424.4 | \t $0.7 | \t $425.1 |
| Net\tincome\tper\tcommon\nshare |  |  |  |  |  |  |
| Basic | \t $3.37 | \t $— | \t $3.37 | \t $2.59 | \t $0.01 | \t $2.60 |
| Diluted | \t $3.31 | \t $— | \t $3.31 | \t $2.56 | \t $— | \t $2.56 |

|  |  | December	31,	2017 |  |  | December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | As\tReported | New\tRevenue\nStandard\tAdjustment | As\tAdjusted(1) | As\tReported | New\tRevenue\nStandard\tAdjustment | As\tAdjusted |
| Accounts\treceivable | \t $2,320.5 | \t $8.8 | \t $2,329.3 | \t $2,168.6 | \t $0.3 | \t $2,168.9 |
| Merchandise\tinventory | 449.5 | (38.0) | 411.5 | 452.0 | (28.1) | 423.9 |
| Miscellaneous\treceivables | 336.5 | 6.5 | 343.0 | 234.9 | 2.6 | 237.5 |
| Prepaid\texpenses\tand\tother | 127.4 | 40.9 | 168.3 | 118.9 | 35.3 | 154.2 |
| Total\tcurrent\tassets | 3,378.1 | 18.2 | 3,396.3 | 3,238.1 | 10.1 | 3,248.2 |
| Other\tassets | 40.8 | (8.1) | 32.7 | 36.0 | (0.1) | 35.9 |
| Total\tassets | 6,956.6 | 10.1 | 6,966.7 | 6,948.4 | 10.0 | 6,958.4 |
| Deferred\trevenue | 194.0 | (35.2) | 158.8 | 172.6 | (29.1) | 143.5 |
| Income\ttax\tpayable | 15.1 | 1.1 | 16.2 | 2.6 | 0.7 | 3.3 |
| Other\taccrued\texpenses | 180.2 | 41.6 | 221.8 | 147.2 | 36.0 | 183.2 |
| Total\tcurrent\tliabilities | 2,514.6 | 7.5 | 2,522.1 | 2,280.7 | 7.6 | 2,288.3 |
| Total\tliabilities | 5,973.7 | 7.5 | 5,981.1 | 5,902.9 | 7.6 | 5,910.5 |
| Total\tstockholders'\tequity | \t $982.9 | \t $2.7 | \t $985.6 | \t $1,045.5 | \t $2.4 | \t $1,047.9 |

(1) Amounts may not cross-foot due to rounding.

The	adoption	of	the	ASU	did	not	impact	cash	flow	provided	by	operating	activities	for	the	years	ended	December	31,	2017	and	2016.

# 3. Acquisition

On	August	1,	2015,	the	Company	completed	the	acquisition	of	CDW	UK	by	purchasing	the	remaining	65%	of	its	outstanding	common	stock	which	increased the	Company's	ownership	interest	from	35%	to	100%,	and	provided	the	Company	control.

A	summary	of	the	total	consideration	transferred	is	as	follows:

| (in	millions) | Acquisition-Date	Fair	Value |
| :--- | :--- |
| Cash | \t $291.6 |
| Fair\tvalue\tof\tCDW\tcommon\tstock(1) | 33.2 |
| Fair\tvalue\tof\tpreviously\theld\tequity\tinvestment\ton\tthe\tdate\tof\tacquisition(2) | 174.9 |
| Total\tconsideration | \t $499.7 |

(1) The	Company	issued	2	million	shares	of	CDW	common	stock.	The	fair	value	of	the	common	stock	was	based	on	the	closing	market	price	on	July	31, 2015,	adjusted	for	the	lack	of	marketability	as	the	shares	of	CDW	common	stock	issued	to	certain	sellers	are	subject	to	a	three-year	lock	up	restriction from	August	1,	2015.	One	of	the	sellers	granted	1	million	stock	options	to	certain	CDW	UK	coworkers	over	his	shares	of	CDW	common	stock received	in	the	transaction.	The	fair	value	of	these	stock	options	was	$22	million,	which	has	been	accounted	for	as	post-combination	stock-based compensation	and	is	being	amortized	over	the	weighted-average	requisite	service	period	of	3.2	years	and	recorded	in	Selling	and	administrative expenses	in	the	Consolidated	Statements	of	Operations.

(2) As	a	result	of	the	Company	obtaining	control	over	CDW	UK,	the	Company's	previously	held	35%	equity	investment	was	remeasured	to	fair	value, resulting	in	a	gain	of	$98	million	included	in	Gain	on	remeasurement	of	equity	investment	in	the	Consolidated	Statements	of	Operations.	The	fair value	 of	 the	 previously	 held	 equity	 investment	 was	 determined	 by	 management	 with	 the	 assistance	 of	 a	 third	 party	 valuation	 firm,	 based	 on information	available	at	the	acquisition	date.

The	unaudited	pro	forma	Consolidated	Statements	of	Operations	in	the	table	below	summarizes	the	combined	results	of	operations	of	the	Company	and	CDW UK,	as	if	the	acquisition	had	been	completed	on	January	1,	2015,	and	gives	effect	to	pro	forma	events	that	are	factually	supportable	and	directly	attributable	to the	transaction.	The	unaudited	pro	forma	results	reflect	adjustments	for	equity-based	compensation,	acquisition	and	integration	costs,	incremental	intangible asset	amortization	based	on	the	fair	values	of	each	identifiable	intangible	asset,	which	are	subject	to	change	within	the	measurement	period,	pre-acquisition equity	earnings,	the	gain	on	the	remeasurement	of	the	Company's	previously	held	35%	equity	method	investment,	elimination	of	pre-acquisition	intercompany sales	transactions	and	the	impacts	of	certain	other	pre-acquisition	transactions.	Pro	forma	adjustments	were	tax-effected	at	the	statutory	rates	within	 the applicable	jurisdictions.

This	unaudited	pro	forma	information	is	presented	for	informational	purposes	only	and	may	not	be	indicative	of	the	historical	results	of	operations	that	would have	been	obtained	if	the	acquisition	had	taken	place	on	January	1,	2015,	nor	the	results	that	may	be	obtained	in	the	future.	This	unaudited	pro	forma information	does	not	reflect	future	synergies,	integration	costs	or	other	such	costs	or	savings.

The	unaudited	pro	forma	Consolidated	Statements	of	Operations	is	as	follows:

The	unaudited	pro	forma	information	above	reflects	the	following	adjustments:

(i) Excludes acquisition and integration expenses directly related to the transaction.

(ii) Includes additional amortization expense related to the fair value of acquired intangibles.

(iii) Excludes	the	gain	of	resulting	from	the	remeasurement	of	the	Company's	previously	held	35%	equity	investment	to	fair	value	upon	the	completion	of the	acquisition.

(iv) Excludes the	 Company's share	 of	 net income/loss from its	 previously	 held	35%	 equity investment	 prior to the	 completion	 of the acquisition.

(v) Excludes	non-cash	equity-based	compensation	related	to	certain	equity	awards	granted	by	one	of	the	sellers	to	CDW	UK	coworkers	in	July	2015	prior to	the	completion	of	the	acquisition.

(vi) Includes	 additional	 non-cash	 equity-based	 compensation related to	 equity	 awards	 granted to	 CDW	 UK	 coworkers	 after the	 completion	 of the acquisition.

(vii) Includes	 the elimination of inter-company sales transactions prior to the completion of the acquisition.

Miscellaneous	receivables	consist	of	the	following:

| (in	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Vendor\tpartner\treceivables | \t $279.2 | \t $186.6 |
| Other | 57.3 | 48.3 |
| Total | \t $336.5 | \t $234.9 |

Property	and	equipment	consists	of	the	following:

| (in	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Building\tand\tleasehold\timprovements | \t $123.0 | \t $120.4 |
| Computer\tand\tdata\tprocessing\tequipment | 116.4 | 101.7 |
| Machinery\tand\tequipment | 45.6 | 43.2 |
| Land | 27.7 | 27.7 |
| Furnitures\tand\tfixtures | 22.7 | 23.8 |
| Construction\tin\tprogress | 17.9 | 20.4 |
| Computer\tsoftware | 9.6 | 10.8 |
| Property\tand\tequipment,\tgross | 362.9 | 348.0 |
| Less:\taccumulated\tdepreciation | (201.8) | (184.3) |
| Property\tand\tequipment,\tnet | \t $161.1 | \t $163.7 |

During	2017,	2016	and	2015,	the	Company	recorded	disposals	of	$23	million,	$50	million	and	$17	million,	respectively,	to	remove	assets	that	were	no	longer in	use	from	property	and	equipment.	The	Company	recorded	a	pre-tax	loss	of	less	than	$1	million	for	all	periods	for	certain	disposed	assets	that	were	not	fully depreciated.

# 6. Goodwill	and	Other	Intangible	Assets

The	changes	in	goodwill	by	reportable	segment	are	as	follows:

| (in	millions) | Corporate | Small	Business(2) | Public | Other(4) | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t31,\t2014(1) | \t $1,045.9 | \t $185.9 | \t $911.3 | \t $74.5 | \t $2,217.6 |
| Foreign\tcurrency\ttranslation | — | — | — | (22.4) | (22.4) |
| Acquisition | — | — | — | 305.2 | 305.2 |
| Balance\tat\tDecember\t31,\t2015(1) | 1,045.9 | 185.9 | 911.3 | 357.3 | 2,500.4 |
| Foreign\tcurrency\ttranslation | — | — | — | (45.4) | (45.4) |
| CDW\tAdvanced\tServices\tAllocation(3) | 28.2 | — | 18.3 | (46.5) | — |
| Balance\tat\tDecember\t31,\t2016(1) | 1,074.1 | 185.9 | 929.6 | 265.4 | 2,455.0 |
| Foreign\tcurrency\ttranslation | — | — | — | 24.6 | 24.6 |
| Balances\tas\tof\tDecember\t31,\t2017(1) | \t $1,074.1 | $185.9 | $929.6 | $290.0 | $2,479.6 |

(1) Goodwill	 is	 net	 of	 accumulated impairment losses	 of	$1,571	million,	$354	million and	$28	million	related to the	 Corporate,	 Public	 and	 Other segments,	respectively.

(3) Effective January	 1,	 2016, the	 CDW	Advanced	 Services	 business is included in the	 Company's	 Corporate	 and	 Public segments.

(4) Other	 is comprised of Canada and CDW UK operating segments.

With	the	establishment	of	Small	Business	as	its	own	reporting	unit,	the	Company	performed	a	quantitative	analysis	in	order	to	allocate	Goodwill	between Corporate	and	Small	Business.	Based	on	the	results	of	the	quantitative	analysis	performed	as	of	January	1,	2017,	the	Company	determined	that	the	fair	values of	Corporate	and	Small	Business	reporting	units	exceeded	their	carrying	values	by	227%	and	308%,	respectively,	and	no	impairment	existed.

# December	1,	2017	Impairment	Analysis

The	Company	completed	its	annual	impairment	analysis	as	of	December	1,	2017.	For	the	Corporate,	Small	Business	and	UK	reporting	units,	the	Company performed	a	qualitative	analysis.	The	Company	determined	that	it	was	more-likely-than-not	that	the	individual	fair	values	of	the	Corporate,	Small	Business	and UK	reporting	units	exceeded	the	respective	carrying	values	and	therefore	a	quantitative	impairment	analysis	was	deemed	unnecessary.	Although	uncertainty regarding	the	impact	of	the	Referendum	on	the	UK's	Membership	of	the	European	Union	("EU"),	advising	for	the	exit	of	the	UK	from	the	EU	(referred	to	as "Brexit")	still	exists	in	the	current	year,	the	Company	does	not	believe	there	to	be	any	additional	risk	that	would	indicate	the	quantitative	analysis	performed	in the	prior	year	would	have	a	different	result.	Therefore,	a	qualitative	analysis	was	deemed	appropriate	for	the	UK	reporting	unit.	The	Company	performed	a quantitative	analysis	of	the	Public	and	Canada	reporting	units.	Based	on	the	results	of	the	quantitative	analysis,	the	Company	determined	that	the	fair	value	of the	Public	and	Canada	reporting	units	exceeded	their	carrying	values	by	179%	and	153%,	respectively,	and	no	impairment	existed.

The	Company	completed	its	annual	impairment	analysis	as	of	December	1,	2016.	For	the	Corporate	(which,	as	of	December	1,	2016,	included	Small	Business), Public	and	Canada	reporting	units,	the	Company	performed	a	qualitative	analysis.	The	Company	determined	that	it	was	more-likely-than-not	that	the	individual fair	values	of	the	Corporate,	Public	and	Canada	reporting	units	exceeded	the	respective	carrying	values.	As	a	result	of	this	determination,	the	quantitative impairment	analysis	was	deemed	unnecessary.	Due	 to	 the	substantial	uncertainty	regarding	 the	 impact	of	Brexit,	 the	Company	performed	a	quantitative analysis	of	the	CDW	UK	reporting	unit.	Based	on	the	results	of	the	quantitative	analysis,	the	Company	determined	that	the	fair	value	of	the	CDW	UK	reporting unit	exceeded	its	carrying	value	and	no	impairment	existed.

# Other	Intangible	Assets

# A	summary	of	intangible	assets	is	as	follows:

| December	31,	2017 | Gross<br>Carrying<br>Amount | Accumulated<br>Amortization | Net	Carrying	Amount |
| :--- | :--- | :--- | :--- |
| Customer\trelationships\tand\tcontracts | \t $2,106.8 | \t $(1,490.8) | \t $616.0 |
| Trade\tname | 422.2 | (216.3) | 205.9 |
| Internally\tdeveloped\tsoftware | 162.6 | (89.6) | 73.0 |
| Other | 2.9 | (0.8) | 2.1 |
| Total | \t $2,694.5 | \t $(1,797.5) | \t $897.0 |
| December\t31,\t2016 |  |  |  |
| Customer\trelationships\tand\tcontracts | \t $2,084.6 | \t $(1,322.7) | \t $761.9 |
| Trade\tname | 422.1 | (195.2) | 226.9 |
| Internally\tdeveloped\tsoftware | 142.6 | (77.7) | 64.9 |
| Other | 6.0 | (4.1) | 1.9 |
| Total | \t $2,655.3 | \t $(1,599.7) | \t $1,055.6 |

During	the	years	ended	December	31,	2017	and	2016,	the	Company	recorded	disposals	of	$24	million	and	$29	million,	respectively,	to	remove	fully	amortized internally	developed	software	assets	that	were	no	longer	in	use.

Amortization	expense	related	to	intangible	assets	for	the	years	ended	December	31,	2017,	2016	and	2015	was	$221	million,	$216	million and	$199	million, respectively.

