2018 IBM Benefits and Programs Summary - IBM.com

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2018 IBM Benefits and Programs Summary - IBM.com
2018 IBM Benefits and
Programs Summary
TABLE OF CONTENTS
                                                                  BUSINESS TRAVEL ACCIDENT INSURANCE PLAN        12
2018 IBM BENEFITS SUMMARY                               3
  ELIGIBILITY                                       3           MEDICAL COVERAGE (AFTER YOU LEAVE IBM)            12
  ABOUT YOUR HEALTH, LIFE AND DISABILITY BENEFITS   3            TRANSITIONAL MEDICAL PROGRAM (TMP)              12
                                                                 RETIREE MEDICAL COVERAGE                        12
MEDICAL CHOICES                                    3
                                                                 MEDICARE                                        13
  IBM PREFERRED PROVIDER ORGANIZATION (PPO)      3
                                                                 SURVIVOR HEALTH BENEFIT                         13
  IBM PPO PLUS                                   3
  IBM PPO OR IBM ENHANCED PPO WITH HEALTH SAVINGS               CAPITAL ACCUMULATION AND INVESTMENT               13
ACCOUNT (HSA)                                    3                IBM 401(K) PLUS PLAN                           13
  HEALTH MAINTENANCE ORGANIZATION (HMO)          4                401(K) PLUS PLAN INVESTMENT OPTIONS            14
  IBM EXCLUSIVE PROVIDER ORGANIZATION (EPO)      4                EMPLOYEES STOCK PURCHASE PLAN (ESPP)           14
  TOBACCO SURCHARGE                              4
                                                                TIME OFF                                          14
  PRIMARY CARE                                   4
                                                                  HOLIDAY PLAN                                   14
  CARE MANAGEMENT                                5
                                                                  VACATION PLAN                                  14
  CENTERS OF EXCELLENCE                          5
                                                                  PERSONAL TIME OFF                              15
  BEST DOCTORS                                   5
                                                                  IBM LEAVES OF ABSENCE PROGRAM (LOA)            15
  2018 MEDICAL BENEFITS: COMPARING PLAN FEATURES 6
                                                                  IBM PARENTAL BONDING LEAVE                     15
IBM’S LIVE WELL. LIVE BETTER. REWARDS
                                                                FAMILY AND PERSONAL SERVICES                        15
PROGRAM                                                 7
                                                                  THOMAS J. WATSON MEMORIAL SCHOLARSHIP            15
  WELLNESS DEVICE VOUCHER                           7
                                                                  ADOPTION AND SURROGACY ASSISTANCE PLAN           16
  QUARTERLY WELLNESS DRAWINGS                       7
                                                                  SPECIAL CARE FOR CHILDREN ASSISTANCE PLAN (SCCAP)16
  HEALTH SAVINGS ACCOUNT (HSA) INCENTIVES           7
                                                                  COLLEGE COACH PROGRAM                            16
PRESCRIPTION DRUG BENEFITS                              8         GLOBAL WORK/LIFE FUND (GWLF)                     16
  MAINTENANCE CHOICE®                               8             IBM MONEYSMART                                   16
  GENERICSADVANTAGE                                 8             SOFI STUDENT LOAN REFINANCING                    16
  SPECIALTY MEDICATIONS                             9             EXPRESSLY SERVICE FOR TRAVELING MOTHERS          16
  PRESCRIPTION DRUG COVERAGE                        9
                                                                OTHER IBM BENEFIT PROGRAMS                        17
MENTAL HEALTH BENEFITS                                  9         EMPLOYEE REFERRAL BONUS PROGRAM                17
 MANAGED MENTAL HEALTH CARE PROGRAM                 9             IBM CLUB                                       17
 EMPLOYEE ASSISTANCE PROGRAM (EAP)                  9             DISCOUNTS FOR IBMERS                           17
                                                                  EMPLOYEE PURCHASE PROGRAM                      17
DENTAL CHOICES                                       10
  IBM DENTAL BASIC                                  10          CAREER DEVELOPMENT PROGRAMS                       17
  IBM DENTAL PLUS                                   10            NEW2BLUE ESSENTIALS                            17
                                                                  ACADEMIC LEARNING ASSISTANCE PROGRAM (ALAP)    17
VISION CHOICES                                       11
                                                                  YOURLEARNING                                   17
   IBM VISION PLAN                                  11
                                                                  THINK40                                        17
   EYEMED VISION DISCOUNT PLAN                      11
                                                                  CAREERS@IBM                                    18
FLEXIBLE SPENDING ACCOUNTS                           11
                                                                IBM CORPORATE CITIZENSHIP & CORPORATE
  HEALTH CARE SPENDING ACCOUNT (HCSA)               11
                                                                AFFAIRS                                           18
  DEPENDENT CARE SPENDING ACCOUNT (DCSA)            11
                                                                  CORPORATE SERVICE CORPS                        18
  COMMUTER BENEFITS PROGRAM                         11
                                                                  ON DEMAND COMMUNITY                            18
LIFE AND DISABILITY BENEFITS                         12           IBM COMMUNITY GRANTS                           18
   SHORT-TERM DISABILITY (STD) INCOME PLAN          12            IBM MATCHING GRANTS PROGRAM                    18
   LONG-TERM DISABILITY (LTD) PLAN                  12            EMPLOYEE CHARITABLE CONTRIBUTION CAMPAIGN      18
   GROUP LIFE INSURANCE (GLI)                       12
                                                                IMPORTANT LEGAL INFORMATION                        19
   GROUP UNIVERSAL LIFE (GUL) INSURANCE PROGRAM     12

                                                            2
IBM has implemented policies and practices to appropriately protect the privacy of your personal health information. Personal health
information you provide will be handled in accordance with IBM Corporate Instruction HR113 98/11: Protection of Employee Information and
the IBM Guidelines for the Protection of Employee Information. To obtain a copy of these documents, please contact the IBM Employee Services
Center. The benefits and programs described in this brochure are for IBM regular employees.

