As moua said, cookies are used initially to track a potential customer who has clicked through one of your r.cgi affiliate links, but in the circumstances you outlined above, it goes a little deeper than that.
If the person who clicked through creates an account, but does not purchase any hosting, you are still stored in the system as their referrer and the WEBID for the account is added to your list of referrals. Your referrals list shows the WEBID of such people in a non-bold font, while those that have made a purchase are shown in a bold font.
Now, if this person subsequently adds a plan to this account (identified by the WEBID), even many months after the fact and after clearing their cookies etc, you will still be credited with the rewards, unless they specify a new referrer or promo-code during the purchase.
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