Wayside Technology Group

Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
For the fiscal year ended December 31, 2021
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
For the transition period from                              to
Commission file number: 000-26408
WAYSIDE TECHNOLOGY GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware
13-3136104
(State or other jurisdiction of incorporation)
(IRS Employer Identification Number)
4 Industrial Way West, Suite 300  Eatontown, NJ
07724
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (732) 389-0932
Securities registered pursuant to section 12(b) of the Act:
Title of Each Class
Trading Symbol
Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share
WSTG
The NASDAQ Global Market
Securities registered pursuant to section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  ◻  No ⌧
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act Yes ◻  No  ⌧
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ⌧  No  ◻
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ⌧  No  ◻
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ◻
Accelerated filer ⌧
Non-accelerated filer ◻
Smaller reporting company ⌧
Emerging growth company ◻
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ◻
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under
Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ⌧
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes  ☐  No  ⌧
The aggregate market value of the Common Stock held by non-affiliates of the Registrant computed by reference to the closing sale price for the Registrant’s Common Stock as of June 30,
2021, which was the last business day of the Registrant’s most recently completed second fiscal quarter, as reported on The NASDAQ Global Market, was approximately $100.3 million (In
determining the market value of the Common Stock held by any non-affiliates, shares of Common Stock of the Registrant beneficially owned by directors, officers and holders of more than
10% of the outstanding shares of Common Stock of the Registrant have been excluded. This determination of affiliate status is not necessarily a conclusive determination for other purposes).
The number of shares outstanding of the Registrant’s Common Stock as of March 1, 2022 was 4,450,062 shares.
Documents Incorporated by Reference: Portions of the Registrant’s definitive Proxy Statement for its 2022 Annual Meeting of Stockholders to be filed on or before May 2, 2022 are
incorporated by reference into Part III of this Report.

Table of Contents
PART I
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report includes “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), and Section 27A of the Securities Act of 1933, as amended (the “Securities Act”). All statements, other
than statements of historical or current fact, in this report are forward-looking statements, including but not limited to statements regarding 
the scope and duration of the novel coronavirus pandemic (“COVID-19”) and its impact on our business, future events or conditions, 
industry prospects and the Company’s expected financial position, business and financing plans.  These forward-looking statements may be
accompanied by such words as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,”
“target,” “should,” “likely,” “will” and other words and terms of similar meaning.
Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to have been correct. These forward-looking statements are subject to certain known and
unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these
forward-looking statements. We strongly urge current and prospective investors to carefully consider the cautionary statements and risks
contained in this report, particularly the risks described under “Item 1A. Risk Factors” herein. Such risks include, but are not limited to, the
continued acceptance of the Company’s distribution channel by vendors and customers, the timely availability and acceptance of new
products, contribution of key vendor relationships and support programs, as well as factors that affect the software industry generally.
The Company operates in a rapidly changing business, and new risk factors emerge from time to time. Management cannot predict
every risk factor, nor can it assess the impact, if any, of all such risk factors on the Company’s business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those projected in any forward-looking statements.
Accordingly, forward-looking statements should not be relied upon as a prediction of actual results and readers are cautioned not
to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
The statements concerning future sales, future gross profit margin and future selling and administrative expenses are forward
looking statements involving certain risks and uncertainties such as availability of products, product mix, pricing pressures, market
conditions and other factors, which could result in a fluctuation of sales below recent experience.

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Item 1. Business
General
Wayside Technology Group, Inc., a Delaware corporation, and its subsidiaries (the “Company,” “us,” “we,” or “our”) is a value
added information technology (“IT”) distribution and solutions company. The Company primarily operates through its “Distribution”
segment, which distributes emerging technologies to corporate resellers, value added resellers (VARs), consultants and systems integrators
worldwide under the name “Climb Channel Solutions”. The Company also operates a smaller segment called “Solutions”, which is a cloud
solutions provider and value-added reseller of software, hardware and services for customers worldwide under the names “TechXtend” and
“Grey Matter”. Across both segments, we offer an extensive line of products from leading software vendors and tools for
virtualization/cloud computing, security, networking, storage and infrastructure management, application lifecycle management and other
technically sophisticated domains as well as computer hardware.
The Company was incorporated in Delaware in 1982. Our common stock, par value $0.01 per share (“Common Stock”) is listed
on The NASDAQ Global Market under the symbol “WSTG”. Our main web site address is www.waysidetechnology.com, and the other
web sites maintained by our business include www.climbcs.com, www.techxtend.com, and www.greymatter.com. The information
contained on, or otherwise accessible through, our websites is not part of, or incorporated by reference into, this report.
In our Distribution segment, which accounted for approximately 92% of our consolidated net sales and 80% of our consolidated
gross profit during the year ended December 31, 2021, we distribute technology products from software developers, software vendors or
original equipment manufacturers (OEMs) to resellers, and system integrators worldwide. We purchase software, maintenance/service
agreements, networking/storage/security equipment and complementary products from our vendors and sell them to our reseller customers.
The large majority of products we sell are “drop shipped” directly to the customers, which reduces physical handling by the Company and
required investment in inventory. Generally, a vendor authorizes a limited number of companies to act as distributors of their product and
sell to resellers of their product. Our reseller customers include value-added resellers, or VARs, corporate resellers, government resellers,
system integrators, direct marketers, and national IT superstores. We combine our core strengths in customer service, marketing,
distribution, credit and billing to allow our customers to achieve greater efficiencies in time to market in the IT channel in a cost-effective
manner.
While our Distribution business is characterized by low gross profit as a percentage of adjusted gross billings, or gross margin,
and price competition, we have been able to operate profitably by leveraging an efficient and scalable business model with low capital
investment requirements. The large majority of the products we sell are either digital products such as license authorizations, third party
maintenance contracts, or hardware that is dropped shipped to the end customer directly by the vendor. We utilize electronic digital
interchange (“EDI”) and other automation to fulfill these orders on a cost-efficient basis. We also maintain relatively low inventory
balances relative to our gross billings and enjoy what we believe is favorable credit from our vendor partners, allowing us to deploy a
capital efficient model as reflected by our return on equity and pre-tax income as a percentage of gross profit generated.
In our Distribution segment, we are highly dependent on the end-market demand for the products we sell, and on our partners’
strategic initiatives and business models. This end-market demand is influenced by many factors including the introduction of new products,
replacement and renewal cycles for existing products, competitive products, overall economic growth and general business activity. A
difficult and challenging economic environment may also lead to consolidation or decline in the industry and increased price-based
competition. We continually review the marketplace to identify new and emerging vendors and products to potentially add to our vendor
partners.  
We also provide comprehensive IT solutions directly to end users through our Solutions segment, which accounted for
approximately 8% of our consolidated net sales and 20% of our consolidated gross profit during the year ended December 31, 2021.
Products in this segment are acquired directly from original equipment manufacturers (OEMs),

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software developers or distributors and sold to end users. We provide customer service, billing, sales and marketing support in this segment
and provide extended payment terms to facilitate sales.
The Company operates a distribution facility in Eatontown, New Jersey.
Acquisitions
We view acquisitions as an important part of our strategic growth plan. In 2020, we completed two acquisitions to add scale, broaden our
geographic footprint, expand partner relationships and add cloud support capabilities.
●
Interwork Technologies Inc. (“Interwork”) acquired on April 30, 2020, is a technology distributor specializing in cyber security
products based in Toronto, Canada. The acquisition added scale to our existing Canadian operation and brought key vendor partner
relationships to our portfolio.
●
CDF Group Limited (“CDF”) acquired on November 6, 2020, is a technology distributor and solutions provider with a specialty in
cloud enablement and support services. The acquisition expanded our sales presence in the United Kingdom and Europe, added a
key vendor partner relationship for Microsoft cloud products, and provided valuable technical expertise in cloud enablement and
support.
We plan to continue to evaluate acquisition opportunities as part of our strategic growth plan going forward.
Products
An essential part of our ongoing operations and strategic growth plan in our Distribution segment is the continued recruitment of
software vendors for which we become authorized distributors of their products. Through our Distribution segment, we sell a wide variety
of technology products from a broad range of software vendors and manufacturers, such as Bluebeam Software, Flexera Software, Intel
Software, Microsoft, Micro Focus, Mindjet, SmartBear Software, SolarWinds, Sophos, StorageCraft Technology, TechSmith, Trend Micro,
Unitrends, CloudGenix, Tintri and Extrahop. On a continuous basis, we screen new vendors and products for inclusion in our line card
based on their features, quality, price, profit margins and current market trends. Developing a diverse vendor base is a key element of our
business strategy. We focus on establishing deep relationships with our vendor and reseller partners by providing specialized product
training to our sales force and the use of dedicated sales teams. We have also established an efficient ordering process with our key partners
through the implementation of electronic ordering and other processes adapted to their requirements. As a result, our relationships with our
key vendor partners tend to be long-term in nature despite the absence of long-term contracts, with a significant portion of sales derived
from annually recurring renewals of software maintenance and subscription agreements related to our partners embedded base of customers
utilizing their software products. Additionally, a key part of our strategic growth plan is to provide a high level of support to select emerging
technology vendors through our Climb Elevate program to develop future relationships throughout the growth cycle of a vendor partner.
In our Solutions business, an essential part of our strategic growth plan is to pursue opportunities with higher growth prospects and
gross margin characteristics through the sale of specialty products, services and cloud offerings. Through the acquisition of CDF we added
certain technical and administrative support capabilities to enable us to resell cloud and software as a service products (“SaaS”) including
Microsoft products in the United Kingdom. Our strategic growth plan is to expand our cloud offerings by leveraging these support services
to other markets and products.
For the year ended December 31, 2021, Sophos and SolarWinds accounted for 20% and 10%, respectively of our consolidated
purchases. For the year ended December 31, 2020, Sophos and SolarWinds accounted for 20% and 12%, respectively of our consolidated
purchases. The loss of a key vendor or group of vendors could disrupt our product availability and otherwise have an adverse effect on the
Company.
The Company predominantly sells third party software, software subscriptions, and maintenance. Sales of hardware and
peripherals represented 5% and 9% of our adjusted gross billings in 2021 and 2020, respectively.

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Cloud
Our vendor and reseller partners are increasingly incorporating cloud and hybrid cloud products into their portfolios. An essential
part of our strategic growth plan is to provide value added services to our vendor partners and customers to enhance their ability to market
these products. This includes maintaining infrastructure to facilitate licensing of cloud and SaaS products, providing technical support for
cloud products, and providing integration and enablement services. The acquisition of CDF provided us with the ability to provide support
for these cloud services in the United Kingdom and Europe. We plan to continue to leverage these capabilities to provide cloud support
services throughout our worldwide operations.
Marketing and Distribution
We market products through creative marketing communications, including our web sites, local and on-line seminars, events,
webinars, and social media. We also use direct e-mail and printed material to introduce new products and upgrades, to cross-sell products to
current customers, and to educate and inform existing and potential customers. We believe that our blend of electronic and traditional
marketing and selling programs are important marketing vehicles for software vendors and manufacturers. These programs provide a cost-
effective and service-oriented means to market and sell and fulfill software products and meet the needs of users.
We sell products to large, multi-national broad line resellers, sometimes referred to as direct market resellers (DMRs), as well as
thousands of value added resellers (VARs ), which tend to be smaller and focus on value added services to their customers. As part of our
strategic growth plan, we expect to continue diversifying our customer base by offering compelling products to the VAR community as we
develop our vendor partner lineup. As a result, a higher proportion of our sales in 2021 were from VARs, driven by a focus on increasing
sales to larger VARs with more than $1 million in annual sales. The Company had two customers that each accounted for more than 10% of
total consolidated net sales for 2021. For the year ended December 31, 2021, CDW Corporation (NASDAQ: CDW) (“CDW”) and Software
House International Corporation (“SHI”), both of whom are considered DMRs, accounted for 18%, and 17%, respectively, of consolidated
net sales and as of December 31, 2021, 18% and 22%, respectively, of total net accounts receivable. For the year ended December 31,
2020, CDW Corporation (NASDAQ: CDW) (“CDW”) and Software House International Corporation (“SHI”), accounted for 24%, and
14%, respectively, of consolidated net sales and as of December 31, 2020, 19% and 9%, respectively, of total net accounts receivable. Our
top five customers accounted for 51% and 52% of consolidated net sales in 2021 and 2020, respectively.
Net sales to customers in Canada represented 9% and 7% of our consolidated net sales in 2021 and 2020, respectively. Net sales in
Europe and the rest of the world represented 13% and 5% of our consolidated net sales in 2021 and 2020, respectively. For geographic
financial information, please refer to Note 13 in the Notes to our Consolidated Financial Statements.
Customer Support
We believe that providing a high level of customer service is necessary to compete effectively and is essential to continued sales
and revenue growth. Our account representatives assist our customers with all aspects of purchasing decisions, order processing, returns
processing, and inquiries on order status, product pricing and availability. The account representatives are trained to answer all basic
questions about the features and functionality of products.
Purchasing and Fulfillment
The Company’s success is dependent, in part, upon the ability of its vendor partners to develop and market products that meet the
changing requirements of the marketplace. The Company believes it maintains good relationships with its vendors. The Company and its
principal vendors have cooperated frequently in product introductions and in other marketing programs. As is customary in the industry, the
Company has no long-term supply contracts with any of its vendor partners, and substantially all the Company’s contracts with its vendors
are terminable upon 30 days’ notice or less, however, it is notable that the tenure of our relationships with vendor partners tends to extend
over a longer term. We

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attribute this to the deep relationships we establish with our partners involving sales support, product and customer knowledge, and tailored
infrastructure to facilitate efficient order processing.
Most vendor partners or distributors will “drop ship” products directly to the customers, which reduces physical handling by the
Company. Inventory management techniques, such as “drop shipping” allow the Company to offer a greater range of products without
increased inventory requirements or cost of carrying inventory.
Inventory levels may vary from period to period, due in part to increases or decreases in sales levels, the Company’s practice of
making advance purchases when it deems the terms of such purchases to be attractive, and the addition of new vendor partners and products.
From time to time, we may make advance payments to vendors to apply against future purchases from the vendor. Moreover, the
Company’s order fulfillment and inventory control systems allow the Company to order certain products in time for next day shipping. The
Company promotes the use of EDI with its vendor partners and customers, which helps reduce overhead and the use of paper in the
ordering process.
Competition
The market for the technology products we sell is characterized by rapid changes in technology, user requirements, and
competitive pricing. The way software products are distributed and sold is constantly changing, and new methods of distribution and sale
may emerge or expand, including direct sales by technology providers to end users, and the introduction of cloud versions of their products.
As an IT channel solutions provider, a critical element of our strategic growth plan is to maintain our ability to offer an efficient route to
market for emerging technology vendors. Additionally, a key element of our strategic growth plan is to capitalize on market changes by
implementing new value added services such as cloud support and integration offerings.
In our Distribution segment, we compete with other distributors to become an authorized distributor of products from software
developers and vendors. The Company competes to gain distribution rights for new products primarily based on its reputation for
successfully bringing new products to market and the strength of and quality of its relationships with software vendors and the reseller
community. We also compete against other distributors to gain market share among authorized resellers for products we are authorized to
distribute based on price, and level of service. We compete against much larger broad-line distributors with more resources than we have,
including Arrow Electronics Inc. (NYSE: ARW), Synnex Corporation (NYSE: SNX), Tech Data Corporation and Ingram, as well as
specialty distributors. We believe we offer a compelling solution for emerging technology vendors seeking to establish the IT channel as a
route to market, by offering broad distribution capabilities with more flexibility than some of our larger competitors.  In our Solutions
segment, we compete against a large variety of IT solutions providers including e- commerce sites, service organizations, value added
resellers, cloud solution providers and technology providers offering direct solutions. We believe that our ability to offer software
developers and IT professionals easy access to a wide selection of desired IT products at reasonable prices with prompt delivery and high
customer service levels, along with our good relationships with vendor partners, allows us to compete effectively.
Information Technology
The Company operates IT systems on several platforms including Windows and cloud-based platforms that control the full order
processing cycle. These IT systems allow for centralized management of key functions, including inventory, accounts receivable,
purchasing, sales and distribution and payment processing. We are dependent on the accuracy and proper utilization of our technology
systems, telephone systems, websites, e-mail and EDI systems.
Our IT systems allow us to monitor sales trends, real-time product availability, order status throughout the full order cycle, and
automates order transactions and invoicing transactions for our customers and vendors. The main focus of our IT systems is to allow us to
transact and communicate with our customers and vendors in the most efficient manner possible. We provide various options to transact
electronically with our customers and vendors through EDI, XML and other electronic methods.

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The Company recognizes the need to continually upgrade its IT systems to effectively manage and secure its infrastructure and
customer data and to provide continued scalability and flexibility. In that regard, the Company anticipates that it will, from time to time,
require software and hardware upgrades for its present IT systems.
Trademarks
The Company conducts its business under various trademarks and service marks including Climb Channel Solutions, TechXtend,
Grey Matter and International Software Partners. The Company protects these trademarks and service marks and believes that they have
significant value to us and are important factors in our marketing programs.
Employees
As of December 31, 2021, Wayside Technology Group, Inc. and its subsidiaries had 269 total employees, including 268 full-time
employees. The Company is not a party to any collective bargaining agreements with its employees, has experienced no work
stoppages and considers its relationships with its employees to be satisfactory.
Available Information
Under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company is required to file annual, quarterly
and current reports, proxy and information statements and other information with the Securities and Exchange Commission (“SEC”). The
SEC maintains a web site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC, including us. The Company also makes available, free of charge, through its internet web site at
http://www.waysidetechnology.com, its reports on Forms 10-K, 10-Q and 8-K, and amendments to those reports, as soon as reasonably
practicable after they are filed with the SEC. The Company will provide paper copies of its reports on Form 8-K free of charge as requested.
The information contained on, or otherwise accessible through, our website is not part of, or incorporated by reference into, this annual
report.
The Company has a Code of Ethics and Business Conduct that applies to all employees, officers and directors of the Company,
including our Chief Executive Officer and Chief Financial Officer. We review the Code of Ethics and Business Conduct annually and
consider updates as necessary. The full text of the Code of Ethics and Business Conduct, is available at our web site,
http://www.waysidetechnology.com. We intend to disclose any amendment to, or waiver from, a provision of the Code of Ethical Conduct
that applies to its Chief Executive Officer or Chief Financial Officer on our web site.