2018 IBM Benefits Summary                                                   services before the plan pays for non-routine
                                                                            preventive care. In addition, care provided by your
IBM offers a competitive benefits program, designed to
                                                                            in-network primary care physician is covered at
support employees and their families across all dimensions
                                                                            100%. You may see any provider you choose without
of health: physical, mental, social, financial, and purpose.
                                                                            obtaining a referral. If you reach the annual in-
Key features:                                                               network out-of-pocket maximum, the plan will pay
  •    Health Benefits Portfolio that provides strong                       100% of your in-network medical, mental health and
       support for employee well-being and preventive                       pharmacy expenses for the remainder of the year.
       care, comprehensive coverage to meet a range of                      This plan option has a lower monthly cost for employees
       medical situations, and solid protection against the                 and dependents, but has a higher deductible and out-of-
       cost of serious injury or illness.                                   pocket maximum than the IBM PPO Plus.
  •    Retirement Program that helps build future
       financial security through a leading-edge 401(k)                     IBM PPO Plus
       plan and other capital accumulation programs.                        The IBM PPO Plus offers the same broad network of
                                                                            providers available through the IBM PPO, along with the
  •    Income Protection in case of serious illness, injury                 flexibility to seek care out-of-network at a higher cost (a
       or death, including life insurance and disability                    deductible may apply to medical and mental health
       benefits.                                                            services). You may see any provider you choose without
  •    Opportunity to follow leisure pursuits through                       obtaining a referral.
       vacation, personal leave and holiday plans.                          Under PPO Plus, you'll pay a higher monthly contribution
                                                                            for coverage and — with a lower in-network deductible —
Eligibility                                                                 potentially lower overall costs for care. If you reach the
You are eligible for all applicable benefit programs, except                annual in-network out-of-pocket maximum, the plan will
the IBM Employees Stock Purchase Plan, beginning with                       pay 100% of your eligible medical, mental health and
your first day of employment. Health care coverage                          pharmacy expenses for the remainder of the plan year. It
(medical, dental and vision) is available for you, your                     also offers the same strong coverage for prevention,
spouse or eligible domestic partner, eligible children and                  wellness and routine medical care. There is no charge for
other eligible dependents.                                                  in-network eligible, routine preventive services. Care
                                                                            provided by your in-network primary care physician will be
                                                                            covered at 100%.
About your Health, Life and Disability Benefits
IBM provides a range of options, to allow employees to
design a program that meets their personal or family                        IBM PPO or IBM Enhanced PPO with Health Savings
circumstances. You can enroll in benefits when you first                    Account (HSA)
join IBM, and you’ll have the opportunity to review and                     The IBM PPO and IBM Enhanced PPO with HSA are high-
change your benefits each year during the enrollment                        deductible options that feature a health savings account,
period, usually held in the fall. Employees pay for their                   which can be used to pay for eligible current out-of-pocket
share of benefit coverage through payroll deductions.                       medical costs or to save for future health care expenses.
                                                                            For participants who enroll in the HSA, IBM will contribute
                                                                            $250 for self-only/$500 for family (pro-rated based on
Medical Choices
                                                                            date of hire). Also, again in 2018, IBM will also contribute
IBM Preferred Provider Organization (PPO)                                   $250 in a Jump Start contribution for self-only or family
The IBM PPO has a broad nationwide network of                               elections. Participants may also earn additional Live Well.
providers that provide care at discounted rates and                         Live Better. Rewards Program incentives, ranging from
offers the flexibility to receive care out-of-network at                    $300 for self-only coverage to $850 for family coverage
higher costs. It offers strong coverage for prevention,                     which will be deposited into employees’ HSA.
wellness and routine medical care, including in-                            Employees may contribute up to the IRS annual limit of
network eligible, routine preventive screenings and                         $3,450 for single coverage and $6,850 for a couple or
preventive office visits at no cost. Employees need to                      family. Like the other IBM PPO options, there is no charge
meet the deductible for Medical and/or mental health                        for in-network eligible, routine preventive services.

                                                                     3
However, to comply with IRS regulations for HSAs, all                 IBM Exclusive Provider Organization (EPO)
other services, including pharmacy (with the exception of             The IBM EPO offers the same broad network of providers
certain preventive prescription drugs) are subject to the             that is available through the IBM PPO and IBM PPO Plus
deductible. The IBM PPO with HSA and IBM Enhanced PPO                 options, along with the same coverage for routine preventive
with HSA features other provisions that conform with                  care, routine screenings and primary care provider services, all at
recent IRS HSA guidelines—for example, the deductible                 no cost to you. The EPO option is similar to an HMO in that it is an
amount itself meets the IRS requirement for a “high                   “in-network-only” option which means that (except for true
deductible” plan. The deductible also works differently               emergency situations) you must use in-network doctors, hospitals
under the IBM PPO with HSA and IBM Enhanced PPO with                  and other facilities to receive benefits. The EPO option has a
HSA, particularly if you enroll dependents in these options.          copay-based cost structure for high cost services such as inpatient
                                                                      hospital stays and ER visits along with along with the
If you enroll in one of the IBM HSA plan options, an
                                                                      coinsurance-based cost structure found in most Preferred
aggregate deductible applies when you enroll one or more
                                                                      Provider Organizations (PPOs) for most other services. You
dependents – that is, the family deductible must be met
                                                                      may see any network provider that you choose without a
before the plan pays medical, mental health or pharmacy
                                                                      referral, but many high cost services do require prior
benefits for any covered individual. The family deductible
                                                                      authorization to be covered.
must be met even if one person is incurring all of the
expenses.
                                                                      Tobacco Surcharge
If you enroll in self only coverage, you have to satisfy the
                                                                      A $50 per month surcharge will apply if you and/or your
Individual deductible for medical, mental health and non-
                                                                      enrolled spouse/domestic partner have used any tobacco
preventative medications before the plan pays benefits.
                                                                      products within six months of the date your IBM medical
                                                                      coverage begins. The $50 monthly surcharge will apply for
                                                                      each individual indicating tobacco use. This surcharge
The out-of-pocket maximums are “embedded”
                                                                      helps offset the additional healthcare costs typically
accumulators so they work differently than the HSA
                                                                      incurred by tobacco users. For purposes of this surcharge,
deductibles, which are “aggregate” accumulators. If one
                                                                      a tobacco product is defined as “any product derived from
individual meets their out-of-pocket maximum, the plan
                                                                      tobacco that is intended for human consumption” and
will start to pay at 100% for that individual. Each family
                                                                      includes cigarettes, cigars, pipe tobacco, smokeless
member’s out-of-pocket costs are applied to the family
                                                                      tobacco and e-cigarettes.
out-of-pocket maximum. Once the family out-of-pocket
maximum is met, the plan will pay 100% for all eligible covered       However, you will have an opportunity to earn a refund of
services.                                                             the surcharges you pay if you satisfy the requirements of
                                                                      your health plan administrator’s tobacco cessation
An HSA is different from a Health Care Spending Account
                                                                      program within six months or by December 31, 2018,
in that it is your own personal account and you do not forfeit
                                                                      whichever comes first. (Note: Although you may choose to
unused contributions and you can invest your HSA savings.
                                                                      participate in other tobacco cessation programs, you will
It is important to note that you may not enroll in the IBM
                                                                      not be eligible to receive a refund unless you complete the
Health Care Spending Account if you are enrolled in one of
                                                                      program offered by your IBM health plan).
the Health Savings Account plan options.
Note that anyone with Medicare, or coverage from other
                                                                      Primary Care
health plans that don’t offer qualifying high deductibles,
                                                                      Care provided by your in-network primary care physician
may not contribute to an HSA. Please consult your tax
                                                                      will be covered at 100% under the IBM PPO, IBM PPO Plus
advisor if you or your spouse has other coverage and you
                                                                      and IBM EPO options. Under the IBM PPO with HSA and
wish to enroll in a medical option with an HSA.
                                                                      IBM Enhanced PPO with HSA, primary care will be covered
                                                                      at 100% after the appropriate deductible has been
Health Maintenance Organization (HMO)                                 satisfied. A primary care physician is a physician (MD or
A HMO provides comprehensive, coordinated health care                 DO), nurse practitioner*, or physician assistant* who has a
services for a fixed prepaid fee through a network of                 primary designation of family medicine, internal medicine,
providers. Participants are typically responsible for                 or pediatric medicine. Keep in mind the doctor may
copayments and/or coinsurance for physician visits and                perform tests or request other services (e.g. lab) that will
other services.                                                       have a separate charge that may be subject to the
                                                                      deductible and applicable coinsurance. *Please note:
Generally, you aren’t covered for services outside the                Nurse practitioners or physician assistants billing under
network, except for emergencies. When you enroll in an                physicians will be designated as a PCP or specialist based
HMO, you select a primary care physician (PCP) to                     on the designation of the physician.
coordinate your care.

