Our Journey to First Choice by Progressive Communications

UNLEASHING OUR FULL POTENTIAL

Our IT Journey

Enabling Competitive Greatness Facilities Maintenance White Cap Power solutions WaterWOrks Creative Touch Interiors

Crown Bolt Canada Repair & Remodel IT Sourcing Enterprise Applications Infrastructure Information Security Field Services Wellness and our Communities

Trademark Disclaimer: Product names, logos, brands and other trademarks referred to within the HD Supply-IT Journey Line publication are the property of their respective trademark holders. Referenced trademark holders within this publication are not affiliated with HD Supply, Inc. or HD Supply Support Services, Inc. and they do not sponsor or endorse our materials. Neither HD Supply, Inc. nor HD Supply Support Services, Inc. have any interest in or make any claim or right to the respective third-party owned trademarks, copyrights or intellectual property referenced in the HD Supply-IT Journey Line publication as follows: SAP®; Oracle®; IBM®; IBM Websphere Commerce®; IBM iSeries®; IBM Datastage®; IBM Message Broker®; Microsoft®; Avaya®; MicroStrategy®; Salesforce. com®; richrelevance®; Lucas Systems®; The Numina Group®; Levi, Ray & Shoup, Inc.®; Infor™; MobileFrame®; VISUALFORCE™; Cisco®; ADP®; Linux™; UNIX®; JD Edwards®; Minerva Associates®; ForecastPro®; Red Prairie®; Java™; Apple®; iPhone®; iPad®; The Home Depot®; Hewlett-Packard (HP)®; Microsoft Active Directory®; Microsoft SQL Server®; Microsoft Windows®; Microsoft SharePoint®; Microsoft Access®; Microsoft Excel®; Asterisk®; Hitatchi®; Nagios®; PeopleSoft®; Airwatch®; Verizon®; UC4™; Give Kids The World Village®; Habitat For Humanity®; American Cancer Society®; Novatus Contract Management™; DocuSign®; Epicor Eclipse™; Microsoft Dynamics AX®; Documentum®; Mincron Hardgoods Distribution ERP®; Khalix®; AssureNET GL®; GETPAID®; Kronos®; Learn.com®; SuccessFactors™; Teradata®; Unilog®; Dun & Bradstreet®; Process Maker®; Wordpress®; Intranet CMS®; Appcelerator®; Sitecore®; and Synygy®.

Build Our Company 2007 2007

Invest for Our Future

2008-2009

SIMPLIFY Launch SAP Financials at FM

INTEGRATe

Build Enterprise Data Warehouse/BI

Form IT Leadership Team

Establish IT Intern Program

Integrate 18 email systems

Consolidate Power Solutions ERP

Rationalize Core Applications

Deploy SIP Trunking

Select Core Platforms Migrate 23 data centers to 2

Pre Grow Gro

20102010-

DIGITI

Deplo

Virtua

Imple & E-C

Deplo

Launc

Mana

Launc

epare for owth

-2011 -2011

DIGITIZE

oy FM SAP to DCs and E-Business

alize Servers

ement WC Oracle ERP Commerce

oy PeopleSoft

ch Sales Force Effectiveness Tools

age Customer Remote Inventory

ch Pick-to-Voice

Unleash Our Full Potential 2012-2013 2012-2013

INNOVate Build Advanced Customer Solutions Create Mobile Solutions Expand E-Commerce Leverage Technology Investments Take Care of Each Other

Enabling competitive greatness One Team, Driving Customer Success and Value Creation.

To Our Valued IT Associates, Often in our busy lives, we find ourselves racing to some “milestone” or “finish line” – whether it is getting our kids off to school on time so they can prepare for college, or hitting the gym to stay fit, or finishing a project at work to deliver customer value with our team – and then we realize how quickly the moments go by and that time is passing so quickly. Once in a while, it is important to LIVE IN THE MOMENT and reflect on how incredibly blessed we are to work side-by-side with a group of dedicated, talented, and inspirational people who have made a tremendous difference in our lives, and to simply say THANK YOU. We are so fortunate to be on this journey TOGETHER.

SVP & CIO

Thank you for Your Hard Work and Dedication that Enables Our Competitive Greatness! I am forever grateful for your TEAMWORK and COMMITMENT TO EACH OTHER. Enjoy reading about OUR IT Journey – so far – as we reflect on these incredible moments enabling Our First Choice Success! —Michele

Facilities Maintenance

White Cap

Power Solutions

Waterworks

Creative Touch Interiors

Crown Bolt

Canada

Repair & Remodel

OUR Beginnings In 2006, when I had the honor to join Joe DeAngelo at HD Supply while we were a part of The Home Depot®, Joe asked me to do two things: 1) Set an IT strategy that would enable organic and acquisition growth while delivering cost productivity and 2) build a team of IT professionals who were business thinkers, and who would deliver value to our company and our customers. My first weeks on the job were challenging since we had 18 disparate email systems inhibiting our ability to communicate as ONE TEAM, our IT Staff had never met each other, and we had no IT strategy to support the

Michele Markham

rapid growth. On top of this, we had been acquiring companies at a rapid pace and by my third week on the job, I was asked to fly to Orlando to begin the diligence on our largest acquisition target, Hughes Supply. As they say, the rest is history! Within 90 days we had developed our IT strategy to deliver a technology roadmap that would allow differentiation to best serve our varied customers and business models, while delivering a highly-efficient, scalable foundation for growth! In collaboration with our business teams, we defined a framework for technology investments that (1) exceeds our Customers’

needs, (2) provides efficiency for our associates to serve our customers, and (3) maximizes EBITDA and Return on Investment. Throughout our journey, you will learn about EXTRAORDINARY TEAMWORK and extreme focus on our customers as we stood up our company after divesting from The Home Depot® in 2007. I am incredibly proud of our results, but even more importantly, of HOW we’ve achieved these results by working together to build something very special. Our culture of “Doing, Learning, Winning” is a critical foundation to our success, ensuring we get results (doing), learn from every experience so we repeat what works and change that which does not (learning), and celebrate and recognize our team (winning)! Over the past several years, our work has aligned around (1) SIMPLIFICATION, to make it easy for customers to buy from HD Supply, with selection of ONE ERP per business unit that best meets customer’ needs; (2) DIGITIZATION, to build efficient business processes and standardize on best practices that are transferable across our company; (3) INTEGRATION for Cost productivity by building an Infrastructure and Security platform that would scale with our business growth, leveraging strong vendor relationships and best-in-class technology; and (4) INNOVATION that brings a competitive advantage, with differentiated services and solutions for our Customers.

SIMPLIFICATION Since 2007, we have retired 30% duplicate or antiquated systems while responding to enormous demand (+490 systems) for technology that enables improved business processes and changes how we serve our customers and associates. Our vision of one ERP per business unit is almost complete,

as we finish deployment and consolidation efforts in 2013. We have selected best-cost solutions by building relationships with incredible vendors in our industry and rely on their expertise to partner with us as we grow. As you read our journey, you will learn more about our Customer-Facing portals, E-Commerce and Mobility solutions that connect our customers to HD Supply!

solutions in our Enterprise Applications section!

INTEGRATION Once we agreed as a leadership team to allow for differentiation where needed (facing our customers) and standardization where we could (enterprise applications), we began our infrastructure integration efforts that has delivered significant cost productivity, achieving world-class capabilities. Our goals included: 1. Architect for high availability and high redundancy, using open source technology and efficient monitoring and exception-based escalations

DIGITIZATION With more than 100 acquisitions over our lifetime, it is expected that we initially had many different ways to do things. By partnering with our Functional teams in Human Resources and Communications, Finance, Legal, Sourcing and Operations, and Strategic Business Development, we have migrated to best-in-class platforms that enable highly efficient processes and speed of execution. We believe the power of “One HD Supply” allows us to build something once and re-deploy it wherever needed, increasing speed and reducing costs, fostering our One Team approach to winning! We have built a foundation of world-class services used by all our teams, including: Peoplesoft® Human Resources Lifecycle Management, Oracle® Financial Consolidation and Reporting, Sourcing and Rebates Management, Specialized Distribution Management tools, Internet and Intranet Marketing and Communications tools, and Microstrategy® Business Intelligence. Read more about our 150 centralized

2. Consolidate 23 disparate data centers to two Tier-3 Data Centers, leveraging our Orlando and San Diego sites with high speed connectivity between our sites, while providing inhouse disaster recovery of key applications (core business systems) 3. Create an Information Security framework that leverages best-inclass technology to balance risk while enabling business growth 4. Expand our private Network to all locations, eliminating single points of failure, and installing satellite backup to ensure our branches and distribution centers are always operating to serve customers 5. Standardize on highest quality, cost-competitive devices with central management: PC’s, laptops, printers, servers, storage, routers, switches, telecom and VOIP (voice over internet protocol), and mobile devices Partnering with our global vendors while annually evaluating market trends and new technology, we have built a strong foundation, enabling our company to leverage our investment and “Save as We Grow”. UNLEASHING OUR FULL POTENTIAL

Over the past few years, we have recognized our team with over fifty “Innovation Awards” to showcase our technology which brings a unique solution to our customers and enables us to provide the highest quality of service at the most competitive cost. Examples of Business Innovation can be found on our “Family Tree” on pages 26-27 and throughout our journey lines.

OPERATING EXCELLENCE Project Management and IT Sourcing

INNOVATION By the end of 2009, we had fostered our “Doing, Learning, and Winning” Culture within IT with 20% new hires since 2007, delivery of 800+ projects yielding $124M benefits, and reduced SGA by 35%. We had built our foundation for success, with enormous collaboration and our One Team Spirit! As we began 2010 – facing incredibly depressed market conditions and reduced IT investment worldwide – we launched our “First Choice Roadmap” across HD Supply, with improved alignment with the key metrics that were most critical for our long term success – Organic Growth, Profit Pull Through, Operating Efficiency, Earns to Turns and ROIC (return on invested capital).

To remain aligned with our business strategy, we further refined our IT mission to: “IT enables First Choice Success by Driving Innovation for a Competitive Advantage (doing), while striving for Perfection through our continuous improvement culture (learning), while demonstrating a ONE TEAM approach and passion for our customers in all that we do (winning).” Within our team, we added “innovation” to our “core priorities” to build on our foundation of success. Innovation is critical to achieve competitive greatness, by delivering differentiated products and services to our customers, while using technology to scale without adding unnecessary cost. Investing during a down-market has been an important strategy for HD Supply.

“First Choice describes how we want investors, customers, suppliers, associates and communities in which we live and work to view HD Supply. We want to be their First Choice in terms of who to invest in, who to grow with and who to trust to always be there.” – Joe DeAngelo, CEO, HD Supply

To deliver more than 1300 projects since 2007, yielding $235M in benefits and strong ROI, it takes “discipline without bureaucracy” and a team committed to winning. With every project, we use a repeatable tollgate-methodology – from requirements and design, to development, test, and quality assurance through go-live – we work side-by-side with our business users. Projects exceeding $1M require a formal Steering Committee involving our senior leadership team, ensuring we have full business commitment to achieve our Lean and Dynamic process improvements. Our IT Sourcing team works collaboratively with our vendor partners and our IT leaders to negotiate the best price and terms while retaining a strong working relationship. Mergers and Acquisitions With the same project discipline, we have acquired and integrated more than 20 companies since 2006, most recently Peachtree Business Products in Facilities Maintenance, and RAMSCO and Water Products of Oklahoma in our Waterworks business. Our IT M&A capabilities allow us to provide “Day 1” email and network integration, followed by

rapid infrastructure and application integration – usually complete within 90 days of close. We have also recently divested two noncore businesses units – Plumbing/ HVAC and Industrial Pipes, Valves and Fittings (IPVF) with a highly structured playbook for success. In both cases, HD Supply continued to provide technology services for these business units for several months after the divestiture date, minimizing business disruption during and after the sale.

OUR TEAM I am often asked what it takes to run 700 systems with high availability for our 15,000 associates supporting 500,000 customers. Well that’s easy - INCREDIBLE TEAMWORK! The most important part of our success is our ONE TEAM ATTITUDE. By selecting the best talent with relevant experience, we operate as ONE TEAM. By building the trust to learn from each other and by harnessing each person’s strength, we form a team that has more capability than doing anything individually. As partners with our business teams, we learn the business strategy and processes before we automate. Since technology is an “enabler” to business success, we must build the right solution with

speed and precision to deliver Lean and Dynamic process capability. We include as a part of our “IT family” our functional teammates, including Legal, HR, Marketing, and Communications, Finance, Sourcing and Operations, and Strategic Business Development. With their unwavering support and guidance, we are positioned to reach our Full First Choice potential. To build on our talent pipeline, we launched our Intern Program in 2008 with approximately 10 students for a 12-week internship. Our program provides select participants with a hands-on experience, developing a strong technical foundation across a wide array of technologies. To inspire and motivate our team, we invest in Learning, we celebrate with Recognition, and we build friendships while giving back to our communities all while we “take care of each other” with our BE WELL initiatives. Learning is a lifelong activity and with continuous on-the-job training, formal classroom instruction and opportunities for technical presentations at vendor events. Using our online tool for personal development or attending our monthly “lunch and learn sessions” are two ways to learn at HD Supply. We recognize our associates in a variety of ways including SPIRIT

and Management Awards, WOW Cards, Team Celebrations, Flexible Schedules and Innovation Awards. All levels of our organization are eligible to participate and say “Thanks” for a job well done! Giving back to our Communities allows our team to work side-byside and build relationships while helping others, which is so important to all of us at HD Supply. In collaboration with many organizations, we have worked together to improve lives working in partnership with groups such as Give Kids the World Village®, Habitat for Humanity® and the American Cancer Society®. To “Build our Best Lives”, we must take care of ourselves and each other, so we stay healthy for our families. When we go for our screenings and “know our numbers”, we are better informed to remain healthy. Please commit to BE WELL and leverage our programs to quit tobacco and right-size our BMI! We need all of us to achieve our Full Potential. Together, we can accomplish far more than we ever could individually!

