Innovative Structures to fund IT Acquisitions in Bulgaria (Business Partner)

1. Innovative Structures to fund IT Acquisitionsin Bulgaria (Business Partner) Claudia WeiserIBM Global Financing Territory Sales Leader New MarketsPhone: +43 1 211 45 3531 Mobile: +43 664 618 7188 Email: claudia_weiser@at.ibm.com

2. IBM Global Financing portfolio CommercialFinancing Global AssetRecovery Services Client Financing Provides working capital for IBM Business Partners and suppliers Provides financing (leases and loans) for the acquisition of IT solutions Offers comprehensive services for used hardware, including resale and disposal Experts in financing technology and solutions • Unlike banks, we focus primarily on solution and technology financing • We provide single-source financing that helps our clients acquire business services and technology services, hardware and software ― IBM and non-IBM • We offer flexible financing with competitive rates to businesses of all sizes and across all industries • We offer complete financial plans for the lifecycle of your investment

3. IBM Global Financing is the World‘s Leading Provider of IT Financing • IBM Global Financing (IGF) has • 125.000 Clients - largest clients are in the Financial & Industrial Sectors • 90% of the Fortune 500 finance with IGF • $35 Billion in Assets • Operations in more than 40 countries • 3.500 Employees worldwide • 30 Years experience • We finance • IBM and Non IBM Hardware and Software • e.g.: Server, Storage, PC, Notebook, Printer, Networking (Voice & Data), … • One Time SW Charge, No leasing • IBM and non IBM IT Services • Accepted mile stone completion, No leasing • Non IT equipment • e.g. Medical, Production equipment, intelligent office equipment, Biotech machines, …

4. What is our value proposition for your customers? Pay as you earn • Turn large upfront costs into affordable monthly payments • Match cash flow to business benefits Conserves cash • Control expenses, conserve cash for other strategic investments • Overcome current budget limitations Provides more payment options • Flexible and tailored payment options • Payment holidays up to 6 months possible Simplifies budgeting • Fixed payment for duration of financing period • IBM Financing is an additional source of funding to existent Bank facilities Preserves lines of credit

5. $ Benefits Payments (with IGF) Expenditures (without IGF) Time Use IBM Global Financing as value add for your solution Financing is useful where: • A customer wants to start a project but does not have budget to fund it • Projects are measured on a “Payback” basis • The customer wants a project to “pay for itself” • A project has significant up front costs or milestones that the customer wishes to defer or pay in installments How IGF can help fund a project cash flow

6. Illustrative Period How IBM Global Financing can contribute • Use the IGF Option as a trigger to close new engagements – we can help to overcome a client‘s budget constraints • Provide your customer with a total solution offering including a financing option – no need to involve 3rd parties (banks) • Avoid requests for extensive extended payment terms and make your deal more profitable • Conserve Cash for investments in core business • Align repayment streams closely with anticipated project benefits • Improve budget management with predictable costs

7. How does the financing model through IBM Business Partners work? Customer Financing Business Partner 1. Purchase agreement in $ 2. IT Supply IBM or other IT Supplier Customer • 4. Purchase • of HW, SW & • Invoice 5. Settlement $ $ IBM Global Financing 3. IPP (Installment Payment Plan) & HW, SW Provision Agreement & COA (Certificate of Acceptance) & Payment stream • Reduction in DSO (days sales outstanding) • Reduction in Credit Risk

8. Customer Financing How does the financing model through IBM Business Partners work? (Option 2) Business Partner • Purchase agreement in $ • IPP (Installment Payment Plan) Agreement & Payment Stream IT Supply & Invoice with payment stream Reseller IBM Enduser Customer Enduser Customer Promissory Notes

9. Some internal IGF References in CEMA – HW/SW/SVC

10. Q1 Fast Start Software Financing Play • 0% or low rate financing on IBM SW for 12 month terms until 29/2/2008! • Purpose: • Use IGF as a close & lead progression tool • Pull ahead opportunities to the front end of the quarter • Minimize the need for discounting • Close more SW deals • Offer: • 0% or low rate financing (depending on the country) on IBM SW for 12 month terms • RBD 5% (GRMG credit rating 4-6), RBD 4% (GRMG credit rating 1-3) • Financing – significantly below customer Cost of Debt e.g.: • 3% customer IRR for Russia and Croatia • 2% IRR for Hungary • 1% IRR for Poland/Slovenia/Slovakia • 0% IRR for Czech Rep. • 0% IRR for Austria & Switzerland • For all other CEMA countries – pricing by Catalin Barascu or Claudia Weiser • Timing: Offer valid for deals that close before End of February 2008 • Deal size: Minimum TCV size: $10k • Availability: • All SWG OTC product eligible, All direct and channel deals, valid on CEMAAS orders • all deals are subject to Jim Koerner's approval - VP SWG CEMAAS

11. How can we offer Installment Payment Plans? • What do we need for an offer? • Client (name, address, contact, financial data if available...) • HW/SW prices per brand, SVC milestone and price • Planned shipment date • Client‘s requested financing structure eg. Monthly, quarterly repayments, payment holidays • Minimum 4 months financing term, up to 5 years • Minimum TCV approx. 100 KUSD (start with 50KUSD) • How quick can an offer be established? • Goal is 3 days after all information is obtained