Estimated	future	amortization	expense	related	to	intangible	assets	is	as	follows:

| (in	millions) |  |
| :--- | :--- |
| Years\tending\tDecember\t31, | Estimated\tFuture\tAmortization\nExpense |
| 2018 | \t $219.8 |
| 2019 | 201.4 |
| 2020 | 167.6 |
| 2021 | 72.3 |
| 2022 | 38.4 |
| Thereafter | 197.5 |
| Total\tfuture\tamortization\texpense | \t $897.0 |

The	Company	has	entered	into	agreements	with	certain	financial	intermediaries	to	facilitate	the	purchase	of	inventory	from	various	suppliers	under	certain terms	and	conditions,	as	described	below.	These	amounts	are	classified	separately	as	Accounts	payable-inventory	financing	on	the	Consolidated	Balance Sheets.	The	Company	does	not	incur	any	interest	expense	associated	with	these	agreements	as	balances	are	paid	when	they	are	due.

Amounts	included	in	accounts	payable-inventory	financing	are	as	follows:

| (in	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Revolving\tLoan\tinventory\tfinancing\tagreement(1) | $480.9 | \t $558.3 |
| Other\tinventory\tfinancing\tagreements(2) | 17.1 | 22.1 |
| Accounts\tpayable-inventory\tfinancing | $498.0 | \t $580.4 |

(1) The	Senior	Secured	Asset-Based	Revolving	Credit	Facility	("Revolving	Loan")	includes	an	inventory	floorplan	sub-facility	that	enables	the	Company to	maintain	an	inventory	financing	agreement	with	a	financial	intermediary	to	facilitate	the	purchase	of	inventory	from	certain	vendors	on	more favorable	terms	than	offered	directly	by	the	vendors.

(2) The	Company	also	maintains	other	inventory	financing	agreements	with	financial	intermediaries	to	facilitate	the	purchase	of	inventory	from	certain vendors.	As	of	December	31,	2017	and	2016,	amounts	collateralized	by	the	inventory	purchased	under	these	financing	agreements	and	a	second	lien on	the	related	accounts	receivable	were	$1	million	and	$3	million,	respectively.

# 8. Lease	Commitments

The	Company	is	obligated	under	various	non-cancelable	operating	lease	agreements	for	office	facilities	that	generally	provide	for	minimum	rent	payments	and a	proportionate	share	of	operating	expenses	and	property	taxes	and	include	certain	renewal	and	expansion	options.	For	the	years	ended	December	31,	2017, 2016	and	2015,	rent	expense	under	these	lease	arrangements	was	$29	million,	$27	million	and	$25	million,	respectively.	Capital	leases	included	in	property	and equipment	are	not	significant.

Future	minimum	lease	payments	under	non-cancelable	operating	leases	as	of	December	31,	2017	are	as	follows:

| (in	millions) |  |
| :--- | :--- |
| Years\tending\tDecember\t31, | Future\tMinimum\tLease\nPayments |
| 2018 | \t $22.1 |
| 2019 | 21.8 |
| 2020 | 21.0 |
| 2021 | 14.5 |
| 2022 | 9.0 |
| Thereafter | 43.4 |
| Total\tfuture\tminimum\tlease\tpayments | \t $131.8 |

# 9. Financial	Instruments

The	Company's	indebtedness	creates	interest	rate	risk	on	its	variable-rate	debt.	The	Company	uses	derivative	financial	instruments	to	manage	its	exposure	to interest	rate	risk.	The	Company	does	not	hold	or	issue	derivative	financial	instruments	for	trading	or	speculative	purposes.

The	Company	has	interest	rate	cap	agreements	that	entitle	it	to	payments	from	the	counterparty	of	the	amount,	if	any,	by	which	three-month	LIBOR	exceeds 1.5%	during	the	agreement	period.	The	interest	rate	cap	agreements	are	in	effect	from	January	17,	2017	through	December	31,	2018	with	a	combined	notional amount	of	$1.4	billion.	As	of	December	31,	2017	and	2016,	the	interest	rate	cap	agreements	had	a	fair	value	of	$5	million	and	are	classified	within	Other	Assets on	the	Consolidated	Balance	Sheets.

The	fair	value	of	the	Company's	interest	rate	cap	agreements	is	classified	as	Level	2	in	the	fair	value	hierarchy.	The	valuation	of	the	interest	rate	cap	agreements is	derived	by	using	a	discounted	cash	flow	analysis	on	the	expected	cash	receipts	that	would	occur	if	variable	interest	rates	rise	above	the	strike	rates	of	the caps.	This	analysis	reflects	the	contractual	terms	of	the	interest	rate	cap	agreements,	including	the	period	to	maturity,	and	uses	observable	market-based	inputs, including	 LIBOR	 curves	 and	 implied	 volatilities.	 The	 Company	 also	 incorporates	 insignificant	 credit	 valuation	 adjustments	 to	 appropriately	 reflect	 the respective	counterparty's	nonperformance	risk	in	the	fair	value	measurements.

The	counterparty	credit	spreads	are	based	on	publicly	available	credit	information	obtained	from	a	third	party	credit	data	provider.	For	additional	details, see	Note	10	(Long-Term	Debt).

During	the	first	quarter	of	2017,	the	Company	designated	the	interest	rate	cap	agreements	as	cash	flow	hedges.	The	effective	portion	of	changes	in	the	fair	value of	derivatives	that	qualify	as	cash	flow	hedges	is	recorded	in	Accumulated	other	comprehensive	loss	and	is	subsequently	reclassified	into	Interest	expense	in	the period	when	the	hedged	forecasted	transaction	affects	earnings.	If	a	derivative	is	deemed	to	be	ineffective,	the	ineffective	portion	of	the	change	in	fair	value	of the	derivative	is	recognized	directly	into	earnings.	The	Company's	interest	rate	cap	agreements	were	deemed	effective	during	2017,	and	the	Company	expects the	derivatives	will	continue	to	be	effective	for	the	next	twelve	months.	The	Company	recorded	an	insignificant	gain,	net	of	tax	expense,	for	the	effective portion	of	the	interest	rate	cap	agreements	into	Accumulated	other	comprehensive	loss	for	the	year	ended	December	31,	2017.	 During	2017,	the	Company reclassified	an	insignificant	amount	from	Accumulated	other	comprehensive	loss	into	Interest	expense.	The	Company	expects	to	reclassify	$5	million	from Accumulated	other	comprehensive	loss	into	Interest	expense	during	the	next	twelve	months.

Prior	to	the	election	of	hedge	accounting	treatment,	the	Company	recognized	less	than	$1	million	 and	$3	million	of	Interest	income	during	2017 and	2016, respectively,	in	the	Company's	Consolidated	Statement	of	Operations	related	to	the	changes	in	the	fair	value	of	the	interest	rate	cap	agreements.

# 10. Long-Term	Debt

Long-term	debt	as	of	December	31,	2017	is	as	follows:

| (dollars	in	millions) | Interest	Rate | Principal | Unamortized	Discount<br>and	Deferred	Financing<br>Costs | Total |
| :--- | :--- | :--- | :--- | :--- |
| Senior\tsecured\tasset-based\trevolving\tcredit\tfacility | —% | \t $— | \t $— | \t $— |
| CDW\tUK\trevolving\tcredit\tfacility | —% | — | — | — |
| Senior\tsecured\tterm\tloan\tfacility\t(1) | 3.7% | 1,468.0 | (2.0) | 1,466.0 |
| CDW\tUK\tterm\tloan | 1.9% | 75.7 | (1.4) | 74.3 |
| Senior\tnotes\tdue\t2023 | 5.0% | 525.0 | (4.5) | 520.5 |
| Senior\tnotes\tdue\t2024 | 5.5% | 575.0 | (5.2) | 569.8 |
| Senior\tnotes\tdue\t2025 | 5.0% | 600.0 | (7.3) | 592.7 |
| Other\tlong-term\tobligations |  | 12.2 | — | 12.2 |
| Total\tdebt |  | 3,255.9 | (20.4) | 3,235.5 |
| Less\tcurrent\tmaturities |  | (25.5) | — | (25.5) |
| Long-term\tdebt,\texcluding\tcurrent\tmaturities |  | \t $3,230.4 | \t $(20.4) | \t $3,210.0 |

(1) The	Senior	secured	term	loan	facility	has	a	variable	interest	rate,	which	has	effectively	been	capped	through	the	use	of	an	interest	rate	cap	(see	Note	9 (Financial	Instruments)).	The	interest	rate	disclosed	represents	the	variable	interest	rate	in	effect	as	of	year	ended	December	31,	2017.

| (dollars	in	millions) | Interest	Rate | Principal | Unamortized	Discount<br>and	Deferred	Financing<br>Costs | Total |
| :--- | :--- | :--- | :--- | :--- |
| Senior\tsecured\tasset-based\trevolving\tcredit\tfacility | —% | \t $— | \t $— | \t $— |
| CDW\tUK\trevolving\tcredit\tfacility | —% | — | — | — |
| Senior\tsecured\tterm\tloan\tfacility | 3.3% | 1,483.0 | (14.9) | 1,468.1 |
| CDW\tUK\tterm\tloan | 1.8% | 69.1 | (1.6) | 67.5 |
| Senior\tnotes\tdue\t2022 | 6.0% | 600.0 | (5.6) | 594.4 |
| Senior\tnotes\tdue\t2023 | 5.0% | 525.0 | (5.3) | 519.7 |
| Senior\tnotes\tdue\t2024 | 5.5% | 575.0 | (6.0) | 569.0 |
| Other\tlong-term\tobligations |  | 15.7 | — | 15.7 |
| Total\tlong-term\tdebt |  | 3,267.8 | (33.4) | 3,234.4 |
| Less\tcurrent\tmaturities\tof\tlong-term\tdebt |  | (18.5) | — | (18.5) |
| Long-term\tdebt,\texcluding\tcurrent\tmaturities |  | \t $3,249.3 | $(33.4) | $3,215.9 |

Senior	Secured	Asset-Based	Revolving	Credit	Facility	("Revolving	Loan")

As	 of	December	31,	2017,	the	Company	had	no	outstanding	borrowings	under	the	Revolving	Loan,	less	than	$1	million	of	undrawn	letters	of	credit,	$454 million	reserved	for	the	floorplan	sub-facility	and	a	borrowing	base	of	$1.6	billion,	which	is	based	on	the	amount	of	eligible	inventory	and	accounts	receivable balances	as	of	November	30,	2017.	Borrowings	under	the	Revolving	Loan	are	limited	by	the	borrowing	base.	As	of	December	31,	2017,	the	Company	could have	borrowed	up	to	an	additional	$996	million	under	the	Revolving	Loan.	Borrowings	are	also	limited	by	a	minimum	liquidity	condition,	which	provides	that, if	excess	cash	availability	is	less	than	the	lower	of	(i)	$125	million	and	(ii)	the	greater	of	(a)	10.0%	of	the	borrowing	base,	and	(b)	$100	million,	the	lenders	are not	required	to	lend	additional	amounts	under	the	Revolving	Loan	unless	the	consolidated	fixed	charge	coverage	ratio,	as	defined,	is	at	least	1.00	to	1.00.

Borrowings	under	the	Revolving	Loan	bear	interest	at	a	variable	interest	rate	plus	an	applicable	margin.	The	interest	rate	margin	is	based	on	one	of	two	indices, either	(i)	LIBOR	or	(ii)	the	Alternate	Base	Rate	("ABR"),	with	the	ABR	being	the	greater	of	(a)	the	prime	rate,	(b)	the	federal	funds	effective	rate	plus	50	basis points	 or	 (c)	 the	 one-month	 LIBOR	 plus	1.00%.	The	applicable	margin	varies	(1.25%	 to	1.75%	 for	 LIBOR	 borrowings	 and	0.25%	 to	0.75%	 for	ABR borrowings)	depending	upon	average	daily	excess	cash	availability	under	the	agreement	evidencing	the	Revolving	Loan.

On	March	31,	2017,	the	Company	amended,	extended	and	increased	its	Revolving	Loan	to	a	five-year,	$1.5	billion	senior	secured	asset-based	revolving	credit facility,	with	the	facility	being	available	to	the	Company	for	borrowings,	issuance	of	letters	of	credit	and	floorplan	financing.	The	Revolving	Loan	matures	on March	31,	2022.	The	Revolving	Loan	replaces	the	Company's	previous	revolving	loan	credit	facility	that	was	to	mature	on	June	6,	2019.	The	Revolving	Loan (i)	increases	the	overall	revolving	credit	facility	capacity	available	to	the	Company	from	$1.3	billion	to	$1.5	billion,	(ii)	maintains	the	maximum	aggregate amount	of	increases	that	may	be	made	to	the	revolving	credit	facility	of		$300	million,	(iii)	maintains	the	fees	on	the	unused	portion	of	the	revolving	credit facility	at	25	basis	points,	(iv)	makes	permanent	the	25	basis	point	reduction	in	the	applicable	interest	rate	margin	that	was	previously	conditioned	on	meeting certain	credit	ratings	levels,	and	(v)	maintains	the	existing	inventory	floorplan	sub-facility.	In	connection	with	the	amendment	of	the	previous	facility,	the Company	recorded	a	loss	on	extinguishment	of	long-term	debt	of	$1	million	in	the	Consolidated	Statement	of	Operations	for	the	year	ended	December	31, 2017,	representing	a	write-off	of	a	portion	of	unamortized	deferred	financing	costs.	Fees	of	$4	million	related	to	the	Revolving	Loan	were	capitalized	as deferred	financing	costs	and	are	being	amortized	over	the	five-year	term	of	the	facility	on	a	straight-line	basis.	These	deferred	financing	costs	are	recorded	in Other	assets	on	the	Consolidated	Balance	Sheets.

# Senior	Secured	Term	Loan	Facility	("Term	Loan")

On	December	31,	2017,	the	outstanding	principal	amount	of	the	Term	Loan	was	$1.5	billion,	excluding	$2	million	of	deferred	financing	costs.	On	February	28, 2017,	the	Company	amended	the	Term	Loan	to	reprice	the	facility,	reducing	interest	rate	margins	by	25	basis	points.	Borrowings	under	the	Term	Loan	bear interest	at	either	(i)	the	ABR	plus	a	margin	or	(ii)	LIBOR	plus	a	margin,	payable	quarterly	on	the	last	day	of	each	March,	June,	September	and	December.	The margin

is	based	upon	a	net	leverage	ratio	as	defined	in	the	agreement	governing	the	Term	Loan,	which	is	1.00%	for	ABR	borrowings	and	2.00%	for	LIBOR	borrowings as	of	December	31,	2017.

The	Term	Loan	was	issued	at	par.	The	Term	Loan	replaced	the	prior	senior	secured	term	loan	facility	(the	"Prior	Term	Loan	Facility")	that	had	an	outstanding aggregate	principal	amount	of	$1.5	billion.	The	Company	is	required	to	pay	quarterly	principal	installments	equal	to	0.25%	of	the	original	principal	amount	of the	Prior	Term	Loan	Facility,	with	the	remaining	principal	amount	payable	on	the	maturity	date	of	August	17,	2023,	which	was	retained	from	the	Prior	Term Loan	Facility.	In	connection	with	this	refinancing,	the	Company	recorded	a	loss	on	extinguishment	of	long-term	debt	of	$14	million	in	the	Consolidated Statement	of	Operations	for	the	year	ended	December	31,	2017.	This	loss	represented	the	write-off	of	a	portion	of	the	unamortized	deferred	financing	costs	of $5	million	and	unamortized	discount	related	to	the	Prior	Term	Loan	Facility	of	$9	million.	In	connection	with	the	issuance	of	the	Term	Loan,	the	Company incurred	and	recorded	$2	million	in	deferred	financing	fees,	which	are	recorded	as	a	reduction	to	the	debt	and	presented	in	the	above	table	as	of	December	31, 2017.