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Item 1A. Risk Factors
Investors should carefully consider the risk factors set forth below as well as the other information contained in this report. Any of
the following risks could materially and adversely affect our business, financial condition or results of operations. Additional risks and
uncertainties not currently known to us or those currently viewed by us to be immaterial may also materially and adversely affect our
business, financial condition or results of operations.
Risks Related to our Business
We serve customers and have locations throughout the world and are subject to terrorist attacks, acts of war, natural disasters,
global pandemic and other similar risks, including without limitation, COVID-19, which could materially adversely affect our business,
financial condition, and results of operations. Terrorist attacks, acts of war, natural disasters, global pandemics or other disasters or public
health concerns in regions of the world where we have operations could result in the disruption of our business. Such acts, including
Russia’s February 2022 invasion of Ukraine, have created, and continue to create, economic and political uncertainties and have contributed
to global economic instability. Specifically, these acts, pandemics, disasters and health concerns can result in increased travel restrictions
and extended shutdowns of certain businesses in the region, as well as social, economic, or labor instability. Disruptions in affected regions
over a prolonged period could have a material adverse impact on our business and our financial results.
The COVID-19 pandemic has created significant volatility, uncertainty and economic disruption, which may adversely affect our
business, financial condition, liquidity or results of operations. While we offer a full suite of solutions and services that address customer
priorities across the technology landscape, it is not possible for us to predict the duration or magnitude of adverse results of the outbreak
and its effects on our business, liquidity or results of operations at this time. As a result, many of the estimates and assumptions used in
preparation of our financial statements required increased judgment and carry a higher degree of variability and volatility. As events
continue to evolve with respect to the pandemic, these estimates may materially change in future periods.
Changes in the information technology industry and/or economic environment may reduce demand for the products and
services we sell. Our results of operations are influenced by a variety of factors, including the condition of the IT industry, general economic
conditions, shifts in demand for, or availability of, computer products and software and IT services and industry introductions of new
products, upgrades or methods of distribution. The information technology products industry is characterized by abrupt changes in
technology, rapid changes in customer preferences, short product life cycles and evolving industry standards. Net sales can be dependent on
demand for specific product categories, and any change in demand for or supply of such products could have a material adverse effect on
our net sales, and/or cause us to record write-downs of obsolete inventory, if we fail to react in a timely manner to such changes.
We rely on our vendor partners for product availability, marketing funds, purchasing incentives and competitive products to
sell. We acquire products for resale both directly from manufacturers and indirectly from distributors. The loss of a vendor partner could
cause a disruption in the availability of products. Additionally, there is no assurance that as manufacturers continue to or increasingly sell
directly to end users and through the distribution channel, that they will not limit or curtail the availability of their products to
distributors/resellers like us. For example, resellers and software vendors may attempt to increase the volume of software products
distributed electronically through ESD (Electronic Software Distribution) technology, through subscription services, and through on-line
shopping services, and correspondingly, decrease the volume of products sold through us. Our inability to obtain a sufficient quantity of
products, or an allocation of products from a manufacturer in a way that favors one of our competitors, or competing distribution channels,
relative to us, could cause us to be unable to fill clients’ orders in a timely manner, or at all, which could have a material adverse effect on
our business, results of operations and financial condition. We also rely on our vendor partners to provide funds for us to market their
products, including through our on-line marketing efforts, and to provide purchasing incentives to us. If any of the vendor partners that have
historically provided these benefits to us decides to reduce such benefits, our expenses would increase, adversely affecting our results of
operations.
General economic weakness may reduce our revenues and profits. Generally, economic downturns, may cause some of our
current and potential customers to delay or reduce technology purchases, resulting in longer sales cycles, slower adoption of new
technologies and increased price competition. We may, therefore, experience a greater decline in

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demand for the products we sell, resulting in increased competition and pressure to reduce the cost of operations. Any benefits from cost
reductions may take longer to realize and may not fully mitigate the impact of the reduced demand. In addition, weak financial and credit
markets heighten the risk of customer bankruptcies and create a corresponding delay in collecting receivables from those customers and
may also affect our vendors’ ability to supply products, which could disrupt our operations. The realization of any or all these risks could
have a material adverse effect on our business, results of operations and financial condition.
The IT products and services industry is intensely competitive and actions of competitors, including manufacturers of products
we sell, can negatively affect our business. Competition has been based primarily on price, product availability, speed of delivery, credit 
availability and quality and breadth of product lines and, increasingly, also is based on the ability to tailor specific solutions to client needs. 
We compete with manufacturers, including manufacturers of products we sell, as well as a large number and wide variety of marketers and 
resellers of IT products and services. In addition, manufacturers are increasing the volume of software products they distribute 
electronically directly to end-users and in the future, will likely pay lower referral fees for sales of certain software licensing agreements 
sold by us.  Generally, pricing is very aggressive in the industry, and we expect pricing pressures to continue. There can be no assurance 
that we will be able to negotiate prices as favorable as those negotiated by our competitors or that we will be able to offset the effects of 
price reductions with an increase in the number of clients, higher net sales, cost reductions, or greater sales of services, which service sales 
typically are delivered at higher gross margins, or otherwise. Price reductions by our competitors that we either cannot or choose not to 
match could result in an erosion of our market share and/or reduced sales or, to the extent we match such reductions, could result in reduced 
operating margins, any of which could have a material adverse effect on our business, results of operations and financial condition.
The way software products are distributed and sold is changing, and new methods of distribution and sale may emerge or
expand. Software vendors have sold, and may intensify their efforts to sell, their products directly to end-users. There can be no assurances
that software developers and vendors will continue using distributors and resellers to the same extent they currently do. Future efforts by
software developers and vendors to bypass third-party sales channels could materially and adversely affect the Company’s business, results
of operations and financial condition. In addition, resellers and software vendors may attempt to increase the volume of software products
distributed electronically through ESD (Electronic Software Distribution) technology, through subscription services, and through on-line
shopping services. Any of these competitive programs, if successful, could have a material adverse effect on the Company’s business,
results of operations and financial condition. The Company’s business and results of operations may be adversely affected if the terms and
conditions of the Company’s authorizations with its vendors were to be significantly modified or if certain products become unavailable to
the Company.
We offer credit to our customers and, therefore, are subject to significant credit risk. We sell our products to a large and diverse
customer base. We finance a significant portion of such sales through trade credit, typically by providing 30-60-day payment terms. In
addition, we offer extended payment terms to certain customers for terms of up to 2 years. As a result, our business could be adversely
affected in the event of a deterioration of the financial condition of our customers, resulting in the customers’ inability to repay us. This risk
may increase if there is a general economic downturn affecting a large number of our customers and in the event our customers do not
adequately manage their business or properly disclose their financial condition. Also, certain of our larger customers require greater than
30-day payment terms which could increase our credit risk and decrease our operating cash flow. 
We face substantial competition from other companies. We compete in all areas of our business against local, regional, national,
and international firms. Some of our current competitors have substantially greater capital resources and sales and distribution capabilities
than we do. In response to competitive pressures from any of our current or future competitors, we may be required to lower selling prices
in order to maintain or increase market share, and such measures could adversely affect our operating results. In addition, we face
competition from vendors, which may choose to market their products directly to end-users, rather than through channel partners such as
the Company, and this could adversely affect our future sales. Many competitors compete based principally on price and may have lower
costs or accept lower selling prices than we do and, therefore, our gross margins may not be maintainable. Our gross margins have declined
historically and may continue to decline in the future. Our competitors may offer better or different products and services

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than we offer. In addition, we do not have guaranteed purchasing volume commitments from our customers and, therefore, our sales volume
may be volatile.
Our business is substantially dependent on a limited number of customers and vendors, and the loss or any change in the
business habits of such key customers or vendors may have a material adverse effect on our financial position and results of operations.
Because our standing arrangements and agreements with our customers and vendors typically contain no purchase or sale obligations and
are terminable by either party upon several months or otherwise relatively short notice, we are subject to significant risks associated with
the loss or change at any time in the business habits and financial condition of key customers or vendors. We have experienced the loss and
changes in the business habits of key customer and vendor relationships in the past and expect to do so again in the future.
 
Sales of products purchased from our largest two vendors accounted for 30% of our 2021 purchases and sales from our largest five
vendors generated approximately 46% of 2021 purchases. As is the case with many of our vendor and customer relationships, our
contractual arrangements with these large vendors are terminable by either party upon several months’ notice. If these contracts or our
relationships with these vendors terminate for any reason, or if any of our other significant vendor relationships terminate for any reason,
and we are not able to sell or procure a sufficient supply of those products from alternative sources, or at all, our financial position and
results of operations would be adversely affected. Our vendors are subject to many if not all of the same (or similar) risks and uncertainties
to which we are subject, as well as other risks and uncertainties, and we compete with others for their business. Accordingly, we are at a
continual risk of loss of their business on account of a number of factors and forces, many of which are largely beyond our control.
 
In 2021, our two largest customers accounted for 35% of our net sales and our largest five customers accounted for 51% of our net
sales. If any of our significant customer relationships terminate for any reason, and we are not able to replace those customers and
associated revenues, our financial position and results of operations would be adversely affected.
Disruptions in our information technology and voice and data networks could affect our ability to service our clients and cause
us to incur additional expenses. We believe that our success to date has been, and future results of operations likely will be, dependent in
large part upon our ability to provide prompt and efficient service to clients. Our ability to provide such services is dependent largely on the
accuracy, quality and utilization of the information generated by our IT systems, which affect our ability to manage our sales, client service,
distribution, inventories and accounting systems and the reliability of our voice and data networks.
Failure to adequately maintain the security of our electronic and other confidential information could materially adversely
affect our financial condition and results of operations. We are dependent upon automated information technology processes. Privacy,
security, and compliance concerns have continued to increase as technology has evolved to facilitate commerce and as cross-border
commerce increases. As part of our normal business activities, we collect and store certain confidential information, including personal
information of employees and information about partners and clients which may be entitled to protection under several regulatory regimes.
In the course of normal and customary business practice, we may share some of this information with vendors who assist us with certain
aspects of our business. Moreover, the success of our operations depends upon the secure transmission of confidential and personal data
over public networks, including the use of cashless payments. Although we did not have any material cybersecurity breaches in 2021, any
failure on the part of us or our vendors to maintain the security of data we are required to protect, including via the penetration of our
network security and the misappropriation of confidential and personal information, could result in business disruption, damage to our
reputation, financial obligations to third parties, fines, penalties, regulatory proceedings and private litigation with potentially large costs,
and also result in deterioration in our employees’, partners’ and clients’ confidence in us and other competitive disadvantages, and thus
could have a material adverse impact on our business, financial condition and results of operations.
We depend on certain key personnel. Our future success will be largely dependent on the efforts of key management personnel for
strategic and operational guidance as well as relationships with our key vendors and customers. We also believe that our future success will
be largely dependent on our continued ability to attract and retain highly qualified management, sales, service, finance and technical
personnel. We cannot assure you that we will be able to attract and retain such personnel. Further, we make a significant investment in the
training of our sales account executives. Our

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inability to retain such personnel or to train them either rapidly enough to meet our expanding needs or in an effective manner for quickly
changing market conditions could cause a decrease in the overall quality and efficiency of our sales staff, which, in turn, could have a
material adverse effect on our business, results of operations and financial condition.
We may explore additional growth through acquisitions. During the prior year, we completed two acquisitions to add scale,
broaden our geographic footprint, expand partner relationships and add cloud support capabilities. As part of our strategic growth plan, we
may pursue the acquisition of companies that either complement or expand our existing business. As a result, we regularly evaluate
potential acquisition opportunities, which may be material in size and scope. In addition to those risks to which our business and the
acquired businesses are generally subject, the acquisition of these businesses gives rise to transactional and transitional risks, and the risk
that the anticipated benefits will not be realized.
When the Company makes acquisitions, it may take on additional liabilities or not be able to successfully integrate such
acquisitions. As part of the Company’s history and strategic growth plan, it has acquired other businesses. Acquisitions involve numerous
risks, including the following:
●
effectively combining the acquired operations, technologies, or products;
●
unanticipated costs or assumed liabilities, including those associated with regulatory actions or investigations;
●
not realizing the anticipated financial benefit from the acquired companies;
●
diversion of management’s attention;
●
negative effects on existing customer and vendor partner relationships; and
●
potential loss of key employees of the acquired companies.
Further, the Company has made, and may continue to make acquisitions of, or investments in new services, businesses or
technologies to expand its current service offerings and product lines. Some of these may involve risks that may differ from those
traditionally associated with the Company’s core distribution business, including undertaking product or service warranty responsibilities
that in its traditional core business would generally reside primarily with its vendor partners. If the Company is not successful in mitigating
or insuring against such risks, it could have a material adverse effect on the Company’s business.
Our results of operations are subject to fluctuations in foreign currency. We have several foreign subsidiaries and conduct
business in various countries and currencies. As result of these foreign operations, we have exposure to fluctuations in foreign currency
rates resulting primarily from the translation exposure associated with the preparation of our consolidated financial statements. While our
consolidated financial statements are reported in US dollars, the financial statements of our subsidiaries outside the US are prepared using
the local currency as the functional currency and translated into US dollars. As a result, fluctuations in the exchange rate of the US dollar
relative to the functional currencies of our subsidiaries could cause fluctuations in our results of operations. We also have foreign currency
exposure to the extent net sales and purchases are not denominated in a subsidiary’s functional currency, which could have an adverse effect
on our business, results of operations, or cash flows.
The Company’s non-U.S. sales represent an increasing portion of its revenues, and consequently, the company is exposed to
risks associated with operating internationally. In 2021 and 2020, approximately 22% and 12%, respectively, of the Company’s net sales
came from its operations outside the United States. As a result of the Company’s international sales and locations, its operations are subject
to a variety of risks that are specific to international operations, including the following:
●
import and export regulations that could erode profit margins or restrict exports;
●
the burden and cost of compliance with international laws, treaties, and technical standards and changes in those regulations;
●
potential restrictions on transfers of funds;
●
import and export tariffs, duties and value-added taxes;
●
transportation delays and interruptions;
●
the burden and cost of compliance with complex multi-national tax laws and regulations;
●
uncertainties arising from local business practices and cultural considerations;

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●
foreign laws that potentially discriminate against companies which are headquartered outside that jurisdiction;
●
stringent antitrust regulations in local jurisdictions;
●
volatility associated with sovereign debt of certain international economies;
●
the uncertainty surrounding the implementation and effects of Brexit;
●
potential military conflicts and political risks; and
●
currency fluctuations, which the company attempts to minimize through traditional hedging instruments.
Legal and Regulatory Risks
We may be liable for misuse of our customers’ or employees’ information. Third-parties, such as hackers, could circumvent or
sabotage the security practices and products used in our product and service offerings, and/or the security practices or products used in our
internal IT systems, which could result in disclosure of sensitive or personal information, unauthorized procurement, or other business
interruptions that could damage our reputation and disrupt our business. Attacks may range from random attempts to coordinated and
targeted attacks, including sophisticated computer crime and advanced persistent threats.
As our employees continue to work on a hybrid environment, which includes splitting time between working from the office and
working from home, as a result of the COVID-19 pandemic, we are highly reliant on the availability and functionality of our information
systems to enable for our operations. Working from home may increase risk of data loss, including privacy-related events. If our
information systems are not operational for reasons which may include cyber security attacks, data center failures, failures by telecom
providers to provide services to our business and to our employees’ homes, power failures, or failures of off-premise software such as SaaS
based software, our business and financial results may be adversely impacted.
If third-parties or our employees are able to maliciously penetrate our network security or otherwise misappropriate our
customers’ information or employees’ personal information, or other information for which our customers may be responsible and for
which we agree to be responsible in connection with service contracts into which we may enter, or if we give third-parties or our employees
improper access to certain information, we could be subject to liability. This liability could include claims for unauthorized access to
devices on our network; unauthorized access to our customers’ networks, hardware, applications, data, devices, or software; unauthorized
purchases with credit card information; and identity theft or other similar fraud-related claims. This liability could also include claims for
other misuses of or inappropriate access to personal information. Other liability could include claims alleging misrepresentation of our
privacy and data security practices. Any such liability for misappropriation of this information could decrease our profitability. In addition,
federal and state agencies have been investigating various companies regarding whether they misused or inadequately secured information.
We could incur additional expenses when new laws or regulations regarding the use, safeguarding, or privacy of information are enacted, or
if governmental agencies require us to substantially modify our privacy or security practices. We could fail to comply with international and
domestic data privacy laws, the violation of which may result in audits, fines, penalties, litigation, or administrative enforcement actions
with associated costs.
Our operations are subject to numerous complex federal, state, provincial, local and foreign laws and regulations in a number
of areas, including labor and employment, advertising, e-commerce, tax, trade, import and export requirements, economic and trade
sanctions, anti-corruption, data privacy requirements (including those under the European Union General Data Protection Regulation
and the California Consumer Privacy Act), anti-competition, environmental and health and safety. The evaluation of, and compliance
with these laws, regulations and similar requirements may be onerous and expensive, and these laws and regulations may have other
adverse impacts on our business, results of operations or cash flows. Furthermore, these laws and regulations are evolving and may be
inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance and doing business, and the risk of noncompliance.
We have implemented policies and procedures designed to help ensure compliance with applicable laws and regulations, but there
can be no guarantee against coworkers, contractors or agents violating such laws and regulations or

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our policies and procedures. As a public company, we also are subject to increasingly complex public disclosure, corporate governance and
accounting requirements that increase compliance costs and require significant management focus.
The Company may be subject to intellectual property rights claims, which are costly to defend, could require payment of
damages or licensing fees and could limit the company's ability to use certain technologies in the future. Certain of the Company's
products and services include intellectual property owned primarily by the Company's third-party vendor partners. Substantial litigation and
threats of litigation regarding intellectual property rights exist in the software and some service industries. From time to time, third parties
(including certain companies in the business of acquiring patents not for the purpose of developing technology but with the intention of
aggressively seeking licensing revenue from purported infringers) may assert patent, copyright and/or other intellectual property rights to
technologies that are important to the company's business. In some cases, depending on the nature of the claim, the Company may be able
to seek indemnification from its vendor partners for itself and its customers against such claims, but there is no assurance that it will be
successful in obtaining such indemnification or that the Company is fully protected against such claims. Any infringement claim brought
against the Company, regardless of the duration, outcome, or size of damage award, could result in substantial cost to the Company, divert
management's attention and resources, be time consuming to defend, result in substantial damage awards, or cause product shipment delays.
Additionally, if an infringement claim is successful the Company may be required to pay damages or seek royalty or license
arrangements, which may not be available on commercially reasonable terms. The payment of any such damages or royalties may
significantly increase the Company's operating expenses and harm the Company's operating results and financial condition. Also, royalty or
license arrangements may not be available at all. The Company may have to stop selling certain products or using technologies, which
could affect the Company's ability to compete effectively.
Our business could be negatively affected as a result of the actions of activist shareholders. Publicly traded companies have
increasingly become subject to campaigns by activist investors advocating corporate actions such as financial restructurings, increased
borrowings, special dividends, stock repurchases or even sales of assets or entire companies to third parties or the activists themselves.
Responding to proxy contests and other actions by activist shareholders can be costly and time-consuming, disrupt our operations and divert
the attention of our Board of Directors and senior management from the pursuit of business strategies, which could adversely affect our
results of operations and financial condition. Additionally, perceived uncertainties as to our future direction as a result of shareholder
activism or changes to the composition of the Board of Directors may lead to the perception of a change in the direction of the business,
instability or lack of continuity.  These uncertainties may be more acute or heightened when an activist seeks to change a majority of the
Board of Directors or ultimately desires to acquire the Company. Additionally, actions by activist shareholders may be exploited by our
competitors, cause concern to our current or potential customers, make it more difficult to attract and retain qualified personnel and may
create adverse uncertainty for our employees.
The interest rate of our credit facility is priced using LIBOR and is subject to risks associated with the transition from LIBOR
to an alternative reference rate that could adversely affect our business, operating results, and financial condition. LIBOR is the basic
rate of interest used in lending between banks on the London interbank market and is widely used as a reference for setting the interest rate
on loans globally. We typically use LIBOR as a reference rate in our credit facility. In July 2017, the U. K.’s Financial Conduct Authority,
which regulates LIBOR, announced that it intends to phase out LIBOR by the end of 2021 and while the transition period for many LIBOR
tenors has been extended to June 2023, the U.S. Federal Reserve advised banks to stop new LIBOR issuances by the end 2021. At this time,
no consensus exists as to which reference rate or rates or benchmarks may become acceptable alternatives to LIBOR. The Alternative
Reference Rates Committee, a steering committee comprised of U.S. financial market participants, has identified the secured overnight
financing rate, or SOFR, as the recommended alternative rate for all LIBOR. At this time, it is impossible to predict whether the SOFR or
another reference rate will become an accepted alternative to LIBOR.   Any changes in the methods by which LIBOR is determined or
regulatory activity related to LIBOR’s phaseout could cause LIBOR to perform differently than in the past or cease to exist. Further, the
consequences of these developments, or any alternative reference rate that is adopted, cannot be entirely predicted but could include an
increase in the cost of our variable rate debt, which could adversely impact our interest expense, results of operations and cash flows.