OUR FUTURE “From this great foundation of First Choice Success, it is now our time to “Unleash our Full First Choice Potential!” With our Hard Work and Winning Attitude, we are well on our way to achieving Competitive Greatness! In 2013 we are focused on becoming the healthiest company, delivering 2X financial performance of our competitors, and taking care of each other! Thank you for your intense focus on winning and enjoy reading about our IT Journey – so far! UNLEASHING OUR FULL POTENTIAL

Facilities Maintenance

HD Supply Facilities Maintenance is a leading supplier of maintenance, repair and operations (MRO) products to owners and managers of multifamily, hospitality, educational and commercial properties; healthcare providers; and municipal and government facilities. We strive to deliver the highest quality products, support, services and fulfillment in the industry. Our dedicated team of experts provides customized solutions for all your MRO needs. With more than 22,000 items in stock, strategically positioned distribution centers and a fleet of more than 600 vehicles, we deliver your MRO supplies on time, on site.

Our 40+ distribution centers are equipped with state-of-theart technology supporting more than 20,000 orders per day with 35,000 customer deliveries.

With the majority of my team based in San Diego, we run dedicated systems and interfaces to support our business unit while leveraging enterprise systems and infrastructure. SAP速 Enterprise Core Component (ECC) is our core ERP to support Brian Monks all business processes. VP Information Daily, our world-class call Technology center manages 32,000 inbound calls and 10,000 outbound calls supported by Avaya速 technology. Our website is powered by IBM WebSphere Commerce速 and

is seamlessly integrated with SAP. E-Commerce orders represent 40% of all order volume. High availability of all systems is provided by dual redundant hardware and Disaster Recovery is provided through replicated systems in our Orlando data center.

Our Foundation Prior to 2007, Facilities Maintenance (FM) operated on a customized legacy Oracle速 application. With anticipation of strong growth and business expansion, we determined we needed an enterprise-class ERP and selected SAP as our platform. In late 2007, we launched SAP Financials as the foundation to our

SAP implementation, and by 2009 we had successfully implemented core SAP components to support our key business processes from order inception to backend financial processing. These core SAP components included Enterprise Core Components (ECC), Customer Relationship Management (CRM) and Business Warehouse (BW). ECC enabled scalability and controls within our core business processes. CRM provided our Marketing and Sales teams the tools they needed to manage all customer information, and integrated with our Enterprise Call Center technology to provide detailed information to the customer service representative when a customer calls. BW provided the tools our analysts needed to support our leaders and enable better business decisions. Since the deployment of SAP, we have deployed multiple key initiatives maximizing productivity, sales, and improving customer interactions. We have seamlessly integrated SAP

with Salesforce.com,® providing the sales team transparency into their opportunity pipeline as well as realtime sales account management via any mobile device. In 2011, we implemented SAP’s Supply Chain Management (SCM) component. SCM provides us with the foundation required to improve our order-todelivery processes and ensure on-time delivery while effectively managing working capital. SCM contains SAP’s Advanced Planning Optimization module (APO), which enables inventory forecasting based on historical demand and seasonality. As a result, we have maximized our turns and fill rates while reducing safety stock inventory. Our-state-of-the-art Avaya contact center solution leverages computer telephony integration (CTI), integrated workforce management, one-touch customer interaction and innovative call analytics and reporting. This solution provides a 360-degree view of our customer interaction through the contact center, providing the

information we need to more effectively satisfy our customers’ ever-changing requirements. Our 40+ distribution centers are equipped with state-of-the-art technology supporting more than 20,000 orders per day with 35,000 customer deliveries. Seamless integration of SAP, our warehouse conveyor system and our voice-directed warehouse technology has enabled even greater picking and put-away efficiency and accuracy while reducing labor costs. Expanding beyond the traditional brick and mortar distribution method, our EDI (electronic data interchange) capabilities allow us to enhance our SKU assortment on our www.hdsuppplysolutions.com website to more than 1 million products. Through our “Extended Inventory” program, we have reduced the need for additional warehouse space by shipping directly to our customers from our vendors.

UNLEASHING OUR FULL POTENTIAL

Serving Our Customers To enhance our customers’ buying experience and build strong alignment, Facilities Maintenance utilizes Web, mobile and cloud technologies to provide our customers with the best information and products to serve their specific needs. Such tools include Endeca® for website searching and Rich Relevance for enhancing search by providing up-sell and cross-sell items, resulting in a 5% increase in sales. We also take advantage of website analytics and survey tools to ensure we are constantly evolving to provide our customers the information they need, how they need it, for a better, faster shopping experience. We deployed a mobile website to enable our customers to place orders from their mobile devices as they walk their properties and identify items needing to be replaced. Device-specific mobile apps will be available in 2013 to bring even more flexibility and capabilities to our customers.

integrated our backend SAP systems with Salesforce.com to enable access to customer information, including sales and payment history. Most recently, we developed an application to enable our sales team to enter quotes for large projects on their iPad tablets, reducing the quote creation process from weeks to minutes. We created a mobile app on Salesforce.com’s Force.com® platform that identifies underperforming SKUs, providing our sales team the information they need to promote items the customer needs, but has been purchasing elsewhere. Finally, we have developed a mobile application within Salesforce.com for quoting large renovation projects. This application is integrated with SAP Project Systems and APO, and allows for in-the-field renovation quotes, inventory allocationand project-based kitting. Our goal is to enable our sales team to access the best information to help them serve our customers. To provide another vehicle for customer feedback on our products and services and allow us to be more responsive to changing customer needs, we are currently evaluating an Infrastructureas-a-Service (IaaS) solution to enable low cost, faster speed-to-market for technology proofs of concept.

Operational Excellence

In 2008, the Facilities Maintenance sales team engaged Salesforce.com to provide sales force automation (SFA) tools to our sales force. The Salesforce.com platform has become an integral tool for SFA within Facilities Maintenance, and the demand for timely data has grown significantly. To address this demand, we have

To enable our multi-channel customer contact processing and reporting needs, we replaced our antiquated analog technology phone system and multiple third-party call center management tools with state of the art Cisco® VOIP and Avaya Call Center technology in 2012. With incredible teamwork and collaboration, we migrated more than 1,000 contact center associates across 10 contact centers to the new system in less than four months. The project delivered Integrated Voice Response (IVR) for customer self-service and a standard

platform to record, monitor, analyze and report inbound / outbound (Email, Text, Chat, Voice, Fax) customer interactions and drive “Voice of the Customer (VOC)” initiatives. Computer telephony integration (CTI) was seamlessly integrated with our SAP CRM, ERP and BW/BI backend systems. The new speech analytics software provides new, previously untapped insight into the voice of our customers, and Call Back Assist provides an exceptional customer experience, especially during peak times. To support the tremendous growth in our distribution centers (DCs), we supported the transition of 39 DCs to SAP’s ECC Warehouse Management (WM) system, the expansion of 6 DCs, and the setup of 8 new DCs (including 3PL). Leveraging SAP, we implemented warehouse management technology across all locations to provide efficient pick, pack, and ship functionality, streamlined receiving and put-away capabilities and delivered robust customer returns processing. Implementation of Lucas Systems® Pick-to-Voice (PTV) technology at 19 DCs enabled increased picking efficiency, improved picking accuracy and reduced paper consumption. Most recently, we installed The Numina Group’s® Warehouse Control System (WCS)™ to be fully integrated with our

conveyor systems, Lucas PTV and SAP to further enhance pick, pack and ship processes. We leverage Numina’s WCS conveyor technology to automate the preparation of packages for shipment through automated weight and shipping cost calculation, robotic label printing and application and intelligent package routing to appropriate shipping lanes. With a commitment to our customers for 98% next-day shipment and on time delivery to our customers, dependable printing on our 1000-plus printers every day is paramount. In our peak season, we process 170,000 print jobs daily to support order delivery in our DCs. To support this printing volume and to reduce the risk of printer outages, we implemented Levi, Ray & Shoup, Inc.’s® Managed Print Services (MPS). This tool allows our DC associates to reprint without IT intervention. Utilizing MPS, the IT Help Desk can support our print environment more effectively, thereby reducing print-related issues by 80%.

Building Scalability For Growth In collaboration with our Enterprise Infrastructure team and facing accelerated business growth, high transaction volumes and the need for a stable, scalable technology environment, we have implemented a high-end industry standard 64bit server architecture. This new footprint significantly increased system performance by more than 45%, reduced maintenance cost by 35% and, most importantly, ensured increased system stability and availability.

Continuity Planning and Execution), Security and Risk Compliance, and Quality Assurance (Change Control, Testing, and Defect Management). With a foundation of highly-available hardware for our core SAP system and near real-time remote data replication, we are able to deliver more than 50 projects each year, including critical upgrades to keep our technology current. To continue delivering operational excellence, ensuring high availability, recovery and quality, our planned enhancements during the next few years include: assessing new requirements and methodology for recovery; analyzing the use of Impact Analysis tools to perform focused testing; ensuring new types of risks and threats are identified and addressed early; and enforcing continual review and adoption of IT and industry best practices. Above all else, the team’s focus is providing our customers great value and a seamless experience to buy from HD Supply.

By investing in our reliable, scalable technology during these past five years – all while creating a highlycollaborative, customer-focused team of business and technology experts – we are well-positioned for business growth and the needed agility to Unleash our Full First Choice Potential!

To ensure our associates have a repeatable, reliable experience using our technology, our FM IT Operations team is “Always on the Job”. The focus of this team is to provide governance and oversight of our core systems and services, including: IT Operations (Incident Response; Root Cause and Trend Analysis; Batch Job Oversight; Monitoring and Alerts; High Availability; Disaster Recovery; and Business

UNLEASHING OUR FULL POTENTIAL

White Cap

HD Supply White Cap is the nation’s leading distributor of specialty hardware, tools and materials for large and medium-sized contractors. Our extensive inventory, combined with will call, site delivery and direct ship options, enable us to deliver the products you need when and where you need them. Additionally, our team of more than 500 outside account managers are experts in their field, so you can rely on us for professional service and solutions. We bring comprehensive knowledge of concrete, tilt-up, bridge, highway, grading, waterproofing, residential and commercial construction practices to provide the expertise you expect and the products you’ve got to have to get the job done.

The “White Cap” name originated from one of the first products sold – an extruded plastic expansion joint for use in concrete decks that surrounded in-ground swimming pools. The first White Cap branch was opened in 1976. Since that time, White Cap has grown through organic expansion and 16 significant acquisitions to become six times larger than the next closest competitor. Mike Vitale VP Information Technology

After becoming part of the HD Supply family in 2007, the White Cap IT team has embarked on a foundational journey to upgrade businessspecific technology, leverage the available, centrally-managed technologies and services and integrate into enterprise networks and data centers. This journey is nearly complete, as we

have eliminated 28% of redundant applications and technologies, transitioned from a colocation data center to the HD Supply data centers, integrated into HD Supply networks, security, email, help desk function and collaboration services, and have leveraged the following enterprise applications: • Enterprise Data Warehouse & MicroStrategy® Analytics • Documentum® AR/AP Imaging • Novatus Contract Management™ • Oracle® Travel & Expense, General Ledger and Human Capital Management • ADP® Taxware • IBM WebSphere Commerce®

During this foundational journey, White Cap IT delivered significant new applications for supporting Trade Segment Sales Opportunities, Credit/ Collections and Dispute Resolution, Discrepant Invoice Resolution and Self-Service Portals for both customer invoice statements and associate commissions/financial statements.

Configured and deployed SalesForce.com® tools to national account managers and market sales specialists to improve productivity and effectiveness of account, contact and opportunity management.

Building on this foundation, the White Cap IT team is replacing the aging legacy business platforms with scalable, efficient and feature-rich applications to support the business’ strategic initiatives and growth objectives. Key business system implementations include:

The White Cap IT team is comprised of 22 internal and 7 external (global) team members. The internal team has a strong business focus and is ideally positioned to service the specific needs of the White Cap client base.

Build and deploy Oracle® Ebusiness Suite ERP system with planned deployment to 136 branches and our 2500 associates by the end of 2013. Investment in new tools and process management has enabled White Cap to more efficiently service customers than ever before. By leveraging the Oracle solution and driving pricing discipline, we have achieved marked improvement in gross margins. In addition to our catalog publications, targeting specific customer segments, we launched IBM Websphere Commerce for E-Commerce, replacing the legacy website with enriched product data and a simplified user experience to become the preferred online destination for professionalcontractors. The new site enables White Cap to convert 120,000 monthly visitors into satisfied customers. We delivered Oracle Product Data Hub to improve the quality and management of product information. The new hub supports central management of product attributes and classification, and provides the ability to support rich market content.

