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SEEING THE FOREST !.$ THE TREES

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$EAR &ELLOW 3HAREHOLDERS

OF PERCENT COMPARED TO PERCENT THE PREVIOUS YEAR ) AM PLEASED TO REPORT THAT IN 0# #ONNECTION )NC MADE

4HIS WAS A KEY FACTOR IN IMPROVING NET INCOME AND EARNINGS

SOLID PROGRESS IN BOTH OUR STRATEGIC BUSINESS INITIATIVES AND IN

PER SHARE

SPECIlC PROGRAMS TO BETTER SERVE OUR CUSTOMERS !T THE hFORESTv LEVEL OF BROAD BUSINESS TRENDS WE CONTINUED TO ASSESS

4HIS PROGRESS WAS PRIMARILY THE RESULT OF ONGOING INITIATIVES TO

THE )4 SOLUTIONS MARKET AND TAKE THE NECESSARY STEPS TO REMAIN

INCREASE THE PRODUCTIVITY OF OUR SALES FORCE AND IMPROVE THE

SUCCESSFUL OVER THE LONG TERM !ND AMONG THE hTREES v MANAGING

INTERNAL EFlCIENCY OF OUR BUSINESS &OR OUR CUSTOMERS WE

OUR DAY TO DAY BUSINESS OUR EMPLOYEES CONTINUED TO PROVIDE

CONTINUED TO SEEK OUT NEW OPPORTUNITIES TO PROVIDE )4 PRODUCTS

VALUABLE PRODUCT KNOWLEDGE AND SUPERIOR CUSTOMER SERVICE

AND ALSO THE MORE PROlTABLE SERVICES THAT ARE INCREASINGLY IN

EVERY DAY /UR FOCUS ON SEEING BOTH THE FOREST AND THE TREES

DEMAND )N WE CONTINUED OUR EVOLUTION INTO A COMPLETE

AND NOT MISSING ONE FOR THE OTHER HAVE CONTRIBUTED TO A SOLID

)4 SOLUTIONS PROVIDER ONE ABLE TO ACT AS A RESOURCEFUL PARTNER

RECORD OF SUCCESS IN THE PAST YEAR

TO A WIDE RANGE OF CUSTOMERS ! KEY INITIATIVE IN THIS AREA IS 3ERVICE#ONNECTION THE COLLECTIVE NAME FOR OUR GROWING

/VERALL WE RECORDED BILLION IN SALES DURING UP

COLLECTION OF PROGRAMS THAT PROVIDE VALUED ADDED SERVICES

PERCENT FROM BILLION THE PREVIOUS YEAR .ET INCOME IN

PRIMARILY TO OUR SMALL BUSINESS CUSTOMERS !CROSS OUR

WAS MILLION OR CENTS PER SHARE UP FROM

ORGANIZATION WE IMPLEMENTED NEW SYSTEMS AND PROGRAMS TO

MILLION OR CENTS PER SHARE IN 4HROUGHOUT THE YEAR

REDUCE THE DAY TO DAY COST OF DOING BUSINESS WHILE STILL

WE CONTINUED TO SERVE THE )4 SOLUTIONS MARKET THROUGH THREE

MAINTAINING HIGH STANDARDS OF CUSTOMER SERVICE

SALES SUBSIDIARIES EACH TARGETING A CORE BUSINESS SEGMENT 0# #ONNECTION 3ALES #ORPORATION SERVES )4 NEEDS OF SMALL

"EYOND THE BALANCE SHEET IN 0# #ONNECTION CONTINUED

TO MEDIUM SIZED BUSINESSES 'OV#ONNECTION )NC SUPPLIES

EFFORTS TO BE A RESPONSIBLE EMPLOYER AND MEMBER OF THE

GOVERNMENT AND EDUCATION AND -ORE$IRECT )NC SERVES LARGE

COMMUNITY %VEN IN A HIGHLY COMPETITIVE BUSINESS ENVIRONMENT

CORPORATE CUSTOMERS $URING YEAR OVER YEAR GROSS MARGIN

WE SUPPORT PROGRAMS AND ACTIVITIES THAT IMPROVE THE QUALITY OF

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.ET 4OTAL )NCOME ). 4(/53!.$