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Changes in accounting rules, or the misapplication of current accounting rules, may adversely affect our future financial
results. We prepare our financial statements in conformity with accounting principles generally accepted in the U.S. These accounting
principles are subject to interpretation by the Financial Accounting Standards Board, the Public Company Accounting Oversight Board, the
SEC, the American Institute of Certified Public Accountants (“AICPA”) and various other bodies formed to interpret and create appropriate
accounting policies. Future periodic assessments required by current or new accounting standards may result in noncash charges and/or
changes in presentation or disclosure. In addition, any change in accounting standards may influence our customers’ decision to purchase
from us or finance transactions with us, which could have a significant adverse effect on our financial position or results of operations.
We are required to determine if we are the principal or agent in all transactions with our customers. The voluminous number of
products and services we sell, and the manner in which they are bundled, are technologically complex. Mischaracterization of these
products and services could result in misapplication of revenue recognition polices. We use estimates where necessary, such as allowance
for doubtful accounts and product returns, which require judgment and are based on best available information. If we are unable to
accurately estimate the cost of these services or the timeline for completion of contracts, the profitability of our contracts may be materially
and adversely affected.
Financial Risks and Market Risks
Our quarterly financial results may fluctuate, which could lead to volatility in our stock price. Our revenue and operating results
have fluctuated from quarter to quarter in the past and may continue to do so in the future. As a result, you should not rely on quarter-to-
quarter comparisons of our operating results as an indication of our future performance. Fluctuations in our revenue and operating results
could negatively affect the trading price of our stock. In addition, our revenue and results of operations may, in the future, be below the
expectations of analysts and investors, which could cause our stock price to decline. Factors that are likely to cause our revenue and
operating results to fluctuate include the risk factors discussed throughout this section.
The Company’s goodwill and identifiable intangible assets could become impaired, which could reduce the value of its assets
and reduce its net income in the year in which the write-off occurs. Goodwill represents the excess of the cost of an acquisition over the
fair value of the assets acquired. The Company also ascribes value to certain identifiable intangible assets, which consist primarily of
customer relationships and trade names, among others, as a result of acquisitions. The Company may incur impairment charges on goodwill
or identifiable intangible assets if it determines that the fair values of the goodwill or identifiable intangible assets are less than their current
carrying values. The Company evaluates, on a regular basis, whether events or circumstances have occurred that indicate all, or a portion, of
the carrying amount of goodwill or identifiable intangible assets may no longer be recoverable, in which case an impairment charge to
earnings would become necessary.
A decline in general economic conditions, a substantial increase in market interest rates, and increase in income tax rates, or the
company’s inability to meet long-term working capital or operating income projections could impact future valuations of the Company’s
reporting units, and the company could be required to record an impairment charge in the future, which could impact the company’s
consolidated balance sheets, as well as the company’s consolidated statements of operations. If the Company were required to recognize an
impairment charge in the future, the charge would not impact the company’s consolidated cash flows, current liquidity, capital resources,
and covenants under its existing revolving credit facility, North America asset securitization program, and other outstanding borrowings.
The inability to obtain financing on favorable terms will adversely impact our business, financial position and results of
operations. Our business requires working capital to operate and to finance accounts receivable and product inventory that are not financed
by trade creditors. We have historically relied upon cash generated from operations, revolving credit facilities and trade credit from our
vendors to satisfy our capital needs and finance growth. As the financial markets change, the cost of acquiring financing and the methods of
financing may change. Changes in our credit rating or other market factors may increase our interest expense or other costs of capital, or
capital may not be available to us on competitive terms to fund our working capital needs. 

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13
We may not be able to continue to pay dividends on our Common Stock in the future, which could impair the value of our
Common Stock. We have paid a quarterly dividend on our Common Stock since the first quarter of 2003. Any future declaration of
dividends remains subject to further determination from time to time by our Board of Directors. Our ability to pay dividends in the future
will depend on our financial results, liquidity and financial condition. There is no assurance that we will be able to pay dividends in the
future, or if we are able to, that our Board of Directors will continue to declare dividends in the future, at current rates or at all. If we
discontinue or reduce the amount or frequency of dividends, the value of our Common Stock may be impaired.
Risks related to our Common Stock. The exercise of options or any other issuance of shares by us may dilute your ownership of
our Common Stock. Trading volume in our Common Stock varies significantly based on a number of factors, which may be exacerbated by
our repurchases of our Common Stock. As a result of the potentially low volume trading market for our stock, its market price may
fluctuate significantly more than the stock market as a whole or of the stock prices of similar companies. Without a larger float, our
Common Stock will be less liquid than the stock of companies with broader public ownership, and, as a result, the trading prices for our
Common Stock may be more volatile. Among other things, trading of a relatively small volume of our Common Stock may have a greater
impact on the trading price of our stock than would be the case if our public float were larger.
Our Common Stock is listed on The NASDAQ Global Market, and we therefore are subject to continued listing requirements,
including requirements with respect to the market value and number of publicly-held shares, number of stockholders, minimum bid price,
number of market makers and either (i) stockholders’ equity or (ii) total market value of stock, total assets and total revenues. If we fail to
satisfy one or more of the requirements, we may be delisted from The NASDAQ Global Market. If we do not qualify for listing on The
NASDAQ Capital Market, and if we are not able to list our Common Stock on another exchange, our Common Stock could be quoted on
the OTC Bulletin Board or on the “pink sheets”. As a result, we could face significant adverse consequences including, among others, a
limited availability of market quotations for our securities and a decreased ability to issue additional securities or obtain additional financing
in the future.
General Risk Factors
Global and regional economic and political conditions may have an adverse impact on our business. Weak economic conditions
generally, sustained uncertainty about global economic and political conditions, government spending cuts and the impact of new
government policies, or a tightening of credit markets, could cause our customers and potential customers to postpone or reduce spending
on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of
operations or cash flows. For example, there continues to be substantial uncertainty regarding the economic impact of the UK's exit from
the European Union ("EU"), referred to as "Brexit". The UK formally withdrew from EU membership on January 31, 2020 and commenced
a transition period during which the trading relationship between the UK and the EU will remain the same and the UK and EU will begin
negotiations to determine their future relationship. Although the full effects of Brexit are uncertain and will be dependent on the outcome of
such negotiations, potential adverse consequences of Brexit include global market uncertainty, volatility in currency exchange rates, greater
restrictions on imports and exports between the UK and other countries, and increased regulatory complexities, each of which could have a
negative impact on our business, financial condition or results of operations. These effects may be amplified if the UK and the EU fail to
agree on a future trade relationship, which could result in significant market and economic disruption. We have established a presence in the
Netherlands to help address future developments, as needed, for Brexit, which could add complexity to our European operations as well as
result in higher costs associated with serving our customers following the transition period.
If the Company fails to maintain an effective system of internal controls or discovers material weaknesses in its internal
controls over financial reporting, it may not be able to report its financial results accurately or timely or detect fraud, which could have
a material adverse effect on its business. An effective internal control environment is necessary for the Company to produce reliable
financial reports and is an important part of its effort to prevent financial fraud. The Company is required to annually evaluate the
effectiveness of the design and operation of its internal controls over financial reporting. Based on these evaluations, the Company may
conclude that enhancements, modifications, or changes to internal controls are necessary or desirable. While management evaluates the
effectiveness of the Company's internal controls on a regular basis, these controls may not always be effective. There are inherent
limitations on the

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effectiveness of internal controls, including collusion, management override, and failure in human judgment. In addition, control procedures
are designed to reduce rather than eliminate financial statement risk. If the Company fails to maintain an effective system of internal
controls, or if management or the Company's independent registered public accounting firm discovers material weaknesses in the
Company's internal controls, it may be unable to produce reliable financial reports or prevent fraud, which could have a material adverse
effect on the Company's business. In addition, the Company may be subject to sanctions or investigation by regulatory authorities, such as
the SEC or the NASDAQ. Any such actions could result in an adverse reaction in the financial markets due to a loss of confidence in the
reliability of the Company's financial statements, which could cause the market price of its Common Stock to decline or limit the
Company's access to capital.
Changes in income tax and other regulatory legislation. We operate in compliance with applicable laws and regulations and
make plans for our structure and operations based upon existing laws and anticipated future changes in the law. When new legislation is
enacted with minimal advance notice, or when new interpretations or applications of existing laws are made, we may need to implement
changes in our policies or structure. We are susceptible to unanticipated changes in legislation, especially relating to income and other
taxes, import/export laws, hazardous materials and other laws related to trade, accounting and business activities. Such changes in
legislation may have an adverse effect on our business.
We may be subject to litigation. We may be subject to legal claims or regulatory matters involving stockholder, consumer,
antitrust, intellectual property and other issues. Litigation is subject to inherent uncertainties, and unfavorable rulings could occur. An
unfavorable ruling could include monetary damages or other adverse effects. Were an unfavorable ruling to occur, there exists the
possibility of a material adverse impact on our business, financial position and results of operations for the period in which the ruling
occurred or future periods.
Item 1B. Unresolved Staff Comments
Not applicable.
Item 2. Properties
The Company leases approximately 20,000 square feet of space in Eatontown, New Jersey for its corporate headquarters under a
lease expiring in April 2027. Total annual rent expense for this premise is approximately $420,000. Commencing in the first quarter of
2022, the Company will be subleasing approximately 7,165 square feet of this space under a sublease expiring in April 2027. Total annual
sublease income for this space will be approximately $135,000.
The Company also leases 7,800 square feet of warehouse space in Eatontown, New Jersey under a lease expiring in December
2023. Total annual rent expense for such warehouse space is approximately $60,000. The Company also leases office space in the United
Kingdom under a lease expiring in April 2026. Total annual rent expense for this premise is approximately $70,000.
We believe that each of the properties is in good operating condition and that such properties are adequate for the operation of the
Company’s business as currently conducted. We also rent smaller satellite offices on a short-term basis.
Item 3. Legal Proceedings
We are involved from time to time in routine legal matters and other claims incidental to our business. We review outstanding
claims and proceedings internally and with external counsel as necessary to assess probability and amount of potential loss. There are no
material legal proceedings to which the Company or any of its subsidiaries is a party or of which any of their property is the subject.
Item 4. Mine Safety Disclosures
Not applicable.

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15
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Shares of our Common Stock, par value $0.01, trade on The NASDAQ Global Market under the symbol “WSTG”.
Dividends
In each of 2021 and 2020, we declared dividends totaling $0.68 per share on our Common Stock. The payment of future dividends
is at the discretion of our Board of Directors and dependent on results of operations, projected capital requirements and other factors the
Board of Directors may find relevant. There can be no assurance that we will continue to pay comparable cash dividends in the future.
Shareholder Information
As of February 15, 2022, there were approximately 22 record holders of our Common Stock. This figure does not include an
estimate of the number of beneficial holders whose shares are held of record by brokerage firms and clearing agencies.

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16
Purchases of Equity Securities
During the fourth quarter of 2021, we repurchased shares of our Common Stock as follows:
    
    
    
    
    Maximum  
Number of  
Total Number
Shares That  
of Shares
May Yet Be  
Purchased as
Purchased
Total
Average
Part of Publicly
Under the  
Number
Price Paid
Announced
Average
 Plans or
 
of Shares
Per Share
Plans or
Price Paid
Programs
 
Period
Purchased
(2)
Programs
Per Share
(3)
 
October 1, 2021 - October 31, 2021
 
 —
$
 —  
 —
$
 —  
 547,288
November 1, 2021 - November 30, 2021
 
 4,990 (1)$
 29.92  
 —
$
 —
 547,288
December 1, 2021 - December 31, 2021
 
 —
$
 —  
 —
$
 —  
 547,288
Total
 
 4,990
$
 29.92  
 —
$
 —  
 547,288
(1) Represents 4,990 shares surrendered to the Company by employees to satisfy individual tax withholding obligations upon vesting of
previously issued shares of Restricted Stock. These shares are not included in the Common Stock repurchase program referred to in
footnote (3) below.
(2) Average price paid per share reflects the closing price of the Company’s Common Stock on the business date the shares were
surrendered by the employee stockholder to satisfy individual tax withholding obligations upon vesting of Restricted Stock or the price
of the Common Stock paid on the open market purchase, as applicable.
(3) On December 3, 2014, the Board of Directors of the Company approved an increase of 500,000 shares of Common Stock to the number
of shares of Common Stock available for repurchase under its repurchase plans. On February 2, 2017, the Board of Directors of the
Company approved an increase of 500,000 shares of Common Stock to the number of shares of Common Stock available for repurchase
under its repurchase plans. The Company expects to purchase shares of its Common Stock from time to time in the market or otherwise
subject to market conditions. The Common Stock repurchase program does not have an expiration date.
Item 6. [Reserved]
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following management’s discussion and analysis of the Company’s financial condition and results of operations should be
read in conjunction with the Company’s Consolidated Financial Statements and the Notes thereto.  This discussion and analysis contains,
in addition to historical information, forward-looking statements that involve risks and uncertainties. Our actual results may differ
materially from those anticipated in these forward-looking statements as a result of certain risks and uncertainties, including those set forth
under the heading “Risk Factors” and elsewhere in this report.
Overview
Our Company is a value added IT distribution and solutions company, primarily selling software and other third-party IT products
and services through two reportable operating segments. Through our “Distribution” segment we sell products and services to corporate
resellers, value added resellers (VARs), consultants and systems integrators worldwide, who in turn sell these products to end users.
Through our “Solutions” segment we act as a cloud solutions provider and value-added reseller, selling computer software and hardware
developed by others and provide technical services directly

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to end user customers worldwide. We offer an extensive line of products from leading software vendors and tools for virtualization/cloud
computing, security, networking, storage and infrastructure management, application lifecycle management and other technically
sophisticated domains as well as computer hardware. We market these products through creative marketing communications, including our
web sites, local and on-line seminars, webinars, social media, direct e-mail, and printed materials.
We have subsidiaries in the United States, Canada, Netherlands, United Kingdom and Ireland, through which sales are made.
COVID-19
We continue to closely monitor the impact of the COVID-19 pandemic on all aspects of our business. COVID-19 continues to
create macroeconomic uncertainty, volatility and disruption, including supply constraints. The supply constraints are being caused primarily
by component availability, resulting in extended lead times and unpredictability. In 2021, customer top priorities have been digital
transformation, security, hybrid and cloud solutions, client devices, and preparing for workers to return to the office and enhancing remote
enablement capabilities as hybrid environments become the future work model. We have orchestrated solutions by leveraging client
devices, accessories, collaboration tools, security, software and hybrid and cloud offerings to help customers build these capabilities and
achieve their objectives.
Our employees continue to work in a hybrid environment, which includes splitting time between working from the office and
working from home, as a result of the COVID-19 pandemic.
While we did not incur significant disruptions to our operations during the year ended December 31, 2021 as a result of the
COVID-19 pandemic, as the duration and ongoing economic impacts of the COVID-19 pandemic remain uncertain, we are unable to
predict the future impact this will have on our business, liquidity or results of operations at this time. Technology trends could also change
as customers consider the impact of the COVID-19 pandemic on their operations.
This situation is changing rapidly, and additional impacts may arise that we are not aware of currently. We will continue to
actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state or local
authorities or that we determine are in the best interests of our employees, customers and shareholders.
Factors Influencing Our Financial Results
We derive most of our net sales though the sale of third-party software licenses, maintenance and service agreements. In our
Distribution segment, sales are impacted by the number of product lines we distribute, and sales penetration of those products into the
reseller channel, product lifecycle competitive, and demand characteristics of the products which we are authorized to distribute. In our
Solutions segment sales are generally driven by sales force effectiveness and success in providing superior customer service and cloud
solutions support, competitive pricing, and flexible payment solutions to our customers. Our sales are also impacted by external factors such
as levels of IT spending and customer demand for products we distribute.
We sell in a competitive environment where gross product margins have historically declined due to competition and changes in
product mix towards products where no delivery of a physical product is required. In addition, we grant discounts, allowances, and rebates
to certain customers, which may vary from period to period, based on volume, payment terms and other criteria. To date, we have been able
to implement cost efficiencies such as the use of drop shipments, electronic ordering (“EDI”) and other capabilities to be able to operate our
business profitably as gross margins have declined. We evaluate the profitability of our business based on return on equity and effective
margin (see discussion below).
Gross profit is calculated as net sales less cost of sales. We record customer rebates, discounts and returns as a component of net
sales and record vendor rebates, discounts and returns as a component of cost of sales.

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Selling, general and administrative expenses are comprised mainly of employee salaries, commissions and other employee related
expenses, facility costs, costs to maintain our IT infrastructure, public company compliance costs and professional fees. We monitor our
level of accounts payable, inventory turnover and accounts receivable turnover which are measures of how efficiently we utilize capital in
our business.
The Company’s sales, gross profit and results of operations have fluctuated and are expected to continue to fluctuate on a quarterly
basis as a result of a number of factors, including but not limited to: the condition of the software industry in general, shifts in demand for
software products, pricing, industry shipments of new software products or upgrades, fluctuations in merchandise returns, adverse weather
conditions that affect response, distribution or shipping, shifts in the timing of holidays and changes in the Company’s product offerings.
The Company’s operating expenditures are based on sales forecasts. If sales do not meet expectations in any given quarter, operating results
may be materially adversely affected.
Dividend Policy and Share Repurchase Program. Historically we have sought to return value to investors through the payment of
quarterly dividends and share repurchases. Total dividends paid and the dollar value of shares repurchased were $3.0 million and $0.5
million for the year ended December 31, 2021, respectively, and $3.0 million and $3.7 million for the year ended December 31, 2020,
respectively. The payment of future dividends is at the discretion of our Board of Directors and dependent on results of operations,
projected capital requirements and other factors the Board of Directors may find relevant.
Stock Volatility. The technology, distribution and services sectors of the United States stock markets is subject to substantial
volatility. Numerous conditions which impact these sectors or the stock market in general or the Company in particular, whether or not such
events relate to or reflect upon the Company’s operating performance, could adversely affect the market price of the Company’s Common
Stock. Furthermore, fluctuations in the Company’s operating results, announcements regarding litigation, the loss of a significant vendor
partner or customer, increased competition, reduced vendor incentives and trade credit, higher operating expenses, and other developments,
could have a significant impact on the market price of our Common Stock.
Financial Overview
Net sales increased 12%, or $31.0 million, to $282.6 million for the year ended December 31, 2021, compared to $251.6 million
for the same period in 2020. Gross profit increased 38%, or $12.7 million, to $45.7 million for the year ended December 31, 2021,
compared to $33.0 million for the same period in 2020. Selling, general and administrative (“SG&A”) expenses increased 34%, or $8.2
million, to $32.1 million for the year ended December 31, 2021, compared to $23.9 million for the same period in 2020. There were no
legal and financial advisory expenses, net - unsolicited bid and related matters for the year ended December 31, 2021 compared to $1.6
million in expense for the same period in 2020. There were no acquisition related costs for the year ended December 31, 2021 compared to
$1.5 million in expense for the same period in 2020. Amortization and depreciation expense increased $0.8 million to $1.5 million for the
year ended December 31, 2021 compared to $0.7 million for the same period in the prior year. Net income was $9.2 million for the year
ended December 31, 2021 compared to $4.5 million for the same period in 2020. Income per diluted share was $2.09 for the year ended
December 31, 2021 compared to $1.01 for the same period in 2020.
Critical Accounting Policies and Estimates
Management’s discussion and analysis of the Company’s financial condition and results of operations are based upon the
Company’s Consolidated Financial Statements that have been prepared in accordance with generally accepted accounting principles in the
United States of America (“US GAAP”). The preparation of these financial statements requires the Company to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and
liabilities.
On an on-going basis, the Company evaluates its estimates, including those related to product returns, bad debts, inventories,
investments, intangible assets, income taxes, stock-based compensation, contingencies and litigation.