Technology is viewed as a strategic enabler for White Cap growth intitiatives, and plays an integral role in the long-range planning cycle.

A technology roadmap, developed in partnership with senior business leaders, captures and drives the multiyear investment plan for new business capabilities. The IT Team uses formal program management coupled with best practices from other HD Supply teams for best-in-class execution and delivery. Some leveraged best practices include FM’s implementation practice with SalesForce.com and Websphere Commerce. Give-backs to other teams include best practices on ERP deployment and product data management. Additionally, White Cap IT has utilized technologies developed within the enterprise to accelerate the transformation to top quartile technology platforms – including Oracle EBS, IBM Websphere Commerce, and MicroStrategy. The technology needs for 2013 extend the current business trajectory and enable strategic growth, as well as introduce additional, differentiating business capabilities. We are well on our way to First Choice Success!

Business Area

Technology Needs

1. Business Growth

• Mobile eCom Platform • Mobile Sales Applications & Self-Service Tools

2. Gross Margin Enhancement

• Pricing Management Tools • Supply Chain Planning & Management • Vendor Portal & Vendor/Customer Communications • Product Data Quality Mgmt

3. Training & Development

• WC 20/20 End User Training Tools • User Self-Service Portal

4. Process Improvement

• Complete WC 20/20 Regional Deployments • Digital Signature Capture • OBIEE Analytics & Reporting

UNLEASHING OUR FULL POTENTIAL

Power Solutions Darla Lentz VP Information Technology

HD Supply Power Solutions offers the industry’s most extensive and dynamic portfolio of products, services and solutions for the Public Power, Investor-owned Utilities, Construction and Industrial markets. Through our collaborative approach, we create tangible value for our customers by driving down their supply chain costs and delivering innovative offerings for navigating an evolving marketplace. Our strong supplier relationships enable us to provide highquality products with competitive pricing and exceptional customer service.

Power Solutions is made up of more than 40 acquisitions, most recently the combination of HD Supply’s former Electrical and Utilities divisions. Our Power Solutions IT team is laser focused on providing our customers with the most advanced innovative customer solutions offering in the industry. Every member of our team is in sales, with more than 92% of our team involved in direct customer-facing initiatives. IT is always at the table to assist in securing strategic customer alliance deals and grow existing accounts.

Our IT team consists of 33 highly-skilled individuals who possess both technical and business knowledge. This team is geographically dispersed, with a majority of the resources residing in Orlando, FL, and Corinth, TX. Our success is the result of a dedicated and collaborative team that strongly believes in living our First Choice Success Pyramid values every day. HD Supply Power Solutions is currently operating on two ERP platforms - Epicor’s Eclipse™ for the Construction and Industrial verticals and Infor’s® SX.e for our Public Power, MRO and Investor-Owned Utilities verticals. We leverage our enterprise IT teams to manage our infrastructure, providing exceptional system availability.

Power Solutions’ comprehensive IT solution offerings combine leading-edge technology with proven best practices. Through our Advanced Customer Solutions offerings, we help customers maximize the efficiency of their supply chain through optimized data management. Our customized solutions are designed to lower costs, eliminate errors, enhance visibility, reduce risks and improve cash flow management across the supply chain. At Power Solutions, we pride ourselves in solving our customer’s material management issues. We have distinguished ourselves from our competition through innovative solutions around Material Management Laydown Yards, Reservation Center, Mobil Warehouse Manager, Virtual Warehouse and Vending Machines.

Laydown yards are setup at various points along a stretch of transmission line to enable quick access to needed tower construction and maintenance products. Customers quickly realized that while contractors were skilled at construction and maintenance activities, inventory management was a weak link in the supply chain – resulting in misplaced materials and product reorders costing millions of dollars. Power Solutions IT took on the challenge and developed a Web-based tracking solution that utilizes radio frequency (RF) bar code scanning in the field. The solution has generated a lot of excitement and we have seen multiple new business opportunities with other customers.

The Contractor Reservation Center was developed to enable “smart scheduling” for transmission and substation orders at one of our newest customer alliances, and is another IT-enabled solution that has been adapted for a growing list of sales opportunities. This solution provides Web-based, work order reservation integration with the customer’s Warehouse Management, ERP and other critical business systems. Using a single portal view, customers are now able to manage their full work order pipeline with contractors, including materials forecasting, delivery schedules, inventory levels and lead times. It is the customer’s one-stop shop for contractor work order management, from initial job requisition all the way to job close.

The Virtual Warehouse and Mobile Warehouse Management solutions optimize the often troublesome inventory management piece of the supply chain, integrating technologies including handheld RF wireless barcode scanners and Web-enabled visibility to manage end-to-end inventory requirements. With the ability to interface with Power Solutions’ SX.e ERP and customer systems, HD Supply effectively manages business-critical inventory for customers. This mobile warehouse management approach enables real-time inventory processing – from auto-replenishment and materials assignments (put away, bin assignments) to online visibility for inventory locations, counts and usage. Couple these advantages with the ability to reduce inventory carrying costs, manual processes and paperwork, and it’s clear to see the benefits gained from the Virtual Warehouse solution.

Industrial Vending offers customers a self-service inventory solution that improves accessibility to products, accountability of material and usage and plant or warehouse productivity. This solution provides customers access to materials and equipment within the employees’ work area, optimizing “wrench” time for employees and increasing material availability. Inventory distribution and usage can be allocated by user, department or jobs to provide enhanced inventory management reporting and metrics. There are several vending configurations available to customers, including devices that include weigh station and RFID technologies. Industrial vending provides an automated, integrated dispensing solution that transmits material consumption and usage data directly to HD Supply from the device, including issue, allocation, inventory replenishment, purchasing and invoicing information.

These solutions are a few highlights of the Advanced Customer Solutions offering that delivers a competitive advantage for the Power Solutions team and our customers. Our team works diligently to develop informational documentation about our IT services, which serves to educate the Power Solutions sales force on business technology solutions and provides customers with a guidebook for success. We have achieved extraordinary success by working directly with our sales and operations teams to provide innovative solutions that address our customers’ needs. We are afforded this luxury because of the incredible support we receive every day from our extended enterprise team and the other lines of business. We are fortunate to have the greatest infrastructure, security, sourcing and enterprise applications teams providing us with world-class capabilities, and we showcase these advantages in every customer sales presentation – which often helps us close the deal. We are very excited about 2013, as we have several key initiatives to help revolutionize our business. We are launching new web capabilities, master data management and an ERP evaluation that are all dedicated to driving incremental revenue, improving data quality and driving operational efficiencies. This year, we will stay focused on executing against our Essential Priorities and living the First Choice Values each and every day.

UNLEASHING OUR FULL POTENTIAL

Waterworks

HD Supply Waterworks is the nation’s largest distributor of water, sewer, storm and fire protection products. Our comprehensive technology and supply chain integration drives efficient and accurate order fulfillment with a 95% fill rate. Whatever the project — from water and sewer line installation, storm water retention systems and water/wastewater treatment plant construction to fire protection equipment and services — HD Supply Waterworks offers a full array of capabilities to serve you.

Making Waterworks the First Choice of our customers is our top priority. We accomplish this by partnering with business leaders throughout HD Supply to leverage technology in a way that creates a sustainable competitive advantage. Our end-to-end processes, enhanced by our tightly integrated applications and analytics, facilitate lean internal operations while delivering exceptional service and significant value-add to the customer. Wayne Short VP Information Technology

Our highly-experienced team relentlessly pursues the elements of the First Choice Success Pyramid, with a focus on Hard Work, Winning Attitude and Competitive Greatness.

We are committed to doing it right the first time, continually listening to our customers and partnering with our business leaders to drive growth, geographic expansion and lean & dynamic processes. The centerpiece of our technology platform is the IBM® Power7 System, which serves as the foundation for the Mincron Hardgoods Distribution ERP® application suite, which has served the business very well for many years. Mincron is a mature, stable and highlyintegrated set of applications that allow our business to operate with maximum efficiency and low total cost of ownership.

We are passionate about providing the best service in our industry at the lowest total project cost to our customers. To achieve this, we have partnered with many of our customers to develop and continually refine our Customer Advantage Programs (CAPs), which have been enhanced routinely in recent years. The CAPs suite is a full online solution that reduces our customers’ total cost of doing business. These programs are tailored to meet the unique needs of each customer, which can range from simple online correspondence all the way to complex procurement support and distributor-managed inventory. In all cases, these programs have been designed to keep HD Supply the First Choice of all of our customers.

SUPPORTING THE SALES TEAM

SALES GROWTH INITIATIVES

LEAN AND DYNAMIC PROCESSES

We are intensely focused on driving

Since 2008, much of our growth has been driven by our four product-based sales initiatives. We have partnered with our initiative leaders to develop new solutions to support this growth. During the past two years, we helped our meter specialists introduce new methods for demonstrating the capabilities of metering technologies and we helped our treatment plant team improve their quotation process.

In addition to our tireless focus on sales growth and geographic expansion, we have worked hard to

organic growth at least 2x that of our competition. Because most of our

revenue is subject to competitive bidding, our bid applications are critical to our success. Our proprietary PowerScope® bid application is tightly integrated with Mincron and has allowed our sales force to efficiently produce highly professional bid packages for over a decade. We have recently launched a project to add significant new functionality to this tool in a streamlined web-based interface. Another important tool that allows our branches to evaluate wins and losses and continually strengthen our competitive position is our proprietary Bid Tracker application. We have made several important upgrades to this tool the last few years and we continue to refine it. In addition, we recently implemented Quote Express, an innovative digital takeoff solution which dramatically improves our efficiency in converting construction drawings into material listings, while further increasing the professionalism of our bids.

As we continue to expand our Fusible Plastics initiative, we are evaluating various rental, fabrication and service bolt-on solutions to further accelerate our rapid growth in this area.

ACQUISITIONS AND GREENFIELDS One of our core competencies has long been the integration of acquired businesses. During the past seven years, we have integrated seven acquisitions, totaling 141 branch locations, including the recent Water Products acquisition. We have also launched 14 new greenfield locations in the past two years, with many more planned in the coming months.

drive lean and dynamic processes

throughout our organization. During the past few years, we have made numerous technical enhancements to CAPs and launched the new Distributor Managed Inventory module. We have also partnered with HR and Marketing to train every sales representative on these programs to drive further customer adoption. We have also partnered closely with business leaders and subject matter experts across HD Supply to enhance our key back office systems. We implemented the SAP® Business Planning and Consolidation (BPC)

application for financial reporting and analysis; the Synygy® application for incentive compensation; and numerous process automation tools to prepare for our continuing growth. By leveraging the entire HD Supply organization to build simple processes and put the right information in the hands of the key decision makers, we will continue our relentless pursuit of perfection.

UNLEASHING OUR FULL POTENTIAL

Creative Touch Interiors ColorTrac, our next generation Design Center Selection tool, lets us focus on selling upgrades to the customer by making the material selection and pricing simple and fast.

Creative Touch Interiors (CTI) is a leading provider of interior finish solutions to the construction industry. CTI offers turnkey project management, supply and installation of multiple interior finish options and comprehensive design center services. CTI has approximately 60 design centers in 19 states and provides services to 38 states. CTI is dedicated to providing the finest quality products and installation services to residential and commercial market segments. Our project portfolio includes single-family homes, multifamily, senior living, military, hotels, stadiums, office buildings and apartment complexes.

CTI touched nearly 30,000 new residential homes in 2012 and recently expanded into the Senior Living customer segment, providing room and facility renovations to large property management companies looking for a national partner Brad Cowles who can streamline VP Information Technology and standardize their construction processes. CTI renovated more than 5,000 units in 2012 and expects significant growth in this segment in 2013.

The Digitization Journey Begins (2005 – 2007) CTI was formed through the union of eight acquisitions made from 2002 to 2006 . SAP® was chosen as the operating platform to consolidate the business, and the order-tocash and finance processes were successfully migrated to the new platform by 2007. CTI experienced a radical erosion of its market beginning in 2007, reducing market opportunity by 80% by 2011. Further efforts to digitize the front end of the CTI process (Sales, Estimating and Selections) were put on hold as the business focused on stabilizing in a diminishing market.

Digitize, Automate and Mobilize Although the residential housing market reached its bottom in 2011, we once again

began to invest in digitization, knowing it would be crucial for improved profitability once the markets returned. Technology is a critical enabler for the scalability of CTI, and these investments provide very strong rates of return. To execute at a higher level of investment requires a different team structure with more emphasis on internal talent (35% of our team) possessing technical skills in SAP, Java™, Web and Mobility. After moving the Bid and Estimating process into the core SAP system during 2011, a multigeneration plan to “Digitize, Automate and Mobilize” was launched to eliminate manual processes and create a seamless, integrated selling capability. The bid is a complex pricing scenario, making assumptions about future business volume and customer choices across dozens of trades and thousands of materials. In addition, the estimations are computer-aided design (CAD)-based engineering “take-offs” of builder floor plans, often containing multiple elevations and dozens of potential structural options. One of our most distinctive competitive advantages is our CTI Design Center, which delivers skilled interior design assistance and extensive product lines through a network of more than 50 state-of-the-art facilities. However, technology to improve the customer experience in this area had been difficult to develop in the past, particularly due to the high degree of variation across customers and regions. With the digitization of the Bids and Estimates, a new type of selection tool has become possible, and we call it ColorTrac.

