1Q 2008 Programs and Promotions

1. 1Q 2008 Programs and Promotions

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3. * Incentives are paid on end-user reported Sales - Click to report your sales via the Web Back to Contents

4. * Incentives are paid on end-user reported Sales - Click to report your sales via the Web Back to Contents

5. Appendix A - Eligible Part Numbers for Short-Term Promotions Stay tuned for upcoming February short term promotion announcements Back to Promotions Page ** Upfront price discount from Distributor * Incentives are paid on end-user reported Sales - Click to report your sales via the Web

6. 2008 Incentives Programs and Promotions Summary January 23, 2008 Brian Kielty bkielty@us.ibm.com Title slide

7. 2008 System x and System Storage Growth Incentive System x and System Storage Growth Incentive 508-441 RequirementsAchieve PartnerWorld Member, Advanced, or Premier level status • Achieve minimum of $25K System x sales in 2007 or previous quarter 2008 • Achieve a quarterly EDI end user sales target($25K or 6% uplift for System x and $25K or 25% uplift for System Storage over previous year same quarter whichever is greater)Reduced from 15% and $50K for System x in2007 Incentive Payments • If 85% of the quarterly 2008 sales revenue target is met, the amount of the quarterly incentive payment will be equal to 0.5% for both the System x target and the System Storage Target (Ability to earn $$$ on both products!) • If 100% of the quarterly 2008 System x sales revenue target is met, the amount of the quarterly incentive payment will be equal to 1% for System x and also earn 1.5% on System Storage for achieving 100% of the System Storage target! • If over 100% of the quarterly 2008 System x sales revenue target is met, the amount of the additional payment will be equal to .5% on the amount over 100% for System x and also earn an additional payment of 2.5% on System Storage on the amount of System Storage over 100% of the System Storage target • Business Partners who meet or exceed their quarterly System x Level One Target and also meet or exceed their quarterly System Storage Level Two target will receive an over-achievement bonus equal to .5% of their reported System x End-User sales for that quarter. Premier PartnersRecovery Incentive Premier Partners who meet or exceed the combined sum of their 1st and 2nd quarter sales revenue targets by 6/30/2008 but miss one or more quarterly targets will receive 70% of the difference between the quarterly incentive payment they received for the quarter (if any), and the quarterly incentive payment they would have received had they achieved 100% of their quarterly sales revenue targets for 1st and 2nd quarter. Premier Partners who meet or exceed the combined sum of their 3rd and 4th quarter sales revenue targets by 12/31/2008 but miss one or more quarterly targets will receive 70% of the difference between the quarterly incentive payment they received for the quarter (if any), and the quarterly incentive payment they would have received had they achieved 100% of their quarterly sales revenue target for 3rd and 4th quarter. 2007 offered only an annual look back.

8. 2008 BladeCenter and Enterprise System x Growth Incentive BladeCenter and System x Enterprise Growth Incentive 508-438 Requirements • Achieve PartnerWorld Member, Advanced, or Premier level status • Achieve minimum of $25K System x sales in 2007 or previous quarter 2008 • Achieve a quarterly EDI end user sales target of eligible Blade product and Enterprise System x productequal to 15% uplift or 25K for Blade and 10% uplift or $25K of eligible product for System x over previous year same quarter whichever is greater (was 30% for Blades in 2007) Incentive (separate targets for BladeCenter and Enterprise System x) • If 85% of the sales revenue target is met, the amount of the quarterly incentive payment will be equal to 0.5% (for each product) • If 100% of the 4Q eligible product sales revenue target is met, the amount of the quarterly incentive payment will be equal to 1.5% (for each product) • If over 100% of the 4Q eligible product sales revenue target is met, the amount of the additional payment will be equal to 2.5% on the amount over 100% (for each product)