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The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimates.
The Company believes the following critical accounting policies used in the preparation of its Consolidated Financial Statements
affect its more significant judgments and estimates.
Revenue
The Company utilizes judgment regarding performance obligations inherent in the products for services it sells including, whether
ongoing maintenance obligations performed by third party vendors are distinct from the related software licenses, and allocation of sales
prices among distinct performance obligations. These estimates require significant judgment to determine whether the software’s
functionality is dependent on ongoing maintenance or if substantially all functionality is available in the original software download. We
also use judgment in the allocation of sales proceeds among performance obligations, utilizing observable data such as stand-alone selling
prices, or market pricing for similar products and services.
Allowances for Accounts Receivable
The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to
make required payments. Management determines the estimate of the allowance for uncollectible accounts receivable by considering a
number of factors, including historical experience, aging of the accounts receivable, and specific information obtained by the Company on
the financial condition and the current creditworthiness of its customers. If the financial condition of the Company’s customers were to
deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. At the time of sale, we
record an estimate for sales returns based on historical experience, which is included in accounts payable and accrued expenses on the
Consolidated Balance Sheets. If actual sales returns are greater than estimated by management, additional expense may be incurred.
Accounts Receivable – Long Term
The Company’s accounts receivable long-term are discounted to their present value at prevailing market rates at the time of sale.
In doing so, the Company considers competitive market rates and other relevant factors.
Inventory Allowances
The Company writes down its inventory for estimated obsolescence or unmarketable inventory equal to the difference between the
cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If actual market
conditions are less favorable than those projected by management, additional inventory write-offs may be required.
Business Combinations
The Company accounts for business combinations using the acquisition method of accounting, which allocates the fair value of the
purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess
of the purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. When determining the
fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions. The Company may utilize
third-party valuation specialists to assist the Company in the allocation. Initial purchase price allocations are subject to revision within the
measurement period, not to exceed one year from the date of acquisition. Acquisition-related expenses and transaction costs associated with
business combinations are expensed as incurred.

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Goodwill
We test goodwill for impairment on an annual basis and between annual tests if an event occurs, or circumstances change, that
would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company performs an evaluation of
goodwill, utilizing either a qualitative or quantitative impairment test. The annual test for impairment is conducted as of October 1. The
Company’s reporting units included in the assessment of potential goodwill impairment are the same as its operating segments. Goodwill is
not amortized but is subject to periodic testing for impairment at the reporting unit level.
In a qualitative assessment, we assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of
more than 50 percent) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If, after assessing the
totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its
carrying amount, then the quantitative goodwill impairment test is unnecessary.
If, after assessing the totality of events or circumstances, we determine that it is more likely than not that the fair value of a
reporting unit is less than its carrying amount, then we perform the quantitative goodwill impairment test. We may also elect the
unconditional option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the
quantitative goodwill impairment test.
In the quantitative impairment test, we compare the fair value of a reporting unit with its carrying amount, including goodwill. If
the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. Conversely, if the
carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited
to the total amount of goodwill allocated to that reporting unit.
Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions,
including net sales growth rates, gross profit margins, operating margins, discount rates and future market conditions, among others. Any
changes in the judgments, estimates or assumptions used could produce significantly different results.
Intangible Assets
Intangible assets with determinable lives are amortized on a straight-line basis over their respective estimated useful lives, which is
determined based on their expected period of benefit. Intangible assets are reviewed for impairment when events or changes in
circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an
estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. If the carrying amount of an asset
exceeds its estimated future undiscounted cash flows, an impairment loss is recorded for the excess of the asset's carrying amount over its
fair value. In addition, each quarter, the Company evaluates whether events and circumstances warrant a revision to the remaining estimated
useful life of each of these intangible assets. If the Company were to determine that a change to the remaining estimated useful life of an
intangible asset was necessary, then the remaining carrying amount of the intangible asset would be amortized prospectively over that
revised remaining useful life.
Income Taxes
The Company has considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need
for the valuation allowance related to deferred tax assets. In the event the Company were to determine that it would not be able to realize all
or part of its net deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to income in the period such
determination was made.

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21
Share-Based Payments
Under the fair value recognition provision, stock-based compensation cost is measured at the grant date based on the fair value of
the award and is recognized as expense on a straight-line basis over the requisite service period. We make certain assumptions in order to
value and expense our various share-based payment awards. In connection with our restricted stock programs we record the forfeitures
when they occur. We review our valuation assumptions periodically and, as a result, we may change our valuation assumptions used to
value stock-based awards granted in future periods. Such changes may lead to a significant change in the expense we recognize in
connection with share-based payments.
Foreign Exchange
The Company’s foreign currency exposure relates primarily to international transactions where the currency collected from
customers can be different from the currency used to purchase the product. In cases where the Company is not able to create a natural hedge
by maintaining offsetting asset and liability amounts in the same currency, it may enter into foreign exchange contracts, typically in the
form of forward purchase agreements, to facilitate the hedging of foreign currency exposures to mitigate the impact of changes in foreign
currency exchange rates. These contracts generally have terms of no more than two months. The Company does not apply hedge accounting
to these contracts and therefore the changes in fair value are recorded in earnings. The Company does not enter into foreign exchange
contracts for trading purposes and the risk of loss on a foreign exchange contract is the risk of nonperformance by the counterparties, which
the Company minimizes by limiting its counterparties to major financial institutions. The fair value of forward purchase contracts at
December 31, 2021 was not material to the consolidated financial statements.
Recently Issued Accounting Pronouncements
In June 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments - Credit Losses (Topic 326)”
("ASU 2016-13"). ASU 2016-13 revises the methodology for measuring credit losses on financial instruments and the timing of when such
losses are recorded. Originally, ASU 2016-13 was effective for fiscal years, and for interim periods within those fiscal years, beginning
after December 15, 2019, with early adoption permitted. In November 2019, FASB issued ASU 2019-10, “Financial Instruments – Credit
Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842).”  This ASU defers the effective date of ASU 2016-13
for public companies that are considered smaller reporting companies as defined by the SEC to fiscal years beginning after December 15,
2022, including interim periods within those fiscal years. The Company is planning to adopt this standard in the first quarter of fiscal 2023.
The Company is currently evaluating the potential effects of adopting the provisions of ASU No. 2016-13 on its Consolidated Financial
Statements, particularly its recognition of allowances for accounts receivable.

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Results of Operations
The following table sets forth for the years indicated the percentage of net sales represented by selected items reflected in the
Company’s Consolidated Statements of Earnings. The year-to-year comparison of financial results is not necessarily indicative of future
results:
Year ended
December 31,
    
2021
    
2020
    
    
Net sales
 
 100.0 %  
 100.0 %   
Cost of sales
 
 83.8
 86.9
 
Gross profit
 
 16.2
 13.1
 
Selling, general and administrative expenses
 
 11.4
 9.5
 
Legal and financial advisory expenses, net - unsolicited bid and related matters
 —
 0.6
Acquisition related costs
 —
 0.6
Amortization and depreciation expense
 0.5
 0.3
Income from operations
 
 4.3
 2.1
 
Other (expense) income
 
 0.1
 0.4
 
Income before income taxes
 
 4.4
 2.5
 
Income tax provision
 
 1.1
 0.7
 
Net income
 
 3.3 %  
 1.8 %   
Non-GAAP Financial Measures
Our management monitors several financial and non-financial measures and ratios on a regular basis in order to track the progress
of our business. We believe that the most important of these measures and ratios include net sales, adjusted gross billings, gross profit, net
income, net income excluding separation expenses, net of taxes, adjusted EBITDA, gross profit as a percentage of adjusted gross billings
and adjusted EBITDA as a percentage of gross profit. We use a variety of operating and other information to evaluate the operating
performance of our business, develop financial forecasts, make strategic decisions, and prepare and approve annual budgets. These key
indicators include financial information that is prepared in accordance with US GAAP and presented in our Consolidated Financial
Statements as well as non-US GAAP performance measurement tools.
Year ended
December 31,
December 31,
Reconciliation of net sales to adjusted gross billings (Non-GAAP):
2021
2020
Net sales
$
282,582
$
251,568
Costs of sales related to sales where the Company is an agent
652,396
477,671
Adjusted gross billings
$
934,978
$
729,239

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23
We define adjusted gross billings as net sales in accordance with US GAAP, adjusted for the cost of sales related to sales where
the Company is an agent. We provided a reconciliation of adjusted gross billings to net sales, which is the most directly comparable US
GAAP measure. We use adjusted gross billings of product and services as a supplemental measure of our performance to gain insight into
the volume of business generated by our business, and to analyze the changes to our accounts receivable and accounts payable. Our use of
adjusted gross billings of product and services as analytical tools has limitations, and you should not consider them in isolation or as
substitutes for analysis of our financial results as reported under US GAAP. In addition, other companies, including companies in our
industry, might calculate adjusted gross billings of product and services or similarly titled measures differently, which may reduce their
usefulness as comparative measures.
Year ended
December 31,
December 31,
Net income reconciled to adjusted EBITDA:
2021
    
2020
Net income
$
 9,198
$
 4,474
Provision for income taxes
 3,166
 1,746
Amortization and depreciation
 1,529
 704
Interest expense
 68
 116
EBITDA
 13,961
 7,040
Share-based compensation
 1,546
 1,278
Legal and financial advisory expenses, net - unsolicited bid and related matters
 -
 1,586
Acquisition related costs
 -
 1,518
Adjusted EBITDA
$
15,507
$
11,422
We define adjusted EBITDA, as net income, plus provision for income taxes, depreciation, amortization, share-based
compensation, interest, legal and financial advisory expenses, net – unsolicited bid and related matters and acquisition related costs. We
define effective margin as adjusted EBITDA as a percentage of gross profit. We provided a reconciliation of adjusted EBITDA to net
income, which is the most directly comparable US GAAP measure. We use adjusted EBITDA as a supplemental measure of our
performance to gain insight into our businesses profitability when compared to the prior year and our competitors. Adjusted EBITDA is
also a component to our financial covenants in our credit facility. Our use of adjusted EBITDA has limitations, and you should not consider
it in isolation or as a substitute for analysis of our financial results as reported under US GAAP. In addition, other companies, including
companies in our industry, might calculate adjusted EBITDA, or similarly titled measures differently, which may reduce their usefulness as
comparative measures.

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24
Key Financial Metrics
Year ended
December 31,
December 31,
2021
2020
Net sales
$
282,582
$
251,568
Adjusted gross billings (Non-GAAP)
$
934,978
$
729,239
Gross profit
$
45,716
$
33,040
Gross profit - Distribution
$
 36,526
$
 29,136
Gross profit - Solutions
$
 9,190
$
 3,904
Adjusted EBITDA (Non-GAAP)
$
15,507
$
11,422
Gross margin % - Adjusted gross billings (Non-GAAP)
4.9%
4.5%
Effective margin % - Adjusted EBITDA (Non-GAAP)
33.9%
34.6%
We consider gross profit growth and effective margin to be key metrics in evaluating our business. During the year ended
December 31, 2021, gross profit increased 38%, or $12.7 million, to $45.7 million compared to $33.0 million for the same period in 2020
while effective margin decreased 70 basis points to 33.9% compared to 34.6% for the same period in 2020.
Year Ended December 31, 2021 Compared to Year Ended December 31, 2020
Acquisitions
On April 30, 2020 we completed the acquisition of Interwork Technologies Inc. (“Interwork”) for a purchase price of $3.6 million,
subject to certain working capital adjustments, and a potential earnout of $0.8 million payable approximately one year after the acquisition
date. The operating results of Interwork are included in our operating results effective May 1, 2020.
On November 6, 2020 we completed the acquisition of CDF Group Limited (“CDF”) for a purchase price of $17.4 million, subject
to certain working capital adjustments. The operating results of CDF are included in our operating results effective November 7, 2020.
Operating results of Interwork are included in our Distribution segment. Operating results of CDF are included in both our
Distribution segment or Solutions segment.
Net Sales
Net sales for the year ended December 31, 2021 increased 12%, or $31.0 million, to $282.6 million compared to $251.6 million for
the same period in 2020.
Adjusted gross billings, a non-GAAP financial measure, for the year ended December 31, 2021 increased 28%, or $205.8 million,
to $935.0 million compared to $729.2 million for the same period in 2020.
Net sales in our Distribution segment for the year ended December 31, 2021 increased 11%, or $25.6 million, to $259.4 million
compared to $233.8 million for the same period in the prior year. The increase in net sales in our Distribution segment was due to both
organic growth from our existing vendor lines and the impact of the CDF and Interwork acquisitions for the full year ended December 31,
2021. Adjusted gross billings for the Distribution segment for the year ended December 31, 2021 increased 25%, or $172.2 million, to
$872.3 million compared to $700.1 million for the same period in 2020.

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 Net sales in our Solutions segment for the year ended December 31, 2021 increased 30%, or $5.4 million, to $23.2 million
compared to $17.8 million for the prior year. The increase in net sales in our Solutions segment was primarily due to the impact of the CDF
acquisition for the full year ended December 31, 2021. Adjusted gross billings for the Solutions segment for the year ended December 31,
2021 increased 116%, or $33.6 million, to $62.7 million compared to $29.1 million for the same period in 2020.
During the year ended December 31, 2021, we relied on two key customers for a total of 35% of our total net sales. One major
customer accounted for 18% and the other for 17%, of our total net sales during the year ended December 31, 2021. These same customers
accounted for 18% and 22%, of total net accounts receivable as of December 31, 2021.
Gross Profit
Gross profit for the year ended December 31, 2021 increased 38%, or $12.7 million, to $45.7 million compared to $33.0 million
for the same period in 2020.
Distribution segment gross profit for the year ended December 31, 2021 increased 25%, or $7.4 million, to $36.5 million
compared to $29.1 million for the same period in 2020. The increase in Distribution segment gross profit resulted primarily from the impact
of the acquisition of CDF and Interwork acquisitions for the full year ended December 31, 2021 and lower early pay discounts and other
rebates and discounts offered to our customers as a percentage of adjusted gross billings.
Solutions segment gross profit for the year ended December 31, 2021 increased 135%, or $5.3 million, to $9.2 million compared
to $3.9 million for the same period in 2020. The increase in Solutions segment gross profit resulted primarily from increased sales from the
acquisition of CDF for the full year ended December 31, 2021.
Customer rebates and discounts for the year ended December 31, 2021 were $8.7 million compared to $6.3 million for the same
period in the prior year. This increase is attributable to a change in payment terms with one of our larger customers during the second
quarter of 2020, as well as increased rebates and discounts to national resellers. Customer rebates and discounts vary based on terms of
rebate and early pay discount programs offered to customers and timing of payments ultimately received from our customers.
Vendor rebates and discounts for the year ended December 31, 2021 were $4.5 million compared to $3.9 million for the same
period in the prior year. Vendor rebates are dependent on programs offered by our vendors and in some cases reaching certain volume
targets set by our vendors. The Company monitors vendor rebate levels, competitive pricing, and gross profit margins carefully. We
anticipate that price competition in our market will continue in both of our business segments.
Selling, General and Administrative Expenses
SG&A expenses for the year ended December 31, 2021 increased 34%, or $8.2 million, to $32.1 million, compared to $23.9
million for the same period in the prior year primarily due to the impact of the acquisition of CDF and Interwork for the full year ended
December 31, 2021. SG&A expenses were 3.4% of adjusted gross billings, a non-GAAP financial measure, for the year ended December
31, 2021, compared to 3.3% for the same period in the prior year.
The Company expects that its SG&A expenses, as a percentage of adjusted gross billings, a non-GAAP financial measure, may
vary depending on changes in sales volume, as well as the levels of continuing investments in key growth initiatives. We plan to continue to
expand our investment in information technology to support the growth of our business.
Legal and Financial Advisory Expenses, Net – Unsolicited Bid and Related Matters
There were no legal and financial advisory expenses, net – unsolicited bid and related matters during the year ended December 31,
2021 compared to $1.6 million in expense for the same period in the prior year. These expenses relate to the costs incurred in conjunction
with the unsolicited bid and shareholder demand resolved in the prior year (see Note 14 in the Notes to the Consolidated Financial
Statements).