CTI Goes Mobile with FieldTrac

ColorTrac brings the latest in modern Web application design to the user, including suggestive search, personalization and a rich application interface which requires no scrolling. Making it easy to host a design session with a customer allows our design team to sell more upgrades, improve overall business performance and leads to higher home appraisals and reduced time on the market.

Leveraging the SAP Platform: Scheduling Cockpit The SAP backbone provides a powerful platform to improve internal productivity and external customer service. The launch of the scheduling cockpit is a great example which delivered two key benefits: 1. Simplified the scheduling process by bringing together the SAP views and transactions needed to maintain installation schedules in a highlyproductive, intuitive user interface. Productivity is increased by as much as 40%, and the added capacity allows us to extend the planning horizon from two to about six weeks while also increasing the manageable lot count by the scheduling team.

One of our most important customer facing functions is Field Management. Nearly 80 individuals are responsible for the oversight of the product we install in 30,000 homes each year. Until now, these Field Managers (FMs) relied heavily upon trips to the branch to print reams of paper and their cell phones to call order-processing to get access to information while in the field. In partnership with the Enterprise Applications team, CTI delivered the company’s first custom native iPad® application – FieldTrac – which puts the power of SAP and our document imaging system into the hands of the FMs. The application allows them to avoid at least one trip to the branch every day, keeps them from tying up an order processor with phone calls and gives them a confidence and service capability that is immediately visible to our customers – resulting in at least a 10% productivity increase!

Building Technology that Sells: Senior Living Integration CTI has diversified its end markets by leveraging our core strength of turn-key product and installation in a new customer segment: Senior Living. Large property management companies in the senior living market often have difficulty managing their dozens or hundreds of properties across the country, but CTI’s national presence allows us to both streamline and standardize their renovations process. Since each of these

2. Integrated with builders’ own construction management systems, allowing schedulers to simply review and approve schedule information instead of manually entering it. After only six months of deployment, we are receiving nearly one-third of our schedule updates via these integrations, with more planned for 2013.

1 2002: Floors Inc, Floor Works, Arvada Hardwood Flooring; 2004: Creative Touch Interiors; 2005: Grand Floor Design, Landmark Interiors, Traditional Floor Covering; 2006: Rice Planters Carpets

renovations are small and fast (with a 72-hour cycle time in many cases) the process has to be nimble and efficient. To meet our customers’ needs – and in collaboration with the enterprise IT team – we developed the Senior Living Integration platform, which offers two ways to do E-Commerce: (1) A selfservice Web portal with ordering, inquiry and reporting capabilities, and (2) a direct punch-out integration for large customers with centralized purchasing platforms. This platform has grown to nearly 400 orders per month and has captured nearly $6M in revenue since its launch in May 2012. It has been used heavily in the sales process, proving to be a key draw for new customers who recognize the ease with which they can digitize their own renovations process. The platform is truly an industry-unique solution and a key competitive advantage.

What does the future hold? Digitization continues to hold incredible promise for the scalability and enhanced profitability of CTI. Sales bids have been enhanced with a richer pricing model using the Master Price Sheet concept, allowing us to bid more rapidly and accurately while maintaining flexibility in our design center merchandising. Estimation 2.0 will improve speed and accuracy and will allow window take-offs to be digitized for the first time – a key enabler for CTI’s continued growth in the profitable window coverings segment. Our Design Center technology will also be a major focus, with new offerings for our customers including online scheduling and “ColorTrac SaaS (Software as a Service)”, where we will allow builders who run their own design centers to use our selection technology, locking us in tightly with the builders’ processes. FieldTrac will also continue to be our mobile focal point through 2013 while we seek out the next major opportunities for mobility in our design centers and with our sales teams. UNLEASHING OUR FULL POTENTIAL

Crown Bolt

Crown Bolt is one of the largest retail consumer hardware suppliers in the U.S. With four strategically placed distribution facilities in the U.S., the business offers delivery to any point in the country generally within 24 hours. We carry over 5,000 parts in our standard inventory with most items available in large and small quantity packaging.

We develop systems and technologies that continue to provide advancements in business operations and make us a world class distribution organization.

Our Team

Jeff Lavelle Senior Director Information Technology

We have a highlyqualified, dedicated team of 11 technology professionals located in Aliso Viejo, CA, to support distribution centers located in California, Georgia, Tennessee and Pennsylvania, as well as overseas in Shanghai and Shenzhen, China. Crown Bolt provides program development, management, sourcing,

packaging, distribution and in-store services to the home improvement, industrial, commercial distribution, industrial OEM and MRO industries. We have served our primary customer â&#x20AC;&#x201C; The Home DepotÂŽ - for more than 30 years, providing 5,000+ SKUs and weekly in-store service. We sell and service other retailers in North America, as well as our other HD Supply businesses.

Information Technology and Systems The key systems support the international distribution network. The majority of the product we purchase is sourced from China and

we process these products through our cross-dock distribution centers (DCs) in China. Product is palletized, licenseplated, containerized and shipped to our DCs in the U.S. Customer shipments are processed through the U.S. DCs on a daily basis. Store shipments coincide with our merchandisers onsite presence so they can stock our product on the shelves and place a new order for the following week’s delivery. The systems and technology in place to support the process include: • JD Edwards® ERP system •M inerva® Associates Warehouse Management System (WMS) – Automated Storage and Retrieval Systems • MicroStrategy® BI • EDI • RF Technology – DC systems and instore wireless devices There have been many key accomplishments and innovation over the years, including: • 2007: Developed and deployed MicroStrategy as a Business Intelligence software system allowing for better business decisions to be made with real-time data

• 2009: Enhanced DC capability with automated conveyors and sorting lanes • 2009: Developed software to operate on a Motorola® RF handheld device for wireless in-store service and deployed more than 700 MC75 devices, realizing significant productivity gains • 2010: Further enhanced the WMS by deploying the Lightning Pick Pack-toLight™ sorting system that improved productivity and picking accuracy • 2010: Developed software to be used on in-store handheld devices that would facilitate ordering product to the rate of sale, allowing for a better inventory position for the customer

Plans for the Future Key projects in 2013 are to upgrade the JD Edwards ERP system to the latest Web-based version. This will be a companywide, cross-functional initiative. Another key project is to replace our current WMS with a world-class, advanced WMS from Red Prairie®. This system will provide productivity improvements and features supported by international standards. Both of these projects are well underway. Working as ONE TEAM is a critical part of our First Choice Success!

• 2010: Performed the data center move from California to the consolidated Orlando data center, providing a standardized platform to support • 2010: Deployed survey software to the field devices to better manage instore operations • 2011: Implemented ForecastPro® to support improved inventory management capabilities • 2012: Upgraded MicroStrategy to the latest release

• 2008: Upgraded EDI capability to automate transaction processing

• 2012: Upgraded RF software to the latest release

• 2008: Developed a Supply Chain portal to better communicate with suppliers on quality and delivery performance

• 2012: Upgraded all DCs network systems and deployed new Motorola RF handheld devices

UNLEASHING OUR FULL POTENTIAL

Canada

From infrastructure and construction to lifetime maintenance, HD Supply Canada provides professional customers with the products, services and expertise they need to get the job done. As one of Canada’s largest industrial distributors, we provide 360° solutions for every phase of the professional project lifecycle.

Since many competitors can sell the same products as we do, it is critical that we find ways to differentiate ourselves through First Choice innovation and services.

Jack Hahn Director Information Technology

With the majority of my team based in Toronto, Ontario, Canada, we currently run dedicated systems to support our Brafascosm and Litemorsm business units and provide ERP services and support for the FM Canada business while leveraging enterprise systems and the corporate infrastructure. When acquired, Litemor was running 12 standalone ERP systems

located in 12 different locations. Today, we run one instance of InforTM SX.e v6.0 to support both Litemor and our FM Canada business. With the 6.0 version upgrade in 2011, we delivered standardized processes enabling improved business operating efficiency. When Brafasco was acquired in 2005, the hardware was housed in a closet providing for no disaster recovery (DR) services and no redundancy! Today, we run all systems out of our Orlando and San Diego data centers, providing for proper DR and proactive management of our entire network. In 2006, we acquired CTF Supply and integrated that business into Brafasco, using our Microsoft® Great Plains ERP solution and retiring the CTF P21 ERP solution.

Customer Innovation To improve our customers’ shopping experience at our 40 Brafasco, high walk-in volume locations, our team built system-integration between Litemor Lighting and Brafasco Industrial, allowing for a greater product offering to an enlarged customer base across both businesses. Since many competitors can sell the same products as we do, it is critical that we find ways to differentiate ourselves and offer varied options to buy from HD Supply Canada. At our key customer sites, we have deployed Vending Machines to provide products on-demand. In addition, we have many Stock-N-Lock setups at job sites allowing for off-hour replenishment and product availability through managed inventory for our customers. The ability to react to Government Regulations in an expedient manner is yet another way we gain customer loyalty and become a First Choice supplier. When a new eco fee (environmental) regulation was required for products being shipped out of Ontario in 2012, we implemented a solution to provide government reporting so our customers were in compliance. The solution was adopted by our vendor partner, Infor, and became part of their standard software in the Canadian SX.e-installed base. Additionally, providing solutions that meet language compliance regulations has allowed us to open up new locations in Quebec while meeting the needs of existing locations, providing for selling opportunities across all HD Supply business units.

Operating Excellence Being a part of the HD Supply (HDS) family is a big advantage! By leveraging

a Power Solutions’ MobileFrame® technology solution at no additional cost, we were able to provide a wireless handheld capability very rapidly to our distribution center team to effectively relocate and reconfigure our warehouse. This delivered increased productivity, more accurate inventory, lower shrink and improved picking and put-away processes. technology to aid our sales team, to enable our sales team to increase sales and margin and to streamline the sales process to deliver First Choice performance.

Other operating improvements delivered during 2011 included:

orkflow for new product and W inventory planning requests

se of counter scanners in all 40 U locations for quicker service to walk-in customers

ricing Simplification to reduce P quote times for our Outside Sales Reps and consistent pricing across all 40 locations servicing 60% walk -business

ption Selling to support O portfolio selling

eb Inventory Lookup across W Canada LOBs

In 2012, to help our Sales team better serve customers and drive organic growth, we collaborated to build new tools and solutions. Historically, our sales team had independent solutions to keep track of customers and their requirements. By deploying Salesforce.com® as a productivity tool and implementing process discipline around Customer Relationship Management (CRM), we have improved productivity around call management and transparency to sales pipelines, portfolio opportunities (as noted on the Product Category sales by customer chart), market share and the overall process around sales management. We have recently launched visualization graphics using VISUALFORCE™

Best Performance Translation is a powerful opportunity for Canada. For example, by leveraging our Enterprise services, we not only divested our SESCOSM business seamlessly, but generated revenue by providing an application-hosting service to the buyer! By leveraging our hardware investment at the Global Support Center (GSC) and taking advantage of the new virtual machine and Linux™ technologies, we receive greater processing power and lower costs! By depending on our Enterprise Help Desk team to support our 500 associates, our Canada IT team has been able to deliver on more business-critical initiatives. In 2012, we were able to leverage best practices from our HDS family in the areas of: Tax Compliance using ADP® Taxware; AR Lockbox and imaging automation shared at the Orlando GSC; truck-routing and signature-capture by our drivers using the Transportation Management System Routing system; Cisco® phone system; product data management; Microsoft SharePoint® for document and project management; and MicroStrategy® to sunset older technologies, deliver a consistent look and feel on our intranet and simplify enterprise communications. Our focus in 2013-2014 is the integration of Brafasco and Litemor into one ERP solution, increased branch operating excellence and sales force effectiveness, and E-Commerce capabilities to broaden our services to our customers! UNLEASHING OUR FULL POTENTIAL

Repair & Remodel

HD Supply Repair & Remodel is a leading California specialty retailer providing home improvement products and building materials to Remodeling Contractors, Tradesmen, and “Do It Yourself” Customers. HD Supply Repair & Remodel also supplies products to the rapidly growing single and multi-family rental markets with an emphasis on foreclosed, deferred maintenance and investment properties. With California’s largest selection of doors, windows, cabinets, and building materials, and a unique drive-thru lumberyard, HD Supply Repair & Remodel is your First Choice.

Our Company

Jody Porter CFO & VP Information Technology

HD Supply Repair & Remodel (R&R), headquartered in Sacramento, CA, is a leading home improvement and building materials supplier catering to small remodeling contractors and tradesmen. Each warehouse location features a convenient, no-frills “wholesale to the public” shopping experience, while providing a low-cost overhead structure. The operating platform at each location includes automatic replenishment, drive thru lumber yards, in-stock rates of 98%, all registers open at all times and multiple job lot product quantities on hand, leading to complete customer satisfaction. HD Supply Repair &

Remodel was created via the acquisition of Contractors’ Warehouse in 2005.

Sacramento

We have 11 retail locations located throughout California.