                                                                  4
Care Management                                                          •    Orthopedic surgery, including, but not limited to,
Each of the regional health plan administrators have Care                     knee or hip replacement or spinal fusion
Management and Disease Management programs,
                                                                         •    Bariatric surgery
designed to provide expert help in managing employees’
(and their family’s) health conditions and risks.                        •    If you are currently undergoing any of these
These programs include one-on-one outreach and support                        services, you may qualify for transition of care.
to those with serious illness and other complex medical
situations. These care coordinators are registered nurses
employed by each of the regional health plans and will              Best Doctors
assist with precertification for inpatient hospital                 When it comes to medical decisions, making informed
admissions and high cost medical procedures (listed                 decisions is key to maintaining good health and wellbeing.
below), medical consulting services and support to IBM              Best Doctors can help you by providing expert medical
medical plan participants and their families. Access to             advice, at no cost to you. All IBMers enrolled in one of the
expert assistance in managing chronic conditions is also            IBM medical plan options will have access to Best Doctors
available through the program.                                      in 2018.

Precertification is required for major diagnostic services in       Services are provided confidentially and from the comfort
non-emergency situations or the service will not be                 of your own home over the phone or online. Reach out to:
covered include: CT Scans, PET Scans, MRIs, nuclear
medicine, sleep studies, cardiac catheterization,
                                                                         • Confirm a diagnosis or treatment plan through
                                                                              an expert review of your medical records
echocardiogram (including stress echocardiogram),
electrophysiology implants, Arterial ultrasound,                         • Receive support when making treatment
Percutaneous coronary intervention (Stents, Balloon                           decisions
angioplasty, Atherectomy). Contact your health plan for                  • Ask an expert about a diagnosis or health
details regarding precertification.                                           condition
                                                                         • Find a local leading physician or specialist
Centers of Excellence                                                    • Get help collecting and organizing your medical
IBM's health plan administrators have Centers of                              records
Excellence (COEs), facilities and providers that meet
certain quality standards of care. In general, these                Oncology services available through Best Doctors include
providers' outcomes are better than others. Contact your            access to Watson technology including:
health plan if you are seeking care for any of the following            • Watson for Oncology
services or you may receive lower (or no) coverage for the
                                                                         •    Watson for Clinical Trials Matching
service. These services include:
                                                                         •    Watson for Genomics
     •    Transplants
     •    Infertility services, including but not limited to,       IBMers in HMOs or other medical plans are not eligible
          artificial insemination or in vitro fertilization         because those plans evaluate and contract for these types
          (enrollment in a care management program is               of services separately.
          also required.)

                                                                5
2018 Medical Benefits: Comparing Plan Features
  Plan Features         IBM PPO          IBM PPO Plus                          IBM PPO with HSA                IBM Enhanced PPO                    IBM EPO             Typical HMO
                                                                                                                   with HSA
Plan type             Preferred Provider          Preferred Provider          High Deductible Preferred     High Deductible Preferred           Exclusive Provider    Health
                      Organization                Organization                Provider Organization         Provider Organization with          Organization          Maintenance
                                                                              with HSA                      HSA                                                       Organization
Key features          You may obtain care         Same structure and          You may obtain care from      Same structure and flexibility as   You may obtain        You may obtain
                      from in- and out-of-        flexibility as IBM PPO,     In- and Out-of-network        IBM PPO with HSA. You pay higher    care through a        care through a
                      network providers;          higher cost for             providers; HSA lets you       cost for coverage in exchange for   network of            network of
                      you’ll receive the          coverage in exchange        use tax-free dollars to pay   lower in-network deductible.        providers; no         providers to
                      highest level of benefits   for lower in-network        for current or save for                                           coverage if you go    receive benefits;
                      if you use network          deductible. No charge       future health care needs;                                         out of network        no coverage if you
                      providers. No charge        for eligible in-network     IBM will contribute $500                                          (except for true      go out of network.
                      for eligible in-network     routine preventive          self-only coverage or $750                                        emergencies) No       Primary Care
                      routine preventive          services or in-network      family coverage (pro-                                             charge for eligible   Physician Referral
                      services or in-network      primary care office         rated based on date of                                            In-Network routine    required to
                      primary care office         visits. Specialty care      hire) in 2018. No charge                                          preventive services   coordinate all care.
                      visits. Specialty care      office visits “deductible   for eligible In-Network                                           or primary care
                      office visits “deductible   free” for in-network        routine preventive                                                office visits.
                      free” for in-network        care.                       services. No charge for
                      care.                                                   primary care office visits
                                                                              after deductible is
                                                                              satisfied.
Filing claims         You file claims for out-    You file claims for out-    You file claims for out-of-   You file claims for out-of-         No claim form to      No claim form to
                      of-network care only        of-network care only        network care only             network care only                   file                  file
 Annual deductible    In-network:                 In-network:                 $2,700 / $5,800               $1,500 / $3,000                     $100/$300             None
(individual/family)   $1,500 / $4,500             $375 / $1,125               (combined in- and out-of-     (combined in- and out-of-
                      Out-of-network:             Out-of-network:             network) Deductible           network) Deductible applies to
                      $2,650 / $7,950             $2,650 / $7,950             applies to pharmacy           pharmacy coverage (except
                                                                              coverage (except              preventive medications)
                                                                              preventive medications)
Routine Preventive    In-network:                 In-network:                 In-network:                   In-network:                         No charge             Varies by HMO
Services              No charge                   No charge                   No charge                     No charge
                      Out-of-network:             Out-of-network:             Out-of-network:               Out-of-network:
                      45%, no deductible          45%, no deductible          45%, no deductible            45%, no deductible
Other Office Visits   In-network:                 In-network:                 In-Network: No charge for     In-Network: No charge for PCP       No charge for PCP     Varies by HMO
                      No charge for PCP;          No charge for PCP;          PCP after deductible; You     after deductible;                   You pay 25% for
                      You pay 25% for SCP;        You pay 25% for SCP;        pay 25% for SCP after         You pay 25% for SCP after           SCP after
                      Deductible free             Deductible free             deductible                    deductible                          deductible
                      Out-of-Network:             Out-of Network:             Out-of-Network:               Out-of-Network:

                                                                                          6
You pay 45% after        You pay 45% after        You pay 45% after            You pay 45% after deductible
                        deductible               deductible               deductible
Urgent Care             In-Network: You pay      In-Network: You pay      In-Network: You pay 25%      In-Network: You pay 25%         You pay 25% after     Varies by HMO
                        25% after deductible     25% after deductible     after deductible             after deductible                deductible
                        Out-of-Network: You      Out-of-Network: You      Out-of-Network: You pay      Out-of-Network: You pay 45%
                        pay 45% after            pay 45% after            45% after deductible         after deductible
                        deductible               deductible
Inpatient Hospital      In-network:              In-network:              In-network:                  In-network:                     Inpatient: $1,000     Varies by HMO
and Surgery             You pay 20% after        You pay 20% after        You pay 25% after            You pay 25% after deductible    Copay after
                        deductible               deductible               deductible                   Out-of-network:                 deductible
                        PCP: 20% after           PCP: 20% after           Out-of-network:              You pay 45% after deductible
                        deductible               deductible               You pay 45% after
                        SCP: 25% after           SCP: 25% after           deductible
                        deductible               deductible
                        Out-of-network:          Out-of-network:
                        You pay 45% after        You pay 45% after
                        deductible               deductible
Emergency Room          20%, after in-network    20%, after in-network    30%, after deductible plus   30%, after deductible plus      $210 copay + $150     Varies by HMO
(copay(s) waived if     deductible plus $150     deductible plus $150     $150 copay (copay waived     $150 copay                      copay (both copays
admitted)               copay (copay waived if   copay (copay waived if   if admitted)                                                 waived if
                        admitted)                admitted)                                                                             admitted),
                                                                                                                                       after deductible
Other Services &        In-network: You pay      In-network: You pay      In-network: You pay 30%      In-network: You pay 30% after   After deductible:     Varies by HMO
Outpatient Surgery      20% after deductible     20% after deductible     after deductible             deductible                      $0 for X-rays,
                        Out-of-network:          Out-of-network:          Out-of-network:              Out-of-network:                 DME and
                        You pay 45% after        You pay 45% after        You pay 45% after            You pay 45% after deductible    prosthetics; 20%
                        deductible               deductible               deductible                                                   for other imaging
                                                                                                                                       services; 25% after
                                                                                                                                       deductible for
                                                                                                                                       Outpatient Surgery
Annual out-of-          In-network:              In-network:              In-network:                  In-network:                     $7,150 / $14,300      Varies by HMO
pocket maximum          $7,150 / $14,300         $7,150 / $14,300         $6,550 / $13,100             $6,550 / $13,100
(includes deductible)   Out-of-network:          Out-of-network:          Out-of-network: $15,750      Out-of-network: $15,750 /
                        $16,700 / $30,050        $16,700 / $30,050        / $28,350                    $28,350