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Acquisition Related Costs
There were no acquisition related costs for the year ended December 31, 2021 compared to $1.5 million in expense for the same
period in the prior year. These expenses relate to costs incurred in conjunction with the acquisition of CDF and Interwork.
Foreign Currency Transaction (Loss) Gain
Foreign currency transaction loss for the year ended December 31, 2021 was $0.1 million compared to a foreign currency
transaction gain of $0.8 million for the same period in the prior year. These expenses primarily relate to the change in the value of accounts
payable and other monetary assets and liabilities denominated in currencies other than their functional currency between the date of
origination and settlement.
Income Taxes
For the year ended December 31, 2021, the Company recorded a provision for income taxes of $3.2 million, or 25.6% of income
before taxes, compared to $1.7 million, or 28.1% of income before taxes for the same period in the prior year. The provision for income
taxes in the current year was impacted by a deferred tax adjustment due to an increase in the corporate tax rate in a foreign jurisdiction the
Company operates in that will impact the rate at which deferred taxes are reversed in future periods, partially offset by changes in the mix
of jurisdictions in which taxable income was earned. The provision for income taxes in the prior year was impacted by limitations on the
deductibility of certain facilitative acquisition related costs in the prior year.
Liquidity and Capital Resources
Our cash and cash equivalents remained consistent at $29.3 million at December 31, 2021 and December 31, 2020, respectively.
Cash and cash equivalents remaining consistent was primarily the result of $4.7 million of cash and cash equivalents provided by operating
activities, offset by $0.3 million of cash used in investing activities and $4.4 million of cash used in financing activities. 
Net cash provided by operating activities for the year ended December 31, 2021 was $4.7 million, comprised of net income
adjusted for non-cash items of $12.9 million offset by changes in operating assets and liabilities of $8.2 million.
Net cash and cash equivalents used in investing activities during the year ended December 31, 2021 consisted of $0.3 million of
purchases of fixed assets.
Net cash and cash equivalents used in financing activities during the year ended December 31, 2021 was $4.4 million, primarily
comprised of dividend payments on our Common Stock of $3.0 million, contingent consideration paid of $0.9 million and purchases of
treasury stock of $0.5 million.
On December 3, 2014, the Board of Directors of the Company approved an increase of 500,000 shares of Common Stock to the
number of shares of Common Stock available for repurchase under its repurchase plans. On February 2, 2017, the Board of Directors
approved an increase of 500,000 shares of Common Stock to the number of shares of Common Stock available for repurchase under its
repurchase plans. The Company is authorized to purchase 547,288 shares of Common Stock as of December 31, 2021. The Common Stock
repurchase program does not have an expiration date.
As of December 31, 2021, we held 859,828 shares of our Common Stock in treasury at an average cost of $16.13 per share. As of
December 31, 2020, we held 922,503 shares of our Common Stock in treasury at an average cost of $15.99 per share. We intend to hold the
repurchased shares in treasury for general corporate purposes, including issuances under various stock plans.
On November 15, 2017, the Company entered into a $20,000,000 revolving credit facility (the “Credit Facility”) with Citibank,
N.A. (“Citibank”) pursuant to a Second Amended and Restated Revolving Credit Loan Agreement (the

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“Loan Agreement”), Second Amended and Restated Revolving Credit Loan Note (the “Note”), Second Amended and Restated Security
Agreement and Second Amended and Restated Pledge and Security Agreement. On August 31, 2020, the Company entered into an
amendment to the Credit Facility (the “Amended Credit Facility”) pursuant to a First Amendment to Second Amended and Restated
Revolving Credit Loan Agreement and Other Loan Documents (the “Amended Loan Agreement”) and First Allonge to Second Amended
and Restated Revolving Credit Loan Note (the “Amended Note”). The Amended Credit Facility, which will continue to be used for
working capital and general corporate purposes, matures on June 30, 2023, at which time the Company must pay all outstanding principal
of all outstanding loans plus all accrued and unpaid interest, and any, fees, costs and expenses. The interest rate for any borrowings under
the Amended Credit Facility is subject to change from time to time based on the changes in the LIBOR Rate, as defined in the Amended
Loan Agreement (the “Index”). The Index was 2.50% at December 31, 2021.
On April 13, 2021, Wayside Technology UK Holdings Limited (“Wayside UK”), a wholly-owned subsidiary of the Company,
entered into an uncommitted short term credit facility of £8,000,000 (“Uncommitted Credit Facility”) with Citibank N.A., London Branch
(“Citibank London”) pursuant to certain terms and conditions. Obligations under the Uncommitted Credit Facility are guaranteed by the
Company and will be used for working capital and general corporate purposes and have a maturity date of April 13, 2022, at which time
Wayside UK must pay all outstanding principal of all outstanding loans plus all accrued and unpaid interest, and any interest, fees, costs
and expenses, if any. As of December 31, 2021, no borrowings were outstanding under the Uncommitted Credit Facility.
At December 31, 2021 and 2020, the Company had no borrowings outstanding under the Credit Facility. The Company incurred
$0.1 million of interest expense, related to the Credit Facility for each of the years ended December 31, 2021 and 2020.
We anticipate that our working capital needs will increase as we invest in the growth of our business. We believe that the funds
held in cash and cash equivalents and our unused borrowings under our Credit Facility will be sufficient to fund our working capital and
cash requirements for the next 12 months.
Foreign Exchange
The Company’s foreign business is subject to changes in demand or pricing resulting from fluctuations in currency exchange rates
or other factors. We are subject to fluctuations primarily in the Canadian Dollar, Euro Dollar and British Pound-to-U.S. Dollar exchange
rate.
Off-Balance Sheet Arrangements
As of December 31, 2021, we did not have any off-balance sheet arrangements.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Smaller reporting companies are not required to provide the information required by this item.
Item 8. Financial Statements and Supplementary Data
See Index to Consolidated Financial Statements at Item 15(a).
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures. As required by Rule 13a-15(b) under the Exchange Act, our management
carried out an evaluation of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures”, as such
term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report. This evaluation
was carried out under the supervision and with the participation of

Table of Contents
28
various members of our management, including our Company’s Chief Executive Officer (principal executive officer), Vice President and
Chief Financial Officer (principal financial officer) and Vice President and Chief Accounting Officer (principal accounting officer). Based
upon that evaluation, the Company’s Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer concluded that the
Company’s disclosure controls and procedures were effective, as of the end of the period covered by this report, to ensure that information
required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to the Company’s
management, including the Company’s Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer, as appropriate, to
allow timely decisions regarding required disclosure.
 
Management Report on Internal Control Over Financial Reporting. Our management is responsible for establishing and
maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Internal
control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer, Chief Financial Officer
and Chief Accounting Officer, and effected by the Board of Directors, management and other personnel, to provide reasonable assurance
regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with US
GAAP. Internal control over financial reporting includes maintaining records in reasonable detail that accurately and fairly reflect our
transactions and disposition of assets; providing reasonable assurance that transactions are recorded as necessary for preparation of our
financial statements in accordance with US GAAP; providing reasonable assurance that receipts and expenditures of the Company, are
made in accordance with authorizations of management and directors of the Company; and providing reasonable assurance that
unauthorized acquisition, use or disposition of Company assets that could have a material effect on our financial statements would be
prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting is not intended to
provide absolute assurance that a misstatement of our financial statements would be prevented or detected. In addition, projections of any
evaluation of effectiveness to future periods are subject to the risk that, owing to changes in conditions, controls may become inadequate, or
that the degree of compliance with policies or procedures may deteriorate.
Management, with the participation of our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer,
conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control —
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on
this evaluation, the Company’s Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer concluded that the
Company’s internal control over financial reporting was effective as of December 31, 2021.
The Company's independent registered public accounting firm, BDO USA, LLP, has audited the effectiveness of the Company's
internal control over financial reporting as of December 31, 2021, as stated in their report, which is included herein.
Item 9B. Other Information
None.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required hereunder, with the exception of the information relating to the Company’s Code of Ethical Conduct that
is presented in Part I under the heading “Available Information,” is incorporated by reference herein from our Definitive Proxy Statement
for the 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A not later than May 2, 2022 (the “Definitive Proxy
Statement”) under the sections captioned “Election of Directors” and “Corporate Governance.”

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29
Item 11. Executive Compensation
The information required hereunder is incorporated by reference herein from the Definitive Proxy Statement under the sections
captioned “Executives and Executive Compensation” and “Corporate Governance.”
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required hereunder is incorporated by reference herein from the Definitive Proxy Statement under the sections
captioned “Equity Compensation Plan Information — Securities Authorized for Issuance under Equity Compensation Plans” and “Security
Ownership of Certain Beneficial Owners and Management.”
Item 13. Certain Relationships and Related Party Transactions, and Director Independence
The information required hereunder is incorporated by reference herein from the Definitive Proxy Statement under the sections
captioned “Executives and Executive Compensation,” “Corporate Governance” and “Transactions with Related Persons.”
Item 14. Principal Accounting Fees and Services
The information required hereunder is incorporated by reference herein from the Definitive Proxy Statement under the section
captioned “Ratification of Appointment of Independent Registered Public Accounting Firm.”
PART IV
Item 15. Exhibits, Financial Statement Schedules
(a)
The following documents are filed as part of this Report:
1.
Consolidated Financial Statements (See Index to Consolidated Financial Statements on page F-1 of this report);
2.
Financial Statement Schedule:
Schedule II Valuation and Qualifying Accounts
All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require
submission of the schedule, or because the information required is included in the Consolidated Financial Statements or notes
thereto.
3.
Exhibits Required by Regulation S-K, Item 601:
Exhibit No.     
Description of Exhibit
3.1
Form of Amended and Restated Certificate of Incorporation of the Company. (1)
3.1(a)
Certificate of Amendment of Restated Certificate of Incorporation of the Company. (2)
3.2
Amended and Restated By-Laws of the Company. (15)
4.1
Specimen of Common Stock Certificate. (1)
4.3
Description of Securities. (16)

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30
Exhibit No.     
Description of Exhibit
10.1
Second Amended and Restated Revolving Credit Loan Agreement, dated November 15, 2017, by and among Wayside
Technology Group, Inc., Lifeboat Distribution, Inc., Techxtend, Inc., Programmer’s Paradise, Inc., and ISP International
Software Partners, Inc., as Co-Borrowers, and Citibank, N.A., as Lender. (6)
10.2
Second Amended and Restated Credit Loan Note, dated November 15, 2017, by and among Wayside Technology Group, Inc.,
Lifeboat Distribution, Inc., Techxtend, Inc., Programmer’s Paradise, Inc., and ISP International Software Partners, Inc., as Co-
Borrowers, and Citibank, N.A., as Lender. (6)
10.3
Second Amended and Restated Security Agreement, dated November 15, 2017, by and among Wayside Technology
Group, Inc., Lifeboat Distribution, Inc., Techxtend, Inc., Programmer’s Paradise, Inc., and ISP International Software
Partners, Inc., as Debtors, and Citibank, N.A., as Lender. (6)
10.4
Second Amended and Restated Pledge and Security Agreement, dated November 15, 2017, by and between Wayside
Technology Group, Inc., as Grantor, and Citibank, N.A., as Secured Party. (6)
10.5
First Amendment to Second Amended and Restated Revolving Credit Loan Agreement and Other Loan Documents, dated
August 31, 2020, by and among Wayside Technology Group, Inc., Climb Channel Solutions, Inc., f/k/a Lifeboat Distribution,
Inc., TechXtend, Inc., Programmer’s Paradise, Inc., ISP International Software Partners, Inc., and Interwork Technologies,
Inc., as Co-Borrowers, and Citibank, N.A., as Lender. (11)
10.6
First Allonge to Second Amended and Restated Revolving Credit Loan Note, dated August 31, 2020, by and among Wayside
Technology Group, Inc., Climb Channel Solutions, Inc., f/k/a Lifeboat Distribution, Inc., TechXtend, Inc., Programmer’s
Paradise, Inc., ISP International Software Partners, Inc., and Interwork Technologies Inc., as Co-Borrowers, and Citibank,
N.A., as Lender. (11)
10.7
Code of Ethics and Business Conduct. (7)
10.8
Employment agreement dated January 15, 2020 between the Company and Dale Foster. (8)
10.9
Employment agreement dated January 2, 2018 between the Company and Charles Bass. (9)
10.10
Employment agreement dated June 8, 2021 between the Company and Andrew Clark. (9)
10.11
Offer Letter, dated January 6, 2003, from the Company to Vito Legrottaglie. (4)
10.12
Form of Officer and Director Indemnification Agreement. (10)
10.13
2012 Stock-Based Compensation Plan. (5)
10.14
2021 Stock-Based Compensation Plan. (12)
10.28
Form of Non-Qualified Stock Option Agreement. (3)
21.1
Subsidiaries of the Registrant. (13)
23.1
Consent of BDO USA, LLP, an Independent Registered Public Accounting Firm. (13)
31.1
Certification pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, of Dale Foster, the Chief
Executive Officer of the Company. (14)

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31
Exhibit No.     
Description of Exhibit
31.2
Certification pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, of Andrew Clark, the Vice
President and Chief Financial Officer of the Company. (14)
31.3
Certification pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, of Matthew Sullivan, the
Vice President and Chief Accounting Officer of the Company. (14)
32.1
Certification pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Dale Foster, the Chief Executive Officer of the Company. (13)
32.2
Certification pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Andrew Clark, the Vice President and Chief Financial Officer
of the Company. (13)
32.3
Certification pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Matthew Sullivan, the Vice President and Chief Accounting
Officer of the Company. (13)
101
The following financial information from Wayside Technology Group, Inc.’s Annual Report on Form 10-K for the year ended
December 31, 2021, filed with the SEC on March 9, 2022, formatted in XBRL (Extensible Business Reporting Language)
includes: (1) Consolidated Balance Sheets, (2) Consolidated Statements of Earnings, (3) Consolidated Statements of
Comprehensive Income, (4) Consolidated Statements of Stockholders’ Equity, (5) Consolidated Statements of Cash Flows,
and (6) the Notes to the Consolidated Financial Statements.
104
Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its
XBRL tags are embedded within the Inline XBRL document.
(1)
Incorporated by reference to the exhibits of the same number to the Registrant’s Registration Statement on Form S-1 or amendments
thereto (File No. 333-92810) filed on May 30, 1995, July 7, 1995 and July 18, 1995.
(2)
Incorporated by reference to the exhibits of the same number to the Registrant’s Quarterly Report on Form 10-Q for the quarter
ended September 30, 2006 filed on November 3, 2006.
(3)
Incorporated by reference to exhibits of the same number filed with the Registrant’s Annual Report on Form 10-K for the year
ended December 31, 2007 filed on March 13, 2008.
(4)
Incorporated by reference to exhibits of the same number filed with the Registrant’s Quarterly Report on Form 10-Q for the quarter
ended March 31, 2007 filed on May 15, 2007.
(5)
Incorporated by reference to Exhibit A of the Registrant’s Definitive Annual Meeting Proxy Statement filed on April 24, 2012.
(6)
Incorporated by reference to the Registrant’s Form 8-K filed on November 20, 2017.
(7)
Incorporated by reference to the Registrant’s Form 8-K filed on December 8, 2017.
(8)
Incorporated by reference to the Registrant’s Form 8-K filed on January 21, 2020.
(9)
Incorporated by reference to Exhibit 10.2 and 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the Period Ended
March 31, 2020 filed May 8, 2020.
(10)
Incorporated by reference Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the Period Ended March 31, 2017
filed May 5, 2017.

Table of Contents
32
(11)
Incorporated by reference to the Registrant’s Form 8-K filed on September 2, 2020.
(12)
Incorporated by reference to Appendix A of the Registrant’s Definitive Annual Meeting Proxy Statement filed on April 16, 2021.
(13)
Furnished herewith.
(14)
Filed herewith.
(15)
Incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on August 6, 2020.
(16)
Incorporated by reference to Exhibit 4.3 to the Registrant’s Annual Report on Form 10-K filed on March 16, 2021.
(b)
The exhibits required by Item 601 of Regulation S-K are reflected above in Section (a) 3. of this Item.
(c)
The financial statement schedule is included as reflected in Section (a) 2. of this Item.

Table of Contents
33
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized, in Eatontown, New Jersey, on March 9, 2022.
WAYSIDE TECHNOLOGY GROUP, INC.
By:
/s/ Dale Foster
Dale Foster, Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the Registrant in the capacities and on the dates indicated:
Signature
Title
Date
/s/ Dale Foster
Chief Executive Officer and Director
March 9, 2022
Dale Foster
(Principal Executive Officer)
/s/ Andrew Clark
Vice President and Chief Financial Officer
March 9, 2022
Andrew Clark
(Principal Financial Officer)
/s/ Matthew Sullivan
Vice President and Chief Accounting Officer
March 9, 2022
Matthew Sullivan
(Principal Accounting Officer)
/s/ Jeffrey Geygan
Chairman of the Board of Directors
March 9, 2022
Jeffrey Geygan
/s/ John McCarthy
Director
March 9, 2022
John McCarthy
/s/ Andrew Bryant
Director
March 9, 2022
Andrew Bryant
/s/ Ross Crane
Director
March 9, 2022
Ross Crane
/s/ Gerri Gold
Director
March 9, 2022
Gerri Gold
/s/ Greg Scorziello
Director
March 9, 2022
Greg Scorziello

Table of Contents
F-1
Items 8 and 15(a)
Wayside Technology Group, Inc. and Subsidiaries
Index to Consolidated Financial Statements and Schedule
Page
Reports of Independent Registered Public Accounting Firm (BDO USA, LLP; Woodbridge, New Jersey; PCAOB ID#243)
F-2
Consolidated Balance Sheets as of December 31, 2021 and 2020
F-6
Consolidated Statements of Earnings for the years ended December 31, 2021 and 2020
F-7
Consolidated Statements of Comprehensive Income for the years ended December 31, 2021 and 2020
F-8
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2021 and 2020
F-9
Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020
F-10
Notes to Consolidated Financial Statements
F-11
Schedule II — Valuation and Qualifying Accounts
F-31

Table of Contents
F-2
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders
Wayside Technology Group, Inc.
Eatontown, New Jersey
Opinion on Internal Control over Financial Reporting
We have audited Wayside Technology Group, Inc. and Subsidiaries (the “Company”) internal control over financial reporting as of
December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of
Sponsoring Organizations of the Treadway Commission (the “COSO criteria”).  In our opinion, the Company maintained, in all material
respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”),
the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of earnings,
comprehensive income, stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2021, and the
related notes and schedule and our report dated March 9, 2022 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Item 9A, Controls and Procedures. Our
responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public
accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit of internal control over financial reporting in accordance with the standards of the PCAOB. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing
the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that
our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Table of Contents
F-3
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ BDO USA, LLP
Woodbridge, New Jersey
March 9, 2022

Table of Contents
F-4
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders
Wayside Technology Group, Inc.
Eatontown, New Jersey
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Wayside Technology Group, Inc. and Subsidiaries (the “Company”) as
of December 31, 2021 and 2020, the related consolidated statements of earnings, comprehensive income, stockholders’ equity, and cash
flows for each of the two years in the period ended December 31, 2021, and the related notes and schedule (collectively referred to as the
“consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the
financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two
years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”),
the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control –
Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and our
report dated March 9, 2022 expressed an unqualified opinion thereon.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on
the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or
fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles
used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that
was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material
to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication
of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by
communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to
which it relates.