Information Technology and Systems The business systems in place support the retail operation, inventory replenishment and financial processes. Each system focuses on our competitive strengths: • Retail Point-of-Sale (POS) Operations: Enable our customers to check-out fast • Inventory Replenishment: Maintain our 98% in-stock position with minimal personnel • Financial Systems: Manage company finances and ensure vendor payments with minimal personnel The technologies that supports our business processes include: • Home-Grown, highly-customized inventory management and replenishment systems • SDI ISS60 POS system, supported by Electronic Cash SystemsSM credit/ debit card processing software • Biometric timeclock solution utilizing ADP® hardware assures accurate timekeeping and payroll • Microsoft Dynamics AX® for Retail: New, fully-integrated ERP and POS solution which already powers our financial systems and will be replacing the POS, inventory management and replenishment systems There have been many key accomplishments and integration throughout the years, including: • 2004: Comprehensive upgrade of POS equipment and software • 2005: Implemented true segregation of development, test and production systems • 2006: Implemented automatic pool replenishment, extending our

automatic replenishment mechanisms to international container purchasing • 2007: Improved analytical review of merchandise profit efficiencies • 2008: Migrated central system from R&R headquarters to central HD Supply data center for improved environment control and support • 2009: Integration with HD Supply corporate Data Warehouse • 2009: Major improvements to inventory projections and the ability to forecast, avoiding stock-outs • 2010: Major improvement to applying international transport costs to inventory costs, improving accuracy of past and future profit analysis • 2011: Launched migration from disparate systems to Microsoft Dynamics AX® integration for Retail ERP/POS system • 2012: Implemented Financials within the new system Our Future plans include: • Implementing POS Retail operations within the new system - Level-3 bankcard processing to reduce credit card fees - Major improvements to merchandise signage - Ability to email copies of cash register receipts to our customers - In-store ability to research and review past customer and sales activity - Major enhancements to our tool rental operations • Complete migration of all functionality to the new system

- Extensive Business Intelligence software to support faster business decisions based on both current and historical data and trends - EDI capabilities • Customer Relationship Management (CRM) capabilities Upon completion of the new ERP/POS solution, we will: • Integrate international purchasing with the corporate systems to lower costs. • Provide wireless, hand-held functionality throughout our retail stores • Provide direct, online access to customers to view their own purchasing history and allowing select customers to place orders online • Provide direct, online access to vendors to view their own history and enter their own invoices directly into our system • Expand EDI capability to a majority of our vendors • Automate the tracking of international container shipments and railcar shipments to further improve our in-stock percentages • Integration of our POS system with the closed-cCircuit TV system to reduce losses through both cashier error and fraud We are very proud to serve our Customers with Excellence each and every day and to be a part of the HD Supply Family! First Choice is at the core of our business initiatives, with an extreme focus on risk-free expansion while implementing Lean and Dynamic Processes for success!

- Wireless, hand-held functionality to speed merchandise receiving - Direct, online access by our cross-dock partners, speeding merchandise movement and improving data accuracy - Additional functionality within the automatic replenishment system

UNLEASHING OUR FULL POTENTIAL

IT Sourcing

IT is a value creation engine for HD Supply, building competitive advantage through innovation and teamwork. The foundation for this success is having the right technology, at the right Jody Fales time, at the right cost. At Director the “right cost” is where Information our IT Sourcing team Technology brings tremendous value. Our team works to seamlessly align with the best suppliers and leverage those relationships to maximize value. Our team, located in Orlando, FL, is the bestof-the-best five team members with more than 118 years of combined expertise negotiate more than 1,500 contracts per year, up from 600 deals per year in 2008. The team has been able to take on additional volume with the same cost structure delivering a 50% reduction in cost-per-deal over that period, while delivering between $8M and $12M in cost avoidance each year. Much of our annual budget is spent on telecom product and services, hardware (HW) and software (SW) maintenance, third-party labor and hardware and software purchases. We strive for perfection in everything we do:

Our laser focus on cost containment while leveraging the best solutions is enabling our team to unleash our Full First Choice Potential!

3 ZERO late renewals 3 ZERO maintenance for non-used HW/SW 3 100% agreement with Legal on contract terms

3 1 00% deals on HDS paper (vendor adoption at 80%)

with HDS IT strategy The team has delivered on several key innovations and operational improvements, enabling our low-cost structure and high performance by simplifying and digitizing processes, eliminating waste and delivering value every year, every day, in every deal. In 2007, in partnership with our Legal team, we implemented centralized management of contracts for governance and transparency, and developed standards and templates for purchase orders. We developed a strategic sourcing process that uses a three-tier ownership framework. First, each vendorpartner is assigned a primary-owner responsible for managing the relationship and vendor strategy. Second, our IT sourcing team manages the contract terms, negotiations and legal review, and third, the performance manager is responsible for overseeing day-to-day operations and execution. Preparing to win and leveraging a world-class process enables IT to deliver world-class price for performance, avoiding millions of dollars in spend.

IT Sourcing Framework

Vendor Owner

3 1 00% of deals located in Novatus Contract Management™

3 1 00% of our work is value-add (always refining)

3 EVERY deal closed with optimal legal and business terms

3 Invoice paid per negotiated terms 3E VERY strategic IT partner’s strategy aligned

IT Contracts

Performance Manager

INNOVATION TO REDUCE CYCLE TIME 3 In partnership with our Finance team, we digitized IT contract workflow with Procuri™ giving leaders 24x7 access to deals-inprocess, and then implemented a digital purchase request [PR] process for spending limit governance. Both improvements brought simplification to our processes while ensuring financial controllership.

3 T o improve speed and manage the workload, we migrated to Novatus as our digital contract repository and automated workflow management system for all IT agreements in 2010. In 2011, we implemented DocuSign® to digitize the contract signature process, reducing cycle-time by one day per agreement, eliminating 50 hours per month and 25,000 printed pages per year.

3 We recently eliminated 75 agreements by implementing a blanket-release process for a third party.

80% of our new purchases had a net 30-day payment term, but by 2011 more than 60% of our spend is now paid with terms greater than 31 days, enabling HDS to hold our cash longer.

3A s demand increased across our company, we extended our support to our Indirect Sourcing team

3O ur processes have been so successful and our partnership with the Legal and Indirect Sourcing teams so strong, Indirect Sourcing, Human Resources, Facilities Maintenance Marketing and Power Solutions Sales have adopted our tools and processes to manage their agreements! We are very glad for this Best Performance Translation opportunity that compresses cycle-times with zero incremental run costs, as a result of having negotiated enterprise use of the tool.

3W ith changes in the technology sector, we worked again with our Legal team to develop an HDS software-as-a-service standard agreement, reducing cycle-time by 62% and implementing protections ahead of the industry standard. In 2012 alone, our team avoided more than $9M in cost through strategic negotiations and seamless alignment with the best suppliers. We also support all acquisitions and divestitures within our company, ensuring HDS is protected while working with dozens of vendors and hundreds of agreements.

We have built a simple, centralized contract review and signature process using best-of-breed solutions. Today, HDS IT has a central repository of more than 2,600 active IT agreements representing 770 vendors.

BEST PERFORMANCE TRANSLATION 3 In 2009, with guidance from our Finance team, we extended vendor payment terms as a part of our contract negations. Historically,

Our key priority going forward – beyond maintaining our high level of execution – is to build even stronger partnerships with our key vendors, raising the bar and setting even higher expectations for innovation and productivity. Our laser focus on cost containment while leveraging the best solutions is enabling our team to unleash our Full First Choice Potential! We thank our business units and vendor partners for the opportunity to serve!

UNLEASHING OUR FULL POTENTIAL

FM Pick-to-Voice increases order pick accuracy

FM Launched best-in-class SAP ERP

WC E-Commerce sales up 50% with enriched product data & new website

R&R Supply Chain Automation delivering 98%+ in-stock inventory CTI Technology that sells: Senior Living driving millions in new revenue

CAN Integrated Seamless selling across Litemor and Brafasco

HR 20 HR systems to PeopleSoft

BI Enterprise Data Warehouse driving better decisions Disaster Recovery Providing Internal DR for 250 mission critical apps E-Commerce WebSphere selected as E-Commerce platform

Field Services Reduced Help Desk Cost by 2X while expanding services 3X

Server & Storage 45% Server Virtualization

Data Center Data Centers Consolidated from 23 to 2

DBA Consolidated 1,700 databases onto 50 high availability clusters

Sourcing & Supply Chain Contract Warehouse and Rebates yield $1.5M 26

IT Sourcing Centralized and digitized IT contracts on Novatus

WW PowerScope

FM E-business driving 40% of order volume

WW Rapid integration of 7 acquisitions to Mincron ERP

PS Advanced Customer Solutions Driving $130M in Sales Growth WC Launched best-in-class Oracle ERP (WC 20/20)

CB Mobile in-store solution delivers 75K hours of productivity

Collaboration Launched SharePoint for improved cooperation and teamwork

Content Management $750K bank fee savings through digitization

Business Development Day 1 integration for acquisition excellence

DataCom $1.6M annual benefits from SIP Trunking

Architecture CMDB for infrastructure transparency

PMO Executed 1,300+ projects since 2007

Desktop PC Management simplification though LanDesk and PC Images

Server & Storage 10-to-1 priceperformance with Linux

Information Security Secure with multi-layered defense: S.N.I.P.E.R

Finance Established Financial System Foundation UNLEASHING OUR FULL POTENTIAL

Enterprise Applications

Our high-performing IT Enterprise Applications (EA) team is truly a valuecreation engine!

With a portfolio of more than a 150 applications standardized on 15 technology platforms, Enterprise Applications creates value through technology standardization, reusability and best practice translation. 28

Our team provides the business transaction processing infrastructure that allows us to operate Ali Sareea as One HD Supply VP Information entity supporting the Technology corporate functions of Human Resources (HR), Finance, Marketing, Communications and Operations. The team also incubates new technologies and creates translatable platforms, driving growth at each of our business units. These platforms include Business Intelligence, Content Management, Imaging, Collaboration, Web and Mobile applications and E-Commerce. In 2007, EA consisted of multiple teams that were each focused on a primary business function. Throughout the years, the team has created a cohesive execution strategy that spans technology silos to support business growth, reusability and deployment cycle time reduction.

2007-2009: Establish a Foundation The early years were spent on establishing foundational systems as we built our independent company in 2007. The primary focus was to create systems to enable Finance and HR to operate independently and manage our business performance through an Enterprise Data Warehouse [EDW]. Major initiatives included: • Rationalized all payroll systems onto Lawson®, a single platform • Deployed Khalix® and AssureNET GL® to fulfill our controllership duties and consolidate our business results across our various general ledgers • Established a playbook for creating datamarts within the enterprise data warehouse, deploying the sales, sourcing and headcount data warehouses and created the CEO Digital Cockpit to enable an enterprise view of key metrics • Created a central real estate system to manage our 800+ locations on a single system

• Created an integrated enterprise intranet, tying each of our business intranets together with improved ease of use, associate access, information availability and communication effectiveness

2009-2011: Drive Functional Excellence Once our foundation was in place, we focused on driving enterprise efficiencies to allow us to scale the business through digitization. We deployed imaging technologies more broadly to enable financial workflow digitization. The team introduced new A/P and A/R workflow tools and GETPAID® for credit and collections effectiveness. In the sourcing and operations area, we created the contracts, rebates and eAuction tools to improve gross margin. We established a brand presence for each of the business units and HDSupply.com through updated websites. Digitization and self-service moved us closer to our paperless vision in the HR space. In late 2009, the team embarked on simplifying and optimizing the HR systems landscape by deploying an integrated Human Capital Management system using PeopleSoft® to manage the full associate lifecycle, including performance, learning and compensation.

2012-Beyond: Growth and Innovation for Competitive Advantage As we were yielding significant productivity from our foundational investments, our strategy

was augmented by focusing on innovation, growth and enablement of the sales force. This brought a renewed focus on business intelligence and share-of-wallet expansion activities, sales force effectiveness and creation of new online sales channels. The enterprise-wide inventory and customer lookup-tools brought innovation to our field teams to help them accelerate sales. We demonstrated our thought leadership in the E-Commerce and mobile space as we took our first steps in launching Whitecap.com and CTI Senior Living Portals in collaboration with our White Cap and CTI teams. We selected IBM Websphere Commerce® as the standard for E-Commerce and a best performance translation opportunity due to its success at Facilities Maintenance (FM). We now have a playbook and framework for deploying mobile devices and developing mobile applications. Enterprise collaboration took a giant leap forward with the deployment of the Microsoft SharePoint® platform and a single, personalized HD Supply intranet.

were paid under 15 EINs, translating to fully-decentralized payroll tax remittance, treasury and general accounting. Most HR processes were paper-based with no central repository of employees, and only 10% of new hires had systems access on their first day on the job. After separation, HR and IT quickly partnered together to simplify the environment, migrating all payroll systems to Lawson by 2009 and standing up several software-asa-service solutions, such as Learn.com® and SuccessFactors™, for HR compliance.