              IBM’s Live Well. Live Better. Rewards Program                                   Quarterly Wellness Drawings
                                                                                              Eligible employees can enter quarterly wellness drawings
              IBM wants you to be as healthy as you can be across all 5                       to win 12,000 BluePoints (approximately a $3,000 value).
              dimensions of health: Physical, Mind, Social, Financial and                     For each Live Well. Live Better. Rewards Program
              Purpose. We take health and wellbeing support to                                completed per quarter, your name will be entered into the
              another level with our Live Well. Live Better. Rewards                          quarterly drawing; each program can be completed up to
              Program. To enhance your personal health management,                            four times. In addition, employees will earn additional
              we offer program options to support physical activity,                          entries for programs covered spouses and partners
              healthy eating, mindfulness, and more through CaféWell,                         complete each quarter. Employees can only be entered
              our one-stop health and wellness platform. Once you’re                          into the drawing 1 time per program per quarter.
              registered on CaféWell, you can create (and update) your                        Employees can choose from a wide variety of programs,
              health profile, order your personal health devices, earn                        including some new program options, to best meet their
              BluePoints entries, complete your HSA financial incentives                      personal health and wellbeing goals across all five
              (if applicable) and locate valuable benefits resources. The                     dimensions of health. A full list of program options is
              programs are made available to you at no cost.                                  available on CaféWell.

              Wellness Device Voucher                                                         Health Savings Account (HSA) Incentives
              All IBMers will have the opportunity to earn a $100 device                      If you choose a medical plan option with an HSA, you will
              voucher in 2018 by joining a Live Well. Live Better.                            be eligible to earn up to $300 in tax-free HSA contributions
              Rewards Program on CaféWell. Device choices include a                           for self-only coverage or $850 for family coverage in
              variety of fitness devices, such as Apple Watch and FitBit.                     addition to the automatic company contribution ($500 for
              In addition to a sit-stand desk accessory or other exciting                     self-only or $750 for family, prorated based on date of
              choices to support your health and well-being. Plus, take                       hire). If you participate in an HSA medical plan option, you
              advantage of quarterly wellness drawings for program                            will earn your financial incentive by completing the Ready,
              completions.                                                                    Set, Go! Program. This program allows you to earn your
                                                                                              tax-free HSA contributions by completing three easy steps.
                                                                                              Make sure your covered spouse/domestic partner does

                                                                                      7
the same, so you earn the maximum reward.                                     so we know what is most important to you.
Step 1 – Ready: Register on CaféWell and enter your
spouse or partner’s email address.
Step 2 – Set: Select a primary care provider (PCP) for each
                                                                              To receive these financial incentives, employees must
covered family member when you enroll and set up your
                                                                              complete the incentive requirements by December 1, st,
HSA account on NetBenefits (one account per family).
                                                                              2018. HSA Incentives will take approximately four to six
Then, set up your account for Telemedicine and Cost and
                                                                              weeks to be processed and deposited into your HSA
Quality Comparison Tool with your medical plan.
                                                                              account once CaféWell confirms completion.
Step 3 – Go!: Complete the 5 Dimensions Priority Survey

                                                                                           Be Rewarded!
   If you enroll in the IBM PPO with HSA or IBM
   Enhanced PPO with HSA
                                                                          Individual                                    Family

   Automatic HSA Seed from IBM (*Prorated
   based on date of hire)
                                                                           $250*                                         $500*

   HSA Jump-Start Contribution                                              $250                                         $250

   Complete IBM's Ready-Set-Go Program
   via CaféWell by December 1st
                                                                            $300                                         $850

   Total Available HSA Incentives                                           $800                                        $1,600

                                                      Payments will be processed after you certify that you have completed all program
                                                      requirements and will be deposited in your HSA; payments are not subject to taxes.
   How incentives are paid                            *Both the employee and spouse / partner, if applicable, must complete the Ready,
                                                      Set, Go! Program to earn the family coverage contribution. If you only have covered
                                                      child dependents, you will be able to earn all of the incentives on behalf of the family.

Prescription Drug Benefits                                                    brand retail pharmacies and no other retail pharmacies in
                                                                              the CVS Caremark retail pharmacy network.
Under IBM PPO, IBM PPO Plus, IBM EPO, IBM PPO with
HSA and the IBM Enhanced PPO with HSA, prescription
drug services are provided by CVS Caremark through the                        GenericsAdvantage
IBM Managed Pharmacy Program. Employees can save                              The GenericsAdvantage component of the IBM
money on retail and home-delivery prescription drugs                          Managed Pharmacy Program reduces your out-of-
when a prescription is filled through a CVS Caremark                          pocket costs when you buy generic instead of
participating pharmacy or via the CVS Caremark Mail                           brand name prescription drugs. If a generic
Service pharmacy.                                                             equivalent (identical active ingredient) is available
                                                                              and you choose a brand name drug instead, you
You may obtain up to a 30-day supply (plus up to two refills) of              will pay the generic coinsurance plus the
a (non-specialty medication) prescription from a retail                       difference in cost between the generic and brand
pharmacy; you’ll save money if you use a CVS Caremark                         name drug. The per-prescription maximum will
network pharmacy. After the third fill, you must obtain your                  not apply as it usually would for CVS Caremark
medication, up to 90-day supplies, through CVS Caremark mail                  participating pharmacies and mail order
order or Maintenance Choice® or you will be responsible for                   prescriptions. The amount that applies to your
the full cost of the medication at a retail pharmacy.                         out-of-pocket maximum is the amount of
                                                                              coinsurance for the generic equivalent. The
Maintenance Choice®                                                           difference in cost between the generic equivalent
You can obtain your long-term medications through the                         and the brand drug does not accumulate to your
CVS Caremark Mail Service Pharmacy and have them                              out-of-pocket maximum.
shipped directly to your home or you can pick them up at
your local CVS retail pharmacy for the same coinsurance.                      However, if your physician validates it is clinically indicated
Please note, Maintenance® Choice is only available at CVS                     for you to use the brand name drug, you will only pay the