Table of Contents
F-5
Goodwill Impairment Quantitative Assessment
At December 31, 2021, the Company’s consolidated goodwill balance was approximately $17.2 million, which is allocated between two
reporting units. As discussed in Note 2 to the consolidated financial statements, the Company tests goodwill for impairment at least
annually at the reporting unit level. The Company determines the fair value of the reporting unit using a combination of an income
approach, and a market approach. The determination of the fair value of the reporting units requires management to make significant
estimates and assumptions related to forecasts of future cash flows, revenue growth rate, and discount rates. These assumptions are affected
by expected future market and economic conditions.
We identified the goodwill impairment quantitative assessment as a critical audit matter. The principal considerations for our determination
were the significant assumptions management makes as part of the assessment to estimate the fair value of the reporting units. The income
approach requires significant management assumptions in projecting future cash flows, revenue growth rate, and selection of the discount
rates. Auditing management’s significant assumptions used in the goodwill impairment quantitative assessment involved especially
challenging auditor judgment due to the nature and extent of audit effort required to address these matters, including the involvement of
professionals with specialized skill or knowledge.
The primary procedures we performed to address this critical matter included:
●
Testing the design and operating effectiveness of controls related to management’s forecasting process, including controls over data,
inputs, and assumptions utilized to determine the fair value of the reporting units.
●
Evaluating the reasonableness of management’s assumptions in the calculation of fair value of reporting units, including the revenue
growth rate in the projected future cash flows by comparing to i) prior period forecasts, ii) historical operating performance, iii)
internal and external communications made by the Company, and iv) publicly available industry data of peer companies. 
●
Utilizing personnel with specialized knowledge and skill in valuation to assist in i) evaluating the appropriateness of the
methodologies and valuation models utilized by management to determine the fair value of the reporting units, and ii) evaluating the
reasonableness of the discount rate used in the income approach.
/s/ BDO USA, LLP
We have served as the Company's auditor since 2018.
Woodbridge, New Jersey
March 9, 2022

Table of Contents
F-6
Wayside Technology Group, Inc. and Subsidiaries
Consolidated Balance Sheets
(Amounts in thousands, except share and per share amounts)
December 31,
December 31,
    
2021
    
2020
    
ASSETS
Current assets:
Cash and cash equivalents
$
29,272
$
29,348
Accounts receivable, net of allowance for doubtful accounts of $881 and $892,
respectively
122,502
 
93,821
Inventory, net
2,022
 
4,936
Vendor prepayments and advances
661
1,235
Prepaid expenses and other current assets
4,871
 
3,837
Total current assets
159,328
 
133,177
Equipment and leasehold improvements, net
1,932
 
2,308
Goodwill
17,188
16,816
Other intangibles, net
9,950
10,625
Right-of-use assets, net
1,628
1,933
Accounts receivable-long-term, net
78
 
304
Other assets
459
 
257
Deferred income tax assets
189
 
113
Total assets
$
190,752
$
165,533
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses
$
134,271
$
116,692
Lease liability, current portion
475
490
Total current liabilities
134,746
 
117,182
Lease liability, net of current portion
1,810
2,167
Deferred income tax liabilities
1,780
1,467
Total liabilities
138,336
120,816
Commitments and contingencies
Stockholders’ equity:
Common stock, $.01 par value; 10,000,000 shares authorized; 5,284,500 shares issued:
4,424,672 and 4,361,997 shares outstanding, respectively
53
 
53
Additional paid-in capital
32,087
 
31,962
Treasury stock, at cost, 859,828 and 922,503 shares, respectively
(13,870)
 
(14,747)
Retained earnings
34,396
 
28,191
Accumulated other comprehensive loss
(250)
 
(742)
Total stockholders’ equity
52,416
 
44,717
Total liabilities and stockholders' equity
$
190,752
$
165,533
The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents
F-7
Wayside Technology Group, Inc. and Subsidiaries
Consolidated Statements of Earnings
(Amounts in thousands, except per share amounts)
 
Year ended December 31,
    
2021
    
2020
 
Net sales
$
282,582
$
251,568
Cost of sales
 
236,866
 
218,528
Gross profit
 
45,716
 
33,040
Selling, general, and administrative expenses
 
32,136
 
23,929
Legal and financial advisory expenses, net - unsolicited bid and related matters
—
1,586
Acquisition related costs
—
1,518
Amortization and depreciation expense
1,529
704
Income from operations
 
12,051
 
5,303
Other income:
Interest, net
 
359
 
121
Foreign currency transaction (loss) gain
(46)
796
Income before provision for income taxes
 
12,364
 
6,220
Provision for income taxes
 
3,166
 
1,746
Net income
$
9,198
$
4,474
Income per common share-Basic
$
2.09
$
1.01
Income per common share-Diluted
$
2.09
$
1.01
Weighted average common shares outstanding — Basic
 
4,272
 
4,288
Weighted average common shares outstanding — Diluted
 
4,272
 
4,288
Dividends paid per common share
$
0.68
$
0.68
The accompanying notes are an integral part of the consolidated financial statements.

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F-8
Wayside Technology Group, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(Amounts in thousands)
Year ended
December 31,
    
2021
    
2020
    
Net income
$
9,198
$
4,474
Other comprehensive income:
Foreign currency translation adjustments
 
492
 
388
Other comprehensive income
 
492
 
388
Comprehensive income
$
9,690
$
4,862
The accompanying notes are an integral part of the consolidated financial statements.

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F-9
Wayside Technology Group, Inc. and Subsidiaries
Consolidated Statements of Stockholders’ Equity
(Amounts in thousands, except share amounts)
Accumulated
 
Additional
Other
 
Common Stock
Paid-In
Treasury
Retained
Comprehensive
 
   
Shares
   Amount    
Capital
   
Shares
   Amount    Earnings    (Loss) Income    
Total
 
Balance at January 1, 2020
 
5,284,500
53
32,874  
778,807
(13,256)
26,715
(1,130)
45,256
Net income
—
—
—
—
—
4,474
—
4,474
Translation adjustment
—
—
—
—
—
—
388
388
Dividends paid
—
—
—
—
—
(2,998)
—
(2,998)
Share-based compensation expense
—
—
1,278
—
—
—
—
1,278
Restricted stock grants (net of forfeitures)
—
—
(2,190)
(129,483)
2,190
—
—
—
Treasury shares repurchased
—
—
—
273,179
(3,681)
—
—
(3,681)
Balance at December 31, 2020
 
5,284,500
53
31,962  
922,503
(14,747)
28,191
(742)
44,717
Net income
—
—
—
—
—
9,198
—
9,198
Translation adjustment
—
—
—
—
—
—
492
492
Dividends paid
—
—
—
—
—
(2,993)
—
(2,993)
Share-based compensation expense
—
—
1,546
—
—
—
—
1,546
Restricted stock grants (net of forfeitures)
—
—
(1,421)
(83,963)
1,421
—
—
—
Treasury shares repurchased
—
—
—
21,288
(544)
—
—
(544)
Balance at December 31, 2021
 
5,284,500
$
53
$
32,087  
859,828
$ (13,870)
$
34,396
$
(250)
$ 52,416
The accompanying notes are an integral part of the consolidated financial statements

Table of Contents
F-10
Wayside Technology Group, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Amounts in thousands)
Year ended
December 31,
    
2021
    
2020
    
Cash flows from operating activities
Net income
$
9,198
$
4,474
Adjustments to reconcile net income to net cash and cash equivalents provided by operating activities:
Depreciation and amortization expense
 
1,534
 
713
Provision for doubtful accounts
 
26
130
Deferred income tax expense
 
228
 
(170)
Share-based compensation expense
1,546
1,278
Amortization of discount on accounts receivable
(55)
(164)
Amortization of right-of-use assets
468
392
Change in fair value of contingent earn-out consideration
—
47
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable
 
(28,577)
 
26,727
Inventory
 
2,914
 
(1,997)
Prepaid expenses and other current assets
 
(1,004)
 
(739)
Vendor prepayments
574
(766)
Accounts payable and accrued expenses
 
18,616
 
8,678
Lease liability, net
(534)
(448)
Other assets and liabilities
 
(222)
 
(186)
Net cash and cash equivalents provided by operating activities
 
4,712
 
37,969
Cash flows from investing activities
Purchase of equipment and leasehold improvements
 
(258)
 
(23)
Payment for acquisitions, net of cash acquired
—
(16,782)
Net cash and cash equivalents used in investing activities
 
(258)
 
(16,805)
Cash flows from financing activities
Purchase of treasury stock
 
(544)
 
(3,681)
Borrowings under revolving credit facility
—
6,800
Repayments of borrowings under revolving credit facility
—
(6,800)
Dividends paid
 
(2,993)
 
(2,998)
Contingent consideration
(862)
—
Payments of deferred financing costs
—
(61)
Net cash and cash equivalents used in financing activities
 
(4,399)
 
(6,740)
Effect of foreign exchange rate on cash and cash equivalents
 
(131)
 
(60)
Net (decrease) increase in cash and cash equivalents
 
(76)
 
14,364
Cash and cash equivalents at beginning of period
 
29,348
 
14,984
Cash and cash equivalents at end of period
$
29,272
$
29,348
Supplementary disclosure of cash flow information:
Income taxes paid
$
2,700
$
2,425
Interest paid
$
43
$
49
The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents
F-11
Wayside Technology Group, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Amounts in tables in thousands, except share and per share amounts)
Note 1.  Description of Business
Wayside Technology Group, Inc. and Subsidiaries (the “Company”), was incorporated in Delaware in 1982.  The Company
distributes technology products developed by others to resellers who in turn sell to end customers worldwide. The Company also is a cloud
solutions provider and value-added reseller of software, hardware and services to customers worldwide. The Company also operates in
Canada, the United Kingdom and Europe. The Company offers an extensive line of products from leading software vendors and tools for
virtualization/cloud computing, security, networking, storage & infrastructure management, application lifecycle management and other
technically sophisticated domains as well as computer hardware.
The Company is organized into two reportable operating segments. The “Distribution” segment distributes technical software to
corporate resellers, value added resellers (VARs), consultants and systems integrators worldwide under the name “Climb Channel
Solutions”. The “Solutions” segment is a cloud solutions provider and value-added reseller of software, hardware and services to customers
worldwide under the names “TechXtend” and “Grey Matter”.
Note 2.  Summary of Significant Accounting Policies
Principles of Consolidation and Operations
The consolidated financial statements include the accounts of Wayside Technology Group, Inc. and its wholly owned subsidiaries.
All intercompany transactions and balances have been eliminated.
Business Combinations
The Company accounts for business combinations using the acquisition method of accounting, which allocates the fair value of the
purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess
of the purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. When determining the
fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions. The Company may utilize
third-party valuation specialists to assist the Company in the allocation. Initial purchase price allocations are subject to revision within the
measurement period, not to exceed one year from the date of acquisition. Acquisition-related expenses and transaction costs associated with
business combinations are expensed as incurred.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United
States of America (“US GAAP”) requires management to make extensive use of certain estimates and assumptions which affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting periods. The significant areas of estimation include but are not limited to
accounting for allowance for doubtful accounts, sales returns, allocation of revenue in multiple deliverable arrangements, principal vs. agent
considerations, discount rates applicable to long term receivables, inventory obsolescence, income taxes, depreciation, amortization of
intangible assets, contingencies and stock-based compensation. Actual results could differ from those estimates.
Net Income Per Common Share
Our basic and diluted earnings per share are computed using the two-class method. The two-class method is an earnings allocation
method that determines net income per share for each class of common stock and participating securities according to their participation
rights in dividends and undistributed earnings or losses. Non-vested restricted

Table of Contents
F-12
stock awards that include non-forfeitable rights to dividends are considered participating securities. Per share amounts are computed by
dividing net income available to common shareholders by the weighted average shares outstanding during each period. Diluted and basic
earnings per share are the same because the restricted shares are the only potentially dilutive security.
A reconciliation of the numerators and denominators of the basic and diluted per share computations follows:
Year ended December 31,
    
2021
    
2020
Numerator:
Net income
$
9,198
$
4,474
Less distributed and undistributed income allocated to participating securities
269
130
Net income attributable to common shareholders
8,929
4,344
Denominator:
 
 
Weighted average common shares (Basic)
4,272
 
4,288
 
 
Weighted average common shares including assumed conversions (Diluted)
4,272
 
4,288
Basic net income per share
$
2.09
$
1.01
Diluted net income per share
$
2.09
$
1.01
Cash Equivalents
The Company considers all liquid short-term investments with maturities of 90 days or less when purchased to be cash
equivalents.
Accounts Receivable
Accounts receivable principally represents amounts collectible from our customers. The Company performs ongoing credit
evaluations of its customers but generally does not require collateral to support any outstanding obligation. From time to time, we sell
accounts receivable to a financial institution on a non-recourse basis for cash, less a discount. The Company has no significant retained
interests or servicing liabilities related to the accounts receivable sold. Proceeds from the sale of receivables approximated their discounted
book value and were included in operating cash flows on the Consolidated Statements of Cash Flows.
Allowances for Accounts Receivable
We provide an allowance for doubtful accounts related to accounts receivable for estimated losses resulting from the inability of
our customers to make required payments. We take into consideration the overall quality and aging of the receivable portfolio along with
specifically identified customer risks. If actual customer payment performance were to deteriorate to an extent not expected, additional
allowances may be required. At the time of sale, we also record an estimate for sales returns based on historical experience, which is
included in accounts payable and accrued expenses on the Consolidated Balance Sheets. If actual sales returns are greater than estimated by
management, additional expense may be incurred.

Table of Contents
F-13
Foreign Currency Translation
Assets and liabilities of the Company’s foreign subsidiaries have been translated using the end of the reporting period exchange
rates, and related revenues and expenses have been translated at average rates of exchange in effect during the period. Cumulative
translation adjustments have been classified within accumulated other comprehensive loss, which is a separate component of stockholders’
equity in accordance FASB ASC Topic No. 220, “Comprehensive Income”. Foreign currency transaction gains and losses are recorded as
income or expenses as amounts are settled.
For foreign currency remeasurement from each local currency into the appropriate functional currency, monetary assets and
liabilities are remeasured to functional currencies using current exchange rates in effect at the balance sheet date. Gains or losses from these
remeasurements have been included in the Company's Consolidated Statements of Earnings. Non-monetary assets and liabilities are
recorded at historical exchange rates.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations in credit risk consist of cash and cash equivalents.
The Company’s cash and cash equivalents, at times, may exceed federally insured limits. The Company’s cash and cash
equivalents are deposited primarily in banking institutions with global operations. The Company has not experienced any losses in such
accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents.
Financial Instruments
The carrying amounts of financial instruments, including cash and cash equivalents, accounts receivable and accounts payable
approximated fair value as of December 31, 2021 and 2020, because of the relative short maturity of these instruments. The Company’s
accounts receivable-long-term is discounted to its present value at prevailing market rates at the time of sale which, approximates fair value
as of December 31, 2021 and 2020.
Inventory
Inventory, consisting primarily of finished products held for resale, is stated at the lower of cost or net realizable value.
Vendor Prepayments and Advances
Vendor prepayments represents advance payments made to vendors to be applied against future purchases. Any amounts not
expected to be utilized to apply against purchases within one year are reclassified to other long-term assets.
Equipment and Leasehold Improvements
Equipment and leasehold improvements are stated at cost or fair value, if purchased as part of a business combination. Equipment
depreciation is calculated using the straight-line method over three to five years. Leasehold improvements are amortized using the straight-
line method over the estimated useful lives of the assets or the related lease terms, whichever is shorter.
Software Development Costs
The Company capitalizes certain internal and external costs incurred to acquire or create internal-use software. Capitalized
software costs are amortized on a straight-line basis over the estimated useful life of the software, which is generally four to seven years. At
December 31, 2021 and 2020, the Company had unamortized software development

Table of Contents
F-14
costs of $0.7 million and $0.8 million, respectively, which are included in "Equipment and leasehold improvements" in the Company's
consolidated balance sheets.
Accounts Receivable-Long-Term
Accounts receivable-long-term result from product sales with extended payment terms that are discounted to their present values at
the prevailing market rates at the time of sale. In subsequent periods, the accounts receivable is increased to the amounts due and payable
by the customers through the accretion of interest income on the unpaid accounts receivable due in future years. The amounts under these
long-term accounts receivable due within one year are reclassified to the current portion of accounts receivable.
Goodwill
We test goodwill for impairment on an annual basis and between annual tests if an event occurs, or circumstances change, that
would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company performs an evaluation of
goodwill, utilizing either a qualitative or quantitative impairment test. The annual test for impairment is conducted as of October 1. The
Company’s reporting units included in the assessment of potential goodwill impairment are the same as its operating segments. Goodwill is
not amortized but is subject to periodic testing for impairment at the reporting unit level.
In a qualitative assessment, we assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of
more than 50 percent) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If, after assessing the
totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its
carrying amount, then the quantitative goodwill impairment test is unnecessary.
If, after assessing the totality of events or circumstances, we determine that it is more likely than not that the fair value of a
reporting unit is less than its carrying amount, then we perform the quantitative goodwill impairment test. We may also elect the
unconditional option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the
quantitative goodwill impairment test.
In the quantitative impairment test, we compare the fair value of a reporting unit with its carrying amount, including goodwill. If
the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. Conversely, if the
carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited
to the total amount of goodwill allocated to that reporting unit.
Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions,
including net sales growth rates, gross profit margins, operating margins, discount rates and future market conditions, among others. Any
changes in the judgments, estimates or assumptions used could produce significantly different results.
Intangible Assets
Intangible assets with determinable lives are amortized on a straight-line basis over their respective estimated useful lives, which is
determined based on their expected period of benefit. Intangible assets are reviewed for impairment when events or changes in
circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an
estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. If the carrying amount of an asset
exceeds its estimated future undiscounted cash flows, an impairment loss is recorded for the excess of the asset's carrying amount over its
fair value. In addition, each quarter, the Company evaluates whether events and circumstances warrant a revision to the remaining estimated
useful life of each of these intangible assets. If the Company were to determine that a change to the remaining estimated useful life of an
intangible asset was necessary, then the remaining carrying amount of the intangible asset would be amortized prospectively over that
revised remaining useful life.

Table of Contents
F-15
Comprehensive Income
Comprehensive income consists of net income for the year and the impact of unrealized foreign currency translation adjustments.
The foreign currency translation adjustments are not currently adjusted for income taxes as they relate to permanent investments in
international subsidiaries.
Revenue Recognition
The Company’s revenues primarily result from the sale of various technology products and services, including third-party
products, third-party software and third-party maintenance, software support and services. The Company recognizes revenue as control of
the third-party products and third-party software is transferred to customers, which generally happens at the point of shipment or fulfilment
and at the point that our customers and vendors accept the terms and conditions of the arrangement for third-party maintenance, software
support and services.
The Company has contracts with certain customers where the Company’s performance obligation is to arrange for the products or
services to be provided by another party. In these arrangements, as the Company assumes an agency relationship in the transaction, revenue
is recognized in the amount of the net fee associated with serving as an agent. These arrangements primarily relate to third party
maintenance, cloud services and certain security software whose intended functionality is dependent on third party maintenance.
The Company allows its customers to return product for exchange or credit subject to certain limitations. A liability is recorded at
the time of sale for estimated product returns based upon historical experience and an asset is recognized for the amount expected to be
recorded upon product return. The Company also provides rebates and other discounts to certain customers which are considered variable
consideration. A provision for customer rebates and other discounts is recorded as a reduction of revenue at the time of sale based on an
evaluation of the contract terms and historical experience.
The Company considers shipping and handling activities as costs to fulfill the sales of products. Shipping revenue is included in
net sales when control of the product is transferred to the customer, and the related shipping and handling costs are included in cost of sales.
Taxes imposed by governmental authorities on the Company’s revenue producing activities with customers, such as sales taxes and value
added taxes, are excluded from net sales.
The Company disaggregates its operating revenue by segment, geography and timing of revenue recognition, which the Company
believes provides a meaningful depiction of the nature of its revenue. For additional information, see Note 13 (Industry, Segment and
Geographic Information).
Hardware and software products sold by the Company are generally delivered via shipment from the Company’s facilities, drop
shipment directly from the vendor, or by electronic delivery of keys for software products. The majority of the Company’s business
involves shipments directly from its vendors to its customers, in these transactions, the Company is generally responsible for negotiating
price both with the vendor and customer, payment to the vendor, establishing payment terms with the customer, product returns, and has
risk of loss if the customer does not make payment. As the principal with the customer, the Company recognizes revenue upon receiving
notification from the vendor that the product was shipped. Control of software products is deemed to have passed to the customer when
they acquire the right to use or copy the software under license as substantially all product functionality is available to the customer at the
time of sale.
The Company performs an analysis of the number of days of sales in-transit to customers at the end of each reporting period based
on an analysis of commercial delivery terms that include drop-shipment arrangements. This analysis is the basis upon which the Company
estimates the amount of net sales in-transit at the end of the period and adjusts revenue and the related costs to reflect only what has been
delivered to the customer. Changes in delivery patterns may result in a different number of business days estimated to make this adjustment.
The Company also performs a weighted average analysis of the estimated number of days between order fulfillment and beginning of the
renewal term for term licenses recorded on a gross basis, and a deferral estimate is recorded for term license renewals fulfilled prior to
commencement date.