Human Resources - One System for Associate Lifecycle Management Our HRIT team provides the technology backbone for associate services at HD Supply. Our applications are used by every associate and support more than 90 integrations with our third-party HR services providers for a seamless associate experience. Although HRIT primarily supports TEAM (PeopleSoft HCM), the Learning Center (PeopleSoft ELM), and Kronos®, we also partner with HR to help ensure world-class capabilities at the lowest total cost of ownership. At startup, we supported 41 applications including 15 Payroll systems. To put that into perspective, the simple task of identifying the number of active employees required at least 15 different queries! Payroll taxes

2007 HR application stack with high variation Digitization and self-service drove paperless transactions in the HR space, including paperless paystubs and automated personnel action forms. We automated 1,000 HR transactions per day by implementing Employee and Manager Self-Service, all while empowering associates to control their own personal data for the first time! In 2009, the team began interfacing new hires from the staffing system into Lawson, enabling 90% of all new hires to be onboarded before their start

date, a productivity gain of more than $900k per year. By 2009, we retired six timekeeping applications and reduced HR systems from 41 to six!

Simplified HR Application Stack In 2010, we embarked on the next generation of our strategy to manage the full lifecycle of our associates on a single system and reduce our total cost of ownership by kicking off the PeopleSoft implementation. In 2011, the first phase of PeopleSoft launched converting 39,000 employee records and more than two million payroll data rows for a flawless go-live, with 31,000 manual payroll journal entries automated each month to business unit ledgers. PeopleSoft digitization has enabled the business to streamline the onboarding of acquisitions from 60 days to less than 14 days. We have rationalized 20 other HR applications including SucccessFactors and Learn. com to PeopleSoft, integrating the entire associate lifecycle. For the first time, HD Supply has enterprise learning capabilities, enabling Best Performance Translation and allowing our HR partners to focus on Talent, Compensation Management and Workforce Planning. HR now has ONE SYSTEM to support our “One Team. One Focus. First Choice.” mission.

UNLEASHING OUR FULL POTENTIAL

Content Management - Innovation and Best Practice Translation for Efficiency The Enterprise Content Management team has more than 30 years of combined expertise in content management, optical character recognition (OCR) and business process management (BPM). The team has been able to build and support a growing number of applications while reducing cost. Our team is extremely proud of the innovative solutions and services that have transformed content storage and retrieval and back office processes. Eliminating paper is good, but our competitive advantage has come from turning documents into transactions and automating the flow of these transactions into ERP systems using global resources.

Our team has a strong partnership with all business units, as we collaborate to understand need and then go the extra mile to provide the right solution that leverages best-in-class content management technologies. The first imaging application was actually developed in 2004 to digitize paper and enable Web retrieval. In 2005, the first AP invoice imaging solution was launched using Documentum® workflow integrated with the ERP system, creating an automated, end-to-end AP processing system. These key innovations set the foundation for best practice translation across the enterprise. Through 2010, the team implemented AP imaging systems for other Business Units including the Global Support Center

(GSC), FM, CTI, White Cap and Canada. As a result: • 5 – 6,000 invoices are processed per day across all AP imaging systems • Productivity increased 190% to 800 invoices per day per AP associate • Processing cycle time was reduced by 70%, allowing AP to retain more rebates and discounts for earlier invoice payments • Digitization of paper documents has enabled work to be performed anywhere in the world. HD Supply has recognized an $800k savings to date through process efficiencies, including use of global resources In 2007, in partnership with the HR team, the HR Imaging Solution was launched across the enterprise for digitizing and storing all associate documents. There are approximately 5,000 historical personnel documents digitized every month to eliminate the need for costly paper archival. The CTI Document Storage System launched in 2010, enabling CTI associates to digitize, store and retrieve all Job Jacket documents related to a specific builder, lot or plant. Later in 2012, we extended the functionality to FieldTrac, which enables mobile access for CTI Field Managers. In 2012, HD Supply had relied on our financial institutions to deposit and apply cash on our behalf using lockboxes. In close partnership and collaboration with Finance, the team developed a standardized AR platform to deploy AR Lockbox systems across multiple Business Units, including Power Solutions, Canada and White

Cap. As a result, we have lower operating costs, improved scalability and we “save as we grow.” Key accomplishments include: • Created a real-time bank interface to deposit and apply cash immediately to HD Supply’s bank account using XML-based Check 21 standard, reducing float by one day • Enabled $1M+ cost-out (bank fees) across all Business Units • Currently processing approximately 3,000 checks per day • Reused AR platform to implement the Rebates Check Imaging System Most recently, we have taken responsibility for the GetPaid Credit Management application currently being used by FM and White Cap. Our key priority, beyond maintaining our high level of service, is to identify new business opportunities that can benefit from content management solutions. We will continue to evaluate our existing platforms to ensure that we are providing the best solutions at the best price, as we quickly deploy solutions across our portfolio with speed and precision to deliver operating efficiencies.

Finance and Supply Chain - Foundations for Operational Excellence The Sourcing, Operations and Financial Systems team provides project management, business process transformation, software selection consultation, quality assurance

Business Intelligence - Better Information for Decision Making

services and functional and technical support across a broad platform of technologies. We support more than 20 different applications for all business units and our functional partners, including: Accounting, Sourcing, Finance, Environmental Health and Safety, Asset Protection, Real Estate, Corporate Tax and Business Continuity.

The EA Business Intelligence (BI) team creates and manages the Enterprise Data Warehouse, which also includes business unit-specific data marts. Our business teams use a reporting tool called MicroStrategy®, our data repository is Oracle and the primary data loading tool is IBM® Datastage.

Delivering Simplified, Digitized, Innovative Solutions Our Finance IT team’s primary responsibility is to support the Oracle® R12 eBusiness Financial suite of applications. Oracle R12 provides the back office technology to support our corporate General Ledger, Fixed Assets, Accounts Payable, Cash Management, Travel and Entertainment Expense Reporting, Rebates Management and Property Management modules. We also provide application expertise for Khalix, our enterprise Financial Consolidation and Planning system. Digitization has delivered significant benefits in Finance. A great example is the Oracle iExpense solution. The team transitioned various, divergent expense reporting processes (spreadsheets, emails and handwritten approvals) to an automated, workflow-driven electronic application that is fully integrated with our payroll system. The net result has been a reduction in payment delays to associates and growth of corporate card utilization by more than 64%, translating into a $212k increase in card rebates. The Sourcing Applications team partners with the Sourcing Finance teams and business units to track our 1,500+ annual rebate agreements with our suppliers, totaling more than $150M per year in rebate income. We developed and maintain the Contract Warehouse System, tracking more than 1,200 active supplier buying agreements in a centralized, workflowenabled repository representing more than $4B in annual spend. We store

Key responsibilities are:

indirect- and direct-spend data from across our enterprise in the Enterprise Sourcing Data Warehouse. Prior to automation, Sourcing Finance used a combination of spreadsheets and Microsoft® Access databases to track purchases and rebate income for 1,500 agreements. These manuallyintensive processes made us reliant on our suppliers for purchase data. Oracle Trade Management was implemented and integrated with the Sourcing Data Warehouse. This application is now used to validate rebate payments from our suppliers and has enabled recovery of rebate income exceeding $1.4M to date. The Operations team provides project management, analytical data and technical support for a variety of applications, including loss prevention, centralized freight management, disaster recovery planning, hazardous waste tracking and disposal and import quality management. Technology has been a key enabler for efficiency, including $500k of savings with the implementation of a real estate system. Freight and fleet optimization using transportation and fleet management systems has yielded $450k of savings and improved compliance with hazardous material and safety standards.

• Project-based development and implementation of new or modified information stores • Monitor and manage the daily processing of all inbound and outbound data transfers • Standardize the information through MicroStrategy dashboards and reports • Provide access to MicroStrategy to allow adhoc reporting and viewing of key performance indicator (KPI) dashboards • Provide basic training on MicroStrategy for user self-service reporting • Handle special data requests for strategic business initiatives and assist in creating complex reporting Simple, Digitized, Actionable Information Delivery Our team operates as a soft development unit creating a “data warehouse” of key information fed from business units, corporate systems and external vendors. Through our efforts, we organize and structure the information to be consumed internally by our various team members. With increased demand on information for decision making after 2007, BI capabilities gained momentum and spurred the move from a SQL Server and Teradata® platform to an Oracle environment. During this time-frame, the first-generation Data Warehouse was formed, containing key data marts of product receipts and UNLEASHING OUR FULL POTENTIAL

sales, and detailed customer and vendor information. A digital cockpit was launched to give our executives visibility to a common set of metrics – from branch to boardroom – with a single source of the “truth” in terms of data. Users could drill-down and analyze performance by customer, associate, market, product category and geographic region. By 2009, the data needs increased with additional subject areas (Inventory, Headcount, Freight, Fleet, AP Invoices). In 2011, we saw the BI platform utilization increase by 25% and our volume of users expand by 15%. Improved inventory management and gross margin (GM) acceleration were enabled by improved analytical tools, in addition to understanding market opportunities. We also began reporting for our First Choice – One Team Selling initiative. In early 2012, we executed a flawless upgrade across the BI platform, increasing capacity by 300%. The team partnered to build two new information delivery platforms with the Field Performance Mobile application and the Enterprise Customer Lookup tool via the Web. Currently, the BI platform processes 200+ jobs daily with more than 45 different types of inbound or outbound file types. To date, the Data Warehouse contains more than 700 Gb of raw data that supports more than 1,000 dashboard views per month and more than 20,000 reports per month. Key business information such as vendor rebates and daily sales reporting rely on the automated BI platform to consistently deliver information when needed. Since 2010, as one of the early adopters of the UC4™ job execution and monitor technology, we collaborated with our Infrastructure team to establish standard techniques in exception reporting and job monitoring. By using rigorous development and implementation practices, the team has

minimized the number of production errors and user disruptions. This framework has also been shared as a best practice with many of the development teams in the Enterprise Applications group. Mobile BI Solution

Increasing the utilization of the Enterprise Data Warehouse through the growth of mobile and Web integration and cleansing and enriching a number of the key information stores (Product, Customer, Vendors), including the enrichment of data from third-party sources remains a key priority to improve our information delivery. This will help us exploit the visual analysis capabilities provided with MicroStrategy, taking our data-based decision making to the next level of execution as we Unleash our Full First Choice potential.

Electronic Commerce Innovating for Competitive Greatness The IT E-Commerce team is building a foundation of technology, partnerships, expertise and shared capabilities that can be delivered in an agile method with the vision of making it “easy to do business” with HD Supply through online and mobile tool capabilities. HD Supply chose to lead and invest in the down-market during the past several years with a focus on the

customer, driving simplification for customer satisfaction and innovation for competitive advantage. We established a brand presence for each of the business units and HDSupply.com through updated websites that communicated a consistent message and look and feel. We are well-positioned for growth as we continue to develop our online channels. In 2011, HD Supply acquired IBM WebSphere Commerce® and Message Broker® integration software to stand up a solid infrastructure platform to support our E-Commerce growth. This new sales channel enables an opportunity for differentiated growth by providing an online store where customers can shop at their convenience, 24x7x365. New E-Commerce websites for White Cap and Power Solutions are showcasing the vast range of products carried via an electronic catalog, providing detailed information of product attributes, Material Safety Data Sheets and training videos that can help train our customers on how to use products. Customers can shop these sites with prices customized to reflect purchasing agreements, and with flexibility in shipping to job sites or nearby store locations. The newly launched, www.whitecap.com, will help us grow faster than our markets and competitors. The launch of www.PowerSolutions.com will be focused on penetrating the industrial MRO market and provide extended capabilities across new and existing customers.

Collaboration for Best Performance Translation and Communication Effectiveness Effective collaboration is essential to achieving First Choice. It is a foundation for Best Performance Translation, where we unleash our full potential by rapidly translating best practices. Our team has increased our services to include: 50+ business process workflows, 30 external websites with 12 million visits per year, a single enterprise intranet visited 1.2M times per year and a single collaboration platform, SharePoint®. Our team also supports our business units when customer punch outs (business-to-business integration) are required. In 2012, we deployed the Power Solutions – Agile™ punch out solution, resulting in $2.5M of requisitioned materials from the Agile Warehouse and automation of a once manual process managed via Excel® spreadsheet.

The first enterprise collaboration platform, Support Central, was launched in 2007 to quickly support the formation of our independent company, and quickly grew into a key supporting capability for automating workflow and sharing documents. Later in 2009, two new tools were launched (Oracle Beehive and Process Maker® software) to take our document sharing and process automation to the next level. Wordpress® was deployed to support blogging, which has grown to become the enabler of the HD Supply Be Healthy campaign. Most recently, we migrated to SharePoint as our solution for enterprise collaboration. SharePoint has been fully adopted by all business units as a best-in-class collaboration platform, with 30,000 daily hits and 800 sites containing 625,000 documents.

Driving partnerships with senior living companies and in partnership with the CTI IT team, we have delivered a portal for CTI that offers a one-stop shop for our customers to schedule room turns. This portal has eliminated manual processes while seamlessly integrating the activity from inception to completion, increasing accuracy and speed of the overall room turn resulting in $3M+ in sales and expanded sales capabilities to new customers.

Enterprise communications has been on a journey to create an integrated enterprise intranet, tying each of our business intranets together to improve ease of use, associate access, information availability and communication effectiveness. In 2008, intranet content management system was launched to enable content owners to maintain their pages prior to this, all changes to the intranet required IT development and were constrained by the availability of IT resources. Our ability to make rapid content changes was unleashed. The breakthrough came in 2012, as my.hdsupply.net, a personalized enterprise intranet, was deployed and fully adopted by all business units – unleashing our full potential to communicate and distribute key information across the enterprise.