# CDW	UK	Term	Loan

On	August	1,	2016,	the	Company	entered	into	a	new	five-year	£56	million	($76	million	at	December	31,	2017)	aggregate	principal	amount	term	loan	facility ("CDW	UK	Term	Loan"),	which	replaced	the	prior	senior	secured	term	loan	facility	(the	"Prior	CDW	UK	Term	Loan	Facility")	that	had	an	outstanding principal	amount	of	£56	million.	Fees	of	$1	million	were	capitalized	as	deferred	financing	costs	and	are	being	amortized	over	the	term	of	the	loan	on	a	straight- line	basis.

Commencing	during	the	quarter	ending	September	30,	2018,	the	Company	is	required	to	make	annual	principal	installments	of	£5	million	($7	million	at December	31,	2017),	with	the	remaining	principal	amount	payable	on	the	maturity	date	of	August	1,	2021.	Borrowings	under	the	CDW	UK	Term	Loan	bear interest	at	LIBOR	plus	a	margin,	payable	quarterly	on	the	last	day	of	each	March,	June,	September	and	December.	As	of	December	31,	2017,	an	interest	rate of	1.92%	was	in	effect,	which	represents	LIBOR	plus	a	1.40%	margin.

In	connection	with	this	refinancing,	the	Prior	CDW	UK	Term	Loan	Facility	was	amended	to	include	both	the	CDW	UK	Term	Loan	and	a	£50	million	($68 million	at	December	31,	2017)	revolving	credit	facility	(the	"CDW	UK	Revolving	Credit	Facility").	As	of	December	31,	2017,	the	Company	had	no	borrowings from	the	CDW	UK	Revolving	Credit	Facility.

On	March	2,	2017,	the	proceeds	from	the	issuance	of	the	2025	Senior	Notes,	discussed	below,	along	with	cash	on	hand	and	proceeds	from	Revolving	Loan borrowings,	were	deposited	with	the	trustee	to	redeem	all	of	the	remaining	$600	million	aggregate	principal	amount	of	the	2022	Senior	Notes	at	a	redemption price	of	106.182%	of	the	principal	amount	redeemed,	plus	accrued	and	unpaid	interest	through	the	date	of	redemption.	The	redemption	date	was	April	2,	2017. On	the	same	date,	the	indenture	governing	the	2022	Senior	Notes	was	satisfied	and	discharged.	In	connection	with	this	redemption,	the	Company	recorded	a loss	 on	 extinguishment	 of	 long-term	 debt	 of	$43	million	 in	 the	Consolidated	Statement	of	Operations	for	 the	year	ended	December	31,	2017.	This	 loss represents	$37	million	in	redemption	premium	and	$6	million	for	the	write-off	of	the	remaining	deferred	financing	costs	related	to	the	2022	Senior	Notes.

At	December	31,	2017,	the	outstanding	principal	amount	of	the	2023	Senior	Notes	was	$525	million.	The	2023	Notes	will	mature	on	September	1,	2023	and bear	interest	rate	of	5.0%	per	annum,	payable	semi-annually	on	March	1	and	September	1	of	each	year.

At	December	31,	2017,	the	outstanding	principal	amount	of	the	2024	Senior	Notes	was	$575	million.	The	2024	Senior	Notes	will	mature	on	December	1,	2024 and	bear	interest	at	a	rate	of	5.5%	per	annum,	payable	semi-annually	on	June	1	and	December	1	of	each	year.

On	March	2,	2017,	the	Company	completed	the	issuance	of	$600	million	aggregate	principal	amount	of	2025	Senior	Notes	at	par.	In	connection	with	the issuance	of	the	2025	Senior	Notes,	the	Company	incurred	and	recorded	$7	million	in	deferred	financing	fees,	which	is	recorded	as	a	reduction	to	the	debt	and presented	in	the	above	table	as	of	December	31,	2017.

At	December	31,	2017,	the	outstanding	principal	amount	of	the	2025	Senior	Notes	was	$600	million.	The	2025	Senior	Notes	will	mature	on	September	1,	2025 and	bear	interest	at	a	rate	of	5.0%	per	annum,	payable	semi-annually	on	March	1	and	September	1	of	each	year.

# Debt	Guarantors,	Covenants	and	Restrictions

CDW	LLC	is	the	borrower	under	the	Term	Loan	and	Revolving	Loan.	CDW	LLC	and	CDW	Finance	Corporation	are	the	co-issuers	of	the	2023,	2024	and	2025 Senior	Notes	("Senior	Notes").	The	obligations	under	the	Term	Loan,	the	Revolving	Loan	and	the	Senior	Notes	are	guaranteed	by	Parent	and	each	of	CDW LLC's	direct	and	indirect,	wholly	owned,	US	subsidiaries	(the	"Guarantors").

The	Revolving	Loan	is	collateralized	by	a	first	priority	interest	in	inventory	(excluding	inventory	collateralized	under	the	inventory	floorplan	arrangements	as described	in	Note	7	(Inventory	Financing	Agreements)),	deposits,	and	accounts	receivable,	and	a	second	priority	interest	in	substantially	all	US	assets.

The	Term	Loan	is	collateralized	by	a	second	priority	interest	in	substantially	all	inventory	(excluding	inventory	collateralized	under	the	inventory	floorplan arrangements	as	described	in	Note	7	(Inventory	Financing	Agreements)),	deposits,	and	accounts	receivable,	and	by	a	first	priority	interest	in	substantially	all other	U.S.	assets.

As	of	December	31,	2017,	the	Company	remained	in	compliance	with	the	covenants	under	its	various	credit	agreements.	The	Term	Loan	contains	negative covenants	that,	among	other	things,	place	restrictions	and	limitations	on	the	ability	of	the	Guarantors	to	dispose	of	assets,	incur	additional	indebtedness,	incur guarantee	 obligations,	 prepay	 other	 indebtedness,	 make	 distributions	 or	 other	 restricted	 payments,	 create	 liens,	 make	 equity	 or	 debt	 investments,	 make acquisitions,	engage	in	mergers	or	consolidations	or	engage	in	certain	transactions	with	affiliates.	As	of	December	31,	2017,	the	amount	of	CDW's	restricted payment	capacity	under	the	Term	Loan	was	$1.2	billion.	However,	the	Company	is	separately	permitted	to	make	restricted	payments,	so	long	as	the	total	net leverage	ratio	is	less	than	3.25:1.00	on	a	pro	forma	basis.	The	total	net	leverage	ratio	was	2.62:1.00	as	of	December	31,	2017.

Each	of	the	Senior	Notes	indentures	contain	negative	covenants	that,	among	other	things,	place	restrictions	and	limitations	on	the	ability	of	the	Guarantors	to enter	into	sale	and	lease-back	transactions,	incur	additional	secured	indebtedness	and	create	liens.	The	indenture	governing	each	of	the	Senior	Notes	do	not contain	any	financial	covenants.

The	CDW	UK	Term	Loan	Agreement	 imposes	restrictions	on	CDW	UK's	ability	 to	 transfer	funds	 to	 the	Company	 through	 the	payment	of	dividends, repayment	of	intercompany	loans,	advances	or	subordinated	debt	that	require,	among	other	things,	the	maintenance	of	a	minimum	net	leverage	ratio.	As	of December	31,	2017,	the	amount	of	restricted	payment	capacity	under	the	CDW	UK	Term	Loan	was	£73	million	($98	million	at	December	31,	2017).

# Long-Term	Debt	Maturities

A	summary	of	Long-term	debt	maturities	is	as	follows:

| (in	millions) |  |
| :--- | :--- |
| Years\tending\tDecember\t31, | Total |
| 2018 | \t $25.5 |
| 2019 | 25.7 |
| 2020 | 25.9 |
| 2021 | 70.3 |
| 2022 | 14.9 |
| Thereafter | 3,093.6 |

# Fair	Value

The	fair	values	of	the	Senior	Notes	were	estimated	using	quoted	market	prices	for	identical	liabilities	that	are	traded	in	over-the-counter	secondary	markets	that are	not	considered	active.	The	fair	value	of	the	Term	Loan	was	estimated	using	dealer	quotes	for	identical	liabilities	in	markets	that	are	not	considered	active. The	Senior	Notes,	Term	Loan,	and	CDW	UK	Term	Loan	are	classified	as	Level	2	within	the	fair	value	hierarchy.	The	carrying	value	of	the	Revolving	Loan	and CDW	UK	Revolving	Loan	approximate	fair	value	if	there	are	outstanding	borrowings.	The	approximate	fair	values	and

related	carrying	values	of	the	Company's	long-term	debt,	including	current	maturities	and	excluding	unamortized	discount	and	unamortized	deferred	financing costs,	were	as	follows:

| (in	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Fair\tvalue | $3,366.5 | \t $3,334.8 |
| Carrying\tvalue | 3,255.9 | 3,267.8 |

# Taxes

On	December	22,	2017,	the	Tax	Cuts	and	Jobs	Act	was	enacted	into	law.	The	Tax	Cuts	and	Jobs	Act	changes	several	aspects	of	US	federal	tax	law	including: reducing	the	US	corporate	income	tax	rate	from	35%	to	21%	beginning	on	January	1,	2018;	establishing	a	territorial	tax	system,	which	includes	a	one-time	tax on	the	deemed	mandatory	repatriation	of	the	Company's	international	operations'	unremitted	earnings	which	have	not	been	subject	to	US	tax;	imposing	a minimum	US	tax	on	foreign	earnings;	providing	for	the	immediate	expensing	of	certain	qualified	property;	and	changing	the	tax	treatment	of	performance based	executive	compensation	and	certain	employee	fringe	benefits.	US	GAAP	requires	the	income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act	to	be	accounted for	in	the	period	of	enactment.

As	of	December	31,	2017,	the	Company	has	not	completed	its	accounting	for	the	income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act;	however,	it	has	recorded provisional	amounts	for	the	impact	of	revaluing	the	deferred	tax	assets	and	liabilities,	the	deemed	mandatory	repatriation	tax	on	the	Company's	international operations'	unremitted	earnings	which	have	not	been	subject	to	US	tax	and	the	state	income	tax	effects	related	to	the	change	in	federal	tax	law.

The	Company	recorded	an	income	tax	benefit	of	$96	million	to	reflect	the	impact	of	revaluing	US	deferred	tax	assets	and	liabilities	to	21%,	which	is	the	rate the	Company	expects	the	deferred	tax	assets	and	liabilities	to	reverse.	The	Company	has	recorded	additional	federal	income	tax	expense	of	$20	million	to reflect	the	deemed	mandatory	repatriation	tax	on	the	Company's	international	operations'	unremitted	earnings	which	have	not	been	subject	to	US	tax.	The mandatory	repatriation	tax	generated	excess	foreign	tax	credits	of	approximately	$14	million,	which	are	available	for	carryforward.	The	Company	does	not expect	to	utilize	the	foreign	tax	credits	carryforwards	prior	to	their	expiration	and	it	has	recorded	a	$14	million	valuation	allowance	against	the	foreign	tax carryforwards.	The	Company	has	recorded	additional	tax	expense	of	less	than	$1	million	for	the	state	income	tax	impact	of	the	Tax	Cuts	and	Jobs	Act.

As	the	Company	completes	its	analysis	and	refines	its	calculations	of	the	federal	and	state	income	tax	impact	of	the	Tax	Cuts	and	Jobs	Act,	it	may	need	to adjust	the	measurement	of	the	deferred	tax	assets	and	liabilities,	update	the	historical	earnings	of	its	UK	and	Canadian	operations	which	will	impact	the mandatory	repatriation	tax,	foreign	tax	credit	utilization,	carryforwards	and	valuation	allowance,	and	adjust	the	state	income	tax	expense.

Income	before	income	taxes	was	taxed	under	the	following	jurisdictions:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Domestic | $607.1 | \t $635.5 | \t $626.4 |
| Foreign | 53.2 | 36.9 | 20.6 |
| Total | $660.3 | \t $672.4 | \t $647.0 |

Components	of	Income	tax	expense	(benefit)	consist	of	the	following:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Current: |  |  |  |
| Federal | $258.9 | \t $295.7 | \t $258.5 |
| State | 29.8 | 34.9 | 28.6 |
| Foreign | 21.3 | 16.8 | 10.1 |
| Total\tcurrent | 310.0 | 347.4 | 297.2 |
| Deferred: |  |  |  |
| Domestic | (168.0) | (90.5) | (48.5) |
| Foreign | (4.7) | (8.9) | (4.8) |
| Total\tdeferred | (172.7) | (99.4) | (53.3) |
| Income\ttax\texpense | $137.3 | \t $248.0 | \t $243.9 |

The	reconciliation	between	the	statutory	tax	rate	expressed	as	a	percentage	of	income	before	income	taxes	and	the	effective	tax	rate	is	as	follows:

| Statutory	federal	income	tax	rate | $231.1 | 35.0	% 	 $ | 235.4 | 35.0	% 	 $ | 226.4 | 35.0	% |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| State\ttaxes,\tnet\tof\tfederal\teffect(1) | 18.3 | 2.8 | 17.8 | 2.6 | 16.5 | 2.6 |
| Excess\ttax\tbenefit\tof\tequity\tawards | (36.2) | (5.5) | (1.6) | (0.2) | — | — |
| Effect\tof\trates\tdifferent\tthan\tstatutory | (6.3) | (1.0) | (4.5) | (0.7) | (1.9) | (0.3) |
| Foreign\twithholding\ttax | 1.0 | 0.2 | 0.8 | 0.1 | 3.3 | 0.5 |
| Effect\tof\tUK\ttax\trate\tchange\ton\tdeferred\ttaxes | — | — | (1.5) | (0.2) | (4.0) | (0.6) |
| Effect\tof\tUS\tTax\tCuts\tand\tJobs\tAct\ton\tDeferred\tTaxes\nand\tMandatory\tRepatriation\tTax | (75.5) | (11.4) | — | — | — | — |
| Other | 4.9 | 0.7 | 1.6 | 0.3 | 3.6 | 0.5 |
| Effective\ttax\trate | \t $137.3 | 20.8\t% \t $ | 248.0 | 36.9\t% \t $ | 243.9 | 37.7\t% |

(1) The	impact	of	state	taxes	on	excess	tax	benefits	of	equity	awards	and	the	US	Tax	Cuts	and	Jobs	Act	are	presented	on	the	respective	separate	lines	in the	effective	tax	rate	reconciliation.