Table of Contents
F-16
Generally, software products are sold with accompanying third-party delivered software assurance, which is a product that allows
customers to upgrade, at no additional cost, to the latest technology if new capabilities are introduced during the period that the software
assurance is in effect. The Company evaluates whether the software assurance is a separate performance obligation by assessing if the third-
party delivered software assurance is critical or essential to the core functionality of the software itself. This involves considering if the
software provides its original intended functionality to the customer without the updates, if the customer would ascribe a higher value to the
upgrades versus the up-front deliverable, if the customer would expect frequent intelligence updates to the software (such as updates that
maintain the original functionality), and if the customer chooses to not delay or always install upgrades. If the Company determines that the
accompanying third-party delivered software assurance is critical or essential to the core functionality of the software license, the software
license and the accompanying third-party delivered software assurance are recognized as a single performance obligation. The value of the
product is primarily the accompanying support delivered by a third party and therefore the Company is acting as an agent in these
transactions and recognizes them on a net basis at the point the associated software license is delivered to the customer. The Company sells
cloud computing solutions that utilize third-party vendors to enable customers to access data center functionality in a cloud-based solution,
including storage, computing and networking and access to software in the cloud that enhances office productivity, provides security or
assists in collaboration. The Company recognizes revenue for cloud computing solutions for arrangements with one-time invoicing to the
customer at the time of invoice on a net basis as the Company is acting as an agent in the transaction. For monthly subscription-based
arrangements, the Company is acting as an agent in the transaction and recognizes revenue as it invoices the customer for its monthly usage
on a net basis. For software licenses where the accompanying third-party delivered software assurance is not critical or essential to the core
functionality, the software assurance is recognized as a separate performance obligation, with the associated revenue recognized on a net
basis at the point the related software license is delivered to the customer.
The Company also sells some of its products and services as part of bundled contract arrangements containing multiple
deliverables, which may include a combination of products and services. For each deliverable that represents a distinct performance
obligation, total arrangement consideration is allocated based upon the standalone selling prices (“SSP”) of each performance obligation.
SSP is determined based on the price at which the performance obligation is sold separately. If the standalone selling price is not
observable through established standard prices, we use judgement and estimate the standalone selling price considering available
information such as market pricing and pricing related to similar products.
Freight
The Company records freight billed to its customers as net sales and the related freight costs as cost of sales when the underlying
product revenue is recognized. For freight not billed to its customers, the Company records the freight costs as cost of sales. The
Company’s typical shipping terms result in shipping being performed before the customer obtains control of the product. The Company
considers shipping to be a fulfillment activity and not a separate performance obligation.
Commissions
The Company pays commissions and related payroll taxes to sales personnel when customers are invoiced. These costs are
recorded as selling general and administrative expenses in the period earned as all our performance obligations are complete within a short
window of processing the order.
Stock-Based Compensation
The Company has stockholder-approved stock incentive plans for employees and directors. Stock-based compensation is
recognized based on the grant date fair value and is recognized as expense on a straight-line basis over the requisite service period.

Table of Contents
F-17
Operating Segments
Operating segments are defined as components of an enterprise for which separate financial information is available that is
evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The
Company's operations are classified into two reportable business segments: Distribution and Solutions. For additional information, see Note
13 (Industry, Segment and Geographic Information).
Treasury Stock
Treasury stock is accounted for at cost. Shares repurchased by the Company are held in treasury for general corporate purposes,
including issuances under equity incentive plans. The reissuance of shares from treasury stock is based on the weighted average purchase
price of the shares.
Interest, net
Interest, net consists primarily of income from the amortization of the discount on accounts receivable long term, net of interest
expense on the Company’s credit facility.
Income Taxes
The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and
liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using
enacted tax rates and laws that will be in effect when the differences are expected to reverse. This method also requires a valuation
allowance against the net deferred tax asset if, based on the weighted available evidence, it is more likely than not that some or all the
deferred tax assets will not be realized. The Company’s policy is to recognize interest and penalties related to uncertain tax positions in
income tax expense when assessed. The Company accounts for uncertainties in accordance with FASB ASC 740 “Income Taxes”. This
standard clarified the accounting for uncertainties in income taxes. The standard prescribes criteria for recognition and measurement of tax
positions. It also provides guidance on derecognition, classification, interest and penalties, and disclosures related to income taxes
associated with uncertain tax positions. The Company classifies all deferred tax asset or liabilities as non-current on the balance sheet.
Foreign Exchange
The Company’s foreign currency exposure relates primarily to international transactions where the currency collected from
customers can be different from the currency used to purchase the product. In cases where the Company is not able to create a natural hedge
by maintaining offsetting asset and liability amounts in the same currency, it may enter into foreign exchange contracts, typically in the
form of forward purchase agreements, to facilitate the hedging of foreign currency exposures to mitigate the impact of changes in foreign
currency exchange rates. These contracts generally have terms of no more than two months. The Company does not apply hedge accounting
to these contracts and therefore the changes in fair value are recorded in earnings. The Company does not enter into foreign exchange
contracts for trading purposes and the risk of loss on a foreign exchange contract is the risk of nonperformance by the counterparties, which
the Company minimizes by limiting its counterparties to major financial institutions. The fair value of forward purchase contracts at
December 31, 2021 was not material to the Consolidated Financial Statements.
Recently Issued Accounting Pronouncements
In June 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments - Credit Losses (Topic 326)”
("ASU 2016-13"). ASU 2016-13 revises the methodology for measuring credit losses on financial instruments and the timing of when such
losses are recorded. Originally, ASU 2016-13 was effective for fiscal years, and for interim periods within those fiscal years, beginning
after December 15, 2019, with early adoption permitted. In November 2019, FASB issued ASU 2019-10, “Financial Instruments – Credit
Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842).”  This ASU defers the effective date of ASU 2016-13
for public companies

Table of Contents
F-18
that are considered smaller reporting companies as defined by the SEC to fiscal years beginning after December 15, 2022, including interim
periods within those fiscal years. The Company is planning to adopt this standard in the first quarter of fiscal 2023. The Company is
currently evaluating the potential effects of adopting the provisions of ASU No. 2016-13 on its Consolidated Financial Statements,
particularly its recognition of allowances for accounts receivable.
3.  Acquisitions
Acquisition of Interwork Technologies
On April 30, 2020, the Company completed the purchase of Interwork Technologies Inc., a Delaware corporation and Interwork
Technologies Inc., a corporation incorporated under the laws of the Province of Ontario, Canada (collectively, “Interwork”) for an aggregate
purchase price of $5 million Canadian dollar (equivalent to $3.6 million USD), subject to certain working capital adjustments, paid at
closing plus a potential post-closing $1.1 million Canadian dollars (equivalent to $0.8 million USD) earn-out. The earn-out liability was
paid for approximately $0.9 million during the year ended December 31, 2021. The purchase price allocation is final, with no measurement
period adjustments made to the account balances recorded at the acquisition date.
The impact of the acquisition’s final purchase price allocations on the Company’s Consolidated Balance Sheet and the acquisition
date fair value of the total consideration transferred were as follows:
(in thousands)
Cash
$
1,009
Trade accounts receivable
9,534
Other current assets
628
Intangible assets
Vendor relationships (14-year weighted average useful life)
3,797
Non-compete (1-year useful life)
8
Goodwill
3,857
Other assets
117
Accounts payable and other current liabilities
(15,051)
Deferred income tax liabilities
(389)
Taxes payable
(600)
Net assets
$
2,910
(in thousands)
Supplementary information:
Cash paid to sellers
$
2,150
Contingent earn-out
760
Total purchase consideration
$
2,910
Cash paid to sellers
2,150
Cash acquired in acquisition
(1,009)
Net cash paid for acquisition
$
1,141

Table of Contents
F-19
Acquisition of CDF Group Limited
On November 6, 2020, the Company entered into a Share Purchase Agreement and purchased the entire share capital of CDF
Group Limited (“CDF”) for an aggregate purchase price of approximately £13.3 million (equivalent to approximately $17.4 million USD),
subject to certain working capital and other adjustments. The purchase price allocation is final, with no measurement period adjustments
made to the account balances recorded at the acquisition date.
The impact of the acquisition’s final purchase price allocations on the Company’s Consolidated Balance Sheet and the acquisition
date fair value of the total consideration transferred were as follows:
(in thousands)
Cash
$
8,463
Trade accounts receivable
8,093
Other current assets
260
Equipment and leasehold improvements, net
1,367
Intangible assets
Customer relationships (13-year useful life)
6,357
Trademarks (15-year useful life)
504
Non-compete (1-year useful life)
42
Goodwill
12,774
Other assets
375
Accounts payable and other current liabilities
(12,364)
Deferred income tax liabilities
(1,461)
Other liabilities
(306)
Net assets
$
24,104
(in thousands)
Supplementary information:
Cash paid to sellers
$
24,104
Cash acquired in acquisition
(8,463)
Net cash paid for acquisition
$
15,641
There were no acquisition related costs incurred during the year ended December 31, 2021. The Company incurred acquisition
related costs of approximately $1.5 million during the year ended December 31, 2020 in conjunction with the acquisitions of Interwork and
CDF, which are reflected in the accompanying Consolidated Statements of Earnings.

Table of Contents
F-20
4.  Goodwill and Other Intangible Assets
Goodwill represents the premium paid over the fair value of the net tangible and intangible assets that are individually identified
and separately recognized in business combinations. The following table summarizes the changes in the carrying amount of goodwill for the
years ended December 31, 2021 and 2020.
Balance at January 1, 2020
$
—
Goodwill acquired
16,631
Translation adjustments
185
Balance December 31, 2020
$
16,816
Translation adjustments
372
Balance December 31, 2021
$
17,188
Information related to the Company’s other intangibles, net is as follows:
As of December 31, 2021
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Customer and vendor relationships
$
10,550
$
1,079
$
9,471
Trade name
519
40
479
Non-compete
52
52
—
Total
$
11,121
$
1,171
$
9,950
As of December 31, 2020
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Customer and vendor relationships
$
10,361
$
272
$
10,089
Trade name
504
5
499
Non-compete
50
13
37
Total
$
10,915
$
290
$
10,625
Customer relationships are amortized over thirteen years. Vendor relationships are amortized between eleven and fifteen years.
Trade name is amortized over fifteen years. Non-compete is amortized over one year.
The Company recognized total amortization expense for other intangibles, net of $0.9 million and $0.3 million during the years
ended December 31, 2021 and 2020, respectively.
Estimated future amortization expense of the Company’s other intangibles, net as of December 31, 2021 is as follows:
2022
    $
819
2023
 
819
2024
 
819
2025
 
819
2026
 
819
Thereafter
 
5,855
Total
$
9,950

Table of Contents
F-21
5.  Right-of-use Asset and Lease Liability
The Company has entered into operating leases for office and warehouse facilities, which have terms at lease commencement that
range from 3 years to 11 years. The Company determines if an arrangement is a lease at inception. Leases with an initial term of 12 months
or less are not recorded on the Consolidated Balance Sheets and lease expense for these leases is recognized on a straight-line basis over the
lease term.
Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the
obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at
commencement date of the lease based on the present value of the lease payments over the lease term. As our leases do not provide a readily
determinable implicit rate, we use an incremental borrowing rate based on the information available at commencement date, including lease
term, in determining the present value of future payments. The operating lease asset also includes any lease payments made and excludes
lease incentives. Operating lease expense is recognized on a straight-line basis over the lease term and included in selling, general and
administrative expenses.
Information related to the Company’s right-of-use assets and related lease liabilities were as follows:
Year ended
December 31,
2021
2020
Cash paid for operating lease liabilities
$
598
$
503
Right-of-use assets obtained in exchange for new operating lease obligations (1)
$
163
$
537
Weighted-average remaining lease term
5.1 years
6.1 years
Weighted-average discount rate
3.5%
3.5%
(1) During the year ended December 31, 2020, includes $0.5 million recognized through acquisitions.
Maturities of lease liabilities as of December 31, 2021 were as follows:
2022
    $
560
2023
 
598
2024
 
544
2025
 
554
2026
 
551
Thereafter
 
125
2,932
Less: imputed interest
(647)
Total lease liabilities
$
2,285
Lease liabilities, current portion
475
Lease liabilities, net of current portion
1,810
Total lease liabilities
$
2,285

Table of Contents
F-22
6.  Balance Sheet Detail
Equipment and leasehold improvements, net consist of the following:
    
December 31,
December 31,
2021
    
2020
Equipment
$
2,627
$
2,482
Capitalized software
816
777
Leasehold improvements
 
1,762
 
1,760
 
5,205
 
5,019
Less accumulated depreciation and amortization
 
(3,273)
 
(2,711)
$
1,932
$
2,308
Depreciation expense relating to equipment and leasehold improvements, net was $0.5 million and $0.4 million during the years
ended December 31, 2021 and 2020, respectively. Amortization expense relating to capitalized software was $0.1 million and less than
$0.1 million during the years ended December 31, 2021 and 2020.
Accounts receivable – long term, net consist of the following:
December 31,
December 31,
2021
    
2020
    
Total amount due from customer
$
484
$
1,853
Less: unamortized discount
 
(8)
 
(49)
Less: current portion included in accounts receivable
 
(398)
 
(1,500)
$
78
$
304
Accounts payable and accrued expenses consist of the following:
    
December 31,
December 31,
2021
    
2020
    
Trade accounts payable
$
125,908
$
107,045
Accrued expenses
 
8,363
 
9,647
$
134,271
$
116,692
Accumulated other comprehensive loss consists of the following:
 
December 31,
December 31,
    
2021
    
2020
Foreign currency translation adjustments
$
492
$
388
$
492
$
388
7.  Income Taxes
Deferred tax attributes resulting from differences between the tax basis of assets and liabilities and the reported amounts in the
Consolidated Balance Sheets are as follows:

Table of Contents
F-23
December 31,
December 31,
    
2021
    
2020
 
Deferred tax assets:
Accruals and reserves
$
501
$
483
Deferred rent credit
163
175
Depreciation and amortization
24
7
Total deferred tax assets
688
665
Deferred tax liabilities:
Accruals and reserves
(67)
(9)
Depreciation and amortization
(2,212)
 
(2,010)
Total deferred tax liabilities
(2,279)
(2,019)
Net deferred tax (liabilities) asset
$
(1,591)
$
(1,354)
The provision for income taxes is as follows:
Year ended December 31,  
    
2021
    
2020
 
Current:
Federal
$
1,692
$
1,339
State
 
572
 
263
Foreign
 
674
 
314
 
2,938
 
1,916
Deferred:
Federal
 
(45)
 
(134)
State
(12)
(28)
Foreign
 
285
 
(8)
 
228
 
(170)
$
3,166
$
1,746
Effective Tax Rate
 
25.6 %   
28.1 %
The reasons for the difference between total tax expense and the amount computed by applying the U.S. statutory federal income
tax rate to income before income taxes are as follows:
Year ended December 31,  
    
2021
    
2020
 
Statutory rate applied to pretax income
$
2,596
$
1,309
State income taxes, net of federal income tax benefit
 
442
 
182
Adjustment for foreign rate change
353
—
Other permanent items
19
19
Acquisition related costs
—
319
Dividends
(17)
(19)
Foreign income taxes over U.S. statutory rate
 
(18)
 
(1)
GILTI, net of foreign tax credits
(38)
—
Stock compensation
(135)
(59)
Other items
 
(36)
 
(4)
Income tax expense
$
3,166
$
1,746
The Company has analyzed filing positions in all the federal and state jurisdictions where it is required to file income tax returns,
as well as all open tax years in these jurisdictions. The Company has identified its federal consolidated tax return, its state tax return in New
Jersey, its Canadian tax return and its tax return in the United Kingdom as major tax jurisdictions. As of December 31, 2021, the
Company’s 2018 through 2020 Federal tax returns remain open for

Table of Contents
F-24
examination. The Company’s New Jersey and Canadian tax returns are open for examination for the years 2017 through 2020. The
Company’s tax return in the United Kingdom is open for examination for the years 2019 and 2020. The Company’s policy is to recognize
interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. The Company believes that it has
appropriate support for the income tax positions it takes and expects to take on its tax returns, and that its accruals for tax liabilities are
adequate for all open years based on an assessment of many factors including experience and interpretations of tax law applied to the facts
of each matter.
For financial reporting purposes, income before income taxes includes the following components:
Year ended December 31,
 
    
2021
    
2020
 
United States
$
9,355
$
4,767
Foreign
 
3,009
 
1,453
$
12,364
$
6,220
The Company has approximately $7.4 million of undistributed earnings in Canada and $2.2 million of undistributed earnings in
the United Kingdom, which it continues to reinvest indefinitely, and therefore no withholding taxes related to its repatriation has been
recorded.
The following table summarizes the activity related to the Company’s unrecognized tax benefits as of December 31, 2021 and
2020:
2021
    
2020
Balance as of January 1
$
-
$
49
Additions related to prior period tax positions
 
-
-
Reductions related to settlements with tax authorities
 
-
(49)
Balance as of December 31
$
-
$
-
During the years ended December 31, 2021 and 2020, the Company incurred interest and penalties of zero and less than $0.1
million, respectively, related to these uncertain tax benefits.
8.  Credit Facility
On November 15, 2017, the Company entered into a $20 million revolving credit facility (the “Credit Facility”) with Citibank,
N.A. (“Citibank”) pursuant to a Second Amended and Restated Revolving Credit Loan Agreement (the “Loan Agreement”), Second
Amended and Restated Revolving Credit Loan Note (the “Note”), Second Amended and Restated Security Agreement and Second
Amended and Restated Pledge and Security Agreement. On August 31, 2020, the Company entered into an amendment to the Credit
Facility (the “Amended Credit Facility”) pursuant to a First Amendment to Second Amended and Restated Revolving Credit Loan
Agreement and Other Loan Documents (collectively, the “Amended Loan Agreement”) and First Allonge to Second Amended and Restated
Revolving Credit Loan Note (the “Amended Note”).
The Amended Credit Facility, which will continue to be used for working capital and general corporate purposes, matures on June
30, 2023, at which time the Company must pay all outstanding principal of all outstanding loans plus all accrued and unpaid interest, and
any, fees, costs and expenses. In addition, the Company will pay regular monthly payments of all accrued and unpaid interest. The interest
rate for any borrowings under the Amended Credit Facility is subject to change from time to time based on the changes in the LIBOR Rate,
as defined in the Amended Loan Agreement,  with the LIBOR Rate not to be less than 0.75 percentage points. Interest on the unpaid
principal balance of the Amended Note will be calculated using a rate of 1.75 percentage points over the LIBOR Rate, with the interest rate
being 2.50% at December 31, 2021. If the LIBOR Rate becomes unavailable during the term of the Amended Credit Facility, interest will
be based upon the Benchmark Replacement (as defined in the Amended Loan Agreement) selected by Citibank after notifying the
Company. The Amended Credit Facility is secured by the assets of the Company.

