1. Whats new??? Brian Kielty bkielty@us.ibm.com 2012 Programs & Promotions June 2 nd, 2012

2. © 2012 IBM Corporation 2 Performance Rewards Blade Foundation For Cloud Min Margin Doubled Blade & Networking Payments New Customer Bonus Doubled Blade & Networking Payments Blade 1-2-3 Triple Play 1- New Customer 2- BP Led 3- Minimum Margin Program BP Led Doubled Blade Margin Minimum BCF configuration & options! Rebate for performance and certifications Bid Code Discount 20% Blades & Networking Net Rev Rebate 12% Blades & Networking + or Bid Code Discount 4% Blades & Networking Bid Code Discount 8% Blades & Networking MMP 10%Blades BCF 10% Blades and Options 1.75% Authorized 2.5% Specialty 3.5% Specialty Elite dont forget the BladeCenter Foundation for Cloud and Performance Rewards Up to Strike out the competition using 3 incentive enhancements for Blade! Through June 30th

3. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 3 Performance Rewards 512-168 and PartnerRewards512-168 Investment levelBase PerformanceTotal Range Authorized 0.75% 0% to 1% 0.75% to 1.75% Specialty 1.5% 0% to 1% 1.5% to 2.5% Specialty Elite 1.0% above Specialty (Primary Distributor) 2.5% to 3.5% Authorized Replaces RGI as baseline sales program Revenue = Min $25K prior 12 months Incentive = 1.25% Rate net rev on target (0.75% Base to 1.75% Max Rate) 1.25% *OTE 1.75% Max *OTE = On Target Earnings Specialty Certifications, Champion, References and Revenue (slight modification to 2011 Specialty) Revenue = $240K revenue prior 12 months Incentive = 2.0 % Rate net rev on target (1.5% Base to 2.5% Max Rate) 2.0% OTE 2.5% Max Specialty Elite Certifications, Champion, References, Revenue and Distributor Selection Revenue = $1.5M prior 12 months Incentive = 2.0 % net rev on target (1.5% Base to 2.5% Max Rate), plus Plus 1.0% through Selected Distributor eX5 BPs receive Specialty Elite Level payments but must achieve Specialty Elite certification by June 30 th, 2012 3.0% OTE 3.5% Max PartnerWorld PartnerRewards Questions? 800-624-6875PartnerRewards Premier Partner members with approved marketing plans Incentive = 0.5% NetRev up to $25K max per quarter @ $5M max rev 0.5% $25K/qtr Max

4. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 4 PerformanceRewards Calculator for $1,000,000 On Target Earnings (OTE) RevenueAuthorizedSpecialtyEliteAuthorizedSpecialtyElite % of TargetAttainmentPayout % Payment $ 75%750,0000.75%1.50%2.50%$5,625$11,250$18,750 76%760,0000.77%1.52%2.52%$5,852$11,552$19,152 77%770,0000.79%1.54%2.54%$6,083$11,858$19,558 78%780,0000.81%1.56%2.56%$6,318$12,168$19,968 79%790,0000.83%1.58%2.58%$6,557$12,482$20,382 80%800,0000.85%1.60%2.60%$6,800$12,800$20,800 81%810,0000.87%1.62%2.62%$7,047$13,122$21,222 82%820,0000.89%1.64%2.64%$7,298$13,448$21,648 83%830,0000.91%1.66%2.66%$7,553$13,778$22,078 84%840,0000.93%1.68%2.68%$7,812$14,112$22,512 85%850,0000.95%1.70%2.70%$8,075$14,450$22,950 86%860,0000.97%1.72%2.72%$8,342$14,792$23,392 87%870,0000.99%1.74%2.74%$8,613$15,138$23,838 88%880,0001.01%1.76%2.76%$8,888$15,488$24,288 89%890,0001.03%1.78%2.78%$9,167$15,842$24,742 90%900,0001.05%1.80%2.80%$9,450$16,200$25,200 91%910,0001.07%1.82%2.82%$9,737$16,562$25,662 92%920,0001.09%1.84%2.84%$10,028$16,928$26,128 93%930,0001.11%1.86%2.86%$10,323$17,298$26,598 94%940,0001.13%1.88%2.88%$10,622$17,672$27,072 95%950,0001.15%1.90%2.90%$10,925$18,050$27,550 96%960,0001.17%1.92%2.92%$11,232$18,432$28,032 97%970,0001.19%1.94%2.94%$11,543$18,818$28,518 98%980,0001.21%1.96%2.96%$11,858$19,208$29,008 99%990,0001.23%1.98%2.98%$12,177$19,602$29,502 100%1,000,0001.25%2.00%3.00%$12,500$20,000$30,000

