IBM believes that all reports for IBM’s executive officers and directors that were required to be filed under Section 16 of the Securities Exchange Act of 1934 were timely filed.

Security ownership of certain beneficial owners

The following sets forth information as to any person known to IBM to be the beneficial owner of more than five percent of IBM’s common stock as of December 31, 2016.

Name and Address Number of Shares Beneficially Owned Percent of Class
Warren E. Buffett (1)
Berkshire Hathaway Inc. (1)
3555 Farnam Street
Omaha, NE 68131

National Indemnity Company (1)
1314 Douglas Street
Omaha, NE 68102
81,241,303 8.5%
The Vanguard Group (2)
100 Vanguard Boulevard
Malvern, PA 19355
57,862,237 6.08%
BlackRock Inc. (3)
55 East 52nd Street
New York, NY 10022
52,221,600 5.5%
State Street Corporation (4)
State Street Financial Center
One Lincoln Street
Boston, MA 02111
51,025,648 5.37%

(1) Based on the Schedule 13G/A filed with the Securities and Exchange Commission on February 15, 2017 by Warren E. Buffett, Berkshire Hathaway Inc., National Indemnity Company, together with relevant subsidiaries and members of the filing group. Warren E. Buffett reported that he had sole voting and dispositive power over 9,000 shares beneficially owned and shared voting power over 81,232,303 shares beneficially owned. Each of the other members of the filing group reported that it had shared voting and dispositive power over the shares it beneficially owned. The Schedule 13G does not identify any shares with respect to which there is a right to acquire beneficial ownership. The Schedule 13G states that the shares were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of IBM.

(2) Based on the Schedule 13G filed with the Securities and Exchange Commission on February 13, 2017 by The Vanguard Group and certain subsidiaries (Vanguard). Vanguard reported that it had sole voting power over 1,375,277 shares, shared voting power over 175,870 shares and sole and shared dispositive power over all shares beneficially owned. The Schedule 13G does not identify any shares with respect to which there is a right to acquire beneficial ownership. The Schedule 13G states that the shares were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of IBM.

(3) Based on the Schedule 13G filed with the Securities and Exchange Commission on January 25, 2017 by BlackRock, Inc. and certain subsidiaries (BlackRock). BlackRock reported that it had sole voting power over 44,062,404 shares and sole dispositive power over all shares beneficially owned. The Schedule 13G does not identify any shares with respect to which there is a right to acquire beneficial ownership. The Schedule 13G states that the shares were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of IBM.

(4) Based on the Schedule 13G filed with the Securities and Exchange Commission on February 7, 2017 by State Street Corporation and certain subsidiaries (State Street). State Street reported that it had shared voting and dispositive power over all shares beneficially owned. The Schedule 13G does not identify any shares with respect to which there is a right to acquire beneficial ownership. The Schedule 13G states that the shares were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of IBM.

(This information reflects the 2017 Proxy Statement)

Common stock and stock-based holdings of directors and executive officers

The following table sets forth the beneficial ownership of shares of IBM’s common stock as of December 31, 2016 by IBM’s current directors and nominees, the executive officers named in the 2016 Summary Compensation Table, and such directors and all of IBM’s executive officers as of December 31, 2016 as a group. Also shown are shares over which the named person could have acquired voting power or investment power within 60 days after December 31, 2016. Voting power includes the power to direct the voting of shares held, and investment power includes the power to direct the disposition of shares held.

      Acquirable within 60 days
Name Common Stock(1) Stock-based Holdings(2) Options and RSUs(3) Directors' DCEAP Shares(4)
K.I. Chenault 8,268(5) 8,268 0 28,264
E. Clementi 19,547 75,415 12,579 N/A
M.L. Eskew 0 0 0 24,301
D.N. Farr 4,908 4,908 0 5,020
M. Fields 400 400 0 1,600
A. Gorsky 0 0 0 4,564
S.A. Jackson 0 0 0 21,794
M. Jetter 1,007(6) 63,371 12,579 N/A
J.E. Kelly III 61,518(7) 144,161 0 N/A
A.N. Liveris 0 0 0 11,860
W.J. McNerney, Jr. 0 0 0 12,613
H.S. Olayan 0 0 0 1,939
J.W. Owens 3,282(8) 3,282 0 16,811
V.M. Rometty 189,747 266,104 0 N/A
M.J. Schroeter 21,188 99,656 25,835 N/A
J.E. Spero 1,000 1,000 0 26,596
S. Taurel 19,487 19,487 0 27,849
P.R. Voser 0 0 0 4,029
Directors and executive officers as a group 582,008(9) 1,613,510 196,269(9) 184,240(9)

(1) This column is comprised of shares of IBM common stock beneficially owned by the named person. Unless otherwise noted, voting power and investment power in the shares are exercisable solely by the named person, and none of the shares are pledged as security by the named person. Standard brokerage accounts may include nonnegotiable provisions regarding set-offs or similar rights. This column includes 78,328 shares in which voting and investment power are shared. The directors and officers included in the table disclaim beneficial ownership of shares beneficially owned by family members who reside in their households. The shares are reported in such cases on the presumption that the individual may share voting and/or investment power because of the family relationship. The shares reported in this column do not include 167,980 shares held by the IBM Personal Pension Plan Trust Fund, over which the members of the IBM Retirement Plans Committee, a management committee presently consisting of certain executive officers of IBM, have voting power, as well as the right to acquire investment power by withdrawing authority now delegated to various investment managers.

(2) For executive officers, this column is comprised of the shares shown in the “Common Stock” column and, as applicable, all restricted stock units including retention restricted stock units, officer contributions into the IBM Stock Fund under the IBM Excess 401(k) Plus Plan, and Company contributions into the IBM Stock Fund under the Excess 401(k) Plus Plan. Some of these restricted stock units may have been deferred under the Excess 401(k) Plus Plan in accordance with elections made prior to January 1, 2008, and they will be distributed to the executive officers after termination of employment as described in the 2016 Nonqualified Deferred Compensation Narrative.

(3) For executive officers, this column is comprised of (i) shares that can be purchased under an IBM stock option plan within 60 days after December 31, 2016, and (ii) RSU awards that vest within 60 days after December 31, 2016.

(4) Promised Fee Shares earned and accrued under the IBM Deferred Compensation and Equity Award Plan (DCEAP) as of December 31, 2016, including dividend equivalents credited with respect to such shares. Upon a director’s retirement, these shares are payable in cash or stock at the director’s choice (see 2016 Director Compensation Narrative for additional information).

(5) Includes 1,619 shares in which voting and investment power are shared.

(6) Includes 692 shares in which voting and investment power are shared.

(7) Includes 24,702 shares in which voting and investment power are shared.

(8) Voting and investment power are shared.

(9) The total of these three columns represents less than 1% of IBM’s outstanding shares, and no individual’s beneficial holdings totaled more than 1/10 of 1% of IBM’s outstanding shares.

(This information reflects the 2017 Proxy Statement)

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