Table of Contents
F-25
At December 31, 2021 and 2020, the Company had no borrowings outstanding under the Credit Facility.  The Company incurred
$0.1 million of interest expense, related to the Credit Facility during the years ended December 31, 2021 and 2020, respectively.
On April 13, 2021, Wayside Technology UK Holdings Limited (“Wayside UK”), a wholly-owned subsidiary of the Company,
entered into an uncommitted short term credit facility of £8 million (“Uncommitted Credit Facility”) with Citibank N.A., London Branch
(“Citibank London”) pursuant to certain terms and conditions. Obligations under the Uncommitted Credit Facility are guaranteed by the
Company and will be used for working capital and general corporate purposes and have a maturity date of April 13, 2022, at which time
Wayside UK must pay all outstanding principal of all outstanding loans plus all accrued and unpaid interest, and any interest, fees, costs
and expenses, if any.
Interest on the unpaid principal balance of the Uncommitted Credit Facility will be calculated using a rate of 1.85 percentage
points over the Daily Rate, as defined in the Uncommitted Credit Facility. Amounts borrowed under the Uncommitted Credit Facility will
be guaranteed by the Company.   The Uncommitted Credit Facility may be cancelled at any time by Citibank London.  Citibank London
has the sole discretion to accept or reject any requested utilization of the Uncommitted Credit Facilitation.
At December 31, 2021, Wayside UK had no borrowings outstanding under the Uncommitted Credit Facility.
9.  Stockholders’ Equity and Stock-Based Compensation
The 2021 Omnibus Incentive Plan (the “2021 Plan”) authorizes the grant of Stock Options, Stock Units, Stock Appreciation
Rights, Restricted Stock, Deferred Stock, Stock Bonuses and other equity-based awards. The 2021 Plan was approved by the Company’s
stockholders at the 2021 Annual Meeting in June 2021. The total number of shares of the Company’s common stock, par value $0.01 per
share (“Common Stock”) initially available for award under the 2021 Plan was 500,000 shares. As of December 31, 2021, the number of
shares of Common Stock available for future award grants to employees, officers and directors under the 2021 Plan is 448,043.
The 2012 Stock-Based Compensation Plan (the “2012 Plan”) authorizes the grant of Stock Options, Stock Units, Stock
Appreciation Rights, Restricted Stock, Deferred Stock, Stock Bonuses and other equity-based awards. The total number of shares of the
Company’s Common Stock initially available for award under the 2012 Plan was 600,000, which was increased to 1,000,000 shares by
stockholder approval at the Company’s 2018 Annual Meeting in June 2018. Immediately prior to the replacement of the 2012 Plan by the
2021 Plan, there were 352,158 shares of Common Stock available under the 2012 Plan. The 2012 Plan has been replaced by the 2021 Plan
and none of the remaining shares of Common Stock authorized under the 2012 Plan will be transferred to or used under the 2021 Plan nor
will any awards under the 2012 Plan that are forfeited increase the shares available for awards under the 2021 Plan. As of December 31,
2021, the number of shares of Common Stock available under the 2012 Plan is zero.
During the year ended December 31, 2021, the Company granted a total of 106,122 shares of Restricted Stock to officers,
directors and employees. These shares of Restricted Stock vest immediately or over time in up to sixteen equal quarterly installments.
During the year ended December 31, 2021, 22,159 shares of Restricted Stock were forfeited as a result of officers and employees
terminating employment with the Company.
During the year ended December 31, 2020, the Company granted a total of 134,165 shares of Restricted Stock to officers,
directors and employees. These shares of Restricted Stock vest immediately or over time in up to sixteen equal quarterly installments.
During the year ended December 31, 2020, 4,682 shares of Restricted Stock were forfeited as a result of officers and employees terminating
employment with the Company.
There was no options activity during the year ended December 31, 2021 and 2020 and there were no options outstanding or
exercisable at December 31, 2021 and 2020, respectively, under both the Company’s 2012 Plan and 2021 Plan.

Table of Contents
F-26
Under the various plans, options that are cancelled can be reissued. At December 31, 2021, no cancelled options were reserved for
future reissuance.
A summary of nonvested shares of Restricted Stock awards outstanding under the Company’s 2012 Plan as of December 31,
2021, and 2020 and changes during the years ended December 31, 2021 and 2020 is as follows:
    
    
Weighted
 
Average Grant  
Date
 
Shares
Fair Value
 
Nonvested shares at January 1, 2020
 
63,922
$
14.94
Granted in 2020
 
134,165
 
14.31
Vested in 2020
 
(70,613)
 
16.36
Forfeited in 2020
 
(4,682)
 
16.85
Nonvested shares at December 31, 2020
 
122,792
$
13.37
Granted in 2021
 
106,122
 
22.96
Vested in 2021
 
(84,653)
 
17.47
Forfeited in 2021
 
(22,159)
 
16.14
Nonvested shares at December 31, 2021
 
122,102
$
18.35
As of December 31, 2021, there was approximately $2.1 million of total unrecognized compensation cost related to nonvested
share-based compensation arrangements. The unrecognized compensation cost is expected to be recognized over a weighted-average period
of 2.8 years.
For the years ended December 31, 2021 and 2020, the Company recognized share-based compensation cost of approximately $1.5
million and $1.3 million, respectively, which is included in selling, general and administrative expenses. The Company does not capitalize
any share-based compensation cost.
10.  Defined Contribution Plan
The Company maintains a defined contribution plan covering substantially all employees. Participating employees may make
contributions to the plan, through payroll deductions. Matching contributions are made by the Company equal to 50% of the employee’s
contribution to the extent such employee contribution did not exceed 6% of their compensation. During the years ended December 31, 2021
and 2020, the Company expensed approximately $0.3 million, respectively, related to this plan.
11.  Commitments and Contingencies
Employment Agreements
The Company has entered into employment agreements with four of its executive officers. If the Company terminates their
respective employment for any reason other than for cause, these executive officers are entitled to severance payments ranging from six to
twelve months at each executive officer’s then applicable base salary. Certain of these executive officers are entitled to additional severance
payments if the Company terminates their respective employment for any reason other than for cause during the term of their employment
and on or within twelve months following a change in control.
Other
As of December 31, 2021, the Company has no standby letters of credit, has no standby repurchase obligations or other
commercial commitments. The Company has a line of credit see Note 8 (Credit Facility). Other than employment arrangements, other
management compensation arrangements and related party transactions as disclosed in Note 12, the Company is not engaged in any other
transactions with related parties.

Table of Contents
F-27
12.  Related Party Transactions
The Company made sales to a customer where a member of our Board of Directors is an executive. During the years ended
December 31, 2021 and 2020, net sales to this customer totaled $0.3 million and $0.1 million, respectively, and amounts due from this
customer as of December 31, 2021 and 2020 totaled zero and $0.1 million, respectively, and the December 31, 2020 balance was settled in
cash subsequent to year end.
The Company made sales to a customer where a family member of one of our executive’s has a minority ownership position.
During the year ended December 31, 2021, net sales to this customer totaled $0.4 million and amounts due from this customer as of
December 31, 2021 totaled $0.2 million, which are expected to be settled in cash subsequent to the year end. The Company also accrued
referral fees totaling $0.2 million to this customer during the year ended December 31, 2021 and amounts owed to this customer for these
referral fees as of December 31, 2021 totaled $0.1 million, which are expected to be settled in cash subsequent to the year end.
13.  Industry, Segment and Geographic Financial Information
The Company distributes software developed by others through resellers indirectly to customers worldwide.  We also resell
computer software and hardware developed by others and provide technical services directly to customers worldwide.
FASB ASC Topic 280, “Segment Reporting,” requires that public companies report profits and losses and certain other
information on their “reportable operating segments” in their annual and interim financial statements. The internal organization used by the
public company’s Chief Operating Decision Maker (CODM) to assess performance and allocate resources determines the basis for
reportable operating segments. The Company’s CODM is the Chief Executive Officer.
The Company is organized into two reportable operating segments. The “Distribution” segment distributes technical software to
corporate resellers, value added resellers (VARs), consultants and systems integrators worldwide. The “Solutions” segment is a cloud
solutions provider and value-added reseller of software, hardware and services to customers worldwide.
As permitted by FASB ASC Topic 280, the Company has utilized the aggregation criteria in combining its operations in Canada,
Europe and the United Kingdom with the domestic segments as the international operations provide the same products and services to
similar clients and are considered together when the Company’s CODM decides how to allocate resources.

Table of Contents
F-28
Segment income is based on segment net sales less the respective segment’s cost of sales as well as segment direct costs
(including such items as payroll costs and payroll related costs, such as profit sharing, incentive awards and insurance) and excluding
general and administrative expenses not attributed to an individual segment business unit. The Company only identifies accounts
receivable, vendor prepayments and inventory by segment as shown below as “Selected Assets” by segment; it does not allocate its other
assets, including capital expenditures by segment. The following segment reporting information of the Company is provided:
Year ended
December 31,
  
2021
  
2020
Net Sales:
Distribution
$
259,360
$
233,740
Solutions
 
23,222
 
17,828
 
282,582
 
251,568
Gross Profit:
Distribution
$
36,526
$
29,136
Solutions
 
9,190
 
3,904
 
45,716
 
33,040
Direct Costs:
Distribution
$
14,610
$
12,453
Solutions
 
4,741
 
1,767
 
19,351
 
14,220
Segment Income Before Taxes: (1)
Distribution
$
21,916
$
16,683
Solutions
 
4,449
 
2,137
Segment Income Before Taxes
 
26,365
 
18,820
General and administrative
$
12,785
$
9,709
Legal and financial advisory expenses, net - unsolicited bid and related matters
—
1,586
Acquisition related costs
—
1,518
Amortization and depreciation expense
1,529
704
Interest, net
359
121
Foreign currency transaction (loss) gain
 
(46)
 
796
Income before taxes
$
12,364
$
6,220
(1) Excludes general corporate expenses including legal and financial advisory expenses, net – unsolicited bid and related matters,
acquisition related costs, amortization and depreciation expense, interest, and foreign currency transaction (loss) gain.
    
    
    
As of
As of 
December 31,
December 31,
Selected Assets by Segment:
2021
2020
Distribution
$
133,506
$
106,930
Solutions
 
18,895
 
20,807
Segment Select Assets
 
152,401
 
127,737
Corporate Assets
 
38,351
 
37,796
Total Assets
$
190,752
$
165,533

Table of Contents
F-29
Geographic areas and net sales mix related to operations for the year ended December 31, 2021 and 2020 were as follows. Net
sales is allocated to a geographic area based on the location of the sale, which is generally the customer’s country of domicile.
    
Year ended
    
December 31, 2021
Distribution
  
Solutions
Total
Geography
              
              
USA
$
210,247
$
11,057
$
221,304
Europe and United Kingdom
 
26,055
 
10,652
 
36,707
Canada
 
23,058
 
1,513
 
24,571
Total net sales
$
259,360
$
23,222
$
282,582
Timing of Revenue Recognition
              
              
Transferred at a point in time where the Company is principal
(1)
$
234,322
$
16,360
$
250,682
Transferred at a point in time where the Company is agent (2)
 
25,038
 
6,862
 
31,900
Total net sales
$
259,360
$
23,222
$
282,582
    
Year ended
    
December 31, 2020
Distribution
  
Solutions
Total
Geography
              
              
USA
$
207,362
$
13,991
$
221,353
Europe and United Kingdom
 
14,787
 
2,060
 
16,847
Canada
 
11,591
 
1,777
 
13,368
Total net sales
$
233,740
$
17,828
$
251,568
Timing of Revenue Recognition
              
              
Transferred at a point in time where the Company is principal
(1)
$
214,403
$
16,059
$
230,462
Transferred at a point in time where the Company is agent (2)
 
19,337
 
1,769
 
21,106
Total net sales
$
233,740
$
17,828
$
251,568
(1) Includes net sales from third-party hardware and software products.
(2) Includes net sales from third-party maintenance, software support and services.
Geographic identifiable assets related to operations as of December 31, 2021 and 2020 were as follows.
    December 31,
December 31,  
Identifiable Assets by Geographic Areas
2021
    
2020
USA
$
122,445
$
114,126
Canada
24,923
18,514
Europe and United Kingdom
43,384
32,893
Total
$
190,752
$
165,533

Table of Contents
F-30
The Company had two customers that each accounted for more than 10% of total consolidated net sales for the year ended
December 31, 2021. For the year ended December 31, 2021, CDW Corporation (“CDW”) and Software House International Corporation
(“SHI”), accounted for 18%, and 17%, respectively, of consolidated net sales and as of December 31, 2021, 18% and 22%, respectively, of
total net accounts receivable. For the year ended December 31, 2021, Sophos and SolarWinds accounted for 20% and 10%, respectively of
our consolidated purchases.
For the year ended December 31, 2020, CDW Corporation (“CDW”) and Software House International Corporation (“SHI”),
accounted for 24%, and 14%, respectively, of consolidated net sales and as of December 31, 2020, 19% and 9%, respectively, of total net
accounts receivable. For the year ended December 31, 2020, Sophos and SolarWinds accounted for 20% and 12%, respectively of our
consolidated purchases.
Our top five customers accounted for 51% and 52% of consolidated net sales for the years ended December 31, 2021 and 2020,
respectively.
14.  Unsolicited Bid and Shareholder Demand
On April 16, 2020 (the “Effective Date”), the Company entered into a Settlement Agreement (the “Settlement Agreement”) with
Simon Nynens, Shepherd Kaplan Krochuk, LLC, North & Webster SSG, LLC, and each of Dennis Crowley, David Shepherd, David
Kaplan, Timothy Krochuk and Samuel Kidston relating to an unsolicited bid and shareholder demand. Pursuant to the Settlement
Agreement, the Company agreed to purchase all of Mr. Nynens’ 261,631 shares of the Common Stock owned, of record or beneficially, as
of the Effective Date, at fair market value, as defined in the agreement.
On April 23, 2020, the Company purchased all of Nynens’ 261,631 shares of Common Stock at $13.19 per share pursuant to the
Settlement Agreement, representing approximately 5.8% of the issued and outstanding Common Stock of the Company, for an aggregate
purchase price of $3.5 million.
The Company incurred zero and $1.6 million in legal and advisory expenses, net during the year ended December 31, 2021 and
2020, respectively, related to the above matter.
15.  Quarterly Results of Operations (Unaudited)
The following table presents summarized quarterly results for 2021:
  
First
  Second   
Third
  
Fourth
  
Net sales
$
62,813
$
75,350
$
68,911
$
75,508
Gross profit
 
10,843
 
10,979
 
11,319
 
12,575
Net income
 
1,520
 
1,791
 
2,440
 
3,447
Basic net income per common share
$
0.35
$
0.41
$
0.55
$
0.78
Diluted net income per common share
$
0.35
$
0.41
$
0.55
$
0.78
The following table presents summarized quarterly results for 2020:
  
First
  Second   
Third
  
Fourth
  
Net sales
$
62,618
$
56,586
$
60,919
$
71,445
Gross profit
 
8,164
 
7,114
 
7,237
 
10,525
Net income
 
836
 
581
 
530
 
2,527
Basic net income per common share
$
0.18
$
0.13
$
0.13
$
0.58
Diluted net income per common share
$
0.18
$
0.13
$
0.13
$
0.58

Table of Contents
F-31
Wayside Technology Group, Inc. and Subsidiaries
Schedule II--Valuation and Qualifying Accounts
(Amounts in thousands)
    
    Charged to     
    
 
Beginning
Cost and 
Ending 
 
Description
Balance
Expense
Deductions
Balance
 
Year ended December 31, 2020
Allowance for doubtful accounts
$
765
$
130
$
3
$
892
Year ended December 31, 2021
Allowance for doubtful accounts
$
892
$
26
$
37
$
881

Exhibit 21.1
Subsidiaries (Active)
Name
    
Jurisdiction of Organization
Climb Channel Solutions, Inc.
Delaware
TechXtend, Inc.
Delaware
ISP International Software Partners, Inc.
Interwork Technologies Inc.
Wayside Technology Group Europe B.V.
Lifeboat Distribution,  EMEA B.V.
Delaware
Delaware
Netherlands
Netherlands
Wayside Technology Group (Canada), Inc.
Wayside Technology UK Holdings Limited
Canada
England and Wales
CDF Group Limited
Grey Matter Limited
Grey Matter (EMEA) Limited
England and Wales
England and Wales
Ireland

Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
Wayside Technology Group, Inc. and Subsidiaries
Eatontown, New Jersey
We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-257231,
333-237670, and 333-184573) of Wayside Technology Group, Inc. and Subsidiaries of our reports dated March 9,
2022, relating to the consolidated financial statements and schedule, and the effectiveness of Wayside Technology
Group, Inc. and Subsidiaries internal control over financial reporting, which appear in this Annual Report on Form
10-K.
/s/ BDO USA, LLP
Woodbridge, New Jersey
March 9, 2022

Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER (PRINCIPAL EXECUTIVE OFFICER)
I, Dale Foster, certify that:
1.
I have reviewed this annual report on Form 10-K of Wayside Technology Group, Inc;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
in this report;
4.
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles;
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on
such evaluation; and
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the
registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing
the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant’s internal control over financial reporting.
Date:  March 9, 2022
/s/ Dale Foster
Dale Foster
Chief Executive Officer and Director (principal executive officer)

Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER (PRINCIPAL FINANCIAL OFFICER)
I, Andrew Clark, certify that:
1.
I have reviewed this annual report on Form 10-K of Wayside Technology Group, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
in this report;
4.
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange
Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles;
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on
such evaluation; and
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the
registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing
the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant’s internal control over financial reporting.
Date:  March 9, 2022
/s/ Andrew Clark
Andrew Clark
Vice President and Chief Financial Officer (principal financial
officer)

Exhibit 31.3
CERTIFICATION OF CHIEF ACCOUNTING OFFICER (PRINCIPAL ACCOUNTING OFFICER)
I, Matthew Sullivan, certify that:
1.
I have reviewed this annual report on Form 10-K of Wayside Technology Group, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
in this report;
4.
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange
Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles;
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on
such evaluation; and
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the
registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing
the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant’s internal control over financial reporting.
Date:  March 9, 2022
/s/ Matthew Sullivan
Matthew Sullivan
Vice President and Chief Accounting Officer (principal accounting
officer)

Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Wayside Technology Group, Inc. (the “Company”) on Form 10-K for the period ending
December 31, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dale Foster, certify, pursuant
to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of
the Company.
/s/ Dale Foster
Dale Foster
Chief Executive Officer and Director
March 9, 2022
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company
and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Wayside Technology Group, Inc. (the “Company”) on Form 10-K for the period ending
December 31, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Andrew Clark, certify,
pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of
the Company.
/s/ Andrew Clark
Andrew Clark
Vice President and Chief Financial Officer
March 9, 2022
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company
and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.3
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Wayside Technology Group, Inc. (the “Company”) on Form 10-K for the period ending
December 31, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Matthew Sullivan, certify,
pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of
the Company.
/s/ Matthew Sullivan
Matthew Sullivan
Vice President and Chief Accounting Officer
March 9, 2022
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company
and furnished to the Securities and Exchange Commission or its staff upon request.