Advanced inventory transparency enables the fulfillment of customer needs across the full HD Supply inventory. The Inventory Lookup tool provides an HD Supply view of inventory across all business units, so a branch user can identify the nearest branch from which to source a product not carried in-house – a key enabler for ONE TEAM Selling. The Inventory Lookup tool has enabled incremental sales of $2.4M and 34% gross profit across three markets in 2012 alone. This year, we are launching the internal proprietary brands online catalog to standardize product and vendor mix – across Marketing and Sourcing – for 15,000+ proprietary brand products across the five core HD Supply businesses.

Mobility is not only a key megatrend in the consumer market, but a key differentiator for our company in the years to come. Smart phones flooded the consumer market in 2011. HD Supply responded by investing time and talent in developing mobile capabilities and supporting technologies. The HD Supply Location Finder mobile web application was conceived and launched, instantly becoming the most visited HD Supply Web page and our first mobile application. In early 2012, the team selected Appcelerator® as our mobile platform of choice and developed and deployed CTI FieldTrac, our first native mobile app for iOS/iPad®. We have two key priorities: 1) Unleash the full potential of the two foundational platforms - SharePoint and our Content Management Systems by expanding their deployments. 2) Strategic investment in emerging technologies like portals and mobile to improve our business capabilities and personalize the customer experience

I am very proud of what the team has been able to accomplish on our journey so far, and excited and energized about the future as we accomplish our mission of always being First Choice for our customers, suppliers, associates, investors and communities.

UNLEASHING OUR FULL POTENTIAL

Infrastructure We partner closely with all our Business Unit and Enterprise Application teams to ensure that we provide stable, scalable and costeffective compute platforms for all their mission critical applications.

Our Infrastructure team architects and delivers core compute and network services that supports our Business Units to transact quickly, flawlessly and efficiently. Our team is made up of highly qualified team members who confidently utilize cutting edge technology such as Open Source technologies and best in breed commercial products to deliver systems seamlessly to the Business.

IT is a value creation engine for HDS building competitive advantage through innovation while simplifying our customer experience, making it easy to buy from HD Supply, and differentiating HDS from our competitors. Nigel Saldanha The foundation for this VP & CTO success is having the right technology, at the right time, at the right cost. Our team works with our IT application leaders, the Open Source community and our valued vendors to design and deploy state of the art technology platforms to support our 700+ tools and applications. In 2007, when we were spun off from The Home Depot®, we had to quickly set up our own Infrastructure to support several large facilities and about 1,000 branches. We organized our team to align with key areas of responsibility: (1) Architecture, to set standards for all hardware and systems software (2) Database Management, to provide database technology and services to support the 700 systems (3) Platform Services – Servers, Storage, and Backup – to provide a world class cost effective computer platform to support the expected growth while implementing standards and operating efficiencies (4) Data Center and Network Engineering and Telecom Services, to ensure highly available connectivity and reliability (5) Desktop Engineering and Operations to establish standards and repeatability and (6) Information Security, to establish a secure operating environment for our associates, customers and suppliers. In 2012 we merged with Field Services to foster more collaboration and increase our field support by ensuring that we provided

a seamless Infrastructure and desktop end-user experience. Leveraging some of the core investments made by Hughes Supply®, the largest acquisition in our company’s history, we standardized on an MPLS network anchored by two core data centers in Orlando and San Diego, selected Hewlett Packard® (HP) for storage & servers, and started building Oracle® APEX applications for IT process automation. Very early in this process we decided that our core applications and ERP platforms would move to the Open Source Linux platform over time. This platform has given us tremendous compute power at a cost that was often a tenth of an equivalent UNIX system. Over the last five years our team has designed and implemented several state of the art tools such as Configuration Management Database (CMDB), Infrastructure Monitoring and Exception Dashboards, Request IT for online ordering of IT equipment, Project forecasting and accounting, Server and Storage deployment processes, Security dashboards and Database performance monitoring dashboards. These tools help us automate and streamline all Infrastructure activities and processes providing consistent and predictable output. In many cases our internally developed capability far exceeds anything available in the marketplace. This pursuit of excellence has enabled us to attract and retain top notch technical talent. Our top vendors often want to partner with us to build new solutions as they know we will work closely with them to build very good products. Our team was benchmarked by McKinsey and Company in 2008, validating our cost was comparable to top quartile companies similar to us in size and complexity. Looking back, we have moved through three distinct stages:

Our Formative Years (2006 – 2007) Our Integration strategy, agreed upon by our staff, was to bring the entire Infrastructure for the company under one team. That was easier said than done. We were a collection of seven different companies with very different philosophies, methodologies and technology stacks. We had to build a very strong core leadership team that would help define the path forward, all while continuing to support the business as it delivered month after month of outstanding results. By early 2007, we became an independent company and that led us down our journey to: consolidate our data centers from 23 to two (Orlando and San Diego); build one MPLS network instead of five disparate networks that barely talked to each other; integrate to one email system, one Active Directory and select one PC image. Oracle® and SQL Server® became our new database standards, Linux became our new standard for our ERP operating systems. CTI was our first business unit to migrate SAP® from an IBM® mainframe to Linux and Oracle®, achieving great performance while saving over $5M!

Consolidation (2008 – 2010) By late 2007 we saw early signs that the world economy was beginning to sputter, however no one really understood at that time just how bad it would get. We were well positioned to handle this change of events as we already had our strategy defined and we did what we do best – execute flawlessly to deliver two datacenters, one AD system, one email system and drive further consolidation throughout all areas of HDS Infrastructure operating as one team. Our last business unit was integrated in 2010. Throughout this period our team never wavered from our mission – integration and consolidation while automating and delivering state of the art capability at the best cost. We launched several key tools, including Project and Time Tracking (PaTT), CMDB, the Enterprise IT cockpit. We installed VSAT at our branches for failover connectivity, began our virtualization effort, moved to tapeless backup, implemented Internal Disaster Recovery (DR), standardized on HP for PCs and laptops, and installed SIP Trunking and Asterisk conferencing for telecom productivity. This integration effort alone would have kept most teams busy,– but there was more – a key portion of our team was also working closely with FM as they launched SAP in 2009 and continued to add new modules in the years that followed.

Enabling Growth (2011 – 2013) After executing our integration strategy, it was now time to start ramping up our capabilities in preparation for anticipated growth. We developed our long-term asset refresh strategy to ensure that our compute equipment was kept up-to-date and that it would be able to handle the increased transaction volume expected.. To prepare for this additional volume, we moved Facilities Maintenance, Power Solutions, and Canada’s HP-UX systems to the Linux Operating system, providing a 3X growth in capacity while dropping hardware costs by 75%. FM was also growing rapidly adding new modules and a second rail to deliver new capability much faster. Our databases were growing rapidly both in count and volume. We grew from 10 Oracle databases (3 TB) in 2006 to 300 databases (110 TB) in 2013. That rapid growth in data also drove a huge increase in our disk storage needs. In 2011 we moved to Hitachi as our storage vendor of choice for Tier-1 and Tier-2 storage. Our team is currently working on migrating Crown Bolt’s JD Edwards® ERP system from the IBM® iSeries to Linux and Oracle®.

UNLEASHING OUR FULL POTENTIAL

ARCHITECTURE BY DESIGN Our Architecture team works with application owners at each Business Unit and our vendors to design, size, implement and eventually help support all the application systems deployed. Our primary focus is to design scalable systems that are highly available, reliable and built with Disaster Recovery capabilities for critical Tier 1 applications.

application teams when needed. This allowed us to ensure that we were following standards for everything from operating systems to databases and helped reduce variances in our technology stack. With the CMDB and dashboard, we had good visibility of what we were running. We then developed the Infrastructure Build Tracker that gives us transparency to what is in our pipeline. All work to be performed by our Platform Services and Network teams is now tracked and reported by this tool. Our key priority going forward is to deploy agile technology platforms that can quickly scale up and down based on business need.

EXPLOSIVE DATABASE GROWTH In 2006, we only had 10 Oracle and 297 SQL Server databases, utilizing roughly 3TB of storage. As the Business deployed new solutions to drive new revenue, our database environments have grown dramatically. Our Database team now manages 110 Terabytes across 270 Oracle databases and 1,431 SQL Server databases, which is 8 times the size of the entire digitized Library of Congress! To successfully manage this growth our team standardized each deployment allowing us to grow faster while ensuring the stability of the environments. Our team has delivered on several key projects and tools that have helped the Infrastructure team to automate processes and deliver outstanding quality and value year over year. This includes tools such as the CMDB for Configuration Management, Infrastructure Dashboards for monitoring and notification, Request IT for asset requests, and PaTT for project and time tracking. Our talented development team built these tools from the ground up on the Oracle® Apex platform providing our Infrastructure team with industry leading capabilities at very low cost.

Initially, we built some basic server monitoring using Nagios which gave us an idea of what servers were up and down at any point in time. This evolved into a Configuration Management Database (CMDB), which allowed us to tie our servers back to business applications. Leveraging Open Source software like Linux and Nagios gave us the confidence to look more toward commodity servers, enabling us to build our company’s first ERP (CTI SAP) to be run on Linux. This system outperformed the HP-UX environments of the past and now 75% of our business units run their ERP’s on Linux. In 2009, we enhanced our capabilities by instituting an Infrastructure Review process wherein all projects went through a formal review where we evaluated what was needed, architected the solution, collaborated with other teams to procure and build and deliver the solution to the

In addition to supporting the tremendous growth and project execution, our team is now supporting database needs for Crown Bolt’s Red Prairie® WMS, JD Edwards® ERP, PeopleSoft® and White Cap’s Oracle® E-Business suite. Our team’s key priority is to continue our high level of execution ensuring scalability, stability and security for every database platform.

STATE OF THE ART COMPUTE PLATFORMS – CORNERSTONE OF OUR ENVIRONMENT Our Platform Services team supports Storage, Backup, Linux and Windows Engineering. We partner with our application teams, our Infrastructure team and key vendors to support the technology platforms that help HD Supply become First Choice for our customers and investors. In 2007 we moved to Linux to realize a 90% reduction in hardware costs, a 20–60% reduction in space and power needs and a 50% increase in computing capacity. We successfully migrated all ERP systems except for Mincron and Eclipse to Linux. Along this journey our storage environment has grown from 200 TB to over 1,700 TB. To simplify the management of this growth we standardized on Hitachi® for our storage hardware and introduced storage-tiering for optimization. Another incredible achievement by our Platform Engineering team was to consolidate 18 email systems to 1 allowing our company of 15k associates to easily communicate as One Team and introduced collaboration tools to allow our organization to work efficiently sharing knowledge. Automation continues to drive selfservice and productivity with the Associate Directory+ tool. Mobility Device Management (Airwatch®) will continue to enable our associates with secure connections to corporate resources. Collaboration will see improvements with instant messaging and screen sharing as we continue to support efficient and organized knowledge sharing. Our key priority going forward is to ensure operational excellence as we deploy and manage agile and scalable compute solutions.

DATACENTERS, NETWORK AND TELECOM – THE HEART OF OUR INFRASTRUCTURE Our team manages two Tier 3 Datacenters, 10,000+ miles of network connectivity and 11,000 phones across HD Supply. These facilities are designed to house and protect HD Supply’s server, storage and network infrastructure that allows our company to transact flawlessly and securely. Our data center design was achieved over the last five years by augmenting both data centers to N+1 status on power and cooling. Our network team architected a robust network with no single point of failure, together with a replication network to support in house Disaster Recovery. As we stood up our company, there was a need to expand our data center capacity; we added 1,725 sq ft. in Orlando. Over time we also augmented and enhanced the data center in San Diego to give us more stable power and cooling to support the compute workload at that data center. In 2012 additional redundancy was required and this was accomplished by adding a large generator that could handle power for the entire building. This level of redundancy was recently installed in Orlando and we will be adding the same in San Diego by June. With this added capability we can run our systems in both the Orlando GSC and the San Diego CSC with confidence even if we lose commercial power.

UNLEASHING OUR FULL POTENTIAL

Our Network team is responsible for our local area networks within our two data centers, the core network between them and the wide area network that connects all our distribution centers and branches to our data centers and the outside world. This team manages enterprise class routers, switches, firewalls and wireless equipment to provide secure and reliable transport of our business critical voice and data traffic. Early in our companyâ&#x20AC;&#x2122;s history our network consisted of 5 disparate networks and several data center facilities. In the first two years, a significant effort was put forth to simplify our environment. We reduced the number of networks and providers to one primary provider, VerizonÂŽ, resulting in better levels of service while driving down costs by 25%. This consolidation effort set the foundation for us to deliver IT infrastructure with speed and agility to support our business requirements and growth strategy. We also deployed a satellite-

based network (VSAT) to provide a redundant path back to our datacenters if we lost our primary MPLS network. This system has enabled us to transact when bad weather disrupts our terrestrial networks and on average, is used about 100 times per month to keep our branches available to serve customers.