                                                                      8
brand name coinsurance (and not the difference in cost). In                              doctor will first need to contact a CVS Caremark
  those few cases where a particular brand name drug is                                    pharmacist for authorization to confirm that the treatment
  comparably priced with a generic in the same class of drugs,                             complies with standard clinical guidelines. This
  prior authorization will not be required for that drug. Prior                            requirement will help ensure that you receive proper drug,
  authorization will still be required for other brand name                                dose and treatment based on your diagnosis.
  drugs in that class; otherwise they will not be covered.
                                                                                           There are certain infused medications (not chemotherapy)
                                                                                           which must be purchased through the CVS Caremark
  Specialty Medications                                                                    Specialty Pharmacy if they are received in an outpatient
  If you need covered prescription medication that requires                                setting. The CVS Caremark Specialty Pharmacy will work
  special handling or administration — such as chemotherapy —                              with you and your doctor to obtain the medication and
  and are currently receiving it through your doctor’s office or                           coordinate where the infusion will be administered.
  other treatment center, you can order it through the CVS
                                                                                           Note: For participants in fully insured HMOs, prescription
  Caremark Specialty Pharmacy. Ordering it this way may save
                                                                                           drug benefits are provided through the HMO and vary by
  you money, and you may be able to have it shipped directly to
                                                                                           plan. See your Health Plan Detail Sheets for details.
  you or your doctor’s office at no additional charge. Your

  Prescription Drug Coverage
  The chart below shows what you pay per prescription under the IBM Managed Pharmacy Program. Please refer to Your Medical
  Plan Options At-A-Glance for the applicable out-of-pocket maximum for each plan option. Additionally:
       •    Under both the IBM PPO with HSA and the IBM Enhanced PPO with HSA plan options, benefits are not payable until
            the annual deductible is met; however, preventive drugs are not subject to the deductible. If more than one individual
            is enrolled, the family deductible must be met; individual deductibles do not apply.
          •   For all IBM PPO plan options and the EPO plan option, the amount you pay out-of-pocket for eligible prescription
              drugs counts toward your out-of-pocket maximum except the difference you pay between the cost of a brand drug
              and its generic equivalent when you choose to purchase the brand name medication (as described under the Generics
              Advantage description).
                                                                                                                          CVS Caremark Mail Order, Specialty Pharmacy1
                                                  Participating Pharmacies              Non-Participating Pharmacies
                                                                                                                               and Pharmacy Maintenance Choice
                                                    (up to 30-day supply)                  (up to 30-day supply)
                                                                                                                                     (up to 90-day supply)
                           Traditional and specialty medications for the IBM PPO with HSA and IBM Enhanced PPO with HSA1
                                          10% of discounted cost after                  30% of actual cost after          10% of discounted cost after deductible, up
Generic
                                          deductible, up to $20                         deductible                        to $40
Brand name – formulary                    30% of discounted cost after                  40% of actual cost after          30% of discounted cost after deductible, up
(preferred)                               deductible, up to $1102                       deductible                        to $2752
Brand name – non-formulary (non-          50% of discounted cost after                  55% of actual cost after          50% of discounted cost after deductible, up
preferred)                                deductible, up to $2102                       deductible                        to $5002
                                   Traditional and specialty medications for the IBM PPO, IBM PPO Plus, and IBM EPO1
Generic                                   10% of discounted cost, up to $20             30% of actual cost                10% of discounted cost, up to $40
Brand name – formulary
                                          30% of discounted cost, up to    $1102        40% of actual cost                30% of discounted cost, up to $2752
(preferred)
Brand name – non-formulary (non-
                                          50% of discounted cost, up to $2102           55% of actual cost                50% of discounted cost, up to $5002
preferred)
  1Refer to www.caremark.com/ibmactives for a full list of specialty drugs available through the CVS Caremark Specialty Pharmacy for January 2018.
  2Ifa generic drug with the identical active ingredient is available, and you choose the equivalent brand name drug instead, you will pay the generic drug coinsurance
  plus the difference between the generic and the applicable brand name drug; per prescription maximums will not apply.

  Mental Health Benefits                                                                   IBM Enhanced PPO with HSA.

  Managed Mental Health Care Program
  The IBM Managed Mental Health Care Program provides                                      Employee Assistance Program (EAP)
  comprehensive inpatient and outpatient treatment for                                     The IBM Employee Assistance Program (EAP) provides
  emotional and psychological problems, substance abuse                                    short-term counseling for a variety of life events and
  and related conditions. Participants have access to a                                    everyday challenges including Work Stress; Coping with
  network of licensed psychiatrists, psychologists, social                                 Change; Family/Parenting Issues; Grief or Bereavement;
  workers, psychiatric nurses, and mental health and                                       Anxiety or Depression; and Communicating Effectively. A
  substance-abuse facilities. Pre-certification is required to                             Clinical Referral Line (CRL) is the entry point for the EAP,
  receive the highest level of reimbursement. Services are                                 which also offers up to eight free counseling visits with a
  available to employees and their dependents enrolled in                                  licensed mental health or substance-abuse professional.
  IBM PPO, IBM PPO Plus, IBM EPO, and IBM PPO HSA and                                      The EAP is available to all benefit-eligible employees and

                                                                                    9
their dependents, including HMO participants and those
who opt out of benefits. EAP services are provided by
Optum by United Behavioral Health. This program is not
intended for treatment of long term problems or mental
illness.
Required EAP notification for employees living in the state
of California detailing: 1) time limits on how quickly your
Employee Assistance Program (EAP) must provide certain
services to you and 2) requirements on receiving services in
your preferred language can be found on Optum
Behavioral Health's web site. Visit
www.liveandworkwell.com and use access code IBM to
sign in anonymously (or use your own ID and password).
Scroll to the bottom of the page and click the link for
"State-specific notices" to view the California notification
details.

Dental Choices
                                                                    IBM Dental Plus
Not everyone’s dental needs are the same. Some                      This option covers a broad range of dental services,
employees may visit the dentist only twice a year for               including preventive, diagnostic, basic and major
checkups; others may require more extensive work every              restorative care, and orthodontia. Although employees
year. The IBM Personal Benefits Program offers up to                have the flexibility to use any eligible dentist, they can
three different dental coverage options to meet these               receive a higher level of benefits if they use a network
varying needs.                                                      provider. If employees use a dentist in the network, the
                                                                    plan covers preventive care at 100% (including up to two
IBM Dental Basic                                                    routine exams per year). For all other eligible expenses,
This option covers preventive, diagnostic and basic                 employees pay a percentage of specially negotiated fees,
restorative dental care. There is no coverage for major             with no deductible, as follows:
restorative care or orthodontia. Employees have the                   •    20% for minor restorative care
flexibility to use any eligible dentist. However, employees           •    35% for major restorative care
can receive a higher level of benefits if they use a network          •    50% for orthodontia treatment up to a lifetime
provider. If employees use an in-network dentist, the plan                 maximum of $2,500
covers preventive care at 100% (including up to two
routine exams per year).                                            If employees use an out-of-network dentist or live in an
For minor restorative care, employees will pay 20% of a             area where a network dentist is not available, they will pay
specially negotiated fee, with no deductible. If employees          a percentage of the usual and prevailing (U&P) rate, plus
use an out-of-network dentist or live in an area where a            any amount above the U&P rate.
network dentist is not available, they pay 20% of the U&P           IBM Dental Plus pays benefits up to an annual maximum of
rate plus any amount above the U&P rate for covered                 $2,000 per covered individual. There is no lifetime
preventive and minor restorative care expenses. There is            maximum benefit except for orthodontic treatment
no annual deductible. IBM Dental Basic pays benefits up to          benefits—up to $2,500 per covered individual—which is
an annual benefit maximum of $500 per covered                       not counted toward the annual maximum.
individual. There is no lifetime benefit maximum.