The	tax	effect	of	temporary	differences	that	give	rise	to	the	net	deferred	income	tax	liabilities	is	presented	below:

| (in	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Deferred\ttax\tassets: |  |  |
| Equity\tcompensation\tplans | \t $18.7 | \t $29.2 |
| Payroll\tand\tbenefits | 8.0 | 22.7 |
| Deferred\tinterest | 6.8 | 13.9 |
| Net\toperating\tloss\tand\tcredit\tcarryforwards,\tnet | 28.1 | 12.7 |
| Rent | 7.4 | 11.0 |
| Accounts\treceivable | 5.4 | 8.3 |
| Other | 8.0 | 6.2 |
| Trade\tcredits | 1.5 | 0.6 |
| Total\tdeferred\ttax\tassets | 83.9 | 104.6 |
| Deferred\ttax\tliabilities: |  |  |
| Software\tand\tintangibles | 194.5 | 337.4 |
| Deferred\tincome | 18.6 | 58.3 |
| International\tinvestments | 19.2 | 31.3 |
| Property\tand\tequipment | 20.4 | 30.3 |
| Other | 12.0 | 15.3 |
| Total\tdeferred\ttax\tliabilities | 264.7 | 472.6 |
| Deferred\ttax\tasset\tvaluation\tallowance | 15.5 | 1.2 |
| Net\tdeferred\ttax\tliabilities | \t $196.3 | \t $369.2 |

The	Company	has	state	and	international	income	tax	net	operating	losses	of	$29	million,	which	will	expire	at	various	dates	from	2025	through	2032	and	state and	international	tax	credit	carryforwards	of	$28	million,	which	expire	at	various	dates	from	2019	through	2027.

Due	to	the	nature	of	the	CDW	UK	acquisition,	the	Company	has	provided	US	income	taxes	of	$19	million	on	the	excess	of	the	financial	reporting	value	of	the investment	over	 the	corresponding	 tax	basis.	As	 the	Company	continues	 to	evaluate	 the	Tax	Cuts	and	Jobs	Act,	 the	Company	has	made	a	provisional determination	that	it	is	indefinitely	reinvested	in	its	UK	business,	and	therefore	will	not	provide	for	any	deferred	US	taxes	on	the	earnings	of	the	UK	business. The	Company	has	also	made	a	provisional	determination	that	it	is	not	permanently	reinvested	in	its	Canadian	business	and	therefore	has	recognized	deferred tax	liabilities	of	$3	million	as	of	December	31,	2017	related	to	withholding	taxes	on	earnings	of	its	Canadian	business.

In	the	ordinary	course	of	business,	the	Company	is	subject	to	review	by	domestic	and	foreign	taxing	authorities,	including	the	Internal	Revenue	Service ("IRS").	In	general,	the	Company	is	no	longer	subject	to	audit	by	the	IRS	for	tax	years	through	2013	and	state,	local	or	foreign	taxing	authorities	for	tax	years through	2012.	Various	other	taxing	authorities	are	in	the	process	of	auditing	income	tax	returns	of	the	Company	and	its	subsidiaries.	The	Company	does	not anticipate	that	any	adjustments	from	the	audits	would	have	a	material	impact	on	its	consolidated	financial	position,	results	of	operations	or	cash	flows.

# 12. Stockholders'	Equity

The	Company	has	a	share	repurchase	program	under	which	it	may	repurchase	shares	of	its	common	stock	in	the	open	market	or	through	privately	negotiated other	transactions,	depending	on	share	price,	market	conditions	and	other	factors.	The	share	repurchase	program	does	not	obligate	the	Company	to	repurchase any	dollar	amount	or	number	of	shares,	and	repurchases	may	be	commenced	or	suspended	from	time	to	time	without	prior	notice.

During	2017,	the	Company	repurchased	9	million	shares	of	its	common	stock	for	$534	million	under	the	previously	announced	$750	million	share	repurchase program.

On	August	3,	2017,	the	Company	announced	that	its	Board	of	Directors	authorized	a	$750	million	increase	to	the	Company's	share	repurchase	program.	As	of December	31,	2017,	the	Company	has	$858	million	remaining	under	this	program.

# Treasury	Stock

On	December	31,	2017,	the	Company	acquired	109,207	shares	of	its	common	stock,	which	are	held	as	treasury	stock.	The	shares	were	acquired	in	satisfaction of	withholding	taxes	on	behalf	of	employees	under	the	Performance	Share	Awards	("PSAs")	program.	Refer	to	Note	13	(Equity-Based	Compensation)	for additional	information	on	the	PSAs.

Equity-based	compensation	expense,	which	is	recorded	in	Selling	and	administrative	expenses	in	the	Consolidated	Statements	of	Operations	is	as	follows:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Equity-based\tcompensation\texpense | $43.7 | \t $39.2 | \t $31.2 |
| Income\ttax\tbenefit\t(1) | (15.3) | (13.3) | (10.9) |
| Equity-based\tcompensation\texpense\t(net\tof\ttax) | $28.4 | \t $25.9 | \t $20.3 |

(1) Represents	equity-based	compensation	tax	expense	at	the	statutory	tax	rates.	This	line	does	not	include	any	excess	tax	benefits	associated	with	equity awards	separately	disclosed	in	Note	11	(Income	Taxes).

The	 total	unrecognized	compensation	cost	related to	nonvested	awards	was	$32	 million	 at	December	31,	2017	and is	expected to	be	recognized	over	a weighted-average	period	of	1.6	years.

# 2013	Long-Term	Incentive	Plan

The	2013	Long-Term	Incentive	Plan	("2013	LTIP")	provides	for	the	grant	of	incentive	stock	options,	nonqualified	stock	options,	stock	appreciation	rights, restricted	stock,	restricted	stock	units,	bonus	stock	and	performance	awards.	The	maximum	aggregate	number	of	shares	that	may	be	issued	under	the	2013 LTIP	is	15,500,000	shares	of	the	Company's	common	stock,	in	addition	to	the	3,798,508	shares	of	restricted	stock	granted	in	exchange	for	unvested	Class B	Common	Units	in	connection	with	the	Company's	IPO.	As	of	December	31,	2017,	6,416,547	shares	were	available	for	issuance	under	the	2013	LTIP	which was	approved	by	the	Company's	pre-IPO	shareholders.	Authorized	but	unissued	shares	are	reserved	for	issuance	in	connection	with	equity-based	awards.

# Stock	Options

The	exercise	price	of	a	stock	option	granted	is	equal	to	the	fair	value	of	the	underlying	stock	on	the	date	of	the	grant.	Stock	options	have	a	contractual	term	of 10	years	and	generally	vest	ratably	over	three	years.	To	estimate	the	fair	value	of	options	granted,	the	Company	uses	the	Black-Scholes	option	pricing	model. The	weighted-average	assumptions	used	to	value	the	stock	options	granted	were	as	follows:

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Grant\tdate\tfair\tvalue | \t $12.27 | \t $8.55 | \t $11.13 |
| Volatility\t(1) | 22.00% | 25.00% | 30.00% |
| Risk-free\trate\t(2) | 2.08% | 1.47% | 1.75% |
| Expected\tdividend\tyield | 1.09% | 1.08% | 0.72% |
| Expected\tterm\t(in\tyears)\t(3) | 6.0 | 6.0 | 6.0 |

(1) Based	upon	an	assessment	of	the	two-year	and	five-year	historical	volatility	and	implied	volatility	for	the	Company's	selected	peer	group,	adjusted	for the	Company's	leverage.

(2) Based on a composite	 US	 Treasury rate.

(3) Calculated	using	the	simplified	method,	which	defines	the	expected	term	as	the	average	of	the	option's	contractual	term	and	the	option's	weighted- average	vesting	period.	The	Company	utilizes	this	method	as	it	has	limited	historical	stock	option	data	that	is	sufficient	to	derive	a	reasonable	estimate of	the	expected	stock	option	term.

Stock	option	activity	for	the	year	ended	December	31,	2017	was	as	follows:

| Options | Number	of	Options | Weighted-Average<br>Exercise	Price | Weighted-Average<br>Remaining	Contractual<br>Term	(years) | Aggregate	Intrinsic<br>Value	(millions) |
| :--- | :--- | :--- | :--- | :--- |
| Outstanding\tat\tJanuary\t1,\t2017 | 3,781,051 | \t $29.36 |  |  |
| Granted | 1,213,299 | 58.97 |  |  |
| Forfeited/Expired | (59,834) | 45.76 |  |  |
| Exercised(1) | (476,520) | 27.37 |  |  |
| Outstanding\tat\tDecember\t31,\t2017 | 4,457,996 | \t $37.41 | 7.21 | \t $143.0 |
| Vested\tand\texercisable\tat\tDecember\t31,\t2017 | 2,372,046 | \t $25.90 | 5.97 | \t $103.4 |
| Expected\tto\tvest\tat\tDecember\t31,\t2017 | 2,056,814 | \t $50.44 | 8.61 | \t $39.2 |

(1) The	total	intrinsic	value	of	stock	options	exercised	during	the	years	ended	December	31,	2017,	2016	and	2015	was	$17	million,	$7	million and	$2 million,	respectively.

# Restricted	Stock	Units	("RSUs")

Restricted	stock	units	represent	the	right	to	receive	unrestricted	shares	of	the	Company's	stock	at	the	time	of	vesting.	RSUs	generally	cliff-vest	at	the	end	of four	years.	The	fair	value	of	RSUs	is	equal	to	the	closing	price	of	the	Company's	common	stock	on	date	of	grant.

RSU	activity	for	the	year	ended	December	31,	2017	was	as	follows:

|  | Number	of	Units | Weighted-Average<br>Grant-Date	Fair	Value |
| :--- | :--- | :--- |
| Nonvested\tat\tJanuary\t1,\t2017 | 1,179,488 | \t $19.52 |
| Granted\t(1) | 25,493 | 58.90 |
| Vested\t(2) | (1,032,821) | 17.77 |
| Forfeited | (41,091) | 23.00 |
| Nonvested\tat\tDecember\t31,\t2017 | 131,069 | \t $40.11 |

(2) The	aggregate	fair	value	of	RSUs	that	vested	during	the	years	ended	December	31,	2017,	2016	and	2015	was	$18	million,	$1	million	and	$1	million, respectively.

# Performance	Share	Units	("PSUs")

Performance	share	units	represent	the	right	to	receive	unrestricted	shares	of	the	Company's	stock	at	the	time	of	vesting.	PSUs	are	granted	under	the	2013	LTIP which	cliff-vest	at	the	end	of	three	years.	The	percentage	of	PSUs	that	shall	vest	will	range	from	0%	to	200%	of	the	number	of	PSUs	granted	based	on	the Company's	performance	against	a	cumulative	adjusted	free	cash	flow	measure	and	cumulative	non-GAAP	net	income	per	diluted	share	measure	over	a	three- year	performance	period.

PSU	activity	for	the	year	ended	December	31,	2017	was	as	follows:

|  | Number	of	Units | Weighted-Average<br>Grant-Date	Fair	Value |
| :--- | :--- | :--- |
| Nonvested\tat\tJanuary\t1,\t2017\nGranted\t(1) | 363,947 | \t $38.92 |
|  | 254,451 | 59.00 |
| Attainment\tAdjustment\t(2)\nVested\t(3) | 361,880 | 24.40 |
|  | (530,569) | 37.84 |
| Forfeited | (30,736) | 47.28 |
| Nonvested\tat\tDecember\t31,\t2017 | 418,973 | \t $50.75 |

(2) During	the	year	ended	December	31,	2017,	the	attainment	on	PSUs	vested	at	December	31,	2016	was	adjusted	to	reflect	actual	performance.	The weighted-average	grant	date	fair	value	of	PSUs	included	in	the	attainment	adjustment	is	$24.40.

(3) The	aggregate	fair	value	of	PSUs	that	vested	during	the	years	ended	December	31,	2017	and	2016	was	$20	million	and	$9	million,	respectively.	No PSUs	vested	during	the	year	ended	December	31,	2015.

# Performance	Share	Awards	("PSAs")

Performance	share	awards	represent	the	right	to	receive	unrestricted	shares	of	the	Company's	stock	at	the	time	of	vesting.	PSAs	are	granted	under	the	2013 LTIP	which	cliff-vest	at	the	end	of	three	years.	The	percentage	of	PSAs	that	shall	vest	will	range	from	0%	to	200%	of	the	number	of	PSAs	granted	based	on	the Company's	performance	against	a	cumulative	adjusted	free	cash	flow	measure	and	cumulative	non-GAAP	net	income	per	diluted	share	measure	over	a	three- year	performance	period.

PSA	activity	for	the	year	ended	December	31,	2017	was	as	follows:

|  | Number	of	Units | Weighted-Average<br>Grant-Date	Fair	Value |
| :--- | :--- | :--- |
| Nonvested\tat\tJanuary\t1,\t2017\nGranted\t(1) | 246,012 | \t $38.96 |
|  | 2,714 | — |
| Vested\t(2) |  |  |
|  | (121,266) | 37.79 |
| Forfeited | (4,993) | 39.79 |
| Nonvested\tat\tDecember\t31,\t2017 | 122,467 | \t $40.08 |

(1) The	weighted-average	grant	date	fair	value	of	PSAs	granted	during	the	year	ended	December	31,	2017	was	zero	as	the	units	granted	consisted	of	only dividends	on	previously	granted	units.	The	weighted-average	grant	date	fair	value	of	PSAs	granted	during	the	years	ended	December	31,	2016	and 2015	was	$40.06	and	$37.79,	respectively.

(2) The	aggregate	fair	value	of	PSAs	that	vested	during	the	year	ended	December	31,	2017	 was	$5	million.	No	PSAs	vested	during	the	years	ended December	31,	2016	and	2015.

# Restricted	Stock	("RSAs")

In	connection	with	the	IPO,	the	Company	issued	restricted	shares	of	the	Company's	common	stock	to	former	stockholders	of	CDW	Holdings.	These	shares	are subject	to	any	vesting	provisions	previously	applicable	to	the	restrictions	associated	with	the	stock	of	CDW	Holdings.	Class	B	Common	Unit	holders	received 3,798,508	shares	of	restricted	stock	with	respect	to	Class	B	Common	Units	that	had	not	yet	vested	at	the	time	of	the	issuance.

RSA	activity	for	the	year	ended	December	31,	2017	was	as	follows:

|  | Number	of	Units | Weighted-Average<br>Grant-Date	Fair	Value |
| :--- | :--- | :--- |
| Nonvested\tat\tJanuary\t1,\t2017 | 26,052 | \t $17.00 |
| Granted | — | — |
| Vested(1) | (25,398) | 17.00 |
| Forfeited | (654) | 17.00 |
| Nonvested\tat\tDecember\t31,\t2017 | — | \t $— |

(1) The	aggregate	fair	value	of	restricted	stock	that	vested	during	the	years	ended	December	31,	2017,	2016	and	2015	was	less	than	$1	million,	$1	million and	$3	million,	respectively.