9. 2008 System x and System Storage SMB New Customer Bonus 2008 System x and System Storage SMB New Customer Bonus (NCB) 508-436 • Incentive to sell to New System x and System Storage SMB Customers throughout the year • Registration and approved nomination required (www.ncbprogram.com) • No (or less than $25K) System x and System Storage revenue in last 12 months • Selected BladeChassis revenue counts 2x Bid Index revenue • Selected System x3950 revenue counts 3x Bid Index revenue • Enable greater SMB Expansion and Reseller Participation • Incentive payouts begin at low clip level ($10K) • Enterprise License Agreements (ELA) and System x Express Seller Incentive products are not eligible Revenue and Incentive payment Schedule Earn up to $20K for System x plus System Storage new customer sales! System x or System Storage Total SMB new customer System Storage 2008 sales Incremental Total Incremental Total revenue target Payment Payment Payment Payment $ 10,000 $ 500 $ 500 $ 500 $ 500 25,000 500 1,000 500 1,000 50,000 500 1,500 500 1,500 100,000 1,500 3,000 1,500 3,000 250,000 2,000 5,000 2,000 5,000 500,000 5,000 10,000 5,000 10,000

10. 2008 System x and System Storage Express Seller System x and System Storage Express Seller IBM08-442 Requirements • Meet a $6,000 sales target for EDI or Web-based reported End User sales of eligible new System x and System Storage Express products. Incentive • Incentive = 2% (on eligible System x and System Storage Express product) • The 2% incentive is paid based on Bid index price at the time of invoice to the end user

11. 2008 Channel Evaluation Program Channel Evaluation 508-430 Program Overview • Eligible IBM Business Partners can offer their End Users an on-site evaluation of System x, BladeCenter, IntelliStation, System Storage products, and options • Maximum evaluation period of up to 90 days from the date the evaluation is approved by IBM. • Business Partners can receive incentive payments for reported sales of channel evaluation products, except express models • Business Partners can use existing inventory to fulfill evaluation requests, or order channel evaluation products directly from an authorized IBM U.S. Distributor. Incentive Structure • Evaluations per Business Partner Enterprise will be governed by a quarterly ticket release system. Each evaluation ticket will be active for a predetermined number of evaluations based upon the quarter in which it is released. Tickets expire when channel evaluation products are returned to IBM, or when the predetermined number of evaluations is reached. Return fee reduce from 10% to 5% for 2008 • Two sales rewards tickets will be released per BP at the close of the first, second and third quarters if at least 75% of their year-to-date evaluations have resulted in a sale to an End User. System x Express models are excluded. • U.S. Federal, State, or Local government entities are excluded from incentives payments but will be eligible for special bid consideration. System x Express Seller models are excluded. Channel Evaluation may be combined with Sell More Blue The amount of the incentive payment will be equal to: • Percentage of the regular published IBM Web price of the product, on the date the product was approved for evaluation, as follows: Incentive                                                       payment % Product description                                 of Web price IntelliStation workstations                       15% System x high-performance server x3950+               30%   (includes scalable systems) System x high end servers                             30% System x low end servers                               15% System x Blade and BladeCenter                         30% System Storage products                             15% Options                                               20%

12. 2008 Technology Access Program (TAP) TAP 508-431 • The Technology Access Program (TAP) offers selected PartnerWorld members the ability to purchase System x Servers, BladeCenter products, IntelliStation ,selected System Storage products, and options at discounts off the IBM web price minus bid index % for internal use, demonstration or development purposes. • TAP rebate plus bid index allowance equals eligible percentage off list. Discounts are as follow: Discount* Minus Options Product Groups QTY Bid Index% Per Unit System x Servers & Blades (1) 1-2 40% 8 (4) (Any standard model) (5)(6) 3-12 20% 8 IntelliStations (2) 1-6 40% 8 (Any standard model) 7-46 20% 8 Monitors 1-2 40% T117 17" TFT (494317U) T119 19" TFT (494419U) System Storage (3) Part Qty DISC* Per Unit Description Number 3-12 20% 8 DS3200, DS3300 & DS3400 1726xxx 1-2 40% 8 3-12 38% 8 DS4000(TM) EXP810 181281H 1-2 45% 8 3-12 38% 8 DS4800 Model 82 181582H 1-2 45% 8 3-12 38% 8 DS4800 Model 84 181584H 1-2 45% 8 3-12 38% 8 DS4800 Model 88 181588H 1-2 45% 8 3-12 38% 8 DS4800 Model 80 181580H 1-2 45% 8 3-12 38% 8 DS4700 Model 70 Express 181470H 1-2 45% 8 3-12 38% 8 DS4700 Model 72 Express 181472H 1-2 45% 8 3-12 38% 8