Our Telecom Engineering team is responsible for managing the Enterprise Cisco VoIP telephone system including voicemail and contact center solutions for all Business Units, except FM. They are also responsible for the SIP Trunking infrastructure and they manage the deployment and billing of

our conventional phone lines and cell phones across the company. With the many years of experience and strong attention-to-detail, our team has saved over $600K each year - through billing audits and cellular plan optimization for the past 5 years in a row. Late in 2009 we began converting branch telephone lines from traditional telephone lines to SIP Trunking, a technology that allows all locations to share a pool of lines (SIP Ports) instead of having a large number of telephone lines at each location. This technology has enabled us to reduce telephone lines by about 90% at most branches saving the company about $2M a year. Additionally, we can now quickly add or reduce capacity to match market conditions. Our teamâ&#x20AC;&#x2122;s focus on process automation and cutting edge technology has helped us successfully operate a sizable data and telecom network at a fraction of the cost of other companies, creating a competitive advantage.

END USER COMPUTING AND BATCH OPERATIONS Our Operations team manages all the PC images, performs support for backup and recovery operations and monitors all batch jobs that are run in UC4 our Enterprise batch Scheduler. In 2006 we had no standard for PCs. We decided to consolidate our PC and laptop models to one single vendor with one standard image across all models. This has dramatically simplified our environment and helped us automate and deploy PCs in about 30 minutes versus 4 hours in the past. We also developed a self- service software portal that allows control and tracking while enabling our associateâ&#x20AC;&#x2122;s self-service ability to download and install properly licensed software. In 2008 we introduced a standard Batch Scheduler across HD Supply called UC4 which enables us to automate, schedule, run and monitor all batch jobs across FM, CTI & WhiteCap.

We monitor all batch job outputs and if anything fails, the application team is notified and takes action to ensure correction. In 2011 we worked with our Business Units to standardize on HP printers with small, medium and large printer models. This helped us consolidate our printer fleet and reduce costs by eliminating excess printers and old expired leases. We can now track how many pages are printed by each printer on a monthly basis and use that information to rightsize our printer fleet periodically.

while raising the bar and setting even higher expectations for innovation and productivity. Our focus on stability and speed, while leveraging the best solutions, is enabling our team to unleash our Full First Choice Potential!

The past seven years have been an incredible First Choice journey as we simplified our environment, integrated for cost productivity, digitized processes for speed and repeatability, and innovated for real competitive advantage. Our key priority going forward, beyond maintaining our high level of execution, is to build even stronger partnerships with our key application owners and vendors

UNLEASHING OUR FULL POTENTIAL

HD Supply Information Security is a stealth capability differentiator for our organization, building competitive advantage through effective information asset and intellectual property protection by leveraging a sophisticated multi-layered defense in depth program called S.N.I.P.E.R (Security and Network Intelligence Platform for Enterprise Risk Management). The Enterprise Information Security program delivers a simplified, secured customer experience, making HD Supply the First Choice for every customer.

Information Security

VJ Viswanathan

HD Supply’s best defense against internal and external breaches is not technology alone. It is the culture, mindset on part of every associate so that actions in support of Information Security becomes automatic and intuitive. Stay informed, be protected. 40

Chief Information Security Officer

SNIPER was built with the underlying principle of C-I-A Confidentiality: Ensuring information is disclosed to, and reviewed exclusively by intended recipients & authorized individuals. Integrity: Ensuring the accuracy and completeness of information and processing methods. Availability: Ensuring that information and associated assets are accessible to the right people, at the right time.

3 2012-2013 SNIPER – Enterprise Information Security Framework

2006 - 2007 SNIPER – GEN 1 Baseline When we were faced with a virus outbreak that shutdown 56 branches in 2007, had an unreliable email infrastructure due to spam overload and no visibility to network assets, we knew we needed to quickly develop a strategy that protected our company’s assets and our associate, customer and vendor information. Business disruption because of viruses and spam is not an option. We determined that the root-cause of this virus was due to unsecured personal devices on our company network. Since business disruption due to viruses and spam is not an option at HD Supply, we quickly

identified new vendors who would work in partnership with us to develop solutions to protect our company. First, we focused on protecting the perimeter of our house, by reducing email spam and installed Ironport® which processed over 45 million emails in 2007 and had a remarkable 85% spam block rate. By 2012, Ironport® processed 226 million emails and blocked 95% as spam. Next, we deployed Entrust® Identity guard, to allow us to connect to our systems from outside our company in a secure fashion using two-factor authentication and issued over 5k Virtual Private Network (VPN) security cards to associates needing remote access.

2007 – 2008 SNIPER – GEN 2

2009 – 2010 SNIPER – GEN 4

Core Capability Development

Operational Excellence

We evolved our framework and formalized the core Information Security policies and established a Federal Information Security Management Act (FISMA) compliance capable Cyber Incident Response plan. We completed business unit Security Risk Assessments to establish key areas to prioritize focus. Sophos® End point agents were deployed to 12k devices, resulting in increased security & performance gain. To prevent malware and virus infection while accessing Internet, Squid web proxy servers were deployed to handle 100% of our internet traffic. In partnership with our Legal team, we conceived the foundations for Data Loss Prevention (DLP) and started classifying key data types through our data classification program. We deployed SAINT, an Enterprise vulnerability scanner that is used to assess the network on a monthly basis to baseline our vulnerability posture.

With 17 well-defined service areas mapped tightly to mitigate each layer of our Infrastructure- risk, we were ready to take our operations to the next level. Applying Lean Sigma, we used Oracle® Apex as the rapid development platform to create transparency and monitoring for each service area, with established dynamic dashboards to pulse our key performance indicators (KPIs). Our Information Security Operations platform (ISOP) creates a unified entry point to 17 services that monitors over 2500 servers and 15k end points, processes 250M emails, evaluates 1.8B log events for anomalies in the network indicative of active threats and authenticates over 15k logins for Remote access VPN. ISOP continues to evolve as our unified threat management platform!

an organization to disclose breach if one was to occur since the encryption technology ensures lost data is unusable.

2011 – 2013 SNIPER – GEN 6 Service Excellence & Innovation With core security services meeting our business needs today, our team is partnering with our business units to identify our next generation of services that better serves our customers. In support of new requests such as Bring-your-own-device (BYOD) and the desire for our customers and suppliers to access our network while at our branch locations, we are installing a Network Access control (NAC) appliance due to complete in 2013.

2010 – 2011 SNIPER – GEN 5 Compliance & Service Excellence

2008 – 2009 SNIPER – GEN 3 Automate & Monitor By 2008, we had secured our perimeter and remote access capabilities, supported by a monthly vulnerability and patch management cycle. SAINT scanners generated enterprise wide vulnerability report and Infrastructure Patch deployment group would leverage this report and patch vulnerable end points and servers. We implemented over a million missing patches in our network with our new disciplined process. We also performed approximately 300 forensic investigations annually and pioneered the concept of remote forensics with a combination of open source tools and pure hacking principles. By end of 2009, we were one of the few organizations in the country that could perform remote data acquisition (for data at rest or in transit).

To provide a simplified system LOGIN experience to key HDS systems, we have worked collaboratively to build a Web Single Sign On (SSO) capability using Entrust® Get Access. When a Breach occurs that involves loss of Personally Identifiable Information (PII), Federal and State laws require breach disclosure. Such reports can cause serious reputation damage. In working with our Legal team, we keep current on data-breach disclosure laws and have identified and deployed an encryption solution that provides safe harbor coverage. Safe Harbor regulations does not require

NAC is a multi-generation project with business favorable milestones each year. This year we would be able to support a seamless guest network access similar to a coffee shop. By next year we will have a truly integrated network security capability with proactive monitoring and active connection termination controls. In addition, we are establishing a state of the art intrusion detection and prevention system that can scale detection to the cloud. We constantly optimize our operational process to drive service excellence while evaluating new technology in support of our business needs, including operating in the cloud, mobility and social networking. We not only build a world class infrastructure, but we PROTECT it with a passion. UNLEASHING OUR FULL POTENTIAL

“Teamwork is the ability to work together toward a common vision. The ability to direct individual accomplishments toward organizational objectives. It is the fuel that allows common people to attain uncommon results.” - Anonymous

Field Services

One Team. One Focus. First Choice.

Our team of 41 First Choice “go getters” - also known as our Field Services Team - has a simple mission - to be our customers’ First Choice by providing exceptional customer service and helping them make the best use of technology.

3 We solve problems and drive fast resolution to minimize the downtime 3 We provide self-service tools, including: Michele Keen Senior Director Information Technology

Enables associates to open their own Help Desk ticket for non-urgent issues Associates have self-service ability to download and install softare

The Password Reset Tool (PRT) allows associates to unlock their Windows accounts via the phone at anytime Empowers our managers to update their NT, VPN and smart-phone accounts

3W e exceed service level commitments

3 We ensure that all PC and printer assets are tracked and refreshed

3W e diligently address all Branch Life Cycle needs

3 We drive flawless project execution 3 We adhere to compliance requirements

3 We integrate talent from our Intern Program

In 2007 we supported three business units and 50 call-types! Now we support all business units with 144 different types of service calls at a 55% discount to average industry prices!

3A sset Management created repeatable processes to support data integrity providing confidence around refreshing the right asset at the right time.

3 Our PC depot process has been optimized allowing the ability to refresh 1400 assets per month utilizing IT Interns.

3 We executed on 79 Branch Life Cycle activities in 2012

3U tilizing One Team approach, Our System access and HR Administration teams process on average >500 changes a month on time and in accordance to our SOX controls.

3 In 2012, our PC support team received on average a 16% return rate on our voice of the customer surveys. Our average rating of 4.7 out of 5 and span of 1.0 is down from a span of 2.7 in 2009, demonstrating significant improvement in three years!

Over the past few years, we have focused on delivering Operational Excellence, with improvements to: PC, Executive and Deskside Support and Asset Management process automation, ensuring a consistent and exceptional experience for our customers.

Our daily pursuit of perfection is Exceptional Customer Service.

The achievements of the field services team is heavily dependent on our one team, family approach, personal pursuit of perfection and direct communication with our customers via onsite branch visits. We look forward to Unleashing Our Full First Choice Potential!

3O ur Deskside support team flawlessly manages more than 1000 tickets per month, closing 98% within established service level agreements.

3 IT Procurement rolled out of Request IT providing a one stop shop to order PCs, Printers, Phones and accessories eliminating nonvalue added steps yielding 120 hours of productivity per month.

UNLEASHING OUR FULL POTENTIAL

Wellness and Our Communities absolutely “In every case, our highest performing teams have developed a family atmosphere where they Take Care of Each Other.” – Joe DeAngelo CEO, HD Supply

“Taking Care of Each Other will result in making HD Supply the only place that we want to be. Whether it is supporting our community and taking care of ourselves so we all live longer and better, helping introduce new team members into our family, or simply celebrating our successes and raising the bar to go after the next record, I look forward to working side by side with you to build our HD Supply Family and Unleash our Full First Choice Potential.” – Joe DeAngelo, CEO, HD Supply

The HD Supply IT journey you’ve just experienced is marked by stories of teamwork, perseverance and the relentless pursuit of perfection in our climb to become the world class standard for innovation Craig Wojcik driving customer success Manager, IT and value creation. This Communications journey continues thanks to this team’s dedication to inspire and retain the talent needed to be world class. This team has demonstrated that we want to sustain what we’ve built – the best today, the best tomorrow, the best throughout the journey that is yet unwritten – in our pursuit of perfection. In only a few short years, the team has become a reflection of our culture, rooted in Service, Performance, Integrity, Respect, Innovation and Teamwork. Along the way, we have learned that commitment to perfection doesn’t stop with our business – it extends to our personal lives – to achieve a healthy lifestyle, take care of each other and support the communities in which we live and work. This is the place where we can build our best lives, build up our HD Supply family and extend a helping hand to our communities to help them grow and prosper alongside us. We have made extraordinary strides on our journey to build our best lives and take care

of each other by engaging in philanthropic activities that have real impact on those in need throughout our communities. The people who have been enriched through these efforts across the United States and Canada are too numerous to name, but the team members who have selflessly devoted time, hard work and other resources have created a remarkable cornerstone on which our Success Pyramid is built. Be Healthy has taken root as both a personal and team commitment to lay the foundation of a lifestyle that will ensure health, happiness and the ability to take care of each other for many years to come. The commitment here is one of encouragement – encouragement to receive annual screenings, achieve and maintain a healthy BMI (body mass index), eat better, exercise more and kick the tobacco habit. Thanks to an unwavering commitment from our leadership team to make our company the healthiest on the planet – to know our numbers, stay active and eliminate tobacco use - our IT team members have embraced this personal goal and we have the team support necessary to achieve it. Joe DeAngelo reminds us that Our Time is Now. This world-class IT team will continue forward – to Unleash the Full Potential worthy of our great company, great leadership, great associates, great customers and great suppliers with the indelible belief that together, no summit is out of reach.

ITâ&#x20AC;&#x2122;s commitment to achieve and sustain a healthy lifestyle is a staple of our culture. Team members have set aggressive goals and participate in a wide variety of activities to accomplish their objectives.

Be Involved represents ITâ&#x20AC;&#x2122;s commitment to be active participants in the communities in which we live and work. Our team has given generously of time, finances and other resources to help our communities Build their Best Lives, richly rewarding us for the experiences in the process.

UNLEASHING OUR FULL POTENTIAL

ÂŠ 2013 HD Supply. All Rights Reserved. This Publication Contains Proprietary and Confidential Information and Unauthorized Re-Publication, Copy or Distribution without Consent is Prohibited. INTERNAL PUBLICATION OF HD SUPPLY

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