# Equity	Awards	Granted	by	Seller	of	CDW	UK

The	Company	issued	1,634,809	shares	of	CDW	common	stock	as	part	of	the	consideration	transferred	to	certain	sellers	for	the	acquisition	of	CDW	UK.	One	of the	sellers	granted	608,706	stock	options	to	certain	CDW	UK	coworkers	over	his	shares	of	CDW	common	stock	received	in	this	transaction.	The	options	are not	dilutive	for	purposes	of	calculating	diluted	weighted-average	shares	outstanding	as	the	underlying	shares	were	issued	as	part	of	the	consideration	transferred and	are	included	within	basic	weighted-average	shares	outstanding	since	the	acquisition	date.	The	weighted	average	grant	date	fair	value	of	the	stock	options was	$22	million	or	$35.93	per	option.	The	grant	date	fair	value	of	the	options	was	determined	by	calculating	the	fair	value	of	the	common	stock	that	was	issued which	will	eventually	settle	these	options.	The	exercise	price	of	these	stock	options	is	$0.01.	The	fair	value	of	these	stock	options	has	been	accounted	for	as post-combination	stock-based	compensation,	as	service	is	required	for	the	coworkers	to	retain	the	awards,	and	is	being	amortized	over	the	weighted-average requisite	service	period.	Options	that	are	forfeited	prior	to	vesting	will	not	be	available	for	future	option	issuances	and	will	revert	as	consideration	to	the	seller. For	further	information	regarding	the	acquisition,	see	Note	3	(Acquisition).

# 14. Earnings Per Share

The	numerator	for	both	basic	and	diluted	earnings	per	share	is	Net	income.	The	denominator	for	basic	earnings	per	share	is	the	weighted-average	shares outstanding	during	the	period.

A	reconciliation	of	basic	weighted-average	shares	outstanding	to	diluted	weighted-average	shares	outstanding	is	as	follows:

| (in	millions) | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Basic\tweighted-average\tshares\toutstanding | 155.4 | 163.6 | 170.3 |
| Effect\tof\tdilutive\tsecurities\t(1) | 2.8 | 2.4 | 1.5 |
| Diluted\tweighted-average\tshares\toutstanding\t(2) | 158.2 | 166.0 | 171.8 |

(1) The	dilutive	effect	of	outstanding	stock	options,	restricted	stock	units,	restricted	stock,	performance	share	units	and	Coworker	Stock	Purchase	Plan units	is	reflected	in	the	diluted	weighted-average	shares	outstanding	using	the	treasury	stock	method.

(2) There	were	less	than	1	million	potential	common	shares	excluded	from	diluted	weighted-average	shares	outstanding	for	the	years	ended	December	31, 2017,	2016	and	2015,	respectively,	as	their	inclusion	would	have	had	an	anti-dilutive	effect.

# 15. Coworker	Retirement	and	Other	Compensation	Benefits

# Profit	Sharing	Plan	and	Other	Savings	Plans

The	 Company	 has	 a	 profit	 sharing	 plan	 that	 includes	 a	 salary	 reduction	 feature	 established	 under	 the	 Internal	 Revenue	 Code	 Section	 401(k)	 covering substantially	all	coworkers	in	the	US.	In	addition,	coworkers	outside	the	US	participate	in	other	savings	plans.	Company	contributions	to	the	profit	sharing	and other	savings	plans	are	made	in	cash	and	determined

at	the	discretion	of	the	Board	of	Directors.	For	the	years	ended	December	31,	2017,	2016	and	2015,	the	amounts	expensed	for	these	plans	were	$20	million,	$23 million	and	$20	million,	respectively.

# Coworker	Stock	Purchase	Plan

The	Company	has	a	Coworker	Stock	Purchase	Plan	(the	"CSPP")	that	provides	the	opportunity	for	eligible	coworkers	to	acquire	shares	of	the	Company's common	stock	at	a	5%	discount	from	the	closing	market	price	on	the	final	day	of	the	offering	period.	There	is	no	compensation	expense	associated	with	the CSPP.

# Restricted	Debt	Unit	Plan

On	March	10,	2010,	 the	Company	established	 the	Restricted	Debt	Unit	Plan	(the	"RDU	Plan"),	an	unfunded	nonqualified	deferred	compensation	plan. Compensation	expense	related	to	the	RDU	Plan	was	$2	million,	$2	million	and	$5	million	for	the	years	ended	December	31,	2017,	2016	and	2015,	respectively. On	September	15,	2017,	the	Company	settled	the	RDU	Plan.	The	total	payment	made	on	September	15,	2017	was	$31	million,	which	settled	the	obligation	in full.

The	 Company	 is	 party	 to	 various	 legal	 proceedings	 that	 arise	 in	 the	 ordinary	 course	 of	 its	 business,	 which	 include	 commercial,	 intellectual	 property, employment,	tort	and	other	litigation	matters.	The	Company	is	also	subject	to	audit	by	federal,	state,	international,	national,	provincial	and	local	authorities,	and by	various	partners,	group	purchasing	organizations	and	customers,	including	government	agencies,	relating	to	purchases	and	sales	under	various	contracts.	In addition,	the	Company	is	subject	to	indemnification	claims	under	various	contracts.	From	time	to	time,	certain	customers	of	the	Company	file	voluntary petitions	for	reorganization	or	liquidation	under	the	US	bankruptcy	laws	or	similar	laws	of	the	jurisdictions	for	the	Company's	business	activities	outside	of	the US.	In	such	cases,	certain	pre-petition	payments	received	by	the	Company	could	be	considered	preference	items	and	subject	to	return	to	the	bankruptcy administrator.

As	of	December	31,	2017,	the	Company	does	not	believe	that	there	is	a	reasonable	possibility	that	any	material	loss	exceeding	the	amounts	already	recognized for	these	proceedings	and	matters,	if	any,	has	been	incurred.	However,	the	ultimate	resolutions	of	these	proceedings	and	matters	are	inherently	unpredictable. As	such,	the	Company's	financial	condition	and	results	of	operations	could	be	adversely	affected	in	any	particular	period	by	the	unfavorable	resolution	of	one	or more	of	these	proceedings	or	matters.

On	October	29,	2015,	the	Company	learned	of	an	investigation	by	the	SEC	of	the	Company's	vendor	partner	program	incentives.	On	May	19,	2017,	the	SEC Staff	informed	the	Company	that	the	SEC	has	concluded	its	investigation	and	does	not	intend	to	recommend	an	enforcement	action.	The	investigation	did	not have	any	impact	on	the	Company's	financial	condition	or	result	of	operations	other	than	customary	costs	related	to	the	Company's	cooperation	with	the investigation.

# 17.				Related	Party	Transactions

The	Company	held	a	35%	non-controlling	interest	in	CDW	UK	until	August	1,	2015	when	the	Company	purchased	the	remaining	65%	of	its	outstanding common	stock.	The	Company	recorded	$10	million	in	Net	sales	to	CDW	UK	during	the	normal	course	of	business	in	2015	prior	to	the	acquisition	of	CDW	UK.

On	November	30,	2015,	the	Company	completed	a	public	offering	of	9.2	million	shares	of	its	common	stock	by	certain	selling	stockholders,	which	included	1.2 million	shares	sold	by	the	selling	stockholders	to	the	underwriters	pursuant	to	the	grant	of	an	option	that	was	exercised	in	full.	The	Company	did	not	receive any	proceeds	from	the	sale	of	these	shares.	Upon	completion	of	this	offering,	the	Company	purchased	from	the	underwriters	1.0	million	of	the	shares	of	its common	stock	that	were	subject	to	the	offering	at	a	price	per	share	equal	to	the	price	paid	by	the	underwriters	to	the	selling	stockholders	in	the	offering.

On	August	18,	2015,	the	Company	completed	a	public	offering	of	approximately	12.9	million	shares	of	its	common	stock	by	certain	selling	stockholders, which	 included	1.7	million	shares	sold	by	the	selling	stockholders	to	the	underwriters	pursuant	to	the	grant	of	an	option	that	was	exercised	in	full.	The Company	did	not	receive	any	proceeds	from	the	sale	of	these	shares.	Upon	completion	of	this	offering,	the	Company	purchased	from	the	underwriters	2.3 million	of	the	shares	of	its	common	stock	that	were	subject	to	the	offering	at	a	price	per	share	equal	to	the	price	paid	by	the	underwriters	to	the	selling stockholders	in	the	offering.

On	May	22,	2015,	the	Company	completed	a	public	offering	of	11.5	million	shares	of	its	common	stock	by	certain	selling	stockholders,	which	included	1.5 million	shares	sold	by	the	selling	stockholders	to	the	underwriters	pursuant	to	the	grant

of	an	option	that	was	exercised	in	full.	The	Company	did	not	receive	any	proceeds	from	the	sale	of	these	shares.	On	May	17,	2015,	the	Company	entered	into	a share	repurchase	agreement	with	certain	selling	stockholders	affiliated	with	Madison	Dearborn	and	Providence	Equity	pursuant	to	which	it	repurchased	2.0 million	shares	of	its	common	stock	from	such	selling	stockholders.	This	share	repurchase	was	effected	in	a	private,	non-underwritten	transaction	for	$36.60	per share,	which	was	equal	to	the	per	share	price	paid	by	the	underwriters	to	the	selling	stockholders	in	connection	with	the	public	offering	completed	on	May	22, 2015.

# 18.				Segment	Information

The	Company's	segment	information	is	presented	in	accordance	with	a	"management	approach,"	which	designates	the	internal	reporting	used	by	the	Chief Operating	Decision-Maker	for	deciding	how	to	allocate	resources	and	for	assessing	performance.

The	Company	has	three	reportable	segments:	Corporate,	which	is	comprised	primarily	of	private	sector	business	customers	with	more	than	250	employees	in the	US,	Small	Business,	primarily	servicing	private	sector	business	customers	with	up	 to	250	employees	 in	 the	US,	and	Public,	which	 is	comprised	of government	agencies	and	education	and	healthcare	institutions	in	the	US.	The	Company	has	two	other	operating	segments:	CDW	Canada	and	CDW	UK,	both of	which	do	not	meet	the	reportable	segment	quantitative	thresholds	and,	accordingly,	are	included	in	an	all	other	category	("Other").	Effective	January	1, 2016,	CDW	Advanced	Services	is	no	longer	an	operating	segment.	Its	results	have	been	allocated	to	the	Corporate,	Small	Business	and	Public	segments	to	align the	 Company's	 financial	 reporting	 with	 the	 manner	 in	 which	 the	 Chief	 Operating	 Decision-Maker	 assesses	 performance	 and	 makes	 resource	 allocation decisions.	Segment	information	reported	in	prior	periods	has	been	reclassified	to	conform	to	the	current	period	presentation.

The	 Company	 has	 centralized	 logistics	 and	 headquarters	 functions	 that	 provide	 services	 to	 the	 segments.	 The	 logistics	 function	 includes	 purchasing, distribution	and	fulfillment	services	to	support	the	Corporate,	Small	Business	and	Public	segments.	As	a	result,	costs	and	intercompany	charges	associated	with the	logistics	function	are	fully	allocated	to	both	of	these	segments	based	on	a	percent	of	Net	sales.	The	centralized	headquarters	function	provides	services	in areas	such	as	accounting,	information	technology,	marketing,	legal	and	coworker	services.	Headquarters'	function	costs	that	are	not	allocated	to	the	segments are	included	under	the	heading	of	"Headquarters"	in	the	tables	below.

The	Company	allocates	resources	to	and	evaluates	performance	of	its	segments	based	on	Net	sales,	Income	from	operations	and	Adjusted	EBITDA,	a	non- GAAP	measure	as	defined	in	the	Company's	credit	agreements.	However,	the	Company	has	concluded	that	Income	from	operations	is	the	more	useful	measure in	terms	of	discussion	of	operating	results,	as	it	is	a	GAAP	measure.

Segment	information	for	Total	assets	and	capital	expenditures	is	not	presented,	as	such	information	is	not	used	in	measuring	segment	performance	or	allocating resources	between	segments.

# Selected	Segment	Financial	Information

Information	regarding	the	Company's	segments	for	the	years	ended	December	31,	2017,	2016	and	2015	is	as	follows:

| (in	millions) | Corporate	(1) | Small<br>Business	(1) | Public | Other | Headquarters | Total |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| 2017: |  |  |  |  |  |  |
| Net\tsales | $6,347.0 | \t $1,246.5 | \t $6,037.5 | \t $1,560.5 | \t $— | \t $15,191.5 |
| Income\t(loss)\tfrom\toperations | 487.0 | 74.4 | 374.0 | 57.9 | (127.2) | 866.1 |
| Depreciation\tand\tamortization\texpense | (83.1) | (20.7) | (44.8) | (30.9) | (81.4) | (260.9) |
| 2016: |  |  |  |  |  |  |
| Net\tsales | $5,889.8 | \t $1,140.1 | \t $5,589.4 | \t $1,362.6 | \t $— | \t $13,981.9 |
| Income\t(loss)\tfrom\toperations | 453.6 | 68.9 | 368.0 | 43.6 | (114.9) | 819.2 |
| Depreciation\tand\tamortization\texpense | (82.9) | (20.6) | (44.7) | (32.1) | (74.2) | (254.5) |
| 2015: |  |  |  |  |  |  |
| Net\tsales | $5,878.7 | \t $1,089.6 | \t $5,183.6 | \t $836.8 | \t $— | \t $12,988.7 |
| Income\t(loss)\tfrom\toperations | 432.5 | 68.3 | 328.6 | 27.1 | (114.5) | 742.0 |
| Depreciation\tand\tamortization\texpense | (82.6) | (20.6) | (44.7) | (16.2) | (63.3) | (227.4) |

# Geographic	Areas	and	Revenue	Mix

The	Company	did	not	have	Net	sales	to	individual	countries	outside	of	the	US	exceeding	10%	of	the	Company's	total	Net	sales	in	2017,	2016	or	2015.	The Company	did	not	have	long-lived	assets	located	in	individual	countries	outside	of	the	US	exceeding	10%	of	the	Company's	total	long-lived	assets	as	of December	31,	2017	or	2016.

The	 following table	 presents	 Net	 sales	 by	 major	 category for the	 years	 ended	December	 31,	 2017,	 2016	 and	 2015.	 Categories	 are	 based	 upon internal classifications.

|  | Year	Ended<br>December	31,	2017 |  | Year	Ended<br>December	31,	2016	(1) |  | Year	Ended<br>December	31,	2015	(1) |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Dollars\tin\nMillions | Percentage\nof\tTotal\tNet\nSales | Dollars\tin\nMillions | Percentage\nof\tTotal\tNet\nSales | Dollars\tin\nMillions | Percentage\nof\tTotal\tNet\nSales |
| Notebooks/Mobile\tDevices | $3,490.9 | 23.1% | \t $2,921.6 | 20.9% | \t $2,537.3 | 19.5% |
| Netcomm\tProducts | 2,042.9 | 13.4 | 1,958.2 | 14.0 | 1,915.0 | 14.7 |
| Desktops | 1,159.4 | 7.6 | 1,050.0 | 7.5 | 965.6 | 7.4 |
| Video | 1,076.9 | 7.1 | 962.1 | 6.9 | 853.8 | 6.6 |
| Enterprise\tand\tData\tStorage\n(Including\tDrives) | 1,071.5 | 7.1 | 1,053.1 | 7.5 | 1,067.2 | 8.2 |
| Other\tHardware | 3,100.3 | 20.4 | 3,042.6 | 21.8 | 2,950.5 | 22.7 |
| Total\tHardware | 11,941.9 | 78.7 | 10,987.6 | 78.6 | 10,289.4 | 79.1 |
| Software | 2,540.1 | 16.7 | 2,389.3 | 17.1 | 2,152.3 | 16.6 |
| Services(2) | 611.3 | 4.0 | 575.1 | 4.1 | 467.7 | 3.6 |
| Other\t(3) | 98.2 | 0.6 | 29.9 | 0.2 | 79.3 | 0.7 |
| Total\tNet\tsales | $15,191.5 | 100.0% | \t $13,981.9 | 100.0% | \t $12,988.7 | 100.0% |

(2) Certain	 software	 and	 services	 revenue	 are	 recorded	 on	 a	 net	 basis	 for	 accounting	 purposes,	 so the	 category	 percentage	 of	 net	 revenues is	 not representative	of	the	category	percentage	of	gross	profits.