5. © 2012 IBM Corporation 5 If the BP Takes No actionIf the BP does opt in NCB Game Plan 512-167512-167 4% System x PTW Bid Code 8% Blade Bid Code 8% Networking Bid Code 4% Storage Bid Code Bid Code Discount Back End Rebate If the BP opts in for enhanced Bid Codes, they will not receive NCB net revenue back end rebates 4% System x net revenue back end rebate 12% Blade net revenue back end rebate 12% Networking net revenue back end rebate 2% Storage net revenue back end rebate BP must opt in by submitting form to Trade One No action needs to be taken if BP wants to remain with the current mix of NCB front end Bid Codes plus NCB net revenue back end rebates Option for Enhanced Bid Code Bid Code Discount 7% PTW Bid Code for System x 20% Bid Code for Blades 20% Bid Code for Networking 7% Bid Code for Storage Back End Rebate Option for Enhanced Bid Codes BPs can opt in once per calendar quarter After a BP opts in, their election will not change unless they opt out (at least one calendar quarter after opting in). To opt in, BPs must submit an Opt in form that is in the announcement letter to Trade One. Trade One will reply/activate the BP within 2 business days. The decision to opt in is an enterprise decision; therefore, ALL LocIDs for the BP will be activated at once New NCB customer approval numbers for existing approvals will be assigned. Trade One will send an email with a link to the reassigned customer approval numbers. Business As Usual with…

6. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 6 New Customer Bonus (NCB) 512-167512-167 BPs that do not opt in Price To Win upfront discount and additional net revenue backend rebate 4% net revenue back end rebate for System x products 12% net revenue back end rebate for Blade 12% net revenue back end rebate for Networking 2% net revenue back end rebate for Storage Plus… additional upfront Price To Win Bid Code discount (when the transaction is a PTW On Grid transaction) Bid ProductCodePercentage System x NCBX0212A4% BladeCenter NCBB0212A8% Networking NCBN0212A8% Storage NCBS0212A4% BPs that do opt in Price To Win upfront discounts but no additional net revenue backend rebate 7% Bid Code discount for System x 20% Bid Code discount for Blade 20% Bid Code discount for Networking 7% Bid Code discount for Storage Bid ProductCodePercentage System x NCBEX0212A7% BladeCenter NCBEB0212A20% Networking NCBEN0212A20% Storage NCBES0212A7% *Business Partners whose End Users are not approved for System x, will automatically be reviewed for Blade and/or Networking eligibility. If approved, the BP will be provided with a Blade and/or Networking approval number to use with the Blade and/or Networking Bid Codes and net revenue rebates for those specific products only. Business Partners do not have to make a separate nomination.

7. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 7 System x and High Volume Storage BP Led incentive 512-107512-107 Offer Bid ProductCodePercentage System x Bid CodeBPLX0212A2% Blade Bid CodeBPLB0212A4% Networking Bid CodeBPLN0212A4% System Storage Bid Code BPLS0212A2% System x and High Volume System Storage BP Led Approvals -BPs can request approval for end users by utilizing the approval request web link that is published in the announcement letter http://www.bpledapprovalrequests.comhttp://www.bpledapprovalrequests.com How do I access my end user approval numbers? –Business Partners can go to their Trade One Portal sign in, click on the Reports drop down menu at the top of the page and select BP Led. BPs can also call 800-477-6756 Trade One (IBM Promotional Marketing Center) if they need assistance.Trade One Portal Whos a BP Led end user? –End Users are classified as Business Partner Led End Users if they do not appear on the IBM-led list. How long are my approved BP Led end user approval numbers valid? –Business Partner Led approval numbers will not expire, unless an End User is reclassified by IBM. Business Partners will receive 30 days notice that previously issued Business Partner Led approval numbers will expire.

8. © 2012 IBM Corporation Building a smarter planet 8 BladeCenter Foundation for Cloud (BCF10) 512-165 512-165 New BladeCenter Foundation Incentive – 10% IncentiveBCF10 – 10% incentive on key BladeCenter Foundation solution elements – Back-end – based on End User sales data provided – Requires minimum set of eligible parts acquired at the same time and appear on a single Distributors invoice and date – Incentive pays on Blades, Chassis and Select BCF solution options – Incentive rewards up-selling to 10Gb and virtual fabric solutions 8 Must have minimum quantities of these… Qty 1 BladeCenter H Chassis (8852xxx) Qty 4 Blades HS23, HS22, HS22V, HX5 (7875xxx, 7870xxx,7871xxx,7872xxx, 7873xxx) Qty 1x3550 M3 Management Node (7944DDU) *– same Distributor invoice and same invoice date To earn rebate on these… Chassis, Blades, Management Node… plus Core Chassis Options (10Gb Ethernet and 8Gb FC switches) Core Blade Options (10Gb and 8Gb I/O cards) Open Fabric Manager software Dynamic Racks (for ship-load capability through distributors) Storage Controllers and Expansion Units All quantities to appear on same Distributor invoice and invoice date. Sell the minimum configuration and earn 10% net rev rebate Enhance the solution with eligible adapters, switches, software utilities, and a rack Get paid 10% net rev rebate on everything