                                                               10
Vision Choices                                                     EyeMed Vision Discount Plan
                                                                   Employees can enroll in the free vision discount plan,
IBM Vision Plan                                                    which allows them to save money each time they buy
The IBM Vision Plan, administered by Anthem Blue View              frames, lenses, contact lenses, or other eyewear
Vision, provides coverage for standard eye exams at 100%           purchased through specific vision care centers. Employees
coverage if employees use an eye doctor who participates           pay no monthly contributions for the card, but must enroll
in the network. Or they can go out-of-network to the               to receive it.
provider of their choice. With out-of-network care,
reimbursement is based on a schedule of benefits.                  Employees can choose to enroll in the IBM Vision Plan or
                                                                   EyeMed Vision Discount Plan, but not both.

Flexible Spending Accounts                                         Based on federal tax legislation, the plan is an alternative
                                                                   to the tax credit allowed for child and dependent care
Health Care Spending Account (HCSA)                                expenses. Highlights of the plan are as follows:
The HCSA lets employees allocate pre-tax dollars to an
account to help pay for eligible health care expenses per            •    Before each plan year, employees can elect to set
IRS regulations. Highlights of the plan are as follows:                   aside an amount of money based on their estimated
  •    An annual maximum of $2,600 can be set aside for                   dependent care expenses.
       health care expenses. Any unused money set aside              •    Participation is allowed if employees need
       during the plan year is forfeited if it is not used.               dependent care to enable themselves and their
  •    These expenses can include deductibles,                            spouses to work, or attend school full-time.
       copayments and other unreimbursed medical,                    •    The amount elected is deducted from their
       dental, vision and hearing expenses.                               paychecks before taxes.
  •    Expenses for eligible family members can also be              •    An annual maximum of $5,000 can be set aside for
       reimbursed, even if they are not covered under the                 dependent care. Any unused money set aside is
       employee’s benefits.                                               forfeited.
  •    Employees who participate in the HCSA and are also
       enrolled in the IBM PPO, IBM PPO Plus, IBM EPO or           Commuter Benefits Program
       certain HMOs will receive a Health Debit Card, a            The IBM Commuter Benefits Program helps you save
       stored value card that will enable them to pay              money on mass transit and qualified parking expenses on
       eligible expenses through automatic deduction from          commuting to work by paying for eligible expenses pre-
       their HCSA.                                                 tax. A nationwide program, administered by WageWorks®,
                                                                   that helps you save on public transportation and qualified
Reminder: You may enroll in either the Health Care                 parking expenses.
Spending Account or the IBM PPO with Health Savings
Account, but not both.                                             You save on commuting costs because your payroll
                                                                   deductions are made pre-tax, before FICA, federal, state,
                                                                   and city income taxes (for most states and cities), up to a
Dependent Care Spending Account (DCSA)                             monthly amount of $255 for transit and $255 for parking.
The DCSA lets employees allocate pre-tax dollars to an             Any payroll deduction above these limits will be taken on
account to help pay for eligible dependent care expenses.          an after-tax basis.

                                                              11
Life and Disability Benefits                                        accidental death, is available for employees and their
                                                                    spouses. Employees must apply for GUL.
Short-Term Disability (STD) Income Plan
IBM’s Short-Term Disability (STD) Benefit Plan provides             Eligible employees who apply within the first 90 days of
employees with salary continuation for each day they are            hire may receive coverage of two times their annual base
absent due to illness or injury, up to a maximum of 26              pay, not to exceed $750,000, with no medical evidence
weeks in a period of 12 consecutive months depending on             and coverage of greater than two times annual base pay
your date of hire and hiring division. You are eligible for         with simplified evidence of good health. For financial-
this coverage on your first day of employment.                      planning purposes, GUL has a capital accumulation feature
                                                                    that offers an opportunity to earn tax-deferred interest on
The benefits provided under this plan are offset with any           cash contributions made while insured. Based on age and
Social Security Disability Income or Workers Compensation           each $1,000 of life insurance coverage, employees are
payments, or both. To receive STD benefits, employees               allowed to deposit cash in the form of an additional
may be asked to provide supporting documentation. In the            premium, which then earns tax-deferred interest. The GUL
event employees become totally disabled, they receive               program is administered and underwritten by The
maximum benefits under this plan before benefits begin              Prudential Insurance Company of America. This program is
under the Long-Term Disability (LTD) Plan.                          not endorsed by IBM.

Long-Term Disability (LTD) Plan                                     Business Travel Accident Insurance Plan
IBM’s Long-Term Disability (LTD) Plan provides employees            This program provides insurance benefits if employees are
with important income protection if they become sick or             traveling away from their job locations or homes on
injured for an extended period of time. The plan offers the         authorized company business. Eligibility starts with the
following options:                                                  first day of employment. The plan provides benefits up to
  •    No coverage                                                  five time’s annual compensation ($50,000 minimum) for
  •    50% of pay, employee-paid with before-tax dollars            accidental bodily injuries that result in death,
  •    66 2/3% of pay, employee-paid, with before- tax              dismemberment or loss of sight, hearing or speech.
       dollars
Coverage is offset with other sources of disability income,
such as Social Security Disability Income or Workers’               Medical Coverage (after you leave IBM)
Compensation, or both. The LTD period begins on the date
                                                                    When you retire or leave from IBM, you’ll want to know
immediately following the expiration of the STD Income
                                                                    how the company helps support your future health care
Plan coverage.
                                                                    needs. If you are not yet Medicare-eligible, in most cases,
                                                                    when you leave IBM, you will be able to continue your
Group Life Insurance (GLI)                                          coverage under an IBM-sponsored health benefits plan, at
The IBM Group Life Insurance (GLI) benefit equals one               least for some period of time.
times an employee’s annual salary, up to a maximum of $1
million. The IBM GLI plan includes a feature that allows
                                                                    Transitional Medical Program (TMP)
terminally ill employees to have access to one-half of their
                                                                    The Transitional Medical Program (TMP) is a health care
benefits (up to $50,000), with the remaining benefit paid
                                                                    continuation of coverage program available to participants
to the beneficiary either as a lump sum or in annuity
                                                                    of the IBM plans when eligibility for IBM health care
payments. Additionally, a check-writing feature is available
                                                                    benefits ceases. TMP satisfies the requirements of federal
to the beneficiary. Although the GLI plan is offered to all
                                                                    legislation (COBRA), which gives continuation rights to
IBM employees at no cost, the value of the premiums for
                                                                    employees and their dependents who lose coverage due
coverage above $50,000 is viewed by the IRS as taxable
                                                                    to certain qualifying events (for example, termination,
income (referred to as imputed income) and employees
                                                                    divorce, death, loss of dependent eligibility). Under TMP,
are responsible for the associated taxes.
                                                                    for a limited time, employees can continue coverage
                                                                    equivalent to that which they had been receiving as an
Group Universal Life (GUL) Insurance Program                        IBM benefits recipient or covered dependent. Employees
Employees have the opportunity to apply for term-life               pay for coverage at 102% of the group rate.
coverage for themselves or their eligible family members,
or both, under the Group Universal Life (GUL) Insurance
                                                                    Retiree Medical Coverage
Program. Employees enrolled in this program may receive
                                                                    Newly hired employees will have access to post-retirement
coverage up to eight times their annual salaries. Coverage
                                                                    IBM health care coverage if certain age and service
for a spouse is available up to $200,000 and child rider
                                                                    requirements are met. Employees will be eligible for
coverage for $10,000 is available for each eligible child.
                                                                    access if they leave IBM at age 55 or above with at least
Optional Accidental Death and Dismemberment (AD&D)
                                                                    five years of service, and their age plus service equals 65
coverage, which doubles the basic coverage in the event of
                                                                    (“Rule of 65”).