# 19.				Supplemental	Guarantor	Information

The	2023	Senior	Notes,	the	2024	Senior	Notes	and	the	2025	Senior	Notes	are,	and,	prior	to	being	redeemed	in	full,	the	2022	Senior	Notes	were,	guaranteed	by the	Parent	and	each	of	CDW	LLC's	direct	and	indirect,	100%	owned,	domestic	subsidiaries	(the	"Guarantor	Subsidiaries").	All	guarantees	by	the	Parent	and the	Guarantor	Subsidiaries	are	and	were	joint	and	several,	and	full	and	unconditional;	provided	that	guarantees	by	the	Guarantor	Subsidiaries	(i)	are	subject	to certain	customary	release	provisions	contained	in	the	indentures	governing	the	2023	Senior	Notes,	the	2024	Senior	Notes	and	the	2025	Senior	Notes	and	(ii) were	subject	 to	certain	customary	release	provisions	contained	 in	 the	 indenture	governing	 the	2022	Senior	Notes	until	such	 indenture	was	satisfied	and discharged	during	2017.	CDW	LLC's	100%	owned	foreign	subsidiaries,	CDW	International	Holdings	Limited,	which	is	comprised	of	CDW	UK	and	CDW Canada	(together	the	"Non-Guarantor	Subsidiaries"),	do	not	guarantee	the	debt	obligations.	CDW	LLC	and	CDW	Finance	Corporation,	as	co-issuers,	are 100%	owned	by	Parent	and	each	of	the	Guarantor	Subsidiaries	and	the	Non-Guarantor	Subsidiaries	are,	directly	or	indirectly,	100%	owned	by	CDW	LLC.

The	following	tables	set	forth	Condensed	Consolidating	Balance	Sheets	as	of	December	31,	2017	and	2016,	Consolidating	Statements	of	Operations	for	the years	ended	December	31,	2017,	2016	and	2015,	Condensed	Consolidating	Statements	of	Comprehensive	Income	for	the	years	ended	December	31,	2017,	2016 and	2015,	and	Condensed	Consolidating	Statements	of	Cash	Flows	for	the	years	ended	December	31,	2017,	2016	and	2015,	in	accordance	with	Rule	3-10	of Regulation	S-X.	The	consolidating	financial	information	includes	the	accounts	of	CDW	Corporation	(the	"Parent	Guarantor"),	which	has	no	independent	assets or	operations,	the	accounts	of	CDW	LLC	(the	"Subsidiary	Issuer"),	the	combined	accounts	of	the	Guarantor	Subsidiaries,	the	combined	accounts	of	the	Non- Guarantor	Subsidiaries,	and	the

accounts	of	CDW	Finance	Corporation	(the	"Co-Issuer")	for the	periods indicated.	The information	was	prepared	on the	same	basis	as the	Company's Consolidated	Financial	Statements.

# Condensed	Consolidating	Balance	Sheet

| (in	millions) | Parent<br>Guarantor | Subsidiary<br>Issuer | Guarantor<br>Subsidiaries | Non-Guarantor<br>Subsidiaries | Co-Issuer | Consolidating<br>Adjustments | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Assets |  |  |  |  |  |  |  |
| Current\tassets: |  |  |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $— | $113.7 | $— | $32.4 | $— | $(1.9) | $144.2 |
| Accounts\treceivable,\tnet | — | — | 2,007.7 | 312.8 | — | — | 2,320.5 |
| Merchandise\tinventory | — | — | 375.7 | 73.8 | — | — | 449.5 |
| Miscellaneous\treceivables | — | 103.9 | 205.0 | 27.6 | — | — | 336.5 |
| Prepaid\texpenses\tand\tother | — | 18.0 | 61.4 | 48.0 | — | — | 127.4 |
| Total\tcurrent\tassets | — | 235.6 | 2,649.8 | 494.6 | — | (1.9) | 3,378.1 |
| Property\tand\tequipment,\tnet | — | 95.0 | 43.5 | 22.6 | — | — | 161.1 |
| Goodwill | — | 751.8 | 1,439.0 | 288.8 | — | — | 2,479.6 |
| Other\tintangible\tassets,\tnet | — | 280.1 | 424.5 | 192.4 | — | — | 897.0 |
| Other\tassets | 1.7 | 30.7 | 217.3 | 2.6 | — | (211.5) | 40.8 |
| Investment\tin\tand\tadvances\tto\nsubsidiaries | 981.2 | 3,063.5 | — | — | — | (4,044.7) | — |
| Total\tAssets | $982.9 | $4,456.7 | $4,774.1 | $1,001.0 | $— | $(4,258.1) | $6,956.6 |
| Liabilities\tand\tStockholders'\tEquity |  |  |  |  |  |  |  |
| Current\tliabilities: |  |  |  |  |  |  |  |
| Accounts\tpayable-trade | $— | $42.5 | $1,112.1 | $165.0 | $— | $(1.9) | $1,317.7 |
| Accounts\tpayable-inventory\nfinancing | — | 1.0 | 480.9 | 16.1 | — | — | 498.0 |
| Current\tmaturities\tof\tlong-term\tdebt | — | 14.9 | 3.8 | 6.8 | — | — | 25.5 |
| Deferred\trevenue | — | — | 104.5 | 89.5 | — | — | 194.0 |
| Accrued\texpenses | — | 173.3 | 222.3 | 83.8 | — | — | 479.4 |
| Total\tcurrent\tliabilities | — | 231.7 | 1,923.6 | 361.2 | — | (1.9) | 2,514.6 |
| Long-term\tliabilities: |  |  |  |  |  |  |  |
| Debt | — | 3,134.2 | 8.3 | 67.5 | — | — | 3,210.0 |
| Deferred\tincome\ttaxes | — | 66.5 | 100.1 | 31.4 | — | (1.7) | 196.3 |
| Other\tliabilities | — | 43.1 | 4.6 | 214.9 | — | (209.8) | 52.8 |
| Total\tlong-term\tliabilities | — | 3,243.8 | 113.0 | 313.8 | — | (211.5) | 3,459.1 |
| Total\tstockholders'\tequity | 982.9 | 981.2 | 2,737.5 | 326.0 | — | (4,044.7) | 982.9 |
| Total\tLiabilities\tand\tStockholders' | $982.9 | $4,456.7 | $4,774.1 | $1,001.0 | $— | $(4,258.1) | $6,956.6 |

| (in	millions) | Parent<br>Guarantor | Subsidiary<br>Issuer | Guarantor<br>Subsidiaries | Non-Guarantor<br>Subsidiaries | Co-Issuer | Consolidating<br>Adjustments | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Assets |  |  |  |  |  |  |  |
| Current\tassets: |  |  |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $— | $222.7 | $3.1 | $37.9 | $— | $— | $263.7 |
| Accounts\treceivable,\tnet | — | — | 1,904.9 | 263.7 | — | — | 2,168.6 |
| Merchandise\tinventory | — | — | 390.6 | 61.4 | — | — | 452.0 |
| Miscellaneous\treceivables | — | 92.6 | 130.1 | 12.2 | — | — | 234.9 |
| Prepaid\texpenses\tand\tother | — | 14.3 | 69.0 | 35.6 | — | — | 118.9 |
| Total\tcurrent\tassets | — | 329.6 | 2,497.7 | 410.8 | — | — | 3,238.1 |
| Property\tand\tequipment,\tnet | — | 105.6 | 49.3 | 8.8 | — | — | 163.7 |
| Goodwill | — | 751.8 | 1,439.0 | 264.2 | — | — | 2,455.0 |
| Other\tintangible\tassets,\tnet | — | 291.5 | 565.1 | 199.0 | — | — | 1,055.6 |
| Other\tassets | 3.2 | 19.4 | 248.2 | 1.5 | — | (236.3) | 36.0 |
| Investment\tin\tand\tadvances\tto\nsubsidiaries | 1,042.3 | 3,026.5 | — | — | — | (4,068.8) | — |
| Total\tAssets | $1,045.5 | $4,524.4 | $4,799.3 | $884.3 | $— | $(4,305.1) | $6,948.4 |
| Liabilities\tand\tStockholders'\tEquity |  |  |  |  |  |  |  |
| Current\tliabilities: |  |  |  |  |  |  |  |
| Accounts\tpayable-trade | $— | $25.9 | $895.3 | $151.7 | $— | $— | $1,072.9 |
| Accounts\tpayable-inventory\nfinancing | — | 1.2 | 559.5 | 19.7 | — | — | 580.4 |
| Current\tmaturities\tof\tlong-term\ndebt | — | 14.9 | 3.6 | — | — | — | 18.5 |
| Deferred\trevenue | — | — | 100.8 | 71.8 | — | — | 172.6 |
| Accrued\texpenses | — | 173.9 | 214.8 | 47.7 | — | (0.1) | 436.3 |
| Total\tcurrent\tliabilities | — | 215.9 | 1,774.0 | 290.9 | — | (0.1) | 2,280.7 |
| Long-term\tliabilities: |  |  |  |  |  |  |  |
| Debt | — | 3,136.3 | 12.1 | 67.5 | — | — | 3,215.9 |
| Deferred\tincome\ttaxes | — | 99.1 | 205.4 | 67.9 | — | (3.2) | 369.2 |
| Other\tliabilities | — | 30.8 | 3.6 | 235.7 | — | (233.0) | 37.1 |
| Total\tlong-term\tliabilities | — | 3,266.2 | 221.1 | 371.1 | — | (236.2) | 3,622.2 |
| Total\tstockholders'\tequity | 1,045.5 | 1,042.3 | 2,804.2 | 222.3 | — | (4,068.8) | 1,045.5 |
| Total\tLiabilities\tand\tStockholders'\nEquity | $1,045.5 | $4,524.4 | $4,799.3 | $884.3 | $— | $(4,305.1) | $6,948.4 |

# Consolidating	Statement	of	Operations

|  |  | Year	Ended	December	31,	2017 | Year	Ended	December	31,	2017 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tsales | $— | $— | $13,631.0 | $1,560.5 | $— | $— | $15,191.5 |
| Cost\tof\tsales | — | — | 11,436.1 | 1,305.5 | — | — | 12,741.6 |
| Gross\tprofit | — | — | 2,194.9 | 255.0 | — | — | 2,449.9 |
| Selling\tand\tadministrative\texpenses | — | 127.2 | 1,093.1 | 189.8 | — | — | 1,410.1 |
| Advertising\texpense | — | — | 166.4 | 7.3 | — | — | 173.7 |
| Income\t(loss)\tfrom\toperations | — | (127.2) | 935.4 | 57.9 | — | — | 866.1 |
| Interest\t(expense)\tincome,\tnet | — | (148.3) | 4.1 | (6.3) | — | — | (150.5) |
| Net\tloss\ton\textinguishments\tof\tlong-term\ndebt | — | (57.4) | — | — | — | — | (57.4) |
| Other\tincome\t(expense),\tnet | — | (0.1) | 0.7 | 1.5 | — | — | 2.1 |
| Income\t(loss)\tbefore\tincome\ttaxes | — | (333.0) | 940.2 | 53.1 | — | — | 660.3 |
| Income\ttax\t(expense)\tbenefit | (0.9) | 149.9 | (269.7) | (16.6) | — | — | (137.3) |
| Income\t(loss)\tbefore\tequity\tin\tearnings\tof\nsubsidiaries | (0.9) | (183.1) | 670.5 | 36.5 | — | — | 523.0 |
| Equity\tin\tearnings\tof\tsubsidiaries | 523.9 | 707.0 | — | — | — | (1,230.9) | — |
| Net\tincome | $523.0 | $523.9 | $670.5 | $36.5 | $— | $(1,230.9) | $523.0 |

|  |  | Year	Ended	December	31,	2016 | Year	Ended	December	31,	2016 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tsales | $— | $— | $12,619.3 | $1,362.6 | $— | $— | $13,981.9 |
| Cost\tof\tsales | — | — | 10,514.4 | 1,140.3 | — | — | 11,654.7 |
| Gross\tprofit | — | — | 2,104.9 | 222.3 | — | — | 2,327.2 |
| Selling\tand\tadministrative\texpenses | — | 114.8 | 1,057.4 | 172.9 | — | — | 1,345.1 |
| Advertising\texpense | — | — | 157.2 | 5.7 | — | — | 162.9 |
| Income\t(loss)\tfrom\toperations | — | (114.8) | 890.3 | 43.7 | — | — | 819.2 |
| Interest\t(expense)\tincome,\tnet | — | (145.8) | 6.7 | (7.4) | — | — | (146.5) |
| Net\tloss\ton\textinguishments\tof\tlong-term\ndebt | — | (2.1) | — | — | — | — | (2.1) |
| Other\tincome,\tnet | — | 0.2 | 1.0 | 0.6 | — | — | 1.8 |
| Income\t(loss)\tbefore\tincome\ttaxes | — | (262.5) | 898.0 | 36.9 | — | — | 672.4 |
| Income\ttax\t(expense)\tbenefit | — | 79.9 | (319.9) | (8.0) | — | — | (248.0) |
| Income\t(loss)\tbefore\tequity\tin\tearnings\tof\nsubsidiaries | — | (182.6) | 578.1 | 28.9 | — | — | 424.4 |
| Equity\tin\tearnings\tof\tsubsidiaries | 424.4 | 607.0 | — | — | — | (1,031.4) | — |
| Net\tincome | $424.4 | $424.4 | $578.1 | $28.9 | $— | $(1,031.4) | $424.4 |

|  |  | Year	Ended	December	31,	2015 | Year	Ended	December	31,	2015 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tsales | $— | $— | $12,151.2 | $837.5 | $— | $— | $12,988.7 |
| Cost\tof\tsales | — | — | 10,158.6 | 714.3 | — | — | 10,872.9 |
| Gross\tprofit | — | — | 1,992.6 | 123.2 | — | — | 2,115.8 |
| Selling\tand\tadministrative\texpenses | — | 114.5 | 1,020.9 | 90.6 | — | — | 1,226.0 |
| Advertising\texpense | — | — | 143.2 | 4.6 | — | — | 147.8 |
| Income\t(loss)\tfrom\toperations | — | (114.5) | 828.5 | 28.0 | — | — | 742.0 |
| Interest\t(expense)\tincome,\tnet | — | (158.3) | 2.3 | (3.5) | — | — | (159.5) |
| Net\tloss\ton\textinguishments\tof\tlong-term\ndebt | — | (24.3) | — | — | — | — | (24.3) |
| Management\tfee | — | 4.2 | — | (4.2) | — | — | — |
| Gain\ton\tremeasurement\tof\tequity\tinvestment | — | — | — | 98.1 | — | — | 98.1 |
| Other\t(expense)\tincome,\tnet | — | (11.1) | 1.6 | 0.2 | — | — | (9.3) |
| Income\t(loss)\tbefore\tincome\ttaxes | — | (304.0) | 832.4 | 118.6 | — | — | 647.0 |
| Income\ttax\t(expense)\tbenefit | — | 103.3 | (307.2) | (40.0) | — | — | (243.9) |
| Income\t(loss)\tbefore\tequity\tin\tearnings\tof\nsubsidiaries | — | (200.7) | 525.2 | 78.6 | — | — | 403.1 |
| Equity\tin\tearnings\tof\tsubsidiaries | 403.1 | 603.8 | — | — | — | (1,006.9) | — |
| Net\tincome | $403.1 | $403.1 | $525.2 | $78.6 | $— | $(1,006.9) | $403.1 |

