CDW 2003 Annual Report Download - page 64

51
In July 2003, our Board of Directors authorized a new share repurchase program of up to 2,500,000 shares
of our common stock. These purchases may be made from time to time in both open market and private
transactions, as conditions warrant. This new repurchase program is expected to remain in effect through
July 2005, unless earlier terminated by the Board or completed. During the year ended December 31, 2003,
no purchases were made under this new program.
Repurchased shares are held in treasury pending use for general corporate purposes, including issuances
under various employee stock plans.
19. Public Offering of Common Shares
In August 2001, Michael P. Krasny, the chairman emeritus, principal shareholder and a director of the
Company; Gregory C. Zeman, then vice chairman and a director of the Company; and Daniel B. Kass, then
an executive vice president and a director of the Company, sold a total of 10,562,500 shares of common
stock through a secondary public offering at a price of $40.00 per share. We did not receive any proceeds
from the sale of their shares and the number of outstanding common shares was not impacted. The shares
sold by Mr. Zeman and Mr. Kass were acquired from Mr. Krasny through the exercise of options previously
granted to them pursuant to the MPK Stock Option Plan. The sale of shares by Mr. Zeman and Mr. Kass
resulted in the realization by the Company in the year ended December 31, 2001 of an income tax benefit of
approximately $43.5 million, of which approximately $0.6 million was previously recorded to deferred
taxes. The incremental tax benefit of $42.9 million was recorded as an increase to paid-in capital.
Additionally, we recorded incremental payroll tax expense related to the option exercise of approximately
$1.6 million, which reduced diluted earnings per share by approximately $0.01 per share.
In March 2002, Mr. Zeman sold a total of 2,000,000 shares of common stock at a price of $48.00 per share.
We did not receive any proceeds from the sale of shares and the number of outstanding common shares was
not impacted. The shares sold by Mr. Zeman were acquired from Mr. Krasny through the exercise of
options previously granted to Mr. Zeman pursuant to the MPK Stock Option Plan. The exercise of options
by Mr. Zeman resulted in the realization by the Company of an income tax benefit of approximately $37.9
million in the first quarter of 2002, of which approximately $0.4 million had been previously recorded to
deferred taxes. We recorded the incremental tax benefit of $37.5 million as an increase to paid-in capital.
In addition, we recorded incremental payroll tax expense related to the option exercise of approximately
$1.4 million, which reduced diluted earnings per share by approximately $0.01 per share.
In May 2003, Mr. Zeman and Mr. Kass sold a total of 1,108,864 shares of common stock. We did not
receive any proceeds from the sale of shares and the number of outstanding common shares was not
impacted. The shares sold by Mr. Zeman and Mr. Kass were acquired from Mr. Krasny through the
exercise of options previously granted to them pursuant to the MPK Stock Option Plan. The exercise of
options by Mr. Zeman and Mr. Kass resulted in the realization by the Company of an income tax benefit of
approximately $17.7 million in the second quarter of 2003, of which approximately $0.3 million had been
previously recorded to deferred taxes. We recorded the incremental tax benefit of $17.4 million as an
increase to paid-in capital. In addition, we recorded incremental payroll tax expense related to the option
exercise of approximately $0.7 million, which reduced diluted earnings per share by less than $0.01 per
share.