%ARNINGS 0ER 3HARE

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.ET 4OTAL )NCOME

2ISING 4OTAL 3ALES ). -),,)/.3

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! FAMILIAR SAYING REMINDS US HOW EASY IT IS TO MISS THE FOREST FOR THE TREES !T 0# #ONNECTION )NC

IT S A GOOD METAPHOR TO REMIND US ABOUT WHAT WE MUST DO AS A BUSINESS TO SUCCEED IN THE COMPETITIVE )4 SOLUTIONS MARKET 7E MUST SEE THE FORESTˆTHE BROAD TRENDS THAT SHAPE OUR INDUSTRY AND PROVIDE FUTURE OPPORTUNITIES FOR OUR COMPANY "UT WE MUST ALSO KEEP OUR EYES ON THE TREES WHICH ARE THE MANY WAYS THAT 0# #ONNECTION AND ITS

EMPLOYEES lND SUCCESS EVERY DAY ONE CUSTOMER AT A TIME 9OU CANNOT FOCUS ON ONE AND FORGET THE OTHER /UR GROWTH AND PROSPERITY DEPEND ON HAVING THE VISION AND RESOURCES TO ACHIEVE SUCCESS AT BOTH LEVELS /NE EXAMPLE OF THIS ABILITY IS THE EMERGENCE OF 3ERVICE#ONNECTION AS A KEY INITIATIVE DURING 3ERVICE#ONNECTION IS THE COLLECTIVE

SENIOR MANAGEMENT TO THE LATEST NEW SALES RECRUITS IN OUR hBOOT CAMPv TRAINING PROGRAM 4HIS COMMITMENT IS NOT A NEW THING AT 0# #ONNECTIONˆIT DATES FROM THE DAY WE OPENED OUR DOORS )T HAS ALWAYS INSPIRED US TO lND VALUE IN THRIFT

ADAPTABILITY AND A WILLINGNESS TO DO WHATEVER IT TAKES TO SATISFY OUR CUSTOMERS 4ODAY THIS SPIRIT THRIVES AS OUR EMPLOYEES lLL THOUSANDS OF ORDERS EACH DAY FOR OVERNIGHT DELIVERY OF CRUCIAL TECHNOLOGY COMPONENTS TO CUSTOMERS IN ALL PARTS OF THE NATION

)N TERMS OF OVERALL CORPORATE DIRECTION OUR SUCCESS IS ALSO THE RESULT OF KEEPING BOTH THE FOREST AND THE TREES WITHIN OUR VISION )F WE CONTINUE TO MAINTAIN THIS DUAL FOCUS ) M CONlDENT THAT 0# #ONNECTION WILL CONTINUE TO BUILD ON S SOLID RECORD OF SUCCESS AND PROGRESSˆONE THAT IS ROOTED IN OUR PAST PRINCIPLES AND WHICH WE BELIEVE HAS PUT US IN A STRONG POSITION FOR FUTURE GROWTH

SEEING THE FOREST !.$ THE TREES NAME FOR 0# #ONNECTION S GROWING VALUED ADDED SERVICES AIMED AT OUR SMALL BUSINESS CUSTOMERS )T S AN EXAMPLE OF FOCUSING ON OVERALL BUSINESS TRENDS WHILE USING OUR CUSTOMER SERVICE AND FULlLLMENT SKILLS TO TAKE ADVANTAGE OF EMERGING OPPORTUNITES VE /FlCER

LIFE IN THE COMMUNITIES IN WHICH OUR EMPLOYEES LIVE )NITIATIVES IN THE PAST YEAR RANGED FROM AIDING EDUCATIONAL EFFORTS OF THE .EW (AMPSHIRE ,AKES !SSOCIATION TO UNDERWRITING A CHILDREN S CONCERT BY THE .EW (AMPSHIRE 0HILHARMONIC /RCHESTRA 3UCH ACTIVITIES ARE GOOD CORPORATE STEWARDSHIP AND ALSO GOOD BUSINESS