# Condensed	Consolidating	Statement	of	Comprehensive	Income

|  | Condensed	Consolidating	Statement	of	Comprehensive	Income | Condensed	Consolidating	Statement	of	Comprehensive	Income | Condensed	Consolidating	Statement	of	Comprehensive	Income | Condensed	Consolidating	Statement	of	Comprehensive	Income |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | Year\tEnded\tDecember\t31,\t2015 |  |  |  |  |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Comprehensive\tincome | $358.6 | $358.6 | $525.2 | $34.1 | $— | $(917.9) | $358.6 |

# Condensed	Consolidating	Statement	of	Cash	Flows

|  |  | Year	Ended	December	31,	2017 | Year	Ended	December	31,	2017 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tcash\tprovided\tby\t(used\tin)\toperating\nactivities | $0.6 | $(71.1) | $788.5 | $52.3 | $— | $7.4 | $777.7 |
| Cash\tflows\tused\tin\tinvesting\tactivities: |  |  |  |  |  |  |  |
| Capital\texpenditures | — | (55.2) | (6.3) | (19.6) | — | — | (81.1) |
| Net\tcash\tused\tin\tinvesting\tactivities | — | (55.2) | (6.3) | (19.6) | — | — | (81.1) |
| Cash\tflows\t(used\tin)\tprovided\tby:\tfinancing\nactivities: |  |  |  |  |  |  |  |
| Proceeds\tfrom\tborrowings\tunder\nrevolving\tcredit\tfacility | — | 1,501.5 | — | 59.2 | — | — | 1,560.7 |
| Repayments\tof\tborrowings\tunder\nrevolving\tcredit\tfacility | — | (1,501.5) | — | (59.2) | — | — | (1,560.7) |
| Repayments\tof\tlong-term\tdebt | — | (14.9) | — | — | — | — | (14.9) |
| Proceeds\tfrom\tissuance\tof\tlong-term\ndebt | — | 2,083.0 | — | — | — | — | 2,083.0 |
| Payments\tto\textinguish\tlong-term\tdebt | — | (2,121.3) | — | — | — | — | (2,121.3) |
| Net\tchange\tin\tother\tlong-term\tobligation | — | — | (3.8) | — | — | — | (3.8) |
| Payment\tof\tdebt\tfinancing\tcosts | — | (9.6) | — | — | — | — | (9.6) |
| Net\tchange\tin\taccounts\tpayable-\ninventory\tfinancing | — | (0.2) | (78.4) | (5.4) | — | — | (84.0) |
| Effective\tportion\tof\tinterest\trate\tcap\nagreements | — | 0.4 | — | — | — | — | 0.4 |
| Proceeds\tfrom\tstock\toption\texercises | — | 13.0 | — | — | — | — | 13.0 |
| Proceeds\tfrom\tCoworker\tstock\tpurchase\nplan | — | 10.3 | — | — | — | — | 10.3 |
| Repurchases\tof\tcommon\tstock | (534.0) | — | — | — | — | — | (534.0) |
| Payment\tof\tincentive\tcompensation\tplan\nwithholding\ttaxes | (49.6) | — | — | — | — | — | (49.6) |
| Dividends | (106.9) | — | — | — | — | — | (106.9) |
| Principal\tpayments\tunder\tcapital\tlease\nobligations | — | — | (0.2) | (1.1) | — | — | (1.3) |
| Repayment\tof\tintercompany\tloan | — | — | 34.3 | (34.3) | — | — | — |
| Distributions\tand\tadvances\tfrom\t(to)\naffiliates | 689.9 | 56.6 | (737.2) | — | — | (9.3) | — |
| Net\tcash\t(used\tin)\tprovided\tby\tfinancing\nactivities | (0.6) | 17.3 | (785.3) | (40.8) | — | (9.3) | (818.7) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\ncash\tequivalents | — | — | — | 2.6 | — | — | 2.6 |
| Net\tdecrease\tin\tcash\tand\tcash\tequivalents | — | (109.0) | (3.1) | (5.5) | — | (1.9) | (119.5) |
| Cash\tand\tcash\tequivalents\t–\tbeginning\tof\nperiod | — | 222.7 | 3.1 | 37.9 | — | — | 263.7 |
| Cash\tand\tcash\tequivalents\t–\tend\tof\tperiod | $— | $113.7 | $— | $32.4 | $— | $(1.9) | $144.2 |

|  |  |  | Year	Ended	December	31,	2016 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tcash\tprovided\tby\t(used\tin)\toperating\nactivities | $— | $(158.5) | $695.5 | $56.1 | $— | $10.9 | $604.0 |
| Cash\tflows\tused\tin\tinvesting\tactivities: |  |  |  |  |  |  |  |
| Capital\texpenditures | — | (50.9) | (7.6) | (5.0) | — | — | (63.5) |
| Premium\tpayments\ton\tinterest\trate\ncap\tagreements | — | (2.4) | — | — | — | — | (2.4) |
| Net\tcash\tused\tin\tinvesting\tactivities | — | (53.3) | (7.6) | (5.0) | — | — | (65.9) |
| Cash\tflows\t(used\tin)\tprovided\tby\nfinancing\tactivities: |  |  |  |  |  |  |  |
| Proceeds\tfrom\tborrowings\tunder\nrevolving\tcredit\tfacility | — | 329.6 | — | 9.2 | — | — | 338.8 |
| Repayments\tof\tborrowings\tunder\nrevolving\tcredit\tfacility | — | (329.6) | — | (9.2) | — | — | (338.8) |
| Repayments\tof\tlong-term\tdebt | — | (15.2) | — | (5.4) | — | — | (20.6) |
| Proceeds\tfrom\tissuance\tof\tlong-term\ndebt | — | 1,483.0 | — | — | — | — | 1,483.0 |
| Payments\tto\textinguish\tlong-term\ndebt | — | (1,490.4) | — | — | — | — | (1,490.4) |
| Net\tchange\tin\tother\tlong-term\nobligation | — | — | 15.7 | — | — | — | 15.7 |
| Payment\tof\tdebt\tfinancing\tcosts | — | (4.5) | — | (1.4) | — | — | (5.9) |
| Net\tchange\tin\taccounts\tpayable\t-\ninventory\tfinancing | — | 1.5 | 131.0 | 11.1 | — | — | 143.6 |
| Proceeds\tfrom\tstock\toption\texercises | — | 7.4 | — | — | — | — | 7.4 |
| Proceeds\tfrom\tCoworker\tStock\nPurchase\tPlan | — | 9.3 | — | — | — | — | 9.3 |
| Repurchases\tof\tcommon\tstock |  |  |  |  |  |  |  |
|  | (367.4) | — | — | — | — | — | (367.4) |
| Dividends | (78.7) | — | — | — | — | — | (78.7) |
| Principal\tpayments\tunder\tcapital\nlease\tobligations | — | — | 1.0 | (1.6) | — | — | (0.6) |
| Repayment\tof\tintercompany\tloan | — | — | 40.4 | (40.4) | — | — | — |
| Distributions\tand\tadvances\tfrom\t(to)\naffiliates | 446.1 | 398.3 | (872.9) | — | — | 28.5 | — |
| Net\tcash\t(used\tin)\tprovided\tby\tfinancing\nactivities | — | 389.4 | (684.8) | (37.7) | — | 28.5 | (304.6) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\nand\tcash\tequivalents | — | — | — | (7.4) | — | — | (7.4) |
| Net\tincrease\tin\tcash\tand\tcash\tequivalents | — | 177.6 | 3.1 | 6.0 | — | 39.4 | 226.1 |
| Cash\tand\tcash\tequivalents—beginning\tof\nperiod | — | 45.1 | — | 31.9 | — | (39.4) | 37.6 |
| Cash\tand\tcash\tequivalents—end\tof\tperiod | $— | $222.7 | $3.1 | $37.9 | $— | $— | $263.7 |

|  |  | Year	Ended	December	31,	2015 | Year	Ended	December	31,	2015 |  |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (in\tmillions) | Parent\nGuarantor | Subsidiary\nIssuer | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Co-Issuer | Consolidating\nAdjustments | Consolidated |
| Net\tcash\tprovided\t(used\tin)\tby\toperating\nactivities | $0.5 | $(18.1) | $350.0 | $27.9 | $— | $(82.8) | $277.5 |
| Cash\tflows\tfrom\tinvesting\tactivities: |  |  |  |  |  |  |  |
| Capital\texpenditures | — | (75.4) | (11.6) | (3.1) | — | — | (90.1) |
| Premium\tpayments\ton\tinterest\trate\ncap\tagreements | — | (0.5) | — | — | — | — | (0.5) |
| Acquisition\tof\tbusiness,\tnet\tof\tcash\nacquired | — | — | — | (263.8) | — | — | (263.8) |
| Net\tcash\tused\tin\tinvesting\tactivities | — | (75.9) | (11.6) | (266.9) | — | — | (354.4) |
| Cash\tflows\tfrom\tfinancing\tactivities: |  |  |  |  |  |  |  |
| Proceeds\tfrom\tborrowings\tunder\nrevolving\tcredit\tfacility | — | 314.5 | — | — | — | — | 314.5 |
| Repayments\tof\tborrowings\tunder\nrevolving\tcredit\tfacility | — | (314.5) | — | — | — | — | (314.5) |
| Repayments\tof\tlong-term\tdebt | — | (15.4) | — | (17.4) | — | — | (32.8) |
| Proceeds\tfrom\tissuance\tof\tlong-term\ndebt | — | 525.0 | — | — | — | — | 525.0 |
| Payments\tto\textinguish\tlong-term\ndebt | — | (525.3) | — | — | — | — | (525.3) |
| Payment\tof\tdebt\tfinancing\tcosts | — | (6.8) | — | — | — | — | (6.8) |
| Net\tchange\tin\taccounts\tpayable-\ninventory\tfinancing | — | — | 96.1 | (0.2) | — | — | 95.9 |
| Proceeds\tfrom\tstock\toption\texercises | — | 2.4 | — | — | — | — | 2.4 |
| Proceeds\tfrom\tCoworker\tstock\npurchase\tplan | — | 8.7 | — | — | — | — | 8.7 |
| Repurchases\tof\tcommon\tstock | (241.3) | — | — | — | — | — | (241.3) |
| Payment\tof\tincentive\tcompensation\nplan\twithholding\ttaxes |  |  |  |  |  |  |  |
|  | — | 0.6 | — | — | — | — | 0.6 |
| Dividends | (52.9) | — | — | — | — | — | (52.9) |
| Distributions\tand\tadvances\tfrom\t(to)\naffiliates | 293.7 | (196.5) | (434.5) | 267.4 | — | 69.9 | — |
| Net\tcash\t(used\tin)\tprovided\tby\tfinancing\nactivities | (0.5) | (207.3) | (338.4) | 249.8 | — | 69.9 | (226.5) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\nand\tcash\tequivalents | — | — | — | (3.5) | — | — | (3.5) |
| Net\t(decrease)\tincrease\tin\tcash\tand\tcash\nequivalents | — | (301.3) | — | 7.3 | — | (12.9) | (306.9) |
| Cash\tand\tcash\tequivalents\t–\tbeginning\tof\nperiod | — | 346.4 | — | 24.6 | — | (26.5) | 344.5 |
| Cash\tand\tcash\tequivalents\t–\tend\tof\tperiod | $— | $45.1 | $— | $31.9 | $— | $(39.4) | $37.6 |

# 20.				Selected	Quarterly	Financial	Results	(unaudited)

| (in	millions,	except	per-share	amounts) | First	Quarter | Second	Quarter | Third	Quarter | Fourth	Quarter |
| :--- | :--- | :--- | :--- | :--- |
| Net\tSales: |  |  |  |  |
| Corporate | \t $1,476.3 | \t $1,630.7 | \t $1,598.5 | \t $1,641.4 |
| Small\tBusiness | 298.7 | 321.5 | 311.5 | 314.8 |
| Public: |  |  |  |  |
| Government | 386.9 | 543.9 | 606.7 | 630.0 |
| Education | 397.1 | 712.9 | 700.7 | 400.8 |
| Healthcare | 392.5 | 417.3 | 425.5 | 423.3 |
| Total\tPublic | 1,176.5 | 1,674.1 | 1,732.9 | 1,454.1 |
| Other | 373.2 | 368.1 | 391.0 | 428.3 |
| Net\tsales | \t $3,324.7 | \t $3,994.4 | \t $4,033.9 | \t $3,838.6 |
| Gross\tprofit | \t $552.6 | \t $641.1 | \t $642.0 | \t $614.4 |
| Income\tfrom\toperations | 169.8 | 231.1 | 243.7 | 221.6 |
| Net\tincome(2) | 57.6 | 141.0 | 129.2 | 195.2 |
| Basic(3) | 0.36 | 0.90 | 0.84 | 1.28 |
| Diluted(3) | 0.35 | 0.89 | 0.83 | 1.26 |
| Cash\tdividends\tdeclared\tper\tcommon\tshare | \t $0.1600 | \t $0.1600 | \t $0.1600 | \t $0.2100 |

| (in	millions,	except	per-share	amounts) | First	Quarter | Second	Quarter | Third	Quarter | Fourth	Quarter |
| :--- | :--- | :--- | :--- | :--- |
| Net\tSales: |  |  |  |  |
| Corporate(4) | \t $1,414.9 | \t $1,490.8 | \t $1,466.4 | \t $1,517.7 |
| Small\tBusiness(4) | 277.4 | 288.4 | 282.5 | 291.8 |
| Public: |  |  |  |  |
| Government | 339.9 | 456.6 | 537.5 | 529.6 |
| Education | 341.0 | 640.0 | 671.4 | 365.9 |
| Healthcare | 388.5 | 450.4 | 431.7 | 436.8 |
| Total\tPublic | 1,069.4 | 1,547.0 | 1,640.6 | 1,332.3 |
| Other | 355.0 | 338.4 | 318.7 | 350.5 |
| Net\tsales | \t $3,116.7 | \t $3,664.6 | \t $3,708.2 | \t $3,492.4 |
| Gross\tprofit | \t $524.5 | \t $610.5 | \t $614.3 | \t $577.9 |
| Income\tfrom\toperations | 161.0 | 223.5 | 237.5 | 197.2 |
| Net\tincome | 77.8 | 117.5 | 125.9 | 103.2 |
| Basic(3) | 0.47 | 0.71 | 0.78 | 0.64 |
| Diluted(3) | 0.46 | 0.70 | 0.76 | 0.63 |
| Cash\tdividends\tdeclared\tper\tcommon\tshare | \t $0.1075 | \t $0.1075 | \t $0.1075 | \t $0.1600 |

(1) Sum of quarters	 may not agree to reported yearly totals due to rounding.