9. © 2012 IBM Corporation Building a smarter planet 9 BCF10 - Full Options Listing 9 Starter Kit for Cloud x86 edition Per Managed Server with 1 Year Software 00D4658 Subscription and Support Per Managed Server with 3 Year Software 00D4659 Subscription and Support Racks IBM S2 42U Dynamic Racks 9956-xxx IBM 42U Enterprise Racks 9308-xxx IBM 42U 1200mm Deep Dynamic Rack 9360-xxx IBM 25U Racks 9307-25U IBM 11U Office Enablement Kit 2018-86X 10Gb Ethernet Adapters Broadcom 10Gb Gen2 4-port Ethernet (CFFh) 46M6164 Broadcom 10Gb Gen2 2-port Ethernet (CFFh) 46M6168 Broadcom 2 port 10Gb Virtual Fabric 2 (CFFh) 81Y3133 Brocade 2 port 10GbE Converged Network Card 81Y1650 Emulex Virtual Fabric Adapter (CFFh) 49Y4235 Emulex 10GbE Virtual Fabric Adapter 2 90Y3550 Emulex 10GbE Virtual Fabric Adapter 2 Adv. 90Y3566 Intel 10Gb 2-port Ethernet Expansion (CFFh) 42C1810 Mellanox 2-port 10Gb Ethernet (CFFh) 90Y3570 QLogic 2-port 10Gb Converged Network (CFFh) 42C1830 10Gb Ethernet Switches BNT Virtual Fabric 10Gb Switch Module 46C7191 Brocade Converged 10GbE Switch Module 69Y1909 Cisco Nexus 4001i Switch Module 46M6071 S/W Upgrade License for Cisco Nexus 4001i 49Y9983 Fibre Channel Adapters Emulex 8Gb FC Expansion Card (CIOv) 46M6140 Emulex iSCSI/FCoE Virtual Fabric Upgrade 49Y4265 Emulex iSCSI/FCoE Virtual Fabric Adapter 49Y4275 QLogic Ethernet and 8Gb FC Card (CFFh) 44X1940 QLogic 8Gb Fibre FC Card (CIOv) 44X1945 QLogic Virtual Fabric Extension Module 46M6172 Fibre Channel Switches Brocade 20-port 8Gb SAN Switch Module 44X1920 Brocade Enterprise 20-port 8Gb SAN Switch 42C1828 Brocade 10-port 8Gb SAN Switch Module 44X1921 QLogic 20-port 4/8 Gb SAN Switch Module 88Y6406 BladeCenter Software Utilities IBM BladeCenter Open Fabric Manager 46C3552 - Advanced Upgrade for IBM Director IBM BladeCenter Open Fabric Manager 46C3551 - Advanced Upgrade IBM BladeCenter Open Fabric Manager 44W3981 IBM BladeCenter Open Fabric Manager 2019B1X IBM BladeCenter Open Fabric Manager 4812S3X 3.0 - Advanced Upgrade IBM BladeCenter Open Fabric Manager 4812S3D 3.0 - Advanced Upgrade for IBM Director DS3524 Storage DS3524 Express Dual Controller 1746A4D DS3524 Express Expansion Unit 1746A4E Must have minimum quantities of these… Qty 1 BladeCenter H Chassis 8852xxx Qty 4 Blades (HS23, HS22, HS22V, HX5) 7875, 7870, 7871, 7872, 7873xxx Qty 1 3550 M3 Management Node 7944DDU Same Distributor invoice and same invoice date all quantities To earn rebate on these… Chassis, Blades, Management Node… plus Core Chassis Options (10Gb Ethernet and 8Gb FC switches) Core Blade Options (10Gb and 8Gb I/O cards) Open Fabric Manager software Dynamic Racks (for ship-load capability through distributors) Same Distributor invoice and same invoice date as min configuration

10. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 10 Express server + Options incentive 512-191512-191 Easy to sell, install, deploy and manage! Sell an eligible System x Express server with eligible System x options and receive a back-end rebate for 10% of the list price of the options PTW Grid 1 transactions are eligible for payment Transactions with over 30 options per Express server will be reviewed to determine eligibility Options must be configurable to the Express server and within the limitations of the server Eligible Express servers Tower Express servers X3100 M4, x3200M3, x3400M3, x3500 M4, x3500M3 Rack Express servers x3250 M4, 3250M3, x3550 M4, x3550 M3, x3620 M3, x3630M3, x3650 M4, x3650M3 High End Express servers x3690 X5, x3850X5 Blades and Chassis HX5, HS23, HS22V, HS22, BC-S Chassis The Express server and options must be acquired at the same time and appear on a single Distributor invoice

11. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 11 Channel Evaluation 512-261512-261 Slide 112012 IBM Corporation Deal Terms and ConditionsSmallMediumLarge Deal size range by List price$0-$49,999$50,000-$99,999> $100,000 Bid Code DiscountEVAL2012SM 15%EVAL2012MD 10%none Deal Registration requiredNoYes Pricing DelegationGrid 1Grid 2Grid 2 or Bid Restocking Fee if Returned5% 10% Additional Restocking Fee if Trial Extended5% 10% Length of Trail90 days 120 days Quantity LimitsSmallMediumLarge Maximum Number of Systems per Eval48No limit Maximum Number on an Option Only evaluation1632Not Applicable System Networking ToR Switches24No limit System Networking Options64128No limit Eval Limits per End-User Per End-User – Active at any time2 - Any Size Per End-User per year3 - Any Size Eval Limits per BP Total Evals per BP per quarter / annual5 Total / 20 annual Total Evals per BP by Eval Size per quarter421 Any Channel Evaluation requests submitted and approved prior to June 1, 2012 will be administered under the terms and conditions of Announcement Letter 511-394.511-394

12. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 12 Technology Access Program (TAP) 512-198512-198 TAP rebate plus Bid Index allowance equals eligible percentage off List discount. Discounts are as follows: System x Product Groups QTYDiscount Selected Starter Kit for Cloud x86 edition1-4 100% Selected Starter Kit for Cloud x86 edition 5-2040% Selected IBM BNT Network Switches 1-2 80% System x Servers & Blades 1-240% (Any standard model) 3-12 20% System x Racks 1-240% System x Racks 2-1220% Options 1-1640% Options 17-9620% HV System Storage Description Part # Qty Discount DS3400 1726xxx 1-2 40% 3-12 20% EXP3000 1727xxx1-2 20% 3-12 15% DS3500, EXP3500, EXP25001746xxx, 1747xxx 1-2 45% 3-12 35% DS4000 EXP810 181281H 1-2 45% 3-12 38% TS2900 Tape Library 3572xxx 1-2 45% 3-12 38% TS3100, TS3200 Tape Library3573xxx 1-2 45% 3-12 38% TS2230 Tape Library 3580xxx 1-2 38% 3-12 33% TS2240, TS2340Tape Library 3580xxx 1-2 45% TS2250, TS2350 Tape Library 3-12 38% Options1-1645% Options17-9638% The Technology Access Program (TAP) offers selected PartnerWorld members the ability to buy System x servers, BladeCenter products, selected HV System Storage products, and options at discounts off the IBM Web price minus bid index % for internal use, demonstration or development purposes. Rebate claims must be submitted within 45 days of invoice to receive a payment. TAP claim form Hypothetical Discount Example Blade / High-End Server List Price $1,000 Distributor Discount $ 140 14% TAP Rebate $ 260 26% Total Discount $ 400 40% OFF LIST

13. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 13 Public Sector Fee incentive 512-200512-200 Business Partners must notify the customer that the BP might receive a fee from IBM and the BP must provide IBM with a copy of the customer notification. Customer notifications must be renewed once every twelve months and IBM provided with a copy of the renewal notification. The Business Partners name, valid System x LocID, and eligible contract number (as published in the announcement letter) must be included on every end user PO Fees for configurations are processed based on the overall unit cost NOT an individual per component basis ProductRate System x and BladeCenter Options Third party software purchased from IBM: VMware, Altiris, Red Hat Linux, SUSE Linux, Remote Deployment Manager (RDM) 6.5% High-Performance Systems System x3755 M3, x3850 X5, x3690 X5 Servers 5% BladeCenter and Chassis BladeCenter S, E, H, T, HT Chassis, HS23, HS22, HS22V, HX5 6.5% High Volume Server Systems System x3250 M4, x3400 M3, x3500 M4, x3500 M3, 3550 M4, 3550 M3, 3620 M3, 3630 M3, 3650 M4, 3650 M3, Smart Cube Servers 3.5% Entry High Volume Servers System x3100 M4 Servers 3.0% System x and BladeCenter Express Models 2.0% iDataPlex 3.0% HV System Storage DS3000, DS3200, DS3300, DS3400, DS3500, DS4000TM, DS4200, DS4700, DS4000TM EXP810, LTO, SAN 3.0% HV System Storage Express DS4000, LTO, SAN 2.0%

14. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 14 System x Specialty – North America 511-073511-073 System x Specialty – available since May 2010 System x Specialty – accreditation benefits… 1.Specialty certification enables participation in Performance Rewards Specialty level incentive payments 2.Specialty Mark 3.Additional education and certification vouchers 4.Additional Business Partner Technical Vitality (BPTV) points will be awarded to the Business Partners company score 5.Access to Pre-sales Support Deal Hub without Clip Levels 6.Systems Connect eXpert Benefits for an identified System x Champion For complete information on System x Specialty enrollment, benefits, and details, please refer to the PartnerWorld specialty website: https://www-304.ibm.com/partnerworld/wps/servlet/ContentHandler/isv_com_spe_sysx_resel_start https://www-304.ibm.com/partnerworld/wps/servlet/ContentHandler/isv_com_spe_sysx_resel_start Each IOT/geography has its own System x Specialty Benefits

15. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 15 System x Specialty Elite – North America 512-169512-169 System x Specialty Elite – accreditation benefits… 1.Specialty Elite certification enables participation in Performance Rewards Specialty Elite level incentive payments 2.Specialty Elite Mark 3.Additional education and certification vouchers (not incremental if BP had already received in Specialty) 4.Additional Business Partner Technical Vitality (BPTV) points will be awarded to the Business Partners company score 5.Access to Pre-sales Support Deal Hub without Clip Levels 6.Systems Connect eXpert Benefits for an identified System x Champion Visit the following web site for information on System x Specialty Elite enrollment, benefits, and details: https://www-304.ibm.com/partnerworld/wps/servlet/ContentHandler/isv_com_spe_sysx_resel_start Each IOT/geography has its own System x Specialty Elite Benefits

16. © 2012 IBM Corporation IBM System x - BladeCenter – iDataPlex 16 System x SpecialtySystem x Specialty and Specialty Elite ComparisonSpecialty Elite Summary of Specialty and Specialty Elite Program Requirements: Skills CriteriaSpecialtySpecialty Elite Business Criteria - Annual Revenue$240, 000 revenue$1,500,000 Revenue Skills CriteriaSpecialtySpecialty Elite Sales certifications (1 pt per test)3 pts minimum4 pts minimum Minimum employees to meet criteria1 employeeCombo of 4 employees Sales Specialist - System x11 Sales Expert - System x and Blade11 Solution Advisor - Cloud11 Technical certifications (2 pts per Fundamentals, 3 pts per Specialist) 11 pts minimum12 pts minimum Minimum employees to meet criteriaCombo of 2 employeesCombo of 4 employees Technical Fundamentals - System x2 (req'd) Certified Specialist - System x and Blades1 (req'd) Technical Fundamentals - HV Storage1 (req'd) Certified Specialist - Systems Management 1 opt 1 (req'd) Solution Specialist - Cloud Architecture1 opt1 (req'd) Additional/Ancillary certifications (1 pt per test)2 pts minimum Total Skills Pts Required14 pts18 pts Reference Criteria2 (1 pt/ref)3 (1 pt/ref) Total Pts18 pts + Revenue Requirement21 pts + Revenue Requirement Specialty web site to get started

17. © 2012 IBM Corporation Building a smarter planet 17 2012 Incentives Landscape 17 JanFebMarchAprilMayJuneJulyAugSeptOctNovDec New Customer Bonus enhanced in February- Doubled Blade and Networking payments! 8% Blade & Networking Bid Codes plus 12% Blade and Networking net rev rebate or… Opt-in for All-Up-Front enhanced Bid Codes - 20% Blade and Networking Bid Codes (in lieu of back end 12% net rev rebates) Express + Options New Customer Bonus Blade Focus On-Going Offers Channel EvalChannel Eval, TAP, Public Sector Fee, Specialty, Specialty Elite, Pre-Sales Services, MMP, PartnerRewardsTAPPublic Sector FeeSpecialtySpecialty ElitePre-Sales ServicesMMPPartnerRewards BladeCenter Foundation –10% net rev rebate incentive System x PerformanceRewards Business Partner Led enhanced in February- Doubled Blade and Networking Bid Codes! 4% Bid Codes for Blade and Networking Minimum Margin Program (MMP) Doubled for Blades through June 30th!