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FOR &UTURE 'ROWTH %VERY DAY SMALL AND MEDIUM SIZED BUSINESSES PUSH TECHNOLOGY FORWARD 7HETHER THEY RE ADOPTING EMERGING TECHNOLOGY OR

CHANGING THE WAY THEIR CUSTOMERS EXPERIENCE THE WORLD MORE BUSINESSES RELY ON 0# #ONNECTION

#UBIST 0HARMACEUTICALS 7HEN THIS BIOPHARMACEUTICAL COMPANY S EARLY ADOPTION OF TABLET 0# TECHNOLOGY REQUIRED AN EARLIER UPGRADE THAN ANTICIPATED 0# #ONNECTION HELPED #UBIST RECOVER SOME OF THE TABLETS INITIAL EXPENSE AND MINIMIZE UPGRADE COSTS

h/UR DECISION TO GO CUTTING EDGE TURNED OUT TO BE A BIT PREMATURE 0# #ONNECTION HELPED US LEVERAGE AN ASSET DISPOSAL SERVICE THAT RECOVERED HUNDREDS OF DOLLARS FOR EACH TABLET WE GOT RID OF 7E WERE ABLE TO APPLY THAT CREDIT TOWARD THE PURCHASE OF NEW TABLETS AND IT OFFSET A HUGE CHUNK OF THE COST 7ITHOUT THE ASSET DISPOSAL SERVICE SOME PEOPLE IN OUR )4 ORGANIZATION WOULD PROBABLY BE LOOKING FOR NEW JOBS v ˆ!NTHONY -URABITO 6ICE 0RESIDENT OF )NFORMATION 4ECHNOLOGY

#UBIST 0HARMACEUTICALS )NC

7URLD-EDIA #HANGING THE WAY THE WORLD BUYS AND SHARES DIGITAL MEDIA REQUIRES A LEADING EDGE TECHNOLOGY PARTNER 4HAT S EXACTLY WHAT 7URLD-EDIA FOUND IN 0# #ONNECTION

h"UILDING THE INFRASTRUCTURE TO SUPPORT A NEW KIND OF PEER TO PEER MUSIC SHARING SERVICE WAS A MAJOR UNDERTAKING 0# #ONNECTION WORKED WITH US EVERY STEP OF THE WAY HELPING US DESIGN AND IMPLEMENT THE MASSIVE STORAGE ARCHITECTURE NECESSARY TO BRING THE WORLD ITS MUSIC AND PAVE THE WAY FOR FUTURE GROWTH ˆ *OE (ATCH %XECUTIVE 60 OF "USINESS $EVELOPMENT 7URLD-EDIA

4HE )NTEC 'ROUP ,OOKING TO LOWER LONG DISTANCE CHARGES BY ADOPTING 6OICE OVER )0 )NTERNET TELEPHONY

BUT RELUCTANT TO INVEST HEAVILY IN lRST GENERATION TECHNOLOGY 4HE )NTEC 'ROUP FOUND THE PERFECT lT WITH )0 #ONNECTION© A LOW COST 6O)0 SOLUTION FROM 0# #ONNECTION

h!S A MID SIZED BUSINESS WE OFTEN CAN T BE AN EARLY ADOPTER OF NEW TECHNOLOGY BECAUSE IT S COST PROHIBITIVE )0 #ONNECTION PHONES AND SERVICE FROM 0# #ONNECTION ENABLED US TO TRY )NTERNET CALLING WITHOUT OVERSTRETCHING OUR BUDGET !S A RESULT WE ARE SEEING SIGNIlCANT SAVINGS ON MONTHLY PHONE EXPENSES AND ENJOYING THIS CHANCE TO BE ON THE CUTTING EDGE v ˆ *OHN -ARTIN -ATERIALS AND )4 $IRECTOR 4HE )NTEC 'ROUP )NC

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0# #ONNECTION )NC #ORPORATE (EADQUARTERS -ILFORD 2OAD -ERRIMACK .(

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