                                                               12
Those who are eligible for access can continue IBM health           Capital Accumulation and Investment
care coverage for themselves and eligible dependents by
paying full retiree rates. There is no time limit or maximum        IBM 401(k) Plus Plan
coverage period; however, election of coverage is a one-            With IBM 401(k) Plus, eligible employees have at least
time enrollment opportunity. If coverage is not elected             three ways to save: before-tax, after-tax, or through a
within the specified enrollment period immediately                  Roth 401(k) option – or all three. Each option has different
following retirement from IBM, employees are considered             advantages for you and different tax consequences.
to have declined access coverage and they waive the right           Savings are automatically deducted from your paycheck,
to any future election of coverage.                                 and you decide how to invest them.
                                                                    Save before-tax: Subject to an IRS annual contribution
Medicare                                                            limit that can change each year, eligible employees can
Once retired IBMers, and those on IBM’s MDIP/LTD plans,             save up to 80% of your eligible pay before taxes are
those on bridge leaves of absence and surviving spouses             deducted. When you use this savings feature, IBM
become eligible for Medicare, you will no longer be eligible        matches your savings; plus, you lower your taxable
for coverage under the IBM Retiree Benefits Plan. Instead,          income. You will pay income tax on this savings and any
you and any eligible Medicare eligible dependents will              investment growth when you withdraw the money.
need to enroll in Medicare Part A and Part B and obtain             Save after-tax: Eligible employees can also save up to 10%
your coverage through the Towers Watson OneExchange.                of your eligible pay on an after-tax basis, to provide
OneExchange is a private Medicare exchange that offers              further flexibility. You do not have to first reach the IRS
individual coverage for medical, prescription drug, dental          savings limit to use this option. With this feature, you
and vision plans.                                                   contribute funds after taxes have been deducted, while
                                                                    any investment growth on those amounts is tax deferred.
                                                                    That means you will not owe taxes on any investment
Survivor Health Benefit                                             growth until you withdraw the money, when it’s taxed as
When an eligible employee dies, coverage for eligible               ordinary income.
survivors can continue under the Transitional Medical
Program (TMP) for up to 36 months from the date                     Roth 401(k): This feature allows eligible employees to
coverage ends under IBM, should the survivor elect to               save on an after-tax basis now – but any investment
enroll in TMP. Coverage and contributions for a surviving           growth on your contribution is completely tax-free when
spouse and eligible dependents are determined by the                you withdraw the money at a later date, assuming certain
plan in effect at the time of the employee’s death, and             requirements are met. (Your Roth 401(k) account must be
may be modified thereafter.                                         at least five years old when you withdraw it, and you must
                                                                    take the money after you reach age 59½ to qualify for this
                                                                    tax treatment).
                                                                    Together, the sum of your Roth 401(k) and before-tax
                                                                    401(k) contributions may not exceed the maximum IRS
                                                                    annual contribution. Key features of IBM 401(k) Plus Plan
                                                                    are:
                                                                        •   Eligible employees can defer their own pay from
                                                                            date of hire
                                                                        •   Automatically enrolled into the before-tax 401(k) at
                                                                            5% of eligible earnings after approximately one
                                                                            month on payroll, if no action taken
                                                                        •   May increase contribution up to 80% of pre-tax
                                                                            earnings (subject to IRS limits) or may stop
                                                                            participation at any time
                                                                        •   Generally, after one year of service, IBM will:
                                                                               o Contribute 1% to employee’s account
                                                                                    regardless of their savings levels
                                                                               o Match 100% of the first 5% of employee’s
                                                                                    Pre-tax or Roth contributions
                                                                               o The IBM match will be deposited on Dec. 31
                                                                                    (or the last business day of the year) for
                                                                                    employees on active payroll as of Dec. 15.
                                                                        •    Rollovers from former employer’s qualified plan
                                                                             are allowed
                                                                        •    Loan provision is available

                                                               13
January 1 and July 1. More details on the plan can be
                                                                          found in the plan prospectus, which employees can access
                                                                          on the IBM intranet @ w3.ibm.com/hr/global/espp once
Key provisions include:                                                   you have access to IBM Systems.
    •   33 primary investment options to select from,
                                                                          Time Off
        along with access to approximately 165 brand-
        name mutual funds through a Mutual Fund                           Holiday Plan
        Window                                                            IBM provides 12 holidays each year; six days are observed
    •   Several distribution methods                                      nationally:
    •   Disability protection insurance (enrollment only
                                                                          • New Year’s Day
        during Fall Annual Enrollment Period)
                                                                          • Memorial Day
    •   Account access via NetBenefits.com/ibm
                                                                          • Independence Day
                                                                          • Labor Day
401(k) Plus Plan Investment Options
                                                                          • Thanksgiving Day
 Tier 1:                 Target Date:2055, 2050, 2045, 2040, 2035,
 Life Cycle Funds        2030, 2025, 2020, 2015, 2010                     • Christmas Day
                         Life Strategy:
                         • Income Plus
                                                                          The other six holidays vary by location based on operating
                         • Conservative
                         • Moderate                                       requirements or local custom. At least one of these days is
                         • Aggressive                                     considered a Personal Choice Holiday.
  Tier 2:                • Interest Income
                                                                          Vacation Plan
  Core Funds             • Inflation-Protected Bond
                                                                          IBM offers a competitive vacation plan to all regular full-
                         • Total Bond Market
                         • Total US Stock Market Index                    time employees and regular IBM employees who work
                         • Total International Stock Market               alternative work schedules. The Vacation Plan is based on
                           Index                                          years of service. Scheduling is based on business and
                         • Global Real Estate Stock                       personal preference. Employees can take vacation any
                         • High Yield & Emerging Market Bond              time during the year in weeks, days or half-days. For most
  Tier 3:                • Long-Term Corporate Bond                       employees:
  Expanded Choice         Fund
  Funds                  • Large Company Index
                         • Large-Cap Value Index
                         • Large-Cap Growth Index                         IBM service                  Weeks of vacation
                         • Small/Mid-Company Stock Index
                                                                          Less than 10 years                          3
                         • Small-Cap Value Index
                         • Small-Cap Growth Index                         10 or more years                            4
                         • European Stock Index
                         • Pacific Stock Index
                         • IBM Stock
                         • Emerging Markets Stock Index                   Most employees in the year of hire will earn vacation
                         • Real Estate Investment Trust Index             based on the number of full months worked during the
                         • International Real Estate Index                year.
  Tier 4:                Mutual Fund Window – 6 Families, about
                                                                             Full Months        Number of Days             Number of Days
                         165 funds
                                                                               Worked                Earned                     Earned
Please refer to plan document, IBM 401(k) Plus Plan Summary
                                                                                               (0-9 yrs of service)       (10+ yrs of service)
Plan Description and the Summary of Material Modifications, SPD
and w3 (upon joining IBM) for information on the 401(k) Plan.                    12                   15.0                       20.0
                                                                                 11                   14.0                       18.5
                                                                                 10                   12.5                       16.5
Employees Stock Purchase Plan (ESPP)
                                                                                 9                    11.5                       15.0
The IBM Employees Stock Purchase Plan (ESPP) provides
                                                                                 8                    10.0                       13.5
eligible employees with opportunity to purchase IBM stock
                                                                                 7                    8.5                        11.5
at a 5% discount off the market price on the date the
                                                                                 6                    7.5                         10
shares are purchased. Employees may elect to purchase
                                                                                 5                    6.5                        8.5
up to 10% of their eligible compensation, up to certain
plan and regulatory limits, for the purchase of IBM stock                        4                    5.0                        6.5
through payroll deductions.                                                      3                    4.0                        5.0
                                                                                 2                    2.5                        3.5
As a general rule, individuals who are active employees of                       1                    1.0                        1.5
IBM or any of its eligible subsidiaries will be eligible to
participate at the beginning of the offering period
following their date of hire. Dates of offering are normally              For additional plan details and to determine how much

                                                                     14
vacation you are eligible to accrue, please read the About
Your Benefits: Work & Personal Life Integration and
Supplement documents.