(2) The	fourth	quarter	of	2017	includes	the	benefit	of	the	Tax	Cuts	and	Jobs	Act	enacted	during	2017.	For	information	regarding	the	Tax	Cuts	and	Jobs Act,	see	Note	11	(Income	Taxes).

(3) Basic	and	diluted	net	income	per	share	are	computed	independently	for	each	of	the	quarters	presented.	Therefore,	the	sum	of	quarterly	basic	and diluted	per	share	information	may	not	equal	annual	basic	and	diluted	net	income	per	share.

On	February	7,	2018,	the	Company	announced	that	its	Board	of	Directors	has	declared	a	quarterly	cash	dividend	of	$0.21	per	common	share	to	be	paid	on March	12,	2018	to	all	stockholders	of	record	as	of	the	close	of	business	on	February	26,	2018.

# SCHEDULE	II	–	VALUATION	AND	QUALIFYING	ACCOUNTS

| (in	millions) | Balance	at<br>Beginning<br>of	Period | Charged	to<br>Costs	and<br>Expenses | Deductions | Balance	at<br>End	of<br>Period |
| :--- | :--- | :--- | :--- | :--- |
| Allowance\tfor\tdoubtful\taccounts: |  |  |  |  |
| Year\tEnded\tDecember\t31,\t2017 | $5.9 | $2.1 | $(1.8) | $6.2 |
| Year\tEnded\tDecember\t31,\t2016 | 6.0 | 2.0 | (2.1) | 5.9 |
| Year\tEnded\tDecember\t31,\t2015 | 5.7 | 4.2 | (3.9) | 6.0 |
| Reserve\tfor\tsales\treturns: |  |  |  |  |
| Year\tEnded\tDecember\t31,\t2017 | $6.8 | $40.6 | $(41.0) | $6.4 |
| Year\tEnded\tDecember\t31,\t2016 | 4.9 | 38.1 | (36.2) | 6.8 |
| Year\tEnded\tDecember\t31,\t2015 | 5.1 | 34.4 | (34.6) | 4.9 |

# Item	9.	Changes	in	and	Disagreements	with	Accountants	on	Accounting	and	Financial	Disclosure

# Item	9A.	Controls	and	Procedures

# Evaluation	of	Disclosure	Controls	and	Procedures

The	Company's	management,	with	the	participation	of	the	Company's	Chief	Executive	Officer	and	Chief	Financial	Officer,	has	evaluated	the	effectiveness	of the	Company's	disclosure	controls	and	procedures	(as	such	term	is	defined	in	Rule	13a-15(e)	or	Rule	15d-15(e)	under	the	Securities	Exchange	Act	of	1934,	as	amended (the	"Exchange	Act"))	as	of	the	end	of	the	period	covered	by	this	report.	Based	on	such	evaluation,	the	Company's	management,	including	the	Company's	Chief Executive	Officer	and	Chief	Financial	Officer,	has	concluded	that,	as	of	the	end	of	such	period,	the	Company's	disclosure	controls	and	procedures	were	effective	in recording,	processing,	summarizing,	and	reporting,	on	a	timely	basis,	information	required	to	be	disclosed	by	the	Company	in	the	reports	that	it	files	or	submits	under	the Exchange	Act,	and	that	information	is	accumulated	and	communicated	to	the	Company's	management,	including	the	Company's	Chief	Executive	Officer	and	Chief Financial	Officer,	as	appropriate	to	allow	timely	discussions	regarding	required	disclosure.

# Management's	Annual	Report	on	Internal	Control	over	Financial	Reporting

Management	is	responsible	for	establishing	and	maintaining	adequate	internal	control	over	financial	reporting,	as	defined	in	Rule	13a-15(f)	and	15d-15(f)	under the	Exchange	Act.	Because	of	its	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements	and	can	provide	only	reasonable assurance	with	respect	to	financial	statement	preparation	and	presentation.	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	policies	or	procedures	may	deteriorate.

Management	 assessed	 the	 effectiveness	 of	 the	 Company's	 internal	 control	 over	 financial	 reporting	 as	 of	 December	 31,	2017.	 Management	 based	 this assessment	on	the	criteria	set	forth	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(COSO)	in	"Internal	Control	—	Integrated	Framework (2013	framework)."

Based	on	its	assessment,	management	concluded	that,	as	of	December	31,	2017,	the	Company's	internal	control	over	financial	reporting	is	effective.

Ernst	&	Young	LLP,	independent	registered	public	accounting	firm,	has	audited	the	Consolidated	Financial	Statements	of	the	Company	and	the	Company's internal	control	over	financial	reporting	and	has	included	their	reports	herein.

# Changes	in	Internal	Control	over	Financial	Reporting

There	have	been	no	changes	in	our	internal	control	over	financial	reporting	during	the	quarter	ended	December	31,	2017	that	have	materially	affected	or	are reasonably	likely	to	materially	affect,	our	internal	control	over	financial	reporting.

# To	the	Stockholders	and	the	Board	of	Directors	of	CDW	Corporation	and	subsidiaries

# Opinion	on	Internal	Control	over	Financial	Reporting

We	have	audited	CDW	Corporation	and	subsidiaries'	internal	control	over	financial	reporting	as	of	December	31,	2017,	based	on	criteria	established	in	Internal	Control- Integrated	Framework	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(2013	framework)	(the	COSO	criteria).	In	our	opinion,	CDW Corporation	and	subsidiaries	(the	Company)	maintained,	in	all	material	respects,	effective	internal	control	over	financial	reporting	as	of	December	31,	2017,	based	on the	COSO	criteria.

We	also	have	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States)	(PCAOB),	the	consolidated	balance	sheets of	the	Company	as	of	December	31,	2017	and	2016,	and	the	related	consolidated	statements	of	operations,	comprehensive	income,	stockholders'	equity	and	cash	flows for	each	of	the	three	years	in	the	period	ended	December	31,	2017,	and	the	related	notes	and	the	financial	statement	schedule	listed	in	the	Index	at	Item	15	(a)	(2)	and our	report	dated	February	28,	2018	expressed	an	unqualified	opinion	thereon.

The	Company'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's	Annual	Report	on	Internal	Control	Over	Financial	Reporting.	Our	responsibility	is	to express	an	opinion	on	the	Company's	internal	control	over	financial	reporting	based	on	our	audit.	We	are	a	public	accounting	firm	registered	with	the	PCAOB	and	are required	to	be	independent	with	respect	to	the	Company	in	accordance	with	the	U.S.	federal	securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and Exchange	Commission	and	the	PCAOB.

We	conducted	our	audit	in	accordance	with	the	standards	of	the	PCAOB.	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.

# Definition	and	Limitations	of	Internal	Control	Over	Financial	Reporting

A	company'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'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)	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)	 provide	 reasonable	 assurance	 regarding	 prevention	 or	 timely	 detection	 of	 unauthorized	 acquisition,	 use,	 or disposition	of	the	company's	assets	that	could	have	a	material	effect	on	the	financial	statements.

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.

# Item	9B.	Other	Information

# PART	III

# Item	10.	Directors,	Executive	Officers	and	Corporate	Governance

We	have	adopted	The	CDW	Way	Code,	our	code	of	business	conduct	and	ethics,	that	is	applicable	to	all	of	our	coworkers	and	directors.	Additionally,	within The	CDW	Way	Code	is	a	Financial	Integrity	Code	of	Ethics	that	sets	forth	an	even	higher	standard	applicable	to	our	executives,	officers,	members	of	our	internal disclosure	committee	and	all	managers	and	above	in	our	finance	department.	A	copy	of	this	code	is	available	on	our	website	at	www.cdw.com.	If	we	make	any substantive	amendments	to	this	code	or	grant	any	waiver	from	a	provision	to	our	chief	executive	officer,	principal	financial	officer	or	principal	accounting	officer,	we will	disclose	the	nature	of	such	amendment	or	waiver	on	our	website	or	in	a	report	on	Form	8-K.

See	Part	I	-	"Executive	Officers"	for	information	about	our	executive	officers,	which	is	incorporated	by	reference	in	this	Item	10.	Other	information	required under	this	Item	10	is	incorporated	herein	by	reference	to	the	2018	Proxy	Statement.

# Item	11.	Executive	Compensation

Information	required	under	this	Item	11	is	incorporated	herein	by	reference	to	the	2018	Proxy	Statement.

# Item	12.	Security	Ownership	of	Certain	Beneficial	Owners	and	Management	and	Related	Stockholder	Matters

# Item	13.	Certain	Relationships	and	Related	Transactions,	and	Director	Independence

# Item	14.	Principal	Accountant	Fees	and	Services

# PART	IV

# Item	15.	Exhibits	and	Financial	Statement	Schedules

# (a) Financial	Statements	and	Schedules

The	following	documents	are	filed	as	part	of	this	report:

# (1) Consolidated Financial

Statements:

All	other	schedules	are	omitted	since	the	required	information	is	not	present	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	or	notes	thereto.

10.1 		 Second	Amended	and	Restated	Revolving	Loan	Credit	Agreement,	dated	March	31,	2017,	by	and	among	CDW	LLC,	the	lenders	party	thereto, JPMorgan	Chase	Bank,	N.A.,	as	administrative	agent,	Wells	Fargo	Commercial	Distribution	Finance,	LLC,	as	floorplan	funding	agent,	and	the joint	lead	arrangers,	joint	bookrunners,	co-collateral	agents,	co-syndication	agents	and	co-documentation	agents	party	thereto,	previously	filed	as Exhibit	10.1	with	CDW	Corporation's	Form	8-K	filed	on	March	31,	2017	and	incorporated	herein	by	reference.

		10.13§ 		 Form	of	CDW	Corporation	Option	Award	Notice	and	Stock	Option	Agreement	(executive	officers),	previously	filed	as	Exhibit	10.37	with	CDW Corporation's	Amendment	No.	2	to	Form	S-1	filed	on	June	14,	2013	(Reg.	No.	333-187472)	and	incorporated	herein	by	reference.

		10.14§ 		 Form	of	CDW	Corporation	Option	Award	Notice	and	Stock	Option	Agreement	(other	than	executive	officers),	previously	filed	as	Exhibit	10.38 with	CDW	Corporation's	Amendment	No.	2	to	Form	S-1	filed	on	June	14,	2013	(Reg.	No.	333-187472)	and	incorporated	herein	by	reference.

		10.15§ Form	of	CDW	Corporation	Restricted	Stock	Award	Notice	and	Restricted	Stock	Award	Agreement	(executive	officers),	previously	filed	as Exhibit	10.12	with	CDW	Corporation's	Form	10-Q	filed	on	August	12,	2013	and	incorporated	herein	by	reference.

		10.16§ Form	of	CDW	Corporation	Restricted	Stock	Award	Notice	and	Restricted	Stock	Award	Agreement	(other	than	executive	officers),	previously filed	as	Exhibit	10.13	with	CDW	Corporation's	Form	10-Q	filed	on	August	12,	2013	and	incorporate	herein	by	reference.

		10.17§ CDW	Amended	and	Restated	Restricted	Debt	Unit	Plan,	previously	filed	as	Exhibit	10.3	with	CDW	Corporation's	Form	10-Q	filed	on	November 7,	2013	and	incorporated	herein	by	reference.

		10.21§ Form	of	Stock	Option	Agreement	(executive	officers)	under	the	CDW	Corporation	Amended	and	Restated	2013	Long-Term	Incentive	Plan, previously	filed	as	Exhibit	10.1	with	CDW	Corporation's	Form	10-K	filed	on	March	1,	2017	and	incorporated	herein	by	reference.

		10.22§,* Form	of	Stock	Option	Agreement	(other	than	executive	officers)	under	the	CDW	Corporation	Amended	and	Restated	2013	Long-Term	Incentive Plan.

		10.23§ Form	of	Performance	Share	Unit	Award	Agreement	(executive	officers)	under	the	CDW	Corporation	Amended	and	Restated	2013	Long-Term Incentive	Plan,	previously	filed	as	Exhibit	10.1	with	CDW	Corporation's	Form	10-K	filed	on	March	1,	2017	and	incorporated	herein	by	reference.

		10.24§,* Form	of	Performance	Share	Unit	Award	Agreement	(other	than	executive	officers)	under	the	CDW	Corporation	Amended	and	Restated	2013 Long-Term	Incentive	Plan.

		10.25§ Form	of	Performance	Share	Award	Agreement	(executive	officers)	under	the	CDW	Corporation	Amended	and	Restated	2013	Long-Term Incentive	Plan,	previously	filed	as	Exhibit	10.1	with	CDW	Corporation's	Form	10-K	filed	on	March	1,	2017	and	incorporated	herein	by	reference.

		10.26§ Form	of	Non-Employee	Director	Restricted	Stock	Unit	Award	Agreement	under	the	CDW	Corporation	2013	Long-Term	Incentive	Plan, previously	filed	as	Exhibit	10.6	with	CDW	Corporation's	Form	10-Q	filed	on	May	12,	2014	and	incorporated	herein	by	reference.

		10.27§ Letter	of	Understanding,	dated	as	of	October	9,	2017,	by	and	among	CDW	Corporation,	CDW	LLC	and	Ann	E.	Ziegler,	previously	filed	as Exhibit	10.2	with	CDW	Corporation's	Form	10-Q	filed	on	November	2,	2017	and	incorporated	herein	by	reference.

* Filed

herewith

** These	items	are	furnished	and	not	filed.

§ A	management	contract	or	compensatory	arrangement	required	to	be	filed	as	an	exhibit	pursuant	to	Item	601	of	Regulation	S-

# SIGNATURES

Pursuant	to	the	requirements	of	Section	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.

Thomas	E.	Richards

Chairman,	President	and	Chief	Executive	Officer

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	and	on	the	dates	indicated.



Question: what was 2016 gross margin percent?
Calculation: gross_margin_2016 = 2327.2
revenue_2016 = 12988.7
gross_margin_percent_2016 = gross_margin_2016 / revenue_2016
answer = gross_margin_percent_2016 * 100
Answer: 18%