Personal Time Off                                                   Family and Personal Services
IBM understands that there will be circumstances that will          IBM has demonstrated a long history of commitment to
require time off from work for personal reasons other than          developing and enhancing programs to help employees
illness or injury. If the absence is to be a short one, your        better manage their work, family, and personal
manager may arrange for you to take time off with or                responsibilities and achieve enhanced productivity. Our
without pay, depending on the circumstances. If you need            global programs offer innovative solutions to address
to be away for longer than ten days on personal matters,            workload, dependent care, collaboration, and connecting
you should apply for a personal leave of absence without            with our clients - both inside and outside of IBM.
pay. Such leaves may be granted according to need and
business circumstance.

IBM Leaves of Absence Program (LOA)
The IBM Leaves of Absence (LOA) Program provides
employees unpaid time away from work for an extended
period. Employees can request an LOA for a variety of
circumstances such as dependent care or continuing
education. Eligibility for voluntary LOAs (for example,
personal leaves, Peace Corps leaves or continuing
education) is based on business needs and satisfactory job
performance. Voluntary LOAs are granted based on
management approval.
In some situations, time off is required by law, such as
military leave or Family and Medical Leave Act time off.            Thomas J. Watson Memorial Scholarship
While they are participating in the LOA Program, in most            The Thomas J. Watson Memorial Scholarship Program is a
cases, employees will be eligible for similar benefit plans         program that recognizes academic excellence among high
and programs as other regular employees. The cost for               school students planning to pursue a traditional
coverage will remain the same unless changes are made to            baccalaureate degree at an accredited four-year college,
existing coverage.                                                  university or military academy in the United States.
                                                                    International Scholarship & Tuition Services selects
IBM Parental Bonding Leave                                          winners based on their SAT scores, demonstrated
IBM's paid Parental Bonding Leave helps you bond in the             leadership, and junior year academic performance.
important weeks after you bring your child home. All                Financial need is not a factor in determining winners. Once
parents (mothers, fathers or adoptive parents, including            winners have been selected, the amount given to each
domestic partner parents) of a newborn or newly adopted             takes into account the cost of the institution and financial
child will receive 12 weeks of paid parental bonding leave          need. Awards for colleges or universities range from
within 12 months of the child's birth or adoption. At               $2,000 to $8,000 per year. The amount for military
manager discretion, paid parental bonding leave can be              academies is fixed as a one-time award of $2,000.
flexible and intermittent.                                          Your child may be eligible to submit an application if you
                                                                    are:
                                                                         •    A regular full-time or regular part-time employee
                                                                              in the U.S., its territories or Puerto Rico
                                                                         •    On international assignment (but scholarships
                                                                              are awarded only to U.S.-based institutions)
                                                                         •    On approved leave of absence (but scholarships
                                                                              are awarded only to U.S.-based institutions)
                                                                         •    Receiving regular benefits under the IBM Long-
                                                                              Term Disability Plan

                                                                    Surviving dependents of deceased employees are also
                                                                    eligible as long as the children continue to be eligible for
                                                                    IBM health benefits coverage. Certain other children may

                                                               15
be eligible if they meet specific criteria; call the IBM              Desk.
Benefits Center – Provided by Fidelity for details.
                                                                      College Coach experts provide interested employees with
                                                                      personalized assistance that is customized to the needs
                                                                      and grade of the child.
Adoption and Surrogacy Assistance Plan
The Adoption and Surrogacy Assistance Plan provides
some financial assistance toward expenses incurred in the             Global Work/Life Fund (GWLF)
adoption of minor children, including surrogate                       The Global Work/Life Fund (GWLF) is a multi-year, $50
arrangements. The plan covers 100% of eligible expenses               million fund designed to address strategic work/life
up to a lifetime maximum of $20,000 per family. Eligible              challenges for IBM employees worldwide, focusing on
expenses include:                                                     dependent care. IBM created the Global Work/Life Fund to
                                                                      develop and support child care and elder care programs
  •       Application fees
                                                                      benefiting working families. The first of its kind to address
  •       Adoption or surrogacy agency fees
                                                                      this issue worldwide, the IBM Global Work/Life Fund:
  •       Placement fees
  •       Lawyer’s fees and other required legal fees                   •    Increases the supply of services in communities
  •       Medical expenses of the surrogate, including In                    where IBMers live and work.
          Vitro Fertilization (IVF), whether or not the IVF             •    Creates global initiatives to improve the quality of
          attempt results in birth                                           dependent care.
  •       Hospital expenses while both birth mother and                 •    Supports the development of new and innovative
          infant are in the hospital                                         child care programs.
  •       Temporary foster care charges (immediately                    •    Invests in more than 300 child care centers
          preceding placement with adopting family)                          throughout the world where IBMers receive
                                                                             priority.
                                                                      IBM considers dependent care serious business and views
Special Care for Children Assistance Plan (SCCAP)                     the fund as an investment in the future of its employees.
The Special Care for Children Assistance Plan (SCCAP)
provides financial assistance outside the scope of the
                                                                      IBM MoneySmart
medical and dental plans for the care of a child with a
                                                                      IBM MoneySmart is a comprehensive program providing
mental or physical disability, or both, or a child with a
                                                                      financial education and planning for U.S. employees. The
developmental or learning disorder. Each case is
                                                                      program includes one-on-one phone counseling with
individually reviewed to determine eligibility for
                                                                      MoneySmart coaches – credentialed financial
assistance.
                                                                      representatives who are specially trained in IBM programs
Upon approval, reimbursement is provided for a portion of             and benefits.
the eligible charges incurred, up to a lifetime maximum of
                                                                      IBM has partnered with two leading financial firms - The
$50,000 per child or until the child attains the age of 26, or
                                                                      Ayco Company, L.P., a Goldman Sachs Company, and
until the child is no longer eligible under the IBM Medical
                                                                      Fidelity Investments – to help employees with financial
and Dental Benefits Plans, whichever comes first. The
                                                                      decision making on a range of issues, including retirement
following types of treatment and services may be eligible
                                                                      and estate planning, debt management, college savings,
for coverage under SCCAP:
                                                                      tax strategies and others.
      •      Special education facilities
      •      Independent practitioners and services
                                                                      SoFi Student Loan Refinancing
      •      Academic remediation
                                                                      SoFi’s refinancing loans let you combine existing private
      •      Evaluation and testing
                                                                      and federal loans into one loan, with one monthly
      •      Special devices
                                                                      payment at lower rates. Refinancing is available to IBMers,
                                                                      their spouses or domestic partners, children,
College Coach Program
                                                                      grandchildren and other family members and friends at a
IBM knows that educating your child can be a very
                                                                      0.25% discount.
stressful and time-consuming task for you and your whole
family. We are pleased to continue our partnership with               Expressly Service for Traveling Mothers
College Coach, an organization with an expertise in                   IBM supports working mothers’ personal choice to nurse
assisting families through important educational                      their baby. A recent addition to our family friendly
challenges, including selecting and applying to college. This         programs includes a breast milk delivery program for
benefit is available free of charge to all IBM employees              nursing mothers returning to work who are away from
and their families. The program is comprised of the                   home on business. Mothers are able to express milk and
following services: live and on demand training workshops,            ship it refrigerated back home overnight to their baby –
personalized counseling sessions and an Education Help                and IBM covers the cost.

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